Airbus CFO "Reserving 10 Billion Euros to Prepare for Future Crises"

[Photo by Reuters-Yonhap News]

[Asia Economy Reporter Park Byung-hee] Airbus, Europe's largest aircraft manufacturer, announced that it has set aside 10 billion euros to prepare for future crises. Airbus also stated that the reserved funds could be used for investments such as next-generation aircraft.

According to major foreign media on the 22nd (local time), Dominique Assan, Airbus Chief Financial Officer (CFO), said that Airbus wants to remain strong even in crisis situations like COVID-19.

CFO Assan explained, "The 10 billion euros fund is like a kind of insurance."

After the COVID-19 pandemic, airlines canceled or postponed new aircraft orders, causing Airbus to face a severe liquidity crisis at one point. In the second quarter of 2020, right after the pandemic began, cash flow recorded a negative 4.4 billion euros.

However, when announcing last year's performance in February, cash flow turned positive by 3.6 billion euros, and net cash holdings increased from 4.3 billion euros at the end of 2020 to 7.6 billion euros at the end of last year.

Airbus also announced a plan to pay a dividend of 1.5 euros per share. The 1.5 euros per share dividend is planned to be paid primarily for two years. CFO Assan said it is premature to consider increasing the dividend further and that they will review dividend expansion once the net cash size reaches the target.

Airbus's financial situation contrasts with that of its competitor, the U.S. company Boeing. Boeing's net debt has significantly increased since the COVID-19 pandemic, currently reaching 45 billion dollars. Boeing's former management, who invested over 40 billion dollars in share buybacks from 2013 to 2019, is being criticized for the deteriorated financial condition.

CFO Assan emphasized that thanks to relatively sound financial status, Airbus invested much more in research and development and capital expenditures than Boeing last year.

He explained that Boeing is currently paying the price for focusing on innovation such as increasing aircraft size and that Boeing has been hit much harder than Airbus in this crisis.

Airbus currently aims to increase its monthly production volume from 50 aircraft to 75 starting in 2025. Previously, Airbus announced plans to increase monthly production to 65 aircraft by the summer of 2023.

CFO Assan said that demand for the A321 aircraft is tremendous and that orders are fully booked until 2017. He explained that the reason for increasing monthly production to 75 is to meet the A321 order volume.

This content was produced with the assistance of AI translation services.