Airbus profit lifted by exceptionals

PARIS, France – Airbus Group said Wednesday, July 27, its net profit rose 15% in the first half of the year to 1.76 billion euros ($1.94 billion), but the gain was due to exceptional items that masked a slide in operating earnings.

The company was hit by charges of just over 1 billion euros related to its troubled A400M military cargo transporter program, while adverse currency movements and charges on its widebody A350 aircraft totaled nearly 900 million.

However these were compensated for by the sale of shares in Dassault Aviation and the creation of a rocket launcher joint venture with Safran that generated a net gain of nearly 1.9 billion euros.

One-off items produced a net gain of 172 million euros, accounting for most of the 237 million increase in net profit.

Before one-off items the company’s operating earnings fell by 11% to 1.7 billion euros.

Revenue, which is received when aircraft are delivered, was flat in the first half of the year at 28.8 billion euros.

Orders tumbled by 27% to 39 billion euros, but the company pointed to brisk sales at the Farnborough Airshow earlier this month.

“The first-half underlying financial performance reflects our well-flagged back-loaded aircraft delivery schedule this year,” said Airbus Group chief executive Tom Enders.

The company delivered 298 aircraft in the first half of the year compared to 304 in the same period in 2015.

Airbus, which now has an order book of 978 billion euros, is trying to ramp up production of its most popular aircraft models, such as the medium-haul A320 jet.

It said it expects to meet its target of delivering 650 aircraft this year. – Rappler.com