European aerospace and defence giant Airbus has launched a “transformation” of its Defence and Space division as Q3 results revealed that revenues in the segment decreased by 6%, driven mainly be a “backloaded” delivery profile of its A400M military airlifter.
The company delivered four A400M aircraft in the reporting period, compared to seven in 2022, while Airbus Defence and Space’s order intake by value was €8.5bn ($9.1bn), including the renewal of the in-service support contract for Germany’s A400M fleet.
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Earnings before interest and taxes at Airbus Defence and Space decreased to negative €1m, including charges of €400m related to updated estimates at completion of satellite development programmes, mostly recorded in the third quarter.
On the A400M programme, the company’s results detailed that development activities “continue towards achieving the revised capability roadmap”, while retrofit activities were progressing “in close alignment with the customer”.
Risks remain on the A400M programme on the qualification of technical capabilities and associated costs, aircraft operational reliability, cost reductions, and securing overall volume as per the revised baseline.
According to Airbus the “transformation” of its Defence and Space business area, a result of “an evolving defence and security environment”, is intended to “adapt ways of working”, to focus on “rigorous programme execution” and a rebalancing of risks to “reinforce end-to-end accountability and ownership in the business lines and improve competitiveness”.
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By GlobalDataAcross the company as a whole, Q3 2023 revenues increased by 12%, mainly reflecting the higher commercial aircraft deliveries, partly offset by the lower contribution from the Airbus Helicopters and Airbus Defence and Space divisions, in particular by the reduced helicopter deliveries.
GlobalData states that during the Q2 report by Airbus in July this year, the company’s results was given a 0.42 sentiment rating.
Further analysis by GlobalData, reported in October this year, indicates that in Q3 2023 the average sentiment dropped from 0.68 to 0.67, indicating a more negative outlook for the industry. This followed an 11% quarter-on-quarter increase in Q2 2023.
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