MTU raises forecast after bright first half, names new CEO

MTU Aero Engines has raised its full-year earnings forecast after improved interim profits and has named the chief of transport technology firm ZF Lenksysteme, Egon Behle, as successor to MTU chief Udo Stark.

The Munich-based aero engine manufacturer has today revealed an 8% rise in first-half revenues to €1.26 billion ($1.74 billion), driven y 11% growth in its OEM business. The group’s commercial engine OEM activity enjoyed revenue growth of 12% to €545 million. MTU’s commercial MRO revenues were up 3% in the first half to €505 million.

First-half adjusted EBITDA increased nearly a quarter to €181 million, reflecting a 38% jump in profitability of its OEM business which contributed an adjusted EBITDA of €125.8 million. Adjusted group net income was also up nearly 10% in the first half to €61 million.

Stark says: “We expect our year-end results for 2007 to reflect this continued growth trend, with significant contributions from the series production of commercial engines and spare part sales, which are progressing well.

“This upward trend is underpinned by the sustained impact of our efficiency improvement program. This has enabled us to raise our earnings forecast for the current financial year.”

MTU has raised its full-year adjusted EBITDA forecast by €20 million to €385 million – which compares with the €318 million recorded in 2006. Similarly it has raised its full-year adjusted net profit forecast by €10 million to €150 million.

It comes as MTU has named Behle as successor to Stark who, as previously announced, has opted not to renew his contract when it expires at the year-end. Behle has served as CEO of vehicle technology firm ZF Lenksysteme, a joint venture between Bosch and ZF Friedrichschafen, since 2002. He will take up his new role as CEO of MTU Aero Engines at the start of next year.