Good morning, and welcome to the BAE Systems half-year results presentation. We have delivered another strong half of financial and operational performance, which underscores the strength of our global portfolio as a competitive differentiator. Before I turn to our results, let me take this opportunity to thank all our employees, trade unions, and partners up and down our supply chain. These excellent results would not be possible without them. I would also like to acknowledge, once again, the extraordinary bravery, fortitude, and resilience of the Ukrainian people in the ongoing conflict. We're proud to work with our government customers as they continue to support Ukraine. Now, turning to our financials.
Order flow in the first half was again very strong and lifted us to a new record backlog of GBP 66 billion, up 12% in six months, as we saw customers progress or accelerate planned orders, and we started to see some early elements of restocking resulting from the Ukraine conflict. On revenue, good overall program performance and a well-managed supply chain allowed us to deliver significantly higher sales and profit in the half. This operational performance and elevated order intake drove impressive cash flow as we increased investment in the business and enhanced shareholder returns. In support of our growth outlook, we recruited a net increase of over 3,000 employees in the first half, signaling an improvement in the labor market compared to last year.
Given the long duration of many of our programs, we are focused on early careers and outreach activities as we look to hire and retain the best talent, with meaningful increases in apprentices and graduate numbers already announced. We will be presenting an ESG update in September with our new Chair, Cressida Hogg, which will, amongst other things, highlight the work we're doing in skills and education. Reflecting this year's performance to date and our confidence in the outlook for the group, the board has declared an interim dividend of GBP 0.115, representing an 11% increase, announced a further three year share buyback of up to GBP 1.5 billion to roll on after completion of the current program, and we have increased all our key guidance metrics for the year.
The consistency of our performance over the past six months has further enhanced and extended our positive track record and built on the momentum we have established towards the business evolution targets we laid out over two years ago. Today, I will highlight two areas from that framework: our technology investment and why we are well-positioned for increased and sustained top-line growth. I'll start with technology and innovation, which is central to our strategy and development of our products and services. We have increased self-funded R&D by 11% in the half, building on increases in recent years. As a reminder, there are five core technology areas that support our aspirations for growth beyond our core defense franchises, namely autonomy, space, sustainability, manufacturing and design, and multi-domain and digital integration. The investment in our core franchises and these five next-generation priorities are driven by the evolving threat landscape.
At a tactical level, the conflict in Ukraine is highlighting the importance of a number of these key technologies, especially autonomy, synthetic training, digital, and multi-domain capabilities. We are driving innovation through the research labs embedded in our business sectors, including FAST Labs in Electronic Systems in the U.S., Red Ochre Labs in Australia, and most recently, FalconWorks in the air sector, which we launched last month. These hubs are agile innovation engines aimed at delivering breakthrough technologies to keep our customers ahead of the challenges they face. They also foster collaborative partnerships with academia and other organizations to bring even greater levels of creative and diverse thinking into BAE Systems. We've made significant progress against our technology work streams in the first half. Key highlights include the launch of the STRIX tactical uncrewed aircraft concept in Australia, furthering our autonomous portfolio.
Completing the first stratospheric flight of our solar electric drone, PHASA-35, which flew to more than 66,000 feet before landing successfully. This was an important milestone for a capability that has many opportunities across a broad range of defense and commercial applications. Our collaboration with Heart Aerospace, a Swedish electric airplane maker, to define the battery system for Heart's ES-30 regional electric airplane, which will be the first of its kind to be integrated into an electric, conventional takeoff and landing regional aircraft. Advancing our digital footprint by combining our own in-house expertise with that of innovative startups like Hadean to develop next-generation synthetic environments. In digital transformation, we are working with the UK government to connect and secure civil networks. For example, through our partnership with the Home Office to develop data analysis technology designed to help protect the UK's borders.
These are just a few highlights from a busy first half. They reflect our focus on sustaining and developing innovative technologies to deliver solutions for our customers, inspire our employees, and create long-term value for our shareholders. I'll move now to our confidence in the outlook for growth. You've heard us say that we're confident of a material step-up in sales growth. Coming off last year's 4.4% top-line growth, we are now entering the next phase in our growth agenda with accelerated momentum. These results and the guidance uplift, which Brad will talk about, should provide even more confidence that we are well-positioned to deliver good sustained top-line growth, margin expansion underpinned by a robust business model, and strong cash generation that will facilitate flexibility with a balanced and disciplined capital allocation framework, all of which would position us as a value-compounding stock from an investor perspective.
Why are we so confident about top-line growth? Long-term defense spending commitments, political alliances, and record orders in the first half all provide enhanced conviction that we expect a period of sustained growth, driven by our record order backlog, leading defense franchises, and multi-year programs providing visibility on long-term value generators, some of which are in their early phases, our diverse geographic footprint and deep customer relationships, and highly relevant and leading defense technologies. Here, I'm excluding any further upside from a significant opportunity pipeline and deployment of our future cash flows. Now I would like to explain the other drivers of growth and provide more color on how we see the outlook unfolding. If you look at our backlog and program incumbencies, we have visibility of our growth drivers to the end of the decade, and in some cases, beyond.
In the coming years, we expect growth across all our sectors, and in particular, Electronic Systems commercial portfolio, submarines and global ships, combat vehicles, especially from our Swedish facilities, and munitions and weapons restocking. That takes us through the end of the decade, when we expect the dual pillars of Global Combat Air and AUKUS to be major contributors to the group's revenue. Our confidence in the business is driven by strong visibility, and that is precisely why we are investing in our people, facilities, and technologies. We showed this slide back in February as a way to analyze our program visibility. We are essentially a long-term contracting and delivery business, which means that awards made now will be traded out over many years to come, often with a slow start as new programs ramp up.
You can see a number of our major programs are in their early phases and will be delivered over the coming years, with corresponding financial returns and retirement of risk. We are now seeing the power of our global portfolio. We are uniquely diverse in terms of geographic footprint and the spectrum of our capabilities, and that's proving to be a particular strength, with all sectors growing sales and order backlog in the first half. Looking ahead, our key growth drivers are also spread across our major geographies, and we're pursuing numerous additional near and long-term opportunities. Whilst early in the planning phase, the AUKUS agreement is significant for the group in the medium and long term. Combined with continued momentum on the Global Combat Air Programme, these multinational endeavors further highlight our global reach and the scale and longevity of our business.
Where do we see further opportunities? The need to restock and upgrade heavy armor and munitions is an area where our portfolio is particularly relevant and has already seen strong order flow. As detailed here, and as highlighted in our Land Capital Markets event in June, we've seen high demand for our capabilities and are pursuing opportunities with existing and new customers. Additionally, we have a pipeline of new opportunities in long-term structural growth markets to further enhance these expectations. Globally, we're pursuing excellent opportunities across all sectors as countries around the world face up to the multifaceted threat environment. In summary, the BAE Systems team delivered a strong first half as we build on our reliable track record of operational and financial performance. Strategically, we aim to generate long-term value and leverage core technology capabilities to position the portfolio for evolving customer priorities and future growth areas.
We're performing well, and I see tremendous potential in the coming years due to our continued focus on program performance and driving further margin expansion, the investments we're making to support the future, our record order backlog and leading technology solutions, our geographic diversity and broad spectrum of capabilities, combined with our global opportunity pipeline, and our strong balance sheet, good cash generation, and disciplined, value-enhancing capital allocation. Now over to Brad for the financials, further details on our capital allocation, and of course, guidance.
Thanks, Charles. As you indicated in the outset, this is a high-quality set of financials. This picture has become a familiar and consistent one over the last several years. Demand continues to grow, which we are successfully converting into new orders. Those orders continue to drive higher sales, expanding earnings, leading to consistently higher amounts of cash flow. With that, we have increased our investments in the business while growing cash returns to shareholders in the form of dividends and share buybacks, a balanced and disciplined capital allocation approach that is focused on compounding value creation. As you can see, the headlines show that with GBP 21 billion of new orders at the half year, our backlog now stands at a record GBP 66 billion. With all sectors delivering strong sales growth, our top line rose by 11%, reaching GBP 12 billion for the half year.
To note, all comparable growth rates that I'll refer to in this presentation are based on constant currency as usual. Our profit, at GBP 1.258 billion, rose by 10%, and our EPS of GBP 0.296 grew by 17%, outpacing EBIT growth, primarily from the impact of the buyback and higher interest from cash on deposit. With the benefit of high cash conversion and some advances from new orders, free cash flow approached GBP 1.1 billion. We have announced an interim dividend of GBP 0.115, and we have now moved into the final tranche of the GBP 1.5 billion buyback program that we announced this time last year. A further three-year program of up to GBP 1.5 billion has been approved to start once the current in-flight tranche is complete.
Breaking some of these numbers down a bit, I'll start with the orders, where the strength of the group's geographical diversification and the breadth of our technology are on clear display. The GBP 21 billion of orders booked at the half year paces us for another year, where orders will exceed sales, providing solid footing for continued top-line growth over the medium term. The highest order volume so far this year came from our Air Sector at GBP 8.4 billion, almost half of which came from the renewal of Typhoon support in KSA, complemented by strong MBDA and F-35 activity. Air also received continued funding for the sixth generation Tempest program and important orders for the development of next-generation radars for the Typhoon platform.
Maritime continued to grow backlog, with orders totaling GBP 4.2 billion, half of which came from accelerated Dreadnought funding and the recently announced munitions orders for the UK. P&S booked GBP 4.1 billion of orders, largely in the combat vehicles business, highlighted by the CV90 order with the Czech Republic. ES backlog is at a new record after posting orders of GBP 3.1 billion, featuring key awards, including the F-22 support and multiple awards in commercial aviation, electronic combat, and precision strike. Our cyber and intelligence sector also delivered a book-to-bill greater than one, posting GBP 1.4 billion of orders, with GBP 1 billion in our US intelligence and security business and GBP 400 million in Digital Intelligence. Moving to sales, the group increased by 11%, reaching GBP 12 billion, with good gains across all sectors.
The growth rate was flattered somewhat as sales from the first half of 2022 were still being constrained with supply chain pressures and resource challenges after COVID. Along with this low prior year base value, there was acceleration in the first half of this year on the Dreadnought program, with higher customer funding recently allocated, which helped to pace Maritime's overall 21% growth rate. P&S posted an 11% increase, also on a lower comparable H1 2022, particularly in ship repair, with increases in Hägglunds, ship repair, and higher activity at our Holston munitions location driving this year's growth. The air sector rose by 7% on higher Tempest activity, along with MBDA and air support volumes. Electronic Systems posted an 8% growth rate, led by continued recovery in civil aviation, power and propulsion, and electronic combat systems.
The cyber and intelligence business grew by 7% or 11% on a like-for-like basis after excluding the impact of the divestment and acquisition activity. The U.S. part of this business grew by 10% on increased classified work, while outside the U.S., there was a sharp increase in national security cyber sales. Moving to profit, EBIT for the half year was up 10% to GBP 1,258 million. The air sector posted the highest margin expansion to reach 12%, and Platforms & Services crossed the 9% margin threshold. The maritime sector return of 7.4% reflects the accelerated growth in the Dreadnought program, which trades in a regulated profit environment. As expected, sovereign intelligence margins of 8.3% include the investments being made in the business around space and multi-domain networking.
As we move to the second half of the year, we expect the usual H2 acceleration from Electronic Systems with a higher margin effect from mix. The group remains on course for full-year margin expansion. Operating cash flow of GBP 1.3 billion represents a GBP 900 million improvement over the same period last year. This strong performance was driven almost entirely by the air sector, which featured some cash advances on new contracts and improved working capital. Across the group, the period featured higher CapEx as we continued to invest for growth. These investments totaled GBP 300 million for the half-year, with one-third of this going to the maritime sector, which contributed to the lower cash flow for that sector.
Electronic Systems delivered GBP 157 million of cash flow, while P&S improved by GBP 80 million over the comparable period last year, including the benefit of the advances received net of some consumption. In our headquarter, the negative cash flow is a function of timing on UK VAT receivables. The strong cash delivery contributed to a continued reduction of net debt, which fell to GBP 1.8 billion at the half year. This includes the outflow of GBP 884 million from dividends and buybacks, which collectively accounted for over 80% of free cash flow for the period. Moving to guidance, with these strong interim results, we are today upgrading our guidance on all key metrics. In terms of group sales, we are moving the range up for top-line growth by 200 basis points to 5%-7%.
It's worth commenting on how we are seeing the shape of this year's sales. The pull forward of Dreadnought activity in the first half has clearly accounted for a higher variance compared to last year, giving us a more even sales weighting than usual. In the second half, Dreadnought sales will stabilize, and as a reminder, last year's second half had higher sales on the Qatar Typhoon program, which won't be repeated this year as that program matures. As reflected in our upgraded guidance, we see good sales growth for the full year, but for the reasons outlined, we won't see H1 growth repeated in H2. EBIT guidance also sees 200 basis points upgrade, taking the range to a new growth rate of 6%-8%. As mentioned, this reflects the higher returns we expect to deliver in the second half, leading to full-year margin expansion.
Earnings per share guidance is increased by 500 basis points to an improved growth rate range of 10%-12%. This increase reflects the higher profit, a lower anticipated ETR at 19%, and the higher interest from cash on deposit. For free cash flow, we are increasing our in-year guidance by GBP 600 million, taking free cash to greater than GBP 1.8 billion for the year, compared to our original guidance of greater than GBP 1.2 billion. Just to build further on the cash story, you will recall that we started giving the three year cash guides back in 2019. As you can see, since then, we have exceeded all of our three year targets. With our new in-year guidance upgrade, all current ranges have been increased by GBP 500 million.
The strong cash delivery enables us to drive value through our capital allocation policy, strengthening our business through internal investments in people, CapEx, and R&D. It allows us to continue to increase our dividends as we grow our top line and generate increasing profits through focus on strong operational delivery. In addition, on the back of our strong balance sheet, we have optionality to grow our business through a disciplined approach to M&A. As we have demonstrated, we will continue to return surplus cash to shareholders through share buybacks. Today, we are announcing a further three year buyback of up to GBP 1.5 billion, which will roll on after the completion of the current program. We aim to execute this program within three years of the completion of the current tranche.
We now have real momentum in the business, and as we move to the second half of the year and beyond, we will continue to remain focused on driving this structurally compounding business model. Thank you for listening, and we look forward to seeing many of you on the road in the coming weeks.