Julian Moxon/PARIS
Thomson-CSF achieved a record 13% rise in orders to €7.9 billion ($8.1 billion) last year. President Denis Ranque describes the 12 months as "exceptional" for the French defence electronics company. Figures revealed by French aerospace body Gifas showed, however, that the company's performance was not replicated nationally as orders fell from the highs of the previous year.
Thomson-CSF sales rose 12%, to €6.8 billion, the €232 million loss of 1998 became a €275 million net profit and operating profit rose 10%, to €390 million. Ranque says: "This is the year we took off."
Half of the contracts were signed in countries where Thomson-CSF has local production sites, with the policy of buying into foreign companies a major feature of its activities last year. A raft of acquisitions in Australia, Brazil, Singapore, South Africa, South Korea, the UK and the USA were largely not reflected in the results, although they will feed through to boost the company's position this year.
The French company continues to expand overseas, with its Sextant subsidiary creating a joint venture with US company L-3 Communications following the latter's $255 million acquisition of Honeywell's traffic collision and avoidance system business. The French company will hold a 30% stake in the venture, which did business worth about $100 million last year.
Thomson operates in three major areas: aerospace, accounting for 20% of total business, defence (56%), with information technology and services taking the remainder. By the end of last year, its orderbook stood at €15.4 billion, representing three years' work and balanced about equally between France, other European countries and the rest of the world.
Major contracts included an airborne early warning system for Greece (€224 million), the NATO ACCS air-defence system (€210 million), South Korean air defence missile system (€220 million) and the UK's Starstreak (€110 million).
While Thomson-CSF was reporting a boom, the French aerospace industry overall did not fare so well. Orders fell by 15.4%, to €26.9 billion. Two-thirds of orders came from civil activities, with the military sector weakening, a trend further illustrated by a 45.3% drop in military exports last year as major contracts for Dassault Mirage 2000-5s to Taiwan and Qatar ended. Civil exports also slipped after a record year in 1998.
Gifas president Jean-Paul Bechat claims that France does not invest enough in aeronautics research and development, pointing to a halving of defence spending in the sector between 1994 and 1998 , and echoing recent German complaints about low investment (Flight International, 22-28 February). He says Paris "does not give the same support as the US or UK industry receives".
Source: Flight International