Airbus falls to first ever loss
PrintDelayed A380 blamed
Posted in Financial News, 9th March 2007 15:37 GMT
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Airbus has posted the first loss in its corporate history, blaming delays to the A380 superjumbo.
Joint chief executive Louis Gallois told the BBC it was the worst year in Airbus's life.
The company has already announced 10,000 job losses to cope with the two year delay to its primary project.
Although Airbus sold a record number of planes (434 versus 387 in 2005) and increased revenues by 14 per cent to €25.19bn, it still made a hefty loss. The division reported a loss (earnings before interest and tax) of €572m.
It said the financial impact of the delayed plane is €2.5bn. This is made up of: €1.2bn in extra costs and loss making contracts, €0.8bn in payments due now which Airbus expected to pay later, and a further €0.5bn in previously unannounced charges. Hedging currency against the dollar also contributed to the loss.
Parent company European Aeronautic Defence and Space Company brought in revenues of €39.4bn, up 15 per cent, but profits were hit by Airbus problems and are were down to €399m compared to €2,852 in 2005.
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