By Rajesh Kumar Singh and Shivansh Tiwary

(Reuters) – GE Aerospace on Tuesday raised its full-year profit outlook for the third time this year, but forecast a double-digit decline in LEAP engine deliveries due to supply constraints.

The company said demand for commercial air travel remained robust, but material availability and supplier issues continued to cause disruptions and impact the production and delivery of equipment and services.

Fewer LEAP engines, which power narrow-body aircraft from Airbus and Boeing, were sold in the September quarter compared to a year ago. LEAP shipments are now expected to be down 10% this year compared to last year.

Its shares lost about 5% in premarket trading.

CEO Larry Culp said the company's efforts to address supply chain bottlenecks had improved material production compared to the previous quarter, but added that there was more work to be done.

“We are taking steps with our suppliers to increase inputs and within our own operations to expand capacity to ensure we are able to meet this historic demand,” Culp told analysts on a conference call to the results.

GE Aerospace said a strike by Boeing factory workers has not yet had a “significant” impact on the company's sales, earnings and cash flow.

The company has begun deliveries of its 9X engines for the US aircraft manufacturer's new 777X jet. While Boeing has delayed the plane's release by a year, GE Aerospace expects to increase deliveries for 9X engines next year. However, Culp said the ramp-up could be slower than expected.

GE Aerospace has a dominant share of the narrowbody jet engine market and enjoys a strong position in widebody jets. More than 70% of commercial engine sales come from parts and services.

The shortage of new aircraft due to production problems at Boeing and Airbus has forced airlines to continue flying older planes, leading to a surge in demand for after-market services.

Strong demand for services and price increases helped GE Aerospace more than offset the impact of lower engine deliveries and boost profits.

As a result, the company raised its full-year profit forecast for the third time in seven months. The company now expects 2024 adjusted earnings of $4.20 to $4.35 per share, compared to its previous forecast of $3.95 to $4.20 per share.

Adjusted profit for the quarter ended September was $1.15 per share, compared with $1.14 per share expected by analysts in an LSEG survey.

GE Aerospace reported adjusted third-quarter revenue of $8.94 billion, compared with analysts' expectations of $9.02 billion.

(Reporting by Rajesh Kumar Singh in Chicago and Shivansh Tiwary in Bengaluru; Editing by Anil D'Silva, Chizu Nomiyama and Christina Fincher)