Airbus profits take off on sale of defence electronics firm

European aircraft maker Airbus said on Thursday its profits soared 52 percent in the first quarter largely due to the sale of its defence electronics business.

Sales progressed 7.0 percent to 13 billion euros ($14.2 billion), the aeronautics giant said. For 2017, it forecast the delivery of more than 700 commercial aircraft, up from 688 in 2016.

But it warned that "challenges remain on meeting contractual capabilities, securing sufficient export orders in time, cost reduction and commercial exposure, which could be significant."

It registered six orders for commercial aircraft in the quarter, against 10 in the same period last year.

Net profits were up to 608 million from 399 million in the same three-month period last year.

It attributed the strong result mainly to the sale of its German-based Defence Electronics firm to investment company KKR in February, which generated 560 million euros.

"Our first quarter performance doesn’t offer any big surprises: we are on track for our full year EBIT and free cash flow objectives and we took a nice uptick in cash proceeds from the sale of Defence Electronics," said CEO Tom Enders.

"New order activity was low in Q1 as predicted but let’s not forget that our strong order book of over 6,700 commercial aircraft supports our ongoing production ramp-up. Programme execution remains key for all our businesses!"

source: AFP