Airbus’s first-quarter earnings in the commercial aircraft sector have fallen by more than 80% under the impact of fewer deliveries arising from the coronavirus crisis.
The ariframer says it is maintaining a “strong focus” on cash containment after its “solid” start to the year rapidly deteriorated as the pandemic evolved.
“We are now in the midst of the gravest crisis the aerospace industry has ever known,” says Airbus chief executive Guillaume Faury.
The company has opted to cut commercial aircraft production rates and review its longer-term cost structure to ensure it can return to normal operations.
“We need to work as an industry to restore passenger confidence in air travel as we learn to co-exist with this pandemic,” says Faury.
“We’re focused on the resilience of our company to ensure business continuity.”
Airbus has previously disclosed that it delivered 122 aircraft in the quarter to 31 March, 40 fewer than in the same period last year, and some 60 could not be handed over, largely as a result of government travel restrictions.
Commercial aircraft revenues were down 22% to €7.5 billion and earnings in the sector dropped by 82% to €57 million. Its adjusted commercial EBIT was €191 million, down 59%.
Airbus says it took a €33 million charge relating to the A380 programme, which is being terminated.
Across the company overall free cash flow amounted to negative €8 billion, close to double the negative €4.3 billion from last year – although this included the payment of €3.6 billion in penalties over the high-profile bribery case, and free cash flow would otherwise have remained at a similar level to the first quarter of 2019.
The company’s total adjusted EBIT for the first quarter halved to €281 million, and it made a net loss of €481 million compared with a previous profit of €40 million.
Airbus says it will “continue to focus on cash preservation” over the coming quarters and “will be reducing cash outflows”. It says it expects measures taken so far to reduce capital expenditure this year by around €700 million, to € 1.9 billion.
