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Airbus March quarter profit jumps 93% to €439 million

LiveMint logoLiveMint 13-05-2014 AFP

Paris: Airbus Group, formerly European Aeronautic Defence And Space (EADS), reported on Tuesday a near doubling of quarterly net profit, a rise in sales driven by helicopters, but a fall in new orders after an exceptional performance last year.

Net profit for the quarter rose by 93% to €439 million ($604.5 million).

The price of shares in the group rose by 4.91 % to €51.92 in early trading in Paris. The overall French market as measured by the Cotation Assistée en Continu 40(CAC 40) index was up 0.20%.

The value of orders taken fell by more than half to €21.1 billion from €49.5 billion.

This reflected orders taken for 103 aircraft on a net basis, after allowing for cancellations.

That was far short of the figure of 410 in the first quarter of 2013 which was an exceptional year for aircraft manufacturers, notably Airbus and its main US rival Boeing Co., as airlines rushed to renew their fleets after the financial crisis and in readiness for a forecast boom in air travel, mainly in emerging economies led by countries in Asia.

Airbus has already said that it will not be able to match the 2013 figures for orders taken.

However, Airbus held to its forecast that orders taken this year would exceed the number of aircraft delivered, and that its operating margin would be 7-8% in 2015.

In the first three months of the year the group achieved an operating margin of 5.5%.

Sales revenue by the group, which builds mainly Airbus airliners but also has wide interests in the aerospace sector from making helicopters to satellite equipment, fell by 5% in the quarter from the equivalent figure last year to €12.6 billion.

Meanwhile, Airbus Helicopters, formerly Eurocopter, increased its number of orders taken by half.

Airbus Helicopters also increased the number of aircraft delivered to 74 from 58, and so raised sales by 14 %.

The Airbus Defence and Space division, grouping the two activities formerly known as Astrium and Cassidian, held new orders at about the previous level.

The group said that the overall performance meant that earnings per share had doubled from €28 cents to 56 cents.

Chief executive Tom Enders said that the group was holding to its forecasts but still had much to do by the end of the year, with the emphasis being on applying restructuring programmes.

The company is due to put its new A350 airliner into service by the end of the year. This aircraft is a long-haul plane with a fuselage made of composite materials.

The group changed its name to Airbus Group at the beginning of this year in a major refocusing of activities after a failed attempt at merger with British group BAE Systems Plc.

It is now restructuring its defence and space activities to face increased international competition at a time of cuts in defence budgets by governments in the West.

At stock brokers Aurel BGC in Paris, analysts said that Airbus had published solid results with sales exceeding expectations. They noted that the group had fallen behind Boeing in recent months but remained confident.

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