Hensoldt almost doubles Q1 order intake on defence spending surge
FILE PHOTO: Flags of German defense supplier Hensoldt AG are pictured at Frankfurt stock exchange during Hensoldt’s initial public offering (IPO) in Frankfurt, Germany, September 25, 2020. REUTERS/Ralph Orlowski/File Photo
By Chiara Holzhaeuser and Paolo Laudani
(Reuters) – German defence electronics maker Hensoldt almost doubled its order intake in the first quarter, driven by rising defence spending in its main market Germany, the company said on Tuesday.
Hensoldt reported a 92% year-on-year jump in new orders in January-March to 665 million euros ($716.07 million) and a record order backlog of 5.9 billion euros.
Growth was driven by orders in the sensors segment, such as the NNbS air defence system for the German armed forces, and by additional orders for TRML-4D air defence radars, the company added.
Hensoldt’s TRML-4D radars are an integral part of the German Iris-T air defence system supplied to Ukraine.
The partly state-owned sensor maker, which last year made almost 60% of its revenue in Germany, is benefiting from ramped-up defence spending in its home country and across Europe following Russia’s invasion of Ukraine.
“The global security environment has become even more complex and volatile in recent months. This has further intensified the demands on modern security and defence solutions,” Hensoldt’s new CEO Oliver Doerre said in a statement.
French peer and defence electronics maker Thales reported strong first-quarter orders and sales last week, saying global tensions were boosting demand for air defences.
Hensoldt, which produces radar and high precision optics used in aircrafts, ships and tanks, increased its adjusted core operating profit (EBITDA) margin in the first quarter by 1.2 percentage points to 10.2%, citing operational improvements.
Hensoldt confirmed its guidance for 2024, adding that it expects first impacts from the consolidation of defence systems integrator ESG in the second quarter of the year.
The military sensor maker acquired ESG for an enterprise value of 675 million euros in December.
Leonardo, a major Hensoldt shareholder that will post first-quarter results on Tuesday, did not participate in the capital increase used to finance the deal.
($1 = 0.9287 euros)
(Reporting by Chiara Holzhaeuser and Paolo Laudani, Editing by Rachel More and Susan Fenton)