EADS makes EUR1.79 Bln Profit, Sees 2009 Drop

European aerospace group EADS reported a sharp rise in 2008 operating profit on Tuesday, beating expectations as its Airbus unit climbed out of the red, but it forecast a drop in profit in a "challenging" 2009.

EADS warned of "significant" potential further charges in 2009 related to its delayed A400M military aircraft after taking EUR704 million euros (USD$890 million) of provisions in 2008.

Earnings before interest and tax (EBIT) as well as before goodwill and exceptional items, EADS' preferred way of measuring its operating performance, rose to EUR2.83 billion from just EUR52 million in 2007 when profits were hurt by restructuring charges, delivery delays and a weak dollar.

Revenue grew 11 percent to EUR43.27 billion.

Airbus, which saw record deliveries in 2008 despite growing doubts over future demand, swung to an operating profit of EUR1.79 billion from an EUR881 million loss in 2007 as its revenue grew 9 percent to EUR27.45 billion.

EADS posted a 2008 group net profit of EUR1.57 billion after a EUR446 million loss in 2007.

EADS proposed a dividend of 0.20 euros, up from 0.12 euros.

Free cash flow before financing fell 12 percent to EUR2.886 billion, it added.

For 2009, EADS said a previously published Airbus order forecast of 300-400 planes was "challenging" and that the planemaker faced increasing uncertainties over the second half.

It predicted roughly stable group revenue and operating profit before one-offs that would be "down in 2009 but significantly positive".

"At this stage, with the current level of visibility, EADS is not expecting to consume more than EUR1.5 billion of free cash flow after customer financing in 2009," EADS said in a statement.