The defense group TKMS recorded turnover and results slightly above expectations in the first half, driven by increased demand for arms. Adjusted operating income (Ebit) increased by around 14% to 60 million euros, the company announced on Monday. Turnover increased by 10% to 1.17 billion euros. The group thus narrowly surpassed the forecasts of analysts, who on average expected an operating result of 59 million euros and a turnover of 1.1 billion euros. This growth was driven by the submarine and sonar technology divisions. Thanks to new orders, order intake reached 3.4 billion euros, bringing the order book to a new historic high of 20.6 billion euros at the end of March.
The demand for arms following Russia’s invasion of Ukraine and the American administration’s disengagement from NATO is providing European defense groups with numerous new contracts. The German leader in the sector, Rheinmetall, is also setting records. As part of their respective expansion, TKMS and Rheinmetall both aim to buy the German Naval Yards Kiel (GNYK) shipyard. Both groups submitted non-binding offers. Discussions between TKMS and the owners of GNYK are continuing ‘without any predetermined outcome’, TKMS said.
The group says it is on track to achieve its annual targets for the 2025/26 financial year. By this deadline, the adjusted Ebit margin should be above 6%. It amounted to 5.1% over the half-year. Turnover is expected to increase by 2% to 5% compared to the previous year.
(Reporting by Matthias Inverardi. Editing by Ralf Bode. For questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for business and markets).)
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