Airbus Targets at Least Breakeven 4Q Cash; Swung to 3Q Net Loss -- Update
By Olivia Bugault
--Airbus's third-quarter adjusted EBIT fell 49% to EUR820
--The aerospace giant is aiming for at least breakeven free cash
flow for the last three months of the year
--It booked an hefty restructuring provision in the third
Airbus SE on Thursday set a new free cash flow target for the
rest of the year after booking a net loss and restructuring
provision in its third quarter in the face of a persistent
coronavirus pandemic that has been particularly hard on the
"Despite the slower air travel recovery than anticipated, we
converged commercial aircraft production and deliveries in the
third quarter and we stopped cash consumption in line with our
ambition," Airbus Chief Executive Guillaume Faury said.
The European plane maker booked a loss of 767 million euros
($901 million) for the quarter compared with a net profit of EUR989
million a year earlier, with the more closely watched adjusted
earnings before interest and taxes falling 49% to EUR820
Reported EBIT swung to a loss as Airbus booked a restructuring
provision of EUR1.2 billion, it said. The provision comes after
Airbus said in June that it would cut 15,000 jobs--its biggest
restructuring ever--in a bid to weather what it called the "gravest
crisis" in the history of the industry.
Revenue fell 27% to EUR11.21 billion in its third quarter,
Airbus was able to stabilize its cash flow during the quarter
and reported better-than-expected free cash flow before mergers and
acquisitions and customer financing of EUR600 million.
The aerospace giant set a new cash target, which is to have at
least breakeven free cash flow before mergers and acquisitions and
customer financing in its fourth quarter. Airbus based its guidance
on the assumption of "no further disruptions to the world economy,
air traffic, Airbus' internal operations, and to its ability to
deliver products and services," it said.
New coronavirus confinement measures recently announced by
governments of countries such as France and Germany won't affect
Airbus's fourth-quarter cash target, Mr. Faury said during a
The Toulouse, France-based company said it still won't issue a
new EBIT or delivery guidance for the year.
Mr. Faury also confirmed during the call that the production
rate of its best-selling A320 family of jets will be maintained at
40 a month until at least summer 2021 and should then increase.
"Today, we have the demand to increase production" in the second
half of 2021, Mr. Faury said. On the other hand, Airbus is not
planning to ramp up the production of its widebody aircraft next
year as the recovery in long-haul traffic should take much longer,
the CEO said.
"The crisis is far from over," Mr. Faury said during the
Write to Olivia Bugault at email@example.com
(END) Dow Jones Newswires
October 29, 2020 05:16 ET (09:16 GMT)
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