European missiles house expects another sales increase after solid 2003 performance
Europe's leading guided- weapons manufacturer, MBDA, is predicting a 30% increase in sales this year, building on a similar performance in 2003 prompted largely by a spike in business for the company's air-launched weapons sector.
MBDA recorded sales of €2.4 billion ($2.9 billion) last year and received new orders worth €4.3 billion, placing it second in the global guided-weapons sector behind the USA's Raytheon. The company also ended the year with an order backlog of €14.8 billion. Its 2003 sales performance was 34% up on the previous year's €1.8 billion, with this largely attributed to several airborne weapons projects moving out of their development phases.
"This is a business that is in transition from development to very substantial volumes of production," says MBDA chief operating officer Guy Griffiths. The company expects to deliver around 8,000 missiles a year by 2006, up from nearly 3,000 last year. Annual sales are also projected to reach €3.2 billion by this time. The growing air-defence missile sector is expected to provide much of this growth, against a decline in demand for battlefield anti-armour weapons and a static market for air-launched missiles in the 2004-8 period.
Owned by BAE Systems (37.5%), EADS (37.5%) and Finmeccanica (25%), MBDA employs around 10,000 people worldwide: 5,300 in France, 1,300 in Italy, 3,000 in the UK and around 100 in the USA. Key business objectives remain the long-planned integration of EADS's 100%-owned LFK subsidiary to form MBDA Deutschland and the formation of a Spanish missile business together with Indra and Izar.
"We have been working very hard over the first six months of this year to get our shareholders' views to meet on LFK," says MBDA chief executive Marwan Lahoud.
Discussions to agree a fair price for the business with EADS are at "a quite advanced stage" and an agreement could be reached from later this year, he says.
Afurther objective is to expand MBDA's business in the USA. It recently secured a small but significant contract to manufacture its Diamond Back wing-kit for Boeing's 110kg (250lb) small-diameter bomb, but Lahoud concedes that "US suppliers aren't going to stand aside" when it attempts to promote other designs.
MBDA also aims to reach a double-digit return on sales in 2006, up from 5% last year. This will be achieved both by increasing sales and removing duplication from its supply chain by increasing vertical integration within the company, says Griffiths.
CRAIG HOYLE / STEVENAGE
Source: Flight International
