Europe's biggest defence contractor, BAE Systems, has reported a fall in pre-tax profits.
BAE Systems is the UK partner in the Eurofighter project
But the UK firm, which recently missed out on a £13bn RAF aircraft refuelling contract, said its defence operations this year would be slightly up on 2003.
BAE said pre-tax profits before exceptionals came in at £760m, down from £796m last year
The company was blamed in January for contributing to a £3bn overspend in the UK's annual defence budget.
BAE said it planned to expand its businesses in the US, "exploiting fully the opportunities that come from our strong market positions".
The company said that it anticipated sustained underlying growth across its operations in North America, adding that it was still on the lookout for acquisitions in the US.
BAE said a top priority for 2004 would be to reach a deal with the US allowing the transfer to Britain of sensitive military technology.
The company is currently working with US defence companies Northrop Grumman and Lockheed Martin on the Joint Strike Fighter military aircraft project.
In a statement, the company said: "Agreeing appropriate transfer of technology between the UK and the US on this programme will be a key objective during 2004."