Aerospace and defense major Airbus Group SE (EADSF.PK, EADSY.PK) reported Tuesday that its third-quarter net income increased significantly, while EBIT was up 3 percent with higher commercial aircraft revenues. Nine-month order intake dropped from last year. Further, the company confirmed its forecast for fiscal 2017.
Airbus Chief Executive Officer Tom Enders said, “The strong backlog and a healthy market environment continue to support our commercial aircraft production ramp-up plans. We confirm our outlook even though this year’s delivery schedule is extremely back-loaded, largely due to the well-known engine problems plaguing our A320neo Family.”
In its third quarter, net income attributable to equity owners of the parent surged to 348 million euros from 50 million euros last year. Earnings per share were 0.45 euro, higher than 0.06 euro last year.
Revenues for the quarter increased 2 percent to 14.24 billion euros from 13.95 billion euros in the prior year.
Revenue growth was mainly driven by a 4 percent rise in Commercial Aircraft, partly offset by 8 percent lower revenues from lower deliveries and services at Helicopters and a 7 percent drop in Defence and Space revenues.
In the nine months, order intake totaled 50.8 billion euros, down 31 percent from 73.2 billion euros last year. The order book was valued at 945 billion euros as of September 30, 2017, down 11 percent from 1.06 trillion euros at the year-end 2016.
A total of 271 net commercial aircraft orders were received, with the order backlog comprising 6,691 aircraft at the end of September, while last year’s aircraft orders were 380 units.
Looking ahead, for fiscal 2017, Airbus still expects mid-single-digit percentage growth in adjusted EBIT and adjusted earnings per share compared to 2016.
As the basis for its 2017 guidance, Airbus continues to expect the world economy and air traffic to grow in line with prevailing independent forecasts, which assume no major disruptions.
Airbus still expects to deliver more than 700 commercial aircraft which depends on engine manufacturers meeting commitments.
Further, the company said that the perimeter change in Defence and Space is expected to reduce EBIT Adjusted by around 150 million euros and adjusted earnings per share by around 14 cents.
The company noted that the industrial ramp up on the A350 continues to make good progress, with the programme well on track to meet the monthly production target rate of 10 aircraft by the end of 2018. Progress was also made on A350 recurring cost convergence.