🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Stocks

Airbus reaffirms jet output goals amid strong demand

Published 04/10/2024, 08:25 AM
Updated 04/10/2024, 10:51 AM
© Reuters. FILE PHOTO: The logo of Airbus is pictured outside the Airbus facility in Saint-Nazaire, France, November 7, 2023. REUTERS/Stephane Mahe/File Photo
BA
-
EADSY
-

AMSTERDAM (Reuters) -Airbus voiced confidence in airplane output forecasts on Wednesday, telling shareholders it hoped to overcome lingering supply challenges at an Amsterdam meeting held against the backdrop of a deep corporate crisis at U.S. rival Boeing (NYSE:BA).

Shares in the France-based company have risen 16% since the start of the year, while Boeing - dealing with the aftermath of a panel blowout on a 737 MAX 9 - has lost 29%.

Shareholders agreed a partial renewal to the board and backed a one-euro-per-share special dividend worth almost 800 million euros on top of an unchanged regular payout.

Airbus responded to pressure from investors to return some cash by unveiling the proposed special dividend in February, signalling confidence in its commercial-led business despite taking hefty charges at its troubled Space arm.

The world's largest planemaker is seeing orders from airlines recovering from the pandemic, helping it to build cash reserves in contrast with its rival which is in the midst of management upheaval and debts stemming from earlier crises.

Analysts said the planemaker appeared on track to meet its annual delivery target of 800 aircraft after confirming 142 first-quarter deliveries on Tuesday, as reported by Reuters.

But core single-aisle production is running below internal planning levels at around 50 a month, meaning it must accelerate to meet a target of 75 a month in 2026, industry sources said.

Airbus has said it is on the right path to meet the goal.

"We continue to operate in an environment that remains complex ... affected by geopolitical tensions and supply chain challenges," Chief Executive Guillaume Faury said.

However he reaffirmed the 75 a month goal as well as a parallel target to lift A350 output to 10 a month in 2026.

The company faces mounting cost pressures after investing in resources to secure the ramp-up, pushing it above internal cost projections earlier this year, industry sources said.

Other possible warning signs of industrial stress include an increase in the amount of time lost to injuries relative to hours worked in the civil business, bucking a more positive trend in the group. Airbus says eradicating the causes of such problems will be a focus this year.

Officials said Airbus remained committed to investing in digital technology after abandoning talks last month to buy the BDS cybersecurity and big-data business of Atos, prompting France to pledge to protect certain strategic assets.

© Reuters. FILE PHOTO: The logo of Airbus is pictured outside the Airbus facility in Saint-Nazaire, France, November 7, 2023. REUTERS/Stephane Mahe/File Photo

"We will look we will continue to look for ways to grow in cyber and cybersecurity" including through organic growth and potential acquisitions, Airbus Chairman Rene Obermann said.

He cited a decision last month to buy German IT firm INFODAS for an undisclosed sum.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.