Europe’s Airbus bowed to investor pressure to return some cash with a special dividend and talked up jetliner production and design plans, despite a fresh charge of 200 million euros ($215 million) at its troubled Space business.

The world’s largest commercial planemaker said core adjusted operating profit rose 4% to 5.8 billion euros in 2023 as revenue climbed 11% to 65.4 billion, and predicted core profit of 6.5 billion to 7.0 billion euros this year.

For the fourth quarter, adjusted earnings came in just below market forecasts compiled by the company at 2.21 billion euros.

Airbus is riding a wave of orders from airlines coping with a rebound in travel demand from the pandemic, helping it to build up cash reserves in contrast with US rival Boeing which is mired in debts stemming from a series of crises.

Airbus proposed an unchanged regular dividend of 1.8 euros a share, and added a special dividend of 1 euro per share as net cash topped the 10-billion-euro threshold previously identified as a potential trigger for returning more cash to shareholders.

Shares fell around 1%, however, with some analysts pointing to cautious financial forecasts for 2024 and a lack of fresh updates on a broader share buyback.

Investors have been pushing Airbus for a buyback as the company’s strong lead over Boeing at the top end of the busy single-aisle jet market generates cash from airline deposits.

Chief Financial Officer Thomas Toepfer said Airbus had chosen the special dividend to act quickly and to signal that it was sticking to its pledges on distributing cash.

Airbus forecast around 800 jet deliveries for 2024 but announced a further delay in entry to service of its A321XLR single-aisle jet to the third quarter from the second.

CEO Guillaume Faury said Airbus was “on our plan” to reach a key production target of 75 single-aisle jets a month in 2026 and that he remained confident in the goal, which is central to Airbus’ industrial plans in the busiest part of the market.

Some suppliers remain more conservative, however, telling Reuters that Airbus is producing around 50 of the jets a month compared to a production plan that had foreseen 58 by end-2023.

Faury said that once it reaches 75 a month, Airbus will stay there “for a while” - comments apparently designed to reassure suppliers who have been worried about investing in new capacity for fear that Airbus factories will slow down again.

Faury also gave extra details on an eventual successor to the best-selling narrow-body A320neo family and reiterated it would enter service in the second half of next decade.

He told Aviation Week last June that this roadmap would involve launching a new plane between 2027 and 2030.

Given long lead times, plane and engine makers have long been working towards a mid- to late-2030s target for new medium-haul planes but Airbus has begun discussing the early groundwork more publicly as Boeing wrestles with its troubled 737 MAX.

Neither planemaker is anxious to disrupt the status quo of their powerful duopoly too quickly, however, and engine makers need until around 2035 to perfect new models, analysts say.

Faury said the next narrow-body plane would be 100% powered by Sustainable Aviation Fuel but acknowledged this would involve a massive increase from just 1% in use today.

A smaller regional plane project dubbed ZeroE is targeted for 2035 using hydrogen technology.

“We are defining the positioning of that plane in the years to come before we launch that programme,” Faury said.

The Space unit charge brings the total written off in that segment last year to 600 million euros and comes a day after Reuters reported that Faury had told staff that large, unexpected charges in the business were “not acceptable”.

Airbus is among European companies facing fierce competition from a new generation of low-cost satellites. Airbus confirmed that its delayed OneSat family of telecom satellites was involved in the writedowns.

Meanwhile,  The Indian government on Friday gave initial approval for the purchase of 15 maritime patrol aircraft from Airbus and six air-refuel aircraft, officials said.

The defence acquisition council, the top Defence Ministry body for arms acquisition, approved projects worth 845.6 billion rupees ($10.19 billion) for the country’s armed forces and coast guard, the government said in a statement.

Initial approval, called Acceptance of Necessity (AoN), was given for Medium Range Maritime Reconnaissance and Multi-Mission Aircraft for the navy and the coast guard.

The statement did not give further details but two defence officials aware of the matter confirmed that it referred to the maritime surveillance version of the C-295 aircraft made by Airbus, and they will be manufactured in Spain and in India.

The defence acquisition council also approved purchase of flight refueller aircraft for “enhancing the operational capabilities and reach” of the air force, the statement said.

A military official said that the air force will go for a multi-vendor bid to buy six of these.

The three officials, who spoke on the condition of anonymity since they were not authorised to comment on the subject, did not provide any cost breakdown for the two projects.

Agencies