EADS profits plummet in first quarter 2009EADS profits plummet in first quarter
EADS reported revenues of € 8.5 billion (2008: € 9.9 billion) in the first quarter, reflecting under-proportional Airbus deliveries (116 aircraft compared to 123 in Q1 2008). EBIT plummeted from 769 to 232 million Euros.
This decrease came mainly from negative foreign exchange impacts and an A400M accounting charge. Before these one-offs, EADS’ EBIT contracted to € 0.4 billion (Q1 2008: € 0.7 billion), mainly impacted by price deterioration on Airbus deliveries, less volume and an unfavourable product mix. EADS achieved a Net Income of € 170 million (Q1 2008: € 285 million), or earnings per share of € 0.21 (earnings per share Q1 2008: € 0.35).
Free Cash Flow before customer financing stood at € -600 million (Q1 2008: € 1,022 million). The change compared to the same period of the previous year, in which the Free Cash Flow benefited from a strongly favourable seasonal effect, reflects the decrease of gross cash flow from operations representing the lower earnings of the quarter and the deterioration of the working capital. This deterioration is mirroring a build-up of inventories at Airbus due to the mismatch between the current production rates and the under-proportional phasing of deliveries versus the full-year forecast.
Order intake amounted to € 9.3 billion (Q1 2008: € 39.3 billion), clearly reflecting lower commercial aircraft orders at Airbus and Eurocopter but supported by the order for 35 Ariane 5 worth more than € 4 billion and France’s order for 22 NH90 helicopters booked in Q1 2009. At the end of March 2009, EADS' order book remained at a record high, at € 412.6 billion (year-end 2008: € 400.2 billion), benefiting from a € 13 billion favourable US dollar impact. Orders within the commercial aircraft business are based on list prices. Robust order intake in the defence business led to a stable defence order book of € 54.9 billion (year-end 2008: € 54.9 billion).
Louis Gallois, CEO of EADS said: “Despite the economic challenges, EADS remains robust. We continue to proactively monitor our order book and deliveries and we are improving our efficiency. With regard to the A400M programme, which is a big concern for us, we need to find common solutions on the technical and the commercial frame of the contract to achieve a balanced sharing of the risks with our customers.”