EADS: Recovery is in Sight
Berlin, 07 May 2002
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EADS CEOs, Camus and Hertrich: "EADS is positioned to drive and benefit from further growth."
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EADS defence revenues to increase by more than 50% by end of 2004; defence backlog to double with A400M contract
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EADS maintains the largest order book in global aerospace and defence industry, and expects its order backlog to rise to more than EUR 190 billion in 2002
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EADS continues strong relationships with U.S. partners; Joint pavilion with U.S. partner Northrop Grumman at ILA
EADS, the world's second largest aerospace and defence company, has seen the first indicators of recovery in the aerospace industry. EADS announced this on Tuesday at the International Aerospace Exhibition ILA 2002 at Berlin Schönefeld. This exhibition is the first major aerospace industry event to demonstrate positive signs following September 11.
The two CEOs of EADS, Philippe Camus and Rainer Hertrich said, "Recovery in the commercial aircraft business is in sight, we have positive indications including a rising number of passengers, favourable forecasts by key economic institutes, and the booking of firm commercial aircraft orders."
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EADS believes the industry will return in 2004 at the latest to the dynamic growth of previous years. With the growth in air traffic, demand for larger, yet more efficient aircraft is expected to climb.
The CEOs stated, "But the positive development needs stability. World economic and political uncertainties are still a danger for the recovery. We need to maintain a stable and positive period of growth. While we must continue to prudently manage costs and cash, leverage synergies, and consistently grow our order book, we are participating in ILA with a spirit of optimism."
Strong indicators for future growth of EADS' business are the decisions by European governments in favour of the military transport aircraft A400M, the European satellite navigation system Galileo, the military satellite communication system Skynet 5, and strong Airbus orders. EADS has successfully managed to increase its leadership, despite market challenges and September 11th.
"Thanks to our hands-on management, our production flexibility, and organizational flexibility, we can react quickly to market fluctuations. This positions EADS to emerge from the downturn strong, efficient, and highly competitive," the CEOs stressed.
In the defence business, EADS is expected to increase revenues by at least 50 percent from the current EUR 6 billion to achieve EUR 9 billion by 2004. The Company is targeting an increase in the defence portion of total revenues to 30 percent by 2012. Currently, it stands at 20 percent.
EADS has established a cross-divisional committee to provide Homeland Security solutions increasing the public's safety.
EADS is already involved in a number of significant defence programmes in the United States, such as Meads. The Meads programme, which stands for Medium Extended Air Defence System, is the first ever in which technical access has been agreed upon from both sides of the Atlantic.
The CEOs added, "EADS views the U.S. as a key strategic market in which we can deliver value and competitiveness. We realize a more significant presence will take time and attention. EADS is committed to develop the U.S. market, and firmly believes we will achieve this goal. We already materialise around seven percent of our defence revenues in the US market. This translates into almost half a billion Euro."
An example of successful transatlantic cooperation in the defence sector is the EADS and Northrop Grumman joint pavilion. The result of an on-going, two-year intensive collaboration between the two companies in the areas of reconnaissance, surveillance, sensors and data transmission, is actively visible in this pavilion. The partnership has created comprehensive solutions that meet new information superiority requirements. "We are very proud of our partnership with the U.S. manufacturer Northrop Grumman, and this is one of our major accomplishments presented at ILA," Camus and Hertrich commented.
"For us, ILA in Berlin is just as much a home venue as the Paris Air Show in Le Bourget," stated the CEOs. "EADS is an increasingly global company with a strong German, French, Spanish and British heritage."
With revenues of EUR 30.8 billion in 2001 and more than 100,000 employees, EADS European Aeronautic Defence and Space Company is Europe's largest aerospace company and the Number 2 worldwide. EADS business operations cover the civil aeronautics, helicopters, space, military transport and combat aircraft sectors as well as defence technology and services. EADS has a number of holding interests, including 80 percent in Airbus, 75 percent in the space company Astrium, 100 percent in the helicopter manufacturer Eurocopter, 43 percent in the Eurofighter programme and 37.5 percent in the guided missile producer MBDA.
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