Airbus SE

Overview Key strengths Key risks One of the two global producers of large commercial aircraft (100 seats or more), alongside Boeing, with a very strong order book. The civil aviation industry was one of the hardest-hit by the COVID-19 pandemic and we don?t expect recovery to 2019 levels before 2024. Material portfolio diversification, offering a wide range of products including civil and military aircraft, satellites, electronics, defense systems, civil and military helicopters. Product safety is a key risk for aircraft manufacturers. This is especially true for Airbus and rival Boeing, which effectively form a duopoly in global civil aircraft manufacturing. Highest market share in narrowbody civil aircraft, a segment that is currently enjoying much stronger recovery and demand for new

...Despite the pandemic, Airbus has exhibited a strong financial performance and is well positioned to benefit from the recovery, despite a complex operating environment. Flying hours significantly reduced in 2020 and 2021 during the pandemic and led to a material reduction in demand for commercial aircraft, with original equipment manufacturers, including Airbus, lowering their production rates and engaging in major restructuring and cost-cutting programs. Demand for air travel and therefore flying hours have illustrated signs of recovery through the second half of 2021 and into 2022, so the industry's prospects are steadily improving (see chart below for the IATA's revenue passenger kilometer [RPK] trend and forecast). Airbus posted a strong set of results in 2021 with profitability and cash flows above our previous expectations. Half-year 2022 results were also robust despite a complex operating environment including inflationary headwinds and some supply chain disruption. The group continues...

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