Increased military spending prompted by Russia’s war on Ukraine and the Israel-Gaza conflict helped the British weapons manufacturer BAE Systemsto record profits last year, with further growth expected in the year ahead.

The FTSE 100 company made underlying profits before interest and tax of £2.7bn on record sales of £25.3bn in 2023.

Shares in weapons manufacturers have surged in the past two years after Russia’s full-scale invasion of Ukraine in February 2022 made governments reassess their plans for military spending.

There have also been increased tensions across the Middle East since 7 October, when Hamas, which runs Gaza, killed 1,139 people in an assault on Israel. Israel has responded with months of bombardment of Gaza, killing nearly 30,000 Palestinians.