Motor Sich targets USD 800 mln sales in 2012

Motor Sich (MSICH UK) secured 95% of its targeted 2012 order book of USD 800 mln, an undisclosed company representative said on Friday (via Interfax). The company expects to completely book its orders for the year by mid-February. Most of the contracts have 3-5 year terms.

Roman Dmytrenko: We estimate Motor Sich’s three largest contracts with Russia, China and India, which were announced and signed in 2011, will contribute USD 460 mln to sales this year (55% of the 2012 order book). Demand for helicopter engines looks stable as Russian Helicopters (the company’s main consumer) alone said it ordered for 1,000 helicopters over the next five years. At the same time, the company’s 2012 order book is 20% less than last year’s USD 1 bln target, which CEO Vyacheslav Boguslayev announced last summer. We relate Boguslayev’s optimistic goal for 2011 to a Chinese contract that could have been significantly increased if Motor Sich agreed to sell its AI-222-25F engine production technology to China.