Asterisks in the crisis: armaments company Rheinmetall expects extra billions from the Ukraine war

The war in Ukraine is making the armaments companies’ coffers ring, including at Rheinmetall. By 2025, sales, net income and dividends are expected to almost double compared to 2021. One hopes for a decent piece of the federal government’s 100 billion rearmament cake.

For some guns are deadly, for others it’s good business. In view of the rearmament of many NATO countries and Ukraine, the Rheinmetall armaments group has massively increased its financial targets. Compared to 2021, sales should have almost doubled in 2025, as the MDAX group announced on Wednesday at an investor event in Vienna. There should also be an upswing in profitability, so that net profit and dividends should also roughly double.

In 2025, the Düsseldorf group wants to achieve sales of between 10 and 11 billion euros. For the current year, the company, which is listed in the MDAX, has set itself the goal of around 15 percent growth in sales from its own resources compared to the 5.7 billion euros in sales in the previous year. The operating margin planned for this year at over 11 percent, which Rheinmetall uses to measure its profitability, is expected to rise to around 13 percent by the middle of the decade.

Opponents of the war block Rheinmetall armaments companies in Lower Saxony

Opponents of the war block Rheinmetall armaments companies in Lower Saxony

A lot has happened since the previous Capital Markets Day in February 2021. At that time, the medium-term goals for 2025 were much lower with sales of around 8.5 billion euros and a margin of around 10 percent. With the so-called “turning point” there was a further boost to the NATO tenor that members would have to spend more money on weapons. From the German special fund for the Bundeswehr in the amount of 100 billion euros, the German industry leader hopes to use a large proportion for its own orders. The company builds tank systems and other military vehicles, manufactures weapons and ammunition, and also supplies defense electronics.

In addition, the group is currently reducing its dependence on the auto industry, the civil division has always been more of a kind of emergency nail for more peaceful episodes. The Düsseldorf-based company no longer runs the business with combustion pistons as part of its core business, sales agreements have already been made for parts of it, and a solution is still being sought for others. The division with sensors and actuators remains in the group – essentially electronics for car drives, technology for exhaust gas aftertreatment, pumps for engines and cooling applications as well as valves. This business is set to grow with electromobility.

Revenues from military vehicles are expected to double to at least 4 to 5 billion euros by 2025 compared to 2021 – the business should therefore remain the largest division. In the particularly lucrative area of ​​weapons and ammunition, Rheinmetall boss Armin Papperger is also planning to double sales to around 2.5 billion euros – and with margins of over 20 percent, even higher profitability.

According to the US military magazine Defense News Rheinmetall’s turnover in 2000 was 2.2 billion US dollars. We will spare you the presentation in the recently used currency D-Mark.

More on the subject – NATO chief appeals to Berlin: “I expect Germany to invest more in its military”

(dpa/rt de)

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