Airbus Earnings Stalled by Lack of A320 Engines

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European aircraft maker Airbus reported first-quarter results Friday morning, and the report was dominated by the company’s continuing problem: getting enough engines to deliver new A320neos to customers. The company’s revenues for the first quarter of the year totaled €10.1 billion (about $12.2 billion), down from €11.4 billion last year.

Airbus reported net new orders for 45 commercial jets, a big improvement from just six in the year-ago quarter. The orders include one for 20 A380 superjumbo passenger jets from Emirates. The company delivered 121 commercial jets in the quarter, compared to 136 deliveries in the year-ago quarter.

Adjusted consolidated EBIT in the first quarter totaled €14 million, compared to a net loss of €19 million last year. Adjusted EBIT for the commercial jet business showed a net loss of €41 million, which reflects the company’s inability to deliver A320neos.

Engine-maker Pratt & Whitney, a division of United Technologies Corp. (NYSE: UTX), has begun shipping new geared turbofan engines for the A320neo, and CFM International, a joint venture between General Electric Co. (NYSE: GE) and Safran, is still working on catching up on deliveries for the Leap-1A engine Airbus also uses on the A320neo.

Airbus remains committed to its delivery projections of around 800 commercial jets for the year, but that depends largely on P&W’s and CFM’s ability to deliver engines. Airbus expects adjusted EBIT of €5.2 billion this year.

There are currently 60 A320neo gliders parked at the Airbus facility in Toulouse and Hamburg waiting for engines to be delivered. The company shipped just 35 of a planned 90 in the first quarter. If Airbus is going to meet its projected annual delivery total of 400, those engines had better begin arriving in reasonable numbers.

Shares of Airbus traded up about 1% in Paris Tuesday at €96.49, in a 52-week range of €68.42 to €99.97. The 12-month price target on the stock is €106.47.

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