Growth in line with annual outlook; the target for adjusted recurring operating income growth is confirmed, notably due to currency hedging
All revenue figures in this press release represent adjusted revenue. Please refer to definitions contained in the Notes on page 7. Comparisons are established against 2013 figures restated for the application of IFRS 11, Joint Arrangements. Please refer to the Annex on page 8.
Key figures for the first quarter of 2014
First-quarter 2014 adjusted revenue was Euro 3,443 million, up 3.3% year-on-year, up 4.9% at constant currency or 3.5% on an organic basis.
Revenue growth was driven by continued momentum in OE and services at most Aerospace activities. Revenue growth resumed in Security. Defence sales were down due to temporary delays in deliveries.
Civil aftermarket grew 12.4% in USD terms, driven by first overhauls of recent CFM56 and GE90 engines.
Full-year 2014 outlook is confirmed despite the Euro’s persistent strength.
If the average EUR/USD spot rate of 1.37 were to remain throughout 2014 the mid-single digit growth objective for adjusted revenue would remain achievable, the positive effect of the improving hedge rate partially offsetting the adverse translation effect.
The hedging policy isolates adjusted recurring operating income from current EUR/USD variations except for the part generated in USD by activities located in the US, subject to the translation effect when converted into Euro. The target hedged rate for 2014 is 1.26.
The low-double digit target for growth of adjusted recurring operating income for 2014 is confirmed.
Key business highlights for the first quarter of 2014
Safran and Albany International inaugurated a plant in Rochester, New Hampshire that produces 3D woven composite parts for the new LEAP engine. A sister plant will soon be inaugurated in Commercy (Meuse, France).
CFM order momentum remains very strong, both for current-generation CFM56 engines and for next-generation LEAP engines. Orders for 557 CFM56 engines were recorded in the first quarter including from VietJetAir (Vietnam) for A320ceo, Transocean Air (Japan) and GECAS (US) for Boeing 737 NG aircraft. Orders for LEAP engines totalled 606 in the first quarter. Orders for LEAP-1B powered Boeing 737 MAX aircraft were placed by GECAS, Air Canada and Comair (South Africa). Since the end of the first quarter Lufthansa (Germany) placed an order for 40 A320/A321neo aircraft powered by LEAP-1A engines.
Safran and Avic announced an initial Chinese order for 120 WZ16/Ardiden 3C helicopter engines to power the AC352 helicopter. This new-generation turboshaft engine programme is jointly developed by Safran and Avic on an equally shared basis.
Messier-Bugatti-Dowty (Safran) has been selected by Boeing as one of two suppliers of wheels and carbon brakes for all models of the Boeing 737 MAX.
The French defence procurement agency (Direction générale de l’armement) chose Sagem (Safran) to modernize the optronic systems on 4 air defense frigates in the French navy.
Over 2 million highly-secure passports and ID cards have been issued to Chilean citizens by Morpho (Safran) since the start of production in September 2013.
Source / Author: Safran