Airbus reports Q1 2020 results

Airbus SE reported consolidated financial results for its first quarter (Q1 2020) that ended March 31, 2020.

“We saw a solid start to the year both commercially and industrially, but we are quickly seeing the impact of the COVID-19 pandemic coming through in the numbers,” said Airbus Chief Executive Officer Guillaume Faury. “We are now in the midst of the gravest crisis the aerospace industry has ever known. We’re implementing a number of measures to ensure the future of Airbus. We kicked off early by bolstering available liquidity to support financial flexibility. We’re adapting commercial aircraft production rates in line with customer demand and concentrating on cash containment and our longer-term cost structure to ensure we can return to normal operations once the situation improves. At all times, the health and safety of Airbus’ employees is our top priority. Now we need to work as an industry to restore passenger confidence in air travel as we learn to coexist with this pandemic. We’re focused on the resilience of our company to ensure business continuity.”

Around 60 aircraft could not be delivered due to the COVID-19 pandemic. As announced in early April, due to the COVID-19 situation average monthly aircraft production rates are being adjusted to 40 for the A320 family, 2 for the A330, and 6 for the A350. This represents a reduction of roughly one third compared to pre-crisis average production rates. On the A220, the Final Assembly Line in Mirabel, Canada, is expected to progressively return to a monthly rate of 4 aircraft.

Net commercial aircraft orders totaled 290 (58 fewer aircraft than Q1 2019) with the order backlog comprising 7,650 commercial aircraft at the end of March. Airbus Helicopters booked 54 net orders (versus 66 units Q1 2019), including 21 H145s, 15 UH-72 Lakotas for the US Army, and 2 Super Pumas. Airbus Defence and Space’s order intake of $1.8 billion included military aircraft-related services, new contract wins in telecommunications and in connected intelligence. Also included is the Phase 1A demonstrator contract for Europe’s Future Combat Air Systems program.

Consolidated revenues decreased to $11.5 billion (they were $13.6 billion for Q1 2019), reflecting the difficult market environment impacting the commercial aircraft business with 40 fewer deliveries than a year earlier, partly offset by a better mix and more favorable foreign exchange environment. A total of 122 commercial aircraft were delivered (compared to 162 aircraft in Q1 2019), comprising 8 A220s, 96 A320 family, 4 A330s, and 14 A350s. Airbus Helicopters delivered 47 rotorcraft (versus 46 units in Q1 2019) with its 19% increase in revenues reflecting the favorable delivery mix and growth in services. Revenues at Airbus Defence and Space were stable year-on-year. One A400M transport aircraft was delivered in the quarter.

Consolidated earnings before income and taxes (EBIT) Adjusted – an alternative performance measure and key indicator capturing the underlying business margin by excluding material charges or profits caused by movements in provisions related to programs, restructurings, or foreign exchange impacts as well as capital gains/losses from the disposal and acquisition of businesses – declined to $305 million (Q1 2019: $596 million), mainly driven by Airbus and lower commercial aircraft deliveries and associated costs.