Leonardo is one of the companies that will publish their accounts in the coming weeks, which promise to be particularly hot for the quarterly reports of Piazza Affari. In particular, the aerospace and defense company will meet its board of directors on May 7. Market experts expect an increase in revenue and earnings on a year-on-year basis, amid geopolitical tensions that continue to support companies in the sector.
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Bloomberg’s forecasts on Leonardo’s accounts
According to Bloomberg Intelligence analysts, i revenuesi profits and the marginality by Leonardo could increase in the first quarterdriven by growth across most segments, primarily Helicopters.
I total revenues are expected in 12% growth to 3.4 billion euros, with a Ebit of 240 million (7.1% margin) and a earnings per share of 18 cents euros (slightly above the consensus, equal to 0.16 euros).
The details of the estimates by business unit
As for the Helicopter unitestimates indicate revenues increasing by 5% to 922 million euros, with a Ebita more than doubled (+106%) and a margin increase of 420 basis points, compared to greater deliveries e efficiency improvement.
The division’s revenue Electronics, Defense and Security could reach 1.7 billion euros and a Ebita of 165 million (9.4% margin), compared to a increase in military spending determined by the conflicts in Ukraine and Gaza.
The US subsidiary DRS should register a increase in revenues equal to 13% (in dollars), supported by naval propulsion and sensors.
Sales of aeronautical sector they could reach 765 million, with an Ebita of 43 million and a margin increase of 630 basis pointsthanks to further deliveries of fuselages for 787 and ATR.
Leonardo’s 2024 guidance
For 2024, Leonardo foresees a progressive growth in new orders of €19.5 billion, driven above all by the Defense and Security Electronics sector and by the recovery of the Aeronautics sector. THE revenues are expected at 16.8 billiongrowing compared to 2023 thanks to the contribution of new orders and the development of portfolio activities which reached the record value of €40 billion
In terms of profitability, Ebita is estimated to increase to €1,440 million, thanks to the growth in volumes and the confirmation of excellent levels of industrial profitability in the main business areas. The forecast also reflects the progressive recovery of the Aerostructures business while bearing in mind the difficulties in the manufacturing segment of satellites for commercial telecommunications through the subsidiary TAS.
The company has indicated a operating cash flow (FOCF) of €770 millionwith the defense and government business ensuring solid cash generation while cash absorption in Aerostructures continues albeit to a lesser extent than 2023.
In the end, Group net debt is estimated at €2.0 billionthanks to the generation of cash and net of the increased disbursement of dividends from €0.14 to €0.28 per share, new leasing contracts, strategic investments and other minor movements.
Pause after the rally since the beginning of the year
The results of the quarter could give a new boost to the stock, which has already achieved a gain more than 48% since the beginning of this year reaching a peak near 24 euros and then falling slightly to the €22 area.
Leonardo shares travel at the highest levels since the end of 2000 and close to the average target price assigned by the analysts covering the company, equal to 23 euros.
The brokers’ recommendations are divided between 13 buy opinions, 5 ‘hold’ opinions and one sell advice.