2024 07 30 163324
Airbus reported a major drop in first-half profits, primarily due to a write-down of Euro 989 million for its Space operations. Without the write-off, the company’s results would have been slightly better than in 2023, reflecting the continued strength of the commercial aircraft operations despite supply-chain issues.
“The half-year financial performance mainly reflects significant charges in our space business. We are addressing the root causes of these issues,” said Guillaume Faury, Airbus’s Chief Executive Officer. In commercial aircraft, we are focused on deliveries and preparing the next steps of the ramp-up while addressing specific supply chain challenges and protecting the sourcing of key work packages.”
Airbus Commercial gained 310 net orders for commercial aircraft in the first half of 2024, while 323 were delivered, which included 28 A220, 261 A320 family, 13 A330, and 21 A350 aircraft. Commercial backlog stood at 8,585 at the end of the first half, versus 7,967 last year. Guidance for the full year is for Airbus to deliver 770 aircraft in 2024, accelerating deliveries to 437 in the second half. Historically, Airbus has produced and delivered substantially more aircraft during the 4th quarter than other manufacturers and will need to continue that trend in 2024.
Financial highlights include first-half revenues up 4.0% to 28.8 million Euros, Adjusted EBIT of 1.4 million Euros, down 41% from last year, and Earnings per share of 1.38 Euro, down from 2.47 year over year. The company’s net cash position fell from 10.7 billion Euros to 7.9 billion Euros at the end of the quarter.
The Bottom Line
The commercial aircraft group fared well despite supply chain difficulties, as did Airbus Helicopters. The Space operations’ write-off of 989 million Euros was a major hit to earnings and free cash flow. Continuing supply chain issues have prevented Airbus from ramping up narrow-body A320 family production to 75 aircraft per month, a now twice deferred objective. We expect supply chain difficulties to continue for two to three more years, albeit Airbus has made significant progress in addressing shortfalls. The company remains well-positioned to maintain profitability for the foreseeable future.
Views: 2
