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EADS beats full year profit target

EADS beats full year profit target

The parent company of planemaker Airbus on Tuesday reported an 89 percent gain in fourth-quarter net profit but warned of a "very challenging" year ahead.
European Aeronautics Defense and Space Co. said it expects a decline in profitability this year as it cuts aircraft prices and helps customers finance deliveries to cope with the darkening outlook for the global economy.
As demand for air travel falls and amid tight credit conditions, airlines may seek to defer or cancel orders at Airbus, which accounts for two-thirds of EADS's revenue. The planemaker's plan to get between 300 and 400 new orders this year "is challenging," its parent company said.
EADS CEO Louis Gallois said on a conference call that the company is watching airlines closely in case Airbus needs to cut production rates further. It has already reduced production of its A320 family of short and medium-range commercial passenger aircraft to 34 a month from 36.
"2009 will be a very challenging year for our industry," Gallois said.
On top of the recession, EADS is also struggling to regain control of its delayed A400M military transport jet program, which the company said could lead to a "significant charge" this year.
In September, EADS indefinitely postponed the first flight of the military jet and it is now negotiating a "new approach" with the seven European NATO countries that first ordered the plane.
The Paris and Munich-based company said that excluding the financial impact of the A400M, it expects earnings before interest and tax (EBIT) to remain "significantly positive" but fall from last year's


Updated : 2021-03-08 00:53 GMT+08:00