By Robert Wall
LONDON-- Airbus Group NV on Thursday reported a rise in
first-quarter earnings bolstered by the sale of a stake in French
combat jet maker Dassault Aviation SA, as it boosted the prospect
for increasing capital returns.
Net income for the period was EUR792 million ($880 million)
compared with EUR439 million a year earlier, the Toulouse-based
plane maker said in a news release.
The company's earnings in the period were lifted by a EUR697
million net gain from the sale of a 17.5% stake in Dassault
Aviation, it said.
"We had a good start into 2015, with a solid operational
performance and improved cash generation, further supported by
asset sales," Chief Executive Tom Enders said.
Sales declined 4% to EUR12.1 billion, the world's second-largest
maker of commercial jetliners said. Airbus delivered 134 jets in
the first three months of the year compared with 141 in the
year-prior period. Sales should rebound with deliveries of
commercial jetliners weighted toward the second half as Airbus
targets more plane shipments this year than last.
The European plane maker's closely watched earnings before
interest and taxes excluding some one-time items retreated 7% to
EUR651 million.
Airbus last year announced plans to unload some defense assets
and its stake in Dassault Aviation inherited at the time the
Franco-German aerospace company was created. Airbus, which began
reducing its stake in Dassault last year, still owns around
23%.
The Dassault Aviation transaction also lifted free cash flow to
EUR452 million after a EUR2.1 billion outflow in the year-ago
period.
"We will review capital allocation toward the end of the year,"
Mr. Enders said. Airbus next month will seek shareholder approval
to buy back an extra 10% of its stock in addition to the regular
approval for a similar amount.
Chief Financial Officer Harald Wilhelm added that Airbus was in
discussions with multiple parties over defense asset sales, which
have progressed slowly. "I am very comfortable that we will see
execution of a good part of the divestments in 2015," he said.
Airbus also may unload the PFW Aerospace unit it acquired in
2011 when the supplier ran into financial difficulties. More
Dassault Aviation shares could also be sold in the last quarter of
this year and continue into 2016, Mr. Wilhelm told reporters on a
call.
Airbus has promised investors it will try to improve cash
generation and on Thursday confirmed its target of reaching
break-even on that measure excluding mergers and acquisitions.
Stripping out the Dassault Aviation gains, Airbus would have had a
EUR1.1 billion cash outflow in the first quarter.
Mr. Wilhelm also said Airbus was making good progress on
building the A350 jetliner, its newest plane. The company still
plans to deliver around 15 of the jets this year and production
costs are coming down in line with expectations, he said
Earnings at the key commercial jetliner unit rose 8% to EUR569
million before one-time items.
Airbus's helicopter division reported a 10% fall in earnings as
widely expected because of the ramp up in less-profitable
government rotorcraft. The company said a cost-reduction plan
limited the decline. The defense and space unit's earnings rose
EUR5 million to EUR90 million.
CEO Mr. Enders said the company remains on track to meet
full-year targets. That includes meeting a long-promised commitment
to start delivering A380 superjumbos from this year that no longer
lose money.
Write to Robert Wall at robert.wall@wsj.com
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