PARIS (Reuters) – Thales recorded a sharp decline on the Paris Stock Exchange on Tuesday, penalized by order intake considered disappointing in the third quarter despite an increase in its turnover over the period.

The French equipment manufacturer for aerospace, defense and security indicated that its order intake declined by 18% in organic data over the January-September period compared to last year, while Thales had recorded at At the time, a major order from the United Arab Emirates for Rafale fighter jets.

Orders over the first nine months of the year thus stood at 12.370 billion euros, or below the level of turnover at 12.803 billion.

In the third quarter alone, order intake fell by 6% to 3.807 billion euros while a consensus provided by the company expected 4.52 billion euros.

“This appears to be largely due to the fact that the order for 18 Indonesian Rafales was not booked during the quarter,” Jefferies says.

According to JP Morgan, the loss can also be explained by a question of timing: “the order of 400 to 450 million euros of Rafale combat aircraft by Indonesia will be recorded in the fourth quarter, and not in the third as some predicted.

However, Thales reaffirmed its annual objectives, including a ratio of order intake to turnover greater than 1.

The group’s financial director declared that the decline in orders on an annual basis was also explained by the particularly strong demand for satellites in 2022. Pascal Bouchiat, however, added that civil aviation demonstrated “strong commercial dynamics” this year. .

He told reporters he had “no doubt” that Thales would record an orders-to-revenue ratio above 1 this year, adding that orders tended to increase during the fourth quarter.

FLEA CRISIS

Thales reported on Tuesday organic growth in its nine-month turnover of 7.5% in the wake of the rebound in demand for equipment for airliners and military defenses.

In the third quarter alone, turnover increased by 7.2%, to 4.138 billion euros.

In the Digital Identity and Security sector, however, the group recorded a double-digit decline in payment cards and SIM cards in the third quarter, particularly in Asia.

Pascal Bouchiat said the recent microchip supply crisis that affected the group’s digital division appeared to be over. He added, however, that supply gaps persist in aerospace.

More generally, he also said, supply chains for hardware and mechanical components remain under significant pressure in several countries, affecting satellites and radars.

Thales is closely monitoring the situation of small suppliers who were unable to invest appropriately during the COVID pandemic and are now struggling to meet demand. In some cases, the group paid advances or provided other support measures.

“We remain very vigilant,” commented Pascal Bouchiat, adding that he hopes that the situation will gradually stabilize next year.

(Reporting by Tim Hepher, written by Jean Terzian and Mariana Abreu; edited by Blandine Hénault)

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