Airbus expects to stop burning cash in the fourth quarter — provided there are no further disruptions to the world economy and air traffic.
Reporting last week on its financial results for the nine months to September, the European aerospace giant set its first formal target since withdrawing financial guidance in March.
It said it was targeting at least free cash flow before mergers and acquisitions and customer financing in the fourth quarter.
READ: Study finds aircraft COVID risk less than restaurants or shopping.
While noting the global air travel recovery was slower than anticipated, it said strong liquidity underpinned the resilience and flexibility of the business.
“After nine months of 2020 we now see the progress made on adapting our business to the new COVID-19 market environment,’’ Airbus chief executive Guillaume Faury said.
“Despite the slower air travel recovery than anticipated, we converged commercial aircraft production and deliveries in the third quarter, and we stopped cash consumption in line with our ambition.
“Furthermore, the restructuring provision booked shows our discussions with social partners and stakeholders have advanced well.
“Our ability to stabilize the cash flow in the quarter gives us confidence to issue a free cash flow guidance for the fourth quarter.”
The results reflected the significant impact of the coronavirus for revenues for the nine-month falling from €46.2 billion in the previous nine months to €30.2 billion in the latest period and 40 percent fewer aircraft deliveries.
It reported an EBIT (earnings before interest and tax) loss of €2.2 billion, including a €1.2 billion COVID restructuring provision.
Airbus shipped 145 commercial aircraft, compared to 28 for US rival Boeing, but said there was no new guidance on commercial aircraft deliveries or EBIT.
However, Reuters said Faury confirmed plans to ask suppliers to support an increase in the A320neo production rate from 40 a month to 47 in the third quarter of 2021 if demand permits.
