(Reuters) -Norwegian engineering group Kongsberg is building up production capacity to meet growing orders for its defence products, especially missiles, as European nations bulk up their military spending.
Kongsberg, which has customers in defence, aerospace, maritime, energy and fishing industries, booked orders worth 18.18 billion Norwegian crowns ($1.80 billion) in the second quarter, 5% more than last year, it said on Wednesday.
The Defence & Aerospace business made up 54% of those, as CEO Geir Håøy said the company was experiencing record-high market activity in the sector.
“There is a significant need to strengthen defence capabilities, and we continue to expand capacity in line with growing demand,” Håøy said in the earnings statement.
Kongsberg is building up capacity in Australia, and later this year will start building production facilities in the United States. It also has opportunities to increase defence production in Norway, Håøy said in a call with analysts and media.
The company is also continuously working with its supply chain, which Håøy said was as important as building its own capacity.
Many European nations have pledged to significantly increase defence budgets in response to Russia’s invasion of Ukraine and as U.S. President Donald Trump’s administration has threatened to scale back military support for the region.
Thanks to that, Kongsberg had seen its orders and profits grow also in the first quarter of 2025.
Its second-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 28% to 2.33 billion Norwegian crowns. Five analysts polled by LSEG were expecting 2.25 billion on average.
Its revenue of 13.9 billion crowns was 1.7% below consensus, according to LSEG’s I/B/E/S data.
Kongsberg’s shares were 7.4% lower in Oslo at 0744 GMT.
($1 = 10.0974 Norwegian crowns)
(Reporting by Marta Frąckowiak in Gdansk; editing by Milla Nissi-Prussak)
