Slide 1: 9-month 2003 Results
9-month 2003 Results Hans Peter Ring, CFO Analysts Conference call – November 6th, 2003 1 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain of the statements contained in this document are not historical facts but rather are statements of future expectations and other forward-looking statements that are based on management‘s beliefs. These statements reflect the Company‘s views and assumptions as of the dat
Slide 3: Content
Content 1. Group overview 2. Operating performance by division 3. Financials 3 3
Slide 4: 9-month 2003 EADS results
9-month 2003 EADS results • On-track with plan • EBIT margin pre R&D = 12.7% • Positive Net Cash position • Order-book: world-wide largest fast growing 4 4
Slide 5: Resilient and Robust Business
Resilient and Robust Business Flexible, Tough Financial Management … • Hedging: net additions of $ 5bn => Total portfolio $45bn at avg. €=0.98 $ • Financing: new bond issue to ensure competitive and flexible access to financial markets, contain customer financing • Restructuring: space restructuring
Slide 6: Defence businesses improvement, Airbus resilience
Defence businesses improvement, Airbus resilience A380 R&D Airbus* Aeronautics HQ Space excl. A380 MTA (266) DS • A380 peak (83) 101 • Restructuring • Astrium 100% (105) 124 HQ first time Deliveries Defence improvement consolidation decrease partly 1,013 programs and offset by mix delivery higher re
Slide 7: Continuing EADS growth momentum
Continuing EADS growth momentum Commercial Defence aviation 7.0 6.9 years years 5.0 5.1 5.0 years years years Space and other 3.7 commercial years 1.2 1.3 1.3 years years years as of Dec. 02 as of June 03 as of Sept.03 Orderbook times 2002 revenues, except for Airbus (times deliveries) 7 7
Slide 8: 9-month Financial Highlights
9-month Financial Highlights in m€ 9m 2003 9m 2002 Revenues 18,536 € m 19,996 € m EBIT* 784 € m 1,013 € m EBIT pre-R&D expenses 2,345 € m 2,369 € m FCF before Cust. Financing** (92 € m) (204 € m) New orders 49,453 € m 22,341 € m in bn€ Sept. 2003 Dec. 2002 Net Cash position 0.4 € bn 1.2 € bn Total O
Slide 9: Content
Content 1. Group Overview 2. Operating Performance by Division 3. Financials 9 9
Slide 10: Airbus
Airbus €m 9m 2003 9m 2002 • 9-mth EBIT pre-R&D nearly stable at €2.0 bn despite lower Deliveries 199 219 deliveries: Revenues 12,051 13,750 ¾ Productivity improvement R&D self-financed 1,308 1,071 ¾ Better mix in % of revenues 10.9% 7.8% EBIT* • EBIT-margin pre-R&D = 16.7% 701 1,072 in % of revenues
Slide 11: Customer Financing Exposure under control
Customer Financing Exposure under control all figures in € m Figures for 100% Airbus Sept. 2003 Dec. 2002 closing rate $/€ 1.165 1.049 Total Gross exposure* 3,689 3,581 of which off-balance sheet 784 891 Estimate value of collateral (2,139) (2,062) Net exposure 1,550 1,519 Provision (1,550) (1,519)
Slide 12: MTA
MTA €m 9m 2003 9m 2002 • Revenues growth triggered by Revenues 410 310 military derivatives R&D self-financed 15 28 in % of revenues 3.7% 9.0% • EBIT improvement EBIT* expected to continue with A400M (7) (79) ** ramp up. EBIT Positive in Q3 Order book 20,429 1,258 * pre goodwill and exceptionals • O
Slide 13: Aeronautics
Aeronautics (new format : excl. Military aircraft) 9m 2002 €m 9m 2003 Pro-forma • EBIT improvement driven by Tiger and NH90 Revenues 2,452 2,440 • Eurocopter: Defence export R&D self-financed 50 66 in % of revenues 2.0% 2.7% successes : EBIT* 112 84 • Greece commits to 20 NH90 in % of revenues 4.6%
Slide 14: Space
Space (Astrium 100% consolidated from January 2003) €m 9m 2003 9m 2002 • Revenues: Astrium consolidation change (+€244m) and launcher Revenues 1,473 1,389 business decrease R&D self-financed 39 36 • EBIT hit by: Restructuring (€88m) in % of revenues 2.6% 2.6% and program provision (€76m) EBIT* (184)
Slide 15: Defence and Security Systems
Defence and Security Systems (New format : incl. Military Aircraft) 9m 2002 €m • Revenue : 6% growth due to 9m 2003 Pro-forma ramp-up of Missiles +9% Revenues 2,957 2,793 and Military Aircraft +12% R&D self-financed 149 154 • EBIT improvement triggered in % of revenues 5.0% 5.5% by Defence programs
Slide 16: Content
Content 1. Group overview 2. Operating performance by division 3. Financials 16 16
Slide 17: Profit & Loss Highlights
Profit & Loss Highlights 9m 2003 9m 2002 in % of in % of €m Revenues €m Revenues Revenues 18,536 19,996 self-financed R&D 1,561 8.4% 1,356 6.8% EBITDA 1,877 10.1% 2,134 10.7% EBIT* 784 4.2% 1,013 5.1% EBIT* before R&D 2,345 12.8% 2,369 11.8% Interest result (138) (0.7%) (77) (0.4%) Taxes (208) (1.1%
Slide 18: Development of Net Cash
Development of Net Cash in € m 9m 2003 9m 2002 Net cash at the beginning of the period 1,224 1,533 Gross Cash Flow from Operations* 1,099 1,207 Change in working capital 183 (78) Cash used for investing activities** (2,003) (1,751) of which Industrial Capex (additions)*** (1,328) (1,414) of which Cu
Slide 19: Continuing hedge policy
Continuing hedge policy Approx. 50% of EADS US$ revenues are naturally hedged by US$ procurement Æ at the level of 300a/c a year annual net exposure is in the range of $10bn EADS hedge portfolio (US$ 44.6 bn) as of Sept. 30, 2003 US$ bn Volume already hedged 12 9.7 10 8.1 7.6 8 6.0 6 5.1 3.6 3.0 4 2
Slide 20: Remain solid and Enhance growth
Remain solid and Enhance growth • Confirm 2003 Targets 9 300 deliveries; Revenues in same range as 2002, based on 1€ = 1.10 $ 9 EBIT* in same range as 2002 9 Free Cash Flow positive pre-customer financing 9 Restrictive customer financing • Homework on track: Space restructuring, continuing $hedge, p
Slide 21: Appendix
Appendix 21 21
Slide 22: Balance Sheet Highlights
Balance Sheet Highlights Sept. Dec. in € m 2003 2002 Assets 51,324 47,400 of which Goodwill 9,415 9,586 of which cash & equivalents, securities 6,300 6,200 of which positive hedge mark-to-market 5,907 2,819 Stockholders' equity 14,536 12,765 of which OCI (Other Comprehensive Income) 4,587 2,452 Mino
Slide 23: EBIT* Calculation
EBIT* Calculation Sept. Sept. in € m 2003 2002 Result before financial inc. and 54 368 income tax Income from investments ** 137 42 Exceptionals: Goodwill amortisation 422 431 Fair value adjustment 171 172 EBIT* 784 1,013 * pre goodwill and exceptionals ** incl. Dassault-Aviation contribution for €
Slide 24: Restructuring, Write-off and Disposal Items Included in EBIT*
Restructuring, Write-off and Disposal Items … Included in EBIT* €m 9m 2003 9m 2002 EBIT* 784 1,013 EBIT* margin (% of revenues) 4.2% 5.1% EADS EBIT* includes the following items Airbus Aircelle disposal - 63 MTA Asset depreciation - (54) DS Restructuring (22) - Space Restructuring (88) - Asset Depre
Slide 25: Elements of EADS Net Cash
Elements of EADS Net Cash in m€ Sept. 2003 Dec. 2002 Gross cash 6,300 6,200 Financial Debts (5,941) (4,976) Reported Net cash position 359 1,224 Debts backed by deposit 1,148 1,146 Non-recourse debt 647 749 Net cash position excl. total 2,154 3,119 non-recourse Main minority impact* 427 177 Airbus 2
Slide 26: Net Income pre Goodwill and Exceptionals
Net Income pre Goodwill and Exceptionals Sept. Sept. in € m 2003 2002 Net Income (124) 23 Goodwill amortisation 422 431 Exceptionals: Fair value adjustment on fixed assets 160 163 Fair value adjustment on inventories 11 9 Tax impact on exceptional fair value (61) (62) Minorities on exceptional fair
Slide 27: A380 On-going in Line With Plan
A380 On-going in Line With Plan Self-financed R&D expensed by quarter in € m 740 650 628 528 548 445 473 480 485 412 403 450 356 322 Cumulative 262 273 193 228 A380 R&D 250 126 150 154 93 101 64 = 2.0 €bn 50 Q1 2001 Q2 2001 Q3 2001 Q4 2001 Q1 2002 Q2 2002 Q3 2002 Q4 2002 Q1 2003 Q2 2003 Q3 2003 A380
Slide 28: Quarterly figures Q3 2003
Quarterly figures Q3 2003 : All divisions but Space turn to positive EBIT in € bn Q3 2003 Q3 2002 Revenues 5.5 € bn 6.0 € bn EBIT* 0.2 € bn 0.2 € bn FCF before cust. financing** (0.4 € bn) (0.4 € bn) New orders 6.3 € bn 7.6 € bn * pre goodwill and exceptionals ** excl. investments in medium term sec
Slide 29: Quarterly Revenues Breakdown (Cumulative)
Quarterly Revenues Breakdown (Cumulative) Q1 Q2 Q3 Q4 in €m 2003 2002 2002 2002 2002 new format* new format* 2003 new format* 2003 new format* 2003 new format* Airbus 3,775 4,646 8,773 9,870 12,051 13,750 19,512 MTA 96 101 268 234 410 310 524 Aeronautics* 686 673 1,613 1,606 2,452 2,440 3,834 Space
Slide 30: Quarterly EBIT* Breakdown (Cumulative)
Quarterly EBIT* Breakdown (Cumulative) Q1 Q2 Q3 Q4 in €m 2003 2002 2002 2002 2002 new format** new format** 2003 new format** 2003 new format** 2003 new format** Airbus 166 396 621 874 701 1,072 1,361 MTA (11) (12) (8) (72) (7) (79) (80) Aeronautics** 16 5 59 29 112 84 180 Space (21) (33) (131) (85)
Slide 31: Quarterly Order-intake Breakdown (Cumulative)
Quarterly Order-intake Breakdown (Cumulative) Q1 Q2 Q3 Q4 in €m 2003 2002 2002 2002 2002 new format* new format* 2003 new format* 2003 new format* 2003 new format* Airbus 3,416 1,261 33,174 10,334 37,028 15,446 19,712 MTA 122 61 20,104 214 20,195 290 403 Aeronautics* 706 1,286 1,440 1,982 2,213 2,73
Slide 32: Quarterly Order-book Breakdown
Quarterly Order-book Breakdown Q1 Q2 Q3 Q4 in €m 2003 2002 2002 2002 2002 new format* new format* 2003 new format* 2003 new format* 2003 new format* Airbus 134,615 151,794 154,428 145,500 153,302 148,898 140,996 MTA 677 1,295 20,476 1,283 20,429 1,258 633 Aeronautics* 10,193 10,560 9,828 10,336 9,71