Record year for CFM International lifts Safran

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A record year for its CFM International civil engines joint venture with GE helped Safran's aerospace propulsion division notch up a 9% increase in sales to €6.1 billion ($8.1 billion) in 2011, with operating profit jumping 37% to €909 million.

CFM doubled its previous best year with a record $52 billion in orders and commitments at list price for 1,500 CFM56 and 3,056 Leap engines, taking total CFM56 and Leap orders and commitments to more than 9,400 units, or about seven years of production. For the year, service accounted for just short of half of propulsion division revenue; CFM spare parts revenue was up 8% and the estimated number of shop visits for CFM-equipped civil aircraft increased to 2,329 as compared to 2,131 in full-year 2010.

Higher R&D expenses, primarily against development work for the Leap engines, had an impact on profitability, but Safran was able to make an impairment reversal of €23 million related to the A380 engine programme.

In aircraft equipment division, sales rose 9% to €3.1 billion while operating profit soared 59% to €2.2 million, owing largely to double-digit growth in the nacelle and wheels and brakes businesses. Nacelle activity was up significantly in small nacelles - deliveries grew 37% - and also higher deliveries for Airbus A380s - 104 units in 2011 versus just 74 nacelles in 2010.

For the group, sales were up 9.1% to €11.7 billion and operating profit rose 35% to €1.2 billion, with pre-tax profit standing at €695 million.

Safran expects 2012 to remain characterised by an "unstable environment" but anticipates "further solid earnings growth" and revenue growth of about 10%, to nearly €12.9 billion.

Safran hired 6,000 people in 2011 and plans to do the same again this year, including some 3,000 in France.