Airbus parent EADS says it lost $684M in '07

PARIS — Airbus parent EADS reported annual losses of 446 million euros ($684.16 million) Tuesday, a year marred by the botched rollout of both military and commercial aircraft.

European Aeronautic Defense & Space (EADS) returned to profit in the fourth quarter and said it would boost earnings further this year, though the guidance the company issued was below analyst expectations.

EADS shares, which have plunged by a fifth since the beginning of the year, fell 6.8 percent Tuesday to 16.10 euros ($24.75).

"I am not content with the 2007 figures," CEO Louis Gallois said in a statement. "In 2007, we have prepared the future and we have cleaned up part of the past."

The company reported a fourth-quarter net profit of 259 million euros ($397.31 million), after a 768 million-euro ($1.18 billion) loss in the October-December period the year before.

The company recorded fewer charges in the quarter on the long-delayed A380 superjumbo, which was finally delivered to Singapore Airlines in October.

Airbus, based in Toulouse, France, posted a fourth-quarter operating loss of 204 million euros ($312.94 million) after a loss of 1.72 billion euros ($2.64 billion) in 2006.

For the full year, EADS lost 446 million euros ($685.5 million), compared with a profit of 99 million euros ($152.16 million) in 2006.

"I think that the worst is behind them," said Harald Liberge-Dondoux, an analyst with CM-CIC Securities in Paris. "We are not out of the tunnel. There will still be a few little pieces of bad news, but not of the same scale."

For 2008, EADS forecast earnings before interest and tax at 1.8 billion euros ($2.76 billion), "reflecting higher comfort in its improving ability to drive profitability."

Sales in 2008 are expected to top 40 billion euros, EADS said. In 2007, revenue was virtually flat at 39.12 billion euros ($60.01 billion), compared with 39.43 billion euros a year before.

Citigroup and Merrill Lynch said EADS' guidance for the full year was below expectations.

Delivery of the company's A380 superjumbo was set back for nearly two years, cutting into profits. In November, Airbus announced a delay to its A400M military transport turboprop that could cost as much as 1.4 billion euros ($2 billion) in penalties and other charges. The slumping dollar has also sapped profits.

EADS scored a major victory last month when, along with its U.S. partner Northrop Grumman, it won a $35 billion Pentagon contract to build refueling tankers for the Air Force. EADS has sold tankers to Australia, Saudi Arabia and the United Arab Emirates, and is in talks with Britain.

EADS said earnings before interest and tax — a closely watched indicator — fell to 52 million euros ($79.77 million) in 2007 from 399 million euros ($613.26 million) in 2006.

EADS said it expects Airbus to deliver about 470 planes in 2008 compared with 453 in 2007. Deliveries will peak in 2011-2012, the company said.

The company said the commercial aircraft market will remain "resilient" in 2008, predicting Airbus' orders will fall to about 700.