BA Boeing Co

- Airbus swung to a loss in 2019 on the back of penalties and A400M charges

- The carrier expects to deliver approximately 880 aircraft in 2020, compared with 863 handed over last year

- Airbus is considering a potential production increase of its A320 family jets, while it cut the production rate of its widebody A330

By Olivia Bugault

Airbus said Thursday that it swung to a loss in 2019 on the back of penalties related to a corruptuion probe, while it expects jet deliveries to increase to roughly 880 jets in 2020.

Airbus said its full-year net loss was 1.36 billion euros ($1.48 billion) compared with a net profit of EUR3.05 billion in 2018.

"The reported earnings also reflect the final agreements with the authorities resolving the compliance investigations and a charge related to revised export assumptions for the A400M," Chief Executive Guillaume Faury said.

The company was hit by EUR3.6 billion in penalties related to a corruption-probe settlement and also booked charges of EUR1.2 billion from its A400M military transport aircraft program, Airbus said.

Sales rose 11% at EUR70.48 billion.

However, Airbus's more closely watched adjusted earnings before interest and taxes rose 19% to EUR6.95 billion from EUR5.84 billion. For its fourth quarter, adjusted EBIT came in at EUR2.81 billion.

The Toulouse, France-based company said deliveries would rise in 2020, with a guidance of roughly 880 planes handed over this year after delivering 863 in 2019. Airbus overtook Boeing Co. last year as the world's largest aircraft manufacturer as the U.S. company is still embroiled is the worst crisis in its history, involving the grounding of its best-selling 737 MAX plane following two crashes. Boeing posted a 2019 loss of $636 million, its worst financial performance in two decades, as the crisis derailed its strategy and cost over $19 billion.

The European aerospace giant expects an adjusted EBIT of roughly EUR7.5 billion this year. Free cash flow before merger & acquisition and customer financing should come at roughly EUR4 billion before the EUR3.6 billion penalty payments and "a negative mid-to-high triple digit million euro amount for the consumption of compliance-related provisions for tax and legal disputes," Airbus said.

The plane maker said it is considering increasing production of its A320 planes beyond 63 a month as demand for the jets is strong. On the other hand, it said that it cut production of its A330 aircraft to 40 in 2020 on the back of weaker demand for widebodies aircraft.

Airbus said that the coronavirus should not disrupt air travel in 2020 and sees no other major disruptions this year.

Airbus will propose a dividend of EUR1.80 a share for 2019, up 9% compared with last year.

Write to Olivia Bugault at olivia.bugault@wsj.com

(END) Dow Jones Newswires

February 13, 2020 02:59 ET (07:59 GMT)

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