European Aeronautics Defense and Space Company (EADS) has reported a huge rise in its Q3 profit amid strong demand for its commercial aircraft. EADS seems set to continue flying high on record orders in 2013.
Between July and September, EADS posted profits of 436 million euros ($587 million), which was about 45 more than in the same quarter a year ago, the European aerospace giant announced Thursday.
The rise came on the back of 11 percent higher revenues which jumped to 13.6 billion euros in the period. The third-quarter result boosted EADS 2013 net profit to 1.2 billion euros by the end of September, up 36 percent over the year.
“We achieved a good improvement in revenues and profitability over the first nine months thanks largely to our civil aircraft business,” said EADS Chief Executive Tom Enders.
Enders also noted, however, that the group had significant challenges ahead of it, particularly with respect to cash flow and to the A350 program, which had entered the next critical phase.
Huge development costs
EADS subsidiary Airbus is planning to deliver its first A350 long-range wide body airplanes to customers at the end of 2014. But the plane's huge development costs had contributed to a negative EADS cash flow of minus 1.5 billion euros in the third quarter, the firm disclosed.
Nevertheless, the money seems well spent as Airbus announced an increase in its prospected 2013 aircraft deliveries from about 600 to 620 planes. Moreover, EADS said it was on track to receive about 1,200 orders in 2013 as a whole, which was well above the target of 1,000 it had set itself for this year.
EADS also reported good results in its helicopter, space technology and military businesses. While revenues were flat in the Cassidian military division due to cuts in European defense spending, they were slightly higher in the Astrium space subsidiary and at Eurocopter.
EADS, which will adopt the name Airbus for its corporate identity next year, expects its 2013 operating profit before one-offs to reach 3.5 billion euros this year, up from 3 billion euros in 2012.
uhe/ipj (AP, Reuters, dpa)