Motor Sich to raise revenue 14% yoy in 2013

Motor Sich (MSICH UK) CEO Vyacheslav Boguslaev said he expects the company’s revenue to reach USD 820-840 mln in 2012 (vs. USD 726 mln in 2011) and sees 14% yoy growth in 2013. Management is targeting a 25% yoy increase in the company’s order book to USD 1 bln next year due to the extension of AI-222-25F engine deliveries for China’s L-15 jets.

Roman Dmytrenko: The extension of the Chinese contract indicates that Motor Sich has finally agreed to cooperate on production with its Chinese counterparty (see our news on May 3). Though the Chinese contract includes supplies of an additional 200 AI-222-25F engines in 2013-2015, bringing the company an estimated USD 0.5 bln for the period. Close cooperation is very likely to finish after that, as we see a risk of China creating its own copy of the engine in a couple of years.