By Robert Wall
French aerospace supplier Safran SA lifted its earnings outlook
for the year as it reported an 89% jump in profit, aided by
disposals.
Net profit for the first six months was EUR1.2 billion ($1.28
billion), compared with EUR616 million in the year-prior period,
the Paris-based company said Thursday. The profit increase reflects
a EUR419 million euro gain from Safran's disposal in May of its
stake in Ingenico, a company involved in payment services.
Safran sales in the first six months rose 16.6% to EUR8.4
billion, as the maker of aircraft and rocket engines was helped by
a strengthening of the dollar against the euro. The currency change
accounted for EUR782 million of the sales increase.
Safran raised its outlook for full adjusted recurring operating
income on the strength of its civil aerospace aftermarket
activities. Operating income will rise by a midteen percentage,
rather than by low double digits as initially forecast, it
said.
"The continued healthy growth in demand for air travel and
improving economics for many of our airline customers underpin our
confidence in the civil aftermarket and allow us to raise our
profitability guidance for this year," Chief Executive Philippe
Petitcolin said.
Safran is bucking a trend in the aerospace industry that has
seen several companies recently report weak aftermarket
business.
The French company also said revenue could advance in the low
double digits, assuming an exchange rate for the rest of the year
of about $1.12 per euro. The current forecast remains for high
single-digit percentage growth, based on an exchange rate of $1.20
per euro.
Safran also said it had signed a contract with Egypt for the
sale of advanced air-to-ground missiles. The sale is part of
Egypt's purchase of 24 French Rafale strike fighters made by
Dassault, for which Safran also provides engines.
Write to Robert Wall at robert.wall@wsj.com