* Sees 2013 EBITA 5-10 pct below target
* "Discontinuity" needed with AnsaldoBreda unit
* Cuts free operating cash flow target
(Recasts lead, adds detail)
MILAN, Nov 7 Italian air defense group
Finmeccanica will miss its core earnings target for
the year because of continued problems at its train-making unit
The state-controlled group said in a statement it expected
earnings before interest, tax and amortisation (EBITA) to be
some 5-10 percent below a 1 billion euro ($1.3 billion) target
set previously and adjusted for the recent sale of its Ansaldo
Chief Executive Alessandro Pansa recently told trade unions
the group was in talks with foreign manufacturing companies to
sell loss-making AnsaldoBreda as part of an asset disposal plan
to strengthen its balance sheet.
The company gave another signal of its intentions on
Thursday, saying it was necessary "to introduce a strategic and
operational discontinuity within AnsaldoBreda".
Finmeccanica, Italy's second largest employer, has struggled
to carry out planned sales due to political opposition to
foreign takeovers at a time when the economic crisis has forced
many Italian entrepreneurs to put their businesses on the block.
Finmeccanica is 30 percent owned by the Italian state and
needs government backing for sensitive strategic issues such as
disposals. Delays in its asset disposal plans have prompted
ratings agencies to downgrade Finmeccanica to junk.
The company said it expected negative free operating cash
flow for the year to the tune of 350 million-450 million, from
previous cash positive guidance of 100 million euros, due to
The core aerospace and defence businesses remained cash
positive, Finmeccanica said, adding it expected to post a net
profit for the year due to the sale of Ansaldo Energia.
Finmeccanica agreed in October to sell the gas plant subsidiary
to the state-backed FSI fund.
In the first nine months EBITA fell 3 percent to 11.343
($1 = 0.7472 euros)
(Reporting by Stephen Jewkes; Editing by Anthony Barker)