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Italy’s Leonardo raises FY orders guidance after strong nine months

by Staff GBAF Publications Ltd
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ROME (Reuters) -Italy’s state-controlled defence group Leonardo on Thursday raised its full-year guidance after reporting a sizeable jump in orders during January-September.

In that period, new orders rose by 26.8% year-on-year to 11.719 billion euros ($11.42 billion), with a backlog equal to about 2.5 years of production.

Meanwhile, earnings before interest, taxes and amortisation (EBITA) in the period to end-September were up 2.7% to 619 million euros.

Leonardo upped its guidance for orders in the full year to more than 16 billion euros, against a previous estimate of around 15 billion euros.

Guidance for revenues was confirmed at between 14.4-15 billion euros and at 1.17-1.22 billion euros for EBITA, with both excluding the contribution of Global Enterprise Solutions for two months after the asset’s disposal became effective on Aug. 1.

Full-year forecast for free cash flow was raised slightly to around 500 million euros from around 470 million euros, again excluding the sold asset.

“The increased demand for defence and security linked to the geopolitical scenario generates positive prospects for the defence sector,” Leonardo said in a statement, in an apparent reference to Ukraine and other global flashpoints.

CEO Alessandro Profumo said the company was continuing “to manage the impact of pressures from inflation, supply chain and other challenges of the external environment”.

Leonardo’s defence and governmental business “remains strong,” he added, while its aerostructures unit was said to be in a “gradual recovery”.

In July, Leonardo landed a major deal by signing a contract with the Polish defence ministry worth 8.25 billion zlotys ($1.71 billion) for the supply of 32 AW149 helicopters.

($1 = 4.8135 zlotys)

(Reporting by Alvise Armellini; editing by Agnieszka Flak)