4 Min Read
* Adjusted Q4 EPS $1.26 vs $1.41 forecast
* Q4 revenue $811.5 mln vs $840 mln forecast
* Backlog of orders up at $5.82 bln
* Shares down 2.9 pct on Nasdaq (Adds comments from CEO on outlook, share reaction)
By Tova Cohen
TEL AVIV, March 19 (Reuters) - Cyber security and aviation products will help drive growth for Elbit Systems in 2014, the Israeli defence electronics firm said on Wednesday after it reported lower quarterly profit and sales that missed analysts' estimates.
Outlays on large defence platforms by governments around the world have slowed in recent years but Elbit specialises in some niche segments that are in demand. It said it expected strong revenue growth in India, Australia and Latin America.
Chief Executive Bezhalel Machlis said fourth-quarter results were hit by the time it took to execute certain projects and that it was more important to look at 2013 annual results, which showed growth, as well as the firm's strong backlog of orders.
"Elbit is on a trend of growth that will be reflected in 2014," he told Reuters.
"Recently we implemented some organisational changes to enhance our market position in the areas of cyber and intelligence systems as well as commercial avionics systems," he said.
"We consider both of these areas as growth engines for the company and complementary to our traditional defence-based business lines."
Machlis, who became CEO last April, said a new generation of its enhanced vision system, which allows pilots to see through fog and clouds using infrared, was recently selected by Dassault for its Falcon aircraft. The size of the deal has not been disclosed.
The company earned $1.26 per diluted share excluding one-time items in the fourth quarter, down from $1.62 a year earlier. Revenue slipped to $811.5 million from $843.9 million.
Elbit, Israel's largest publicly traded defence company by revenue and market capitalisation, was forecast to earn $1.41 a share on revenue of $840 million, according to Thomson Reuters I/B/E/S.
Its backlog of orders rose to $5.82 billion at the end of 2013 from $5.68 billion a year earlier.
Elbit shares were down 2.1 percent to 208.9 shekels in afternoon trade in Tel Aviv. Its Nasdaq shares opened 2.9 percent lower at $60.11.
Asia-Pacific and Latin America present strong opportunities, the company said. The United States, which accounts for a third of Elbit's business, is also growing though Europe, which accounts for 20 percent, is flat.
Revenue in 2013 rose to $2.93 billion from $2.89 billion in 2012 while EPS excluding one-off items rose to $4.99 from $4.88.
Machlis said he saw potential for $2-$3 billion of new orders in Latin America in the next three years, as well as $2-$3 billion in Australia and $3-$4 billion in India.
Elbit plans to grow organically and through acquisitions, the CEO said. "We are prepared financially to make a significant acquisition; we are looking in our target markets," he added.
The company declared a dividend of 30 cents per share for the fourth quarter, the same as for the third quarter. (Editing by Steven Scheer and Pravin Char)