Military plane cost hits Airbus profits

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By BBC

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Aircraft manufacturer Airbus reported a drop in 2016 profits, mainly because of a charge on the A400M military plane.

Its net income fell by 63% to 995m euros (£838m), although revenue went up 3% to 66.5bn euros (£56bn).

The results are the first since Airbus started simplifying the company by mixing its European business with the parent company, previously called EADS.

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Chief executive Tom Enders said: “We’ve delivered on the commitments we gave a year ago.”

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He added: “We achieved our guidance and objectives, with one exception, the A400M, where we had to take another significant charge totalling 2.2bn euros (£1.85bn) in 2016.

The A400M has suffered a number for setbacks over the years.

Earlier this month, one A400M broke down on the ground while carrying German Defence Minister Ursula von der Leyen.

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German Defence Minister Ursula von der Leyen before boarding the plane which flew from Germany to Lithuania but then broke down
German Defence Minister Ursula von der Leyen before boarding the plane which flew from Germany to Lithuania but then broke down

Another crashed on a test flight in Spain in 2015, leading to the deaths of the four crew members.

“De-risking the programme and strengthening programme execution are our top priorities for this aircraft in 2017,” Mr Enders said.

Commercial success

A late surge in deliveries of civil planes boosted overall profits at Airbus – analysts had been expecting a 7% fall.

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The company said its helicopter division had performed well “despite a difficult market environment”.

In 2017 it expects the world economy and air traffic to grow in line with current independent forecasts, assuming there are no major disruptions.

It expects to deliver more than 700 commercial planes during the year.

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