(BFM Stock Exchange) – During a “business update”, the group took stock of its strategy and prospects, notably stressing that beyond 2025, it would focus on value creation. The company has also noted its policy of distributing its results to shareholders. The action evolves at the top of the CAC 40.

For the markets, this meeting was much more important than the Bourget 2025 fair. Airbus organized this Wednesday 18 June a “business update”, that is to say an event during which the group exhibits its ambitions and its strategy to analysts and investors.

Organized in Paris in parallel with the Ile-de-France aeronautical show, this “Business Update” took more appearance of the investor day, if only with regard to its duration (almost four hours without break).

Analysts had their money for their money. Airbus detailed division by division both the current state of its activity as well as its ambitions, while developing its financial vision in the medium term.

Its executive president, Guillaume Faury, explained in particular that the year 2025 marked, for the aeronautical group, a “pivot” because it completes the construction of “resilience” that the company completed over the period 2022-2025, by recovering from the pandemic.

The 2025 exercise will also be used to “establish the road to profitable growth”. As of this year and beyond, Airbus will go into “value creation” mode, said the aircraft manufacturer, in its presentation.

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The rating rate enhanced

An announcement delivered by the group just before the start of this “business update” testifies to this. Airbus has decided to raise its distribution rate, that is to say the share of its net profit rendered to its shareholders in the form of a dividend.

Airbus has now targeted the top of a range from 30% to 50%, against a previous interval of 30% to 40%.

The financial director, Thomas Toepfer also recalled that the company could, beyond the ordinary dividend, use “other options in the toolbox”, such as extraordinary dividends or even action buybacks. Under 2023 and 2024, Airbus had already announced the payment of an exceptional dividend of 1 euro per share.

To finance this return to the shareholder as well as its investments and, possibly, small acquisitions which would strengthen the group in certain areas (digitization, cybersecurity), the group will generate cash.

Thomas Toepfer confirmed that the company was intended to convert all of its net profit into cash flow (before customer funding) on ​​a five -year horizon.

The generation of cash will be carried by a set of elements, in particular a stabilization provided for in 2026 of “CAPEX”, that is to say the investment expenditure provided for in the productive apparatus.

Above all, the cash will be carried by the gradual improvement of the results of the company.

Head on production increases and services

The first factor remains the rise of production of the A320 NEO family, the company’s “cash machine”. Airbus confirmed to target a production rate in this family of 75 aircraft per month by 2027. To give an idea, according to a recent survey by Royal Bank of Canada, suppliers in the sector expect Airbus to finish 2025 at a rate of 55 aircraft per month.

In addition to the increase in volumes planned via production rates, the A320 NEO family will experience an improvement in its profitability thanks to a “positive mix” effect. That is to say that Iirbus will further direct its sales to better marked versions of this family.

Thomas Toepfer explained that the A321 NEO represented 70% of the family command book and that the share of the A321 XLR, the Airbus monocourloir with the most important range of action, progressed.

Still in the civil division, Thomas Toepfer indicated that the A220 program, the family of monocourors inherited from the acquisition of the Bombardier CSERIES in 2018, would reach a rate of production of 14 aircraft per month in 2026. Once this rate has been reached and stabilized, the A220 will be at the financial balance, both on cash and the operational result.

Regarding coarse doors, that is to say the A330 and the A350, Airbus aims for respective rates of 4 aircraft and 12 aircraft per month. The two programs have been beneficiaries since 2022.

Airbus expects the repurchase and integration of certain activities of its supplier Spirit Aerosystems to allow large carriers to return to the profitability they knew before the pandemic.

The recovery of the activities of the “Defense and Espace” division will also play. After a loss of 566 million euros in 2024, the division counts on its restructuring to identify an adjusted operating profit of more than 1 billion euros in 2028. Airbus Helicopters has exactly the same target in the same horizon.

Thomas Toepfer also explained that the company intended to focus on its most profitable services (sales of spare parts, digital solutions). The services as a whole must generate income of 10 billion euros by 2030.

In terms of profitability, Thomas Toepfer, explained that the company was planning to reach an operating margin rate “Mid to High Single Digit” (4% to 9%) in services, against “Mid Single Digit” (4% to 6%) currently.

The manager has, by the way, confirmed the 2025 objectives of the company, namely around 820 aircraft deliveries, an adjusted operating profit of around 7 billion euros and a cash flow before customer financing of around 4.5 billion euros.

Washington’s little boost

On the Paris Stock Exchange, the market reacts well. The Airbus action wins 2% at the start of the afternoon, signing the highest increase in a 40-stone CAC (-0.3% at the same time).

In a note published Wednesday morning before the opening of the market, Royal Bank of Canada expected that the reaction of investors was “neutral to positive”. The Canadian Bank calculates, on the basis of consensus forecasts, that Airbus’s prospects for cash conversion could lead the group to generate between 30 billion and 35 billion euros in cash flow from 2025 to 2029.

Royal Bank of Canada, however, regrets that the company has delivered medium -term forecasts for all its divisions, except the most important, that of civil aeronautics.

“It is true but at the same time it is the division most difficult to predict of the three,” tempers an analyst. “Airbus has rather succeeded in its exercise. There is no bad news. They have left little room for doubt about the achievement of the 2025 objectives, they showed granularity and the financial director was very good,” said this expert.

“Furthermore, the increase in the dividend distribution rate is always a good thing, especially for certain funds,” he added, stressing, however, that Iirbus has little mentioned in its new programs, including the hydrogen aircraft.

The analyst believes that beyond the “business update”, the Airbus action can also be carried by another information. On Tuesday evening, the United States Secretary for Transport, Sean Duffy, spoke in favor of a return to customs duties of 0% for all civil aviation products, Reuters reported. “This is a positive element for the entire sector,” says the analyst.

Sean Duffy, however, acknowledged that civil aviation was only a component in much broader American commercial negotiations.

Since the announcement of reciprocal American customs duties, the entire aeronautical industry on both sides of the Atlantic has pleaded for a return to “Trade on Civil Aircraft” (ACCA) of 1979 had been signed by the United States and most Western countries.

To simplify, this text has established the principle of free trade on aircraft exports, eliminating import duties on devices as well as on engines and spare parts, components or flight simulators.