Associated Press | Airbus parent company EADS says net profit down 41 percent in 1st half, keeps full-year goals
July 29, 2011 § Leave a comment
By The Associated Press
Published: 29 July 2011
PARIS — Airbus parent company EADS NV said Friday its first-half earnings fell from a year earlier as the impact of the weakening U.S. dollar offset higher commercial and military jet sales and record orders for its new A320neo fuel-saving jet.
EADS says in a statement it made a net profit of €109 million ($155 million) in the first half compared to €185 million a year earlier. The earnings included financial charges to account for a drop in the value of the European plane maker’s commercial backlog, which fell €28 billion because of the weakening U.S. currency.
Despite this EADS said it is on track to achieve its targeted earnings for the full year, with higher sales and stable profitability compared to a year earlier.
The company has booked record sales for its A320neo, a revamped version of Airbus’ A320 single-aisle workhorse jet that it claims will save airlines 15 percent on their fuel bill. Airlines struggling to eke out savings showed a large demand for the jet at the Paris Air Show in June, and the jet’s success was underlined last week when U.S. carrier American Airlines announced an order for 260 of the Airbus planes alongside an order for 200 of rival Boeing Co’s jets.
The deal was a major coup for Europe’s Airbus, which will break Boeing’s exclusive grip on American’s fleet. Airbus hadn’t won an order from American since the 1980s.
The A320neo is equipped with new more fuel-efficient engines designed by Pratt & Whitney and CFM, a joint venture between General Electric and Safran. Airbus is ramping up production of the A320 at plants in Toulouse, France, Hamburg, Germany and Tianjin, China to meet the strong demand.
The large order from American Airlines added to the 1,000 A320neos already on order by other airlines and has led some industry analysts to speculate Airbus would have to ramp up capacity even further, perhaps by building an assembly plant in the U.S.
EADS CEO Louis Gallois said there is “no concrete project” to assemble planes in the US.
“Everything could be considered but for time being any element on that is speculation,” Gallois said in a conference call with reporters.
In the first half Airbus took in 640 net new orders and delivered 258 aircraft. The company targets gross orders of more than 1,000 this year, and to deliver between 520 and 530 aircraft.