|EBIT*||expected at around € 3.2 bn|
|EPS||expected at around € 2.35|
|Revenues||more than € 37 bn expected|
|Free Cash Flow before
|Airbus deliveries||430 a/c|
Based on the achievements of the first half of 2006 and the momentum created in Farnborough, EADS expects strong commercial activities to continue throughout 2006. This healthy market forms the background to EADS' upgraded expectation for Airbus deliveries, now set at 430 aircraft in 2006, for EADS revenues well over € 37 billion for the year, and it supports further growth in the years beyond.
The EADS first half-year earnings are consistent with a year-end EBIT* of about € 3.2 billion, and EPS of around € 2.35 (taking into account a US Dollar year-end closing rate similar to 2005) at the lower end of EADS' initial outlook. This outlook, incorporating many moving parts since last May, takes into account the financial effects of the revised A380 delivery schedule and assumes charges for the partial disposal of EADS Sogerma Services.
Through the remainder of the year, certain topics are likely to affect this outlook. EADS expects that upon the industrial launch of the A350 XWB aircraft family, the Group will have to assess the costs and benefits related to previously signed A350 contracts, which may result in non-recurring charges. Furthermore, the EADS review of the A380 engineering, development and ramp-up schedule including possible consequences on other programmes may also lead to the recognition of further expenses. In parallel, Airbus' management is committed to tackle the challenges posed by the weakened US Dollar and to lay a stronger foundation for future development, and it is preparing to instigate a new competitiveness programme to that effect. Finally, the outcome of the EADS Sogerma Services restructuring, warranties and social package is not final.
EADS expects that Free Cash Flow before customer financing will be positive for the full year.
* EADS uses EBIT pre-goodwill impairment and exceptionals as a key indicator of its economic performance. The term “exceptionals” refers to income or expenses of a non-recurring nature, such as amortization expenses of fair value adjustments relating to the EADS merger, the formation of Airbus S.A.S. and the formation of MBDA, and impairment charges.