Northrop remains committed to Dubai as it pulls out of Farnborough 2012

"Northrop has the same presence at Dubai as in previous years," said show organiser Alison Weller,managing director of F&E Aerospace.

"Apart from BAE Systems, we have a full turnout of the major defence companies."

The decision by the Virginia-based company to announce a pull-out from Farnborough, the world's second largest aerospace and defence trade show was a surprise.

Northrop spokesman Randy Belote said the move did not “diminish the company's commitment to Britain or other international customers.”

In a statement to the press, Belote said the company had already been reducing its footprint at the international air shows in recent years, but pulling out completely would save millions of dollars.

"Northrop Grumman continues to focus its international business development activities and resources in areas that better support its customers' needs," he said.

Reuters reported that this would be the first time in decades that the company -- one of the five largest U.S. defence contractors -- was not present at the big international showcase of commercial and military aircraft.

Virginia-based defence consultant Loren Thompson told Reuters: "This is just the latest indication of how determined Chairman Wes Bush is to cut costs," Thompson told Reuters. "They're going to break the mould in terms of what is expected in terms of industry leaders."

Bush has realigned the company around four business areas focussed on cybersecurity, logistics, communications and intelligence, and unmanned systems, and recently spun off the company's shipbuilding business.

Northrop grumman is more exposed that the other defence contractors to the vagaries of the US financial system as more than 90% of its revenues are derived from the US Government.It has recently made major redundancies and reduced its exposure to lower-margin work

 cut headcount and reduced its exposure to lower-margin work. Northrop derives more than 90 percent of its revenue from the U.S. government.

Belote told Reuters that Northrop was reevaluating its participation in other international air shows as well, but was only prepared to announce its decision about Farnborough at this point.