PARIS - Safran raised its full-year targets on July 28 after posting stronger-than-expected first-half results, with shares climbing 2.2% as robust demand for spare parts pushed operating margin to a record 18.4%. The French engine maker's mid-year recurring operating profit jumped 29% to €3.24 billion, beating forecasts, while revenue rose 19% to €17.57 billion, fueled largely by a 27.9% surge in civil engine spare parts sales.
CEO Olivier Andries said civil aircraft activity remains well above pre-conflict forecasts, echoing the upbeat outlook recently issued by CFM partner GE Aerospace. Looking ahead, Safran now expects full-year revenue growth in the "mid-teens," up from "low-to-mid-teens," and projects operating profit of €6.4-6.5 billion, an increase from its earlier €6.1-6.2 billion guidance.
The company also raised its LEAP engine delivery growth forecast to "high teens" from 15%, and Andries pointed to strong momentum in defense as Safran expands capacity in areas like positioning and navigation. Uncertainty lingers, however, over Safran's fighter-engine venture with Germany's MTU following the collapse of the Franco-German-Spanish FCAS fighter program; Andries said the venture is funded only through September, with its future hinging on decisions in Paris and Berlin about next-generation military aircraft.
