Airbus loses 481 million euros in the first quarter

  •   29/04/2020 - 11h20
  •   HARMANT Adeline

This Wednesday morning, the Airbus group announced a loss of 481 million euros over the first quarter of 2020, mainly due to the health crisis and the coronavirus pandemic currently affecting the world and the aviation sector in particular.

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Airbus loses 481 million euros in the first quarter
Image copyright: reeser - Flickr

The detail of the announcement made by Airbus this morning:

While it had made a net profit of 40 million euros in 2019 and over the same period, the balance sheet for the first quarter of 2020 is negative for Airbus with a record loss of 481 million euros.

As for the group's turnover, it fell by 15.2% over this period to 10.6 billion euros. This is a good reflection of the difficulties encountered by the commercial aviation market. Indeed, Airbus delivered 40 fewer aircraft in the first quarter than last year due to the health crisis.

The group specifies that despite a solid start to the year, the impact of the Covid-19 pandemic is currently clearly visible in the accounts. According to the group's management, this is the most serious crisis ever faced by the aeronautics industry.

Furthermore, Airbus has not announced any earnings targets for the year at this stage.

 

Is the Airbus group in danger?

Let us recall that the boss of Airbus, Guillaume Faury, before sending last week a letter to the employees of the group in which he said he was studying all the options in the face of this major crisis. As a result, new hirings have been frozen and mass layoffs are being considered. Currently in France, only 3,000 of the 48,000 employees in the group are subject to short-time working, with 92% of their net salary being maintained.

The group also says it expects the situation to worsen and points out that much remains unknown and unpredictable. It speaks of a 50% drop in the production rate in view of the drop in airline activities and indicates that the survival of the group is indeed at stake. The group's cash flow is indeed suffering more and more from a weak cash inflow and significant outflows.

 

No change in the order book:

With regard to the detail of the group's activities, we note an increase in the activity of the Airbus Helicopters subsidiary by 19% to 1.2 billion euros, as well as that of the Airbus Defense and Space subsidiary, which stagnated at 1.02 billion euros. It is therefore the commercial activity which suffers most from the current situation.

The group delivered 122 aircraft during the quarter and produced 60 new aircraft that could not be delivered to customers due to the covid-19 outbreak. In total, orders placed with the Group during these three months amounted to 290 aircraft, compared with negative orders for 58 aircraft in the first quarter of 2019. There has therefore been no impact of the coronavirus on the group's order book for the time being.