Airbus Targets 720 Plane Deliveries on Resurgent Air Travel Demand -- Update

By Mauro Orru

Airbus SE expects to deliver more commercial aircraft this year than in 2022 and is planning to boost production rates of its wide-body aircraft as it seeks to cash in on resurgent demand for air travel after years of restrictions and border closures.

The European plane maker said Thursday that it aims to deliver roughly 720 planes to customers this year. The company delivered 661 aircraft in 2022, below the 720 target it had originally set out due to supply-chain snags.

"The company had to adjust its operations accordingly, which led to lower commercial aircraft deliveries than originally planned. We are adapting our production to match supply," Chief Executive Guillaume Faury said.

The company had plans to lift narrow-body production to 75 aircraft a month by the middle of the decade, but it is now targeting a monthly rate of 65 by the end of 2024 and 75 in 2026. For its A330, production reached around three a month at the end of 2022 and Airbus is planning for four a month in 2024. Production of its bigger A350 model should reach nine a month at the end of 2025 from around six currently.

Airbus had slashed production of its wide-body planes early in the pandemic, when travel restrictions and border closures brought international traffic to a near standstill. Now, airlines are scrambling for planes to expand capacity to meet surging demand for international air travel.

Earlier this week, Air India Ltd. agreed to purchase 210 A320 narrow-body jets and 40 of Airbus's largest airliner in production, the A350 wide-body. The Indian carrier is also buying 220 planes from rival Boeing Co.

Airbus posted revenue of 20.64 billion euros ($22.06 billion) for the fourth quarter of 2022, up from EUR16.99 billion the previous year.

Adjusted earnings before interest and taxes--a key profitability metric--climbed to EUR2.15 billion from EUR1.50 billion for the quarter.

Quarterly reported net profit increased to EUR1.68 billion from EUR1.58 billion, bringing profit for the year to EUR4.25 billion, up 1%.

Airbus was expected to report revenue of EUR20.44 billion, adjusted earnings of EUR1.95 billion and profit of EUR1.34 billion for the fourth quarter, according to a company-provided consensus that gathered estimates from 23 analysts.

The company said it will propose a EUR1.80 per share dividend for 2022, above the EUR1.50 a share it paid for the previous year.

For 2023, Airbus expects adjusted earnings of around EUR6 billion. Free cash flow before mergers and acquisitions and customer financing--another closely-watched metric by analysts and investors--should come in at around EUR3 billion.

Airbus on Wednesday tapped Thomas Toepfer from German chemicals company Covestro AG to succeed Dominik Asam as chief financial officer. Mr. Asam is moving to German business-software maker SAP SE as CFO.

"I am looking forward to working with him on the Airbus executive committee as we continue to ramp-up production and secure our long-term ambitions in a complex operating environment," Mr. Faury said.

Write to Mauro Orru at [e-mail]; @MauroOrru94

(END) Dow Jones Newswires

February 16, 2023 02:33 ET (07:33 GMT)

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