European plane maker Airbus said it was takin action to shore up its balance sheet in the face of the COVID-19 coronavirus that has killed almost 15,000 people around the world and has brought the airline industry to its knees.
“Our first priority is protecting people while supporting efforts globally to curb the spread of the coronavirus,” Airbus said in a statement. “We are also safeguarding our business to protect the future of Airbus and to ensure we can return to efficient operations once the situation recovers. We have withdrawn our 2020 guidance due to the volatility of the situation. At the same time, we are committed to securing the liquidity of the company at all times through a prudent balance sheet policy. I am convinced that Airbus and the broader aerospace sector will overcome this critical period,” said Airbus Chief Executive Officer Guillaume Faury.
Airbus said its board had approved measures including:
- Securing a new credit facility amounting to €15 billion in addition to the existing €3 billion revolving credit facility;
- Withdrawing the 2019 dividend proposal of €1.80 per share with an overall cash value of approximately €1.4 billion;
- Suspending the voluntary top up in pension funding.
With these decisions, the company has significant liquidity available to cope with additional cash requirements related to the coronavirus. Liquidity resources previously standing at approximately €20 billion, comprising around €12 billion in financial assets at hand and around €8 billion in undrawn credit lines, were further bolstered by converting an existing €5 billion credit line into a new facility amounting to €15 billion. Available liquidity now amounts to approximately €30 billion.
By maintaining production, managing its resilient backlog, supporting its customers and securing financial flexibility for its operations, Airbus intends to secure business continuity for itself even in a protracted crisis. Safe and efficient air travel is a key backbone of global economic development and cultural exchange. Airbus therefore highly welcomes governmental efforts around the globe to stabilise this industry by supporting the financial health of its airline customers and its suppliers. Airbus continues to monitor the overall health of the industry.
Airbus has convened its 2020 Annual General Meeting in Amsterdam on 16 April. Due to the global outbreak of COVID-19, Airbus discourages physical attendance and strongly encourages shareholders to vote by proxy in line with public health and safety measures.