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By Cyril Altmeyer
TOULOUSE, April 10 Thales, Europe's
largest defence electronics company, said on Thursday that it
aimed to improve its margins to hit 10 percent by 2018 via a mix
of cost cuts and revenue growth from expansion in emerging
markets and civil transport and security.
Chief Executive Jean-Bernard Levy laid out the plans at the
group's first investor day in four years, which took place amid
a period of defence budget cuts that are challenging Thales and
its peers such as Cobham or BAE Systems.
Thales still relies on military business in mature markets
for about 40 percent of its sales.
Levy, who joined Thales in late 2012 after serving as boss
of media-to-telecoms conglomerate Vivendi, said Thales
would consider targeted acquisitions to expand in emerging
markets and bolster its civil aviation and security business.
It recently signed a deal to buy U.S. carrier JetBlue
Airways' LiveTV unit for $400 million.
"If we have opportunities we will try to accelerate our
growth profile to grow more in civil markets and in emerging
markets," said Levy.
"Returning to growth must be an obsession for us."
For 2014, Thales predicted a 5-7 percent rise in operating
profit, while forecasting another year of stable sales.
Levy declined to comment on reports that Thales was
interested in buying a 40 percent stake in Ansaldo STS, a
railway signalling firm, owned by Italy's Finmeccanica
The French state is Thales' largest shareholders with 27
percent, while Dassault Aviation holds 26 percent.
Thales shares closed at 49.30 euros per share on Wednesday
before the investor day, giving the group a market
capitalisation of 10.14 billion euros.
The shares fell 1.4 percent on Thursday at 7:17GMT, while
the French broad index SBF 120 was up 0.3 percent.
Analysts said that while many of Thales' goals laid out at
the investor day were expected by the market, Levy's message on
the need for acquisitions was clearer than it had been in the
(Reporting by Cyril Altmeyer; Writing by Leila Abboud; Editing
by Andrew Callus)