Airbus SE Q1 2023 Earnings Call
Speaker 1: Yeah
Operator: Ladies and gentlemen, thank you for standing by. Welcome to the Airbus Q1 2023 Results Release Conference Call. I am Sharon, the operator for this conference. Please note that for the duration of the presentation, all participants will be in a listen-only mode, and the conference is being recorded. After the presentation, there'll be an opportunity to ask questions. At this time, I would like to turn the conference over to your host, Guillaume Faury, Xavier Tardy, and Hélène Le Gorgeu. Please go ahead.
Speaker 2: Ladies and gentlemen, thank you for standing by. Welcome to the Airbus Q1 2023 results release conference call. I am Sharon, the operator for this conference. Please note that for the duration of the presentation, all participants will be in a listen-only mood and the conference is being recorded.
Speaker 2: After the presentation, there'll be an opportunity to ask questions. At this time, I would like to turn the conference over to your hosts, Guillaume Fori, Xavier Tardy, and Hélène Le Gorgiou. Please go ahead.
Hélène Le Gorgeu: Thank you, Sharon, and good evening, ladies and gentlemen. This is the Airbus Q1 2023 Results Release Conference Call. Guillaume Faury, our CEO, and Xavier Tardy, our interim CFO, will be presenting our results and answering your questions. This call is planned to last around 1 hour. This includes Q&A, which we will conduct after the presentation. This call is also webcast. It can be accessed via our homepage by clicking on the dedicated banner. Playback of this call will be accessible on our website, but there is no dedicated phone replay service. The supporting information package was published on our website earlier today. It includes the slides, which we will now take you through, as well as the financial statement.
Speaker 3: Thank you Sharon and good evening ladies and gentlemen.
Speaker 3: This is the Airbus Q1 2020 Free Results Release Conference Call.
Speaker 3: Guillaume Faurie, our CEO and Xavier Tarbi, our Interim CFO , will be presenting our results and answering your questions.
Speaker 3: This call is planned to last around an hour. This includes Q&A, which we will conduct after the presentation.
Speaker 3: This call is also webcast. It can be accessed via our homepage by clicking on the dedicated banner.
Speaker 3: Playback of this call will be accessible on our website, but there is no dedicated phone replay service.
Speaker 3: The supporting information package was published on our website earlier today. It includes the slides, which we will now take you through, as well as the financial statement.
Hélène Le Gorgeu: Throughout this call, we will be making forward-looking statements. I invite you to refer to our safe harbor statement that appears in the presentation slide and applies to this call as well. Please read it carefully. Now over to you, Guillaume.
Speaker 3: Throughout this call we will be making forward-looking statements.
Speaker 3: I invite you to refer to our safe harbor statement that appears in the presentation slide and applies to this call as well. Please read it carefully. And now over to you Guillaume.
Guillaume Faury: Thank you, Hélène. Hello, ladies and gentlemen. Thank you for joining us today for our Q1 2023 results call. I'm happy to be here in Amsterdam with Xavier, who acts as our interim Chief Financial Officer prior to Thomas Toepfer's arrival in September, and Hélène, our Head of Investor Relations, who you know well and you just heard. We will now run you through our results. During our full year result call less than three months ago, we highlighted the strong demand in all areas of our business, and particularly for commercial aircraft. We also mentioned that we expected to continue operating in an adverse environment. This has been confirmed in Q1. On one hand, our customers continue to express a strong appetite for our product portfolio, as highlighted by the recent announcements from Air India.
Speaker 4: Thank you, Hélène. And hello, ladies and gentlemen. Thank you for joining us today for Q1 2023 results call.
Speaker 4: I'm happy to be here in Amsterdam with Xavier who acts as our Interim Chief Financial Officer prior to Thomas Topf's arrival in September and Hélène, our Head of Investor Relations, who you know well and you just heard.
Speaker 4: We will now run you through our results.
Speaker 4: During our full year result call less than three months ago, we highlighted the strong demand in all areas of our business, and particularly for commercial aircraft. We also mentioned that we expected to continue operating in an adverse environment. This has been confirmed in Q1.
Speaker 4: On one hand our customers continue to express a strong appetite for product portfolio as highlighted by the recent announcement from Air India. On the other hand we observe the geopolitical situation which remains complex and tabulances in the banking sector.
Guillaume Faury: On the other hand, we observe the geopolitical situation, which remains complex, and turbulences in the banking sector. When it comes to the supply chain, we continue to observe persisting tensions across the sector in many areas such as labor, raw materials, engines, as well as a range of buyer-furnished equipment, for example, seats. Here, I'd like to remind you that the delivery profile is planned to be backloaded this year. In Q1, we delivered 127 aircraft, roughly in line with our plan. This is reflected together with the good performance of our helicopter division in our EBIT Adjusted that stood at €8.8 billion. Our free cash flow before M&A and customer financing was minus €0.9 billion, consistent with the necessary inventory built up as we execute our ramp up, and consistent with the number of deliveries.
Speaker 4: When it comes to the supply chain, we continue to observe persisting tensions across the sector in many areas, such as labor, raw materials, engines, as well as a range of bio-furniture equipment, for example, seats.
Speaker 4: Here I'd like to remind you that the delivery profile is planned to be backloaded this year.
Speaker 4: In Q1 we delivered 127 aircraft, roughly in line with our plan.
Speaker 4: This is reflected together with a good performance of our helicopter division in our EBIT adjusted that stood at 0.8 billion euros.
Speaker 4: Our free cash flow before M&M customer financing was minus 0.9 billion euro consistent with the necessary inventory built up as we execute our ramp up and consistent with the number of deliveries.
Guillaume Faury: As announced during the full year of 2022 results, we target to deliver around 720 aircraft in 2023. We keep our full year 2023 guidance unchanged. Let's now look at our commercial environment. During the Q1, our global air traffic continued to improve, driven by the acceleration of domestic and regional markets that are now trending close and sometimes above previous levels, while international traffic continues to be paced by the reopening of China. By the way, I was delighted to be there in China a few weeks ago for the first time since 2019, and I was quite impressed with the strong momentum and energy I observed. Airlines are now gearing up for a busy summer season ahead, as indicated by the current level of advanced bookings, in spite of inflationary pressures and higher fuel prices.
Speaker 4: As announced during the full year 2022 results, we target to deliver around 720 aircraft in 2023. We keep our full year 2023 guidance.
Speaker 4: unchanged.
Speaker 4: Let's now look at our commercial environments.
Speaker 4: During the first quarter, global air traffic continued to improve, driven by the acceleration of domestic and regional markets that are now trending close and sometimes above previous levels, while international traffic continues to be paced by the reopening of China.
Speaker 4: And by the way, I was delighted to be there in China a few weeks ago for the first time since 2019 and I was quite impressed with the strong momentum and energy I observed.
Speaker 4: Airlines are now gearing up for a busy summer season ahead, as indicated by the current level of advanced bookings, in spite of inflationary pressures and higher fuel prices.
Guillaume Faury: Our new generation aircraft are and remain in high demand as customers continue to be actively engaged into fleet planning to fill the skyline in the years to come. Let me remind you of our orders and backlog in Q1. We booked a total of 156 gross orders and recorded 14 cancellations. As a result, net orders were positive at 142 aircraft and our backlog in units amounted to 7,254 aircraft at the end of March 2023, including 6,075 A320 family aircraft. Looking at helicopters, in Q1 2023, we booked 39 net orders versus the 56 in Q1 2022, and the bookings in 2023 were well spread across programs. We are honored, GDAT, one of our Chinese customers, has decided last month to bolster their fleet with 50 civil H160s. This contract is the largest single order for the program on the civil and parapublic market.
Speaker 4: Our new generation aircrafts remain in high demand as customers continue to be actively engaged into fleet planning to fill the skyline in the years to come.
Speaker 4: Let me remind you of our orders and backlog in Q1. We booked a total of 156 gross orders and recorded 14 cancellations. As a result net orders were positive at 142 aircraft and our backlog in units...
Speaker 4: amounted to 7,254 aircraft at the end of March 2023 including 6,075 A320 family aircraft.
Speaker 4: Looking at helicopters, in Q1 23 we booked 39 net orders versus the 56 in Q1 2022. And the bookings in 2023 were well spread across programmes.
Speaker 4: We are honored... sorry, we are honored...
Speaker 4: GDAT, one of our Chinese customers, has decided last month to bolster their
Guillaume Faury: This order is not yet reflected in our order book as of the end of March 2023. In addition, we continue to see positive momentum in home countries for both civil and military markets. Finally, in Defense and Space, the conflict in Ukraine has highlighted the essential role that Defense and Space plays for society and the importance for European nations to support their security and defense industry. We started the year with a good order intake of EUR 2.5 billion in Q1 2023. The extensive use of our military aircraft across the portfolio is reflected by the good order momentum in services. We also received an order for an additional MRTT, which is showing its capabilities as a multi-role tanker since its arrival in the NATO fleet in 2020. In space systems, despite a difficult environment, our Q1 orders highlight the strength of our products.
Speaker 4: This contract is the largest single order for the program on the civil and parapublic market.
Speaker 4: This order is not yet reflected in our order book as of the end of March 2023.
Speaker 4: In addition, we continue to see positive momentum in home countries for both civil and military markets.
Speaker 4: Finally, in distance and space.
Speaker 4: The conflict in Ukraine has highlighted the essential role that distance and space plays for society and the importance for European nations to support their security and defense industry. We started the year with a good order intake of 2.5 billion euros in Q1 23.
Speaker 4: The extensive use of our military aircraft across the portfolio is reflected by the good order momentum in services.
Speaker 4: We also received an order for an additional MRCT, which is showing its capabilities as a Milky role tanker since its arrival in the NATO fleet in 2020.
Guillaume Faury: We recently booked the so-called Slice 2 of the order for the European Service Module, the ESM-4, ESM-5, and ESM-6 of the Orion spacecraft. ESM is an integral part of the Artemis mission and is powering humankind's return to the moon. In April, an Ariane 5 successfully launched the Airbus designed and built Jupiter Icy Moons Explorer, or JUICE, for its eight-year journey to Jupiter. This demonstrates what the best of Europe can deliver when it comes together. By the way, this means that there is only one Ariane 5 launch left before transitioning to Ariane 6. Before moving to financials, let me give you a quick update on two strategic future programs. On FCAS Demonstrator Phase 1B, the signature of which was celebrated last Friday by the defense ministers of France, Germany, and Spain.
Speaker 4: In space systems, despite a difficult environment, our Q1 orders highlight the strength of our products.
Speaker 4: We recently booked the so-called Slice 2 of the order for the European Service Module, the ESM 4, 5 and 6 of the Orion spacecraft. ESM is an integral part of the Artemis mission and is powering humankind's return to the Moon.
Speaker 4: In April , the 905 successfully launched the Airbus design and build.
Speaker 4: Jupiter IC Moons Explorer or JUIS for its 8-year journey to Jupiter. This demonstrates what the best of Europe can deliver when it comes together.
Speaker 4: By the way this means that there is only one iron 5 launch left before
Speaker 4: Before moving to financials, let me give you a quick update on two strategic future programs.
Guillaume Faury: This FCAS Demonstrator Phase 1B is now in progress, paving the way for the in-flight demonstrations phases. In the Eurodrone program, we continue to progress and carefully build up what will facilitate the preliminary design review, so-called PDR, in H2 of this year. Xavier will take you through our financials. Xavier, the floor is yours.
Speaker 4: Demonstrator Phase 1B, the signature of which was celebrated last Friday by the defense ministers of France, Germany and Spain.
Speaker 4: This FCAS Demonstrator Phase 1b is now in progress, paving the way for the in-flight Demonstrations Phase.
Speaker 4: In the Eurodrome program we continue to progress and carefully build up what will facilitate the preliminary design review, so called PDR, in the second half of this year.
Xavier Tardy: Thank you, Guillaume, and hello, ladies and gentlemen. Our Q1 2023 revenue slightly decreased to €11.8 billion, mainly reflecting the lower number of commercial aircraft deliveries and partly offset by a higher contribution from our helicopters division. Our Q1 2023 EBIT Adjusted decreased to €0.8 billion from €1.3 billion in Q1 2022. Q1 2022 included a net €0.2 billion positive impact from non-recurring elements related to retirement obligations and to international sanctions against Russia. The year-on-year decrease in our EBIT Adjusted also reflects the lower commercial aircraft deliveries, a slightly less favorable hedge rate versus Q1 2022, as well as investments for preparing the future. On R&D, our expenses in Q1 2023 stood at €0.7 billion versus €0.6 billion in Q1 2022. We continue to expect our full year R&D to slightly increase compared to last year.
Speaker 5: No.
Speaker 4: Xavier will take you through our financials. Xavier, the floor is yours.
Speaker 6: Thank you Guillaume and hello ladies and gentlemen.
Speaker 6: Our Q1 2023 revenues slightly decreased to 11.8 billion euros.
Speaker 6: many reflecting the lower number of commercial aircraft deliveries and partly offset by a higher contribution from our helicopter division.
Speaker 6: Our Q1 2023 EBIT adjusted decreased to 0.8 billion euros from 1.3 billion euros in Q1 2022.
Speaker 6: Q1 2022 included the net 0.2 billion euros positive impact from non-recurring elements related to retirement obligations and to international sanctions against Russia.
Speaker 6: The year-on-year decrease in our edit adjusted also reflects the lower commercial aircraft deliveries, a slightly less favorable hedge rate versus Q1 2022 as well as investments for preparing the future. On R&D our expenses in Q1 2023
Xavier Tardy: Our Q1 EPS adjusted stood at EUR 0.72, based on an average of 788 million shares. Our Q1 free cash flow before M&A and customer financing was EUR -0.9 billion, mainly reflecting deliveries and the necessary inventory buildup as we execute our ramp-up. Onto the next slide regarding our profitability. Q1 2023 EBIT reported was EUR +0.5 billion. The level of EBIT adjustments total a net EUR -0.4 billion, including a -360 negative impact from FX mismatch and balance sheet revaluation, mainly reflecting the mechanical impact coming from the difference between transaction date and delivery date, EUR -9 million related to the Aerostructures transformation, and EUR -14 million of other costs, including compliance costs. EPS reported includes EUR +149 million of financial results.
Speaker 6: 772 euros based on an average of 788 million shares.
Speaker 6: Our Q1 free cash flow before M&A and customer financing was minus 0.9 billion euros, many reflecting deliveries and the necessary inventory buildup as we execute our ramp-up.
Speaker 6: Now, on to the next slide regarding our profitability.
Speaker 6: Q1 2023 EBIT reported was plus 0.5 billion euros.
Speaker 6: The level of EBIT adjustments total a net negative 0.4 billion euros including
Speaker 6: minus 360 negative impact from FX mismatch and balance sheet reevaluation.
Speaker 6: coming from the difference between transaction date and delivery date.
Speaker 6: minus 9 million euros related to the arrow structures transformation, and minus 14 million euros of other costs, including compliance costs. ETS reported includes plus 149 million euros of financial results.
Xavier Tardy: It mainly reflects the positive impact from the revaluation of certain equity investments, partly offset by negative impacts coming from the revaluation of financial instruments and the net interest result. The tax rates on the core business continues to be around 27%. The effective tax rate on net income is 19%, including the tax effect on the revaluation of certain equity investments. The resulting net income is €0.5 billion, with earnings per share reported of €0.59. Now, regarding our USD exposure coverage. In Q1 2023, $3.7 billion of forwards matured with associated EBIT impact and euro conversions realized at a blended rate of $1.22 versus $1.21 in Q1 2022. In Q1 2023, we also implemented $2.8 billion of new coverage at a blended rate of $1.10.
Speaker 6: It mainly reflects the positive impact from the revaluation of certain equity investments.
Speaker 6: partly offset by negative impacts coming from the revaluation of financial instruments and the net interest result.
Speaker 6: The tax rate on the core business continues to be around 27%.
Speaker 6: The effective tax rate on net income is 19%, including the tax effect on the revaluation of certain equity investments.
Speaker 6: The resulting net income is €0.5 billion with earnings per share reported of €0.59.
Speaker 6: Now, regarding our USD exposure coverage.
Speaker 6: In Q1 2023, $3.7 billion of forwards matured with associated EBIT impact and Euro conversions realized.
Speaker 6: at the blended rate of $1.22 in Q1 2022.
Speaker 6: In Q1 2023, we also implemented $2.8 billion of new coverage
Xavier Tardy: As a result, our total USD coverage portfolio in US dollars stands at $93 billion, with an average blended rate of $1.24, compared to $93.9 billion at $1.24 at the end of 2022. As announced during the full-year disclosure, we adjusted our portfolio through rollovers to reflect the adapted ramped trajectory and our delivery target for 2023. Now, onto a more detailed look at the free cash flow. Our free cash flow before M&A and customer financing was EUR -0.9 billion in Q1 as we continue to focus on ramp-up. This outflow was mainly driven by the change in working capital and largely reflects a mechanical inventory buildup resulting from the execution of our ramp-up plan and from lower wide-body deliveries.
Speaker 6: at a blended rate of 1.10 dollars.
Speaker 6: As a result, our total USD coverage portfolio in USD stands at $93 billion.
Speaker 6: with an average blended rate of $1.24.
Speaker 6: compared to $93.9 billion at 1.24 at the end of 2022.
Speaker 6: As announced during the full year disclosure, we addressed their portfolio through rollovers to reflect the adapted ramp-up trajectory and our delivery targets for 2023.
Speaker 6: Now, onto a more detailed look at the free cash flow.
Speaker 6: Our free cash flow before M&A and customer financing was minus 0.9 billion euros in the first quarter, as we continue to focus and ramp up.
Speaker 6: This outflow was mainly driven by the change in working capital and largely reflects a mechanical inventory build-up resulting from the execution of our ramp-up plan and from lower widebody deliveries.
Xavier Tardy: The A400M continued to weigh on our free cash flow before M&A, but less so than in Q1 2022. Our Q1 2023 CapEx was around -€0.5 billion versus -€0.3 billion in Q1 2022. We expect our CapEx to slightly increase in 2023, supporting our industrial ramp-up. Free cash flow was -€0.9 billion, with nearly no impact from M&A and customer financing. The aircraft financing environment remains solid, with sufficient liquidity in financial markets for our products. However, this low level of customer financing activity might not be sustainable. Our net cash position stood at €8.4 billion as of the end of March, and our liquidity remains above €30 billion. Now back to you, Guillaume.
Speaker 6: The A400M continued to weigh on our free cash flow before M&A, but less so than in Q1 2022.
Speaker 6: Our Q1 2023 capex was around minus 0.5 billion euros.
Speaker 6: versus minus 0.3 billion euros in Q1 2022.
Speaker 6: And we expect our capex to slightly increase in 2023, supporting our industrial ramp-up.
Speaker 6: Free cash flow was minus 0.9 billion euros.
Speaker 6: with nearly no impact from M&A and customer financing.
Speaker 6: the aircraft financing environment remains solid.
Speaker 6: with sufficient liquidity in financial markets for our products.
Speaker 6: However, this low level of customer financing activity might not be sustainable.
Speaker 6: Our net cash position stood at 8.4 billion euros as of the end of March.
Guillaume Faury: Thank you, Xavier. Very clear. On to commercial aircraft. In Q1 2023, we delivered 127 aircraft to 54 customers. After a slow start in deliveries at the beginning of the year, we delivered 61 aircraft in March. Looking at the Q1 2023 situation by aircraft family, on A220, we delivered 10 aircraft, and we continue to ramp up to reach rate 14 by middle of the decade. On A320, we delivered 106 aircraft, of which 59 A321s. This included the first A321 from our FAL in China. The first FAL, of course, not yet the second one. We continue to ramp up towards a production rate of 65 aircraft by the end of 2024 and 75 in 2026. No change. I was happy to announce a few weeks ago our decision to add a second FAL in Tianjin.
Speaker 6: and our liquidity remains above 30 billion euros.
Speaker 4: Now back to you Guillaume. Thank you Xavier, very clear. On to commercial aircrafts. In Q1 2023 we delivered 127 aircraft to 54 customers.
Speaker 4: After a slow start in deliveries at the beginning of the year, we delivered 61 aircraft in March.
Speaker 4: Looking at the Q123 situation by aircraft family, on A220 we delivered 10 aircraft and we continue to ramp up to a rate of 14 by the middle of the decade.
Speaker 4: On A320 we delivered 106 aircraft of which 59 A321s
Speaker 4: This included the first A321 from our file in China.
Speaker 4: The first part of course.
Speaker 4: part of course. Now check this thing on one.
Speaker 4: We continue to ramp up towards a production rate of 65 acres by the end of 2024 and 75 in 2026.
Guillaume Faury: This will increase our global A320 family industrial capacity up to 10 final assembly lines, supporting Airbus to reach its commitment to produce 75 aircraft per month. On the XLR, the flight test program is progressing towards entering into service, expected to take place in Q2 2024. No change. On wide-body, we delivered 11 aircraft in Q1, of which six A330 and five A350s. As previously announced, we target rate four in 2024 on the A330 and rate nine on the A350 at the end of 2025. On the A350 freighter, the first components were recently produced by Airbus Atlantic in Nantes. As the first milestones are reached, we are now slightly adjusting our industrial planning for this variant, with the entry into service now slipping into early 2026. Slight change. Let's look at Airbus commercial financials for Q1.
Speaker 4: I was happy to announce a few weeks ago our decision to add a second filing changing. This will increase our global FK20 family industrial capacity up to 10 final assembly lines, supporting Airbus to reach its commitment to produce 75 aircraft per month.
Speaker 4: On the XLR, the flight test program is progressing towards entry into service expected to take place in Q2 2024. No change.
Speaker 4: On Whitebody we delivered 11 aircraft, each one, of which 6 A330 and 5 A350s.
Speaker 4: As previously announced we target rate 4 in 2024 on the A330 and rate 9 on the A350 at the end of 2025.
Speaker 4: On the A350 freighter, the first components were recently produced by Airbus Atlantic in Nantes.
Speaker 4: As the first milestones are reached, we are now slightly adjusting our industrial planning for this violence, with the entry into service now slipping into early 2026.
Speaker 4: milestones are reached we are now slightly adjusting our industrial planning for this violence with the entry into service now slipping into early 2026 so slight change
Guillaume Faury: Revenues decreased by -5% year on year, mainly reflecting a lower number of deliveries, partly offset by the strengthening of the US dollar. The EBIT Adjusted decreased to €0.6 billion from the €1.1 billion in Q1 2022, reflecting, as I said, the decrease in deliveries, a slightly less favorable hedge rate versus Q1 2022, and investments for preparing the future. Q1 2022 included positive impacts from retirement obligations, partly offset by the impact resulting from international sanctions against Russia. Now looking at helicopters. Excuse me. In Q1 2023, we delivered 71 helicopters, 32 more than in Q1 2022. This was mainly driven by the light segment. The deliveries include the 500th NH90 delivered by NHIndustries to the French Army Aviation.
Speaker 4: Now let's look at Airbus commercial financials for Q1. Revenues decreased by minus 5% year-on-year mainly reflecting a lower number of deliveries.
Speaker 4: partly upset by the strengthening of the US dollar, the EBIT adjusted decrease to 0.6 billion euro from the 1.1 billion euro in Q1 2022 reflecting as I said the decrease in deliveries, a slightly less favorable hedge rate versus Q1 2022 and investments for preparing the future. Q1 2022
Speaker 4: included positive impacts from retirement obligations, partly offset by the impact resulting from international sanctions against Russia.
Speaker 4: Now looking at helicopters.
Speaker 5: Excuse me.
Speaker 4: In Q1 2023 we delivered 71 helicopters, 32 more than in the first quarter of 2022.
Speaker 4: This was mainly driven by the light segments. The deliveries include the 500 NH90 delivered by)}.
Guillaume Faury: Revenues increased 26% year-on-year to EUR 1.6 billion, mainly reflecting a solid performance across programs, favorable mix effects, and a good start in Q1 for services. As a result of this solid performance, EBIT Adjusted increased to EUR 156 million. Here also, Q1 2022 included net positive non-recurring elements to be reminded. Let's complete our review of Q1 with Defense and Space. Revenues decreased 6% year-on-year, mainly driven by lower volume in military air systems and in space systems. This decrease is reflected in the EBIT Adjusted. Again, Q1 2022 also included net positive non-recurring elements. On the A400M, we delivered one aircraft in Q1 2023. We continue with development activities towards achieving the revised capability roadmap. Retrofit activities are progressing in close alignment with the customers.
Speaker 4: industries to the French Army aviation. Revenues increased 26% year-on-year to 1.6 billion euros mainly reflecting a solid performance across programs, favorable mixed effects and a good start in Q1 for services.
Speaker 4: As a result of this solid performance, EBIT adjusted increase to 156 million euros.
Speaker 4: Here also, Q1 2022 included net positive non-recurring elements.
Speaker 4: to be reminded.
let's complete our review of Q1 with defense in space. Revenues decreased 6% year-on-year mainly driven by lower volume in military air systems and in space systems.
This decrease is reflected in the EBITA adjusted and again Q1 2022 also included net positive non-recurring elements.
On the F400M we delivered one aircraft in Q123. We continue with development activities towards achieving the revised capability roadmap.
Guillaume Faury: Risks remain on the qualification of technical capabilities and associated costs, on aircraft operational reliability, on cost reduction, and on securing overall volume as per the revised baseline. Moving forward, let me remind you of our guidance issued in February. As the basis for its 2023 guidance, the company assumes no additional disruptions to the world economy, air traffic, the supply chain, the company's internal operations, and its ability to deliver products and services. The company's guidance is before M&A. On that basis, the company targets to achieve in 2023 around 720 commercial aircraft deliveries and EBIT Adjusted of around €6 billion and free cash flow before M&A and customer financing of around €3 billion. No change to our guidance. Let me now summarize the priorities, which have also not changed since our full-year results call. It starts obviously with our delivery target of 720 commercial aircraft.
retrofit activities are progressing in close alignment with the customers.
Risks remain on the qualification of technical capabilities and associated costs.
aircraft operational reliability, on cost reduction and on securing overall volume as per the revised baseline.
Moving forward, let me remind you of our guidance issued in February .
As the basis for its 2023 guidance, the company assumes no additional disruptions to the world economy, air traffic, the supply chain, the company's internal operations and its ability to deliver products and services.
The company's guidance is before M&A. On that basis the company targets to achieve in 2023 around 720 commercial aircraft deliveries and a bit adjusted of around 6 billion euros and free cash flow before M&A and customer financing of around 3 billion euro. So no change to our guidance.
Let me now summarize the priorities which have also not changed since our full year results call. It starts obviously with our delivery target of 720 commercial aircraft. We all remain focused on hunting up production.
Guillaume Faury: We all remain focused on ramping up production across all our commercial aircraft programs, in close collaboration with our suppliers, to meet high customer demand for single-aisle aircraft and the growing need for new, fuel-efficient wide-bodies. We continue the long-term transformation of the company towards sustainable aerospace with a clear focus on digitalization and decarbonization. On digitalization, I want to highlight from our defense business, the first in-flight autonomous guidance and control of a drone from an Airbus A310 MRTT above Spain. Major milestone. We continued to be very active in Q1. Highlights include the validation by SBTi of our near-term scope 1, 2, and 3 emissions reduction targets. The first flight of the DisruptiveLab helicopter demonstrator, which targets a 50% reduction of emissions.
across all our commercial aircraft programs in close collaboration with our suppliers to meet high customer demand for single-aisle aircraft and the growing need for new fuel-efficient white bodies. In parallel we continue the long-term transformation of the company towards sustainable aerospace.
with a clear focus on digitalization and decarbonization.
On digitalization, I want to highlight from our defense business the first in-flight autonomous guidance and control of a drone from an Airbus A310 MRTT above Spain, major milestone. On decarbonization, we continued to be proactive in Q1. Highlights include the validation by SBTI of our near-term scope 1, 2, and 3.
emissions reduction targets. The first flight of the disruptive lab helicopter demonstrator which targets a 50% reduction of emissions.
Guillaume Faury: The first flight of an A321 with both engines fueled by 100% of SAF, sustainable aviation fuel, and our investment together with customer and partner Qantas in a biofuel production facility in Queensland, Australia. On sustainable aviation fuels, SAF, we are encouraged to see momentum across the globe. This includes governments putting in place supporting legislation. In Europe, with Fit for 55 and ReFuelEU, in the US with the IRA, the Inflation Reduction Act. Most recently, we signed an MoU with the China National Aviation Fuel Group, CNAF, the Chinese airport fuel provider, to develop cooperation on SAF. We expect this to be another major contribution to reach 10% penetration of SAF globally by 2030, of course, grow thereafter. This is it for my opening remarks today. Now, I'm sure you have questions about this quarter.
the first flight of an A321 with both engines fueled by 100% of SaaS, sustainable elevation fuel, and our investments together with customer and partner Qantas in a biofuel production facility in Queensland, Australia.
on sustainable elevation fuels, SaaS. We are encouraged to see momentum across the globe and this includes governments putting in place supporting legislation.
in Europe with FIT for 55 and refuel EU and in the US with the IRA the Inflation Reduction Act.
Most recently we signed an MOU with the China National Aviation Fuel Group, CNAF, the Chinese Airport Fuel Provider to develop cooperation on staff.
We expect this to be another major contribution to reach 10% penetration globally 10% penetration of staff globally by 2030 and of course grow thereafter.
Guillaume Faury: As I said, overall Q1 execution has proven consistent with our 2023 plans. Now, Hélène, back to you. Thank you.
This is it for my opening remarks today. Now I'm sure you have questions about this quarter. As I said overall Q1 execution has proven consistent with our 2023 plans but now...
This is it for my opening remarks today. Now I'm sure you have questions about this quarter. As I said overall Q1 execution has proven consistent with our 2023 plans. But now, Elan, back to you. Thank you.
Hélène Le Gorgeu: Thank you, Guillaume. We will now start our Q&A session. Please introduce yourself and your company when asking a question. Please limit yourself to two questions at a time. This includes sub-questions. As usual, please remember to speak clearly and slowly in order to help all participants, particularly ourselves, to understand your question. Sharon, please go ahead and explain the procedure for the participants.
Thank you Guillaume. We will now start our Q&A session.
Please introduce yourself and your company when asking a question.
Please limit yourself to two questions at a time and this includes sub-questions.
Also, as usual, please remember to speak clearly and slowly in order to help all participants, particularly ourselves, to understand your questions.
Operator: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one one on your telephone keypad. Please limit yourselves to two questions only. The first question. Oh, just bear with me. Looks like we've lost the first question. He's disconnected. I will go to the next question. One moment. Your first question comes from the line of Daniela Costa from Goldman Sachs. Please go ahead. Your line is open.
So Sharon, please go ahead and explain the procedure for the participants.
Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star 11 on your telephone keypad. Please limit yourself to two questions only.
The first question.
Oh just bear with me, looks like we've lost the first question, he's disconnected. I will go to the next question, one moment.
And your first question comes from the line of Daniella Costa from Goldman Sachs. Please go ahead, your line is open.
Daniela Costa: Hi. Good afternoon. Thanks for taking my questions. I'll take the option to ask two. First one, just in terms of we've seen a lot of news flow regarding deliveries and delays in the supply chain, and you've mentioned obviously before that it was back-end loaded. Just wanted to sort of get a view on sort of what's noise and what's reality. When you mean back-end loaded now, is it more back-end loaded than you meant when we spoke about the full year? What is exactly the pressure points at the moment? Is it more engines? Is it more internal ramp-up? If you can elaborate on that. The second question, more sort of in terms of the capital allocation and obviously the free cash flow in Q1 is a little bit better than the Street expected. You're not doing Envidian.
Hi, good afternoon. Thanks for taking my questions. I'll take the option to ask two. First one, just in terms of like we've seen a lot of news flow regarding deliveries and delays in the supply chain and you've mentioned obviously before that it was back and loaded. Just wanted to sort of.
rate on that. And then the second question more sort of in terms of the capital allocation and you're obviously the free cash flow in one queue is a little bit better than the street expected. You're not doing in VDN. I think you've also done some tweaks in the net definition a few months back and you would probably be now I think on the old definition.
Daniela Costa: I think you've also done some tweaks in the net debt definition a few months back, and you would probably be now, I think, on the old definition, at more than the EUR 10 billion cash, which you said was the threshold for the buyback. What prevents you from sort of launching the buyback at this point and anything has changed in terms of thinking about capital allocation? Those are my two questions. Thank you very much.
Guillaume Faury: Yes. Thank you, Daniela. When it comes to the operating environment and the supply chain situations, as expected, unfortunately, as we highlighted already earlier during the full year result 2022 in February, there are a lot of supply issues here and there. You see through the reports, actually some of those problems. We continue to face the same kind of issues, and I went through the short list during my initial speech. It's not more backloaded for 2023 than what we suggested two months ago when we gave the guidance. It's an imbalance between H1 of the year and H2. We expect a very strong September, October, November, December, moving forward. I would say no change from that perspective. Production and deliveries are backloaded. We knew it, and that's what we're facing.
Yes, thank you Daniela. So when it comes to the operating environment and supply chain situations as expected, unfortunately, and as we highlighted already earlier today, earlier, sorry, during the full year result 2022 in February .
There are a lot of supply issues here and there, so you see through the reports actually some of those problems. We continue to face the same kind of issues and I went through the shortlist during my initial speech.
So it's not more back-loaded for 2023 than what we suggested two months ago when we gave the guidance. It's an imbalance between the first half of the year and the second half and we expect a very strong September , October , November , December .
moving forward. So I would say no change from that perspective. Production and deliveries are backloaded. We knew it and that's what we're facing.
Guillaume Faury: Probably a bit more issues on the engine side as we see the combined challenges for the engine makers to supply Airbus for the production and delivery of new planes, but as well, the pressure coming from in-service as the customers are flying very much, and we've seen a big increase in the flight hours being flown and the flight cycles in the market, therefore putting pressure on the support and services of engine parts and the MRO parts for engines. When it comes to capital allocation, well, I'm a bit surprised by your statement. We are not at EUR 10 billion net cash. We have said that we would discuss potential change in the capital allocation once we cross that bridge, I think that's the word we used, or when we cross that mark. We were not there. That's not a discussion for today.
probably a bit more issues on the engine side as we see the combined challenges for the engine makers to supply Airbus for the production and delivery of new planes but as well the pressure coming from in service as the customers are flying very much
and we've seen a big increase in the flight hours being flown and the flight cycles in the market, therefore putting pressure on the support and services of engine parts and the MRO parts for engines.
When it comes to capital allocation, I'm a bit surprised by your statement. We are not at 10 billion euro net cash and we have to say that we would discuss potential change in the capital allocation once we cross
that bridge, I think that's the word we used when we cross that mark and we are not there. So that's not the discussion for today.
Daniela Costa: Got it. Thank you.
Guillaume Faury: Thank you.
Operator: Thank you. We will now take your next question. Your next question comes from the line of Ben Heelan from Bank of America. Please go ahead.
Thank you.
Thank you.
Thank you. Thank you. Thank you.
We will now take your next question. And your next question comes from the line of Ben Heelan of Bank of America. Please go ahead.
Ben Heelan: Yeah. Hi, everybody. Thank you for the questions. Guillaume, I wanted to ask you on the A350, because A350 deliveries have been very weak through the first quarter. It looks like they're going to be weak again in April. Is there something going on with the deliveries here that we need to be aware of, and when do you think we will start to see A350 in particular improving? Following on from Daniela's question on supply chain, I wanted to ask about, because when we see and hear from other suppliers through Q1, a lot of the suppliers have said that they see things getting a bit better. They see things getting easier. We saw engine deliveries of LEAP and GTF improving quite a lot as well. It feels as though it's getting easier, but yet the deliveries continue to be weak.
Hi everybody, thank you for the questions. The first, Guillaume, I wanted to ask you on the A350 because A350 deliveries have been very, very weak through the first quarter. It looks like they're going to be weak again in April . Is there something going on with the deliveries here that we need to be aware of and when do you think we will?
easier. We saw engine deliveries of LEAP and GTF improving quite a lot as well. So it feels as though they're getting easier, but yet the deliveries continue to be weak. So is there something going on in the delivery centres at Airbus that needs resolving? Thank you.
Ben Heelan: Is there something going on in the delivery centers at Airbus that needs resolving? Thank you.
Guillaume Faury: Maybe starting with your second point. Well, indeed, we need all suppliers to be delivering on time and improving the situation to be able to deliver ourselves on time. I said in February that we would increase inventory and the leeway on the production, on the storage, and temporary inventories of parts and components to be safer and secure our 2023 deliveries. That's what we are doing. It comes with an increase industrial working capital that is weighing on our free cash flow. There's no specific issue or difference compared to what we were expecting in the production profile at Airbus compared to the plan beginning of this year.
Maybe starting with your second point, well indeed we need all suppliers to be delivering on time and improving the situation to be able to deliver ourselves on time. I said in February that we would increase inventory and...
I mean the leeway on the production on the storage and temporary inventories of parts and components to be safer and secure are 20-23 deliveries so that's what we are doing it comes with an increase
industrial working capital that is weighing on our free cash flow but there's no specific issue or difference compared to what we were expecting in the production profile at Airbus compared to the planned beginning of this year. So it's a weak Q1 but it's a Q1 that is in line with what we had planned for 2023 and therefore very much still consistent with
Guillaume Faury: It's a weak Q1, but it's a Q1 that is in line with what we had planned for 2023, and therefore very much still consistent with the perspective for 2023, and therefore we maintain the guidance in the number of deliveries. That applies as well to the A350, and you're right in saying that Q1 has been weak on the A350 deliveries. Q2 will be weak as well, and so the A350 will be backloaded with a very strong H2 and Q4 expected on the A350. That's the overall background that we are facing. What I can say is that the production ramp-up that is necessary to support deliveries at a later stage, and therefore supporting the guidance, is happening on track. Therefore, the reason why we maintain the guidance and we think that we are on trajectory compared to the execution of the plan.
the perspective for 2023 and therefore we maintain the guidance in the number of deliveries.
That applies as well to the A350 and you're right in saying that Q1 has been weak on the A350 deliveries, Q2 will be weak as well and so the A350 will be backloaded with a very strong H2 and Q4 expected on the A350. So that's the overall background that...
we are facing and what I can say that the production ramp up that is necessary to support deliveries at a later stage and therefore supporting the guidance is happening on track and therefore the reason why we maintain the guidance and we think that we are on trajectory compared to the
Ben Heelan: Okay. That's great. Thanks for the color.
Operator: Thank you. We will now go to our next question. Your next question comes from the line of Tristan Sanson from BNP Paribas. Please go ahead.
Okay, that's great. Thanks for the colour.
Thank you. We will now go to your next question.
And your next question comes from the line of Tristan Stanton from BNP Paribas. Please go ahead.
Tristan Sanson: Yes. Good evening, everyone. It's Tristan from BNP Paribas Exane. Thanks for taking my questions. The first one will be on the PW1100G engine for the A320neo. I wonder whether you could tell us how you deal industrially and commercially with the concerns that are spreading today on the time on wing of the engine. It would be most helpful. The second question, you've been mentioning a number of times that in Q1 you've been investing to prepare the future. Can you be a bit more specific, both qualitatively and quantitatively, about what these spendings are? Is it training and recruitment to prepare for the wide-body ramp-up? Is it tooling, and are we talking about EUR 100 million, EUR 200 million, EUR 300 million? That would be quite helpful.
Yes, good evening everyone. This is Cléson from the BMP exam. Thanks for taking my questions.
The first one will be on the PW1000 engine for the A320neo. I wonder whether you could tell us how you deal industrially and commercially with the concerns that are spreading today on the Simon wing of the engine.
would be more helpful. And the second question you've been mentioning a number of times that in Q1 you've been investing to prepare the future. Can you be a bit more specific both in quantitatively and quantitatively about what these spending are?
training and recruitment to prepare for the wide-body ramp-up, including, and are we talking about 100, 200, 300 million euros? That would be quite helpful.
Guillaume Faury: Well, let's start with the Pratt & Whitney situation on the A320, I think you said. Indeed, the time on wing for certain kind of operations is lower than expected, combined with the supply chain situation and the global tensions on supply, leading to lack of spare parts or delayed in the spare parts and the MRO, and therefore having some aircraft AOGs. That's mainly a situation to be managed between the engine manufacturer and the airline as the contracts are between those two parties. Obviously, as the aircraft manufacturer, that's a situation that we are monitoring very closely and coordinating a number of situations between our customers and Pratt & Whitney to minimize the impact of such a situation. That's something that is currently being managed by Pratt & Whitney mainly.
Well let's start with the protonuitne situation on the A320. I think you said we have as well some concerns on the A220 and indeed the time on wing for certain kind of operations is lower than expected leading
combined with the supply chain situation and the global tensions on supply leading to lack of spare parts and are delayed in the spare parts and the MRO and therefore having some aircraft AOGs and that's
manage between the engine manufacturer and the airline as the contracts are between those two parties. But obviously as the aircraft manufacturer that's a situation that we are monitoring very closely and coordinating a number of situations between our customers and President Whitney to minimize the impact of such a situation.
Guillaume Faury: When it comes to investment of the future, well it's a very broad question as we are investing both in R&D and in CapEx for the future. I think your question refers to the CapEx and maybe the announcement of the line 2 in China that was made recently is sort of contributing to the answer to your question. Actually, we are building the production system of the future for the A220, the A320, including the 10 FALs that will be all A321 capable and the ramp up for up to rate 4 for the A330neo and up to rate 9 on the A350. I think that's mainly what we mean by investment in the future when it comes to the production system and the ramp up.
but that's something that is currently being managed by patent witness mainly. When it comes to investment of the future, it's a very broad question as we're investing both in R&D and in CAPEX for the future. I think your question refers to the CAPEX and maybe the announcement of the line two in China that was made recently.
sort of contributing to the answer to your question. Actually we are building the production system of the future for the A220, the A320 including the 10 files that are now that will be all A321 capable and the ramp up for up to rate 4 for the 330 new and up to rate
the A350. I think that's mainly what we mean by investment in the future when it comes to the production system and the ramp up and when it comes to the technologies but that's primarily all what we have already shared with you leading to the progressive ramp up
Guillaume Faury: Well, when it comes to the technologies, that's primarily all what we have already shared with you, leading to the progressive ramp up of our R&D expenses, which is primarily driven by the new programs, be them the XLR, the A350 freighter, and overall our efforts to decarbonize and to digitalize the product, the production system, as well the support and services activities. That's the overall investment into the future, which leads to this progressive ramp up of costs and expenses, as I try to summarize, because it's a very broad question that you raised when it comes to the many EUR billions we are spending every year to prepare the future.
which is primarily driven by the new programs within the XLR, the A350 freighter and overall our efforts to decarbonize and to digitalize the product, the production system and when it comes to digitalization as well as the support and services activities that the overall investment into the future.
which leads to this progress of cost and expenses as I try to summarize because it's a very it's a very broad question that you raised when it comes to the many billions we are spending every year to prepare the future.
Tristan Sanson: Yeah, to be clear, I wasn't mentioning CapEx, but OpEx has this investment for preparing the future I mentioned as a driver of pressure on EBIT Adjusted in Q1, but I think your explanation shed a bit of light on it.
To be clear, I wasn't mentioning CAPEX, but OPEX has this investment for proclaring the future. I mentioned that as a driver of pressure on EBITAD, you said in Q1, but I think your explanation should be in the final. Yes, that's the increase in R&D I guess.
Guillaume Faury: Yeah, that's the increase in R&D, I guess. Yeah. It's not linear in the year, and it varies from one year to the other one. I don't remember, Xavier, maybe you have the figure, but I guess this year we have started a bit faster or with higher expenses in Q1 compared to last year.
It's not linear in the year and it varies from one year to the other one. I don't remember, Xavier, maybe you have the figure, but I guess this year we have started a bit faster or with higher expenses in Q1 compared to last year. Yes, in fact we are spending 100 million more than in Q1-22.
Xavier Tardy: Yes. In fact, we are spending EUR 100 million more than in Q1 2022.
Guillaume Faury: Okay.
Xavier Tardy: Yeah.
Guillaume Faury: That is what we mean by investment in the future.
Xavier Tardy: Yes.
Guillaume Faury: R&D.
Xavier Tardy: R&D. R&D. Yeah.
Okay yeah that's what we mean by investment in the future.
Guillaume Faury: Thank you.
Operator: Thank you. We will now go to your next question. The next question comes from the line of Olivier Brochet from Redburn. Please go ahead. Your line is open.
Thank you.
Thank you. We will now go to your next question.
And the next question comes from the line of Olivier Brochet from Redburn. Please go ahead, your line is open. Yes, good evening. Thank you for taking my questions. I will have two, if I may. The first one is could you elaborate a bit on how much of a headwind inflation is the opposite of what the EM institutional opinion is.
Olivier Brochet: Yes. Good evening. Thank you for taking my questions. I will have two, if I may. The first one is, could you elaborate a bit on how much of a headwind inflation has been in Q1 for the three different businesses? The second one is on the Qatar settlement. Has it been a cash out in Q1, or will it only come with the first A350 deliveries that you will make to them? Thank you.
Xavier Tardy: Yeah, I'll start with the inflation for Q1. We are in a very low double-digit numbers. It's in the very low to mid double-digit numbers for inflation.
So, yeah, I'll start with the inflation for Q1. So, we are in very low double digit numbers.
Guillaume Faury: Qatar settlement is a confidential settlement agreement. No comment on the Qatar settlement.
in very low to mid double digit numbers.
low to meet double digit numbers for
Qatar settlement is a confidential settlement agreement. No comment on the Qatar settlement.
Qatar settlement is a confidential settlement agreement. No comment on the Qatar settlement. Not even on timing.
Olivier Brochet: Not even on timing?
Guillaume Faury: Well, it was signed earlier this year.
Olivier Brochet: Thank you.
Guillaume Faury: Behind us, looking forward as partners.
Well, it was signed earlier this year.
Well, it was signed earlier this year. Thank you. It's behind us. Forward.
Olivier Brochet: Thank you.
Operator: Thank you. We will now go to your next question. Your next question comes from the line of Douglas Harned from Bernstein. Please go ahead. Your line is open.
as partners. Thank you. Thank you. We will now go to our next question.
And your next question comes from the line of Doug Harnett from Burnscene. Please go ahead your line is open.
Douglas Harned: Good evening. Thank you. First question, when you talk about strong demand, that's clearly very positive, but can you tell us how long you're sold out for at this point and what you can do to respond to customers that may be seeking to order aircraft for delivery in earlier years? Second question, in the past you've described when you get out to delivery rates like we saw in 2019, you could get back to Airbus commercial margins that were also like those in 2019. First, is that still the case? As you move beyond this and go to 75 a month later on, how do you see margins progressing beyond that point?
Good evening. Thank you. So first question, when you talk about strong demand, that's clearly very positive, but can you tell us how long you're sold out for at this point and what you can do to respond to customers.
that may be seeking to order aircraft for delivery in earlier years. And then second question, in the past you've described when you get out to delivery rates, like we saw in 2019, you could get back to Airbus commercial margins that were also like those in 2019.
First, is that still the case? And then as you move beyond this and go to 75 a month later on, how do you see margins progressing beyond that point?
Guillaume Faury: Well, on the first question, actually, we have a backlog of more than 7,000 planes. If your question refers to the A320, which is the aircraft which is the most in demand, we are actually full in terms of orders till 2029, so we cannot deliver to a customer that is coming now and asking for a new plane before 2029. The best way to get there is to ramp up, and that relies on the ramp up. That's why the ramp up is so important for us, to be able to deliver on-time customers who have already placed orders and to not have the date of the first aircraft available moving even further into the future.
Well.
Well, on the first question...
Actually we have a backlog of more than 7,000 planes if your question refers to the A320 which is the aircraft which is the most in demand we
till 2029 so we cannot deliver to a customer that is coming now and asking for a new plane before 2029 and the best way to get there is to ramp up and that relies on the ramp up. That's why the ramp up is so important for us to be able to deliver on time customers who
Guillaume Faury: This being said, we still continue to take orders even for the A320 family, and very significant number of orders as this plane is, as I said, a very leading product in its market segment. It's different on the A220, on the A330neo, and the A350. We have more availability, and in the shorter term, but still, on those products, we are also quite well booked. When it come to your question on the margins of Airbus, I can confirm that we maintain the perspective of being back to the 2019 profitability when we get back to the 2019 number of deliveries. I remind you that it was, top of my mind, 863 aircraft at that time. I can remind you as well that we delivered last year, 661, and the guidance for this year is 720.
and to not have the date of the first aircraft available moving even further into the future. With this being said we still continue to take orders even for the FK-20 family and very a significant number of orders as this plane is as I said a very leading product
It's different on the A220, on the A330neo and the A350. We have more availability in the shorter term, but still on those products we are also quite well booked. When it comes to your question on the margins of Airbus, I can confirm that we maintain...
the perspective of being back to the 2019 profitability when we get back to the 2019 number of deliveries. I remind you that it was top of my mind 863 across
Guillaume Faury: You see, we still have a lot of work and a long way to go before being back to the 2019 figures. Unfortunately, that's one of the results of this very complex and challenging supply environment going out of COVID. For the evolution of the margins beyond being back to 863 planes, Well, I will not comment here and would take more time. We are giving building blocks on how the profitability of the company is built, and in combination with the trajectory on the production rates, that gives you the opportunity to build over time what the development of the Airbus profitability would look like. I'm sure that the IR team will be very happy, Hélène and the team, to guide you for this on a private call.
that time can remind you as well that we delivered last year 661 and the guidance for this year is 720. So you see we still have a lot of data to do.
of work and a long way to go before being back to the 2019 figures. Unfortunately that's one of the results of this very complex and challenging supply environments going out of COVID-19.
And for the evolution of the margins beyond being back to 863 planes, well I will not comment here and we take more time, we are building blocks on how the profitability of the company is built.
And in combination with the projectory on the production rate, that gives you the opportunity to build over time what the development of the Airbus profitability would look like. And I'm sure that the IR team will be very happy, Hélène and the team, to guide you through this on a private call.
with the Projectory on the production rate that gives you the opportunity to build over time What the development of the ABUS profitability would look like and I'm sure that the IR team Will be very happy, Hélène and the team, to guide you for this on a private call. Great, thank you.
Douglas Harned: Great. Thank you.
Operator: Thank you. We will now go to our next question. Your next question comes to the line of Phil Buller from Berenberg. Please go ahead. Your line is open.
Thank you. We will now go to our next question. And your next question comes from the line of Phil Buller from Barenberg. Please go ahead, your line is open.
Phil Buller: Hi there. Thanks for taking the question. I guess I'm trying to reconcile the comments about the unchanged guide for this year in the midterm ramp, with several of your major suppliers, including Spirit in the past hour or so, who are suggesting that you've recently lowered orders from them on the A320 program from 660 to 580, I think they said. How do we think about the cadence to rate 65 and 75, when you're reducing rates with suppliers? Because I understand you say that they're unchanged. If I look at consensus, it looks like the market is assuming you'll deliver 850 aircraft next year, so approaching those 2019 levels, and 980-ish come 2025. I guess I'm just keen to understand if you think those modeling assumptions are in the right ballpark or perhaps too optimistic.
Hi there, thanks for taking the question. I guess I'm trying to reconcile the comments about the unchanged guide for this year in the midterm ramp with several of your major suppliers, including Spirit in the past hour or so, who are suggesting that you've recently lowered orders from them on the on the A320 program from 660 to 580. I think they said so.
you know, how do we think about the cadence to rate 65 and 75 when you're reducing rates with suppliers? Because I understand you say that they're unchanged. But if I look at consensus, it looks like, you know, the market is assuming you'll deliver 850 aircraft next year, so approaching those 2019 levels and 980-ish come 2025. So I guess I'm just keen to understand if you think those modeling assumptions are...
Phil Buller: Obviously not because of your own desire or the demand, but given what you've learned about your suppliers' ability to ramp up in practice as, I guess, what you're asking them to do near term might introduce another ramp-up challenge for them in due course when they chase those higher rates. That's the first question.
Guillaume Faury: Okay. I'll try to answer that one. You have seen the Spirit information, I guess, on their number of deliveries. Please remember that we were supposed to deliver 720 planes last year, and we ended up with only 661 being delivered. We had obviously planned to ramp up in 2023 compared to 2022. With the 2022 at 720, this would have led to a very significant, bigger number in 2023. Unfortunately, we ended up with 660. We have rebaselined the production planning, leading to a guidance of 720 again for this year. Of course, we have to adjust the supply plans with most, if not all of our suppliers, to reflect the fact that we have a slower ramp up compared to what we were initially planning by beginning of last year. This is reflected in a number of comments from the suppliers.
you have seen the spirit information I guess on the on their number of deliveries. Please remember that we were supposed to deliver 720 planes last year and we ended up with only 661 being
leading to a guidance of 720 again for this year. So of course we have to adjust the supply plans with most if not all of our suppliers to reflect the fact that we have a slower ramp up compared to what we were initially planning.
Guillaume Faury: It's easing the ramp up to do this rebaselining, which we did by end of last year and beginning of this year. There is no change compared to our guidance. What you heard from Spirit and from others, as far as I have seen and heard and commented by my team, is just reflecting what we have done to support the deliveries of the 720 planes this year. I think that's important. Now, when it comes to the rates moving forward, as I indicated in my preliminary comments, no change on reaching the rate 65 by end of 2024, as far as I remember, and the rate 75 in 2026. This is not changed. You can make your assumptions on how we get there and the trajectory. We are not specific on rates quarter by quarter or even half-year by half-year.
beginning of last year and this is reflected in a number of comments from the suppliers. It's easing the ramp up to do this rebase lining which we did by end of last year and beginning of this year but there is no change compared to
you heard from Spirit and from others as far as I have seen and heard and commented by my team is just reflecting what we have done to support the deliveries of the 720 planes this year so I think that's that's important. Now when it comes to the to the rates moving forward as I indicated in my preliminary comment
no change on reaching the rate 65 by end of 24 as far as I remember and the rate 75 in 2026. This is not changed.
and then you can make your assumptions on how we get there and the trajectory. We are not specific on rates quarter by quarter or even
Guillaume Faury: As you see, in 2023, we have an imbalance between H1 and H2, and this can sometimes happen. It is not very comfortable this year, but it is what it is.
half year by half year as you see in 2023 we have an unbalance between H1 and H2 and this can sometimes happen it's not very consultable this year but it is what it is. I understand thank you very much I guess I guess the the reality is the suppliers are struggling to deliver what you need so I was wondering if a downward adjustment near term might make their
Phil Buller: No, I understand. Thank you very much. I guess, the reality is the suppliers are struggling to deliver what you need. I was wondering if a downward adjustment near term might make the steep ramp harder for some of those suppliers later as we look beyond rate 65. You've answered that quite nicely, I'm sure. Just another question, just a comment in the prepared remarks about the aircraft financing environment I think you said was solid. I think it was mentioned that the low level of customer financing may not be sustainable. I was hoping you could just elaborate a bit on what that means exactly in practice, please. Thank you.
steep ramp harder for some of those suppliers later as we look beyond rate 65. But you've answered that quite nicely, I'm sure. And then just another question, just a comment in the prepared remarks about the aircraft financing environment, I think you said was solid. But I think it was mentioned that the low level of customer financing may not be sustainable. I was hoping you could just elaborate a bit on what that means exactly in practice, please. Thank you.
Guillaume Faury: Xavier or Hélène, someone wants to comment on this? Well, maybe basically, today, the situation is very healthy. The second one is that we see tensions on financing overall and on the banking and financing system. We don't expect the situation to remain as good as it is today, but there is no specific indication or no specific report to be shared, except that, like all of you, we see the situation on the market getting a bit more tense. That's basically, I think, reflecting what we wanted. Hélène, will you add something?
Xavier or Hélène, someone wants to comment on this. Well maybe basically today the situation is very healthy. That's the first part of the comment. The second one is that we see tensions on financing overall and on the banking and financing system so we don't expect the situation to remain as good as it is today but there is no specific...
indication or no specific report to be shared except that like all of you we see the situation on the on the market being getting a bit more tense that's basically I think reflecting what we want to do. And if I recall correctly we did that already the same
Hélène Le Gorgeu: Phil, if I recall correctly, we did that already, the same comments at the full year 2022 to highlight that it might not be like this forever. That was it.
Phil Buller: Thanks for the clarification. Thanks.
Operator: Thank you. We will now go to our next question. Your next question comes from the line of Robert Stallard from Vertical Research Partners. Please go ahead.
question and your next question comes from the line of Robert Stallard from vertical recent partners please go ahead
Robert Stallard: Thanks so much, and good evening.
Guillaume Faury: Good evening. We hear you.
Robert Stallard: Good. Guillaume, a couple questions for you. First of all, on the A350 freighter, you noted there's been a modest change to the timetable there. I was wondering if you could elaborate on what occurred, what changed in terms of your thinking on that program. On the A220, again, Spirit taking a pretty significant charge in their quarterly results, especially relating to their supply chain. I was wondering if that has had any knock-on impact on your A220 ramp plans. Thank you.
Thanks so much and good evening. Good evening, we hear you. Oh good, Guillaume a couple of questions for you. First of all on the A350 freighter you noted there's been a modest change to the timetable there. I was wondering if you could elaborate on what occurred, you know what changed.
in terms of your thinking on that program. And then on the A220, again, Spirit taking a pretty significant charge in their quarterly results, especially relating to their supply chain. And I was wondering if that has had any knock-on impact on your A220 ramp plans. Thank you.
Guillaume Faury: On the latest question, no. No impact of this Spirit comment on our own plans. When it comes to the A350 freighter, we are in the execution of the program. We are in the development phase. We are starting the industrialization of the product. We are updating constantly the planning, and what we have said today reflects a slight slippage of the overall planning. There's no change in thinking of the program. It's just that the entry into service is now slightly pushed into the beginning of 2026. It's the repercussion of the execution of the development program and the industrialization phase.
So on the latest question, no impact of this spirit comment on our own plans. When it comes to the A350 freighter, we are in the execution of the program, we are in the development phase, we are starting the industrialization of the product.
So we are updating constantly the planning and what we have said today reflects a slight slippage of the overall planning. There's no change in thinking of the program, just that the entry into service is now slightly pushed into the beginning of 2026. It's the execution of the development program.
Robert Stallard: I just want to follow up on that, if I may. Is there any associated additional cost with this change in the A350 freighter schedule?
and the initialization setting. I can follow up on that if I may. Is there any associated additional cost with this change in the 350 freighter schedule? Well we are not communicating on the specific cost of one
Guillaume Faury: Well, we are not communicating on the specific cost of one or the other of the programs. There's no change in the guidance for 2023 on EBIT and free cash flow as a result of this slight delay. Well, I think there's nothing more to be said.
There's no change in the guidance for 2023 on EBIT and FRCACHLO as a result of this slight delay and I think there's nothing more to be said.
guidance for 2023 on EBIT and Fricash flow as a result of this slight delay. I think there's nothing more to be said.
Robert Stallard: Okay. Thank you very much.
Guillaume Faury: Pleasure.
Operator: Thank you. We will now go to our next question. Your next question comes from the line of Ian Douglas-Pennant from UBS. Please go ahead.
Thank you. We will now go to your next question. And your next question comes from the line of Ian Douglas-Pennant from UBS. Please go ahead.
Ian Douglas-Pennant: Yeah, Ian Douglas from UBS. Thank you so much for fitting me in. Could I go back on the earlier question on the A350, please? What is the source of the weakness that we've seen so far this year and that will continue for the next couple of months, please? Secondly, if you could maybe just give some commentary on the helicopter business. One of your competitors this morning has also reported very strong order intake after very strong order intake last year as well. Should we take this as a signal that the underlying market is very healthy, or is this just a few large orders and just the way that randomness falls? Thank you.
Yeah, Adrian, to UBS. Thank you so much for fitting me in. Could I go back on the earlier question on the A350 please? What is the source of the weakness that we've seen so far this year and that will continue for the next couple of months, please?
Secondly, if you could maybe just give some commentary on the helicopter business. One of your competitors this morning has also reported very strong order intake after very strong order intake last year as well. Should we take this as a signal that the underlying market is very healthy or is this just a few large orders and just the way that randomness falls?
Guillaume Faury: Your question on the weakness of the A350, I guess, refers to the number of deliveries. In Q1, we delivered.
Ian Douglas-Pennant: Yes
Guillaume Faury: five A350s. As you've seen, a very strong order intake of A350s in Q1. The A350 deliveries are planned to be very backloaded as well, or to be very backloaded, more than the average. We plan a weak Q1 and a weak Q2 in deliveries for the A350 and a very strong Q3 and even stronger Q4 this year. The A350 itself is very backloaded.
So the F350 deliveries are planned to be very backloaded as well, to be very backloaded, more than the average. So we plan a weak Q1 and a weak Q2 in deliveries for the F350 in a very strong Q3 and even stronger Q4 this year. So
Ian Douglas-Pennant: Sorry. If I could just clarify my question. Does that reflect the customer's desired delivery timeline? Are there some problems in the supply chain that you plan to deal with?
is very back loaded. When it comes to the... If I could just clarify my question, does that reflect the customer's desired delivery timeline or are there some problems in the supply chain that you plan to deal with? It's not coming from the demand.
Guillaume Faury: It's not coming from the demand. It's coming from the profile of deliveries that is not necessarily linear because it's depending on the large number of constraints and perspectives. It's more backloaded than what we would like. Indeed, the overall supply environment is waiting on our ability to get deliveries from a number of suppliers, and that impacts the A350, among others. That's why the A350 is planned to be significantly backloaded in H2 of the year.
coming from the profile of deliveries that is not necessarily linear because it's
constraints and perspectives. It's more backloaded than what we would like. Indeed, the overall supply environment is waiting on our ability to get deliveries from a number of suppliers and that impacts the F350 among others.
Ian Douglas-Pennant: Thank you.
Guillaume Faury: Coming from the supply, not from the demand. When it comes to helicopters, I've not seen the results reported by the competitor you're mentioning. What I can say is that the market of helicopters, civil and parapublic helicopters, is improving but recovering from a very low point in 2021, 2022. On the military side, there is more demand, but then it comes indeed with large programs and a very unevenly distributed set of orders. You can consider that there is a trend for a larger market, mainly driven by defense and to some extent by this recovery on the civil and parapublic market. That's the Airbus view. I cannot comment on this competitor.
So that's why the FV50 is planned to be significantly back-loaded in the second half of the year. Not from the supply, not from the demand.
When it comes to helicopters I've not seen the results reported by the competitor you're mentioning. What I can say is that the market of helicopters, civil and parapublic helicopters, is improving but recovering from a very low point in 2021-2022 and on the
Ian Douglas-Pennant: Thank you very much.
Guillaume Faury: Sure.
Operator: Thank you. We will now go to your next question. Your next question comes from the line of Chloé Lemarié from Jefferies. Please go ahead.
I cannot comment on this competitor.
Thank you very much.
Thank you very much. Thank you.
We will now go to your next question. And your next question comes from the line of Chloe Lemari from Jeffries. Please go ahead.
Chloé Lemarié: Yes. Good evening. Thank you for the questions. I have two, if I may. The first one is a follow-up on the supply chain questions. Guillaume, you mentioned in the prepared remarks that seats were a pain point, and I wondered if that was now the driver for the slower wide-body deliveries. Also, Airbus commercial inventory went up EUR 1.4 billion in the quarter I think. Would seats be among the reason why some of those aircraft couldn't be delivered by the end of the quarter? The second one is on hedges. How should we interpret the rollout of hedges in both 2023 and 2024? Is that lower internal delivery target or is it just somewhat lagging adjustment to the hedge book after the rephasing that you announced earlier? Thank you.
Yes, good evening, thank you for the questions. I'll have two if I may. The first one is a follow up on the supply chain questions. No, simply, Guillaume, you mentioned in the pre-part remarks that seats were at pain points and I wondered if that was now the driver for the store, wide body deliveries. Also, Airbus Commercial Inventory went up 1.5% in the year
Is that lower internal delivery target or is it just somewhat lagging adjustment to the head book after the rephrasing that you announced earlier? Thank you.
Guillaume Faury: Xavier will take your easy question on the rollover of hedges. No, more seriously. Yes, seats are now on the list of supplies that arrive late and not just for one or the other, but it seems to be a bit more like a broader perspective, a broader issue in the supply chain and demand for high-end seats in particular. Yes, it is one of the contributing factors of the delays we're having on the wide bodies. It contributes mechanically to the inventory by the end of the quarter. For the hedges
Xavier will take your easy question on the rollover of edges. No more seriously yes seats are now on the list of supplies that arrive late and not just for one or the other but it seems to be a bit more like a broader perspective a border issue in the supply chain.
demand for high-end seats in particular. Yes, it is one of the contributing factors of the delays we're having on the wide-body.
and it contributes mechanically to the inventory by the end of the quarter. For the edges, yes I can take it. Basically, as we announced it in fully 2022, we have
Xavier Tardy: Yes.
Guillaume Faury: Xavier?
Xavier Tardy: Yeah, I can take it. Basically, as we announced it in full year 2022, we have adjusted the trajectory of deliveries, and the rollout of the hedges is just the illustration of this rephasing of the trajectory. It's fully in line with the adjustment.
the roll out of the hedges is just the illustration of this rephrasing of the trajectory so it's fully in line with the adjustment. Okay, it's to cope with the delivery profile. Yes, exactly.
Guillaume Faury: Okay. It's to cope with the delivery profile.
rollout of the hedges is just the illustration of this rephasing of the trajectory so it's fully in line with the adjustment. Okay, to cope with the delivery profile. Yes, exactly. Very clear.
Xavier Tardy: Yes, exactly.
Guillaume Faury: Thank you.
Chloé Lemarié: Very clear. Thank you.
Operator: Thank you. We will now go to your next question. Your next question comes from the line of David Perry from JP Morgan. Please go ahead.
We will now go to your next question. And your next question comes from the line of David Perry from JP Morgan. Please go ahead. Yeah, hi. Thank you. So two questions. The first one, maybe it's a bit of an unfair question, but Graham, just what's your level of confidence in regards to your thought experience Humor and weightlessness?
David Perry: Yeah. Hi, thank you. It's for two questions. The first one, maybe it's a bit of an unfair question, but Guillaume, just what's your level of confidence on the 720 this year? Obviously, the word backloaded is used a lot on this call, but do you see much of a risk that we have a repeat of last year where the guidance gets trimmed towards the end of the year or even missed? Would be the first question. The second question is XLR, the six-month slippage on entry into service. Does that affect your view of total deliveries next year, or can you replace those XLR slots with other variants of the A321? Thank you.
on the 720 this year. Obviously the word backloaded is used a lot on this call, but do you see much of a risk that we have a repeat of last year where the guidance gets trimmed towards the end of the year or even missed would be the first question. The second question is XLR, the 6 month spiritual CITTER?
slippage on entry into service. Does that affect your view of total deliveries next year or can you replace those XLR slots with other variants of the A321? Thank you. Just to be clear we have not changed the XLR into service date I mean recently and what I have said for the...
Guillaume Faury: Well, just to be clear, we have not changed the XLR entry into service date recently. What I have said for the Q2 2024 is exactly what we said previously. There is no new delay, I would say, on the XLR, and we are stable for the entry into service, and therefore the 720 deliveries that are reflected in the guidance do not include any XLR, neither before this call nor after this call.
Q2 2024 is exactly what we said previously so there is no new delay I would say on the XLR and we are stable for the entry into service and therefore the 720 deliveries
reflected in the guidance do not incorporate do not include any XLR neither before this call nor after this
David Perry: No. For next year. Sorry. There's no change for next year, is there? That might be my mistake. I apologize.
No, no, but four for next year, sorry.
Guillaume Faury: Yeah. On the XLR, there is no change.
David Perry: Okay. Sorry, my mistake.
There's no change for next year is there? That might be my mistake. I apologise. Yes, yes, on the XLR there is no change.
Guillaume Faury: No change on the XLR. We have not yet given a guidance for next year. Okay? Well, your question, it's not unfair. It's a guidance. We missed the guidance last year on the 720. The 720 for this year has been built, taking into account the reality of the supply chain as we have experienced in 2022, and assuming that it would continue to be roughly the same in 2023, which is what we are observing so far. You've heard maybe earlier that there are slight improvements here and there in the supply chain. It's not yet a complete trend on which we could really rely on. We're confirming the guidance today, which means that we consider that the best outlook we can have.
and we have not yet given a guidance for next year okay well your question well it's not unfair it's a guidance we meet the guidance last year on the 720 the 720 for this year has been built
taken into account the reality of the supply chain as we have experienced in 2022 and assuming that it would continue to be roughly the same in 2023 which is what we are observing so far and you've heard maybe earlier that there are slight improvements here and there in the supply chain it's not yet a complete trend.
Guillaume Faury: I would not say that I feel comfortable because, as you rightly said, it's backloaded, so we have made a step forward in Q1 with 127 planes. Obviously, a lot remains to be demonstrated, almost close to 600 planes for the remaining nine months of the year, so there's still a lot of work ahead of us. The execution of the production planning by end of Q1 was consistent with this guidance and this perspective. Yes, we feel that it's the right guidance to give to confirm the 720. That's the best guess and guidance I can give today.
which we could really rely on. We're confirming the guidance today which means that we consider that's the best outlook we can have. I would not say that I feel comfortable because as you rightly said it's backloaded so we have made a step forward into one with
remains to be demonstrated almost close to 600 planes for the remaining nine months of the year so there's still a lot of work ahead of us but the execution of the production planning by end of the one was consistent with this guidance and this perspective so yes we feel
David Perry: Okay. Thank you. Sorry for unnecessary panic on the XLR. I just don't know what happened there. I misread something. Thanks a lot.
but it's the right guidance to give to confirm the 720. That's the best guess and guidance I can give today. Okay thank you and sorry for unnecessary panic on the XLR, I just don't know what happened now, I misread something. Thanks a lot.
Guillaume Faury: Pleasure.
Operator: Thank you. We will now take our last question for today. The last question comes from the line of Christophe Menard from Deutsche Bank. Please go ahead.
We will now take our last question for today. And the last question comes from the line of Christoph Nennard from Deutsche Bank. Please go ahead.
Guillaume Faury: Christophe, please.
Christophe Menard: Yes. Good evening. Thank you for taking my question. Yes. Can you hear me?
Christophe, please. Yes, good evening. Thank you for taking my question. Yes, can you hear me?
Thank you for taking my question. Yes, can you hear me? Yes, we can hear you. Please proceed.
Guillaume Faury: Yes, we can hear you. Please proceed.
Christophe Menard: Can you hear me?
Guillaume Faury: Yeah, we can hear you.
Christophe Menard: Can you hear me?
Guillaume Faury: We can hear you, but you can't hear us apparently.
Christophe Menard: Sorry. Thank you for taking the question. No, I can hear you very well. Two questions. The first one is going back on the helicopters and the strong performance in services. Could you please tell us whether it's a one-off or something that we should expect as a recurring element? The margin is very strong. You mentioned services being strong. Where is it coming from? Is it military? Is it oil and gas? The second question is on aircraft financing. You mentioned aircraft financing several times during the call. I'm still trying a little bit to understand on the wide-body delivery, the reason why we have some of delivery delays. I understand it's seats, but is financing also more difficult to arrange for airlines at the moment? Does it take longer? That's the question.
Yes, we can hear you. Can you hear me? We can hear you but you can't hear us apparently. Sorry. Thank you for taking the question. Yeah. No, no, I can hear you very well. I can hear you very well. So, you have two questions. The first one is going back on the helicopters.
and the strong performance in services. Could you please tell us whether it's a one-off or something that we should expect as a recurring element? The margin is very strong. You mentioned services being strong. Where is it coming from? Is it military? Is it oil and gas? And the second question is on the
aircraft financing, you mentioned aircraft financing several times during the call. I'm still trying a little bit to understand on the wide body delivery, the reason why we have those, I mean some of delivery delays, I mean I understand it's seeds, but is financing also more difficult to arrange for airlines at the moment? Does it take longer?
Guillaume Faury: Yes. Maybe I start with the second question. We are not saying that there are delays caused by seats. We are saying that seats are one of the supplies which are coming late, among others, and not justifying the delays or the profile of deliveries of the wide bodies only by the seats, okay? We had planned to have a backloaded delivery profile for the wide bodies, and that's what we see, and it comes from a number of supplies, including seats, but not limited to seats. It's not related to difficulties on aircraft financing. It is not related to aircraft financing potential difficulties. It's not the case. On helicopters, well, yes, there is a very strong Q1 performance on EBIT.
That's the question. Yes, maybe I start with the second question. We are not saying that there are delays caused by seats. We are saying that seats are one of the supplies which are coming late among others.
not justifying the delays or the profile of deliveries of the white bodies only by the seats. We had planned to have a backloaded delivery profile for the white bodies and that's what we see and it comes from a number of supplies including seats but not limited to seats.
and it's not related to difficulties on aircraft financing it is not related to aircraft financing potential difficulties it's not the case. On helicopters well yes there is a very strong Q1 performance on EBIT there's indeed some one-off that will not be repeated in this very strong Q1 but as well
Guillaume Faury: There's indeed some one-off that will not be repeated in this very strong Q1, but as well, good recurring elements that highlight the fact that helicopters continues to be on the ramp up trajectory in terms of financial performance. It comes in particular from services, but not only.
good recurring elements that highlight the fact that helicopters continue to be on a ramp up trajectory in terms of financial performance. And it comes in particular from services but not only.
good recurring elements that highlight the fact that helicopters continues to be on the ramp up trajectory in terms of financial performance. And it comes in particular from services but not only. Thank you very much.
Christophe Menard: Thank you very much.
Operator: Thank you.
Guillaume Faury: Thank you very much.
Hélène Le Gorgeu: Thank you, Guillaume. Thank you, Xavier. This concludes our Q&A session for tonight. Before we close the call, I would like to remind you that we will be holding our Airbus 2023 Business Update in person and webcast live on the 21 June, the week of the Paris Air Show. We are very much looking forward to speak to you again on this occasion. Until then, if you have any further questions, please send an email to Philippe, Gustave, or myself, and we will get back to you as soon as possible. Thank you again.
Thank you. Thank you, Guillaume. Thank you, Xavier. So this concludes our Q&A session for tonight.
Before we close the call I would like to remind you that we will be holding our Airbus 2023 Airbus business update in person and webcast live on June 21st the week of the Paris Air Show.
We are very much looking forward to speak to you again on this occasion. But until then, if you have any further questions, please send an email to Philippe, Gusta or myself and we will get back to you as soon as possible.
Guillaume Faury: Thank you, Hélène. Thank you, Xavier. Good evening, everyone. Bye-bye.
David Perry: Thank you.
Operator: Thank you. Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant evening. Goodbye.
Thank you again. Thank you, Hélène. Thank you, Xavier. Good evening, everyone. Bye-bye. Thank you.
Thank you ladies and gentlemen the conference is now concluded and you may disconnect your telephone. Thank you for joining and have a pleasant evening. Goodbye!
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