Airbus Focuses On Delivery Ramp-Up And Supply Chain Management In Half-Year Report

Airbus has reported its half year results following the quarter that ended on June 30. While consolidated revenue increased a bit compared to last year, it reported a decline in adjusted operating profit in the second quarter. The plane maker’s financial performance was influenced by charges in its space business among other things, with some reports suggesting that it could restructure its Space Systems.

Aircraft orders

Airbus reported its gross commercial aircraft orders for H1 2024 at 327 compared to 1,080 aircraft last year for the corresponding period. Its net orders after cancelation were at 310 compared to 1,044 aircraft in Hi 2023. In all, Airbus is sitting on an aircraft backlog of 8,585 commercial aircraft as of June 30, 2024.

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Airbus Helicopters saw 233 net orders, which included 38 H225s for the German Federal Police in the second quarter. Its Defence and Space’s order intake value was €6.1 billion. Guillaume Faury, Airbus Chief Executive Officer, reflected on the performance so far and commented,

“The half-year financial performance mainly reflects significant charges in our space business. We are addressing the root causes of these issues. In commercial aircraft, we are focused on deliveries and preparing the next steps of the ramp-up, while addressing specific supply chain challenges and protecting the sourcing of key work packages.”

Second-quarter profit declines

Airbus reported a consolidated revenue for the first half of 2024 to be €28.8 billion ($31.17 billion). This was 4% more year-on-year on the back of airplane deliveries as well as a higher volume in the Air Power business of Airbus Defence and Space.

The European plane manufacturer pushed 323 commercial aircraft out of its factories in the first six months compared to 316 in H1 2023. These comprised 28 A220s, 261 A320 Family, 13 A330s and 21 A350s. Airbus is also marching towards an A220 ramp-up of a monthly production rate of 14 aircraft in 2026. Its production rate of 75 A320 Family aircraft per month has been pushed to 2027 due to specific supply chain issues.

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The Air Power business of Airbus Defence and Space drove revenues up by 7%, but it was partly offset by the recent update of Estimates at Completion assumptions in Space Systems. The consolidated EBIT adjusted at Airbus Defence and Space was € -807 million ($ -873 million). This included the €989 million of forward losses in its space business.

When the second quarter is examined in isolation, Airbus reported a revenue of €15.99 billion ($17.30 billion). However, its adjusted operating profit declined by more than half to €814 million ($880 million). However, these were still more than €699 million in profit as estimated by analysts for this quarter.

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Outlook for the remaining year

Assuming no significant disruption to the world economy, air traffic, and supply chain, Airbus expects around 770 commercial aircraft deliveries by the end of this year and an EBIT adjusted of around €5.5 billion ($5.95 billion).

Photo: Airbus

There are reports that Airbus is planning a restructuring of its Space Systems business. According to Reuters, the plane maker is working on a turnaround plan for this division, with sources saying that it also hopes to have a separate Space Systems strategy review in the last quarter of this year. Airbus, however, has not issued any official comment on this matter.

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