Business

Airbus profits rise but more A400M problems loom

Airbus A400M Image copyright Airbus
Image caption The A400M programme had to be bailed out with more money because of production delays

Aerospace group Airbus has posted a rise in profits for the first nine months of the year, but warned of more problems for its A400M military plane.

Underlying earnings rose 12% to €2.59bn ($3.2bn; £2.1bn) for the nine-month period, with revenues up 4% to €40.5bn. Net income rose 16% to €1.399bn.

But Airbus highlighted a "negative cost and risk evolution" for its delayed A400M transport aircraft.

The programme hit problems in 2010 and received a bailout of €3.5bn.

Built at a cost of €20bn with orders from several European countries, the A400M was a fixed-priced contract that hit production problems and cost-overruns.

Airbus said it would account for any future impact in its full-year results to be published early next year.

The company's finance director did not rule out Airbus taking a one-off accounting charge against future problems.

Harald Wilhelm told journalists: "Given our past history on it (the A400M), the objective remains to avoid any incremental charge, but we are on the way to assessing it. If you ask me whether I can exclude it, I cannot say that this is the case, so it's work in progress."

Outside of the A400M problems, Airbus, whose wing-making operations are in the UK, said that the company's products remained "strong".

The order book was worth €765.4bn as of 30 September, compared with €680.6bn at the end of 2013.

Airbus Group chief executive Tom Enders said: "An improved operational performance drove revenues and profitability higher over the first nine months of 2014."

However, adverse exchange rates had impacted on profits in the last three months.

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