European aircraft maker Airbus said on Thursday, October 29, that one-off charges related to the deep job cuts announced earlier this year pushed it deep into the red in the 3rd quarter.
Airbus said in a statement that it booked a net loss of 767 million euros ($900 million) in the period from July to September, compared with profit of 989 million euros a year earlier.
Operating or underlying profit fell by 49% to 820 million euros and revenues declined by 27% to 11.2 billion euros, the statement said.
Earnings were hit by a restructuring charge of 1.2 billion euros related to the decision to axe 15,000 jobs.
And while Airbus said that uncertainty resulting from the coronavirus pandemic prevented it from issuing any earnings forecast for the whole year, it was confident it had stopped the cash hemorrhage seen earlier this year.
“The company assumes no further disruptions to the world economy, air traffic, Airbus’ internal operations, and to its ability to deliver products and services. On that basis, the company targets at least break-even free cash flow…and customer financing in the 4th quarter of 2020,” it said.
Chief executive Guillaume Faury said that “after 9 months of 2020 we now see the progress made on adapting our business to the new COVID-19 market environment.
“Despite the slower air travel recovery than anticipated, we converged commercial aircraft production and deliveries in the 3rd quarter and we stopped cash consumption in line with our ambition,” Faury said.
With global air traffic not expected to return to 2019 levels until 2023 or 2025, Airbus said it had scaled down the rate of production of its A320, A220, A330, and A350 planes.
In the 9 months to September, aircraft deliveries have fallen by about 40%, with a shortfall of about 20% in the 3rd quarter alone. – Rappler.com
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