2020 was a challenging year for the aerospace sector, but according to aircraft interiors supplier, FACC AG, the market is now showing signs of stability. The Austria-based company achieved a half-year EBIT (earnings before interest and taxes) of €2.9 million (US£3.4m), an increase of €37.3 million (US$43.7m) compared to its figures for the first half of 2020, which FACC attributes to its effective response the changed framework conditions created during the pandemic.
FACC also posted half-year revenues of €240.2 million (US$281.6m) for 2021, which it says are “on target and reflect the market recovery”. Consolidated revenues for Q2 2021 were 20.8% higher than those of Q2 2020.
In its report the company identifies an “upswing” in the aerospace industry, albeit with regional differences. “Continental air traffic in the key markets of China, the USA and ultimately also in Europe has developed positively in recent months,” states the report. “The desire for air travel is increasing – and so is the demand. As expected, intercontinental travel is recovering more slowly due to different quarantine requirements across the continents.”
Robert Machtlinger, CEO of FACC AG is bullish about the company’s recovery strategy: “Our goal was the turnaround, and we have successfully achieved it. FACC responded quickly to the sudden challenges with a stringent efficiency enhancement programme. In addition to the necessary adjustments in the core aerospace business, we have expanded our strategy to include drones and space applications… We are on a solid course, have adjusted all cost structures accordingly, and are pursuing the goal of further expanding our market shares in all business areas.”
On the broader market, Machtlinger stated, “We are noticing a steady recovery in the aerospace market after the first six months, and the forecasts for 2022 also promise a further increase in demand.”
Outlook
FACC reports that the second half of 2021 is showing a “continued positive development in the industry”, with customer call-offs expected to remain stable and predictable in the coming months and beyond. Based on current developments, the management board anticipates a turnover of around €500 million (US$586m) for the full year 2021. Due to the earnings development in the first half of the year and the consistent implementation of cost-cutting measures, the board expects EBIT to be “slightly positive” for the year as a whole.
For 2022, the company anticipates renewed growth, with key programmes standing to benefit from developments in the market. For example, FACC says the Airbus A320 family – FACC’s most important aircraft platform, with a share in group sales of more than 30% – is performing “particularly positively”.
Planned new projects will provide an additional boost for FACC AG. “Based on the current developments, we anticipate a return to our growth path from 2022 onwards,” added Machtlinger.