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Feb. 18, 2021, 3:56 p.m. EST

Airbus offers bleak guidance despite topping fourth-quarter earnings estimates

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By Steve Goldstein

Airbus, the European conglomerate that shares the large-jet market with Boeing, reported fourth-quarter results on Thursday that didn’t make inspiring reading.

  • The fourth-quarter numbers were actually a little better than consensus expectations. Its adjusted earnings before interest and tax dropped 35% to €1.83 billion ($2.21 billion), on a 19% drop in revenue to €19.75 billion. That was ahead of consensus expectations for an operating profit of €1.66 billion on revenue of €19.18 billion.

  • The issue was the guidance. Airbus /zigman2/quotes/208224336/delayed FR:AIR +1.20% doesn’t expect to deliver more aircraft in 2021 — as the world gets inoculated with COVID-19 vaccines — than the 566 it delivered in 2020.

  • Airbus /zigman2/quotes/210553709/delayed UK:0KVV +1.77% expects its adjusted EBIT to rise to €2 billion, after earning €1.7 billion last year and €6.95 billion in 2019.

  • Free cash flow, excluding mergers and acquisitions and customer financing, is forecast to break even.

Read: U.S. wine importers are now paying the price for Trump administration’s trade tiff with European Union

The outlook: The stock market reaction, if anything, was kind, with the shares losing about 4% in morning trade. Analysts at Bank of America said the Airbus profit guidance looks conservative, even if deliveries are unchanged this year. And management may simply be trying to set a low bar — Airbus did insert the words “at least” before setting out its 2021 guidance.

Air France-KLM /zigman2/quotes/205396176/delayed FR:AF 0.00% , a client of both Airbus and Boeing /zigman2/quotes/208579720/composite BA -0.88% , also reported results on Thursday, and said it expects capacity to return to 2019 levels by 2024, implying a more hopeful recovery to air travel.

From the archives (December 2020): Tariffs over Airbus and Boeing dispute to be lifted by the U.K. post-Brexit

/zigman2/quotes/208224336/delayed
FR : France: Euronext Paris
106.04
+1.26 +1.20%
Volume: 143,318
Aug. 8, 2022 9:57a
P/E Ratio
21.48
Dividend Yield
1.41%
Market Cap
€82.50 billion
Rev. per Employee
€413,629
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/zigman2/quotes/210553709/delayed
UK : U.K.: London
107.01
+1.87 +1.77%
Volume: 233.00
Aug. 8, 2022 8:00a
P/E Ratio
21.68
Dividend Yield
1.40%
Market Cap
€82.50 billion
Rev. per Employee
€413,629
loading...
/zigman2/quotes/205396176/delayed
FR : France: Euronext Paris
1.56
0.00 0.00%
Volume: 2.48M
Aug. 8, 2022 9:57a
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
€4.01 billion
Rev. per Employee
€267,659
loading...
/zigman2/quotes/208579720/composite
US : U.S.: NYSE
$ 165.04
-1.46 -0.88%
Volume: 4.71M
Aug. 5, 2022 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$98.00 billion
Rev. per Employee
$427,768
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