Airbus Is on Track to Deliver Fiscal Year Outlook After Good 2Q -- Earnings Review

By Olivia Bugault

Airbus SE (AIR.FR) reported second-quarter results on Wednesday morning. Here's what we watched:

SALES FORECAST: Revenue was up 23% to EUR18.32 billion due to higher jetliner deliveries, ahead of a EUR17.63 billion consensus estimate provided by FactSet.

NET INCOME FORECAST: Net profit surged to 1.16 billion euros ($1.29 billion) from EUR213 million in the quarter a year earlier, slightly ahead of a EUR1.11 billion consensus estimate provided by FactSet.

WHAT WE WATCHED:

-STRONG 2Q, AS EXPECTED: Airbus' net profit rose more than fivefold during the quarter, driven by an increase in deliveries. Airbus is on track to become the largest plane maker by deliveries this year for the first time since 2011. It overtook Boeing in the first half, with 389 planes shipped compared with the U.S. company's 239. Its top-selling A320 family planes accounted for a majority of the deliveries. The European plane maker stuck to its 2019 guidance, which includes the delivery of 880 to 890 commercial aircraft this year.

-FCF IN FOCUS: Airbus suffered about EUR3.98 billion in cash outflow before mergers and acquisitions and customer financing in the first six months. However, it still expects to generate around EUR4 billion in free cash flow by year end as Airbus typically generates most of its FCF during the last quarter as it recovers from delayed plane handovers.

-PRODUCTION DELAYS: Airbus warned that deliveries would remain challenging for the rest of the year. The company has been struggling with delays due partly to issues at its Hamburg plant, which slowed production during the first half of the year.

Write to Olivia Bugault at [e-mail]

(END) Dow Jones Newswires

July 31, 2019 08:46 ET (12:46 GMT)

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