European aviation tops the leader board as Airbus announces a half-billion euro charge for delays to its military transport plane but posts a market-pleasing set of results, while IAG upgrades its profit outlook. Hayley Platt reports.
Earnings at Airbus took to the skies in 2014, rising 54 percent before one-off items. The news boosted shares more than 6 percent, the equivalent of 2.5 billion euros or roughly the price of six A380 superjumbos. That despite a 551 million euro charge for delays on its A400M military transporter. The charges topped expectations. And add to existing provisions of 4.2 billion euros for delays to Europe's biggest defence project. CEO Tom Enders pointed to the strong demand for its smaller, greener planes. SOUNDBITE: Tom Enders, CEO, Airbus, saying (English): "We have decided to raise the production rate for our best selling 320 family to 50 aircraft a month from 2017 onwards." Airbus's A320 family jet is still below rival Boeing's targets for 52 single-aisle 737s a month by 2018. But more A320s will mean fewer A330s - they're being cut back further to six a month. 2014 was a record breaking year though for the world's second largest aerospace group. It made 629 deliveries of its commercial aircraft. Net orders were strongest at 1,400. And back orders stood at 6,300. Demand for some of its older aircraft hasn't been as strong. IG's Alastair McCaig. SOUNDBITE: Alastair McCaig, IG, saying (English): "Undoubtedly airlines have been looking to create more fuel efficient, cost efficient models and the short term squeeze we've seen in oil prices has maybe negated the necessity of many of these airlines to push quite so aggressively for upgrades to their existing fleets and this in its turn has maybe created a bit of a short fall in demand at this point in time." British Airways-owner International Airlines Group also had a good 2014 with operating profits soaring by 81 percent. Shares rose by 4.7 percent, hitting a record high. As a result the group upped its profit forecast for 2015 by more than 20 percent, outperforming its weaker continental rivals. The group has managed to stay ahead of the fast-growing low-cost sector thanks to its acquisition of budget carrier Vueling in 2013. Enabling it to compete with the likes of Ryanair and easyJet.