Airbus keeps targets, considers buyback as jet programmes on track

By Cyril Altmeyer and Victoria Bryan

PARIS/BERLIN (Reuters) - Airbus Group said it would make a decision in the autumn on a share buyback programme after reporting its main commercial jet programmes were on track and confirming its full-year guidance on Thursday.

Europe's largest aerospace group said it was pushing ahead with a production increase for its new A350 jet and that its revamped A320neo remained on schedule. The A380 superjumbo will break even as planned this year, it said in a statement, as it posted in-line first quarter results.

After a boom in jet demand that accounts for the bulk of a roughly $1 trillion stockpile of orders on the European company's books, Airbus and U.S. rival Boeing are increasingly focusing on how to achieve higher production goals.

Airbus will ask shareholders at its annual meeting on May 27 for permission to buy back up to 10 percent of its share capital. Chief Financial Officer Harald Wilhelm said the company would come back to this issue in the autumn, once it has more clarity on divestments and production plans.

Shares in Airbus were up 1.3 percent at 0724 GMT, outperforming a 0.2 percent fall for leading European shares.

First-quarter revenue fell 5 percent to 12.078 billion euros ($13.4 billion) due to lower commercial plane deliveries that were partially offset by the impact of a weaker euro. Operating income before one-off items fell 7 percent to 651 million euros.

Analysts had on average predicted operating profit of 647 million euros on revenue of 12.6 billion.

BACKLOADED DELIVERIES

Commercial jet deliveries are expected to be "backloaded" towards the later part of the year, Airbus said. It delivered just one A350 jet in the first quarter but this was in line with contracted delivery dates, Wilhelm said, confirming a target to deliver 15 of the widebodies this year.

Airbus logged 134 plane deliveries in the first quarter, compared with 141 in the year-ago period.

Free cashflow swung to a positive 452 million euros in the first quarter from a negative 2.034 billion, swelled by the sale of part of Airbus's stake in Dassault Aviation .

Wilhelm said Airbus would be looking to sell more of its remaining stake in Dassault once a lock-up period expires towards the end of this year.

Airbus said that based on its current view of production it would achieve breakeven in free cashflow in 2015 before mergers and acquisitions.

For 2015, Airbus also expects slightly higher deliveries and a higher order book. It sees higher revenue and a slight increase in core operating income before mergers and acquisitions.

Boeing last week said first-quarter net income rose to $1.34 billion from $965 million a year earlier. Revenue rose 8 percent to $22.15 billion.

($1 = 0.9016 euros)

(Additional reporting by Tim Hepher; Editing by James Regan and Vincent Baby)