Boeing to test fly B747-8 soon, Groupe Aeroplan recovers on stock issue – Suppliers Share Wrap


Boeing is reportedly due to test fly its first B747-8 in the next few weeks. While the anticipation of first test flight of the aircraft does not approach that which surrounded the B787, it will still be one of Boeing’s major milestones for 2010. Like the B787, the first B747-8 delivery is scheduled for 4Q2010.

More speculation has also emerged that Boeing is considering cutting production rates of its narrowbody B737. The manufacturer booked 197 gross orders for the B737 last year, and has already announced plans to reduce B777 production rates. Any production decision affecting 2010 deliveries would need to be made shortly, as changes to output generally require at least six months. Several parts suppliers stated in 2009 that they believed Boeing would lower narrowbody output this year.

Boeing and EADS shares gained 0.7% and 0.9% respectively on Thursday.

Groupe Aeroplan raising cash

Meanwhile, Groupe Aeroplan, the Canadian loyalty management company which controls interests in Aeroplan and Rewards Management Middle East, announced a plan to issue six million cumulative rate reset Preferred Shares at CAD25 per share.

The initial offering will raise CAD150 million to settle debts, but it could also issue an over-allotment of a further CAD22.5 million in shares (an additional 900,000), increasing the total to CAD172.5 million. Holders of the Preferred Shares will be entitled to receive a cumulative quarterly fixed dividend yielding 6.5% p/a for the initial five year period (ending 31-Mar-2015).

Shares dipped on 13-Jan-2010 on the announcement, losing 2.3% after trading. Shares rallied yesterday, rising 3.8% to reach CAD11.62, a 16-month high.

Selected Aviation suppliers’ daily share price movements (% change): 14-Jan-2010

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