FACC, a supplier of aviation systems including aircraft cabin hardware, has posted its results for the first quarter of 2023, showing revenues of €162.7 million (US$177.4 million) – an increase of 27.6% compared to Q1 2022. FACC says that the ongoing recovery of air traffic led to this significant revenue increase in the first quarter, through the market environment is still affected by disruptions in international supply chains and inflation issues. This is also reflected in the operating result at the end of the first quarter of 2023.
The company expects issues with international supply chains to ease during 2023 though, as is customary in the industry, inflation-driven cost increases will be passed on to the market with a time lag of up to one year.
With regard to aircraft orders and deliveries, FACC is benefiting from the high demand for new aircraft. With regard to passenger levels, with the exception of China, passenger numbers on short- and medium-haul flights (continental travel) have returned to pre-pandemic levels.
‘This growth trend is set to continue, and passenger numbers are also on the rise again in China following the relaxation of the strict Covid rules. Only international travel has not returned to its pre-crisis level. The prediction made by FACC’s management in 2020, according to which the aviation industry will fully recover by the end of 2024, has proved to be accurate’, read FACC’s financial report.
Growth, research and expansion of workforce
The main priority at FACC is to further increase revenues in its core business and to expand its manufacturing capacities. In the financial year 2023, approximately EUR 34.8 million is planned to be invested in FACC’s growth. This includes tripling the area of the FACC plant in Croatia, which went into operation in 2022. FACC is also conducting research into technologies and materials that are set to make a significant contribution to achieving carbon-free mobility in the aviation industry. This includes, in particular, the establishment of a sustainable materials cycle management; FACC says its lightweight construction and product solutions will play a role in meeting the aviation industry’s goal of carbon-neutral flying.
The company’s personnel expansion, which was initiated in 2022 with the onboarding of around 400 new colleagues, will continue. Within the next 14 months, the workforce is due to be further expanded by 400-600 employees throughout the company due to what it calls the ongoing ‘excellent demand situation’.
Outlook
For the year as a whole, the management of FACC AG continues to expect an increase in revenue in the high single-digit percentage range, as well as a gradual improvement in earnings.
