CSG’s Net Profit Surges 95% as Order Backlog Hits Record €17bn, Paving Path for Ammunition Expansion

Czech defence group CSG reports Q1 net profit up 95% to €299M, net debt cut 26%, and record €44B order pipeline, rebounding from short-seller attack.

The Czechoslovak Group (CSG) delivered a thunderous rebuttal to its detractors on Wednesday, posting first-quarter net profit that nearly doubled from a year earlier while slashing debt by more than a quarter. Shares in the defence contractor rocketed 11.6% — their biggest one-day gain since the Amsterdam IPO in January — as the market seized on the combination of surging earnings and a record order book.

Net income from continuing operations jumped to €299 million in the three months to March 31, up from €153 million in the same period last year. Revenue rose 13.8% to €1.544 billion, with operating EBIT climbing 8.7% to €372 million — producing a margin of 24.1%, comfortably within the company’s full-year target of 24–25%. The figures, though unaudited, provided the clearest signal yet that the business is firing on all cylinders despite a bruising attack from short-seller Hunterbrook Media that had wiped a quarter off the stock shortly after listing.

Far more compelling than the profit line, however, was the order backlog. CSG’s firm orders grew 15.1% from the end of 2025 to €17 billion as of March 31, with an additional €27 billion in advanced negotiations. Combined, the company now points to a total market opportunity of €44 billion — a measure of revenue visibility that management argues is the real story behind the numbers. “This is a project-driven business, and visibility is everything,” analysts at a London brokerage noted.

The record order intake was driven almost entirely by the Defence Systems segment, where revenue surged 26.5% to €1.25 billion and margins hit 28.5%, underpinned by relentless global demand for military land systems and large-calibre munitions. Yet the picture was less rosy in the Ammo+ division, which houses the Kinetic Group assets acquired at the end of 2024. There, revenue slumped 20.5% to €291 million, and operating profit collapsed to just €13 million. Management blamed a temporary downturn in the US civilian market, but added that demand had already rebounded sharply by the end of the quarter.

CSG also used the earnings release to sweep aside the lingering doubts cast by Hunterbrook, which had questioned the veracity of production data and the quality of corporate governance. The company reiterated that all IPO disclosures were accurate, and noted that €275 million in receivables from related parties were fully collected during the first quarter — removing one of the short-seller’s central accusations. The stock, at €18.70, remains far below its 52-week high of €33.81, but the 14% gain over the past seven days has partially restored confidence.

Debt reduction added muscle to the recovery story. Net debt fell to €2.228 billion from €3.004 billion at the end of last year, as CSG channelled €750 million of the primary IPO proceeds into repayment. Cash and equivalents swelled to €2.287 billion from €1.505 billion, while gross debt held steady at roughly €4.5 billion. The net leverage ratio stood at 1.3 times trailing twelve-month EBITDA, with a year-end target of below that threshold.

On the exhibition floor, CSG showed it is not resting on financials alone. At the IDEB 2026 defence fair in Bratislava, the group unveiled the CFL-120 “Karpat” medium tank, developed in partnership with Turkey’s FNSS Savunma Sistemleri. The platform combines main battle tank firepower with significantly lower weight, and serial production is slated for Slovakia. Meanwhile, production capacity for large-calibre ammunition is on track to reach 850,000 units per year by the end of 2026, up from 550,000 in 2025, supported by new manufacturing lines in Slovakia and in-house propellant production.

CSG confirmed its full-year guidance for revenue of €7.4 billion to €7.6 billion and an operating margin of 24–25%, with a stronger second half expected as new 5.56mm ammunition capacity comes online in North America and Southeast Asia. The next major checkpoint is the half-year report on August 7. Whether the current rally represents a lasting turnaround or a technical bounce will depend on the company’s ability to convert that €44 billion opportunity into cash flow and earnings.