Year-end order backlog (valued at catalogue prices for commercial aircraft activities) consists of contracts signed up to that date. Only firm orders are included in calculating order backlog — for commercial aircraft, a firm order is defined as one for which EADS receives a non-refundable down payment on a definitive contract not containing a “walk-away” provision. Defence-related orders are included in the backlog upon signature of the related procurement contract (and the receipt, in most cases, of an advance payment). Commitments under defence “umbrella” or “framework” agreements by governmental customers are not included in backlog until they are officially notified to EADS.

For civil market contracts, amounts of order backlog reflected in the table below are derived from catalogue prices, escalated to the expected delivery date and, to the extent applicable, converted into Euro (at the corresponding hedge rate for the hedged portion of expected cash flows, and at the period-end spot rate for the non-hedged portion of expected cash flows). The amount of defence-related order backlog is equal to the contract values of the corresponding programmes.

The €76.7 billion increase in the 31^st December 2007 order backlog, to €339.5 billion, reflects an order intake at EADS in 2007 (€136.8 billion) that was more than triple the revenues accounted for in the same year (€39.1 billion). However, this favourable book-to-bill ratio was partially offset by the effect of the weaker U.S. dollar spot rate used for conversion of the non-hedged portion of the backlog into Euro, which had a negative impact of €19.9 billion at year end.

Airbus’ backlog increased by €73.7 billion from 2006, to €283.8 billion, reflecting a book-to-bill ratio of more than four with net order intake of 1,341 aircraft in 2007 (€117.3 billion). Total order backlog amounted to 3,421 aircraft at the end of 2007 (as compared to 2,533 aircraft at the end of 2006). However, the positive book-to-bill ratio was partially offset by negative net foreign currency adjustments to the backlog, reflecting the year-end valuation of the non-hedged portion of Airbus’ order backlog.

The MTA Division’s backlog decreased by €0.4 billion from 2006, to €19.9 billion, reflecting a book-to-bill ratio of less than one. Revenues recognised in the MTA Division (€1.1 billion) were partially offset by an order intake of €0.8 billion in 2007, driven by orders for eleven C-295 aircraft and seven CN-235 aircraft.

The Eurocopter Division’s backlog posted a solid €2.5 billion increase from 2006, to €13.5 billion, reflecting a book-to-bill ratio of more than one with new orders of €6.6 billion. This strong order intake consisted of 802 total new orders in 2007 (as compared to 615 in 2006), bringing its order backlog to 1,388 helicopters at the end of 2007 (as compared to 1,074 helicopters at the end of 2006).

Despite the change of consolidation effect (€(1.7) billion) relating to MBDA, the DS Division’s backlog increased by €0.3 billion from 2006, to €17.9 billion, reflecting a book-to-bill ratio of more than one with new orders of €7.5 billion. Order intake was driven by orders for military air systems and secured communication networks, in particular an order for 72 Eurofighter aircraft from Saudi Arabia.

Astrium’s backlog increased by €0.6 billion from 2006, to €12.9 billion, reflecting a book-to-bill ratio of more than one with new orders of €4.5 billion, especially in telecommunication satellites (including 2 satellites for the Yahsat secure satellite communications system in the U.A.E.) and M51 missile systems.

The amounts recorded under “Headquarters/Consolidation” primarily reflect the elimination of Airbus’ work share in the A400M programme. The MTA Division’s order backlog includes 100% of the value of the A400M order to reflect the Division’s prime-contractor responsibility over the programme. The effect of internal subcontracting (corresponding to the work share of other EADS divisions on the A400M programme) is therefore eliminated in EADS’ consolidated order backlog.

The table below illustrates the proportion of commercial and defence backlog at the end of each of the past three years.