Airbus profits up but problems persist with A400M, A350

AP News
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Posted: Jul 27, 2016 4:27 AM

PARIS (AP) — Airbus Group suffered 1.4 billion euros in losses linked to its troubled A400M military transporter and A350 passenger jet in the first half of the year, though profits rose thanks to asset sales and a satellite launch merger.

The Toulouse, France-based company on Wednesday reported profit of €1.76 billion euros ($1.94 billion), up from 1.52 billion in the first half of 2015. In the second quarter, Airbus finalized its sale of a stake in Dassault Aviation and the creation of Airbus Safran Launchers joint venture.

First-half sales were steady at 28.8 billion euros, compared with 28.9 billion last year. Overall orders were down despite a spate of deals announced at the recent Farnborough Air Show.

The company said it has worked out a temporary fix for the A400M after the discovery of gearbox problems, but took a 1.03-billion-euro hit in the second quarter and warned it could face further "significant" financial losses on the plane. Airbus said it remains a challenging problem but insisted it's an "exceptional aircraft."

Airbus also suffered a 385-million-euro penalty on the A350 wide-body, amid delays in production of cabin equipment.

Airbus maintained its forecast for stable financial results and orders over the year, hoping that the second half of the year will provide a big boost in production to make up for troubles in the first half.

It said it could not yet estimate the costs to Airbus Helicopters from an April accident in Norway.