FACC Anticipates Renewed Growth For 2022
SALZBURG, Austria—The head of Austrian aerospace supplier FACC said that after the challenges of 2020 following the onset of the COVID-19 pandemic, the aerospace market is now stabilizing.
FACC CEO Robert Machtlinger said the second half of 2021 is so far showing positive signs for the industry and his company anticipates renewed growth from 2022.
The supplier, which is 55.5%-owned by Chinese state aerospace group AVIC, generates 32% of its revenues from the Airbus A320 family aircraft. That also happens to be the program that Machtlinger expects to have the fastest recovery in production, relative to the others FACC supplies to.
Planned new projects, such as urban mobility or space applications, should provide an additional boost. “Widebody aircraft production remains at slower but stable rates,” he added.
Machtlinger said that of the 22,460 aircraft in-service worldwide before the COVID-19 pandemic, 9,000 were not in service in December 2020 and today the number stands at minus 5,000 aircraft.
Commenting on FACC’s first-half (H1) results on Aug. 18, Machtlinger said that by reacting quickly and focusing on the changed conditions during the pandemic, FACC could position for the industry recovery. With the implemented measures, the supplier achieved an EBIT turnaround of €37.3 million ($44 million), posting EBIT of €2.9 million for H1. Consolidated revenues for the second quarter (Q2) of 2021 were 20.8% higher than its Q2 2020 revenues.
“We are on a solid course, having adjusted all cost structures accordingly and are pursuing the goal of further expanding our market shares in all business areas,” Machtlinger said.
Talking about the slight upswing, the CEO noted regional differences. Of FACC’s key markets, continental air traffic came back first in China followed by the U.S. and lastly in Europe, which has developed positively in recent months.
“In addition to the necessary adjustments in the core aerospace business, we have expanded our strategy to include drones and space applications,” Machtlinger said. “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.”
FACC expects customer call-offs to remain stable and predictable in the coming months and beyond.
Based on current developments, management still expects a turnover of around €500 million for fiscal 2021, while EBIT should be slightly positive for the year as a whole.
Pre-COVID market levels in 2019 should be reached again in 2025, with annual growth of 4% after that, the company said.
FACC’s most prominent customers are Airbus, Boeing, Bombardier, Collins, COMAC, Embraer, Pratt & Whitney and Rolls-Royce.