Safran reports 27 per cent rise in profits
Feb. 28, 2012, Paris, Fra. - French aircraft engine manufacturer Safran has reported a 27% rise in full-year net profit to $644 million in 2011 in comparison to $508 million recorded in 2010.
The rise in profit was mainly due to an increase in engine deliveries. The company is forecasting that the demand for its jet engines and aircraft equipment will increase in 2012.
Safran chairman and CEO, Jean-Paul Herteman, praised the company's growth potential despite the current financial and confidence crisis in Europe, delivering 35% growth in recurring operating income.
Herteman said: "We are investing in new products and technology, expanding our growth market footprint and consolidating our worldwide leadership in next-generation single aisle aircraft market."
The company has benefitted from the high demand for commercial jet engines in the aircraft makers ramp up production, and also the natural rise in demand for spares and maintenance as the global fleet of aircraft in service expands.
Safran generated $532 million of free cash flow last year, and it is anticipating cash flow in 2012 to represent about one third of operating income, which is expected to rise by 20% in comparison to the previous year.
The company also gained from stronger demand for commercial jet engines as aircraft manufacturers like Airbus and Boeing increased production leading to demand for spares and maintenance.
LEAP engine orders totalled 3,056 for the previous year and the company's joint venture with GE had delivered 1,308 engines. It is expected to deliver about 1,400 this year, while its backlog rose to $43 billion ($57 million).
The company's core propulsion division reported a 14.9% operating margin on a 9% rise in revenue to $6.11 billion. The company is expecting a 10% year-on-year rise in its revenue.