Solid aircraft delivery figures for March propelled Airbus shares higher as investors bet on a fledgling recovery in the pandemic-hit aviation sector and set sights on the company’s bulging order book.
Airbus said airline customers took delivery of 72 planes last month, twice as many as in March of last year when lockdowns from the COVID-19 outbreak brought air travel to a near standstill. The surge offset a weak start to 2021 and brought the quarterly figure into the green with 125 deliveries versus 122 in the first quarter of 2020.
Deliveries to European carriers were comparatively few in March, however, with the bulk going to American and Asian competitors. Four out of the eight A330 and A350 wide-bodies delivered last month went to Singapore Airlines and Cathay Pacific.
“In our view [this] makes sense given the strong recovery that continues to be seen in these regions,” Bank of America Merrill Lynch said in a research note, reiterating its “buy” rating and 128-euro price target.
“The size and breadth of the backlog continues to support deliveries,” it added.
Shares in Airbus were up 0.4%, at 101.24 euros, off a day-high of 104.06 euros.
Right now, Airbus can rely on its prodigious order book to keep its factories humming. Its backlog stood at 7,184 planes at the end of last year, which, the company says, equates to roughly nine years of production.
This healthy cushion offers the company greater certainty in planning, given that it received only 39 new orders in the first quarter. These were more than offset by 98 cancellations of narrow-body planes as well as two wide-body aircraft, mainly owing to the collapse of Norwegian Air.
Last year’s pandemic brought a screeching reversal in the long-term output trend at Airbus. With 863 planes delivered in 2019, the company, based in Toulouse, France, had just notched its 17th straight year of production gains, including a record 173 wide-body aircraft led by the A350 family.
Recent flight data points to tentative improvement in Europe, suggesting green shoots in a region beset by lockdowns and slow vaccination rates, according to Bank of America Merrill Lynch.
Last month, Lufthansa reported it would offer around 1,200 European flights from March to April, roughly tripling the connections from Munich and increasing the figure from Frankfurt by roughly 50%.
It cited particularly strong demand for Spanish resorts, deciding to fly to almost all of the Canary Islands for the first time since the depths of the pandemic and dramatically boosting capacity for holiday favorite, Majorca.
Airbus rival Boeing has yet to publish results for March, but it has also recorded a rebound, with 48 planes handed over to civilian and military customers in the first two months of this year, up from 30 in the corresponding period in 2020.
A spokesperson for the U.S. Aerospace company said it would publish its March data on April 13.