MTU Aero Engines raises forecast

MTU Aero Engines AG generated revenues of €2,548.0m in the first six months of 2017, up 11% on the previous year (1-6/16: €2,299.2m). The group’s operating profit increased by 26% from €254.1m to €320.8m, resulting in an EBIT margin of 12.6% (1-6/16: 11.1%). Earnings after tax increased by 29% from €176.1m to €227.5m. “The development in the first half year allows us to provide a more precise full-year guidance based on concrete targets rather than approximate ranges, and we can raise our forecast,” said Reiner Winkler, CEO of MTU Aero Engines AG. MTU expects revenues to reach some €5.3bn by the end of 2017, which is higher than the original forecast of between €5.1 and €5.2bn. Winkler adds: “Deliveries for the Geared Turbofan programs are set to increase significantly in the second half of the year, with a corresponding impact on earnings.” Nonetheless, MTU’s operating profit could well be higher than anticipated, rising to around €560m (adjusted EBIT in 2016: €503.0m). This will result in a stable EBIT margin for MTU. Earnings after tax are expected to amount to approximately €390m in 2017 (adjusted net income for 2016: €345.4m). In the first six months of 2017, the commercial maintenance business recorded the highest growth rate in terms of revenues, which increased by 32% to €1,181.0m (1-6/16: €893.3m). The main source of these revenues was the V2500 engine, which powers the Airbus A320 family. In the six months to the end of June 2017, revenues in the commercial engine business grew by 4% from €1,200.9 million to €1,242.8 million. The V2500, the GEnx for the Boeing 787 and 747-8, and the PW1100G-JM for the A320neo accounted for the greatest share of these revenues.