Take off for Airbus revenues and earnings, with 2024 improvement on horizon

Guillaume Faury

Airbus, the European aircraft manufacturer with key operations in the North West and South West, increased revenues and earnings in 2023 and is forecasting bigger earnings for the current financial year.

The group, which employs 5,000 staff at its wing making plant in Broughton, near Chester, and around 3,000 staff at its Filton plant in Bristol, reported annual results for 2023 today, and guidance for the current financial year in which it aims to achieve adjusted EBIT of between €6.5bn and €7bn.

During 2023, consolidated revenues increased 11% year-on-year to €65.4bn (2022: €58.8bn). A total of 735 commercial aircraft were delivered (2022: 661 aircraft), comprising 68 A220s, 571 A320 Family, 32 A330s and 64 A350s.

Revenues generated by Airbus’s commercial aircraft activities increased 15%, mainly reflecting the higher number of deliveries.

Airbus Helicopters’ deliveries were stable at 346 units (2022: 344 units) with revenues rising four percent, reflecting the overall performance across programmes and services. Revenues at Airbus Defence and Space increased two per cent, mainly driven by Military Air Systems and Connected Intelligence, offset by some updated Estimates at Completion of certain Space programmes. A total of eight A400M military airlifters were delivered (2022: 10 aircraft).

Consolidated adjusted EBIT – an alternative performance measure and key indicator capturing the underlying business margin by excluding material charges or profits caused by movements in provisions related to programmes, restructuring or foreign exchange impacts as well as capital gains/losses from the disposal and acquisition of businesses – was €5,838m (2022: €5,627m).

Adjusted EBIT related to Airbus’s commercial aircraft activities increased to €4,818m (2022: €4,600m), reflecting the higher deliveries and a more favourable hedge rate, partially offset by investments for preparing the future.

Financial year 2022 included the non-recurring positive impacts from retirement obligations and compliance-related topics partly offset by the impact resulting from international sanctions against Russia, while in the first half of 2023 provisions were released for €0.1bn from compliance-related topics.

Gross commercial aircraft orders totalled 2,319 (2022: 1,078 aircraft) with net orders of 2,094 aircraft after cancellations (2022: 820 aircraft).

The order backlog amounted to 8,598 commercial aircraft at the end of 2023. Airbus Helicopters registered 393 net orders (2022: 362 units), which were well spread across programmes and corresponds to a book-to-bill ratio above one, both in units and value.

Airbus Defence and Space’s order intake by value increased 15% to €15.7bn (2022: €13.7bn), corresponding to a book-to-bill of around 1.4 by value. Fourth quarter orders included 16 C295 aircraft for Spain.

Consolidated order intake by value increased to €186.5bn (2022: €82.5bn) with the consolidated order book valued at €554bn at the end of 2023 (year-end 2022: €449bn). The increase in the consolidated backlog value mainly reflects the company-wide book-to-bill of well above one, partly offset by the weakening of the US dollar.

Airbus Helicopters’ adjusted EBIT increased to €735m (2022: €639m), reflecting the strong performance across programmes and services. FY 2022 also included net positive non-recurring elements.

Adjusted EBIT at Airbus Defence and Space decreased to €229m (2022: €384m). The decrease reflects €0.6bn charges resulting from the update of Estimates at Completion of certain Space programmes, partially mitigated by the performance of the rest of the business. FY 2022 included some non-recurring elements, notably from the loss of two Pleiades Neo satellites.

Consolidated self-financed R&D expenses totalled €3,257m (2022: €3,079m).

Consolidated reported EBIT amounted to €4,603m (2022: €5,325m), including net adjustments of -€1,235m.

Consolidated free cash flow before M&A and customer financing was €4,386m (2022: €4,680m), mainly reflecting the level of commercial aircraft deliveries as well as the strong performance in all businesses.

Consolidated free cash flow of €3,885m (2022: €4,324m) included -€65m for M&A activities and -€436m of customer financing, mostly related to the planned execution of certain contractual obligations.

The gross cash position stood at €25.3bn at the end of 2023 (year-end 2022: €23.6bn), with a consolidated net cash position of €10.7bn (year-end 2022: €9.4bn).

The board will propose the payment of a 2023 dividend of €1.80 per share (2022: € 1.80 per share) and a special dividend of €1.00 per share to the 2024 Annual General Meeting taking place on April 10, 2024, which it said reflects its confidence in the business.

Issuing its guidance for the current 2024 financial year, the group expects to achieve around 800 commercial aircraft deliveries, adjusted EBIT of between €6.5bn and €7.0bn, and free cash flow before customer financing of around €4.0bn.

Chief executive, Guillaume Faury, said: “In 2023 we recorded strong order intake across all our businesses and we delivered on our commitments.

“This was a significant achievement given the complexity of the operating environment.”

He added: “We will continue to invest in our global industrial system, while progressing on our transformation and decarbonisation journey. Our dividend proposals are a reflection of the strong 2023 financials, our growth prospects in 2024 and balance sheet strength.”