Rheinmetall Reports Record Profit and Orders Amid Ongoing Military Spending Boom
Rheinmetall, a German defense and automotive company, has announced a record-breaking year, with a significant increase in orders and revenue. The company’s defense segment, which accounts for around 80% of its total revenue, has seen a 50% surge in sales, contributing to the overall growth.
The company’s order backlog has reached a new high of 55 billion euros, a 44% increase from the previous year. Rheinmetall’s operating result has also reached a new record of 1.478 billion euros, a 61% increase from the previous year. The company’s operating margin has risen to 15.2%, with the defense segment achieving a margin of 19%.
Rheinmetall’s CEO, Armin Papperger, expressed optimism about the company’s future, stating that it is well-positioned to take advantage of the growing demand for defense technology in the wake of the Ukraine war.
The company’s financial performance is a result of its significant investments in recent years, which have enabled it to expand its production capacity and secure its supply chains. Rheinmetall has also been expanding its global presence, with new production facilities and partnerships in various countries, including the United States, the United Kingdom and Eastern Europe.
The company’s success is not without controversy, however. The German Federal Auditing Office has raised concerns about a large IT project awarded to Rheinmetall without a regular tendering process, warning of potential “investment ruins” and unclear system readiness. The project, which is expected to cost around 5.5 billion euros over the next decade, has sparked criticism and concerns about the potential impact on the German taxpayer.