Elbit Systems (Nasdaq:ESLT) reported on Wednesday a 57% plunge in profits to $4.8 million for the second quarter of 2002, or 12 cents per fully diluted share. Excluding a nonrecurring pretax charge of $9.8 million on its subsidiary El-Op's deal with the Ministry of Industry and Trade, Elbit Systems would have netted $12.6 million, or 32 cents per fully diluted share. In the parallel quarter of 2001 Elbit Systems netted $11.2 million. During the second quarter Elbit Systems wrote off about $6.3 million pretax for possible losses on a project performed by its subsidiary, Cyclone, for the German company Fairchild-Dornier, which entered insolvency proceedings in July. Sales grew by 14% to $193.2 million, and the company's backlog of orders sprouted to $1.65 billion, of which 66% are to be performed during the second half of 2002, and the rest in 2003. Elbit Systems also declared a dividend of 8 cents per share for the second quarter of 2002, to be paid on September 10, 2002. The record date of the dividend is August 28, 2002. Regarding the Cyclone affair, Elbit Systems president and CEO Joseph Ackerman told TheMarker that the company had warned in previous quarters of fears that Dornier would not complete the project, and had taken steps accordingly. "A company has to take risks throughout its lifetime, and has to assure it won't affect its results. Altogether, excluding the payment to the chief scientist (of the Ministry of Industry and Trade - ED), we recorded growth in profits, despite the writeoff. As for the future, we do not believe we'll have to write off any more on that project." On the company's results for the rest of the year, Ackerman said that sales have usually been higher in the second half. "We expect our activity to continue to grow, and that consolidated sales of Elbit Systems for 2002 will exceed $800 million. We feel comfortable with the analysts' forecasts."