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Targets 5-7% compound annual sales growth in 2024-2028

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Targets 13-14% operating profit margin in 2028

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CEO puts focus on higher-margin cyber products

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Confirms "exploratory" discussions on space consolidation

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(Updates throughout with shares and news conference)

By Tim Hepher

PARIS, Nov 14 (Reuters) - Defence and technology firm

Thales unveiled new four-year targets on Thursday,

predicting more than 25 billion euros of revenues by 2028 as

global defence spending rises and the company reaps a decade of

cyber investments.

Europe's largest defence technology supplier, which has also

quadrupled its cybersecurity revenues through acquisitions in

recent years, said it aimed for 5% to 7% average compound sales

growth between 2024 and 2028.

Shares in the France-based company rose over 2% in early

trading as analysts said the forecasts were broadly as expected.

CEO Patrice Caine told reporters the world was looking at a

higher defence spending likely to last 10 years, while cyber

attacks and increasing demands for privacy would propel

cybersecurity, where Thales aims to be a top-five global player.

"It is evident that the world has entered a cycle of higher

investments in defence," Caine told a news conference.

He said it was too early to judge the impact of U.S.

elections on Thales' broad portfolio from defence to civil

aircraft. European nations are widely expected to boost defence

spending while some civil markets face potential disruption from

hawkish signals on sanctions from president-elect Donald Trump.

"If Europe wants to take a bigger role in (defence), it

is more of an advantage than a risk for Thales," Caine said. "It

is unlikely the (security) risks are going to be lower

tomorrow".

Thales targets an operating profit margin of 13% to 14% in

2028, up from 11.6% in 2023 and the 11.7% to 11.8% it expects

this year.

The figures were set out ahead of the first full-scale

Thales investor day since 2019, a period that has seen margins

resume growth after dipping during the COVID pandemic.

Its military and civil products range from sub-hunting

sonars to biometric identity systems for banks, and from

satellites to seat-back entertainment systems for airlines.

Under Caine, who next month marks 10 years as CEO, Thales

has also shifted away from areas like rail signalling to forge a

leading role in cybersecurity after buying chipmaker Gemalto in

2019 and U.S. cybersecurity company Imperva in 2023.

SPACE RECOVERY

Caine set out a strategy to focus on customers prepared

to pay a premium for specialist high-value products like banks

and critical sectors such as energy, with higher margins than

services.

He said Thales wanted to focus on platforms designed to

protect data, applications and access for its often sovereign

customers.

Caine acknowledged that Thales, born from a French state

arms firm privatised in the late 1990s, operated on a different

scale from U.S. giants despite strong growth during his tenure.

He said the company's space business was still in "recovery

mode" with pressure coming especially from Elon Musk's rapidly

growing Starlink constellation in low Earth orbit.

Thales predicted average annual sales growth of just 2%

for space by 2028, compared to 6% to 7% for defence and cyber

units.

Confirming discussions over consolidation between satellite

makers for the first time, Caine said they were at "an

exploratory stage". Industry sources have said Thales and its

partner Leonardo are looking at a tie-up of some space

activities with Airbus.

He declined comment on reports that the French state was

linking up with Thales, in which it owns 27%, to buy sensitive

assets of cyber firm Atos, following months of speculation about

the owner of supercomputers that simulate nuclear bomb tests.

($1 = 0.9485 euros)

(Reporting by Tim Hepher;

Editing by Sudip Kar-Gupta and Ros Russell)