Weak Helo Market Triggers 3Q Decline for Leonardo

Sharply lower helicopter sales and disadvantageous foreign exchange rates contributed to a 10-percent revenue drop for Italy's Leonardo for the quarter ending September 30. The industrial defense conglomerate whose helicopter division is also the custodian of the former AgustaWestland line of rotorcraft, said quarterly revenues dropped to €2.62 billion from €3.028 billion from the year-ago period and had declined to €8.03 billion from €9.001 billion for the first nine months of the year from the same year-ago period.

Reflecting the continued softness in both the military and civil helicopter sectors, new helicopter orders fell to €580 million for the quarter from 624 from the year ago period and dropped to €1.538 billion for the first nine months of the year from €2.881 billion from the year-ago period.

The helicopter order backlog has also fallen, down to €9.669 billion for the first nine months of 2016, from €11.7 billion from the year-ago period. The helicopter earnings margins have also declined, slipping to 9.7 percent for the quarter and 11.1 percent for the year. Overall, Leonardo saw its earnings margin for the first nine months increase to 9.3 percent and its backlog swell to €35 billion, thanks to a €8 billion order from Kuwait for 28 Eurofighter Typhoons.