Airbus offers an update on its 2024 planning and forecasts
Airbus, the European aerospace giant, has updated its guidance for 2024, revealing a change in the trajectory for commercial aircraft deliveries and a focus on addressing challenges in its space programmes.
In a significant move, the company now expects to deliver around 770 commercial aircraft in 2024. This figure represents an adjustment to the ramp-up trajectory, reflecting specific supply chain challenges in a degraded operating environment. The target production rate of 75 A320 Family aircraft a month is maintained, and is now expected to be reached in 2027.
The update to the 2024 guidance comes after an extensive technical review of all programmes, conducted by the Space Systems management team in the first half of the year. The review identified further commercial and technical challenges in the space programmes, primarily in areas such as engines, aerostructures, and cabin equipment.
Airbus is reporting charges of around € 0.9bn related to certain telecommunications, navigation, and observation space programmes. These charges are due to updated assumptions on schedules, workload, sourcing, risks, and costs over the lifetime of these programmes.
The €0.9 billion charges primarily relate to one-off costs in Space Systems from 2024, which influenced the reported results rather than recurring operational losses. The company reported these as material non-recurring items, influencing EBIT and net income for that period.
Despite these challenges, Airbus's 2025 guidance assumes no further similar disruptions from such charges and targets around 820 commercial aircraft deliveries, an adjusted EBIT of about €7.0 billion, and free cash flow before customer financing of approximately €4.5 billion in 2025.
An analyst call will be held on 24 June 2024 at 19h45 CEST Paris time, during which the company will provide more details about its 2024 guidance and the challenges faced in its space programmes. The analyst call can be followed via the Airbus website at https://www.our website/en/investors. The analyst call presentation will also be made available on the Airbus website.
It is important to note that the 2024 guidance does not include Mergers and Acquisitions. The Company's half-year results will be disclosed on 30 July 2024. The update to the 2024 guidance assumes no additional disruptions to the world economy, air traffic, the supply chain, the company's internal operations, and its ability to deliver products and services.
In summary, Airbus continues to face supply chain pressures but aims to ramp up production while reducing such extraordinary charges. The company is focusing on addressing challenges in its space programmes, while maintaining its target production rate for commercial aircraft. The analyst call on 24 June 2024 will provide more insights into the company's plans and strategies for the rest of the year.
The 2024 guidance update by Airbus indicates a shift in focus towards addressing challenges in their space programmes, which encompass areas such as engines, aerostructures, and cabin equipment (challenges). The company is targeting around 820 commercial aircraft deliveries in 2025, a figure that assumes no further disruptions from similar charges (business).
