Airbus maintains the course of 1,000 planes per year despite the turbulence


(Update: CFO comments on shareholder return policy, stock price)

PARIS (Agefi-Dow Jones)–The aeronautics and defense group Airbus confirmed on Friday that it wants to increase its annual production from 700 aircraft in 2022 to a thousand by the middle of the decade, despite the constraints weighing on its chain. supply.

Around 2:40 p.m., the title yielded 0.4% on a Parisian market down nearly 2%.

“We are on the path to achieving our goal” of 700 deliveries in 2022, assured Guillaume Faury, the executive director of Airbus, during an investor day, even if he recognized that there was still “a lot of work to accomplish” to achieve this.

By the end of August, the group had delivered 382 planes against 384 in the same period of 2021. The aircraft manufacturer shipped a total of 611 planes last year.

While air traffic has rebounded strongly since the start of 2022, Airbus is suffering from difficulties in the supply of spare parts and engines which are hampering the ramp-up of its production.

These difficulties led to a decline in its deliveries and its results in the second quarter, and led the group to lower its delivery target to 700 aircraft this year, instead of 720.

For Citi analysts, the delay taken by the aircraft manufacturer is not insurmountable and the share price reflects overly pessimistic expectations in terms of production. Based on the current exchange rate, the market only integrates about forty deliveries per month, “which is very far from what we think is the likely outcome”, underlined the financial intermediary in a note published Thursday.

Pass of arms with Pratt & Whitney

Airbus also reaffirmed on Friday that it wanted to reach a production of 75 A320s per month in 2025, a target considered too ambitious by some of its suppliers.

The managing director of Raytheon, maker of the Pratt & Whitney engines that power part of the new Airbus A220 and A320, estimated last week that a rate of 65 aircraft per month in 2025 was more reasonable.

These comments are “counterproductive” and “do not correspond to what we have discussed recently”, reacted Guillaume Faury on Friday. The Airbus chief executive said he recalled Greg Hayes on Thursday and confirmed with him the target of 75 planes per month. “They are not going back on this commitment, but they say it will be difficult and we know that too,” he added.

Airbus has also agreed with other suppliers on volumes for 2023 and 2024, said Guillaume Faury, who said he hoped supply chain difficulties would resolve “by mid-2023”.

The group intends to return to its pre-Covid production, i.e. around 860 aircraft per year, “during the year 2024”, said financial director Dominik Asam during the same investor day.

Dominik Asam also confirmed the financial objectives for the current year, namely adjusted operating profit (Ebit) of around 5.5 billion euros and cash flow before mergers and acquisitions and customer financing of around 3 .5 billion euros.

The official also indicated that the group would continue to increase its profits and dividends, aiming for a payout rate “at the top of the range” of 30 to 40% previously announced.

In addition, “when we have reached our objective of 10 billion euros in net cash, and if we have no imminent merger-acquisition project, we will engage in discussions with the board of directors on other forms back to shareholders,” he added.

Airbus’ net cash stood at 7.2 billion euros at June 30, compared to 7.7 billion at the end of December.

-François Schott, Agefi-Dow Jones, 01 41 27 47 92; [email protected] ed: ECH

Agefi-Dow Jones The financial newswire

Dow Jones Newswires

September 23, 2022 08:48 ET (12:48 GMT)



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