CSG Fires Back With 800,000-Round Production Proof as Triple Deadline Looms

CSG posts record Q1 revenue of €1.544B, production capacity exceeds 800,000 rounds, directly refuting Hunterbrook's claims; stock surges 9% from near all-time low.

The Czechoslovak Group has delivered its sharpest rebuttal yet to the short-sellers who drove its stock to within a whisker of an all-time low. Five weeks after Hunterbrook Media alleged the defence group was merely refurbishing old munitions rather than manufacturing new ones, CSG published first-quarter figures that show its own production capacity exceeded 800,000 large-calibre rounds by the end of March. The stock jumped nearly nine percent on the day to €18.90, clawing back some ground from the May 4 trough of €15.73, though it remains more than 44 percent below the January high of €33.81.

The numbers paint a picture of an operation scaling at speed. Revenue for the first three months of 2026 reached €1.544 billion, up 13.8 percent year-on-year, driven by a 26.5 percent surge in the Defence Systems segment. Operating EBIT rose 8.7 percent to €372 million, yielding a margin of 24.1 percent — comfortably inside the company’s target range. The order backlog climbed to €17 billion, with a further €27 billion in the pipeline. CSG also settled a €275 million receivable from the sale of non-core assets during the quarter.

Yet the real payload is the production data. CSG now plans to lift its annual large-calibre ammunition capacity to roughly 850,000 rounds by the end of 2026, up from 550,000 last year. The Q1 figure of over 800,000 rounds directly contradicts Hunterbrook’s claim that the company lacks genuine manufacturing heft. Since the quarter closed, CSG has added two major contracts with European NATO customers worth around €550 million combined.

The company is also deepening its vertical integration. A 49 percent stake in Austria’s Hirtenberger Defence Systems, pending regulatory clearance, will bolster its mortar and ammunition portfolio. A new plant in Greece is already turning out 155-mm shells under a 25-year joint venture, while a facility in Slovakia dedicated to artillery propellant charges aims to cut reliance on external suppliers and reduce input costs. In parallel, a joint venture with Hungarian partner 4iG is being explored for a Slovakian site.

Political and financial deadlines now crowd the calendar. CSG’s subsidiary ZVS Holding has signed a framework contract with the Slovak defence ministry worth up to €58 billion in ammunition — a deal that would ideally be funded through the EU’s SAFE programme, which offers loans at one percent over 40 years. But with a single-country exemption expiring at the end of May, Slovakia must find at least one other EU partner to access the cheap credit. Romania has already declined; Croatia is still deliberating. CSG stresses that the framework contains no firm orders and that implementation does not hinge on any single funding source. Meanwhile, an expected €90 billion EU credit facility for Ukraine could accelerate order flow further down the line.

On the operational side, the fundamentals are solid. Net debt stands at €2.228 billion, a modest 1.3 times operating EBITDA. The Ukraine conflict still accounts for around 20 percent of group revenue, though CSG continues to diversify its end-customer base. Management has reaffirmed full-year guidance of €7.4–7.6 billion in sales, an EBIT margin of 24–25 percent, and capital expenditure of roughly 8.5 percent of revenue.

The ratings agencies have taken note. Moody’s recently upgraded CSG to Baa3, lifting it into investment grade, while Fitch confirmed its BBB- rating. That should lower future financing costs and open the door to institutional investors with minimum-rating mandates. For the stock, the near-term direction hinges on three events: the credibility of the Q1 numbers, the Austrian regulator’s decision on Hirtenberger, and the EU funding puzzle. If all three break CSG’s way, the recovery rally may have the ammunition it needs.