Airbus parent reports higher Q3 profit

AIRBUS parent company EADS says strong demand for its commercial aircraft has helped its third-quarter profits increase by a hefty 45 per cent.

But the European jet-maker warned on Thursday that its free cash flow, a measure of cash generated by a business, would be negative 1.5 billion euros ($A2.18 billion) this year because of its investment program into lifting production and development of programs such as the A350 long-range wide body, which is supposed to enter service in the second half of next year.

Previously, the company had said its free cash flow would break even this year, compared with positive 1.5 billion euros last year.

EADS said in a statement net profit for the July-September quarter rose to 436 million euros, up from 301 million euros a year earlier.

EADS, which next year is adopting the "Airbus" name for its overall corporate identity, said its free cash flow is being squeezed as some of its government military customers cut spending amid tightened budgets, as well as unexpected additional costs tied to the A350 and other programs.

Speaking to reporters on Thursday, EADS chief financial officer Harold Wilhelm said "there's still a long way to go" on the A350 with some higher costs, but that the program remains on track for entry into service late next year.

Wilhelm also said the free cash flow situation will improve before the end of this year.

EADS still expects its operating profit before one-offs, its preferred earnings gauge, to reach 3.5 billion euros this year, up from 3 billion euros in 2012.

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