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Business

EADS profits jump 76 percent in second quarter

©

Text by NEWS WIRES

Latest update : 2009-07-28

European aerospace company EADS on Tuesday posted a net profit of 208 million euros for the second quarter, a jump of 76 percent, despite costs linked to delays of its A400M plane.

AFP - European aerospace giant EADS on Tuesday reported a 76 percent jump in net profit for the second quarter to 208 million euros (297 million dollars) despite costs linked to delays of its A400M military transporter.

EADS, the parent company of Airbus, said its second quarter operating profit was up 69 percent to 656 million euros but for the six months to June period was down 23 percent at 888 million euros.

It said the six months result reflected a charge of 191 million euros taken to cover delays on the A400M project. Total provisions for the aircraft add up to 2.3 billion euros.

"Substantial (further) charges could be taken against results in coming (quarters) depending on how the (A400M) programme advances and the outcome of negotiations" on its future with the project partners, EADS said in a statement.

Last week, the seven project partners -- Britain, France, Germany, Spain, Turkey, Belgium and Luxembourg -- agreed to renegotiate their contracts to buy the aircraft by year-end.

The future of the plane, which was to replace aging military transports in several European air forces, has been in doubt after its service date was pushed back from 2009 to 2013 amid technical problems.

French and German officials said on Friday they would extend a deadline for agreeing a new contract for the 20-billion-euro (28-billion-dollar) project until the end of the year.

EADS said its second half operating profit before exceptional items should be positive, if lower than in the first six months of the year, reflecting higher research and development costs plus unfavourable exchange rates.

Costs on the Airbus A380 superjumbo, with 14 deliveries expected this year, "are still higher than expected," EADS said.

Revenue for the six months to June inched up two percent to 20.1 billion euros, with 254 aircraft delivered, it added.

Orders were down sharply, falling 66 percent to 17.1 billion euros.

EADS said its order book had been hurt by the global financial crisis and slump but noted a recent slight improvement in trends, reiterating its "challenging" forecast for 300 aircraft orders this year.

Date created : 2009-07-28

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