In This Article:
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Group Revenue: EUR2.305 billion, a 46% increase.
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Defense Sales: EUR1.795 billion, a 33% increase.
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Operating Results (Defense): EUR206 million, a 96% increase.
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Operating Margin (Defense): 11.5%.
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Group Operating Margin: 8.7%.
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Operational Free Cash Flow: EUR266 million.
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CapEx: 6.6% of revenue.
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Order Backlog: EUR62.56 billion, a 56% increase.
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Vehicle Systems Sales: EUR952 million, nearly doubled.
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Weapon and Ammunition Sales: EUR599 million, a 66% increase.
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Electronics Solutions Sales Growth: 50% increase.
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Power Systems Sales: EUR505 million, a 7% decline.
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Equity Ratio: 33.6%.
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Net Financial Position: Improved to minus EUR600 million.
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Net Debt-to-EBITDA Ratio: 0.34%.
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Rheinmetall AG (RNMBF) reported a 46% increase in group sales, reaching EUR2.305 billion, with defense sales growing by 33% to EUR1.795 billion.
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The defense segment's operating margin reached a record 11.5%, contributing significantly to the group's overall margin of 8.7%.
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The company received 70,000 job applications in Q1, indicating strong interest and ability to attract talent.
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Rheinmetall AG (RNMBF) has a robust order backlog of EUR62.56 billion, with expectations to convert frame contracts into fixed contracts, providing long-term planning security.
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The company is expanding its production capabilities, including a joint venture with Lockheed Martin to produce missiles in Europe, aiming for a potential annual sales volume of EUR5 billion.
Negative Points
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The civilian business segment is struggling, with a 7% year-on-year decline and a low profit margin of 1.8%.
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There is a delay in ammunition production due to a fire in Murcia, potentially impacting Q2 sales by EUR200 million.
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The company's CapEx is slightly above the normal rate, indicating a need for increased investment to meet future demands.
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Rheinmetall AG (RNMBF) faces challenges in converting frame contracts to fixed contracts, which could affect the timing of revenue recognition.
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The ambitious growth targets, including a potential EUR55 billion order intake, depend heavily on political decisions and the speed of contract finalizations, which may not materialize as quickly as anticipated.
Q & A Highlights
Q: Mr. Papperger, regarding the new nomination guidance of over EUR55 billion, is this consistent with the previous guidance of EUR50 billion to EUR100 billion? Could the EUR55 billion end up being higher in the second half? A: The real push will come next year due to timing. We expect more than EUR55 billion for this year, but the bulk will come next year and the year after. The potential is EUR300 billion to EUR400 billion by 2030.