EADS, the European defence and space giant, said that it would have to reconsider its full-year profit prediction, as it deals with an insider trading scandal and delivery delays of the Airbus A400M military transporters.

Shares in EADS were down 3.8 per cent to €22.02 in trading on Euronext, as the group said that it would issue a revised operating profit projection for 2007 in quarterly results on Thursday.

EADS said that delays of at least six months in deliveries of the A400M would cost it up to €1.4 billion (£974 million).

A group statement issued today said: “While the calculations have not been finalised, EADS currently estimates it will have to spend between €1.2 and €1.4 billion, of which more than one billion for Airbus.”

EADS gave warning last month that delivery of the A400Ms to the French Air Force would be moved back six months to 2010 because of engine problems.

But it also cautioned that a further six-month slippage could take place.

The company recently delivered the first A380 superjumbo, 18 months behind schedule because of production problems.

The delay sparked a 93 per cent drop in first half-profit to €71 million and a subsequent restructuring of Airbus.

As a result, EADS and Airbus scrapped a dual Franco-German management structure, giving the sole executive job to Louis Gallois, of EADS France, and making Thomas Enders, a German, the head of Airbus.

Job losses, running into the thousands, are also expected.

The announcement of the delay also sparked accusations of insider dealing.

Early last month a French press report said that management and shareholders sold their shares in the group just before last year's problems that pushed the shares down 26 per cent were revealed.

The report said that the French stock market regulator had prepared a document naming about 20 EADS executives and shareholders alleged to have engaged in insider trading.

The allegations are still being investigated by French authorities.

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