Airbus 2013 Annual Report Download - page 25

ENHANCING GLOBAL COMPETITIVENESS — ANNUAL REVIEW 2013INTERVIEW WITH THE CHIEF FINANCIAL OFFICER —
the share buyback and the dividend payment of € 469 million.
So we maintain the nancial exibility and security we need to
invest in our operations and growth. Our credit ratings further
underpin the Group’s nancial stability.
Looking ahead, I’ll be keeping a rm eye on cash generation.
In 2014 and 2015, we need to accelerate the effort on our
development programmes and we’ll be targeting breakeven
free cash ow before acquisitions. I expect to see an
improvement thereafter.
What do you say to the A350 one-off booked in 2013?
The A350 is an extremely challenging industrial programme. But
we’ve learnt a lot from previous experience. Over the past year,
we have been increasing efforts to ensure a robust ramp-up and
mature aircraft deliveries. Thanks to those efforts, the
programme remains on track for entry-into-service by the end
of the year. But the extra effort has come at a cost, and the
assessment of actual cost data points against our cost
convergence targets triggered a € 434 million charge in 2013,
reecting a higher level of recurring costs on the early aircraft.
We already launched a cost convergence project one year ago
to address the main root causes in the mid to long-term through
mitigation actions, and I am convinced that the programme will
be a key contributor to the Group’s future performance.
With over 800 aircraft already on order, the A350 XWB will be
a cornerstone for the Group for many years to come.
What sort of performance should we be expecting
from the Group in the coming period?
Looking to the year ahead, assuming a dollar euro rate of 1.35,
you should expect revenues in 2014 to be broadly stable
compared to 2013, with Airbus deliveries at roughly the same
level as last year. Underlying protability should see moderate
growth in 2014, and we are reafrming our 2015 target of a 7-8%
return on sales. You should note, this return on sales target is
based on a dollar-euro rate of 1.35 and includes the dilutive effect
of early A350 deliveries.
In addition, the strong commercial performance at Airbus has
enabled us to increase the single-aisle production rate to 46 per
month in 2016 from today’s level of 42, and our robust order
book, which is now worth around € 687 billion, is very well
diversied across the globe and gives us excellent visibility for
the years ahead.
What are the main risks to protability going forward?
Risk management and cost adherence are absolute priorities for
the Group. And I believe our disciplined approach is paying off.
From today’s perspective, one-offs should be limited to possible
charges on the A350 XWB programme, which is now entering its
most critical phase, and foreign exchange effects linked to the
pre-delivery payment mismatch and balance sheet revaluation.
Finally, how much higher can the share price go?
It's certainly been an very impressive year for the Group’s share
price, rising 89% during 2013. But I won’t be making any
predictions! I see the rise as an indication of the high
expectations the market has set for the Company. And it’s
a measure of the responsibility we carry for delivering.
Looking ahead, the management team and I are fully focused
on execution.
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