Airbus targets near-doubling of earnings by 2029, launches buyback

By Gianluca Lo Nostro

July 21 (Reuters) - Airbus laid out medium-term targets including a near doubling of profits and stronger shareholder returns on Tuesday, signalling confidence in its ability to ramp up production as a bruised aerospace sector turns the corner on supply disruption.

The world's largest civil planemaker said it was targeting a core profit of €12 billion to €13 billion ($13.69 billion to $14.83 billion) in 2029, and announced a €5 billion share buyback programme.

The goal represents a sharp rise from €7.13 billion of adjusted earnings before interest and taxes Airbus generated last year and is well above a 2026 target of €7.5 billion.

Airbus is seeking to boost profits by increasing aircraft deliveries to meet strong airline demand while gradually overcoming supply-chain disruption and engine shortages that have constrained output across the aerospace industry.

The company said it expected its dominant commercial aircraft business to generate around €10 billion in operating profit in 2029.

J.P. Morgan analysts said earlier this month Airbus was likely to reach that level of profit in its commercial aircraft business within three years.

"We have a level of visibility we've never had before. We've put behind us a lot of challenges and we've cleared the skies to move forward, and we think we're in a good place to give an outlook," CEO Guillaume Faury told investors gathered in London.

Airbus started the year slowly because of supply-chain and engine bottlenecks but has since accelerated deliveries, increasing first-half handovers by 15% year-on-year.

Airbus left its 2026 guidance, which includes a 10% increase in commercial deliveries to 870 jets, unchanged.

"We have the supply chain in a much better place. We're still having issues here and there that will probably continue as we continue to go higher, but it's in a much better place in the years going out of COVID," Faury told reporters late on Tuesday.

AIRBUS EXAMINING A350 PRODUCTION INCREASES

Airbus said it was seeing demand for wide-body jets and looking at significant increases in production of the A350 in coming years.

Airbus Commercial CEO Lars Wagner told reporters he expected protracted problems over engine supplies for smaller A320neo jets to be resolved by 2028.

However, Airbus said it was pushing for more engines from RTX unit Pratt & Whitney for 2027 following a tug of war between new assembly lines and maintenance plants for scarce supplies.

Airbus also hoped to receive more from alternate supplier CFM, which was already meeting its agreed quantities.

Pratt & Whitney said earlier on Tuesday that maintenance disruption that has left hundreds of aircraft grounded was easing, with the number of aircraft grounded for engine-related reasons down 40% from the peak.

Airbus confirmed it was looking at launching longer versions of its A220 and A350 aircraft but gave no timeline for a decision.

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(Reporting by Gianluca Lo Nostro; Additional reporting by Tim Hepher and David Shepardson; Editing by Matt Scuffham and Jamie Freed)