EADS posts euro12 mln net loss in 1st quarter

AP News
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Posted: May 13, 2011 3:48 AM
EADS posts euro12 mln net loss in 1st quarter

Airbus parent company EADS NV Friday blamed an accounting change for a first quarter loss but said it was on track to hit its annual sales and delivery targets.

Toulouse, France based EADS reported a net loss of euro12 million ($17 million) in the first quarter compared to a profit of euro103 million a year earlier.

In a statement, the European aerospace company said a "negative accounting revaluation" of its U.S. dollar and British pound cash assets following the euro's slide between December 2010 and March, 2011 caused its earnings to slip into the red for the quarter.

But EADS said it still expects to deliver between 520 and 530 commercial aircraft this year and to report full year revenues above last year's euro46 billion. The company also still maintains its target for operating profit of around euro1.3 billion, which is in line with last year.

The maker of the Airbus 380 superjumbo jet said it's considering lifting production of its single-aisle aircraft beyond the already targeted 40 per month that it is aiming to achieve by the first quarter of 2012. The rebounding global economy is driving strong growth in passenger traffic, especially in Asia. EADS said it expects to take a decision on the ramp-up shortly.

Airbus' revamped version of its veteran single-aisle A320 has seen strong demand, EADS said, with commitments from airlines of more than 330 aircraft just four months after the program's launch.

Airbus says the A320neo has aerodynamically improved wingtip extensions and fuel-efficient engines which will deliver up to 15 percent in fuel savings. It foresees a potential market for about 4,000 A320neo aircraft.

EADS sales grew 10 percent in the first quarter to euro9.9 billion. Airbus' commercial jet making division saw sales grow 12 percent while order intake slumped in the quarter, but Chief Financial Officer Hans-Peter Ring told reporters in a conference call that the company is optimistic that this will be reversed at next month's Paris Air Show.

Airbus delivered 119 commercial aircraft in the first quarter, including four A380s. It took in 69 gross orders during the period, including 10 for the A380.

EADS warned that its long-troubled widebody A350XWB program "remains challenging," but said it still aims to put it into service by the second half of 2013.

The aircraft is designed to compete with Boeing Co.'s even more troubled 787 program. Airlines hoping to save on fuel bills are eagerly awaiting both the 787 and the A350. The new jets are designed to be more energy-efficient than aircraft flying today thanks to a greater use of composite carbon materials.