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GE's aviation profits surge as Leap deliveries accelerate

General Electric's aviation division posted significant third quarter gains in revenue and profit amid a continued acceleration in deliveries of CFM International Leap turbofans.

The Boston-based company handed over 303 Leap engines in the third quarter, up from 250 in the second quarter, GE reports on 30 October.

The company is sticking to its projection of delivering 1,100 to 1,200 Leap powerplants for the full-year of 2018.

The GE aviation unit's third quarter profit soared 25% year-over-year to $1.7 billion.

The results reflect a 12% jump in aviation revenue, to $7.5 billion. That amount includes $5.6 billion in revenue from sales and service of commercial aircraft engines, a 17% one-year gain.

The aviation division received orders worth $9.1 billion in the third quarter, up 35%. Those orders included $4.1 billion in equipment orders and $5.1 billion in orders for services, GE says.

"We continue to see real underlying strength in the aviation unit," GE chief financial officer Jamie Miller says during the company's earnings call. She notes global passenger air travel has jumped 6.8% this year, meaning more demand for engines.

"Our engines are just flying more," she says. "Which means we bill more hours under services contract, we consume more parts as they go into maintenance."

Miller says GE's production of Leap engines, which power Boeing 737 Max and Airbus A320neo family aircraft, remains about four weeks behind schedule.

But she insists the company remains "committed" to its 1,100-1,200 Leap delivery goal for 2018.

CFM International, which GE and French company Safran Aircraft Engines own jointly, has delivered 739 Leap turbofans so far in 2018, meaning it must deliver another 361 of the engines before year-end to meet the goal.

CFM delivery delays have radiated outward, with Boeing executives citing CFM for contributing to troubles ramping 737 production.

Leap engine issues appeared last year when Boeing grounded its 737 Max test fleet to address turbine disk issues. CFM also found problems with coatings on Leap ceramic matrix composite parts, as well as suffered from broader supply chain shortages.

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