PARIS (Reuters) - France's Thales
Europe's largest defence electronics firm said annual operating earnings rose 8 percent to 1.0 billion euros (825.11 million pounds), lifting its core profit margin by more than half a percentage point, on sales which remained flat at 14.2 billion euros.
Order intake, which lagged behind sales in 2013, rose 7 percent to 14.2 billion euros.
For 2014, Thales predicted a 5-7 percent rise in operating profits coupled with double-digit growth in orders from emerging markets, while forecasting another year of stable sales.
"Order intake in emerging markets should continue to increase, with a double-digit growth expected for 2014, allowing to offset the expected fall of order intake from mature countries, particularly in defence markets," Thales said in a statement.
Net profits slipped 2 percent to 573 million euros. Thales said it would recommend a 27 percent hike in its dividend to 1.12 euros per share.
Analysts were on average expecting a 2013 operating profit of 984 million euros, net profit of 638 million euros and sales of 14.3 billion, according to Thomson Reuters I/B/E/S data.
Western defence companies are expanding a drive for exports to offset weaker domestic defence spending. Thales also benefits from a strong upswing in commercial aerospace demand.
Order intake in the largest division, Defence and Security rose 14 percent as sales there dipped 1 percent.
Thales said 10 of the 19 major contracts it won across the group in 2013 - deals worth more than 100 million euros each - came from emerging markets compared with just two in 2012.
New defence contracts included a Saudi frigates upgrade and air defence radars in the UAE.
Thales shares closed earlier down 0.6 percent at 46.92 euros.
(Reporting by Tim Hepher, Cyril Altmeyer; Editing by Andrew Callus)