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Paris (UPI) Feb 16, 2011 French defense electronics giant Thales warned it might lose as much as $135 million in 2010 because of overruns of three key defense projects. Extra costs related to three contracts -- the Meltem maritime aircraft patrol deal in Turkey, a ticketing contract in Denmark and the troublesome Airbus A400M military transport aircraft project -- over the past two years piled up to more than $1.6 billion, Thales Chief Executive Officer Luc Vigneron said this week. But Vigneron added the latest charges, which are to cloud 2010 earnings, will probably be the last linked to the three contracts. The company is trying to renegotiate prices for systems it's supplying for the A400M, Europe's troubled military freighter built by Airbus, a daughter company of European Aeronautic, Defense and Space Co. "We can see the end of the tunnel on these projects and that allows us to be more confident on 2011 and 2012," the Financial Times newspaper quoted Vigneron as saying. In another statement that should soothe investors, Vigneron forecast more upbeat operating margins of 5 percent this year and 6 percent in 2012. Thales said sales increased by 2 percent to $17.7 billion, mainly thanks to favorable exchange rates. More cautious defense spending across Europe was "partially offset by the progressive upturn in commercial aeronautics and an exceptional order intake level in the space activities," the company added. Vigneron was appointed by the company's biggest shareholders, the French state (27 percent) and Dassault Aviation (26 percent), and has since embarked on a painful restructuring program. An electronics company with 68,000 employees, Thales is one of the 10 largest defense contractors in the world. It makes electronic devices and weapons systems used in military and civil airplanes and ships. It's part of a consortium including BAE Systems and Babcock International from Britain that is building two new aircraft carriers for the British armed forces, and is designing a drone for the British air force. After stable sales in the first half of last year, the group said it expected a return to net profit in 2010 after the company lost some $260 million in 2009. Thales will present its final results Feb. 24.
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Global defense industry in better shapeBoston (UPI) Feb 15, 2011 The global defense industry is in a better shape after the recent economic downturn, which affected both performance and profits of weapons and security equipment manufacturers and suppliers worldwide, a report released Tuesday indicated. Many of the problems for the defense manufacturers in the United States and elsewhere arose because procurement agencies cut back heavily on expenditu ... read more |
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