 reported a €2.3 billion hit to 2016 profits, due to costs relating to the manufacturing of a A400M military plane.){kind=link}
Airbus (EPA:AIR) reported a €2.3 billion hit to 2016 profits, due to costs relating to the manufacturing of a A400M military plane.
Adjusted operating income fell 4 per cent to €3.96 billion while revenue rose 3 per cent to €66.58 billion. Analysts had anticipated a 7.3 per cent fall in full-year operating earnings prior to unforeseen costs, with a marginal increase in sales of 0.7 per cent to €64.92 billion.
Furthermore, demand for air-carriers has been steadily falling for the year. Orders during the year were €134 billion, a slight decrease from the €159 billion for 2015. In total, Airbus carried out orders for 731 airliners during the year, compared to 1,080 in 2015, alongside a record production of 688 jets.
Chief executive Tom Enders commented: “We’ve delivered on the commitments we gave a year ago.”
He added: “We achieved our guidance and objectives, with one exception, the A400M, where we had to take another significant charge totalling 2.2bn euros (£1.85bn) in 2016.”
Regarding economic outlook for the year ahead, Mr Enders commented:
“Our commercial performance in helicopters was good despite a difficult market environment and we continued to strengthen and reshape the defence and space portfolio. We are taking additional steps to increase efficiency through the integration project, while investments in digital transformation will further improve our competitiveness.”
“De-risking the programme and strengthening programme execution are our top priorities for this aircraft in 2017,”
The development of the state of the art Airbus A400M military aircraft has faced a series of setbacks since its inception. The aircraft manufacturer nonetheless conceded that the military plane “remains a concern”, with persistent problems relating to its engines.
The company has headquarters in Leiden, Netherlands and operates across three different business divisions. These include AirBus, AirBus Defence and Space and AirBus Helicopters.
Shares in Airbus are currently down 0.76 percent as of 12.50PM (GMT).