BAE Systems’ sales dropped by £1.5 billion over the last year, the defence giant has announced.

But the dip comes despite operating profits rising from £806 million to £1.3 billion and the basic earnings per share rocketing from 5.2p to 23.4p.

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The figures, part of the company’s 2014 full year results, show that sales have declined from £18.18 billion in 2013 to £16.637 billion last year.

The company said that the drop was due to ‘adverse exchange rates’, expected reductions in land and armaments and the come down from last year’s one-off Typhoon jet deal with Saudi Arabia.

The company’s net debt also rose to £1.032 billion from £699 million and the backlog of orders dropped by £2.2 billion to £40.5 billion.

BAE Systems employs 4,500 people at its Samlesbury base, which helped to manufacture 45 parts for the F-35 programme last year.

Chief executive Ian King said: “In 2014, BAE Systems delivered a solid overall performance, in line with guidance.

“We continue to win significant new business with over £10 billion of new orders from the UK and US for the third successive year.

“As a result, The large order backlog of £40.5 billion continues to provide good, multi-year visibility across many of our businesses.

“Looking ahead, defence spending remains a high priority in a number of international markets.

“In the UK, we benefit from long-term contracts, notwithstanding continued pressure on public spending.

“We believe US budgets are now relatively stable, with some early indications of a modest improvement in 2016.

“These are competitive times and we will continue to invest in and develop the technology, skills and market positions needed to drive the business forward.

“The group is well positioned to continue to deliver shareholder value.”

Chris Boardman, managing director of BAE Systems Military Air and Information, said: “In 2014 we made real progress on our key programmes with acceleration of capability expansion on the Typhoon aircraft, successful completion of the second phase of flight testing on the unmanned combat demonstrator Taranis and continued delivery on the F-35 Lightning II programme.

“We also secured contracts to continue the vital support we provide to the Royal Air Force’s fleet of Typhoon and Tornado aircraft and welcomed the UK and French government’s two-year feasibility study on Future Combat Air System technology.

“Although we continue to operate in a challenging environment I am confident we have the skills and ability to continue to meet these challenges and deliver against our commitments.”