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EADS Sees Recovery in Commercial Jet Market as Global Airlines Emerge from Recession

Strategic Insights

— 2 min read

Airbus co-chief Philippe Camus expects benefits of global air traffic recovery in 2005, with passenger traffic growing 7 per cent this year. The Asia-Pacific region is expected to lead the recovery, allowing airlines to repair their balance sheets. Airbus delivered 305 aircraft in 2004, taking 254 net orders, and is expected to remain flat in 2005. However, there will be an increase in orders and deliveries in 2005 reflecting the improvement in traffic. The civil jet market recovery is in line with industry forecasts, and the space business is expected to return to health.

Key Takeaways:

  • European Aeronautic Defence and Space company (EADS) expects a recovery in the large commercial jet market next year as the global airline industry emerges from the worst recession in its history.
  • Airbus co-chief Philippe Camus expects passenger traffic to grow 7 per cent this year, led by the Asia-Pacific region, allowing many airlines to start repairing their balance sheets.
  • Airbus delivered 305 aircraft in 2004, pushing it ahead of Boeing for the first time, and took 254 net orders. These numbers are expected to remain flat in 2005.
  • The recovery in the civil jet market is in line with industry forecasts, and EADS anticipates an increase in orders and deliveries in 2005 reflecting the improvement in traffic.
  • Rainer Hertrich, EADS co-chief executive, said the company is now at a turning point indicating stronger growth over the medium term.
  • EADS upgraded its operating profit forecast for 2004 by Euros 100m to Euros 1.8bn (Dollars 2.2bn), lifted purely by an accounting change.
  • EADS reported a full-year net profit of Euros 152m, compared with a loss of Euros 299m in 2002.
  • Revenues rose from Euros 29.9bn to Euros 30.1bn, with operating profits exceeding forecasts due to strong growth in defence businesses and better-than-expected performance at Airbus.
  • EADS plans to increase its dividend to 40 cents from 30 cents.

Statistics:

  • Passenger traffic worldwide is expected to grow 7 per cent in 2004.
  • Airbus delivered 305 aircraft in 2004.
  • Airbus took 254 net orders in 2004.
  • EADS upgraded its operating profit forecast for 2004 by Euros 100m to Euros 1.8bn (Dollars 2.2bn).
  • EADS reported a full-year net profit of Euros 152m in 2004.
  • Revenues rose from Euros 29.9bn to Euros 30.1bn in 2004.
  • EADS plans to increase its dividend to 40 cents from 30 cents.

Sources:

  • European Aeronautic Defence and Space company (EADS) press release
  • Bloomberg
  • Reuters

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