Eurocopter Sees Growth in Services, Emerging Countries

HAI Convention News » 2013
The EC120, left, and the EC175 are two Eurocopter models which have seen improved sales in 2012. The manufacturer has also seen growth in the services sector.
The EC120, left, and the EC175 are two Eurocopter models which have seen improved sales in 2012. The manufacturer has also seen growth in the services sector.
March 4, 2013, 12:30 PM

Eurocopter released financial results for 2012 last month, logging another year of growth despite continuously eroding deliveries. Services, such as maintenance and training, are set to become Eurocopter’s number-one revenue producing activity, surpassing helicopter production. And during the next five years, the European manufacturer is betting on growth in emerging countries.

Revenues in 2012 were up by 15 percent, at €6.3 billion ($8.4 billion). “This is the second year in a row with a double-digit growth,” said CEO Lutz Bertling. Eurocopter’s civil business accounted for 54 percent of the turnover. Deliveries dropped to 475 units, the lowest point since 2007 and short of the previously predicted “500-plus” units. Bertling said this is a consequence of the dip in orders in 2008 and 2009. Based on deliveries, Eurocopter still claims a 44-percent market share. This is for a 750-unit market, including civil and parapublic rotorcraft above 2,200 pounds (one metric ton).

In terms of orders, 2012 marked an improvement, at €5.4 billion ($7 billion). Helicopter bookings totaled 469 units. Five model families–EC120, Ecureuil/AStar/EC130, EC135, EC175 and Super Puma/EC225, as well as their military counterparts–saw improved sales. EC145 sales dropped because of a planned reduction in the U.S. Army’s Lakota orders, Bertling explained. EC155/Dauphin sales decreased, too.

Thanks to the healthy order book, deliveries should increase by 15 percent this year. “It would be great if the order intake could increase by a double-digit percentage as well,” Bertling said. Revenues are expected to continue rising, “close to our average growth of 8.7 percent,” he added. Explaining the 2012 contrast between revenue growth and delivery dip, Bertling mentioned two factors. One is a better mix in favor of heavier (thus pricier) helicopters. The other factor is the expanding service activity, which, in value, is close to the production activity. “Services are a downturn-resilient business,” Bertling said. In bookings, services surpassed production last year.

The growth in services is largely due to the acquisition of helicopter maintenance specialist Vector Aerospace in 2011. Last year was the first year of full consolidation of Vector’s results into Eurocopter’s. The parent company will leave some autonomy with Vector. “This is a speedboat, we don’t want to make it part of a tanker,” Bertling said.

Five new full flight simulators were added worldwide last year, including the first in China and the first in Africa, bringing the total to 20. “This is a low-margin business,” Bertling said. He sees training as a way to improve safety, which in turn improves mission capability and helicopter acceptability. Last year, the accident rate of the Eurocopter fleet was cut by 30 percent, Bertling claimed.

The company reported it had planned to hire 1,700 people last year as a result of growth in revenues and orders. Eurocopter currently has 22,000 employees; one third of them work outside France and Germany, the countries where the firm was born in 1992.

Over the next five years, growth is expected to come primarily from three regions: Asia, Latin America and Eastern Europe. In 2017, Asia will offer the biggest potential market in units, according to Bertling. The long-awaited opening of the lower airspace in China is still at the experimental stage, he noted. “Maybe it is due to the military’s reservations. but the Chinese may also be waiting for [national company] Avicopter to be able to better serve the market,” he suggested.

Bertling is adamant that Eurocopter subsidiary Helibras in Brazil will one day be a full-fledged helicopter company with design capability. So far, Helibras has maintained and manufactured some Eurocopter models, the latest being the EC725 Cougar. The next could be the civil variant, the EC225. Locally produced helicopters are favored in tenders issued by national companies such as Petrobras.

FILED UNDER: 
Share this...

Please Register

In order to leave comments you will now need to be a registered user. This change in policy is to protect our site from an increased number of spam comments. Additionally, in the near future you will be able to better manage your AIN subscriptions via this registration system. If you already have an account, click here to log in. Otherwise, click here to register.

 
X