MTU Aero Q1 Hit By A320neo Delays

April 28, 2016

First-quarter revenue at MTU Aero Engines was hurt by delays to deliveries of the Airbus A320neo, although the company confirmed its targets for the year.

MTU, which works with Pratt & Whitney on the geared turbofan engine for the A320neo, said overall group revenue was flat at EUR€1.098 billion (USD$1.25 billion).

Revenue in its commercial aircraft engine division fell 13 percent in the quarter to EUR€556 million.

However, MTU's adjusted earnings before interest and tax (EBIT) rose 34 percent to EUR€131 million, thanks to its maintenance business.

Airbus earlier on Thursday reported a heavier-than-expected seasonal outflow of cash, reaching EUR€2.9 billion, as problems with suppliers and other issues hold up deliveries.

Engine problems that Pratt has promised to fix by the summer mean close to two dozen A320neo jets are awaiting delivery at Airbus's European plants.

"We are on course as far as our expectations for the full year are concerned, with the ramp up of the geared turbofan engines scheduled for the second half of the year," MTU's Michael Schreyogg said in a statement.

It also maintained a forecast for 2016 revenues of between EUR€4.6 billion and EUR€4.7 billion and an EBIT margin of around 10 percent.

(Reuters)