Shares of Airbus SE (EADSF.PK,EADSY.PK) were gaining around 5 percent in the morning trading in Paris after the European aerospace company reported Thursday strong profit growth in its fiscal 2018 on higher commercial aircraft deliveries. Looking ahead for fiscal 2019, the company expects about 15 percent increase in adjusted EBIT, a key earnings measure.
Further, the company announced that it plans to cease deliveries of the A380 in 2021 based on UAE-based Emirates’ decision to reduce its orders, as well as the lack of order backlog with other airlines.
Airbus further said it will start discussions with its social partners in the next few weeks regarding the 3,000 to 3,500 positions potentially impacted over the next three years. However, the ongoing A320 ramp-up and the new widebody order from Emirates Airline will offer a significant number of internal mobility opportunities.
Airbus Chief Executive Officer Tom Enders said, “As a result of this decision we have no substantial A380 backlog and hence no basis to sustain production, despite all our sales efforts with other airlines in recent years. This leads to the end of A380 deliveries in 2021. The consequences of this decision are largely embedded in our 2018 full year results.”
Emirates trimmed its A380 orderbook to 123 aircraft from 162 following a review of its operations, and in light of developments in aircraft and engine technologies. Emirates will take delivery of 14 further A380s over the next two years.
Further, Emirates signed new orders for Airbus’ newest generation, flexible widebody aircraft. The company has ordered 40 A330-900 and 30 A350-900 aircraft.
As the basis for its 2019 guidance, Airbus said it expects the world economy and air traffic to grow in line with prevailing independent forecasts, which assume no major disruptions.
In its fiscal 2018, consolidated net income climbed to 3.05 billion euros from last year’s 2.36 billion euros. Earnings per share were 3.94 euros, up from 3.05 euros a year ago.
Consolidated EBIT amounted to 5.05 billion euros, higher than 2.67 billion euros a year ago. Consolidated EBIT adjusted totaled 5.83 billion euros, compared to 3.19 billion euros a year ago.
Consolidated revenues increased to 63.7 billion euros from 59.0 billion euros last year, mainly reflecting the record commercial aircraft deliveries. At Airbus, a total of 800 commercial aircraft were delivered, up from 718 aircraft a year ago.
Consolidated order intake in 2018 totaled 55.5 billion euros with the consolidated order book valued at 460 billion euros as on December 31, 2018 under IFRS 15.
Further, the Board of Directors will propose to the Annual General Meeting the payment of a 2018 dividend of 1.65 euros per share on 17 April 2019, up 10 percent from 1.50 euros per share last year.
In Paris, Airbus shares were trading at 109.08 euros, up 4.50 percent.