Published by Global Banking and Finance Review
Posted on February 14, 2025
PARIS (Reuters) -French jet engine maker Safran raised its profit and cash forecasts for 2025 on Friday, after posting a 30% jump in annual core income led by increased air traffic.
Safran reported 4.119 billion euros ($4.31 billion) in recurring operating income for the 12 months ended December 31, as sales rose 18% to 27.317 billion euros in 2024. It forecast 4.8 billion-4.9 billion euros of comparable profit for this year, with revenue still projected up around 10%.
Analysts were on average expecting 4.132 billion euros in recurring operating income on revenues of 27.157 billion for 2024, according to a company compiled consensus. They are also forecasting 4.814 billion euros of core profit for 2025.
Together with GE Aerospace, Safran co-produces the best-selling LEAP engine for all Boeing and most Airbus narrow-body jets through their CFM International joint venture.
Parts for the engines criss-cross the Atlantic, with assembly lines in France and the United States, while Safran imports other parts to Boeing from Canada and Mexico, putting it in the crosshairs of a possible regional and wider tariff war.
"Today it is very difficult to give a precise answer until we know the conditions of any possible tariffs, if they confirmed," Safran CEO Olivier Andries told reporters.
"It is probable that these measures will have an impact but today it is very difficult to quantify it."
Safran predicted a 15-20% rise in LEAP deliveries in 2025 and revised upwards a forecast for spare parts revenue, while warning that risks also remained from fragile supply chains.
After a tug of war over scarce engine parts between new aircraft assembly lines and maintenance shops for existing jets, Safran CEO Olivier Andreis said meeting the requirements of both sets of customers remained priorities for profitable growth.
Overall propulsion revenue rose 15% last year led by services linked to strong air traffic, Safran said.
Air travel also helped to drive revenue at its Equipment and Defense division up 18%, with an increase in long-haul traffic pushing up demand for maintenance of landing systems.
Safran's seats business reached breakeven after significant restructuring and overall Aircraft Interiors revenue grew 25%.
($1 = 0.9565 euros)
(Reporting by Tim Hepher; Editing by Shri Navaratnam, Rashmi Aich and David Evans)
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