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EADS REPORTS LOSS

30 Jul 03. EADS reported a net loss of €66m ($76m) compared with a profit of €91m a year earlier, but added that it was sticking to its outlook for the full year. The company’s first-half loss was in line with analysts’ forecast of a loss in the range of €57-90m.

“EADS, the world’s second largest aerospace and defence company, achieved half-year results fully in line with its expectations and confirmed its 2003 targets,” the company said in a statement. For 2003, EADS forecasted full-year earnings before interest and taxes (EBIT) to be in the “same range” as last year’s €775m, based on 300 aircraft deliveries by Airbus, and sales were expected to match the 2002 full-year level of €29.9bn. The company said the expected decrease in Airbus revenues should be compensated for by growth in other divisions such as Defence and Security Systems.

EADS said it was on track to achieve a turnaround in 2004 in its Space division, and said it saw “very early signs of a recovery on the horizon” in the civil aviation business.

“The EADS half-year results confirm our outlook for the full year,” EADS chief executive officers Philippe Camus and Rainer Hertrich said. “Based on our strong order intake and our recent market successes, whe should be well-positioned once our markets pick up again to deliver strong growth in cash and overall financial performance,” they said. Excluding goodwill and exceptional items, EADS said net income fell to €231m in the first half, down from €462m a year earlier.

EBIT plunged 24 percent in the first six months of the year to €592m from the same period a year ago. Sales fell to €13.06bn from €14.0bn, while its Airbus unit posted sales of €13.06bn compared with €13.974bn a year earlier. First-half orders surged to €43.19bn, up 192 percent compared with €14.791bn a year ago. Airbus orders jumped 221 percent to €33.174bn.

Among the principal impacts on the results were research and development spending at aircraft maker Airbus, up by 221 million mainly for the planned A380 super-jumbo passenger jet, and fewer Airbus deliveries — 149 in the first half compared with 160 a year earlier, the company said. Also affecting results was a restructuring charge at the Space division of €88m, it said.

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