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Friday, August 3rd, 2018
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LATEST NEWS
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Rolls-Royce has delivered better-than-expected half-year results, allowing the company to raise its full-year earnings outlook.
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Pre-tax profit of £81 million was reported for the first half of 2018 compared to a loss of £126 million for the same period last year. Underlying operating profit was reported at £141 million compared to a loss of £84 million for the same period last year. As a result, the Company anticipates being able to post an underlying operating profit on the region of £450 million, give or take £100 million, for the full year 2018.
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The news comes on the back of the announcement earlier this year of the shedding of 4,600 jobs over the next two years in a bid to save £400 million, the largest reduction in the company’s workforce since 5,000 jobs and 1,000 contractors were shed in 2000.
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Chief executive Warren East commented that: “Financial results were ahead of our expectations, with strong growth from civil aerospace and power systems, and we achieved a number of operational and technological milestones.
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“Reflecting our progress to date and growing confidence for the full year, we now expect both underlying profit and cashflow for 2018 to be in the upper half of our guidance range.” He then added that Rolls-Royce continues to be “impacted by the challenge of managing significant Trent 1000 in-service issues”.
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A £554 million writedown followed from a raft of technical issues with its engines, having uncovered durability problems with numerous Package C Trent 1000 engines, followed by revelations in June of issues with a small number of its Package B Trent 1000 engines. Rolls-Royce said: “The Trent 1000 in-service engine issues have caused significant disruption for a number of our customers, which we sincerely regret.
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“We continue to work hard to remedy this situation and have made further good progress on the implementation of long-term solutions in the first half of the year.” (£1.00 = US$1.30 at time of publication.)
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As the International Air Transport Association (IATA) has formed an agreement with CFM International (CFM) to improve the opportunities available to third-party providers of engine parts and MRO services on the CFM56 and the new LEAP series engines, authorised CFM repair station Aero Norway is set to be a beneficiary alongside airlines, lessors, other third-party MROs and parts manufacturers. The benefits will accrue for all parties via increased competition in the marketplace for maintenance, repair, and overhaul services on engines manufactured by CFM. The result will be to reduce operating costs.
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Glenford Marston, CEO of Aero Norway praises CFM on reaching such a significant agreement with IATA and considers the knock-on effect that their new conduct policies will have across the entire industry.
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“Authorised third-party repair shops like Aero Norway are part of a recognised expert supply chain and we are keenly awaiting ratification of the proposed new conduct policies” explains Marston. “These proposed measures mean that we will be able to pass on savings directly to airline customers, by reducing our ‘fully-burdened’ rates which presently include licence fees and a % of revenue per engine – this is our chance to offer more flexible engine MRO solutions and to give something back.”
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He goes on to say that maintaining dispatch reliability, and reducing operating costs to ensure that airlines can thrive as businesses by continuing to offer affordable flights, are key aspects of the industry. “As OEMs seek to tighten their hold on the supply chain, operators and lessors of mature aircraft assets face enormous pressure as they seek to maintain, upgrade and transition older aircraft cost-effectively in the face of continued delays in new aircraft deliveries.”
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Specifically the agreement covers CFM56 series engines. The CFM56-5B is the engine choice of the global A320 family due to its high reliability and durability, and the CFM56-7B is exclusively powering the B737 NG – making it the most popular engine combination in commercial aviation. However, CFM will apply the agreement to all commercial engines produced by the company, including engines in its new LEAP Series.
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Boeing has announced plans to open the new Boeing Aerospace & Autonomy Center in Cambridge, Mass., becoming the first major tenant of the Massachusetts Institute of Technology's (MIT) new mixed-use district in Kendall Square.
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Under the agreement, Boeing will lease 100,000 ft² of research and lab space inside a new 17-floor building at 314 Main Street in Cambridge. The new center will house employees from Boeing and subsidiary Aurora Flight Sciences, who will focus on designing, building and flying autonomous aircraft and developing enabling technologies.
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The investment in the new center follows the recent creation of Boeing NeXt. This new organization unites researchers and projects across the company to shape the future of travel and transport, including the development of a next-generation airspace management system to enable the safe coexistence of piloted and autonomous vehicles. Employees at the center will help develop new technologies in support of Boeing NeXt programs.
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The construction of the new research facility is part of MIT's broad strategy to foster vibrancy and diversity in Kendall Square, which is often referred to as the most innovative square mile in the world. Through its Kendall Square Initiative, the university will develop six buildings to house a blend of lab and research, office, housing and retail space.
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MTU Turbomeca Rolls-Royce ITP GmbH (known as MTRI), jointly with its partners MTU Aero Engines, Safran Helicopter Engines, Rolls-Royce and ITP Aero, approved AIA Bordeaux (Atelier Industriel de L’Aéronautique de Bordeaux) as the first MTR390-Enhanced MRO shop.
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At the facility in France, all variants of the MTR390 family of engines, which power the Tiger combat helicopter, will be maintained in the future, especially so the propulsion systems operated by the French Armed Forces. As of now, the first helicopters powered by MTR390-E engines, too, can be repaired and overhauled on site. Back in January this year, MTRI already awarded AIA Bordeaux the certificate as an approved shop for Line Replaceable Units (LRUs). The facility overhauls these LRUs on site for all participating nations. Approval of yet another MTR390 MRO shop, based in Spain’s Albacete, is scheduled for April 2019. In both instances, MTU takes care of the project management.
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Following a four-year project phase for setting up the two service centers in Bordeaux and Albacete, the first, French facility obtained approval even four months ahead of schedule last week, thanks to a dedicated team effort of all MTRI partners involved in the procurement of the infrastructure and of the materials, to the ambitious schedule planning for employee training, and a fast closure of audit findings and of the qualification and validation of the standard processes. From now on, the shop has the capability to provide the whole range of services for the entire engine.
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Air New Zealand Chairman Tony Carter will retire at the airline's Annual Shareholders' Meeting in September next year and be replaced by current Director Dame Therese Walsh. Mr Carter has held the role of Chairman at the airline since 2013 after joining the Board in 2010.
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Mr Carter signalled to the Board last year that 2019 was likely to be his final year at the helm of the national carrier and by making this decision now allows fellow Directors the time to adequately plan for his succession.
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Dame Therese is currently Chairman of TVNZ, a Director of ASB and Contact Energy and a previous Director of the NZX. She is also a Trustee of Wellington Regional Stadium, a Board member of Antarctica New Zealand and Pro Chancellor at Victoria University. Her appointment as Chairman of Air New Zealand will coincide with the conclusion of her tenure as Chairman of TVNZ.
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Bombardier Commercial Aircraft has released that its 90-passenger Q400 aircraft configuration has received its certification from Transport Canada, becoming the first in-production commercial turboprop to reach that capacity.
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“With increasing growth in the number of passengers per departure in the turboprop market, we are excited to offer our customers a higher-capacity configuration and 15% lower cost per seat compared to the previous standard Q400, leading to more profitability potential for airlines,” said Todd Young, Head of the Q Series Aircraft Program, Bombardier Commercial Aircraft. “This milestone certification showcases the unique versatility of the Q400 turboprop and our continued commitment to the evolution of the program.
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“Upon delivery later this year, our launch customer SpiceJet will become the first airline to take advantage of the profitable and efficient operations of the 90-seat Q400 aircraft following its order of up to 50 in 2017,” added Mr. Young.
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Combined with the Q400 aircraft’s unique speed flexibility, which is driving higher scheduling efficiency, this new segment solution is perfectly adapted to high-demand turboprop markets and will further enhance economic connectivity between smaller towns and major hubs.
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For the first time, American Airlines — together with its Pacific Joint Business partner Japan Airlines (JAL), is announcing a special nonstop flight between Narita International Airport in Tokyo (NRT) and McCarran International Airport in Las Vegas (LAS) to support additional demand for CES 2019. American will operate the flight Jan. 4–14, 2019.
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This special service will be flown on American’s Boeing 787-8 and will be marketed by Japan Airlines. For the 10-day period, American’s service between NRT and Chicago O’Hare International Airport (ORD) will operate through LAS. JAL will continue to offer nonstop service between NRT and ORD during the same period.
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Delta has reported total system traffic increased 4% in July 2018, while capacity was up 3.5% compared to the same period in 2017. Total system load factor for July improved 0.5 points to 88.6% compared to the previous year.
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Helping business jet operators and aircraft owners save a significant amount of money on their mainstay purchases through group purchasing has convinced business aviation professional Matt Smith to commit to a new role – as Vice President of Business Development.
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Used to a high-pressure environment, having working globally in a senior sales role with Air Charter Service Plc, Matt takes responsibility for AVIAÂ’s growing membership, based out of Irvine, California, USA.
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Taking responsibility for a small team bringing new members into the business, Matthew monitors trends, new markets, and new disruptors to help identify suppliers, working closely with Director of Supply Chain Services, Miles Bailey.
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During the second quarter, Bombardier Business Aircraft revenues totalled US$1.3 billion on 34 deliveries, with aftermarket revenue growing 21%, offset by lower aircraft revenues from fewer pre-owned aircraft available. On a year-to-date basis, revenues total US$2.4 billion, on track to the US$5 billion guidance for the full year. Year to date, deliveries reached 65 aircraft, in line with plan and last year, tracking to full year guidance of 135 aircraft deliveries. Margins continued to trend above the greater than 8% guidance, with EBIT margin before special items reaching 8.5% and 8.7% for the three- and six-month periods ended June 30, 2018, respectively. Aircraft backlog at the end of the second quarter increased to $14.1 billion, reflecting strong market activity for the third consecutive quarter. Demand continues to be fuelled by North America while Asia Pacific, Greater China and Europe are exhibiting good momentum.
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During the quarter Bombardier Commercial Aircraft delivered 18 aircraft, consisting of 8 C Series, 5 CRJ Series and 5 Q400 aircraft. With year to date deliveries of turboprops and regional jets totalling 18, Commercial Aircraft is on track to meet annual guidance of 35 deliveries for the regional aircraft platforms. With year-to-date revenues of US$1.1 billion and EBIT loss before special items of US$139 million, Bombardier is reintroducing Commercial Aircraft’s full year revenue guidance of approximately US$1.7 billion and EBIT loss before special items guidance of approximately US$250 million. This reflects the deconsolidation of CSALP from Commercial Aircraft’s results starting in the third quarter, replaced by the equity pick-up. The second quarter saw significant order activity with a book-to-bill ratio of 4.2. The CRJ Series backlog grew to 60 aircraft, with two CRJ900 aircraft orders totalling 35 aircraft from American Airlines and Delta. These orders are the first with the new ATMOSPHÈRE cabin, setting the new standard of passenger experience in the regional jet market segment. Other orders included 16 Q400 aircraft from Ethiopian Airlines and African Aero Trading bringing the backlog to 56 aircraft.
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