Airbus posts €481m first-quarter net loss as CEO warns aerospace industry faces “gravest crisis” ever known

Airbus has revealed a 49% drop in first-quarter adjusted operating profit as the impact of the coronavirus crisis takes its toll on the planemaker.

The company, which announced this week it is to furlough 3200 workers at its Broughton plant saw consolidated revenue decrease to € 10.6 billion from € 12.5 billion in quarter 1 of last year. 

Airbus which has delivered 40 less aircraft than quarter 1 last year posted a net loss was € 481 million euros compared with a net profit of € 40 million for the same period in 2019.

Adjusted earnings stand at € 281 down from € 549 in the quarter on 2019, a drop of 49%.

Earnings day: Solid start to the year, but now in the midst of the gravest crisis the industry has known. Therefore “[…] we need to work as an industry to restore passenger confidence in air travel as we learn to coexist with this pandemic.” said #Airbus CEO @GuillaumeFaury https://t.co/Xc5kCPWdu3

— Philipp Encz (@encz) April 29, 2020

“We saw a solid start to the year both commercially and industrially but we are quickly seeing the impact of the COVID-19 pandemic coming through in the numbers,” said Airbus Chief Executive Officer Guillaume Faury.

“We are now in the midst of the gravest crisis the aerospace industry has ever known.

We’re implementing a number of measures to ensure the future of Airbus.

We kicked off early by bolstering available liquidity to support financial flexibility.

We’re adapting commercial aircraft production rates in line with customer demand and concentrating on cash containment and our longer-term cost structure to ensure we can return to normal operations once the situation improves.

At all times, the health and safety of Airbus’ employees is our top priority.

Now we need to work as an industry to restore passenger confidence in air travel as we learn to coexist with this pandemic.

We’re focused on the resilience of our company to ensure business continuity.”

Airbus said , “given the current COVID-19 environment, various measures were announced in late March 2020 to protect the Company’s financial liquidity and continue to fund its operations.

These included securing a new credit facility amounting to € 15 billion, withdrawing the 2019 dividend proposal and suspending the voluntary top up in pension funding.

In addition, a € 2.5 billion bond was issued, partially terming out the € 15 billion credit facility, and settled on 7 April 2020.

In coming quarters, the Company will continue to focus on cash preservation and will be reducing cash outflows.”

Airbus said on Monday it is to furlough 3,200 employees at its plant at Broughton in response to the coronavirus crisis which has hit the airline industry hard. 

The move has been agreed with the company’s unions, is expected to involve groups of workers being furloughed for staggered 3 week periods.

The majority of Airbus Production and Production-Support teams in Broughton will be impacted by the move.

Up to 500 agency workers are to be made redundant at Broughton according to Unite Union.

Specialist service provider Guidant Global said it intends to make the agency workers redundant at the Broughton wing making factory.