| EADS has first loss in five years on Airbus delays
PARIS - Airbus parent EADS reported annual losses of $684.7 million today, a year marred by the botched roll out of both military and commercial aircraft.
European Aeronautic Defence & Space Co. returned to profit in the fourth quarter and said it would boost earnings further this year, though the guidance the company issued was below analyst expectations.
"I am not content with the 2007 figures," said CEO Louis Gallois said in a statement. "In 2007, we have prepared the future and we have cleaned up part of the past."
The company reported a fourth-quarter net profit of $397.3 million after a $1.2 billion loss in the October-December period the year before.
The company recorded fewer charges in the quarter on the long-delayed A380 superjumbo, which was finally delivered to Singapore Airlines in October.
Airbus, based in Toulouse, France, posted a fourth-quarter operating loss of $313 million after a loss of $2.6 billion in 2006.
For the full year, EADS lost $684.7 million, compared with a profit of $152 million in 2006.
"I think that the worst is behind them," said Harald Liberge-Dondoux, an analyst with CM-CIC Securities in Paris.
"We are not out of the tunnel. There will still be a few little pieces of bad news, but not of the same scale."
For 2008, EADS forecast an EBIT of $2.76 billion "reflecting higher comfort in its improving ability to drive profitability."
Sales in 2008 are expected to top $55 billion, EADS said. In 2007, revenue was virtually flat at $60 billion, compared with $60.5 billion a year before.
Delivery of the company's A380 superjumbo was set back for two nearly two years, cutting into profits. In November, Airbus announced a delay to its A400M military transport jet that could cost as much as $2 billion in penalties and other charges.
The slumping dollar has also sapped profits.
EADS scored a major victory last month when, along with its U.S. partner Northrop Grumman, it won a $35 billion Pentagon contract to build refueling tankers for the Air Force, beating out Boeing for one of the biggest Pentagon contracts in decades.
EADS has sold tankers to Australia, Saudi Arabia, the United Arab Emirates and is in talks with Britain. CFO Hans Peter Ring said a consortium led by EADS could complete a deal to supply midair refueling tankers to Britain in the coming days or weeks.
EADS said earnings before interest and tax -- a closely watched indicator -- fell to $79.8 million in 2007 from $612.5 million in 2006.
EADS said it expects Airbus to deliver about 470 planes in 2008 compared with 453 in 2007. Deliveries will peak in 2011-2012, the company said.
Associated Press  |