EADS sees 'significant improvement' from 2012: report

8th December 2010, Comments 0 comments

The European aerospace and defence group EADS said Wednesday it expected a "significant improvement" in operating profit from 2012 on but that next year would be as tough as 2010.

"We expect significant improvements for 2012 and the following years at the operating profit level," finance director Hans Peter Ring told the financial daily Boersen-Zeitung.

Until then however, "programmes such as the A350 and A400M will have to be financed," which meant 2011 will be "as difficult as 2010 at the operating level," he warned.

The A350 wide-body airliner and the A400M military transport plane are two aircraft on which EADS is betting for future earnings, but their development has posed problems for the European plane maker Airbus, which is owned by EADS.

The parent group is also hoping for a favourable trend in foreign exchange rates, which should help it compete with US arch rival Boeing since both bill customers in dollars.

"Negative exchange rate effects have hurt us in recent years, and are one reason why we expect a difficult year in 2011," Ring said.

"A euro that remained under 1.30 over the long term would be a good thing for us," he added.

On Wednesday, the single European currency traded for a little more than 1.32 dollars.

Shares in the European Aeronautic Defence and Space Company (EADS) showed a leap of 2.92 percent to 18.45 euros in morning Paris trading, while the CAC index of leading stocks was up by 0.27 percent overall.

© 2010 AFP

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