Israeli defence electronics firm Elbit Systems Q3 profit drops

Credit: REUTERS/Baz Ratner

JERUSALEM, Nov 29 (Reuters) - Israeli defence electronics firm Elbit Systems ESLT.TA, ESLT.O on Tuesday reported a drop in third-quarter profit, hit by higher expenses from stock price-linked compensation plans for employees.

The company earned $1.40 per diluted share excluding one-time items in the quarter compared to $2.33 per share the previous year. Revenue slipped to $1.348 billion from $1.363 billion.

The company's board declared a dividend of 50 cents per share for the third quarter to be paid on Jan. 9.

Elbit, whose Tel Aviv-listed shares are up 18.5% this year, has warned during the year of higher expenses due to the compensation plans that are linked to the company's stock price.

"Elevated geopolitical tensions and growing defence budgets have created multiple opportunities and we are increasing investment in business development to realize the potential from these trends," said CEO Bezhalel Machlis.

He said the company believes that supply chain and labour inflation pressures "will gradually subside from the second half of 2023."

Elbit said its backlog of orders reached $14.7 billion at the end of September, up from $14.1 billion in the previous quarter. About 75% of that comes from orders outside Israel, and some 40% is due in 2022 and 2023.

(Reporting by Ari Rabinovitch, Editing by Louise Heavens)

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