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UPDATE 1-Israel's Elbit Systems sees 2021 growth as order backlog spikes

(Adds details, CFO comments)

JERUSALEM, March 24 (Reuters) - Israeli defence electronics firm Elbit Systems said a jump in its order backlog should fuel further growth in 2021, after posting lower quarterly earnings hurt partly by a stronger shekel.

Elbit’s order backlog rose to $11 billion in 2020 from $10 billion in 2019, it said on Wednesday, with two-thirds of orders from outside Israel.

“That definitely gives us a good feeling about the potential growth in revenues. I would say mid-single-digit growth is not out of the question,” Chief Financial Officer Joseph Gaspar told Reuters, saying its defence business was not harmed much by the COVID-19 pandemic.

Gaspar added that along with cost-cutting steps at the company, “we believe that the growth in the top line will be reflected in the bottom line”.

Israel’s largest defence contractor, which makes drones, pilot helmet displays and cyber security systems, last year earned $7.20 per diluted share excluding one-time items, up from $6.79 in 2019.

Boosted by sales of airborne and land systems, revenue rose to $4.66 billion from $4.51 billion.

For the October to December period, Elbit said it earned $2.38 per diluted share, down from $2.47 a year earlier. Revenue rose to $1.38 billion from $1.32 billion.

It had been forecast to earn $1.93 a share on revenue of $1.33 billion, according to I/B/E/S data from Refinitiv.

Gaspar said Elbit’s planned $380 million acquisition of Florida-based Sparton Corp should close in the coming weeks, giving Elbit a foothold in the naval sector.

Overall defence spending by European and Asian governments is rising, while being flat to slightly higher in the United States, he said.

Since December, Elbit has received contracts worth more than $1 billion to supply defence equipment to Switzerland, the Netherlands, Romania, the British Navy, and a number of unnamed Asia-Pacific countries.

Elbit declared a dividend of 44 cents per share for the fourth quarter, unchanged from the third quarter. Gaspar said it was likely that a dividend payout of some 30% of net profit would continue. (Reporting by Steven Scheer; Editing by Edmund Blair and Jan Harvey)

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