Hensoldt margins jump on higher radar deliveries, nudges up outlook

Hensoldt Margins Surge on Higher Radar Deliveries and Raised Outlook

Hensoldt Reports Strong Financial Performance and Outlook

Profitability and Revenue Growth

Nov 5 (Reuters) - German defence electronics maker Hensoldt raised its full-year outlook slightly on Thursday after reporting stronger profitability, helped by higher deliveries of radar and optronics systems.

Hensoldt's EBITDA (earnings before interest, taxes, depreciation and amortisation) for the first nine months of the year jumped 33% to 281 million euros ($315.56 million) as revenue grew 21% to 1.86 billion euros.

EBITDA Margin Improvements

Adjusted EBITDA margin grew to 20.6% for the third quarter from 17.6% a year earlier and to 15.1% from 13.7% for the nine months.

Updated Revenue and Margin Outlook

Hensoldt nevertheless raised its revenue target only slightly to around 2.8 billion euros from around 2.75 billion euros estimated previously. It now expects an adjusted EBITDA margin of around 19%.

Segment Performance

Sensors Division

In the nine months, revenue in the company's Sensors division rose 15.5% to 1.52 billion euros, driven in part by higher deliveries of TRML-4D radars used in Diehl Defence's IRIS-T air-defence system. Adjusted EBITDA increased 18.5% to 236 million euros.

Optronics Division

Optronics posted faster growth over the same period, with revenue rising 52.4% to 354 million euros and adjusted EBITDA increasing to 45 million euros from 12 million euros a year earlier. The division supplies products ranging from vehicle sights and sensors to aircraft missile-warning and self-protection systems.

Order Intake and Backlog

Record Orders and Backlog

Order intake soared 77% to 3.56 billion euros and backlog reached a record 10.37 billion euros. With demand remaining strong, investors are increasingly focused on how quickly defence companies can convert growing order books into revenue and profit.

Currency Exchange Rate

($1 = 0.89 euros)

(Reporting by Maria Rugamer; Editing by Joyjeet Das)