Slide 1: Assuring Consistent Growth – FY 2004 Earnings
Assuring Consistent Growth FY 2004 Earnings Philippe Camus / Rainer Hertrich Chief Executive Officers Hans Peter Ring Chief Financial Officer 1 Earnings conference call – 9th March 2005 Safe Harbor Statement Certain of the statements contained in this document are not historical facts but rather are
Slide 2: 2004: Entered the Growth Era
Content 2000 2004: The Step Beyond 2004 performance by division 2004 Financials Roadmap 3 2004: Entered the Growth Era change change from 2003 from 2000 • Revenues € 31.8 bn +5% +31% • EBIT* € 2.4 bn +58% +75% • EPS € 1.29 +61% • Net cash position € 4.1 bn +31% +34%** • Order-book € 184.3 bn +3% +40
Slide 3: 2004: Exceeded Financial Targets Again
2004: Exceeded Financial Targets Again EADS promised… ….and achieved 2004 Book-to-bill over one 9 1.4 EBIT* of 2.2 €bn 9 € 2.4 bn Revenues ~ 32€bn (@ € =1.23$ **) 9 € 31.8 bn (@ €=1.24$**) FCF pre-customer fin. >0 9 € 1.8 bn Book-to-bill over one 9 >2.0 2003 EBIT* ~ stable from 2002 9 +8% Revenues ~
Slide 4: 2000-2004: Beyond Borders / Beyond the Standard
2000 2004 : Beyond Borders Global Footprint Highlights Asia: Europe: China: - 5% in AviChina - Eurofighter - Airbus engineering center - A400M - EC120 co-production - FSTA & Skynet 5 (UK) - £350 million Airbus Japan: factory (Broughton, UK) - EC: 10% of Euroheli Transatlantic partnerships: - A380 su
Slide 5: 2000-2004: Beyond Limits
2000 2004 : Beyond Limits Key Programme Breakthroughs 9 Dec 2003: January/ April 2004: 19 Dec 2000: 8 April 2002: A310 MRTT Australia/ UK Pick A380 launched Eurofighter Rollout A330 MRTT 10 Dec 2004: 27 May 2003: Maiden Flight Airbus Announces A350 A400M Launch EADS Creation: 2005 & 2001 2002 2003 2
Slide 6: Beyond Expectations: Building Financial Momentum; Sharing the Fruits
2000 2004 : Beyond Expectations Building Financial Momentum Data as of March 4, 2005 2001 2002 2003 2004 2005 170 150 EADS 130 Base 100 : 10 July 2000 110 BOEING 90 THALES 70 CAC 40 BAE Systems 50 30 10 J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J
Slide 7: Airbus
Content 2000 2004: The Step Beyond 2004 performance by division 2004 Financials Roadmap 13 Airbus €m FY 2004 FY 2003 • EBIT* margin at 9.5%. Deliveries 320 305 • EBIT* up 42% : Revenues • Higher deliveries and 20,224 19,048 favourable mix R&D self-financed** 1,734 1,819 in % of revenues 8.6% 9.5% •
Slide 8: Airbus Customer Financing Reduced in 2004; MTA
Airbus Customer Financing Reduced in 2004 Active exposure management Additions and Disposals to Airbus customer financing gross exposure in $ bn Net Exposure fully 2.5 2.5 Additions Sell Down Amortization provisioned 1.5 1.5 1.5 1.5 1.2 1.4 0.5 0.5 1.0 0.6 0.5 -0.2 -0.5 -0.5 -0.7 -0.7 -0.7 Net -0.2
Slide 9: Aeronautics and Space
Aeronautics €m FY 2004 FY 2003 • Revenues and EBIT*: Revenues 3,876 3,803 • Eurocopter improvement R&D self-financed 68 62 • Sogerma degradation in % of revenues 1.8% 1.6% • Negative impact from $ weakness EBIT* 206 217 in % of revenues 5.3% 5.7% • Eurocopter: Military and homeland Order book busine
Slide 10: Defence and Security Systems
Defence and Security Systems • Revenues up 4%: driven by €m FY 2004 FY 2003 MBDA Revenues 5,385 5,165 • EBIT* driven by : R&D self-financed 185 223 • Performance improvement in % of revenues 3.4% 4.3% • Restructuring mainly for DCS EBIT* 228 171 • Litigation provision release: €106m in % of revenues
Slide 11: Profit & Loss Highlights; Development of Net Cash
Profit & Loss Highlights FY 2004 FY 2003 in % of in % of €m Revenues €m Revenues Revenues 31,761 30,133 self-financed R&D*** 2,126 6.7% 2,189 7.3% EBITDA 3,853 12.1% 3,137 10.4% EBIT* 2,444 7.7% 1,543 5.1% EBIT* before R&D 4,570 14.4% 3,732 12.4% Interest result (275) (0.9%) (203) (0.7%) Other finan
Slide 12: Hedge Policy; 2005: Upgrading Guidance
Hedge Policy Approx. half of EADS US$ revenues are naturally hedged by US$ procurement Æ In 2004 the annual net exposure was around $ 11bn (including $ 9 bn for Airbus). . EADS hedge portfolio (US$ 40.2 bn) on Dec., 31st 2004 US$ bn average rate 1 € = 1.03 $ 12 10.9 10 8.7 8 7.2 6.7 6 5.0 4 2 1.3 0.
Slide 13: Reaping the benefits of good work
Content 2000 2004: The Step Beyond 2004 performance by division 2004 Financials Roadmap 25 Reaping the benefits of good work EBIT* margin 7.7% 5.8% 5.5% 5.1% 4.8% 2000 2001 2002 2003 2004 • Integration: Airbus SAS, MBDA, Astrium • Restructuring: € 1 bn charged since 2001 (€ 129 m in 2004) • Efficien
Slide 14: Commercial Aviation: Sustain the Leadership
Commercial Aviation: Sustain the Leadership • Leadership in deliveries, orders and innovation 100% 90% Units ordered EC145 manufacturers' shares - %orders 80% Boeing 70% AS365N3 60% 43% 59% 50% 50% 40% MDD 57% 30% 22% 20% A350 10% AIRBUS 0% 19% 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 0
Slide 15: Defence: Go beyond boundaries; Space: Sustain long-term development
Defence : Go beyond boundaries • Tripled the order-book A310/A330 • Towards € 10 bn revenues Air Tanker - MRTT Skynet 5 EADS defence revenues in € million 10,000 UAV 8,500 7,098 7,695 NH90 6,100 6,040 2001 2002 2003 2004 e2005 e2006/07 How to go beyond ? Extend product range Expand outside Europe 29
Slide 16: Continuing the Transformation
Continuing the Transformation • Industrial leader • Solid financials • Recognised as a Model Russia Japan USA South Korea China India Australia How to go beyond ? Global Industrial Strategy Innovation People 31 Appendix 32 16
Slide 17: 2004 Highlights: EBIT* margin up to 7.7%; Q4 Key Figures
2004 Highlights: EBIT* margin up to 7.7% in m€ FY 2004 FY 2003 Change Revenues 31.8 € bn 30.1 € bn + 5.4% of which Defence 7.7 € bn 7.1 € bn + 8.4% EBIT* 2.4 € bn 1.5 € bn + 58.4% FCF before Cust. Financing ** 1.8 € bn 2.1 € bn (15.9%) Net income 1.0 € bn 0.6 € bn *** + 59.9% New orders 44.1 € bn 61
Slide 18: Balance Sheet Highlights; EBIT* Calculation
Balance Sheet Highlights in € m Dec. 2004 Dec. 2003 Assets 58,267 54,378 of which Goodwill 9,460 9,372 of which cash & equivalents, securities 9,184 7,872 of which positive hedge mark-to-market 8,948 7,964 Stockholders' equity 16,973 16,149 of which OCI (Other Comprehensive Income) 6,086 5,934 Minor
Slide 19: Restructuring Items in EBIT*; Net Cash Position
Restructuring, write-off and disposal items included in EBIT* €m FY 2004 FY 2003 EBIT* 2,444 1,543 EBIT* margin (% of revenues) 7.7% 5.1% EADS EBIT* includes the following items MTA Restructuring (28) (17) Aeronautics Restructuring (Sogerma) (13) (7) Space Restructuring 0 (288) Asset Depreciation 0
Slide 20: Net Income pre-exceptionals; A380 R&D and Capex
Net Income pre-exceptionals in € m Dec. 2004 Dec. 2003 Net Income 1,030 644** EPS (based on Net Income) 1.29 € 0.80 € Exceptionals: Fair value adjustment on fixed assets 212 214 Fair value adjustment on inventories 5 15 Tax impact on exceptional fair value (78) (83) Minorities on exceptional fair va
Slide 21: Customer Financing Exposure; Quarterly Revenues Breakdown
Customer Financing Exposure all figures in € m Figures for 100% Airbus 2004 2003 closing rate € - $ 1.36 1.26 Total Gross exposure* 3,348 3,822 of which off-balance sheet 604 724 Estimate value of collateral (1,916) (2,229) Net exposure 1,432 1,593 Provision and deferred margin (1,432) (1,593) AIRBU
Slide 22: Quarterly EBIT* and Order-intake Breakdown
Quarterly EBIT* Breakdown (cumulative) Q1 Q2 Q3 Q4 in €m 2004 2003 2004 2003 2004 2003 2004 2003 Airbus 224 166 982 621 1,382 701 1,922 1,353 MTA (8) (11) (10) (8) 5 (7) 26 30 Aeronautics 10 16 56 59 116 112 206 217 Space (11) (21) (11) (131) (5) (184) 10 (400) DS (51) (54) (82) (28) (75) (18) 228 1
Slide 23: Quarterly Order-book Breakdown
Quarterly Order-book Breakdown Q1 Q2 Q3 Q4 in €m 2004 2003 2004 2003 2004 2003 2004 2003 Airbus 140,911 134,615 139,655 154,428 138,747 153,302 136,022 141,836 MTA 19,980 677 19,904 20,476 19,738 20,429 19,897 20,007 Aeronautics 10,021 10,193 9,991 9,828 10,656 9,719 10,171 9,818 Space 8,083 4,401 1