Airbus raises $16 billion; resumes production in France and Spain
Airbus announced further measures to fight the outbreak of COVID-19. The manufacturer has raised additional liquidity to ensure the company’s ability to be financially flexible and it has partially resumed production and assembly work in its French and Spanish sites as of March 23, 2020.
After a temporary suspension of production and final assembly in its French and Spanish sites, announced on March 17, 2020, the company aims to resume partial work at the factories on March 23, 2020. The company indicated that it has carried out “extensive work in coordination with its social partners to ensure the health and safety of its employees, while securing business continuity,” which required the temporary suspension conducted last week.
“Work stations will only re-open if they comply with the new health and safety measures in terms of hygiene, cleaning and self-distancing while improving the efficiency of operations under new working conditions,” stated Airbus’ press release.
However, where possible, the manufacturer supports home-working activities to prevent the further spread of the virus.
Airbus ensuring liquidity
The Toulouse-based aircraft builder received approval from the Board of Directors to secure a new credit facility, which sums up to $16 billion (€15 billion) with another $3.2 billion (€3 billion) of revolving credit facility. With the decision to convert the unused credit facilities, the company now has around $32 billion (€30 billion) of liquidity from the previous sum of $21 billion (€20 billion).
Furthermore, the company has suspended its 2019 dividend payout of $1.93 (€1.80), which amounts to approximately $1.5 billion (€1.4 billion), and its voluntary top-up in pension funding. Additional cost-cutting measures have been identified by the company and would be activated if the situation of the outbreak of the virus deems necessary to do so.
Due to the financial uncertainty given the current times, Airbus’ 2020 guidance is withdrawn. Previously, the company indicated that it aimed to deliver 880 aircraft throughout the year amounting to Earnings before Interest and Taxes (EBIT) to be $8.1 billion (€7.5 billion), an increase of 8.6% compared to the current EBIT result of $7.5 billion (€6.9 billion).
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