Elbit Systems Awarded Approximately $270 Million Contract to Supply Rocket Artillery for an International Customer

Rhea-AI Summary

Elbit Systems (NASDAQ: ESLT) (TASE: ESLT) has secured a significant contract worth approximately $270 million to supply rocket artillery to an international customer. The contract, announced on August 6, 2024, will be executed over a 4-year period. This agreement underscores Elbit Systems' strong position in the advanced artillery solutions market and its ability to enhance clients' operational capabilities with cutting-edge technologies.

Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems, emphasized that this contract reaffirms the company's leadership in providing advanced artillery solutions. The deal is expected to bolster Elbit Systems' revenue stream and reinforce its global presence in the defense sector.

Positive

• Secured a $270 million contract for rocket artillery supply
• Contract to be executed over a 4-year period, providing steady revenue
• Reinforces Elbit Systems' position as a leading provider of advanced artillery solutions
• Expands international customer base

Negative

• None.

Insights

Financial Analyst

The $270 million contract for Elbit Systems is a significant win, representing approximately 10% of the company's annual revenue based on recent financials. This 4-year deal provides a stable revenue stream, enhancing earnings visibility for investors. The rocket artillery sector is experiencing growth due to global geopolitical tensions, positioning Elbit well in this market.

While the customer remains undisclosed, international sales diversify Elbit's revenue base, potentially reducing geopolitical risks. However, investors should note that defense contracts can be subject to political shifts and budgetary constraints. The contract's impact on margins will be important to monitor in upcoming earnings reports.

Defense Industry Expert

Elbit's success in securing this substantial artillery contract underscores its strong position in the precision-guided munitions market. The company's advanced technologies, including smart fuses and guidance systems, likely played a pivotal role in winning this deal. This contract not only bolsters Elbit's order backlog but also enhances its reputation as a top-tier defense supplier.

The 4-year timeline suggests a comprehensive system delivery, possibly including training and support services. This long-term engagement could lead to follow-on contracts and deeper customer relationships. However, the defense market is highly competitive and maintaining technological edge will be important for Elbit to secure future deals of this magnitude.

Geopolitical Analyst

The $270 million rocket artillery contract signals a growing trend of nations bolstering their long-range strike capabilities. This reflects the evolving nature of modern warfare, emphasizing standoff precision engagement. While the customer is unnamed, such significant artillery purchases often indicate regional tensions or modernization efforts.

For investors, this contract highlights Elbit's ability to capitalize on global defense spending trends. However, it's important to consider the ethical implications and potential reputational risks associated with arms exports. Future growth in this sector may be influenced by international arms control agreements and shifting geopolitical alliances, factors that could impact Elbit's long-term business prospects.

HAIFA, Israel, Aug. 6, 2024 /PRNewswire/ -- Elbit Systems Ltd. (NASDAQ: ESLT) (TASE: ESLT) ("Elbit Systems" or the "Company") announced today that it was awarded a contract worth approximately $270 million to supply rocket artillery to an international customer. The contract will be performed over a period of 4 years.

Bezhalel (Butzi) Machlis, President and CEO of Elbit Systems: "This contract reaffirms Elbit Systems' position as a leading provider of advanced artillery solutions, enhancing the operational capabilities of our clients with cutting-edge technologies."

About Elbit Systems

Elbit Systems is a leading global defense technology company, delivering advanced solutions for a secure and safer world. Elbit Systems develops, manufactures, integrates and sustains a range of next-generation solutions across multiple domains.

Driven by its agile, collaborative culture, and leveraging Israel's technology ecosystem, Elbit Systems enables customers to address rapidly evolving battlefield challenges and overcome threats.

Elbit Systems employs over 19,000 people in dozens of countries across five continents. The Company reported as of March 31, 2024 approximately $1.6 billion in revenues and an order backlog of $20.4 billion.

For additional information, visit: https://elbitsystems.com, follow us on Twitter or visit our official Facebook, Youtube and LinkedIn Channels.

Company Contact:  

Dr. Yaacov (Kobi) Kagan, Executive VP - CFO
Tel:  +972-77-2946663
kobi.kagan@elbitsystems.com

Dr. David Ravia, Investor Relations
Tel: +972-77-2947169
david.ravia@elbitsystems.com

Dalia Bodinger, VP, Communication & Brand
Tel: 972-77-2947602
dalia.bodinger@elbitsystems.com

This press release may contain forward–looking statements (within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Israeli Securities Law, 1968) regarding Elbit Systems Ltd. and/or its subsidiaries (collectively the Company), to the extent such statements do not relate to historical or current facts. Forward-looking statements are based on management's current expectations, estimates, projections and assumptions about future events. Forward–looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions about the Company, which are difficult to predict, including projections of the Company's future financial results, its anticipated growth strategies and anticipated trends in its business. Therefore, actual future results, performance and trends may differ materially from these forward–looking statements due to a variety of factors, including, without limitation: scope and length of customer contracts; governmental regulations and approvals; changes in governmental budgeting priorities; general market, political and economic conditions in the countries in which the Company operates or sells, including Israel and the United States, among others, including the duration and scope of the current war in Israel, and the potential impact on our operations; changes in global health and macro-economic conditions; differences in anticipated and actual program performance, including the ability to perform under long-term fixed-price contracts; changes in the competitive environment; and the outcome of legal and/or regulatory proceedings. The factors listed above are not all-inclusive, and further information is contained in Elbit Systems Ltd.'s latest annual report on Form 20-F, which is on file with the U.S. Securities and Exchange Commission. All forward–looking statements speak only as of the date of this release. Although the Company believes the expectations reflected in the forward-looking statements contained herein are reasonable, it cannot guarantee future results, level of activity, performance or achievements. Moreover, neither the Company nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. The Company does not undertake to update its forward-looking statements.

Elbit Systems Ltd., its logo, brand, product, service and process names appearing in this release are the trademarks or service marks of Elbit Systems Ltd. or its affiliated companies. All other brand, product, service and process names appearing are the trademarks of their respective holders. Reference to or use of a product, service or process other than those of Elbit Systems Ltd. does not imply recommendation, approval, affiliation or sponsorship of that product, service or process by Elbit Systems Ltd. Nothing contained herein shall be construed as conferring by implication, estoppel or otherwise any license or right under any patent, copyright, trademark or other intellectual property right of Elbit Systems Ltd. or any third party, except as expressly granted herein.

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SOURCE Elbit Systems Ltd.

FAQ

What is the value of Elbit Systems' new rocket artillery contract?

Elbit Systems (ESLT) has been awarded a contract worth approximately $270 million to supply rocket artillery to an international customer.

How long will it take Elbit Systems to fulfill the rocket artillery contract?

The contract awarded to Elbit Systems (ESLT) for rocket artillery supply will be performed over a period of 4 years.

Who is the customer for Elbit Systems' $270 million rocket artillery contract?

The customer for Elbit Systems' (ESLT) $270 million rocket artillery contract is described as an international customer, but specific details are not provided in the press release.

When did Elbit Systems announce the $270 million rocket artillery contract?

Elbit Systems (ESLT) announced the $270 million rocket artillery contract on August 6, 2024.