Czech group CSG's revenue, profits soar on defence spending amid Ukraine war

PRAGUE, April 10 (Reuters) - Revenue at Czech defence and industrial manufacturer Czechoslovak Group (CSG) rose by 71% last year while earnings before interest, tax and amortisation (EBITDA) more than doubled due to rising demand for military equipment, the company said on Wednesday.

The maker of heavy military equipment and large-caliber ammunition - in high demand due to the war in Ukraine - said increasing defence budgets provided potential for revenue growth in the coming years.

Revenue rose to 1.73 billion euros ($1.88 billion) in 2023. EBITDA jumped by 130% to 439 million, the company said, while net profit climbed by 49% to 210 million euros.

CSG, owned by Czech businessman Michal Strnad, 31, has been investing into raising its ammunition production at its plants in Slovakia and Spain, and has also played an important role in western efforts to procure and supply military material to Ukraine.

The company is also in the process of a $1.91 billion all-cash acquisition of the Sporting Products division of U.S.-based Vista Outdoor, since renamed as Kinetic Group, which includes its guns and ammunition production business.

"The continuing Russian aggression against Ukraine resulted in a significant increase in defence spending in most European countries, especially in Eastern and Northern Europe," CSG said.

"This is accompanied by greater pressure to expand production capacity and - given the high consumption of mainly large caliber ammunition and ground equipment - the need to replenish more rapidly the stocks of military equipment and materiel in the arsenals of NATO member states."

($1 = 0.9214 euros) (Reporting by Jan Lopatka Editing by Jason Hovet)