Rolls-Royce to Miss 2010 Profit Target After Qantas Incident

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One week after one of its jet engines exploded in mid-air, Rolls-Royce said it will miss its profit target for 2010.

Rolls-Royce said that growth in underlying profit will be "slightly lower" than the expected 4% to 5%, Bloomberg News reported.

The engine exploded on an Airbus A380 belonging to Qantas Airways (QUBSF). The plane was flying from Singapore to Sydney, Australia and had to make an emergency landing in Singapore.

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The explosion, which scattered debris across an Indonesian island, was caused by an oil fire, according to Rolls-Royce. Qantas's fleet of A380s is still grounded following the accident.

Rolls-Royce isn't the only one hurting as a result of the explosion. Airbus said that deliveries of the A380 may suffer in 2011.

Tom Enders, CEO of Airbus, said that providing existing customers with new engines and spare parts will be the company's priority. That could mean delays in delivering passenger jets in 2011.

"Progress on the A380 is very material to profitability recovery at Airbus," Nick Cunningham, an analyst at Agency Partners, told Bloomberg News. "You really need to have the A380 settle down and start working normally and gradually build up the production rate."

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