Haifa-based Rafael Advanced Defense Systems has reported a significant surge in sales and orders for the second quarter of 2023.
The Israeli defense giant saw sales climb to 3.9 billion shekels ($1.07 billion), representing a 25% increase from the same period last year.
The company’s orders received experienced an even more dramatic rise, jumping 65% to 6.4 billion shekels ($1.76 billion) in Q2, compared to 3.9 billion shekels ($1.07 billion) in the corresponding quarter of the previous year. This robust performance has led to an all-time high in Rafael’s order backlog, which now stands at an impressive 59 billion shekels (16.2 billion).
Yoav Har-Even, CEO of Rafael, shared insights into the company’s growth strategy: “Since the beginning of the year, we’ve hired more than 1,100 employees. A third of our activity is involved in development, we invest enormous amounts of energy in determining the future.”
One of the key developments highlighted by Har-Even is the Magen Or laser-based air-defense system.
“Magen Or is expected to enter operational service next year,” he said. “Magen Or is just one of the developments that is progressing at a nice pace, and it has global technological breakthroughs.”
While the proportion of the firm’s sales to Israel slightly decreased from 59% to 54% between Q1 and Q2, there was a notable increase in sales to countries in the Western Hemisphere. The Americas market share jumped from 3% in Q1 to 8% in Q2, bolstered by Argentina’s reported interest in purchasing Spike LR2 anti-tank missiles.
“We are active in 41 countries with Spike,” Har-Even explained. “There is a club of system users, where knowledge and experience are passed from one to another.”
The Spike series of fire-and-forget anti-tank guided missiles range from the shoulder-launched TACT (a Hebrew acronym for Short Range Personal Missile) model to the long-range NLOS (Non-Line Of Sight) Tamuz, capable of being deployed from land, air or sea platforms.
The company’s financial results for the first half of 2023 are equally impressive. Rafael reported a net profit of 364 million shekels ($100.1 million), marking a 132 million shekel ($36.3 million) year-on-year increase from three months earlier. Total sales for the half-year period reached 7.8 billion shekels ($2.15 billion), a 28% year-on-year increase.
The ongoing Iron Swords War has increased demand for Rafael’s products, along with those of other Israeli defense companies. However, this heightened exposure has also created challenges, including instances of reverse engineering by enemies.
Addressing these concerns, Har-Even said, “In routine times, it’s easier to protect against reverse engineering because the equipment is in protected places and doesn’t allow the enemy to reach it. During wartime, there are means and capabilities that are exposed. We try to run fast so that the information [exposed] will be much less relevant.”
