(Reuters) - Supplier Howmet Aerospace Inc on Tuesday offered a conservative outlook for narrowbody jet production at top planemakers Boeing (NYSE:BA) Co and Airbus SE (OTC:EADSY).
Shares of the company, one of the main suppliers of aerospace castings, slipped about 2% before bell.
"While industry demand is expected to be robust, Howmet Aerospace relies on aircraft and engine builds by the major OEMs, and the Company is taking a conservative view of 2023 until we see consistent build rate increases," Howmet said.
The company said its 2023 financial forecasts assume a 737 MAX production of 30 per month and Airbus A320 rates of 53 to 54 per month.
Boeing said last month it had stabilized 737 production at 31 per month. Some analysts expect production levels to rise later this year.
Airbus, meanwhile, is tempering the pace of planned production increases and expects to reach a planned level of 65 single-aisle jets a month in late 2024 and an ultimate target of 75 a month in 2026, Reuters reported last month. It is set to report full-year results this week.
Boeing and Airbus have struggled to raise production rates for the lucrative single-aisle jets due to a fractured supply chain and labor shortages at suppliers, although aerospace executives say such pressures are gradually easing.
Howmet forecast its full-year earnings per share between $1.53 and $1.67 per share, below analysts' average estimate of $1.73, as per Refinitiv data.
Its fourth quarter profit rose to $111 million, or 26 cents per share, from $77 million, 18 cents per share, a year earlier.
Quarterly revenue rose nearly 18% to $1.51 billion.