MTU Aero Engines AG generated revenue of €3.1 billion in the first half of 2023 recording an increase of 25% over last year. The company reported an operating profit of €405 million reporting a 40% increase from €290 million operating profit last year while the net income is €300 million, up from €207 million in the same time last year.
“Flight activity and the order situation are underlining the recovery in our industry. Against this back-drop and in view of our figures for the first half of the year, we believe that we are on track to reaching the targets we have set ourselves for 2023,” said Lars Wagner, chief executive, MTU Aero Engines AG. “We are confirming our full-year guidance today.”
MTU had raised its earnings forecast in mid-June and confirmed its revenue guidance for 2023.
The company posted higher revenue in all business segments in the first half of 2023.
The company recorded highest revenue growth in commercial engine business, where revenue increased by 40% to €832 million. The main revenue driver was the PW1100G-JM engine for the A320neo.
“Our spare parts business expanded across all platforms – particularly widebody engines and industrial turbines. The Geared Turbofan™ engines, the GEnx, engines for business jets and industrial gas turbines generated growth in series business,” added Peter Kameritsch, chief financial officer.
Revenue from commercial maintenance rose by 22% from €1.7 billion to €2.1 billion in the first half of 2023. The main revenue drivers were the PW1100G-JM and the V2500 for the classic A320 aircraft family.
“Growth was particularly underpinned by maintenance for Geared Turbofan engines. This reflects the further ramp-up of GTF-MRO activities at MTU Maintenance Zhuhai in China and EME Aero in Poland. Impetus also came from maintenance for engines for long-haul and cargo aircraft, industrial gas turbines and our leasing business.” added Kameritsch.
“Together with our partners, we will be doing our utmost to manage this situation efficiently and to limit the impact on our customers as far as possible. I also want to stress that this is not an engine design problem. It does not affect the production of new engines and spare parts,” commented Wagner.
The company announced a new inspection program for Geared Turbofan engines, which will be commencing in September and initially concern 200 engines.
The order backlog was valued at €21.9 billion at the end of the first half. The majority of orders were for the V2500 and the Geared Turbofan engines of the PW1000G family, especially the PW1100G-JM.
“The consistently good order situation is also reflected in our successes at the Paris Air Show,” added Wagner. MTU received orders worth more than half a billion dollars at the Air Show held in mid-June.
The company recorded free cash flow at €135 million in the first six months, compared with €168 million in the prior-year period. “The Geared Turbofan inspection program will cause headwinds for our free cash flow,” said Kameritsch. “We will resolutely enhance our strict cash management to limit the impact as far as possible.”
Confirming its full-year guidance for 2023, the company set the revenue target for €6.1 to 6.3 billion. MTU anticipates organic revenue from commercial series business should expand by around 30% on a dollar basis.