x Abu Dhabi, UAEWednesday 26 July 2017

Airbus parent EADS sees further profit growth after buoyant 2012

Airbus parent EADS predicted higher profit this year on the heels of stronger than expected 2012 earnings and a clampdown on costs.

Airbus parent EADS predicted higher profit this year on the heels of stronger than expected 2012 earnings and a clampdown on costs, with the development of its A350 jet remaining the biggest wild card in its bid to match rival Boeing.

The world's second-largest aerospace company delivered stronger than expected 2012 earnings and increased its dividend, while stabilising hard-to-predict cashflows, but took charges for defence restructuring and bad helicopter deals.

Unveiling earnings for the first time since failing to carry off an attempted merger with UK arms contractor BAE Systems, chief executive Tom Enders pledged to run EADS as a "normal company" after years of political interference.

The BAE setback paved the way for a reorganisation of the European aircraft manufacturer's complex public and private shareholdings. France and Germany will continue to own stakes, but a higher proportion of shares will be held by ordinary investors.

Airbus has also bounced back a year after the high-profile discovery of wing cracks on its A380 superjumbo, with the spotlight falling instead on Boeing, which is wrestling with battery problems on its 787 Dreamliner.

EADS said it had largely absorbed the costs of repairing and preventing cracks on the world's largest airliner and any further potential one-off costs should be limited mainly to the A350 project, which it continued to describe as "challenging".

For now, it is sticking to plans to fly Europe's answer to the 787 this summer, having rolled it out of the assembly line in Toulouse, France, on Tuesday for outdoor tests.

EADS operating profit rose 68 per cent to €3bn in 2012 for an operating margin of 5.3 per cent on revenue up 15 per cent to €56.5bn, it said on Wednesday.

Net profit also grew 19 per cent to €1.2bn.

For 2013 it targeted €3.5bn in operating profit and earnings per share of €2.5, up from €2.24, before a planned share buyback linked to the shake-up of shareholdings.

 

* Reuters