Leonardo: 1H 2018 Revenues up 4%, before currency impact.

Leonardo's Board of Directors, convened today under the Chairmanship of Gianni De Gennaro, examined and unanimously approved the results of the first half 2018.

Rome  30 July 2018 17:49 Inside Information

  • 2018 Orders and FOCF Guidance revised upwards
  • Helicopters successfully achieving the recovery plan
  • DRS benefitting from strong US market
  • Fully focused on executing the Industrial Plan

First half results in line with expectations

  • New order intake at € 4.6 billion
  • Revenues at € 5.6 billion
  • EBITA at € 470 million and Profitability (RoS) at 8.4%
  • Group Net Debt at € 3.5 billion
  • FOCF amounted to negative € 809 million

Progress and strong performance in key areas of the Group

  • July 2018 Helicopter deliveries overtaking vs. July 2017; ca. 90 units delivered so far vs. 85 units at the end of July 2017
  • DRS long-term growth supported by «soft backlog»

Steps forward executing the Industrial Plan

  • Competence mix change supported by early retirement plan, enabling Leonardo to meet evolving requirements of the market
  • € 170 mln. one-off early retirement costs accounted for in 1H 2018, allowing also a generational and competence mix change; with no effect on 2018 FOCF

2018 Orders and FOCF Guidance revised upwards

Leonardo's Board of Directors, convened today under the Chairmanship of Gianni De Gennaro, examined and unanimously approved the results of the first half 2018.

Alessandro Profumo, Leonardo CEO, commented: “First half 2018 results are in line with expectations. We are fully focused on executing the Industrial Plan: Helicopters are successfully recovering, DRS is benefitting from US market improvement and we have taken steps forward in cost control. All of these will ensure long-term sustainable growth to the Group”.

Highlights of 1H 2018 results are as follows:

  • New Orders: amounted to EUR 4,604 million, ca. EUR 4,755 million excluding the negative exchange rate effect of ca. EUR 150 million.
  • Order Backlog: amounted to EUR 32,611 million, ensures a coverage of about three years of equivalent production.
  • Revenues: amounted to EUR 5,589 million, ca. EUR 5,720 million, +4% YoY, if we exclude the negative exchange rate effect of ca. EUR 130 million.
  • EBITA: amounted to EUR 470 million, ca. EUR 480 million excluding the negative exchange rate effect of ca. EUR 10 million. The slight decrease YoY was mainly attributable to Helicopters that, even if it recorded results in line with forecasts, saw a particularly positive second quarter of 2017 in terms of mix of operations.
  • EBIT: amounted to EUR 240 million, EUR 410 million excluding one-off early retirement costs of  EUR 170 million due to the agreement signed with the Italian Unions (under Law 92/2012 - “Fornero Act”) aimed at improving competence mix to meet the evolving requirements of the market (with no effect on 2018 FOCF). 
  • Net Result: amounted to EUR 106 million, EUR 236 million excluding the effect of the above mentioned one-off early retirement costs (+11% YoY), benefitted from lower financial costs as a result of the buy-back operations and the redemption of bond issues that were completed during 2017.
  • Group Net Debt: amounted to EUR 3,474 million, showed an improvement compared to the first half of 2017, while the figure showed an increase compared to 31 December 2017, which was due to the seasonal trend in cash flows and to the payment of dividends (EUR 81 million).
  • Free Operating Cash Flow (FOCF): amounted to negative EUR 809 million, showed a change in comparison with the first half of 2017 (EUR -531million) chiefly due to the financial profile of the EFA Kuwait contract in the two comparative periods together with the start of production operations; a circumstance that was largely expected.


The Board of Directors has decided to revise upwards the Group Guidance for the full year 2018 to reflect the expected effectiveness of the contract from the Ministry of Defence of Qatar for NH90 multirole helicopters, that had been only partially factored into Group Guidance, and the potential for certain export campaigns not to be full finalised by year-end. The new 2018 guidance is as follows: 


  Exchange rate assumptions €/USD 1,20 and €/GBP 0,90
  Guidance Revised guidance
New Orders (€bn.) 12,5 - 13,0 14,0 – 14,5
Revenues (€bn) 11,5 – 12,0 11,5 – 12,0
EBITA (€mln) 1.075 - 1.125 1.075 - 1.125
FOCF (€mln)  ca. 100 300 – 350
Group Net Debt (€bn) ca. 2,6 ca. 2,4



(Euro million)
1H 2018 1H 2017 restated Chg. Chg. % FY 2017 restated
New orders 4.604 5.061 (457) (9,0%) 11.595
Order backlog 32.611 33.918 (1.307) (3,9%) 33.507
Revenues 5.589 5.496 93 1,7% 11.734
EBITDA 671 780 (109) (14,0%) 1.602
EBITA (*) 470 505 (35) (6,9%) 1.077
ROS 8,4% 9,2% (0,8) p.p.   9,2%
EBIT (**) 240 423 (183) (43,3%) 844
EBIT Margin 4,3% 7,7% (3,4) p.p.   7,2%
Net result 106 213 (107) (50,2%) 279
Group Net Debt 3.474 3.577 (103) (2,9%) 2.579
FOCF (809) (531) (278) (52,4%) 537
ROI 13,0% 13,5% (0,5) p.p.   15,4%
ROE 5,0% 10,0% (5,0) p.p.   6,5%
Research and development expenses 708 601 107 17,8% 1.539
Workforce (no.) 45.989 45.655 334 0,7% 45.134



(*)EBITA is obtained by eliminating from EBIT the following items: any impairment in goodwill; amortisation and impairment, if any, of the portion of the purchase price allocated to intangible assets as part of business combinations, restructuring costs that are a part of defined and significant plans; other exceptional costs or income, i.e. connected to particularly significant events that are not related to the ordinary performance of the business.

(**) EBIT is obtained by adding to earnings before financial income and expense and taxes the Group’s share of profit in the results of its strategic Joint Ventures (ATR, MBDA, Thales Alenia Space and Telespazio).