Safran raises its sales and free cash flow forecasts for 2022, Company news

Safran raises its sales and free cash flow forecasts for 2022, Company news

PARIS, Oct 28 (Reuters) – Safran raised its 2022 revenue and free cash flow forecast on Friday, as its third-quarter revenue rose 29.9% year-on-year. carried by a dollar strong.

Safran CEO Olivier Andriès said in a statement that the outlook for the year “reflects exchange rate fluctuations as well as our confidence in achieving our objectives”.

These statements contrast with those of Boeing, which announced on Wednesday that engine deliveries represented one of its main production constraints.

Safran and General Motors are partners in the CFM International joint venture, which notably produces engines for the Boeing 737 model.

Engine makers said they were having difficulty obtaining castings from two of their main suppliers, but GE said this week that deliveries of LEAP-type engines by CFM International had increased by 50% compared to the previous quarter.

Safran’s sales increased by 17.9% on an organic basis in the third quarter to reach 4.85 billion euros, thanks in particular to the Propulsion and Aircraft Interiors activities.

The group, which anticipated a turnover of between 18.2 and 18.4 billion euros in 2022, now expects it to be around 19 billion euros, forecasting growth in the activities of service and a rising dollar.

The aeronautical equipment manufacturer also indicated that it expects free cash flow generation of more than 2.4 billion euros in 2022, against 2.4 billion euros previously.

However, he warned that the increase in his hedge portfolio would have a dilutive effect on the operating margin.

Safran also said it expects to complete the acquisition of Thales’s electrical systems business in 2023.

The group also announced its intention to buy back up to 9.4 million of its own shares, or 2.2% of the capital, in order to eliminate the risk of dilution linked to convertible bonds maturing in 2027.

The Board of Directors has decided to propose the renewal of the mandates of Ross McInnes and Olivier Andriès as Chairman and Chief Executive Officer of Safran at the general meeting scheduled for 2023. (Tim Hepher report; French version Camille Raynaud , edited by Kate Entringer)