Airbus SE (AIR) reported a drop in its first-quarter financial results, with a slight decrease in consolidated revenues to €11.8 billion compared to €12.0 billion in Q1 2022. Despite a strong demand for its products, particularly commercial aircraft, the company continues to face challenges in the supply chain and an unfavorable operating environment.
During the first quarter, Airbus delivered 127 commercial aircraft, which is down from 142 aircraft delivered in Q1 2022. The company’s CEO, Guillaume Faury, said, “We remain focused on delivering the commercial aircraft ramp-up and longer-term transformation.” He also acknowledged the benefits of good performance in the Helicopters division during the quarter.
Gross commercial aircraft orders for the first quarter totaled 156, down from 253 in Q1 2022. After cancellations, net orders stood at 142 aircraft, up from 83 in Q1 2022. The order backlog reached 7,254 commercial aircraft at the end of March 2023. Airbus Helicopters registered 39 net orders, down from 56 in Q1 2022, while Airbus Defence and Space’s order intake by value was €2.5 billion, down from €3.2 billion in Q1 2022.
Airbus’ commercial aircraft activities experienced a 5% year-on-year decrease in revenues, mainly due to lower deliveries, partially offset by a strengthening US dollar. The company delivered 71 helicopters, up from 39 units in Q1 2022, with a 26% increase in the division’s revenues. However, revenues at Airbus Defence and Space decreased 6%, primarily driven by lower volume in Military Air Systems and Space Systems.
Consolidated EBIT Adjusted, a key indicator of the underlying business margin, decreased to €773 million from €1,263 million in Q1 2022. EBIT Adjusted for Airbus’ commercial aircraft activities also decreased to €580 million from €1,065 million in Q1 2022.
Airbus is ramping up production on its A220 and A320 Family programmes, targeting a monthly production rate of 14 aircraft for the A220 by mid-decade and 65 aircraft for the A320 Family by the end of 2024. The A321XLR flight test program is progressing, with entry-into-service expected in Q2 2024. The company also aims to achieve rate 4 for the A330 in 2024 and rate 9 for the A350 by the end of 2025.
Airbus also detailed that, although some milestones have already been reached in the production of the first A350F components, the entry into service of the freighter will be delayed from 2025 to 2026.
EBIT Adjusted for Airbus Helicopters increased to €156 million from €90 million in Q1 2022, while EBIT Adjusted for Airbus Defence and Space decreased to €36 million from €106 million in Q1 2022.
The A400M program faces risks in terms of technical capabilities qualification, aircraft operational reliability, cost reductions, and securing overall volume as per the revised baseline. Consolidated self-financed R&D expenses amounted to €683 million, up from €586 million in Q1 2022.
The company’s 2023 guidance remains unchanged, targeting around 720 commercial aircraft deliveries, EBIT Adjusted of €6.0 billion, and Free Cash Flow before M&A and Customer Financing of €3.0 billion.
