Elbit Systems Ltd. (NASDAQ:ESLT) Q3 2023 Earnings Call Transcript

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Butzi Machlis: Hey Shahar, it’s Butzi. Of course, we are — the IDS is a very important customer of us, and we support — we heavily supported forces, and we get the orders from the MOD and we expect general orders comes from MOD and [indiscernible] to 12 weeks, and certainly, we expect to get additional notice. With regard to Sayyad, I will just say that we have already several international customers to the system derivative and derivatives of these systems are being used in Europe as well as in North America. And to the best of my knowledge, we have the most comprehensive solution which is available right now in the market. And we see a lot of potential for that and this system includes radios, networks, application, training packages, and hardware and many more.

So, certainly, there’s a lot of interest for these solutions, we are world leader with that. And we have already many customers. Just a month and a half ago, we reported a nice win [indiscernible] to be the partner for the digitization after we won the radio in this country, and we expect to get additional [indiscernible].

Kobi Kagan: Your third question [indiscernible], regarding geographical distribution, when we have FMS sales, we — geographically, it’s being recorded under Israel.

Unidentified Analyst: Got you. One follow-up question. Have you seen — or what’s the most practical yet exciting thing in tangible that you can say about the interest of order of non-Israeli customer with platform solutions, which basically being deployed now in Israel. Have you seen any, I would say, inflection point in some of the solution? If yes, which of your solution experience inflection point in demand outside of Israel as a result of the [indiscernible]?

Butzi Machlis: I think it’s too early to speak about the results of the war and about better management of the world. We are not still there. We are still very much involved in supporting the process. And of course, when this war will be over, we’ll be in a better position to learn, transform, and to understand and to learn more, of course, when we will have the data we share it with our customers around the world. I can tell you that we have — our solutions and systems are heavily used by the forces that to the best of my understanding, the operators are — recognize the importance of the solutions that we are providing. And after the war, we will understand — we will well be able to — and this is related to all domains.

This is — it is related to war. It is related to munitions. It is related to optics, radars, to UAVs, to training system, EW solution and many others. And this will also cause us to accelerate development processes in the company and the solution quickly to the field. So at the end of the war, I think we will be able to sit together with our customer to understand what else needs to be done, and we will share this data with our customers.

Unidentified Analyst: Got you. And one last, if I may squeeze, the margin of your — the rush order you get currently from Israel, are they below at 1.5 or above your usual margins? I’m talking about gross margin.

Kobi Kagan: We don’t see any different level of margins in the rush orders. So it’s — so we don’t see any difference there.

Unidentified Analyst: All right. Thanks.

Butzi Machlis: Thank you, Shahar.

Operator: [Operator Instructions] There are no further questions at this time. Before I ask Mr. Machlis to go ahead with his closing statement, I would like to remind participants that a replay of this call will be available two hours after the conference ends. In the US, please call 1888-782-4291. In Israel, please call 03-925-5900. And internationally, please call 9723-925-5900. A replay of the call will be also available on the company’s website at www.elbitsystems.com. Mr. Machlis, would you like to make your concluding statement?

Butzi Machlis: I would like to thank our employees again for their hard work and dedication. To everyone on the call, thank you for joining us today and for your continued support and interest in our company. Have a good day, and good bye.

Operator: Thank you. This concludes the Elbit Systems Ltd. third quarter 2023 results conference call. Thank you for your participation. You may go ahead and disconnect.

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