Rheinmetall (RHM) Investor presentation summary

Strategic positioning and market drivers

• Positioned as an all-domain defense system house with high backward integration and a new five-segment structure from 2026: Weapon and Ammunition, Vehicle Systems, Air Defence, Digital Systems, and Naval Systems.

• Significant order backlog growth driven by increased defense spending, especially in Germany and NATO countries, with a backlog exceeding €100bn and sales expected to reach ~€50bn by 2030.

• Major market drivers include rising geopolitical tensions, increased NATO spending targets, and a focus on closing capability gaps in air/missile defense, artillery, drones, and digitalization.

• Expansion through joint ventures, M&A, and partnerships, notably in Italy, the USA, and Ukraine, to access new markets and technologies.

• Sustainability strategy targets carbon neutrality by 2035 (Scope 1 & 2), enhanced supply chain transparency, and strong ESG compliance.

Segment performance and growth initiatives

• Vehicle Systems: Sales potential of €13-15bn by 2030, driven by large programs (Boxer, Lynx, XM30) and a shift to mass production, with Germany as a key growth market.

• Weapon and Ammunition: Sales potential of €14-16bn by 2030, with ramp-up in artillery, tank, and missile production, and new JV for deep strike capabilities.

• Air Defence: Sales potential of €3-4bn by 2030, with strong demand for gun-based and C-UAS systems, and significant capacity expansion across Europe.

• Digital Systems: Sales potential of €8-10bn by 2030, led by digitalization of armed forces, drone production, and F-35 center fuselage manufacturing.

• Naval Systems: Sales potential of ~€5bn by 2030, following the acquisition of Naval Vessels Lürssen, covering 100% of surface vessel demand and expanding international presence.

Financial performance and outlook

• FY2025 sales reached €9.9bn (+28.8% YoY), EBIT €1.68bn, and operating margin 18.5%, with strong growth in all segments.

• Dividend per share increased to €11.5 for FY2025, reflecting a 26% CAGR over the last decade.

• Capex over €8bn planned for the next five years, with a focus on capacity expansion, supply chain resilience, and selective M&A.

• Low leverage (net debt/EBITDA 1.12), equity ratio >30%, and strong cash conversion rate (>50% target by 2030).

• 2030 guidance: sales ~€50bn, operating margin >20%, and continued focus on organic and inorganic growth.