Airbus is clearing the books for its new CEO
Outgoing chief says company is on ‘solid growth trajectory’
TOULOUSE: Airbus SE chief executive officer Tom Enders scrapped the company’s totemic but unprofitable A380 jet and booked more
€1.1bil than (US$1.2bil) in charges to leave a clean slate for his successor.
In addition to scrapping the flagship superjumbo, Enders, who stands down in April, announced extra costs for restructuring the A400M military transport programme and revealed the loss of a major order for its newest wide-body jet.
The shares rose, as the disclosures about aircraft projects that have dogged Airbus for years will help prepare the ground for incoming chief Guillaume Faury.
That will ease a worry list that still includes responding to the impact of Brexit on UK wing plants and dealing with fallout from a bribery probe into the use of middlemen to secure sales.
In his final results statement, Enders, 60, predicted a 15% gain in earnings this year and said he was leaving behind a company that’s on a “solid growth trajectory.”
Defense and helicopter arms that have struggled for sales are also “in good shape” for Faury and his team to take over, he said.
The shares advanced as much as 5.4% yesterday, the most in more than a month.
€109.74
Airbus was up 5.1% to at 9:03am in Paris, taking gains for the year to about 30%. In addition to terminating the A380 superjumbo
€463mil, at a cost of Airbus booked a
€436mil charge of after reaching an agreement with government customers on revamping the A400M programme. It also expensed €123mil €81mil
for compliance issues and in unspecified costs.
Adding to the landslide of revelations yes- terday was news that Abu Dhabi-based Etihad Airways will cut an order for the latest A350 wide-bodies by 42 planes.
The carrier’s Persian Gulf neighbour Emirates is picking up 30 of the type as it slashes its A380 backlog, triggering the end of that programme.
Airbus, based in Toulouse, France, posted
€5.8bil an adjusted profit of in 2018 on sales
€64bil, €1.65 of and raised its dividend to per share. In addition to the predicted earnings jump in 2019, the company said it expected €4bil
in free cashflow.
Enders is kitchen-sinking costs from problem programmes as he prepares to leave after this year’s annual shareholder meeting. The strategy may be wise given investor impatience about the pace of progress, Jefferies International analyst Sandy Morris said in a note.
The 2019 outlook is above consensus and made Airbus the “favourite in waiting” among European capital goods stocks, he said.