Zinger Key Points
- Elbit Systems anticipates $52 million in Q4 non-cash expenses, primarily from inventory write-offs and contract asset losses.
- Approximately $34 million of the expenses are related to an uncollectible balance of contract assets under the discontinued project.
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Elbit Systems Ltd. ESLT shares are trading lower after it disclosed that it expects to record non-cash expenses of approximately $52 million in the fourth quarter of 2023.
The expenses are related to the write-off of inventory due to the closing of an underperforming subsidiary with limited synergies and contract assets related to a discontinued project managed under the subsidiary.
The company says that around $34 million of the expenses are related to an uncollectible balance of contract assets under the discontinued project.
Apart from this, Elbit Systems identified about $18 million of the expenses related to the restructuring and discontinuing the subsidiary’s activities.
The company plans to release the fourth quarter and full year 2023 financial results on Tuesday, March 26, 2024.
Last month, the company secured a contract worth around $300 million to provide weapon, reconnaissance, driving, and situational awareness systems for roughly 230 armored vehicles to a European client.
Price Action: ESLT shares are down 1.63% at $217.01 premarket on the last check Tuesday.
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