Following the announcement of Q1 2018 order intake and sales in line with expectations, Thales has confirmed its objectives for the full year.

Q1 order intake jumped 34%, to €3,032m, thanks to large orders from Australia (OneSKY project to modernise civil and military air traffic management infrastructures), Qatar (12 additional Rafale combat aircraft) and Poland (railway signalling system renovation).

Sales for Q1 2018 stood at €3,412m, up 4.1% on a reported basis, and up 7.2% at constant scope and currency.

For the full year, accelerated momentum in the defence businesses is expected to offset the slowdown of the telecom satellite market. 2018 order intake is expected to be around €15.5bn.

In spite of a more moderate growth in the aerospace segment, sales should see an organic growth of 4-5% compared to 2017 sales restated for the application of the IFRS 15 standard (€15.2bn).

R&D investments will increase significantly, particularly in digital technologies. Self-funded R&D expenses are expected to increase by approximately 10% compared to 2017.

The growth in sales, combined with the impact of the Ambition 10 strategy on product competitiveness and differentiation, should result in an EBIT of between €1,620 and €1,660m in 2018 (based on February 2018 scope and exchange rates) — an increase of 19-22% compared to 2017.

Thales therefore expects to exceed its two mid-term objectives: average organic sales growth in the 2016-2018 period should be over 5%, and the 2018 EBIT margin should be above the top end of the range set in April 2014 (9.5% to 10% in 2017/2018).