TKMS, the defence business that German conglomerate Thyssenkrupp aims to spin off this autumn, plans to raise its profit margin to more than 7% to close a gap with rivals, banking on
TKMS, the defence business that German conglomerate Thyssenkrupp aims to spin off this autumn, plans to raise its profit margin to more than 7% to close a gap with rivals, banking on soaring military demand amid fears of Russian aggression.
TKMS, which makes submarines, frigates as well as sensor and mine-hunting technology, has more than tripled its order backlog in five years. It now stands at 18.6 billion euros ($21.8 billion) as governments around the world beef up warship fleets.
In the medium term, TKMS plans to raise its operating profit margin to more than 7%, compared with 4.3% in the 2023/24 fiscal year, and is targeting average annual sales growth of 10%, it said on Tuesday at a capital markets day.
Fuelled By Geopolitical Momentum
"As TKMS, we are not only ideally positioned for the spin-off, but also to meet the dynamic demand of the market," TKMS CEO Oliver Burkhard said.
TKMS has helped parent Thyssenkrupp's TKAG.DE shares to triple in value this year, as investors have flocked to defence stocks amid Russia's war in Ukraine and dwindling certainty over U.S. military support for Europe.
TKMS expects its addressable market to double to 61 billion
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