EADS AND THALES RESULTS AFFECTED BY A400M DELAYS – THALES REPORTS LOSS
28 Jul 09. EADS’ (stock exchange symbol: EAD) half-year 2009 results demonstrate that the Group is still performing well across its businesses. In doing so, EADS continues to actively monitor its customer base and its significant order book of more than €390bn. The order intake of €17.2bn reflects the slowdown in the commercial sector.
Revenues stood at €20.2bn, EBIT* before one-off at €1.3bn. EADS’ half-year EBIT* of €888m was mainly burdened by foreign exchange
effects. The Net Cash Position remains solid at €8.1bn. Thus, in the current phase of limited economic visibility, EADS continues to be well positioned to face the crisis.
“Thanks to our robust business and our disciplined financial management,
EADS is in good shape. At the same time, challenges in new programmes remain and have to be addressed. We are sticking to our priorities: protecting cash, managing the order book and deliveries and ensuring that EADS is competitively positioned in its different market segments. This was demonstrated by our recent win of the Saudi Arabia border security contract,” said Louis Gallois, CEO of EADS. “We welcome the commitment of our A400M launch customers to the programme. In partnership with our
customers and our suppliers we are now continuing to work hard in order to bring the A400M back on track.”
Group revenues slightly increased by 2 percent to € 20.2bn (H1 2008: €19.7bn). At Airbus, deliveries remained at a high level thanks to an improved second quarter compared to previous year. Revenues were negatively impacted by foreign exchange effects and an unfavourable mix including low A380 deliveries. The Astrium Division in particular contributed to increased Group revenues.
Based on a strong Q2 EBIT* – which increased by nearly 70 percent compared to previous year – EADS recorded an H1 EBIT* of €888m
(H1 2008: €1.16bn). The EBIT* was mainly burdened by exceptional
negative foreign exchange impacts. Before these exceptionals, EBIT* before one-off stood at €1.3bn (H1 2008: €2.0bn). Compared to previous year, EBIT* before one-off was weighed down by price deterioration on
aircraft deliveries and degradation of hedge rates, partially mitigated by volume and Power 8 savings. A380 costs are still higher than expected.
The Group achieved a Net Income of €378m (H1 2008: €403m), or earnings per share of €0.47 (earnings per share H1 2008: € 0.50). Self-financed R&D expenses slightly increased to € 1,172m (H1 2008: € 1,130m). This reflects Airbus’ continuing aircraft development programmes as well as the Group’s innovative momentum.
Free Cash Flow before customer financing dropped to €-948m (H1 2008: €894m). The change compared to the same period of the previous year, in which the Free Cash Flow benefited from strong inflow of customer advance payments, reflects the deterioration of the working capital and the decrease of gross cash flow from operations in line with the reduction of the EBIT* before one-off and lower hedging volume. The working capital deterioration is due to inventory build-up at Airbus and the retention of customer advance payments for the A400M programme. The outflow for the A400M amounts to €-400m. Pre-delivery payments received in H1 2009 remain in line with the H1 2008 level. Despite the currently unfavourable market environment customer financing needs remain limited in the first half. Therefore, Free Cash Flow including customer financing amounts to €1,169m (H1 2008: €975m). The Group’s Net Cash position is solid at €8.1bn (year-end 2008: €9.2bn) representing a strong asset in the current situation of limited economic visibility.
Due to lower commercial aircraft and helicopter orders, relating to the current economic climate, the Group’s order intake decreased to € 17.2bn
(H1 2008: € 51.2bn). Up to the end of June 2009, EADS’ order book
remained high at €391bn (year-end 2008: € 400.2bn), including a €