ROME — After hinting for months that he would consider selling DRS, Finmeccanica CEO Mauro Moretti said on Thursday he was taking stock of the firm's improving results and putting off all decisions until September.
Moretti first suggested last summer he could sell the US electronics unit that Finmeccanica bought in 2008. Then, in January, he told analysts that he would seek a partner to help run the unit, while selling off activity worth €200 million (US $214.6 million), euros, including DRS's Aviation and Logistics, as well as Training Communications and Network solutions units.
At the time, Moretti said DRS's volumes had halved since Finmeccanica bought the firm for $5.2 billion, citing slowing US defense spending.
There were also, he said, "Clear difficulties managing the business effectively as a true domestic player if you are not American."
After finding a partner, Moretti said, "We will look at longer term options." Analysts at the time said the partnership could be a prelude to selling. up.
But on Thursday, March 19, at a meeting with analysts to discuss Finmeccanica's 2014 results, Moretti appeared more upbeat about DRS.
"We would like to wait for the results of the second quarter," he said.
"We are registering good results, a change of the curve, a change of the trend at DRS of the last few years, and immediately after that we can analyze the situation," he said.
"We have two opportunities. If we would like to reinforce our position in the US market, maybe an industrial partner could be the best solution. Otherwise we have to change our dream and look for a financial partner for other choices," he said.
"We consider at the moment the problem of the disposal postponed. In September we will have all the elements to decide about DRS," he added.
On Wednesday,March 18, Finmeccanica reported a higher-than-forecast 23 percent rise in 2014 core profit, helped by higher sales from aerospace, defense and security units.
The company said earnings before interest, tax and amortization (EBITA) rose to €1.08 billion and that euros and said it expects EBITA this year to be of between €1.08 billion and €1.13 billion a year and revenues of between €12 billion and €12.5 billion. euros.
Email: tkington@defensenews.com
Tom Kington is the Italy correspondent for Defense News.
