Airbus sparks relief rally as first-quarter profit beats forecasts
By Tim Hepher and Cyril Altmeyer
PARIS (Reuters) - Airbus Group (AIR.PA: Quote) posted better than expected first-quarter earnings on Tuesday, sparking a relief rally in its shares as it dodged the impact of higher costs for its new A350 jet, which remains on track for a late-2014 debut.
Shares in the world's second-largest aerospace group after Boeing (BA.N: Quote) rose by around 5 percent to 51.92 euros, their highest in more than a month, after it issued an upbeat report on A350 testing and exceeded profit forecasts by about 10 percent.
"This is a very good start to the year and guidance remains unchanged," Cantor Fitzgerald said in a note to investors.
Airbus shares had fallen 11 percent since the start of the year, underperforming Boeing, which raked in more orders than its European arch-rival in the first quarter.
The Franco-German company is among a number of European exporters facing concerns over recent gains in the euro.
First-quarter operating income before one-off items fell by a smaller than expected 4.6 percent to 700 million euros ($963 million) as revenue rose 5 percent to 12.6 billion, and analysts said it had improved execution on key programs.
Analysts were on average expecting underlying quarterly operating income to fall 13 percent to 644 million euros on revenue of 12.4 billion, according to a poll carried out for Reuters [ID:nL6N0NV1UF].
Confirming recent comments by Europe's aviation regulator, Airbus Group said its latest jetliner, the A350, was "progressing towards certification" in the third quarter in time for first delivery by the end of the year to Qatar Airways. Continued...