Airbus SE has raised its earnings and aircraft delivery guidance, and said it will build a new freighter, in a sign of growing optimism that demand is recovering from the coronavirus pandemic.
AndThe European aircraft maker expects to deliver 600 planes this year, helping raise adjusted operating profit to 4 billion euros ($4.7 billion), double the previous target, the company said in a statement Thursday.
Airbus will offer a freighter version of the modern A350 wide-body aircraft, as it seeks to undermine the competitive advantage of the American company Boeing in this sector.
The latest figures confirm a strong recovery in aviation after Boeing reported its first profit in nearly two years. Airbus was more cautious earlier, targeting at least 566 deliveries this year as the airline industry recovers from its worst-ever crisis.
The revised target notes that carriers are firmly in recovery mode after the manufacturer spent months working to stave off order cancellations.
“We continue to work with suppliers and customers to beat the pandemic, but we are starting to see a better environment,” said CEO Guillaume Faury.
Airbus shares rose 4.9% and traded 3.3% higher at 119.4 euros at 9:12 am in Paris. The stock has gained 32% this year.
China and the United States, with their huge domestic air markets, led the return of travel, with expectations improving further this week with the United Kingdom announcing that it would allow fully vaccinated visitors from America and the European Union to enter the country without the need for quarantine.
Airbus also raised its adjusted free cash flow target. It is now expected to reach 2 billion euros this year, up from previous expectations of a breakeven.
The Toulouse, France-based aircraft maker posted adjusted first-half earnings before interest and taxes of 2.7 billion euros, beating analyst estimates, with revenue jumping nearly a third from last year. It delivered 297 planes, an increase of 101 from the first six months of 2020, when the shutdowns affected production.
Faury said the freighter version of the A350 is expected to enter service in 2025, after the project was approved by the council. He said the aircraft will be based mostly on the A350-1000, its largest version, and will have a payload capacity of more than 90 metric tons.