The Russian war of aggression against Ukraine and NATO’s armament plans are filling Rheinmetall’s order books. The group is fully committed to growth.
The arms company Rheinmetall expects increasing sales and profits as a result of the Russian invasion of Ukraine and the armament of NATO countries. For 2026, the group expects sales of between 13 and 14 billion euros, explained Rheinmetall boss Armin Papperger in a presentation for an investor day. The company would almost double its sales compared to 2023.
In addition, Rheinmetall wants to operate significantly more profitably in the future than it did this year. The profit margin should exceed 15 percent, it was said. Rheinmetall had set its target for group sales without acquisitions in a range of 7.4 to 7.6 billion euros for 2023. The company is fully on track to achieve these goals, the presentation said.
The Düsseldorf-based group has expanded its production capacities in view of the turning point announced by Chancellor Olaf Scholz in the wake of Russia’s war of aggression against Ukraine and the expected boom in orders. The company also supplies Ukraine with weapons and ammunition.
USA as a “new home market”
“Rheinmetall is needed when it comes to meeting the dramatically increased needs of many countries for military equipment,” Papperger said at the beginning of November. At the investor conference, the group emphasized that the defense budgets of NATO countries continued to rise as a result of the Ukraine war.
The Düsseldorf group’s divisions involved in the defense business alone expected sales of around eleven billion euros by 2026. The operating margin target here is around 17 percent or above. The order books are full to the brim. Rheinmetall is focusing on strong growth, especially in the USA. The country has the potential to become a “new home market” by the end of the decade. Among other things, Rheinmetall wants to deliver a successor to the US Bradley infantry fighting vehicle there.
The goals announced by the group are well received by investors. The defense company’s stocks rose by up to four percent in the morning and left the other DAX stocks behind.