June 12, 2013 / 2:44 PM / 6 years ago

EADS backs off goal of $10 billion in U.S. revenues by 2020

Logo of EADS is seen at the European aerospace and defence group EADS headquarters in Les Mureaux near Paris January 12, 2011. REUTERS/Charles Platiau

WASHINGTON (Reuters) - European aerospace and defense company EADS EAD.PA likely will fail to meet its goal of generating $10 billion in non-Airbus revenues in the U.S. market by 2020 unless it makes a big acquisition, the head of EADS North America said on Wednesday.

The executive, Sean O’Keefe, cited the budget situation in Washington and other factors. “Short of an acquisition, I don’t see us hitting that number,” he told reporters.

O’Keefe said the U.S. unit’s revenues would be flat this year after reaching $1.6 billion in 2012.

He said EADS continued to examine possible acquisitions in the United States but provided no details on possible targets. He said valuations had come down, but it was not yet clear if prices would drop further.

He said Wall Street investors were not too concerned about the changing outlook, given EADS’ strong position in the commercial market as the parent of Airbus and continuing uncertainty about U.S. defense spending.

O’Keefe said EADS was optimistic that U.S. lawmakers would reinstate sufficient funding to extend production of the company’s UH-72 Lakota, a light utility helicopter that EADS builds for the U.S. Army, through 2014.

He said the fate of a possible Army program for a new armed scout helicopter was uncertain, given across-the-board budget cuts that took effect on March 1.

He said projected revenues in the United States would be part of a company-wide strategic review that will be completed in the coming months. He said he would be surprised if the new strategy included a specific revenue target.

Reporting By Andrea Shalal-Esa; editing by John Wallace; editing by John Wallace

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