News Column

DGAP-Adhoc: Airbus Group N.V.: Airbus Group Reports First Quarter 2014 Results

May 12, 2014

Airbus Group N.V. / Key word(s): Quarter Results 13.05.2014 06:59 Dissemination of an Ad hoc announcement according to 15 WpHG, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Ad-hoc release, 13 May 2014 Airbus Group Reports First Quarter 2014 Results - Revenues increase five percent to EUR 12.6 billion - EBIT* before one-off EUR 700 million - Net income rises 93 percent to EUR 439 million - Airbus Group confirms guidance Amsterdam, 13 May 2014 - Airbus Group (stock exchange symbol: AIR) reported first quarter 2014 results reflecting the company's continued focus on programme execution and achieving its operational milestones. Group order intake(2) was EUR 21.1 billion (Q1 2013: EUR 49.5 billion), with the order book(2) value amounting to EUR 683.2 billion on 31 March, 2014 (year-end 2013: EUR 680.6 billion). Airbus received 103 net commercial aircraft orders (Q1 2013: 410 net orders), including 20 A380s for Amedeo. Order intake at Airbus Helicopters rose 50 percent and was broadly stable at Airbus Defence and Space, with good momentum seen in the Space Systems business. "The Group made further progress in the opening quarter of 2014, with improved revenues and earnings per share," said Airbus Group CEO Tom Enders. "We confirm our guidance, however there are still many challenges ahead for the rest of the year. A strong focus remains on programme execution and the implementation of our various improvement and restructuring plans." Revenues increased five percent to EUR 12.6 billion (Q1 2013: EUR 12.1 billion), with all three Divisions contributing positively and Airbus Helicopters showing a double-digit increase as deliveries rose to 74 units (Q1 2013: 58 units). Airbus revenues increased as a more favourable delivery mix, including two additional A380s compared to a year earlier, offset the overall reduction in volume to 141 commercial aircraft deliveries (Q1 2013: 144 deliveries). Airbus Defence and Space revenues rose three percent, driven by good programme execution in Space Systems. Two Ariane 5 launches were conducted in the quarter. Group EBIT* before one-off - an indicator capturing the underlying business margin by excluding material non-recurring charges or profits caused by movements in provisions related to programmes and restructurings or foreign exchange impacts - was EUR 700 million (Q1 2013: EUR 734 million) and EUR 527 million for Airbus (Q1 2013: EUR 608 million). The EBIT* before one-off at Airbus reflected operational improvement but was weighed down by a more front-loaded research and development (R&D) expense profile and A350 XWB support costs. EBIT* before one-off at Airbus Helicopters rose to EUR 58 million (Q1 2013: EUR 20 million), driven by increased deliveries and was stable at Airbus Defence and Space at EUR 85 million (Q1 2013: EUR 84 million). The Group EBIT* before one-off margin was 5.5 percent. The A350 XWB programme is progressing towards certification, with four of the five development aircraft now flying and over 1,600 flight test hours accumulated. The first two customer aircraft are now in the assembly line with certification targeted for the third quarter and entry-into-service by the end of 2014. On the maturing A380 programme, as six year maintenance checks have started Airbus is acting on the lessons learnt from tests and in-service experience. At the same time, progress is being made towards achieving the 2015 breakeven objective. Within Airbus Helicopters, the industrial ramp-up preparation is underway on the EC175 programme with entry-into-service targeted in the fourth quarter of 2014. At Airbus Defence and Space, the A400M production ramp-up is ongoing with the Turkish Air Force having taken delivery of its first aircraft in early April. Progressive enhancement of military capability will follow with subsequent upgrades to be agreed and concluded with customers. Reported EBIT*(3) increased 22 percent to EUR 719 million (Q1 2013: EUR 589 million) and included a EUR 19 million positive contribution from the dollar pre-delivery payment mismatch and balance sheet revaluation after a negative charge of EUR 131 million a year earlier. The finance result was EUR -107 million (Q1 2013: EUR -273 million) while net income(4) increased to EUR 439 million (Q1 2013: EUR 227 million), or earnings per share (EPS) of EUR 0.56 (EPS Q1 2013: EUR 0.28). Net income and EPS also reflected favourable foreign exchange effects while EPS benefitted additionally from the reduction in the number of shares linked to the buyback programme. Group self-financed R&D expenses increased to EUR 727 million (Q1 2013: EUR 617 million), due mainly to the R&D profile at Airbus and increased activity at Airbus Helicopters for the EC175 and EC145 T2 models. Free cash flow before acquisitions improved to EUR -2,034 million (Q1 2013: EUR -3,162 million), but remained negative due to the seasonality of the business and working capital requirements on key programmes. The net cash position at the end of the first quarter was EUR 6.5 billion (year-end 2013: EUR 8.5 billion) with a gross cash position of EUR 13.1 billion. Outlook As the basis for its 2014 guidance, Airbus Group expects the world economy and air traffic to grow in line with prevailing independent forecasts and assumes no major disruptions. In 2014, Airbus deliveries should be about the same level as in 2013, including the first A350 XWB delivery. Gross commercial aircraft orders should be above the level of deliveries. Assuming an exchange rate of EUR 1 = $ 1.35, Airbus Group revenues should be stable compared to 2013. Using EBIT* before one-off, Airbus Group expects moderate return on sales growth in 2014 and confirms its 2015 return on sales target of 7-8 percent(5). The EBIT* and EPS* performance of Airbus Group will depend on the Group's ability to limit "one-off" charges. Going forward, from today's point of view, the one-offs should be limited to potential charges on the A350 XWB programme and foreign exchange effects linked to the pre-delivery payment mismatch and balance sheet revaluation. The A350 XWB programme remains challenging. Any change to the schedule and cost assumptions could lead to an increasingly higher impact on provisions. Airbus Group is targeting breakeven free cash flow before acquisitions in 2014. Airbus Group Airbus Group is a global leader in aeronautics, space and related services. In 2013, the Group - comprising Airbus, Airbus Defence and Space and Airbus Helicopters - generated revenues of EUR 57.6 billion (restated) and employed a workforce of around 139,000 (restated). (The legal name change from European Aeronautic Defence and Space Company EADS N.V. ("EADS N.V.") to Airbus Group N.V. is subject to the approval of the Annual General Meeting on 27 May, 2014). Contacts for the media: Martin AgÜera +49 (0) 175 227 4369 Rod Stone +33 (0) 6 30 521 993 First Quarter (Q1) Results 2014 (Amounts in euro) Airbus Group Q1 2014 Q1 2013(1) Change Revenues, in millions 12,648 12,094 +5% thereof defence, in millions 2,151 2,086 EBITDA (6), in millions 1,180 1,013 +16% EBIT (3), in millions 719 589 +22% Research & Development expenses, 727 617 +18% in millions Net Income (4), in millions 439 227 +93% Earnings Per Share (EPS) (4) 0.56 0.28 +100% Free Cash Flow (FCF), in millions - 2,034 - 3,162 - Free Cash Flow - 2,034 - 3,162 - before Acquisitions, in millions Free Cash Flow - 1,896 - 3,089 - before Customer Financing, in millions Order Intake (2), in millions 21,101 49,545 -57% Airbus Group 31 March 31 Dec Change 2014 2013(1) Order Book (2), in millions 683,248 680,560 0% thereof defence, in millions 42,208 42,630 Net Cash position, in millions 6,547 8,454 -23% Employees 138,924 138,830 0% by Division Revenues EBIT (3) (Amounts in millions of Euro) Q1 Q1 Change Q1 Q1 Change 2014 2013(1) 2014 2013(1) Airbus 8,937 8,759 +2% 546 463 +18% Airbus Helicopters 1,182 1,038 +14% 58 20 +190% Airbus Defence and Space 2,743 2,664 +3% 85 84 +1% Others / Headquarters / - 214 - 367 - 30 22 - Eliminations Total 12,648 12,094 +5% 719 589 +22% by Division Order Intake (2) Order Book (2) (Amounts in millions of Euro) Q1 Q1 Change 31 March 31 Dec Change 2014 2013(1) 2014 2013(1) Airbus 17,938 46,668 -62% 628,910 625,595 +1% Airbus Helicopters 1,202 804 +50% 12,439 12,420 0% Airbus Defence and Space 2,068 2,160 -4% 42,588 43,208 -1% Others / Headquarters / - 107 - 87 - - 689 - 663 - Eliminations Total 21,101 49,545 -57% 683,248 680,560 0% Footnotes: 1) The 2013 figures have been restated to reflect the application of IFRS 10 and 11. Wherever necessary, Divisional figures are also restated to reflect the new Group structure as of 1 January 2014. 2) Contributions from commercial aircraft activities to Order Intake and Order Book based on list prices. 3) Earnings before interest and taxes, pre goodwill impairment and exceptionals. 4) Airbus Group continues to use the term Net Income. It is identical with Profit for the period attributable to equity owners of the parent as defined by IFRS Rules. 5) Return on sales for EBIT* before one-off, including A350 XWB dilution with a EUR/$ exchange rate of 1.35. 6) Earnings before interest, taxes, depreciation, amortisation and exceptionals. 13.05.2014 DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Airbus Group N.V. P.O. Box 32008 2303 DA Leiden Netherlands Phone: 00 800 00 02 2002 Fax: +49 (0)89 607 - 26481 E-mail: ir@eads.net Internet: www.eads.com ISIN: NL0000235190 WKN: 938914 Indices: MDAX Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, DÜsseldorf, Hamburg, Hannover, MÜnchen, Stuttgart End of Announcement DGAP News-Service ---------------------------------------------------------------------------


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Source: DGAP Ad Hoc Disclosures