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Meggitt sees possible impairment after Dassault axes Falcon 5X jet

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Meggitt sees possible impairment after Dassault axes Falcon 5X jet

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(Reuters) – Meggitt said Dassault Aviation SA’s cancellation of its Falcon 5X business jet programme could lead to a non-cash impairment of some or all of the capitalised work undertaken by Meggitt to date.

Dassault Aviation said on Wednesday it was scrapping development of the Falcon 5X jet due to delays and technical problems with its French-supplied engines. It said it would launch a new model powered by a rival supplier Pratt & Whitney Canada, a subsidiary of U.S.-based United Technologies Corp.

Aerospace and defence group Meggitt said Dassault Aviation would re-use most of the work done to date on the Falcon 5X business jet and that it intended to work with Meggitt on the successor programme.

Meggitt currently has 50 million pounds of assets relating specifically to the 5X programme, and a further 11 million pounds of assets relating to the Silvercrest engine on its balance sheet.

Meggitt said it expected to have further talks with Dassault Aviation in the coming weeks.

Meggitt also said it has good content on the Pratt & Whitney PW800 engine anticipated to be used in the successor aircraft.

Meggitt’s shares were 1.5 percent lower by 0807 GMT.

(Reporting by Noor Zainab Hussain in Bengaluru. Editing by Jane Merriman)

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