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Winning export orders
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| (€m) | 2005 | 2004 | Variation |
| Revenue | 763 | 1,304 | –41% |
| EBIT | 48 | 26 | +85% |
| Order intake | 1,840 | 1,176 | +56% |
| Order book | 20,961 | 19,897 | +5% |
The Military Transport Aircraft Division delivered higher EBIT in 2005, benefiting from the restructuring completed in the previous year. It made progress in export campaigns for all classes of aircraft, including the high-value A400M transport and refuelling aircraft based on Airbus platform, benefiting from re-equipment cycles in these areas. EADS CASA maintained its global leadership in medium and light transports, as shown by its selection for two of the largest contracts ever awarded by the Brazilian government.
EBIT rose by 85% to €48.4 million compared with €26.2 million in 2004. This reflected the successful restructuring and the absence of associated costs. Revenue was €763.3 million (2004: €1.3 billion). This decrease primarily reflects the negative (€0.5 billion) impact of the shift of revenue recognition for the A400M programme until the first quarter of 2006.
New orders totalled €1.8 billion, with both the A400M and EADS CASA medium and light aircraft winning large orders. The order book grew slightly, ending the year at €21.0 billion (2004: €19.9 billion). A number of contracts and Declarations of Intent were signed that will lead to firm orders in the 2006 financial year.
First export orders for A400M
The A400M won its first export orders, as governments sought to upgrade their old-generation, heavy transport planes. South Africa signed a firm order in April for at least eight and Malaysia signed a contract in December, which will be booked in 2006, to buy four. Added to the 180 ordered by the European launch countries, this brings the total to 192. In a sign that more orders are on the way, in July the Chilean government signed a Declaration of Intent to acquire up to three.
Additionally, the Brazilian government awarded EADS CASA two large export orders. EADS CASA will supply 12 C−295 medium transport aircraft for supporting people in the remote Amazon. It will also modernise eight P−3 maritime patrol aircraft, installing them with mission systems (
FITS). These are the biggest contracts ever signed between EADS and Latin America.
In line with EADS’ Global Industrial Development strategy, all of the Division’s export agreements involved local subcontractors.
MTA’s strategy for participating in the US defence market advanced significantly. In September, EADS joined Northrop Grumman as principal subcontractor in its bid for the US Air Force’s new-generation KC−30 refuelling aircraft. Additionally, a partnership agreement was signed in May with Raytheon to bid for the US Army’s Future Cargo Aircraft programme.
Industrial progress
Production of the A400M has started and construction of the final assembly line in Seville, Spain is under way. Continuing the change in the workforce required for the new A400M and tanker programmes, approximately 150 engineers joined the Division, taking the total workforce to around 4,000.
The first of the five A330 Multi-Role Tanker Transport Aircraft (MRTT) ordered by the Australian Defence Forces is currently being manufactured by Airbus. Three prototypes of the innovative refuelling boom, with electronic fly-by-wire controls, have been completed.
The Division’s range of military transport aircraft is well suited to the needs of governments seeking to re-equip their air forces and other services. With its superior load capacity, speed and capability for low-altitude tactical flights, the A400M is beginning to win export orders and is an obvious choice for governments looking to replace their ageing fleets of heavy transport aircraft.
The Division is bidding for a number of large contracts. MTA expects 2006 will see the Air Tanker consortium land an order from the UK government for the €14 billion Future Strategic Tanker Aircraft programme covering 14 A330 MRTTs. In the US, it is in bidding partnerships with Northrop Grumman and Raytheon in particular for the tanker replacement programme and for future cargo aircraft jointly procured by the Army and Air Force. Finally, Portugal’s early 2006 order of 12 C−295 aircraft will add to revenue.
Looking forward over the next few years, the Division will deliver higher revenue and EBIT. Both the A400M and tankers will make a substantial contribution to the expansion. Additionally, the Division is in a strong position to expand its order book in medium and light military transport aircraft.
