Home reports Industry Rheinmetall continues to grow as expected

Rheinmetall-Konzernzentrale-_Rheinmetall — With sales up 16 percent to 6.4 billion euros and record earnings of 754 million euros (up 27 percent), the 2022 financial year was extremely successful for the Rheinmetall armaments group. (Photo: Rheinmetall)

Rheinmetall continues to grow as expected

August 14, 2023

In the first half of 2023, sales at the Düsseldorf-based technology group Rheinmetall grew by seven percent to 2.9 billion euros. The result could not keep up and fell by seven percent to 191 million euros. This was offset by strong growth of 17 percent in the order backlog, which surpassed the EUR 30 billion mark for the first time.

Rheinmetall attributes the growth primarily to business with the armed forces in Germany and partner states in the EU and NATO. Orders from the military areas would have shown double-digit sales growth. "We recently signed contracts with an order volume of over seven billion euros in a single week," reported Armin Papperger, CEO of Rheinmetall AG. The Electronic Solutions, Vehicle Systems and Weapon and Ammunition divisions are the main drivers of the positive developments.

The Group's top-selling division, Vehicle Systems, was able to generate 1,012 million euros, 19 percent more than in the previous year. The operating result improved by almost a quarter to 99 million euros. With incoming orders five times higher, the order book grew to EUR 3,725 million. Rheinmetall named the Bradley successor in the USA as new major orders, new Puma infantry fighting vehicles and new military trucks for the Bundeswehr, trucks for Austria and Leopard 2 for Norway.

The Weapon and Ammunition division earned six percent more than in the previous year. In particular, higher orders for ammunition and the production of protected truck cabins and ship protection systems MASS (for Australia) contributed to the turnover of 598 million euros. Only 1,561 million euros are left in the order book. Rheinmetall attributes the drop of 331 million euros to the above-average individual order from Hungary last year. However, the result in this division also increased by 27 percent to 89 million euros.

The Electronic Solutions division was able to increase its sales by ten percent to 450 million euros. Earnings increased at almost the same rate by EUR 2 million to EUR 27 million. The order backlog increased significantly by 16 percent to 3.4 billion euros, partly due to an order in connection with the Puma infantry fighting vehicle.

In the two automotive divisions, "Sensors and Actuators" achieved sales that increased by two percent to 707 million euros, with earnings more than halved to 220 million euros. The order book grew by 22 percent to 8.2 billion euros. "Materials and Trade" had to accept a drop in sales of six percent to 352 million euros and a drop in earnings of almost 38 percent to 17 million euros. Rheinmetall cites a cyber attack in a sub-area of the division as one reason. The weakness is also reflected in the order backlog, which fell by EUR 10 million to EUR 600 million.

The three "Defence" divisions contributed around two-thirds to sales and 85 percent to the Group's earnings. Just a few years ago, the automotive divisions dominated the group.

For the 2023 financial year, Rheinmetall confirms the forecast made in spring, according to which annual sales are expected to be around 7.5 billion euros and earnings in the order of 900 million euros. The well-filled order books of the divisions form the basis for this.

gwh / editors

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