Safran Q1 revenue rises 3.3 pct, keeps goals despite euro
PARIS, April 23
PARIS, April 23 (Reuters) - France's Safran posted a 3.3 percent rise in first-quarter revenue and confirmed its outlook for 2014 despite concerns over the strength of the euro, telling investors it had tempered the currency's rise through improved hedging.
Adjusted revenue rose 3.5 percent on a like-for-like basis to 3.443 billion euros ($4.75 billion), Safran said on Wednesday, buoyed by a recovery in security revenue and strong sales of aircraft equipment.
It said its 2014 goal of mid-single-digit growth in adjusted revenue would be "achievable" if the euro stayed at the group's average first-quarter rate of $1.37 throughout the year. Its comparable rate for the first quarter of 2013 had been $1.32.
Safran also reaffirmed other main targets including a low-double-digit percentage improvement in core operating income.
Safran is a major supplier to planemakers Airbus and Boeing, which are both producing record numbers of aircraft to keep up with demand, mainly in emerging markets.
The key civil aftermarket grew 12.4 percent in dollar terms, driven by first overhauls of the CFM56 engine that Safran co-produces with General Electric and also by GE90 engines, GE's motor for the Boeing 777 in which Safran also has a stake.
Civil demand pushed revenue in the aerospace propulsion division up 2.2 percent to 1.825 billion euros as military demand remained flat amid stalled spending in western Europe.
But there was a dip in helicopter revenue due to production delays and bad weather in North America, which Safran said would iron itself out by the end of the year.
The strongest gains came in sales of equipment such as landing gear for the Boeing 787 Dreamliner, which is catching up in production following delays and technical problems. The aircraft equipment unit lifted its revenue by 11 percent to 1.02 billion euros.
Defence sales fell by a steeper-than-expected 12 percent to 257 million euros due to delayed deliveries of missile guidance systems, but are expected to be flat for the year as a whole.
Security revenue rose for the first time since the second quarter of last year, adding 1.5 percent to 345 million euros after a boost from sales of detection systems, Safran said. ($1 = 0.7248 Euros) (Reporting by Tim Hepher and Cyril Altmeyer; Editing by James Regan)