Ad-hoc | 29 July 2004 07:00

EADS results grow strongly in first half year

Ad-hoc-announcement processed and transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– EADS: Ad-hoc release, July 29, 2004 EADS results grow strongly in first half year EADS first half year EBIT* of Euro 985 million, up 66 percent Net Income more than doubled to Euro 387 million Thanks to market improvements, EADS increases its 2004 EBIT* target to about Euro 2.1 billion Free Cash Flow before customer financing remains robust at Euro 259 million EADS (stock exchange symbol: EAD), the world’s second largest aerospace and defence group, has achieved strong results growth in the first half year of 2004. The company reached an EBIT* (pre-goodwill and exceptionals) of Euro 985 million in the first six months, 66 percent higher than the figure for the same period of 2003 (Euro 592 million). The EBIT* margin has increased from 4.5 percent to 6.8 percent. The EBIT* improvement was particularly driven by Airbus, which delivered twelve aircraft more than in the same period last year with a higher proportion of A330/A340 family aircraft, and by the Space Division, which had already achieved close to break-even by mid-year. As usual, the Defence businesses are expected to contribute stronger results in the second half of the year. The Defence and Security Systems Division was held back, as previously announced, by a restructuring charge in the second quarter. Thanks to the market improvements particularly in civil aviation, EADS has increased its 2004 EBIT* target to about Euro 2.1 billion, up from the previous target of Euro 1.93 billion. Free Cash Flow before customer financing amounted to Euro 259 million in the first half year (H1 2003: Euro 305 million), reflecting the strong profits and a spill-over of aircraft deliveries into the year 2004. This performance was achieved after higher investment and inventory build-up by Airbus for the A380 and capital expenditures in Space related to Paradigm. EADS maintained its strong Net Cash position at Euro 2.9 billion (year-end 2003: Euro 3.1 billion). EADS paid about Euro 300 million of dividends to its shareholders in the second quarter of 2004. EADS recorded first half year Net Income of Euro 387 million (same period 2003 pre-goodwill: Euro 177 million), or Euro 0.48 per share (H1 2003: Euro 0.22). EADS revenues increased by 12 percent in the first six months to reach Euro 14.6 billion (first half year 2003: Euro 13.1 billion). Revenues increased in all Divisions except Military Transport Aircraft, where no A400M revenue milestone was recognised before July. Outlook EADS increases its 2004 EBIT* target to about Euro 2.1 billion from Euro 1.93 billion. At the same time, EADS raises its 2004 revenues target to Euro 31 billion (previously at Euro 29 to 30 billion), based on an average exchange market rate of EUR 1 = USD 1.20. These improvements should be achieved thanks to stronger contributions from the non-Airbus Divisions in the second half of the year. At the same time, Airbus deliveries will not be at the same level of the first half year, and aircraft mix is expected to be less favourable until year-end, with a lower delivery proportion of A330/A340 family aircraft. Following the recent improvements in market demand, Airbus now expects to deliver more than 305 aircraft in 2004, which was the 2003 level, and to increase significantly deliveries in the coming years. In the first half year 2004, Airbus has already delivered 161 aircraft. Responding to the market improvement, Airbus has also decided to implement a step-by-step production rate increase, which could reach up to eight A330/A340 family aircraft per month in 2005 and up to 30 A320 family aircraft per month in 2006. The pace and the implementation of this progressive ramp-up will be closely monitored and adjusted if needed in order to follow the actual market demand. In addition, EADS confirms its previous guidance that it will achieve a positive Free Cash Flow before customer financing in 2004. * EADS uses EBIT pre goodwill amortization and exceptionals as a key indicator to measure the economic performance of the Group and its Segments. The term “exceptionals” refers to income or expenses of a non-recurring nature, such as amortization expenses of fair value adjustments relating to the EADS merger, the Airbus combination and the formation of MBDA, as well as impairment charges. Contact: Eckhard Zanger EADS Communications Finance Tel. +49 89 607 27961 end of ad-hoc-announcement (c)DGAP 29.07.2004 ——————————————————————————– WKN: 938914; ISIN: NL0000235190; Index: MDAX Listed: Amtlicher Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin- Bremen, Düsseldorf, Hamburg, Hannover, München und Stuttgart 290700 Jul 04