The ratings on the U.K.-headquartered defense contractor BAE Systems PLC reflects our view of its strong competitive positions in the global defense market through a portfolio of diverse high-priority programs. BAE Systems designs, develops, and manufacturers a wide range of land combat vehicles and armaments, defense electronics, submarines, surface combatants, military aircraft, security electronics, and provides support services. The company benefits from its good customer, program, and geographic diversification. The rating is likewise supported by our view of the favorable credit characteristics of the defense industry. We view BAE's business risk profile as "strong" under our criteria. These strengths are partly offset by the risk associated with potential additional acquisitions and likely slower growth in defense spending in most of
