Elbit tight-lipped on "considerable increased demand" from Israel Ministry of Defense
Elbit tight-lipped on "considerable increased demand" from Israel Ministry of Defense
Elbit wrote that “since the beginning of the Swords of Iron War, it has been awarded a series of contracts by the Israel Ministry of Defense (IMOD) in an aggregate amount that is material to the company,” but refused to provide additional details
Elbit Systems announced on Monday that it has secured several contracts on behalf of the Israeli Ministry of Defense since the outbreak of the Iron Swords War, amounting to a substantial cumulative value. However, specific details such as the number of contracts, included products, delivery dates, agreement periods, and financial scope remain undisclosed.
Elbit wrote that “since the beginning of the Swords of Iron War, it has been awarded a series of contracts by the Israel Ministry of Defense (IMOD) in an aggregate amount that is material to the Company.”
Controlled by Mickey Federmann (44%), Elbit is traded on the Tel Aviv and Nasdaq Stock Exchanges. Despite reporting over 20 transactions, including sales to the Ministry of Defense since the beginning of the year, the current announcement refrains from providing the usual additional details on the financial scope and products involved.
Responding to Calcalist's inquiry, Elbit Systems emphasized its commitment to report fully and accurately with transparency, and stated that the Ministry of Defense's order volume fluctuates regularly. Due to the sensitive nature of the deals, the company refrained from disclosing full details in this report. The company pledged to include the data in its financial statements as required and continues to update on material transactions in compliance with the law.
The Securities Authority, responding to Calcalist's inquiry, noted that Elbit is a dual company reporting according to American law. Engaged in manufacturing and marketing various defense systems and products, Elbit relies heavily on the IDF and the U.S. government for revenues, accounting for 17% and 19% respectively in 2022. The increased demand from the Ministry of Defense, especially due to the ongoing war, is expected to generate substantial revenue.
Among the Elbit products used by the IDF are precision rockets, mortar bombs and tank shells. During the war in Gaza, Elbit's "Iron Sting" accurate mortar munition was also exposed.
"In our understanding, this is a combination of many small transactions in various areas of the company's activity," said Shahar Carmi, a senior analyst at Psagot Investment House, in a conversation with Calcalist in reference to Elbit's report. "The company stated that this is a substantial amount in the aggregate, therefore we estimate that the orders are several hundred million dollars, some of them for immediate delivery. This is a good amount, but in our estimation it is not an order that will affect the company dramatically, since it is a large and diversified company and has long held a large backlog of orders. Of course any report on orders is positive.”
Over 80% of Elbit's sales are to the global market. In the first nine months of the year, it sold to the IDF in the amount of $730 million compared to sales of about $1.3 billion to European countries, about $1 billion in the North American market and a similar amount to countries in Asia and the Pacific Ocean. Its sales during this period grew by almost 9% compared to the corresponding period last year and amounted to approximately $4.3 billion, and at the end of the third quarter its order backlog amounted to approximately $16.6 billion.
