Support services company Babcock International said it expects its rail division to swing back into profit in the second half of the financial year.
The group’s rail division had a slow half-year to September 2007, losing £2.7 million, following difficulties over Network Rail’s decision to reduce the number of contractors it worked with.
The group said it has been selected as preferred bidder to provide spares for the Ministry of Defence ground support equipment. The contract is worth £25 million over five years, with an option for a further five years.
The group said overall, its trading had been in line with expectations since 1 October last year.