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Airbus Group 9-month Profit Rises

Aerospace and defense major Airbus Group SE (EADSF.PK,EADSY.PK) reported that its consolidated net income for the nine-month of 2018 rose to 1.453 billion euros from 1.398 billion euros last year. Earnings per share grew to 1.88 euros from 1.81 euros last year. The latest result included a negative impact from the foreign exchange revaluation of financial instruments partly offset by the positive revaluation of certain equity investments.

Consolidated EBIT amounted to 2.683 billion euros, up from 1.673 billion euros last year.

Consolidated revenues increased to 40.4 billion euros from 38.0 billion euros last year, mainly driven by Airbus and including the perimeter changes. At Airbus, a total of 503 commercial aircraft were delivered, comprising 8 A220s, 395 A320 Family, 31 A330s, 61 A350 XWBs and 8 A380s. The company delivered about 454 commercial aircraft in 2017.

On a reported basis, Helicopters' revenues reflected the perimeter change from the sale of Vector Aerospace inlate 2017. Revenues at Airbus Defence and Space reflected a stable core business and the perimeter change mainly related to the divestment of Defence Electronics in February 2017 and Airbus DS Communications, Inc. in March 2018.

With regard to full-year deliveries, the A320neo ramp-up is ongoing but the level of disruption resulting from the late availability of engines in the first half of 2018 as well as some internal industrial challenges make the full-year 2018 target a greater stretch. A lot remains to be done before the end of the year to fulfill commitments, Airbus Group said.

The A330neo delivery schedule has been adjusted to reflect the engine partner's latest 2018 outlook. Furthermore, Airbus said it is actively working to resolve certain commercial challenges on the A330ceo and A380 programmes that are targeted for completion by the year-end.

As the basis for its 2018 guidance, the company expects the world economy and air traffic to grow in line with prevailing independent forecasts, which assume no major disruptions.

Airbus targets to deliver around 800 commercial aircraft in 2018, now including around 18 A220 aircraft and the updated commercial aircraft delivery schedule.

Before M&A, the company maintains expected EBIT Adjusted of approximately 5 billion euros in 2018. This includes a lower expected reduction in EBIT Adjusted from the A220 than estimated in the first-half of 2018.

Airbus expects Free Cash Flow before M&A and Customer Financing to be lower than the 2017 level of 2.95 billion euros. This also reflects an expected reduction of about EUR -0.3 billion from the A220.

In 2018, the company expects the net cash impact of the A220 integration to be largely covered by the funding arrangement as laid out in the terms of the C Series Aircraft Limited Partnership, meaning limited cash dilution.

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