Feb. 19 (Bloomberg) -- MTU Aero Engines Holding AG, Germany’s largest aircraft-engine maker, said operating profit beat its goals last year amid a jump in deliveries by plane producers, and the company forecast more growth in 2013.
Adjusted operating profit totaled 374.3 million euros ($500 million), exceeding a target of about 370 million euros, the Munich-based company said today in a statement. Sales rose 15 percent to 3.38 billion euros, matching analysts’ estimates.
MTU has benefited from rising production of Airbus SAS’s single-aisle A320 airliners, through its involvement in the International Aero Engines joint venture, and of Boeing Co.’s 777 model, for which the German company is a supplier in partnership with General Electric Co. Military activities also came in above expectations as the German air force supported forces in Afghanistan, MTU said today.
“We revised all of our forecasts upwards in the course of the year and met all these ambitious targets,” Chief Executive Officer Egon Behle said in a statement. “This gratifying result has taken us one big set closer to realizing our goal of 6 billion euros in revenue by 2020.”
MTU rose as much as 5.1 percent to 72.55 euros, the biggest intraday jump since April 25, and was trading up 3 percent at 12:16 p.m. in Frankfurt. The stock has gained 3.4 percent this year, valuing MTU at about 3.7 billion euros.
“The market environment remains very positive,” Markus Turnwald, a Frankfurt-based analyst at DZ Bank, said in a note to clients. “Given the conservative track record of the management, we see room for outlook upgrade within this year.”
Revenue, adjusted earnings and net income will probably all rise 10 percent to 12 percent this year, MTU said. Commercial-aircraft engine sales are expected to increase 20 percent to 25 percent, or in the “mid-teens” excluding acquisitions or disposals, it said. Spare parts sales will grow about 15 percent, with military sales stable.
Engine revenue will increase as MTU delivers more V2500 engines powering Airbus A320s, GEnx engines used on Boeing 787s and 747-8s, and GP7200s for A380s, Chief Financial Officer Reiner Winkler said in a statement.
MTU expects to ship parts for 200 GEnx engines this year, even with the grounding of Boeing 787 Dreamliners, Behle said. The flight stoppage, which began Jan. 16 because of electrical faults that remain unresolved, hasn’t affected the German engine maker, which has a 6.9 work share on the turbine, Behle said at a Munich press conference.
Production of the GEnx continues as Boeing is still building the 787 Dreamliner, Behle said, with the engine maker’s forecast assuming all turbines will be handed over. A halt in manufacturing of the twin-aisle plane would probably be followed by a stoppage on the engine side, he said.
Deliveries of Airbus Military A400M transport planes, delayed partly because of faults with the TP400D engine built by a group that also includes Rolls-Royce Holdings Plc and Safran SA, will no longer be affected by difficulties with the turbo-propeller, Behle said. France is the lead customer and due to receive the first aircraft before mid-year.
Engines for the first three A400Ms will need to be upgraded to introduce a gear-box fix developed last year, Behle said. The modification became necessary because of a combination of factors, including a material flaw and by strain placed on the gearbox by the massive, eight-bladed propeller, he said.
MTU’s order backlog last year rose 8.9 percent a record 11.5 billion euros “despite the fact that it does not yet include a certain number of orders,” Behle said.
Many of the deals are linked to sales of geared turbofans being developed by United Technologies Corp.’s Pratt & Whitney for applications such as the Bombardier Inc. CSeries, where engine certification is imminent, and the A320neo. Sales of the turbine type exceed 3,000 units and are beating expectations, Behle said.
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