Ad-hoc: Rheinmetall reduces annual forecast for Defence and confirms outlook for Automotive
For the Defence division, Rheinmetall AG is reducing the sales and earnings guidance for the year as published in March 2013, but is confirming the outlook for Automotive.
Despite the fact that operating earnings (before restructuring measures) improved greatly in the second quarter of 2013 compared with the first quarter, Rheinmetall no longer expects that it will achieve the original forecast for the Defence division of EUR 130 million in operating EBIT. The forecast for operating EBIT in Defence is being reduced to a range between EUR 60 million and EUR 70 million. A decisive factor is the annual sales forecast for Defence, which has been reduced by approximately EUR 100 million from EUR 2.4 billion to EUR 2.3 billion. The main reason lies in budget cuts in key customer countries, pertaining mainly to the munitions business, in which short-term demand fell short of expectations. Rheinmetall also anticipates additional acquisition costs for high-volume programs, as well as higher execution costs for some orders.
In all, incoming orders from the Defence division remained satisfactory. In the first half of 2013, new orders amounting to EUR 1.282 billion were acquired, representing EUR 144 million or 13% more than in the previous year. The order backlog at the end of H1 2013 was EUR 5.383 billion – a 17% year-on-year increase and thus a record high. This does not regard the recent order for EUR 1.1 billion for military trucks from Australia which will be included in the Q3 figures.
For the Automotive division, Rheinmetall – following good business growth in Q2 2013 – expects to achieve the original forecast. With expected sales for 2013 of between EUR 2.4 billion and EUR 2.5 billion, EBIT before restructuring measures is estimated at some EUR 140 million.
For the Group, Rheinmetall expects annual sales of between EUR 4.7 billion and EUR 4.8 billion and EBIT before restructuring measures of between EUR 180 million and EUR 200 million. The original forecast was EUR 240 million to EUR 260 million.
Restructuring expenses for both divisions are expected to be EUR 75 million to EUR 85 million for the 2013 financial year. Of this, EUR 35 million will be for Automotive and EUR 40 million to EUR 50 million for Defence.
Rheinmetall will publish the final figures for the first half of the 2013 financial year on August 9, 2013.
Rheinmetall AGDr. Philipp von Brandenstein
Head of Corporate Communications
Rheinmetall Platz 1
Phone: +49 211 473-01
Fax: +49 211 473-4158