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14 May 10. EADS’ (stock exchange symbol: EAD) macroeconomic and commercial environment is gradually improving but remains challenging. Proactive order-book management and robust deliveries across all businesses continued throughout the first quarter. Revenues stood at €9.0bn. The EBIT* before one-off amounted to €0.15bn thanks to good performance in Airbus legacy programmes as well as space and defence activities. It was weighed down by A380 and hedge deterioration.
EADS’ EBIT* amounted to €83m after exceptional foreign exchange effects. The order intake of €14.4bn reflects improving commercial momentum in a challenging market environment. The Group’s order book of €416bn provides a solid platform for future deliveries. EADS’ Net Cash position of € 8.8bn remains a strong asset.

“I am cautiously optimistic that our industry is slowly on its way back up. Economic indicators signal a recovery trend of the global economy. This has a clear positive impact on air traffic. But recent turbulence on the financial markets also reminds us that the crisis is not yet fully behind us. Volatility is still high, particularly due to the weakness of some Euro-zone economies. Due to the corresponding strengthening of the Dollar, EADS should benefit in the mid-and long-term if the Dollar trend is confirmed”, said Louis Gallois, CEO of EADS. “The key priority for this year is to deliver on our programmes. We need to progress with the A380, to finalise the contract amendment with the Customer Nations on A400M, while moving forward on the technical side and to step up the development of the A350.”

In the first three months, EADS’ revenues increased to €9.0bn (Q1 2009: € 8.5bn), supported by a combination of higher volume and a favourable mix on commercial aircraft deliveries at Airbus (119 units with revenue recognition compared to 116 in Q1 2009). Moreover, Eurocopter, Astrium and Other Businesses contributed positively. These effects were partly offset by negative foreign exchange impacts and lower revenue recognition for the A400M programme. In 2010, the application of the percentage of completion method is resumed; no revenue milestones have been recognised in the first quarter 2010.

EBIT* before one-off – an indicator capturing the underlying business margin by excluding non-recurring charges or profits caused by movements in provisions or foreign exchange impacts – stood at €0.15bn (Q1 2009:
€0.4bn) for EADS. Compared to Q1 2009, a favourable mix on Single
Aisle and Long Range aircraft were more than offset by mainly the
degradation of hedge rates and a reduction of Headquarters and eliminations EBIT*. This reduction is due to a change in the allocation of real estate costs and a lower contribution from Dassault. In addition, the A380 continues to weigh significantly on the underlying performance. Despite strong currency headwinds and A380 operational challenges, EBIT* before one-off at Airbus amounted to €0.08bn.

EADS’ EBIT* of €83m (Q1 2009: €232m) was further weighed down by exceptional negative foreign exchange impacts. Exchange rate impacts weighed on the Q1 2010 EBIT* by around €300m compared to Q1 2009.

Net Income amounted to €103m (Q1 2009: €170m), or earnings per share of €0.13 (earnings per share Q1 2009: € 0.21). This reduction was driven by the EBIT* deterioration. The financial result improved: the main change comes from the 2009 negative revaluation of the options while in the first quarter of 2010 the option restructuring programme was completed.
Self-financed Research & Development (R&D) expenses slightly increased
to €572m (Q1 2009: €562m), mainly due to higher activities at Defence & Security.

Free Cash Flow before customer financing of €-972m (Q1 2009: €-600 m) reflected an increase of inventories and the cut off effect of customer payments received at the end of 2009. Customer financing needs for the quarter amounted to around € 150 m. Free Cash Flow after customer financing amounted to €

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