Half Year 2026 Safran SA Earnings Call Transcript
Key Points
- Safran SA (SAFRF) reported a 20% organic revenue increase, reaching EUR17.6 billion, with a 29% rise in recurring operating income to EUR3.2 billion.
- The company delivered 1,030 LEAP engines in the first half, marking a 41% year-on-year increase, and maintained strong aftermarket demand for civil engines.
- Free cash flow increased by 43% to EUR2.6 billion, demonstrating strong cash generation and financial performance.
- Safran SA (SAFRF) raised its full-year guidance, reflecting confidence in continued strong performance across its business segments.
- The company is expanding its global footprint with new facilities in Mexico and Singapore, enhancing its maintenance and production capabilities.
- The ongoing Middle East crisis and currency volatility posed challenges, although they were managed effectively.
- Despite strong performance, the company faces potential headwinds from increased material costs and geopolitical uncertainties.
- The French corporate surtax impacted the reported tax rate, increasing the effective tax burden on the company.
- Supply chain challenges affected helicopter turbine original equipment (OE) deliveries, indicating ongoing operational hurdles.
- The Aircraft Interiors segment, while improving, still faces challenges in achieving higher margins and cash flow positivity.
Welcome to the Safran half-year 2026 results. At this time, I would like to turn the conference over to your host, Mr. Olivier Andriès, Safran CEO; and Pascal Bantegnie, Group CFO.
Mr. Andriès, please go ahead.
¨ -
Good morning, everyone, and thank you for being with us today. So Q2 continued on the strong trends observed in Q1, resulting in an exceptional first half marked by a stellar demand in the civil engine aftermarket, a strong ramp-up in LEAP and M88 engine deliveries, and record financial performance. The Middle East conflict barely impacted our performance, civil aftermarket activity remaining well above our pre-conflict forecast. Spare parts sales for civil engines increased by 28% in dollar value, and civil engine services also grew by more than 40%, all of this despite the geopolitical context in the Middle East.
CFM56 continued to drive spare parts performance with a fleet benefiting from a low level of retirement, combined with a very strong demand
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