Leonardo confirms 2021 guidance after 37% rise in H1 core profit

Italian defence group Leonardo (LDOF.MI) stuck to its full-year guidance after its government and military business more than offset weakness in civil aviation to boost first-half earnings.

Between January and June, earnings before interest, tax and amortisation (EBITA) rose 37% over the prior year to 400 million euros.

Revenues grew 7.9% thanks to solid demand for helicopters and defence electronics. Leonardo’s aerostructure business, which makes parts for Boeing (BA.N) and Airbus (AIR.PA), saw a 35.5% fall because of the protracted negative impact of the pandemic.

Leonardo expects full-year core earnings of between 1.075 billion and 1.125 billion euros and a fall in net debt to 3.2 billion euros.

Leonardo CEO Alessandro Profumo said in a statement the group remained cautious on the timing of an eventual recovery in civil aviation despite some recent “positive signs.”

The Rome-based group also said it was sticking to a plan to list its U.S. unit DRS when market conditions allowed, after pulling the initial public offering in March due to expected cuts in U.S. defence spending.

Earlier on Thursday, Leonardo and other partners were awarded a 250 million pound contract under Britain’s Tempest fighter jet project.