Production Proof and a Rising Floor: CSG’s First Earnings as a Public Company Hit the Right Notes

Moody’s had just hoisted Czechoslovak Group (CSG) into investment-grade territory with a Baa3 rating, and Fitch had reaffirmed its own BBB- stamp. Those upgrades, combined with the release of the company’s first quarterly report since its Amsterdam IPO in January, offered investors a clear counter-narrative to the short-seller assault that had hammered the stock. The question was whether the numbers would back it up.

They did. Revenue jumped 13.8% year-on-year to €1.544 billion in the first quarter of 2026, led by the Defence Systems segment, which expanded at an eye-watering 26.5% clip. Operating EBIT came in at €372 million, yielding a margin of 24.1% — stable compared with the final quarter of 2025 and comfortably inside the full-year target range of 24% to 25%. Management reiterated its 2026 guidance of €7.4 billion to €7.6 billion in sales, a confidence boost given the market’s earlier jitters.

The backlog, always the key metric in defense, swelled to €17 billion, driven primarily by Land Systems, while the negotiation pipeline stood at €27 billion. Net debt stood at €2.228 billion as of March 31, equating to 1.3 times operating EBITDA and sitting below the company’s own target corridor of 1.5x. Those leverage numbers, coupled with the rating upgrades, could lower future financing costs and open the door to institutional investors bound by minimum credit thresholds.

Should investors sell immediately? Or is it worth buying CSG?

But the quarterly disclosure was about more than clean math. The short-seller attack from Hunterbrook Media had accused CSG of not being a genuine manufacturer. The Q1 report served as a rebuttal, detailing capacity expansion across several fronts. The acquisition of a 49% stake in Austria’s Hirtenberger Defence Systems (HDS) — pending regulatory clearance — would deepen the company’s mortar and ammunition portfolio. In Greece, 155mm production is already running inside a 25-year joint venture. In Poland, two cooperation agreements have been signed with Polska Grupa Zbrojeniowa, and the first local acquisition, DOMAR MS, is nearing completion. By end-2026, CSG aims to produce roughly 850,000 rounds of large-caliber ammunition, up from 550,000 last year.

The regulatory decision on HDS is one of three critical events on the near-term calendar. Another is the status of a massive framework agreement signed by subsidiary ZVS Holding with the Slovak defence ministry: a munitions deal worth up to €58 billion, ideally financed through the EU’s SAFE program, which offers one-percent loans with 40-year maturities. The catch is that Slovakia needs at least one other EU partner to tap those favorable terms. Romania has already passed, Croatia remains undecided, and the individual-country exception expires at the end of May 2026. CSG has stressed the agreement is a framework without firm orders and does not rely solely on any single funding pool.

On the product side, CSG showcased its latest creation at the IDEB 2026 exhibition in Bratislava just before the earnings release: the CFL-120 Karpat, a medium-weight battle tank developed with Turkey’s FNSS. With a curb weight of up to 34 tonnes, a top speed of 70 km/h and a 450-kilometer range, the vehicle features a turret supplied by Leonardo. Production will take place in Slovakia, progressively incorporating local suppliers.

The stock market, which had punished CSG mercilessly after the IPO, is beginning to thaw. The shares hit an all-time low of €15.73 in early May — more than 50% below the issue price. Since then, a recovery has taken hold. The stock changed hands at €18.57 on the day of the Q1 release, a daily gain of nearly 7%, and was up 16% over the trailing seven days. Still, at roughly half the 52-week high of €33.81, the discount to operational reality remains steep. High annualized volatility — 75% — reflects lingering nervousness, but the first quarterly report has given investors hard data to weigh against bearish narratives. The next concrete checkpoint is the half-year results on August 7.

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