Finmeccanica looks to be rising strongly out of a five-year slump, with 2014 figures showing its first positive net result since 2010 and a strong performance in its aerospace and defence core.
Coming just weeks after Hitachi agreed to buy Finmeccanica’s last major non-core business, the AnsaldoBreda rail rolling stock company, the €70 million ($75 million) profit before exceptionals marks a turnaround of more than €700 million from the €649 million loss chalked up in 2013.
The €810 million Hitachi deal will complete the AgustaWestland and Alenia Aeronautica parent’s long-running plan to sell off troubled bus, rail and energy businesses, and cut a burdensome €4 billion corporate debt by €600 million, but for chief executive Mauro Moretti the shining figures are in the core businesses that are the company’s future. There, profit (EBITA) rose nearly a quarter to €833 million on sales up by nearly 10% to €11.1 billion.
AgustaWestland
Moretti, appointed last year by then new Italian prime minister Matteo Renzi in a sweep of management at state-controlled firms, told analysts that “change is already happening” and vowed to be “fully committed and personally involved” in what he called a “radical mission change”. Underscoring the significance of a strategy outlined in January, Moretti said Finmeccanica’s change from being a financial holding company overseeing semi-independent businesses to a focused aerospace and defence group is well under way – and execution is now the top priority.
This strategic plan to improve management and focus on aerospace was outlined by then chief Giuseppe Orsi following a disastrous 2011 that saw a net loss of more than €2.3 billion on heavy losses in power, road and rail and a €750 million write-down against defects in fuselage sections and horizontal stabilisers supplied to theBoeing 787.
Subsequent woes included allegations that AgustaWestland paid to win a lucrative VVIP helicopters sale to India. The scandal cost Orsi his job, although he was later found not responsible.
Today, however, AgustaWestland is on a roll, accounting for half of group profit; the AW189 achieved certification in 2014 and AW169 certification is expected soon. And although Moretti said 787 structures work that earned Finmeccanica €300 million last year still has to “be faster”, output has been rising.
Volume improvements are also being achieved in the Eurofighter, F-35 and M-346 trainer programmes, as well as at ATR, Finmeccanica’s regional turboprops joint venture with Airbus.
Source: FlightGlobal.com
