By Marta Frackowiak
(Reuters) -Norway’s Kongsberg said on Thursday its order intake and profits soared in the first quarter, driven by demand for missiles and air defence systems at a time when European nations are stepping up their defence spending.
Kongsberg saw its quarterly order intake rise 63% from a year earlier to 20.74 billion Norwegian crowns ($2 billion), half of which was for the defence and aerospace unit.
Its shares rose 6% in early trading and were among top performers on Europe’s benchmark STOXX 600 index as of 0809 GMT.
“We see already the impact of the larger defence spendings in Europe,” Kongsberg’s CEO Geir Håøy said during a conference call with analysts and journalists, though he added it would take time for the company to see a major impact from that.
European countries are bolstering their defence budgets and reaffirming their support for Ukraine, concerned that the U.S. under President Donald Trump may no longer be as invested in Europe’s security.
Håøy also said Kongsberg was already well established in Europe, which is its most important market.
The company’s exports to the United States consist mostly of defence products for the U.S. armed forces, which fall under the Defense Federal Acquisition Regulation Supplement (DFARS) regulations and as such are subject to duty free imports, finance chief Mette Toft Bjørgen said in the call.
The defence and aerospace division, Kongsberg’s second biggest making up around 40% of its revenue, last year secured deliveries of critical equipment to Ukraine while also contributing to the completion of F-16 fighter jets and training of Ukrainian soldiers on its systems.
The unit’s order intake more than doubled over 2024 amid surging demand for defence equipment.
“In recent years, the demand for missile and air defence systems has contributed to a significant increase in the order backlog and has been an important driver for our capacity expansions,” Håøy said in the earnings statement.
Kongsberg’s operating earnings before depreciation and amortisation (EBITDA) grew 81% to 3.29 billion crowns in the first quarter, also boosted by sales growth in its maritime division which generated around half of its revenue last year.
($1 = 10.3497 Norwegian crowns)
(Reporting by Marta Frąckowiak in Gdansk; Editing by Milla Nissi-Prussak)
