MTU Aero Engines, forecast raised in H1
July 28 2017, MTU Aero Engines released their half year results. The company generated revenues of €2,548.0 million in the first six months of 2017, up 11% on the previous year (€2,299.2 million). The group’s operating profit increased by 26% from €254.1 million to €320.8 million, resulting in an EBIT margin of 12.6%. Earnings after tax increased by 29% from €176.1 million to €227.5 million.
“The development in the first half year allows us to provide a more precise full-year guidance based on concrete targets rather than approximate ranges, and we can raise our forecast,” said CEO, Reiner Winkler.
MTU expects revenues to reach some €5.3 billion by the end of 2017, which is higher than the original forecast of between €5.1 and €5.2 billion.
Commercial maintenance business
In the first six months of 2017, the commercial maintenance business recorded the highest growth rate in terms of revenues, which increased by 32% to €1,181.0 million (€893.3 million). The main source of these revenues was the V2500 engine, which powers the Airbus A320 family.
“Q2 revenues amounted to €592.6 million, making this the seventh consecutive record-breaking quarter for the commercial maintenance business,” added CPO, Michael Schreyögg.
“We expect this positive trend in the commercial maintenance business to continue through to the end of the year, and that full-year revenues expressed in U.S. dollars will increase by a percentage in the mid-to-high teens,” said CEO Winkler.
Until now, MTU had reckoned with an increase in the region of 10%.
Commercial engine business
In the six months to the end of June 2017, revenues in the commercial engine business grew by 4% from €1,200.9 million to €1,242.8 million. The V2500, the GEnx for the Boeing 787 and 747-8, and the PW1100G-JM for the A320neo accounted for the greatest share of these revenues.
“Spare parts sales developed particularly well,” added Winkler. “In U.S.-dollar terms, we expect this area of business to grow by a high single-digit percentage in 2017.”
Previously, MTU’s outlook for spare parts sales foresaw a growth rate in the mid-single digit percentage range.
Military engine business
Revenues in the military engine business decreased by 28% to €172.5 million (€240.2 million). The EJ200 Eurofighter engine was the main source of these revenues.
“In the light of delays in the EJ200 program and an outstanding after-market servicing agreement for the RB199 Tornado engine, we are expecting revenues in our military engine business to decrease by a percentage in the mid-teens range. We should be able to make up for some of the delays later this year, and then catch up fully in 2018,” said Schreyögg.
At the beginning of the year, MTU had expected a decrease in military engine revenues in the high single-digit percentage range.
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