By Olivia Bugault

 

--Airbus posted a net loss of EUR1.44 billion

--The European plane maker trimmed A350 jets production rate to five from six due to virus

--Airbus didn't provide guidance for the year because of low visibility

 

Airbus SE Thursday said it swung to a net loss in its second quarter and still can't give guidance for the year.

Net loss at the European plane maker was 1.44 billion euros ($1.70 billion) compared with net profit of EUR1.16 billion a year earlier, while revenue fell 55% to EUR8.32 billion. Analysts expected sales to come in at EUR8.31 billion, according to a consensus estimate provided by FactSet.

Airbus's more closely watched adjusted earnings before interest and taxes also swung to a loss of EUR1.23 billion.

"The impact of the Covid-19 pandemic on our financials is now very visible in the second quarter, with first-half commercial aircraft deliveries halving compared to a year ago," Airbus Chief Executive Guillaume Faury said.

At the end of June, roughly 145 commercial aircraft couldn't be delivered because of the public-health crisis, the company said.

Airbus reported free cash outflow before merger and acquisition and customer financing of EUR4.4 billion in its second quarter, compared with cash outflow of EUR8.03 billion in its first quarter--which included EUR3.6 billion in regulatory fines. The group's ambition is to not consume cash before M&A and customer financing in its second half, Mr. Faury said.

Mr. Faury reiterated that Airbus will continue to focus on preserving cash as global airline traffic isn't expected to recover to pre-pandemic levels until 2024, according to the latest forecast from global trade group, the International Air Transport Association.

Airbus had already announced a series of drastic cost-cutting measures in a bid to weather the coronavirus crisis which is set to have a yearslong effect on the aviation sector. Airbus in late June said it would cut 15,000 jobs--or roughly 11% of its staff world-wide--the biggest restructuring in its history. The aerospace giant in April cut its production rate by roughly a third.

Its U.S. rival Boeing Co. on Wednesday said it plans another production cut and will shrink its workforce after posting a net loss of $2.4 billion in the second quarter.

Airbus Thursday said it has adjusted its widebody A350 monthly production rate to five from six due to the market situation. The company will progressively ramp up production once it has more visibility and, by then, it will operate minor adjustments every month, Mr. Faury said during a conference call. The demand for widebody jets should take more time to recover, he said.

The Toulouse, France-based company--which is facing the "gravest crisis the aerospace industry has ever known" as Mr. Faury previously said--still didn't provide a guidance for 2020 because of the lack of visibility.

"The recovery will be long and slow," Mr. Faury said during the call.

 

Write to Olivia Bugault at olivia.bugault@wsj.com

 

(END) Dow Jones Newswires

July 30, 2020 04:10 ET (08:10 GMT)

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