British defence group BAE Systems said it was still in talks with Saudi Arabia to finalise the terms of a key fighter jet contract and reiterated its caution for the coming year given government cutbacks.

'Whilst little sales growth can be expected for the group in 2012 in the current market conditions, modest growth in underlying earnings per share is anticipated, assuming a satisfactory conclusion to Salam negotiations in 2012,' BAE said in a statement on Wednesday.

In 2007 Saudi Arabia signed a contract with BAE to buy 72 Typhoon aircraft, 24 of which have been delivered to the Royal Saudi Air Force. The Salam deal - as it is known - is worth around 4.5 billion pounds ($7.3 billion).

Earlier this month BAE said the contract to build the remaining 48 jets in Britain had been signed but said changes to the price of the deal had yet to be agreed.

'Salam trading ... remains deferred until ongoing negotiations have been concluded,' BAE said, adding that contracts valued at 400 million pounds had been received to date.

The company said it had submitted a proposal to the government of Oman to sell it 12 Eurofighter Typhoon jets with a five-year support, pilot and ground crew training package.

BAE added that it expects to receive an order to supply the Norwegian armed forces with 144 CV90 vehicles and initial support, in a deal worth around 500 million pounds.

BAE, Europe's biggest defence contractor, said the approval of the US' 2012 defence budget had resulted in less disruption to the award of contracts than in 2011 but that delays to the approval of 2013 budgets were likely. - Reuters