(Adds comments from CEO interview)
By Tova Cohen
TEL AVIV, May 26 (Reuters) - Israeli defence electronics firm Elbit Systems reported higher quarterly profit on Tuesday and said its business has not been substantially impacted by the coronavirus outbreak.
The maker of drones, pilot helmet displays and cyber security systems said it earned $1.63 per diluted share excluding one-time items in the first quarter, up from $1.54 a year earlier. Revenue rose to $1.07 billion from $1.02 billion.
Its shares were 3.1 % higher in early trading.
Though business during the quarter was not materially impacted by the pandemic, “subsequently, some of our businesses have begun to experience certain disruptions due to government directed safety measures, travel restrictions and supply chain delays,” Elbit said.
“To date, the financial impact to us of these disruptions has not been material.”
Still, Elbit has taken precautionary measures, including reducing its dividend in the quarter to 35 cents a share from 44 cents a year earlier. Chief Executive Bezhalel Machlis said this was temporary.
“There is uncertainty ... so we are taking all the relevant measures to be sure we are ready,” he told Reuters. “We collected a lot of cash from different sources and inventory is a bit higher to make sure we can continue to deliver to our customers.”
The company also cut costs, including temporarily reducing management salaries and furloughing about 300 of its 17,000 workers, although some have already returned.
In the past 18 months Elbit bought weapons maker IMI from Israel’s government for $500 million and the night vision business of L3Harris Technologies for $350 million. These acquisitions and growth in North America boosted first quarter results.
Elbit’s order backlog climbed to a record $10.79 billion at the end of the quarter from $9.66 billion a year earlier.
Elbit will record a pretax gain of $40 million in the second quarter from the sale of part of its shares in cybersecurity firm Cyberbit and from a real estate deal. (Reporting by Tova Cohen; Editing by Kirsten Donovan)