Airbus SE — Earnings Release 2004

Mar 9, 2005

News Details

Ad-hoc | 9 March 2005 07:00

EADS Success Continues in 2004

Ad hoc announcement §15 WpHG EADS-Results 2004 EADS Success Continues in 2004 Ad hoc announcement processed and transmitted by DGAP. The issuer is solely responsible for the content of this announcement. —————————————————————————— EADS Success Continues in 2004: Ambitious Financial Targets Met for Fifth Consecutive Year – Revenues Euro 31.8 billion – up 5 percent – EBIT* Euro 2.4 billion – up 58 percent – Net Income Euro 1.03 billion – up 60 percent – Net cash Euro 4.1 billion – up 31 percent – Earnings per share Euro 1.29 – up 61 percent – Dividend proposal Euro 0.50 – up 25 percent – Airbus market leader in deliveries, order intake and profitability – Space returned to profit, and now set for further growth of profitability – Continued Defence growth (revenues up 8 percent) EADS (stock exchange symbol: EAD) further strengthened its position as a global leader in aerospace and defence and entered into a new growth period in 2004. The company exceeded its financial targets for the fifth consecutive year. EBIT* (pre-goodwill and exceptionals) stood at Euro 2.4 billion for the year, up 58 percent over 2003, Net Income was up 60 percent to Euro 1.03 billion. EADS’ EBIT* margin rose from 5.1 percent to 7.7 percent in 2004, an unprecedented level for EADS. Stronger revenues of Euro 31.8 billion (2003: Euro 30.1 billion) were achieved through growth across all five divisions. Key growth drivers were Airbus, which benefited from the start of the market upturn, and EADS Defence businesses, up eight percent to Euro 7.7 billion (2003: Euro 7.1 billion). At constant US dollar exchange rates, total EADS revenues would have grown by seven percent. The strong EBIT* growth follows solid profit improvement at Airbus and Space. At Airbus, EBIT* surged to Euro 1.922 billion, or 9.5 percent of revenues mainly due to higher deliveries, a higher proportion of large aircraft deliveries and cost savings. The Space Division returned to profitability on schedule. The Defence and Security Systems Division’s EBIT* increased by 33 percent (Euro 57 million). The Aeronautics and Military Transport Aircraft Divisions each achieved an EBIT* close to 2003 levels. The Research and Development (R&D) expenditure in 2004 stood at Euro 2.1 billion, reflecting EADS’ continued high level of investment in innovation (2003: Euro 2.2 billion, 2002: Euro 2.1 billion). As in 2003, about half of this was spent on R&D for the A380, the 555-seater Airbus aircraft expected to generate more than US $ 175 billion in sales in the first fifteen years of production after entry-into-service in 2006. Order Book continues to increase The EADS order intake remained strongly above the level of revenues and amounted to Euro 44.1 billion in 2004. The EADS order book increased by nearly three percent to Euro 184.3 billion (2003: Euro 179.3 billion). At constant exchange rates, the increase would have been about seven percent. 2004 saw continued growth in the defence order book, to Euro 49.1 billion. Strong increase in Cash – after continuing investments EADS’ net cash position was boosted 31 percent to Euro 4.1 billion (2003: Euro 3.1 billion) signalling early market recovery in the commercial aircraft market and better management of programme financing in Defence. Free Cash Flow before Customer Financing was again strongly positive reaching Euro 1.8 billion (2003: Euro 2.1 billion). This performance includes the high R&D and investment spending for the A380 and the company’s continued investment in other future growth drivers like the A400M, NH90 and other helicopters, Paradigm Secure Communications and the tanker boom. Airbus Customer Financing also indicates a commercial aviation recovery as gross exposure has decreased since 2003 following two years of strong net cash demand. Net Income of Euro 1.03 billion Net Income in 2004 was at Euro 1.03 billion, up 60 percent from last year’s Net Income of Euro 644 million. The 2003 figure (reported at Euro 152 million) was restated for comparison following the implementation of the IFRS3 accounting rule. Net Income no longer includes regular goodwill amortization. Earnings per share stood at Euro 1.29, up from Euro 0.80 in 2003. Dividend proposal of Euro 0.50 per share In light of EADS’ continuing strong performance, the Board of Directors is recommending to the Annual General Meeting of shareholders an increased dividend of Euro 0.50 per share. Outlook EADS expects its 2005 revenues to grow to around Euro 33 billion, impacted partly by a weaker dollar assumption (Euro 1 = US$ 1.30). Defence revenues should increase by 10 percent during the course of the year. EBIT* is expected to grow to more than Euro 2.6 billion (up six percent), reflecting an increase in divisional performance across the group, partly offset by less favourable hedges and by the weak US Dollar for the unhedged portion of the net exposure. EADS expects Airbus to deliver 350-360 aircraft in 2005. Airbus revenues are expected to increase in line with higher deliveries of single aisle aircraft. The 2005 aircraft mix will be less favourable than in 2004. The positive accounting impact from the Airbus GIE merger into Airbus SAS is expected to diminish in 2005. Free Cash Flow before Customer Financing and Paradigm investment outflows is expected to be positive in 2005. Earnings Per Share should increase in 2005 by five percent to Euro 1.36, based on an average of 803 million shares. * EADS uses EBIT pre-goodwill amortization and exceptionals as a key indicator of its economic performance. The term “exceptionals” refers to income or expenses of a non-recurring nature, such as amortization expenses of fair value adjustments relating to the EADS merger, the formation of Airbus S.A.S. and the formation of MBDA, and impairment charges. Contact: Rainer Ohler EADS +49 89 60 73 42 35 European Aeronautic Defence and Space Company Beechavenue 130-132 1119 PR Schiphol Rijk Niederlande ISIN: NL0000235190 (MDAX) WKN: 938914 Listed: Amtlicher Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin- Bremen, Düsseldorf, Hamburg, Hannover, München und Stuttgart End of ad hoc announcement (c)DGAP 09.03.2005 090700 Mär 05