Israel Aerospace Industries posts best ever year

For the third year in a row, Israel Aerospace Industries (IAI) has reported growth in sales and profits, and no less importantly, a substantial increase in EBITDA, which will boost its valuation prior to the equity offering, which the company will receive. have hope. going on this year.

Total sales in 2021 were $4.5 billion, the highest figure since the company’s inception, and an increase of 7% compared to 2020. Net profit was a record $148 million, up 11% over the prior year, while EBITDA increased 10% to $436 million. Again, the highest figure in the history of the company.

The trend is likely to sustain in the immediate future, due to an increase in the order backlog from $12.6 billion at the end of 2020 to $13.4 billion at the end of 2021. 78% of the backlog consists of orders from overseas customers.

Gross profit was $696 million in 2021, up from $665 million in 2020, and accounted for 16% of sales in both years.

Within the IAI, military groups recorded substantial growth in sales and profits, and given the conflict in Ukraine and commitments by European countries to greater defense spending, these groups are expected to grow this year and in the years to come. IAI is one of Israel’s largest exporters, with the majority (72%) of its sales going abroad, mainly to the armed forces of other countries.

Aviation Group, on the other hand, is making losses. Its sales grew 1% in 2021, while its net loss narrowed to $27 million from $32 million the previous year.

The company’s R&D spending grew 5% to approximately $1.1 billion in 2021. At the end of the year, he had $905 million in cash.

Tax expense for 2021 was $46 million. IAI pays company tax at the full rate of 23%, and as a state-owned company is not entitled to benefits under the law for promotion of investment. The sale of a small stake in the company to a non-government entity would also allow it to claim such benefits.

Sources inform the “Globes” that during a visit to the IAI yesterday, Defense Minister Benny Gantz commented on the issue, saying that he would promote the equity offering and help where there were obstacles.

IAI CEO Boaz Levy told the “Globes” that in light of increased profitability, the offering would be accelerated, and he believed the offering would take place in the second half of this year. The ball is currently with the Attorney General’s office, which is required to complete the legal process.

“We have posted record performance, substantial three-year growth in sales and profits, which goes hand in hand with a successful offering. The offering will be good for the company, its employees and the country, and so I am sure it will happen. We are working closely with employees, government ministries and government company authority. It’s a win-win for everyone, and I’m confident we’ll reach an agreement that’s right for the company and the employees.

“The offer process is taking longer than we thought, and it is impossible not to imagine how the share price would have risen had we already been on the stock exchange, but the offering will probably take place in the third or fourth quarter of this year.”

Published by Globes, Israel Business News – – on March 16, 2022.

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