20 February 2025
If you are covering Airbus’ FY2025 results, please find comments below from Matt Dorset, equity analyst at Quilter Cheviot:
"Airbus' FY2025 results this morning were pretty solid. We already knew that Airbus hit its delivery guidance with 766 aircraft delivered last year. In terms of the financials, earnings (EBIT) came in slightly below expectations, partly due to another space charge which had been expected, although the magnitude at €300 million was larger than anticipated. On an underlying basis, excluding the charge, EBIT was ahead of expectations, and free cash flow (FCF) was very strong, 22% ahead of consensus.
“Looking forward to 2025, Airbus is guiding towards commercial aircraft deliveries of 820 aircraft, representing 7% growth compared to 2024. This seems slightly conservative but is understandable given ongoing supply chain issues. The company will want to avoid another cut to guidance as occurred in 2024. EBIT is guided to grow by around 30%, and FCF is expected to be flat, although this includes the negative impact of integrating some workflows from Spirit Aerosystems.
“Airbus continues to return cash to shareholders via its dividend, which was increased by 11% to €2, and it has proposed an additional special dividend of €1. Combined, this represents a yield of about 2%.
“Stepping back, the demand outlook remains incredibly strong, and Airbus has a huge order backlog. The company needs to address the supply chain issues it faces, but Airbus is still in a good competitive position relative to Boeing. The valuation continues to look fairly attractive given the expected growth Airbus should generate. Airbus trades on 15x 2026 EV/EBIT, which is a slight premium to history but cheaper than Boeing."
