Elbit Systems revenue exceeds $1b in Q4

Bezhalel Machlis

The company reported $3.4 billion in revenue in 2017, 3.6% more than in 2016, while fourth quarter net profit grew 3.4%.

Israeli defense electronics company Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT), managed by CEO Bezhalel Machlis and controlled by the Federman family, finished 2017 with $3.4 billion in revenue, 3.6% more than in 2016. The company's sales of land-based systems improved as a result of increased sales in Europe of electronic warfare systems and tanks systems. Elbit Systems also benefited from a rise in sales of electro-optical systems, featuring sales growth in air intelligence systems, night vision systems in the Asian Pacific region, and airplane defense systems in other regions.

On the other hand, sales of computer systems (communications and computers) fell as a result of lower sales of command and control systems and unmanned aerial systems (UAS) in Latin America.

Elbit Systems' operating profit grew 6.7% to $319.3 million in 2017, 9.5% of revenue. One factor was lower management and general expenses mainly due to revaluation of liabilities involving assets and activities in previous years.

The company's fourth quarter revenue grew 6% to $1 billion, and its operating profit was $103 million, up 18.3%, compared with the corresponding quarter in 2016. Elbit Systems' fourth quarter net profit grew 3.4% to $69 million.

The company's orders backlog stood at $7.6 billion at the end of 2017, compared with $6.9 billion at the end of 2016. 73% of Elbit Systems' orders backlog consisted of orders from foreign customers, and 65% of it consisted of orders for delivery in 2019. Elbit Systems announced the distribution of a dividend of $0.44 per share. The share price of the company, which has seen its orders from customers for security equipment increase in both Israel and overseas in recent years, posted a 250% jump in orders over the past five years. Its market cap is NIS 20 billion.

As for the acquisition of Israel Military Industries Ltd. (IMI) by Elbit Systems, which the Ministry of Finance approved last week, the company said, "The company is continuing its talks with the Israeli government about the terms for completing the transaction."

When the reports were published, Machlis said, "We are seeing a number of defense budgets globally on the rise, with the areas in which we focus receiving increased priority. Our business is geographically diverse, divided fairly evenly among North America, Europe, Israel and Asia-Pacific, providing an additional element of stability to our business.” He added, "The continued backlog growth we have witnessed over the past few quarters translated into fourth quarter revenue growth of 6% year-over-year. All this has enhanced Elbit Systems’ position as a leading global provider of technologically advanced defense and homeland security solutions."

Commenting on Elbit Systems' acquisition of IMI, Machlis said, "We will be proud to acquire IMI: it has rights and achievements that contributed greatly to the country's security. Our actions in previous acquisitions, such as Elisra, Tadiran Communications, and Soltan show that Elbit Systems has the experience and ability to translate these transactions into more jobs, growth in sales and exports, and better profit margins."

Published by Globes [online], Israel Business News - www.globes-online.com - on March 20, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

Bezhalel Machlis
Bezhalel Machlis
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