2014
ANNUAL REPORTREGISTRATIONDOCUMENT

2014
ANNUAL REPORTREGISTRATIONDOCUMENT
2014

Airbus Group N.V. (the “Company” and together with its
subsidiaries the “Group”) is a Dutch company, which is listed
in France, Germany and Spain. The applicable regulations withrespect to public information and protection of investors, aswell as the commitments made by the Company to securities
and market authorities, are described in this Registration
Document (the “Registration Document”).
The Group has been rebranded as Airbus Group as of
2 January 2014. The Company’s legal name change into
Airbus Group N.V. was submitted to the Company’s Annual
General Meeting of Shareholders (the “AGM”) on 27 May
2014 and was approved.
In addition to historical information, this Registration Document
includes forward-looking statements. The forward-looking
statements are generally identiﬁed by the use of forwardlooking words, such as “anticipate”, “believe”, “estimate”,“expect”, “intend”, “plan”, “project”, “predict”, “will”, “should”,“may” or other variations of such terms, or by discussion ofstrategy. These statements relate to the Company’s future
prospects, developments and business strategies and are
based on analyses or forecasts of future results and estimatesof amounts not yet determinable. These forward-looking
statements represent the view of the Company only as of02

the dates they are made, and the Company disclaims any
obligation to update forward-looking statements, except
as may be otherwise required by law. The forward-looking
statements in this Registration Document involve known andunknown risks, uncertainties and other factors that could
cause the Company’s actual future results, performanceand achievements to differ materially from those forecasted
or suggested herein. These include changes in general
economic and business conditions, as well as the factors
described under “Risk Factors” below.
This Registration Document was prepared inaccordance with Annex 1 of EC Regulation 809 / 2004,
ﬁled in English with, and approved by, the Autoriteit
Financiële Markten (the “AFM”) on 16 April 2015 inits capacity as competent authority under the Wet
op het ﬁnancieel toezicht (as amended) pursuant to
Directive 2003 / 71 / EC. This Registration Document
may be used in support of a ﬁnancial transaction as a
document forming part of a prospectus in accordancewith Directive 2003 / 71 / EC only if it is supplemented
by a securities note and a summary approved by the
AFM.

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2014

REGISTRATIONDOCUMENT
Risk Factors

1

Information on the Group’s Activities

2

Management’s Discussion
and Analysis of Financial Condition
and Results of Operations

3

General Description of the Company
and its Share Capital4

Corporate Governance5

Entity Responsible for the Registration
Document

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02
Management’s Discussion
and Analysis of Financial Condition
and Results of Operations

55

12

2.1

56

Legal Risks

17

2.1.1 Overview

Industrial and Environmental Risks

19

Risk Factors

07

1.

Financial Market Risks

08

2.

Business-Related Risks

3.
4.

01
Information on the Group’s Activities 21
1.1

Presentation of the Group

22

1.1.1

Overview

22

1.1.2 Airbus

25

1.1.3 Airbus Helicopters

31

1.1.4 Airbus Defence and Space34

1.1.5 Other Businesses

41

1.1.6 Investments

43

1.1.7 Insurance

44

1.1.8 Legal and Arbitration Proceedings

45

1.1.9 Research and Technology, Intellectual Property

47

1.1.10 Environmental Protection

48

1.1.11 Employees

51

1.1.12 Incorporation by Reference

52

1.2

53

Recent Developments

Operating and Financial Review

57

2.1.2 Critical Accounting Considerations,
Policies and Estimates

58

2.1.3 Performance Measures

63

2.1.4 Results of Operations

67

2.1.5 Changes in Consolidated Total Equity(Including Non-Controlling Interests)

71

2.1.6 Liquidity and Capital Resources72

2.1.7 Hedging Activities

79

2.2

Financial Statements

80

2.3

Statutory Auditors’ Fees

81

2.4

Information Regarding the Statutory
Auditors

81

03
General Description of the Company
and its Share Capital
83
3.1

General Description of the Company

84

3.1.1 Commercial and Corporate Names,
Seat and Registered Ofﬁce

84

3.1.2 Legal Form

84

3.1.3 Governing Laws and Disclosures84

3.1.4 Date of Incorporation and Duration of the Company 86

04

3.1.5 Objects of the Company

86

3.1.6 Commercial and Companies Registry86

3.1.7 Inspection of Corporate Documents

86

3.1.8 Financial Year87

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GENERAL TABLE OF CONTENTSREGISTRATION DOCUMENT
201404
3.1.9 Allocation and Distribution of Income

87

3.1.10 General Meetings

87

3.1.11 Disclosure of Holdings

89

3.1.12 Mandatory Disposal
3.1.13 Mandatory Offers

3.2

General Description of the Share Capital

Corporate Governance

111

90

4.1

Management and Control

112

91

4.1.1 Corporate Governance Arrangements

112

4.1.2 Corporate Governance Arrangements in 2014

115

92

3.2.1 Issued Share Capital

92

4.1.3 Dutch Corporate Governance Code,“Comply or Explain”

125

3.2.2 Authorised Share Capital

92

4.1.4 Enterprise Risk Management System

126

4.1.5 Ethics and Compliance Organisation

131

3.2.3 Modiﬁcation of Share Capitalor Rights Attached to the Shares

92

3.2.4 Securities Granting Accessto the Company’s Share Capital

93

4.2

3.2.5 Changes in the Issued Share Capital
since Incorporation of the Company

3.3

Shareholdings and Voting Rights

94

96

Interests of Directors and Principal
Executive Ofﬁcers

132

4.2.1 Remuneration Policy

132

4.2.2 Long-Term Incentives Granted to the Chief
Executive Ofﬁcer

140

4.2.3 Related Party Transactions

140

3.3.1 Shareholding Structure at the end of 2014

96

3.3.2 Relationships with Principal Shareholders

97

3.3.3 Form of Shares

100

3.3.4 Changes in the Shareholding of the Company
since its Incorporation

101

4.3.2 Employee Share Ownership Plans

141

3.3.5 Persons Exercising Control over the Company

103

4.3.3 Long-Term Incentive Plans

142

3.3.6 Simpliﬁed Group Structure Chart

103

3.3.7 Purchase by the Company of its Own Shares

105

3.4

107

4.3

Employee Proﬁt Sharing
and Incentive Plans

141

4.3.1 Employee Proﬁt Sharing and Incentive Agreements 141

05
Dividends

3.4.1 Dividends and Cash Distributions Paid
Since the Incorporation of the Company

107

3.4.2 Dividend Policy of the Company

108

3.4.3 Unclaimed Dividends

108

3.4.4 Taxation

108

3.5

109

Annual Securities Disclosure Report

Entity Responsible
for the Registration Document
5.1

149

Entity Responsible for the Registration
Document

150

5.2

Statement of the Entity Responsible
for the Registration Document

150

5.3

Information Policy

151

5.4

Undertakings of the Company
regarding Information

151

Signiﬁcant Changes

151

5.5

AIRBUS GROUP REGISTRATION DOCUMENT 2014

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RISK

FACTORS06

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Risk Factors
1.

Financial Market Risks

08

2.

Business-Related Risks

12

3.

Legal Risks

17

4.

Industrial and Environmental Risks

19

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Risk Factors
1 Financial Market Risks

The Company is subject to many risks and uncertainties that may affect its
ﬁnancial performance. The business, results of operation or ﬁnancial conditionof the Company could be materially adversely affected by the risks described
below. These are not the only risks the Company faces. Additional risks anduncertainties not presently known to the Company or that it currently considers
immaterial may also impair its business and operations.

1. Financial Market Risks
Global Economic and Sovereign Debt Concerns
As a global company, the Company’s operations and performance
depend signiﬁcantly on market and economic conditions in Europe,
the US, Asia and the rest of the world. Market disruptions andsigniﬁ cant economic downturns may develop quickly due to,among other things, crises affecting credit or liquidity markets,regional or global recessions, sharp ﬂuctuations in commodity
prices (including oil), currency exchange rates or interest rates,
inflation or deflation, sovereign debt and bank debt rating
downgrades, restructurings or defaults, or adverse geopoliticalevents (including those in the Middle East, Ukraine, Africa andother regions). Any such disruption or downturn could affect theCompany’s activities for short or extended periods and have anegative effect on the Company’s future results of operation andﬁnancial condition.
European ﬁnancial markets have, in recent years, experienced
signiﬁ cant disruptions as a result of concerns regarding theability of certain countries in the euro-zone to reduce their budget
deﬁcits and reﬁnance or repay their sovereign debt obligations
as they come due. The European Central Bank and euro-zone
policy makers have so far succeeded to stabilise the euro-zone
and the European banks. However, austerity measures as well
as lower credit supply to the real economy have slowed down
economic activity and as a result consumer prices are far below thetarget levels. The European Central Bank launched an expansive
monetary policy in order to ﬁght against deﬂationary trends, induce
economic growth and complement structural reforms. The policy
includes negative rates and an open-ended quantitative easing
programme of about € 1.1 trillion which triggered a weakeningof the euro. Political hurdles remain a drag to overcome the EUsovereign debt crisis and on medium term economic prospects
despite signs of recovery. The asset quality and the equity bufferof most European banks have been assessed as appropriate by
the European Central Bank.

08

The Federal Reserve Bank stopped completely its purchasesof government bonds and mortgage backed securities in
October 2014 which provides the basis for an increase of
reﬁnancing rates in the near future. The strong labour market, therecovery of the housing prices, and low energy cost support therecovery of the US economy. However, a further strengtheningof the US dollar may reduce the growth dynamic in the US. Thisand the contained inﬂation might delay the beginning of a rate
hike cycle. Medium term concerns about the increasing budget
deﬁcit and the sustainability of sovereign debt will likely have to beaddressed over the next several years through a combination of tax
increases, agreed budget cuts or budget sequestration in defence
and entitlement spending, combined with an increase in the debt
ceiling to ﬁnance further borrowing. This could negatively affecteconomic growth in the US and worldwide, the creditworthinessof US Treasury securities and the exchange rate of the US dollar
against other major currencies (in particular euro or pound sterling),
which may in turn adversely impact the Company’s sales in the
defence sector, the market value of the Company’s investmentsor the exchange rates at which the Company is able to hedge its
foreign currency exposure.
The reduction of monetary easing by the Federal Reserve Bankand the expected increase of US treasury yields impact ﬁnancial
markets of emerging countries, in particular those with high current
account deﬁ cits. Contagion effects to other emerging market
countries are also likely. The continued reallocation of investments
to the US might further weaken emerging market currencies mainly
against the US dollar and deteriorates the reﬁnancing conditions for
issuers from emerging countries including our customers in thesecountries. Market interventions of emerging markets’ central banks
to avoid the weakening of their local currency, such as hiking theirreﬁnancing rates or the purchase of their local currency against
foreign currency reserves, are limited. The mixture from tightening
reﬁnancing conditions and weaker emerging market currencies
might affect the economic growth in emerging markets which inturn might also lower global growth expectations.

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Risk Factors
1 Financial Market Risks

If economic conditions were to deteriorate, or if more pronounced
market disruptions were to occur, there could be a new orincremental tightening in the credit markets, low liquidity, andextreme volatility in credit, currency, commodity and equity
markets. This could have a number of effects on the Company’sbusiness, including:requests by customers to postpone or cancel existing orders
for aircraft (including helicopters) or decision by customers toreview their order intake strategy due to, among other things,
lack of adequate credit supply from the market to ﬁ nanceaircraft purchases or change in operating costs or weak levelsof passenger demand for air travel and cargo activity moregenerally;■an increase in the amount of sales ﬁnancing that the Company
must provide to its customers to support aircraft purchases,
thereby increasing its exposure to the risk of customer defaults
despite any security interests the Company might have in theunderlying aircraft;■further reductions in public spending for defence, homeland
security and space activities, which go beyond those budget
consolidation measures already proposed by governments
around the world;■
ﬁnancial instability, inability to obtain credit or insolvency of key
suppliers and subcontractors, thereby impacting the Company’s
ability to meet its customer obligations in a satisfactory andtimely manner;■continued de-leveraging as well as mergers, rating downgrades
and bankruptcies of banks or other ﬁnancial institutions, resulting
in a smaller universe of counterparties and lower availability ofcredit, which may in turn reduce the availability of bank guarantees
needed by the Company for its businesses or restrict its ability
to implement desired foreign currency hedges;■
default of investment or derivative counterparties and otherfinancial institutions, which could negatively impact theCompany’s treasury operations including the cash assets of
the Company; and■decreased performance of the Group’s cash investments due
to low and partly negative interest rates.
■

The Company’s ﬁnancial results could also be negatively affected
depending on gains or losses realised on the sale or exchangeof financial instruments; impairment charges resulting fromrevaluations of debt and equity securities and other investments;
interest rates; cash balances; and changes in fair value ofderivative instruments. Increased volatility in the ﬁnancial markets
and overall economic uncertainty would increase the risk of theactual amounts realised in the future on the Company’s ﬁnancial
instruments differing signiﬁcantly from the fair values currently
assigned to them.

Foreign Currency Exposure
A signiﬁcant portion of the Company’s revenues is denominatedin US dollars, while a major portion of its costs is incurred in euro,
and to a lesser extent, in pounds sterling. Consequently, to theextent that the Company does not use ﬁnancial instruments tohedge its exposure resulting from this foreign currency mismatch,
its proﬁ ts will be affected by market changes in the exchange
rate of the US dollar against these currencies. The Company has
therefore implemented a long-term hedging portfolio to help secure
the rates at which a portion of its future US dollar-denominatedrevenues (arising primarily at Airbus) are converted into euro orpound sterling, in order to manage and minimise this foreign
currency exposure.
There are complexities inherent in determining whether and when
foreign currency exposure of the Company will materialise, inparticular given the possibility of unpredictable revenue variations
arising from order cancellations, postponements or delivery delays.
The Company may also have difﬁculty in fully implementing its
hedging strategy if its hedging counterparties are unwilling toincrease derivatives risk limits with the Company, and is exposedto the risk of non-performance or default by these hedging
counterparties. The exchange rates at which the Company is able
to hedge its foreign currency exposure may also deteriorate, as theeuro could appreciate against the US dollar for some time as it has
been the case in the past and as the higher capital requirements forbanks result in higher credit charges for uncollateralised derivatives.
Accordingly, the Company’s foreign currency hedging strategy
may not protect it from signiﬁcant changes in the exchange rate of
the US dollar to the euro and the pound sterling, in particular overthe long term, which could have a negative effect on its results ofoperation and ﬁnancial condition. In addition, the portion of theCompany’s US dollar-denominated revenues that is not hedged inaccordance with the Company’s hedging strategy will be exposed
to changes in exchange rates, which may be signiﬁcant.
When effectively hedged, the Company recognises fair valuechanges of the derivative portfolio in equity until instruments’maturity. If the US dollar appreciates against the euro comparedto the rate at which the Company has hedged its future US dollar
denominated revenues the mark to market of the derivative portfolio
becomes negative. Hence, the Company’s equity is accordingly
reduced which could eventually result into restrictions of equity
otherwise available for dividend distribution or share buy-backs.
Currency exchange rate ﬂuctuations in those currencies otherthan the US dollar in which the Company incurs its principal
manufacturing expenses (mainly the euro) may affect the abilityof the Company to compete with competitors whose costs are
incurred in other currencies. This is particularly true with respect
to ﬂuctuations relative to the US dollar, as many of the Company’s
products and those of its competitors (e.g., in the defence export

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Risk Factors
1 Financial Market Risks

market) are priced in US dollars. The Company’s ability to competewith competitors may be eroded to the extent that any of theCompany’s principal currencies appreciates in value against the
principal currencies of such competitors.
The Company’s consolidated revenues, costs, assets and liabilities
denominated in currencies other than the euro are translated into
the euro for the purposes of compiling its ﬁnancial statements.
Changes in the value of these currencies relative to the euro
will therefore have an effect on the euro value of the Company’s
reported revenues, costs, earnings before interest and taxes, pre-goodwill impairment and exceptionals (“EBIT*”), other ﬁnancial
result, assets and liabilities.
See “— Management’s Discussion and Analysis of Financial
Condition and Results of Operations — 2.1.7 Hedging Activities”
for a discussion of the Company’s foreign currency hedging
strategy. See “— Management’s Discussion and Analysisof Financial Condition and Results of Operations — 2.1.2.5
Accounting for Hedged Foreign Exchange Transactions in the
Financial Statements” for a summary of the Company’s accounting
treatment of foreign currency hedging transactions.

Sales Financing Arrangements
In support of sales, the Company may agree to participate in theﬁnancing of selected customers. As a result, the Company has aportfolio of leases and other ﬁnancing arrangements with airlines
and other customers. The risks arising from the Company’s sales
ﬁnancing activities may be classiﬁed into two categories: (i) credit
risk, which concerns the customer’s ability to perform its obligations
under a ﬁnancing arrangement, and (ii) aircraft value risk, whichprimarily relates to unexpected decreases in the future value ofaircraft. Measures taken by the Company to mitigate these risks
include optimised ﬁnancing and legal structures, diversiﬁcation overa number of aircraft and customers, credit analysis of ﬁnancing
counterparties, provisioning for the credit and asset value exposure,and transfers of exposure to third parties. No assurances may be
given that these measures will protect the Company from defaults
by its customers or signiﬁcant decreases in the value of the ﬁnanced
aircraft in the resale market.
The Company’s sales ﬁnancing arrangements expose it to aircraft
value risk, because it generally retains security interests in aircraft forthe purpose of securing customers’ performance of their ﬁnancial
obligations to the Company, and/or because it may guarantee a
portion of the value of certain aircraft at certain anniversaries fromtheir delivery to customers. Under adverse market conditions,the market for used aircraft could become illiquid and the market
value of used aircraft could signiﬁcantly decrease below projectedamounts. In the event of a ﬁnancing customer default at a time whenthe market value for a used aircraft has unexpectedly decreased,
the Company would be exposed to the difference between theoutstanding loan amount and the market value of the aircraft, netof ancillary costs (such as maintenance and remarketing costs,etc.). Similarly, if an unexpected decrease in the market value ofa given aircraft coincided with the exercise window date of anasset value guarantee with respect to that aircraft, the Company
would be exposed to losing as much as the difference between
the market value of such aircraft and the guaranteed amount,though such amounts are usually capped. The Company regularly
reviews its exposure to asset values and adapts its provisioning
policy in accordance with market ﬁndings and its own experience.
However, no assurances may be given that the provisions taken by
the Company will be sufﬁcient to cover these potential shortfalls.
Through the Airbus Asset Management department or as a resultof past ﬁnancing transactions, the Company is the owner of usedaircraft, exposing it directly to ﬂuctuations in the market value ofthese used aircraft.
In addition, the Company has outstanding backstop commitments
to provide ﬁnancing related to orders on Airbus’ and ATR’s backlog.
While past experience suggests it is unlikely that all such proposed
ﬁ nancing actually will be implemented, the Company’s sales
ﬁ nancing exposure could rise in line with future sales growthdepending on the agreement reached with customers. Despite themeasures taken by the Company to mitigate the risks arising fromsales ﬁnancing activities as discussed above, the Company remains
exposed to the risk of defaults by its customers or signiﬁ cantdecreases in the value of the ﬁnanced aircraft in the resale market,
which may have a negative effect on its future results of operationand ﬁnancial condition.

Counterparty Credit
In addition to the credit risk relating to sales ﬁnancing as discussed
above, the Company is exposed to credit risk to the extent of
non-performance by its counterparties for ﬁnancial instruments,
such as hedging instruments and cash investments. However, theGroup has policies in place to avoid concentrations of credit risk
and to ensure that credit risk exposure is limited.
*

10Counterparties for transactions in cash, cash equivalents andsecurities as well as for derivative transactions are limited tohighly rated ﬁ nancial institutions, corporates or sovereigns.
The Company’s credit limit system assigns maximum exposurelines to such counterparties, based on a minimum credit rating
threshold as published by Standard & Poor’s, Moody’s and Fitch

Unless otherwise indicated, EBIT* ﬁgures presented in this report are Earning before Interest and Taxes, pre goodwill impairment and exceptionals.

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Risk Factors
1 Financial Market Risks

Ratings. Besides the credit rating, the limit system also takes
into account fundamental counterparty data, as well as sector
and maturity allocations and further qualitative and quantitative
criteria such as credit risk indicators. The credit exposure of theCompany is reviewed on a regular basis and the respective limits
are regularly monitored and updated. The Company also seeks tomaintain a certain level of diversiﬁ cation in its portfolio between
individual counterparties as well as between ﬁnancial institutions,
corporates and sovereigns in order to avoid an increased
concentration of credit risk on only a few counterparties.
However, there can be no assurance that the Company will not
lose the beneﬁ t of certain derivatives or cash investments incase of a systemic market disruption. In such circumstances, thevalue and liquidity of these ﬁ nancial instruments could decline
and result in a signiﬁ cant impairment, which may in turn havea negative effect on the Company’s future results of operationand ﬁ nancial condition.
Moreover, the progressive implementation of new financial
regulations (Basel III, EMIR, CRD4, Bank Restructuring Resolution
Directive, Dodd Frank Act, Volcker Rules, etc.) will have an impact
on the business model of banks (for example, the split between
investment banking and commercial banking activities) and on
the capital structure and cost of such banks’ activities in relation
to over-the-counter derivatives, and therefore on the funding
consequences of central clearing and collateralisation of overthe-counter derivatives for corporations like the Company. This
may ultimately increase the cost and reduce the liquidity of theCompany’s long-term hedges, for example, as banks seek to either
pass-on the additional costs to their corporate counterparties orwithdraw from low-proﬁt businesses altogether.

Equity Investment Portfolio
The Company holds several equity investments for industrial
or strategic reasons, the business rationale for which may varyover the life of the investment. Equity investments are either
accounted for using the equity method (associated companies),
if the Company has the ability to exercise signiﬁcant inﬂuence, orat fair value. If fair value is not readily determinable, the investment
is measured at cost.
The Company’s principal investment in associates is still Dassault
Aviation despite the disposal of 810,072 shares in 2014. The
book value of this investment was € 2.4 billion as of 31 December
2014. The Company is exposed to the risk of unexpected material
adverse changes in the fair value of Dassault Aviation and that ofother associated companies. For equity investments other thanassociates, which make up only a fraction of the Company’s total
assets, the Company regards the risk of negative changes in fairvalue or impairments on these investments as non-signiﬁcant.
Treasury shares held by the Company are not considered to beequity investments. Additionally, treasury shares are not regarded
as being exposed to risk, as any change in value of treasury sharesis recognised directly in equity only when sold to the market andnever affects net income. Treasury shares are primarily held tohedge the dilution risk arising from employee stock ownershipplans and the exercise by employees of stock options.

Pension Commitments
The Company participates in several pension plans for both
executive as well as non-executive employees, some of which are
underfunded. For information related to these plans, see “Notes
to the Consolidated Financial Statements (IFRS) — Note 25b:
Provisions for retirement plans”. Although the Company hasrecorded a provision in its balance sheet for its share of theunderfunding based on current estimates, there can be noassurance that these estimates will not be revised upward in the
future, leading the Company to record additional provisions in
respect of such plans.

Necessary adjustments of such provisions are driven by (i) the
discount factor (dependent in part on interest rates) and theinﬂ ation rate applied to calculate the net present value of thepension liabilities, (ii) the performance of the asset classes
which are represented in the pension assets, and (iii) additional
cash injections contributed by the Company from time to timeto the pension assets. The Company has taken measures toreduce potential losses on the pension assets and to better
match the characteristics of the pension liabilities with those of
the pension assets as a long-term objective. Nevertheless, any
required additional provisions would have a negative effect on the
Company’s total equity (net of deferred taxes), which could in turnhave a negative effect on its future ﬁnancial condition.

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Risk Factors
2 Business-Related Risks

Tax Issues
As a multinational group with operations in numerous jurisdictions
and sales around the world, the Company is subject to tax
legislation in a number of countries. It is the Company’s priority
target to adhere to the relevant tax regulations in these countries
and to ensure tax compliance. The Company manages its businessso as to create value from the synergies and commercial capacities
of its different entities, and therefore endeavours to structure its
operations and transactions in a tax-efﬁcient manner. The structureof the Company’s organisation and of the transactions it enters
into are based on its own interpretations of applicable tax laws andregulations, generally relying on opinions received from internal or
independent tax counsel, and, to the extent necessary, on rulingsor speciﬁc guidance from competent tax authorities. There canbe no assurance that the tax authorities will not seek to challengesuch interpretations, in which case the Company or its afﬁliates
could become subject to tax claims. Moreover, the tax laws andregulations that apply to the Company’s business may be amended
by the tax authorities — for example as a result of changes in ﬁscal
circumstances or priorities — which could affect the overall tax
efﬁciency of the Company.
For further information relating to ﬁnancial market risks and theways in which the Company attempts to manage these risks,see “— Notes to the Consolidated Financial Statements (IFRS) —Note 34a: Financial risk management”.

2. Business-Related Risks
Commercial Aircraft Market Cyclicality
Historically, the market for commercial aircraft has shown cyclicaltrends, due in part to changes in passenger demand for air
travel and cargo activity, which are in turn primarily inﬂuenced
by economic or gross domestic product (“GDP”) growth. Other
factors, however, play an important role in determining the market
for commercial aircraft, such as (i) the average age and technicalobsolescence of the ﬂeet relative to new aircraft, (ii) the number
and characteristics of aircraft taken out of service and parked
pending potential return into service, (iii) passenger and freight loadfactors, (iv) airline pricing policies, (v) airline ﬁnancial health and theavailability of outside ﬁnancing for aircraft purchases, (vi) evolutionof fuel price, (vii) deregulation and (viii) environmental constraints
imposed upon aircraft operations. The market for commercial
aircraft could continue to be cyclical, and downturns in broad
economic trends may have a negative effect on its future resultsof operation and ﬁnancial condition.
The commercial helicopter market could also be inﬂuenced by anumber of factors listed above.

Terrorism, Pandemics and Other Catastrophic Events
As past terrorist attacks and the spread of pandemics (such as
H1N1 ﬂ u) have demonstrated, terrorism and pandemics may
negatively affect public perception of air travel safety and comfort,
which may in turn reduce demand for air travel and commercial
aircraft. The outbreak of wars, riots or political unrest in a given
region may also affect the willingness of the public to travel by air.
Furthermore, major airplane crashes may have a negative effecton the public’s or regulators’ perceptions of the safety of a givenclass of aircraft, form of design, airline or air trafﬁc. As a result ofterrorism, geopolitical instability, pandemics and other catastrophic
events, an airline may be confronted with sudden reduced demand
for air travel and be compelled to take costly security and safetymeasures. In response to such events, and the resulting negative
impact on the airline industry or particular airlines, the Company

12

may suffer from a decline in demand for all or certain types of its
aircraft or other products, and the Company’s customers may
postpone delivery or cancel orders.
In addition to affecting demand for its products, the occurrenceof catastrophic events could disrupt the Company’s internal
operations or its ability to deliver products and services tocustomers. Disruptions may be related to threats to physicalsecurity and infrastructure, information technology or cyber-attacks
or failures, damaging weather or acts of nature and other crises.
Any signiﬁcant production delays, or any destruction, manipulation,
theft or improper use of the Company’s data, information systems or
networks could have a signiﬁcant adverse effect on the Company’s
future results of operation and ﬁnancial condition as well as on the
reputation of the Company and its products and services.

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Dependence on Key Suppliers and Subcontractors
The Company is dependent on numerous key suppliers andsubcontractors to provide it with the raw materials, parts,
assemblies and systems that it needs to manufacture its products.
The Company relies upon the good performance of its suppliers
and subcontractors to meet the obligations deﬁned under theircontracts. Supplier performance is continually monitored andassessed so that supplier development programmes can belaunched if performance standards fall below expectations. No
assurance can be given that these measures will fully protect theCompany from non-performance of a supplier which could disrupt
production and in turn may have a negative effect on its future
results of operation and ﬁnancial condition.
Changes to the Company’s production or development schedules
may impact suppliers so that they initiate claims under theircontracts for ﬁnancial compensation. However the robust, longterm nature of the contracts and a structured process to manage
such claims, limits the Company’s exposure. Despite thesemitigation measures, there could still be a negative effect on the
future results of operation and ﬁnancial condition of the Company.
As the Company’s global sourcing footprint extends, some
suppliers (or their sub-tier suppliers) may have production facilities
located in countries that are exposed to socio-political unrest or

natural catastrophes which could interrupt deliveries. Countrybased risk assessment is applied by the Company to monitor such
exposures and to ensure that appropriate mitigation plans or fallback solutions are available for deliveries from zones considered
at risk. Despite these measures, the Company remains exposed
to interrupted deliveries from suppliers impacted by such events
which could have a negative effect on the future results of operationand ﬁnancial condition of the Company.
Suppliers (or their sub-tier suppliers) may also experience ﬁnancial
difﬁculties requiring them to ﬁle for bankruptcy protection, which
could disrupt the supply of materials and parts to the Company.
However, ﬁnancial health of suppliers is analysed prior to selection
to minimise such exposure and then monitored during the contract
period to enable the Company to take action to avoid suchsituations. In exceptional circumstances, the Company may berequired to provide ﬁnancial support to a supplier and therefore face
limited credit risk exposure. If insolvency of a supplier does occur,
the Company works closely with the appointed administrators tosafeguard contractual deliveries from the supplier. Despite thesemitigation measures, the bankruptcy of a key supplier could still
have a negative effect on the future results of operation andﬁnancial condition of the Company.

Industrial Ramp-Up
As a result of the large number of new orders for aircraft recorded
in recent years, the Company intends to accelerate its productionin order to meet the agreed upon delivery schedules for such new
aircraft (including helicopters). The Company’s ability to further
increase its production rate will be dependent upon a variety
of factors, including execution of internal performance plans,availability of raw materials, parts (such as aluminium, titanium
and composites) and skilled employees given high demand by
the Company and its competitors, conversion of raw materials
into parts and assemblies, and performance by suppliers
and subcontractors (particularly suppliers of buyer-furnishedequipment) who may experience resource or ﬁnancial constraints
due to ramp-up. Management of such factors is also complicatedby the development of new aircraft programmes in parallel, acrossthe three Divisions, which carry their own resource demands.
Therefore, the failure of any or all of these factors could lead tomissed delivery commitments, and depending on the length ofdelay in meeting delivery commitments, could lead to additionalcosts and customers’ rescheduling or terminating their orders.
Good progress has been made in 2014 and the supply chain is in
general more stable. Speciﬁc areas of risk with suppliers of cabinequipment continue to be carefully managed.

Technologically Advanced Products and Services
The Company offers its customers products and services thatare technologically advanced, the design and manufacturing of
which can be complex and require substantial integration andcoordination along the supply chain. In addition, most of theCompany’s products must function under demanding operating
conditions. Even though the Company believes it employs
sophisticated design, manufacturing and testing practices, there
can be no assurance that the Company’s products or services

will be successfully developed, manufactured or operated or thatthey will perform as intended.
Certain of the Company’s contracts require it to forfeit part ofits expected proﬁt, to receive reduced payments, to provide a
replacement launch or other products or services, to provide
cancellation rights, or to reduce the price of subsequent sales tothe same customer if its products fail to be delivered on time or to

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perform adequately. No assurances can be given that performance
penalties or contract cancellations will not be imposed should
the Company fail to meet delivery schedules or other measuresof contract performance — in particular with respect to new
development programmes such as the A350 XWB, A400M, EC175
or H160 and to modernisation programmes such as the A320neo
and the A330neo. See “— Programme-Speciﬁc Risks” below.
In addition to the risk of contract cancellations, the Company
may also incur signiﬁcant costs or loss of revenues in connection
with remedial action required to correct any performance issues
detected in its products or services. For example, following thediscovery of hairline cracks in the wing rib feet of certain inservice A380 aircraft in 2011, the Company recorded charges

for estimated warranty and repair costs for delivered aircraft.
See “— Management’s Discussion and Analysis of Financial
Condition and Results of Operations — 2.1.1.3 Significant
Programme Developments, Restructuring and Related Financial
Consequences in 2012, 2013 and 2014”. Moreover, to the extent
that a performance issue is considered to have a possible impact
on safety, regulators could suspend the authorisation for theaffected product or service.
Any signiﬁcant problems with the development, manufacturing,
operation or performance of the Company’s products and services
could have a signiﬁcant adverse effect on the Company’s future
results of operation and ﬁ nancial condition as well as on the
reputation of the Company and its products and services.

Dependence on Public Spending and on Certain Markets
In any single market, public spending (including defence andsecurity spending) depends on a complex mix of geopoliticalconsiderations and budgetary constraints, and may therefore be
subject to signiﬁcant ﬂuctuations from year to year and country tocountry. Due to the overall economic environment and competingbudget priorities, several countries have reduced their level of
public spending. This is especially true with respect to defence
and security budgets, where certain countries have already
implemented substantial reductions. Any termination or reductionof future funding or cancellations or delays impacting existing
contracts may have a negative effect on the Company’s future
results of operation and ﬁnancial condition. In the case where

several countries undertake to enter together into defence orother procurement contracts, economic, political or budgetary
constraints in any one of these countries may have a negative
effect on the ability of the Company to enter into or perform suchcontracts.
Further, a significant portion of the Company’s backlog isconcentrated in certain regions or countries, including the US
and Asia. Adverse economic and political conditions as well as
downturns in broad economic trends in these countries or regions
may have a negative effect on the Company’s future results ofoperation and ﬁnancial condition.

Availability of Government and Other Sources of Financing
Since 1992, the EU and the US have operated under an agreementthat sets the terms and conditions of financial support thatgovernments may provide to civil aircraft manufacturers. In late2004, however, the US sought to unilaterally withdraw from thisagreement, which eventually led to the US and the EU making formal
claims against each other before the World Trade Organization(“WTO”). While both sides have expressed a preference for anegotiated settlement that provides for a level playing ﬁeld whenfunding future aircraft developments, they have thus far failed
to reach agreement on key issues. The terms and conditionsof any new agreement, or the ﬁnal outcome of the formal WTO
proceedings, may limit access by the Company to risk-sharingfunds for large projects, may establish an unfavourable balanceof access to government funds by the Company as compared
to its US competitors or may in an extreme scenario cause theEuropean Commission and the involved governments to analyse
possibilities for a change in the commercial terms of funds alreadyadvanced to the Company.

14

In prior years, the Company and its principal competitors haveeach received different types of government ﬁnancing of productresearch and development. However, no assurances can be giventhat government ﬁnancing will continue to be made available in
the future, in part as a result of the proceedings mentioned above.
Moreover, the availability of other outside sources of ﬁnancing
will depend on a variety of factors such as market conditions,the general availability of credit, the Company’s credit ratings, aswell as the possibility that lenders or investors could develop anegative perception of the Company’s long- or short-term ﬁnancial
prospects if it incurred large losses or if the level of its businessactivity decreased due to an economic downturn. The Company
may therefore not be able to successfully obtain additional outside
financing on favourable terms, or at all, which may limit theCompany’s future ability to make capital expenditures, fully carryout its research and development efforts and fund operations.

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Competition and Market Access
The markets in which the Company operates are highly competitive.
In some areas, competitors may have more extensive or more
specialised engineering, manufacturing and marketing capabilities
than the Company. In addition, some of the Company’s largest
customers may develop the capability to manufacture products orprovide services similar to those of the Company. This would resultin these customers supplying their own products or services andcompeting directly with the Company for sales of these products
or services, all of which could signiﬁcantly reduce the Company’s
revenues. There can be no assurance that the Company will be able
to compete successfully against its current or future competitors
or that the competitive pressures it faces in all business areas will
not result in reduced revenues or market share.

In addition, the contracts for many aerospace and defence products
are awarded, implicitly or explicitly, on the basis of home country
preference. Although the Company is a multinational company
which helps to broaden its domestic market, it may remain at acompetitive disadvantage in certain countries, especially outsideof Europe, relative to local contractors for certain products.
The strategic importance and political sensitivity attached tothe aerospace and defence industries means that politicalconsiderations will play a role in the choice of many products forthe foreseeable future.

Major Research and Development Programmes
The business environment in many of the Company’s principal
operating business segments is characterised by extensive
research and development costs requiring signiﬁcant up-front
investments with a high level of complexity. The business plans
underlying such investments often contemplate a long payback
period before these investments are recouped, and assume acertain level of return over the course of this period in order tojustify the initial investment. There can be no assurances that thecommercial, technical and market assumptions underlying suchbusiness plans will be met, and consequently, the payback periodor returns contemplated therein achieved.

Successful development of new programmes also depends on
the Company’s ability to attract and retain aerospace engineers
and other professionals with the technical skills and experience
required to meet its speciﬁc needs. Demand for such engineers
may often exceed supply depending on the market, resulting in
intense competition for qualiﬁed professionals. There can be noassurances that the Company will attract and retain the personnel
it requires to conduct its operations successfully. Failure to attract
and retain such personnel or an increase in the Company’s
employee turnover rate could negatively affect the Company’s
future results of operation and ﬁnancial condition.

Restructuring, Transformation and Cost Saving Programmes
In order to improve competitiveness, offset rising procurement
costs and achieve proﬁtability targets, among other things, theCompany and its Divisions have launched several restructuring,transformation and cost saving programmes over the past several
years. These include group-wide programmes, as well as Divisionor Corporate-speciﬁc programmes such as the Airbus Defence
and Space restructuring plan.
Anticipated cost savings under these programmes are based on
estimates, however, and actual savings under these programmes
may vary signiﬁcantly. In particular, the Company’s cost reduction
measures are based on current conditions and do not take into
account any future cost increases that could result from changes
in its industry or operations, including new business developments,
wage and cost increases or other factors. The Company’s failure
to successfully implement these planned cost reduction measures,or the possibility that these efforts may not generate the level ofcost savings it expects going forward, could negatively affect its
future results of operation and ﬁnancial condition.
In addition to the risk of not achieving the anticipated level of costsavings from these programmes, the Company may also incur
higher than expected implementation costs. In many instances,
there may be internal resistance to the various organisational
restructuring and cost reduction measures contemplated.
Restructuring, closures, site divestitures and job reductions may
also harm the Company’s labour relations and public relations, andhave led and could lead to work stoppages and/or demonstrations.
In the event that these work stoppages and/or demonstrations
become prolonged, or the costs of implementing the programmes
above are otherwise higher than anticipated, the Company’s future
results of operation and ﬁ nancial condition may be negatively
affected.

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Acquisitions, Joint Ventures & Strategic Alliances
As part of its business strategy, the Company may acquirebusinesses and form joint ventures or strategic alliances.
Acquisitions are inherently risky because of difﬁculties that may
arise when integrating people, operations, technologies andproducts. There can be no assurance that any of the businesses
that the Company acquires can be integrated successfully and astimely as originally planned or that they will perform well and deliver

the expected synergies once integrated. In addition, the Company
may incur signiﬁcant acquisition, administrative and other costs
in connection with these transactions, including costs related tointegration of acquired businesses. While the Company believes
that it has established appropriate and adequate procedures andprocesses to mitigate these risks, there is no assurance that thesetransactions will be successful.

Public-Private Partnerships and Private Finance Initiatives
Defence customers, particularly in the UK, increasingly request
proposals and grant contracts under schemes known as publicprivate partnerships (“PPPs”) or private ﬁnance initiatives (“PFIs”).
PPPs and PFIs differ substantially from traditional defence
equipment sales, as they often incorporate elements such as:
the provision of extensive operational services over the life of
the equipment;■
continued ownership and ﬁnancing of the equipment by a party
other than the customer, such as the equipment provider;■mandatory compliance with speciﬁc customer requirements
pertaining to public accounting or government procurement
regulations; and■provisions allowing for the service provider to seek additionalcustomers for unused capacity.
■

The Company is party to PPP and PFI contracts, for example
through Paradigm with Skynet 5 and related telecommunications
services, and in the AirTanker (FSTA) project. One of the complexities
presented by PFIs lies in the allocation of risks and the timing
thereof among different parties over the lifetime of the project.
There can be no assurances of the extent to which the Company
will efﬁciently and effectively (i) compete for future PFI or PPP
programmes, (ii) administer the services contemplated under
the contracts, (iii) ﬁnance the acquisition of the equipment andthe on-going provision of services related thereto, or (iv) accessthe markets for the commercialisation of excess capacity. The
Company may also encounter unexpected political, budgetary,
regulatory or competitive risks over the long duration of PPP and
PFI programmes.

Programme-Speciﬁc Risks
In addition to the risk factors mentioned above, the Company also
faces the following programme-speciﬁc risks (while this list does
not purport to be exhaustive, it highlights the current risks believed
to be material by management and could have a signiﬁcant impact
on the Group’s results and ﬁnancial condition):
A350 XWB programme. In connection with the A350 XWB
programme, after a successful certification campaign ofA350-900 XWB and a ﬁrst delivery to Qatar Airways, the Company
faces the following main challenges: ensuring satisfaction of ﬁrst
operators and high quality support to its operations; maintaining
supply chain performance and production ramp-up; managing
production overcosts of the early aircraft and recurring costs
beyond the initial ramp-up phase; maintaining customisationand head of versions ramp-up; and maintaining the development
schedule of A350-1000 XWB to ensure entry in service asplanned.
A380 programme. In connection with the A380 programme, theCompany faces the following main challenges: secure order ﬂow
in order to maintain current rate of production in the long term;
making continued improvements to lower the resources and costs

16

associated with designing each customised “head of version”
aircraft for new customers, in order to allow a higher numberof head of version to be completed each year; and managing
maturity in service.
A400M programme. In connection with the A400M programme,
the Company faces the following main challenges: finalising
the development, tests and associated documentation to
enable progressively enhanced aircraft capabilities throughstandard operational clearance (SOC1 to 3); completing theﬁnal development of a full set of in-service support goods andservices as well as providing high levels of service for integrated
logistic support that deliver mission success to customers;
pursuing further aircraft development (paratrooper systems, cargo
and aerial delivery systems, defensive and protection militarysystems, air to air refueling); continuing production ramp-up;
managing the contractual retroﬁt campaign; increasing export
orders; and meeting the contractual time schedule for the next
programme milestones. For further information, see “— Notes to
the Consolidated Financial Statements (IFRS) — Note 6: Revenues
and Gross Margin”.

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A320neo programme. In connection with the A320neo programme,
the Company faces the following main challenges: managementof stress in the supply chain as a result of the industrial ramp-up;
meeting the engine development status including performancetargets, and its schedule; and ensuring the availability of skilled
personnel for the programme. The programme progresses asplanned and no new challenges emerged in 2014. The main focus
will be the transition from 2015 to 2018 from A320ceo (current
engine option) to A320neo (new engine option) as well as further
ramp-up.
A330 programme. In connection with the long range programme,
managing the order book beyond 2016 becomes more challenging
due to competition from A350 XWB and Boeing 787. The Company
has launched the A330neo with an aggressive development
schedule based on A320neo experience.
NH90 and Tiger programmes. In connection with the NH90 and
Tiger programmes, the Company faces the challenge of ﬁnalising
the contract renegotiations with governments addressing requests
to reduce contractually binding orders; and assuring support
readiness in connection with multiple ﬂeets entering into service.
EC175 programme. In connection with the EC175 programme
produced in cooperation with Avic, the Company faces thefollowing main challenges: after the certiﬁcation by EASA andthe delivery of the 3 ﬁrst EC175 for Oil and Gas operations, theCompany is proceeding with the industrial ramp-up, mastering
the maturity plan of the aircraft and further certiﬁcations plannedfor 2015.
Lead systems integration. In connection with lead systems
integration projects (in particular the Kingdom of Saudi Arabia
border surveillance contract and Qatar National Security Shield),the Company faces the following main challenges: meeting theschedule and cost objectives taking into account the high numberof sites, the complex local infrastructure to be delivered and theintegration of COTS products (radars, cameras, sensors) interfaced
into a complex system network; assuring an efﬁcient project andstafﬁng ramp-up; managing the rollout including subcontractors,
training and customer organisational adaptation; repetitivechanges in customer project organisation; lack of decision anddelays in the procurement of Customer Furnished Items. In relation
to a Command and Control System for the UAE, which was underdevelopment by Emiraje Systems LLC (in which the Company has
a 49% shareholding), the customer has indicated its willingness
to terminate the contract amicably. Settlement negotiations areunderway and activities terminated.

3. Legal Risks
Dependence on Joint Ventures and Minority Holdings
The Company generates a substantial proportion of its revenues
through various consortia, joint ventures and equity holdings.
These arrangements include primarily:
the Euroﬁghter and AirTanker consortia;
three principal joint ventures: MBDA, ATR and Atlas Electronik;
and■investment in associates: Dassault Aviation.
■■

The formation of partnerships and alliances with other market
players is an integral strategy of the Company, and the proportion ofsales generated from consortia, joint ventures and equity holdings
may rise in future years. This strategy may from time to time leadto changes in the organisational structure, or realignment in thecontrol, of the Company’s existing joint ventures.
The Company exercises varying and evolving degrees of control
in the consortia, joint ventures and equity holdings in which it

participates. While the Company seeks to participate onlyin ventures in which its interests are aligned with those of its
partners, the risk of disagreement or deadlock is inherent in ajointly controlled entity, particularly in those entities that require theunanimous consent of all members with regard to major decisions
and specify limited exit rights. The other parties in these entities
may also be competitors of the Company, and thus may haveinterests that differ from those of the Company.
In addition, in those holdings in which the Company is a minority
partner or shareholder, the Company’s access to the entity’s books
and records, and as a consequence, the Company’s knowledge ofthe entity’s operations and results, is generally limited as compared
to entities in which the Company is a majority holder or is involvedin the day-to-day management.

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Product Liability and Warranty Claims
The Company designs, develops and produces a number of highproﬁ le products of large individual value, particularly civil andmilitary aircraft and space equipment. The Company is subject
to the risk of product liability and warranty claims in the event thatany of its products fails to perform as designed. While the Company
believes that its insurance programmes are adequate to protect itfrom such liabilities, no assurances can be given that claims will notarise in the future or that such insurance coverage will be adequate.

Intellectual Property
The Company relies upon patent, copyright, trademark and trade
secret laws, and agreements with its employees, customers,
suppliers and other parties, to establish and maintain its intellectual
property rights in technology and products used in its operations.
Despite these efforts to protect its intellectual property rights, anyof the Company’s direct or indirect intellectual property rights could
be challenged, invalidated or circumvented. Further, the laws ofcertain countries do not protect the Company’s proprietary rights
to the same extent as the laws in Europe and the US. Therefore,
in certain jurisdictions the Company may be unable to protect its
proprietary technology adequately against unauthorised thirdparty copying or use, which could adversely affect its competitive
position.

In addition, although the Company believes that it lawfully complies
with the intellectual property rights granted to others, it has beenaccused of infringement on occasion and could have additional
claims asserted against it in the future. These claims could harm
its reputation, cost it money and prevent it from offering certain
products or services. Any claims or litigation in this area, whether
the Company ultimately wins or loses, could be time-consuming
and costly, injure the Company’s reputation or require it to enter
into licensing arrangements. The Company might not be able toenter into these licensing arrangements on acceptable terms. If
a claim of infringement were successful against it, an injunction
might be ordered against the Company, causing further damages.

Export Controls and Other Laws and Regulations
The export market is a signiﬁcant market for the Company. In
addition, many of the products the Company designs andmanufactures for military use are considered to be of national
strategic interest. Consequently, the export of such products
outside of the jurisdictions in which they are produced may be
restricted or subject to licensing and export controls, notably by
the UK, France, Germany and Spain, where the Company carries
out its principal military activities as well as by other countries
where suppliers come from, notably, the US. There can be noassurance (i) that the export controls to which the Company issubject will not become more restrictive, (ii) that new generationsof the Company’s products will not also be subject to similar or
more stringent controls or (iii) that geopolitical factors or changing
international circumstances will not make it impossible to obtain
export licenses for one or more clients or constrain the Company’s
ability to perform under previously signed contracts. Reduced
access to military export markets may have a signiﬁcant adverse
effect on the Company’s business, results of operation andﬁnancial condition.
Operating worldwide, the Company must comply with several setsof sanctions laws and regulations implemented by national/regional
authorities and in particular by the EU and the US. Depending on
geopolitical considerations including national security interestsand foreign policy, new sanctions programs may be set up or the18

scope of existing ones may be widened, immediately impacting
the Company’s activities. The Company is also subject to avariety of other laws and regulations, including among others,
those relating to commercial relationships, the use of its products
and anti-bribery provisions. In addition, the Company’s ability tomarket new products and enter new markets may be dependent
on obtaining government certiﬁcations and approvals in a timely
manner. Although the Company seeks to comply with all such laws
and regulations, even unintentional violations or a failure to comply
could result in administrative, civil or criminal liabilities including
signiﬁcant ﬁnes and penalties, suspension or debarment of theCompany from government contracts for some period of time orsuspension of the Company’s export privileges, or preclude theCompany from bidding on certain government contracts (even in
the absence of a formal suspension or debarment).
In addition, the Company is sometimes subject to government
inquiries and investigations of its business and competitiveenvironment due, among other things, to the heavily regulated
nature of its industry. In addition to the risk of an unfavourable
ruling against the Company, any such inquiry or investigation could
negatively affect the Company’s reputation and its ability to attract
and retain customers, which could have a negative effect on its
business, results of operation and ﬁnancial condition.

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Risk Factors
4 Industrial and Environmental Risks

Legal and Regulatory Proceedings
The Company is currently engaged in a number of active legal
and regulatory proceedings. See “— Information on the Group’s
Activities — 1.1.8 Legal and Arbitration Proceedings”. The Company
expects to continue to incur time and expenses associated with its
defence, regardless of the outcome, and this may divert the efforts
and attention of management from normal business operations.

Although the Company is unable to predict the outcome of theseproceedings, it is possible that they will result in the imposition ofdamages, ﬁnes or other remedies, which could have a negative
effect on the Company’s business, results of operation andﬁnancial condition. An unfavourable ruling could also negatively
impact the Company’s stock price and reputation.

4. Industrial and Environmental Risks
Given the scope of its activities and the industries in which it
operates, the Company is subject to stringent environmental,
health and safety laws and regulations in numerous jurisdictions
around the world. The Company therefore incurs, and expects tocontinue to incur, signiﬁcant capital expenditure and other operating
costs to comply with increasingly complex laws and regulations
covering the protection of the natural environment as well as
occupational health and safety, including costs to prevent, control,
eliminate or reduce emissions into the environment, releases of
air pollutants into the atmosphere, discharges to surface andsubsurface water and soil, usage of certain substances and thecontent of the Company’s products, the disposal and treatmentof waste materials, and costs to comply with reporting or warning
regulations. Moreover, new laws and regulations, the impositionof tougher licence requirements, increasingly strict enforcement
or new interpretations of existing laws and regulations may cause
the Company to incur increased capital expenditure and operating
costs in the future in relation to the above, which could have anegative effect on its results of operation and ﬁnancial condition.
If the Company fails to comply with these environmental, health andsafety laws and regulations, even if caused by factors beyond its
control, that failure may result in the assessment of civil or criminal
penalties and ﬁnes against it. Regulatory authorities may require
the Company to conduct investigations and undertake remedialactivities, curtail operations or close installations or facilities
temporarily to prevent imminent risks. In the event of an industrial
accident or other serious incident, employees, customers and otherthird parties may ﬁle claims for personal injury, property damage ordamage to the environment (including natural resources). Further,

liability under some environmental laws relating to contaminatedsites can be imposed retroactively, on a joint and several basis,
and without any ﬁnding of non-compliance or fault. These potential
liabilities may not always be covered by insurance, or may be only
partially covered. The obligation to compensate for such damages
could have a negative effect on the Company’s results of operationand ﬁnancial condition.
In addition, the various products manufactured and sold by theCompany must comply with relevant environmental, health andsafety and substances / preparations related laws and regulationsin the jurisdictions in which they operate. Although the Company
seeks to ensure that its products meet the highest quality standards,
increasingly stringent and complex laws and regulations, newscientific discoveries, delivery of defective products or the
obligation to notify or provide regulatory authorities or others withrequired information (such as under the EU regulation known as“REACH”, which addresses the production and use of chemical
substances) may force the Company to adapt, redesign, redevelop,
recertify and/or eliminate its products from the market. Seizuresof defective products may be pronounced, and the Company
may incur administrative, civil or criminal liability. In the event ofan accident or other serious incident involving a product, theCompany may be required to conduct investigations and undertake
remedial activities. Employees, customers and other third parties
may also ﬁle claims for personal injury, property damage or damage
to the environment (including natural resources). Any problems
in this respect may also have a signiﬁcant adverse effect on the
reputation of the Company and its products and services.

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Information on the Group’s
Activities
1.1 Presentation of the Group

22

1.1.1 Overview

22

1.1.2 Airbus

25

1.1.3 Airbus Helicopters

31

1.1.4 Airbus Defence and Space34

1.1.5 Other Businesses

41

1.1.6 Investments

43

1.1.7 Insurance

44

1.1.8 Legal and Arbitration Proceedings

45

1.1.9 Research and Technology, Intellectual Property

47

1.1.10 Environmental Protection

48

1.1.11 Employees

51

1.1.12 Incorporation by Reference

52

1.2 Recent Developments

53

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Information on the Group’s Activities
1.1 Presentation of the Group

1.1 Presentation of the Group
1.1.1

Overview

Due to the nature of the markets in which the Company operates andthe conﬁdential nature of its businesses, any statements with respect to
the Company’s competitive position set out in paragraphs 1.1.1 through 1.1.6
below have been based on the Company’s internal information sources,
unless another source has been speciﬁed below.
With consolidated revenues of € 60.7 billion in 2014, the Group isEurope’s premier aerospace and defence company and one of thelargest aerospace and defence companies in the world. In termsof market share, the Group is among the top two manufacturersof commercial aircraft, civil helicopters, commercial space launchvehicles and missiles, and a leading supplier of military aircraft,satellites and defence electronics. In 2014, it generated 82% of its
total revenues in the civil sector (compared to 81% (adjusted) in2013) and 18% in the defence sector (compared to 19% (adjusted)in 2013). As of 31 December 2014, the Group’s active headcountwas 138,622 employees.

3. pursue incremental innovation potential within productprogrammes while preparing next-generation breakthroughsand developing necessary skills and competencies required
to compete in the future;

Strategy

7. strengthen the value chain position.

The new Strategy 2.0 is not a revolution, but rather a natural
evolution from Vision 2020. Airbus Group aims for leadership ofthe commercial aeronautics, military aircraft and space markets.
To do this, the Group is driving innovation, globalisation, services
and value-chain optimisation, all of which will result in improved
proﬁtability and performance.
Internally, the Group needs to consolidate and adapt the way itworks. Due to the current institutional budget downturn in our homemarkets, it is imperative to secure the proﬁtability and competitive
position of our defence and space business by improving thecost base and gaining access beyond home markets. Hence,the pooling of the Group’s scattered defence activities in Airbus
Defence and Space and streamlining the portfolio have beennecessary steps, as well as the transformation programme
launched in Airbus Helicopters.
Furthermore, to optimise the market recognition and value, and tocontinue the integration of the Group, the rebranding and renaming
under a common Airbus brand for all key businesses have been
important steps forward.
The 7 strategic paths of the Airbus Group Strategy are as follows:
1. strengthen market position and profitability while remaining aleader in commercial aeronautics;
2. preserve leading position in European defence, space andgovernment markets by focusing on military aircraft, missiles,
space and related services;22

4. focus on profitability, value creation and market position; noneed to chase growth at any cost. Actively manage portfolio;
5. adapt to a more global world as well as attract and retain global
talents;
6. focus services on and around the Group’s platforms;

Organisation of the Group’s Businesses
Airbus Group organises its businesses into the following threeoperating Divisions: (i) Airbus, (ii) Airbus Defence and Space and(iii) Airbus Helicopters. The chart set out in “General Descriptionof the Company and its Share Capital — 3.3.6 Simpliﬁed Group
Structure Chart” illustrates the allocation of activities among thesethree Divisions.

AirbusAirbus is one of the world’s leading aircraft manufacturers, offering
the most modern and efﬁcient passenger aircraft on the more than
100-seat market. The Airbus commercial product line comprises
aircraft that range in size from the 107-seat single-aisle A318 aircraft
to the 525-seat A380 widebody aircraft.
Since it was founded in 1970 and up to the end of 2014, Airbus hasreceived orders for 15,271 commercial aircraft from 376 customers
around the world. In 2014, Airbus delivered 629 aircraft (comparedto 626 deliveries in 2013) and received 1,796 gross orders(compared to 1,619 gross orders in 2013), or 48% of the grossworldwide market share (in value terms) of aircraft with morethan 100 seats. After accounting for cancellations, net orderintake for 2014 was 1,456 aircraft (compared to 1,503 aircraft in2013). As of 31 December 2014, Airbus’ backlog of commercial
orders was 6,386 aircraft (compared to 5,559 aircraft in 2013).
See “— 1.1.2 Airbus”.

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1.1 Presentation of the GroupIn 2014, Airbus recorded total revenues of € 42.2 billion –representing 69.6% of the Group’s revenues.

Airbus Helicopters
Airbus Helicopters (formerly Eurocopter) is a global leader inthe civil and military rotorcraft market, offering one of the mostcomplete and modern ranges of helicopters and related services.
This product range currently includes light single-engine, lighttwin-engine, medium and medium-heavy rotorcraft, which areadaptable to all kinds of mission types based on customer needs.
Airbus Helicopters delivered 471 helicopters in 2014 (497 in 2013)
and received 426 gross orders in 2014 (compared to 444 grossorders in 2013). Order Intake amounted to € 5.5 billion (2013:€ 5.7 billion) including 402 net orders of Commercial Helicopters
before backlog adjustment of -33 NH90. Civil contracts accounted
for 52% of this order volume, with military sales representing theremaining 48%. At the end of 2014, Airbus Helicopters order bookstood at 893 helicopters (2013: 995 helicopters). In 2014, Airbus
Helicopters recorded total revenues of € 6.5 billion, representing
10.7% of the Group’s revenues. See “— 1.1.3 Airbus Helicopters”.

Airbus Defence and Space
In 2014, the defence and space businesses of Airbus Military,
Astrium and Cassidian have been combined into one new Division,
Airbus Defence and Space. The new Division started operating at
executive level on 1 January 2014, the fully integrated organisation
was launched on 1 July 2014. The combination creates synergies
in the Company’s operations and product portfolio and a betterfocus on the research and development efforts. The new Division
is Europe’s number one defence and space enterprise, the second
largest space business worldwide and among the top ten global

defence enterprises. Airbus Defence and Space puts a strong
focus on core businesses: Space, Military Aircraft, Missiles andrelated systems and services.
Airbus Defence and Space is composed of four Business Lines:
Military Aircraft; Space Systems; Communications, Intelligence &Security (CIS); and Electronics. It brings together a wide portfolio
to continue to meet the complex needs of its customers across theworld, contribute to their defence and security, and enable theirutilisation of space. In addition it secures Europe’s independent
access to space. Among its ﬂagship products are the transport
aircraft A400M, the military jet Euroﬁghter and, in the frameworkof the Airbus Safran Launchers joint venture, the Ariane launcher.
In 2014, Airbus Defence and Space recorded total revenues of€ 13.0 billion, representing 21.4% of the Group’s revenues. See“— 1.1.4 Airbus Defence and Space”.

Other Businesses
Other Businesses (not part of the Group’s three Divisions) include
turboprop manufacturer ATR, aerostructure and aircraft seatbusiness Sogerma, which merged with Aerolia at the end of 2014
to become STELIA Group, US operating unit Airbus Group Inc.
and Daher-Socata (remaining 30% stake sold in June 2014). In
2014, the recorded total revenues of Other Businesses amounted
to € 428 million. See “— 1.1.5 Other Businesses”.

Investments
Among its signiﬁ cant investments, as of 31 December 2014,
the Company held a 42.11% stake in Dassault Aviation, a major
participant in the world market for military jet aircraft and businessjets. See “— 1.1.6 Investments”.

Summary Financial and Operating Data
The following tables provide summary ﬁnancial and operating data for the Group for the past three years.
CONSOLIDATED REVENUES BY DIVISION FOR THE YEARS ENDED 31 DECEMBER 2014, 2013 AND 2012(in €m)Year ended
31 December 2014

Year ended
31 December 2013(1)Year ended
31 December 2012(2)Airbus42,28039,49437,624

Airbus Helicopters

6,524

6,297

6,264

Airbus Defence and Space

13,025

13,121

13,52061,82958,912

57,408(1,116)(1,345)(928)

60,71357,56756,480Total Divisional revenues

Other – HQ / Consolidation

Total

(3)

(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.
(3) “Other — HQ / Consolidation” comprises adjustments and eliminations for intercompany transactions, the Group’s activities managed in the US and the holding function of the Group’s
Headquarters such as the newly acquired bank and other activities not allocable to the reportable segments.

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1.1 Presentation of the GroupCONSOLIDATED REVENUES BY GEOGRAPHICAL AREA FOR THE YEARS ENDED 31 DECEMBER 2014, 2013 AND 2012

Year ended 31 December 2014

EuropeYear ended 31 December 2013(1)Year ended 31 December 2012(2)Amount in €bn

In percentage(3)Amount in €bn

In percentage(3)Amount in €bn

In percentage(3)

20.3

33.4%

20.3

35.3%

21.0

37.2%

North America

9.7

16.0%

8.7

15.1%

7.7

13.6%

Asia / Pacific

19.4

31.9%

19.3

33.4%

18.3

32.5%

Rest of the World(4)

11.3

18.7%

9.3

16.2%

9.5

16.7%

Total

60.7

100%

57.6

100%

56.5

100%

(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11.
(3) Percentage of total revenues after eliminations.
(4) Including the Middle East.

CONSOLIDATED ORDERS BOOKED FOR THE YEARS ENDED 31 DECEMBER 2014, 2013 AND 2012

Year ended 31 December 2014

Year ended 31 December 2013(1)Year ended 31 December 2012(2)Amount in €bn

In percentage(3)Amount in €bn

In percentage(3)Amount in €bn

In percentage(3)

150.1

89.4%

199.2

91.9%

87.3

84.6%

5.5

3.3%

5.8

2.7%

5.4

5.2%

Orders booked(4)Airbus(5)Airbus Helicopters
Airbus Defence
and Space

12.2

7.3%

11.8

5.4%

10.5

10.2%

Total Divisional orders

167.8

100%

216.8

100%

103.2

100%

Other – HQ /Consolidation

(1.4)

(0.4)

(0.7)

166.4

216.4

102.5

Total

(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.
(3) Before “Other — HQ / Consolidation”.
(4) Without options.
(5) Based on catalogue prices for commercial aircraft activities.

CONSOLIDATED BACKLOG FOR THE YEARS ENDED 31 DECEMBER 2014, 2013 AND 2012(1)Year ended 31 December 2014

Airbus(5)

Airbus Helicopters

Year ended 31 December 2013(2)Year ended 31 December 2012(3)Amount in €bn

In percentage(4)Amount in €bn

In percentage(4)Amount in €bn

In percentage(4)

803.6

93.6%

625.6

91.8%

505.3

89.0%

12.2

1.4%

12.4

1.8%

13.0

2.3%

Airbus Defence
and Space

43.1

5.0%

43.2

6.4%

49.2

8.7%

Total Divisional backlog

858.9

100%

681.2

100%

567.5

100%

Other – HQ /Consolidation

Total

(1.4)

(0.6)

(1.0)

857.5

680.6

566.5

(1) Without options.
(2) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(3) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.
(4) Before “Other — HQ / Consolidation”.
(5) Based on catalogue prices for commercial aircraft activities.

24

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1.1 Presentation of the Group

Relationship between Airbus Group N.V. and the Group
Airbus Group N.V. itself does not engage in the core aerospace,defence or space business of its Group but coordinates related
businesses, sets and controls objectives and approves majordecisions for its Group. As the parent company, Airbus Group N.V.
conducts activities which are essential to the Group activities andwhich are an integral part of the overall management of the Group.
In particular, ﬁnance activities pursued by Airbus Group N.V. arein support of the business activities and strategy of the Group.
In connection therewith, Airbus Group N.V. provides or procuresthe provision of services to the subsidiaries of the Group. General

1.1.2

management service agreements have been put in place with thesubsidiaries and services are invoiced on a cost plus basis.
For management purposes, Airbus Group N.V. acts through its
Board of Directors, Executive Committee, and Chief Executive
Ofﬁcer in accordance with its corporate rules and procedures as
described below under “Corporate Governance”.
Within the framework deﬁned by Airbus Group N.V., each Division,
Business Unit and subsidiary is vested with full entrepreneurial
responsibility.

AirbusIntroduction and Overview
Airbus is one of the world’s leading aircraft manufacturers, offering
the most modern and efﬁcient passenger aircraft family on the
more than 100-seat market. Airbus’ comprehensive product line
comprises highly successful families of aircraft ranging from 100
to more than 500 seats.
Since it was founded in 1970 and up to the end of 2014, Airbus hasreceived orders for 15,271 commercial aircraft from 376 customers
around the world. In 2014, Airbus delivered 629 aircraft (comparedto 626 deliveries in 2013) and received 1,796 gross orders(compared to 1,619 gross orders in 2013), or 48% of the grossworldwide market share (in value terms) of aircraft with more than
100 seats. After accounting for cancellations, net order intake for2014 was 1,456 aircraft (compared to 1,503 aircraft in 2013). As
of 31 December 2014, Airbus’ backlog of commercial orders was
6,386 aircraft (compared to 5,559 aircraft in 2013).

newest evolution to the A330 family and the A320neo (new engine
option) is one of many product upgrades to the A320 single-aisle
aircraft family to maintain its position as the most advanced andfuel-efﬁcient single-aisle aircraft family.
Airbus is also currently pursuing (i) development and production on
the A350 XWB programme, (ii) the gradual expansion of relevant
freighter applications with the A330-200F, and (iii) research on thedevelopment of new aircraft in the short-range, medium-range
and long-haul segments.

Expanding its Customer Services Offering

In 2014, Airbus recorded total revenues of € 42.2 billion
representing 69.6% of the Group’s revenues.

Airbus seeks to remain at the forefront of the industry by expanding
its customer services offering to meet customers’ evolving needs.
As a result, Airbus has developed a wide range of value-added andcustomised services which customers can select based on theirown outsourcing policy and needs. This approach provides Airbus
operators with solutions to signiﬁcantly reduce their operating
costs, increase aircraft availability and enhance the quality of theiroperations.

StrategyMarketAirbus’ primary goal is to deliver strong results in a sustainedmanner, while commanding a further increased share of theworldwide commercial aircraft market over the long-term andexpanding its customer services offering. To achieve these goals,
Airbus is actively:

Cyclicality and Market Drivers

Building a Leaner, More Fully Integrated Company
In order to build a leaner, more fully integrated company and thereby
bolster its competitiveness, Airbus is adapting its organisation tofoster an entrepreneurial spirit and empower more teams, while
maintaining harmonised processes across all sites. For series
programmes, additional responsibilities and means have beendelegated to plants for delivery at increased rates.

Developing the Most Comprehensive Line of Products
in Response to Customer Needs
Airbus continuously seeks to develop and deliver new products tomeet customers’ evolving needs, while also improving its existingproduct line. For example, the A330neo (new engine option) is the

The main factors affecting the commercial aircraft market include
passenger demand for air travel, cargo activity, economic growth
cycles, national and international regulation (and deregulation),
the rate of replacement and obsolescence of existing ﬂeets andthe availability of aircraft ﬁnancing sources. The performance,competitive posture and strategy of aircraft manufacturers,
airlines, cargo operators and leasing companies as well as wars,
political unrest, pandemics and extraordinary events may alsoprecipitate changes in demand and lead to short-term market
imbalances.
In recent years, China and India have emerged as signiﬁcant new
aircraft markets. According to internal estimates, they are expected
to constitute the ﬁrst and fourth most important markets by aircraft
delivery value, respectively, in the next twenty years. As a result,
Airbus has sought to strengthen its commercial and industrial ties
in these countries. New aircraft demand from airlines in the Middle
East has also become increasingly important, as they have rapidly

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1.1 Presentation of the Group

executed strategies to establish a global presence and to leverage
the beneﬁts the region can deliver.
The no-frills / low-cost carriers also constitute a signiﬁcant sector,
and are expected to continue growing around the world, particularly
in Asia, where emerging markets and continued deregulation
should provide increased opportunities. While Airbus singleaisle aircraft continue to be a popular choice for these carriers,
demand for Airbus’ range of twin-aisle aircraft may also increase
as some of these carriers develop or further develop their longrange operations.
Overall growth. The long-term market for passenger aircraft
depends primarily on passenger demand for air travel, which isitself primarily driven by economic or GDP growth, fare levels anddemographic growth. Measured in revenue passenger kilometres,
air travel increased in every year from 1967 to 2000, except for1991 due to the Gulf War, resulting in an average annual growthrate of 7.9% for the period. Demand for air transportation also
proved resilient in the years following 2001, when successive
shocks, including 9/11 and SARS in Asia, dampened demand.
Nevertheless, the market quickly recovered.
More recently, the ﬁnancial crisis and global economic difﬁculties
witnessed at the end of 2008 and into 2009 resulted in only thethird period of negative trafﬁc growth during the jet age, and acyclical downturn for airlines in terms of trafﬁc (both passenger
and cargo), yields and proﬁtability. Preliminary ﬁgures released at
the end of 2014, by the International Civil Aviation Organisation(ICAO), conﬁrmed that some 3.2 billion passengers made use of
the global air transport network for their business and tourism
needs in 2014. The annual passenger total is up approximately
5% compared to 2013.
In the long term, Airbus believes that air travel remains a growthbusiness. Based on internal estimates, Airbus anticipates a growthrate of 4.7% annually during the period 2013-2033. If the actual
growth rate equals or exceeds this level, Airbus expects thatpassenger trafﬁc, as measured in revenue passenger kilometres,
would more than double in the next ﬁfteen years.
Cyclicality. Despite an overall growth trend in air travel, aircraft
order intake can vary signiﬁcantly from year to year, due to thevolatility of airline proﬁtability, cyclicality of the world economy,
aircraft replacement waves and occasional unforeseen events
which can depress demand for air travel. However, new productofferings and growth across the market has resulted in good levelsof order activity in recent years. In the last four years, order totals
comfortably exceeded record Airbus deliveries thus strengthening
both order book and backlog totals.
Despite some cyclicality in air trafﬁc, Airbus aims to secure stabledelivery rates from year to year, supported by a strong backlog oforders and a regionally diverse customer base. At the end of 2014,
Airbus’ commercial backlog stood at 6,386 aircraft, representing
more than ten years of production at current rates. Throughcareful backlog management, close monitoring of the customer
base and a prudent approach to production increases, Airbus
has successfully increased annual deliveries for 13 years running,
even through the economic crisis of 2008-2009.

26

Regulation / Deregulation. National and international regulation(and deregulation) of international air services and major domestic
air travel markets affect demand for passenger aircraft as well. In
1978, the US deregulated its domestic air transportation system,
followed by Europe in 1985. The more recently negotiated “Open
Skies Agreement” between the US and Europe, which became
effective in 2008, allows any European or US airline to ﬂy any route
between any city in the EU and any city in the US. Other regions
and countries are also progressively deregulating, particularly in
Asia. This trend is expected to continue, facilitating and in somecases driving demand. In addition to providing greater market
access (which may have formerly been limited), deregulation may
allow for the creation and growth of new airlines or new airline
models, as has been the case with the no-frills / low-cost airline
model, which has increased in importance throughout majordomestic and intra-regional markets since deregulation (e.g., in
the US and Europe).
Airline network development: “hub” and “point-to-point”
networks. Following deregulation, major airlines have sought
to tailor their route networks and ﬂeets to continuing changes
in customer demand. Accordingly, where origin and destination
demand prove sufﬁciently strong, airlines often employ direct, or“point-to-point” route services. However, where demand between
two destinations proves insufﬁcient, airlines have developed highly
efﬁcient “hub and spoke” systems, which provide passengers withaccess to a far greater number of air travel destinations throughone or more ﬂight connections.
The chosen system of route networks in turn affects aircraft
demand, as hubs permit ﬂeet standardisation around both smaller
aircraft types for the short, high frequency and lower density routes
that feed the hubs (between hubs and spokes) and larger aircraft
types for the longer and higher density routes between hubs (hubto-hub), themselves large point-to-point markets. As deregulation
has led airlines to diversify their route network strategies, it has at
the same time therefore encouraged the development of a wider
range of aircraft in order to implement such strategies (although
the trend has been towards larger-sized aircraft within each market
segment as discussed below).
Airbus, like others in the industry, believes that route networks willcontinue to grow through expansion of capacity on existing routes
and through the introduction of new routes, which will largely be
typiﬁed by having a major hub city at least at one end of the route.
These new route markets are expected to be well served by Airbus’
latest product offering, the A350 XWB. In addition, the A380 has
been designed primarily to meet the signiﬁcant demand between
the major hub cities, which are often among the world’s largest
urban centres (such as London, Paris, New York and Beijing).
Airbus has identiﬁ ed 42 major hub cities in its current market
analysis, with this number expected to grow to over 90 by 2033.
Airbus believes that it is well positioned to meet current and future
market requirements given its complete family of products.
Alliances. The development of world airline alliances has reinforced
the pattern of airline network development described above.
According to data from Ascend, a UK-based aviation industry
consultancy, just over one-third of the world’s jetliner seats being

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1.1 Presentation of the Groupﬂown today are operated by just 14 airlines as of January 2015. In
the 1990s, the major airlines began to enter into alliances that gave
each alliance member access to the other alliance members’ hubs
and routings, allowing airlines to concentrate their hub investments
while extending their product offering and market access.

Market Structure and Competition
Market segments. According to a study conducted by Airbus, a
total of 16,800 passenger aircraft with more than 100 seats were inservice with airlines worldwide at the beginning of 2014. Currently,
Airbus competes in each of the three principal market segments
for aircraft with more than 100 seats.
“Single-aisle” aircraft, such as the A320 family, have 100-210 seats,
typically conﬁgured with two triple seats per row divided by one
aisle, and are used principally for short-range and medium-range
routes.
“Twin-aisle” or “wide-body” aircraft, such as the A330 / A350 XWB
families, have a wider fuselage with more than 210 seats, typicallyconﬁgured with eight seats per row and with two aisles. The A330 /A350 XWB families are capable of serving all short- to long-range
markets.
“Very large aircraft”, such as the A380 family, are designed to carry
more than 400 passengers, non-stop, over very long-range routes
with superior comfort standards and with signiﬁcant cost-per-seatbeneﬁts to airlines, although such aircraft can also be used overshorter ranges in high-density (including domestic) markets.
Freight aircraft, which form a fourth, related segment, are often
converted ex-passenger aircraft. See “— 1.1.6 Investments— Aerostructures, Aircraft Conversion and Floor Panels — EFW”.
Airbus also competes in the corporate, VIP business jet market
with the ACJ, an A319-based Corporate Jetliner, and the A318
Elite. As well as these, other members of the Airbus family canserve the business jet market in private, corporate shuttle and ingovernment / VIP roles.
Geographic differences. The high proportion of single-aisle
aircraft in use in both North America and Europe reﬂ ects the
predominance of domestic short-range and medium-range ﬂights,
particularly in North America due to the development of hubs
following deregulation. In comparison with North America andEurope, the Asia-Paciﬁc region uses a greater proportion of twinaisle aircraft, as populations tend to be more concentrated in fewer
large urban centres. The tendency towards use of twin-aisle aircraftis also reinforced by the fact that many of the region’s major airports
limit the number of ﬂights, due either to environmental concerns or
to infrastructure constraints that limit the ability to increase ﬂight
frequency. These constraints necessitate higher average aircraft
seating capacity per ﬂight. However, Airbus believes that demand
for single-aisle aircraft in Asia will grow over the next 20 years,
particularly as domestic markets in China and India and low-costcarriers continue to develop in the region. Aircraft economics will
also help to drive aircraft size, with airlines looking to reduce thecost per seat through higher density aircraft cabins and the useof larger aircraft types and variants where possible.

Competition. Airbus has been operating in a duopoly since
Lockheed’s withdrawal from the market in 1986 and Boeing’s
acquisition of McDonnell Douglas in 1997. As a result, themarket for passenger aircraft of more than 100 seats is now
effectively divided between Airbus and Boeing. According to the
manufacturers’ published ﬁgures for 2014, Airbus and Boeing,respectively, accounted for 47% and 53% of total commercial
aircraft deliveries, 50% and 50% of total net orders (in units), and
52% and 48% of the total year-end backlog (in units), an industry
record. Airbus commercial aircraft deliveries (629 in 2014) werethe 13th year in a row of increased production at Airbus.
Nevertheless, the high technology and high value nature of thebusiness makes aircraft manufacturing an attractive industry inwhich to participate, and besides Boeing, Airbus faces aggressiveinternational competitors who are intent on increasing their market
share. Regional jet makers Embraer and Bombardier, comingfrom the less than 100-seat commercial aircraft market, continue
to develop larger airplanes (such as the new 100- to 149-seat
C-Series launched by Bombardier). Additionally, other competitorsfrom Russia, China and Japan will enter the 70- to 150-seat aircraft
market over the next few years.

Customers
As of 31 December 2014, Airbus had 376 customers and a totalof 15,271 Airbus aircraft had been ordered, of which 8,885 aircraft
had been delivered to operators worldwide. The table below shows
Airbus’ largest commitments in terms of total gross ﬁrm orders bycustomer for the year 2014.
Customer

Firm orders(1)SMBC Aviation Capital

115

CALC

100

American Airlines

78

Hong Kong Aviation Capital

70

Vietjet Air

63

Air Lease Corporation

60

Air Asia X

55(1) Options are not included in orders booked or year-end backlog.

Products and Services
The Family Concept — Commonality across the Fleet
Airbus’ aircraft families promote ﬂeet commonality. This philosophy
takes a central aircraft and tailors it to create derivatives to meetthe needs of speciﬁc market segments, meaning that all newgeneration Airbus aircraft share the same cockpit design, ﬂy-by-wire
controls and handling characteristics. Pilots can transfer among
any aircraft within the Airbus family with minimal additional training.
Cross-crew qualiﬁcation across families of aircraft provides airlines
with signiﬁcant operational ﬂexibility. In addition, the emphasis on
ﬂeet commonality permits aircraft operators to realise signiﬁcant
cost savings in crew training, spare parts, maintenance and aircraftscheduling. The extent of cockpit commonality within and acrossfamilies of aircraft is a unique feature of Airbus that, in management’s
opinion, constitutes a sustainable competitive advantage.

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1.1 Presentation of the GroupIn addition, technological innovation has been at the core of Airbus’
strategy since its creation. Each product in the Airbus family isintended to set new standards in areas crucial to airlines’ success,such as cabin comfort, cargo capacity performance, economic
performance, environmental impact and operational commonality.
Airbus innovations often provide distinct competitive advantages,
with many becoming standard in the aircraft industry.
A320 family. With more than 11,514 aircraft sold and 6,385 delivered
and currently in service, Airbus’ family of single-aisle aircraft, basedon the A320, includes the A318, A319 and A321 derivatives, aswell as the corporate jets family (ACJ318, ACJ319, ACJ320 and
ACJ321). Each aircraft in the A320 family shares the same systems,
cockpit, operating procedures and cross-section.
At 3.95 metres diameter, the A320 family has the widest fuselage
cross-section of any competing single-aisle aircraft. This provides
a roomy passenger cabin, a high comfort level and a spacious
under ﬂoor cargo volume. The A320 family incorporates digital ﬂyby-wire controls, an ergonomic cockpit and a lightweight carbon
ﬁbre composite horizontal stabiliser. The use of composite material
has also been extended to the vertical stabiliser. The A320 family’scompetitor is the Boeing 737 series.

Airbus continues to invest in improvements for the A320 family,
including the A320neo (new engine option). A320neo improvements
result in a per seat fuel burn saving of 20% compared to current
engine option (ceo) aircraft, along with additional range, reduced
engine noise and lower emissions. The ﬁrst A320neo performed
its ﬁrst ﬂight in September 2014. This activity kicked off the neo
ﬂight test and certiﬁcation programme, which is to include some
3,000 ﬂight hours across 8 aircraft. This new engine option will
be available for the A321, A320 and A319 aircraft models, with anentry-into-service targeted for Q4 2015 with the A320neo, to befollowed by the A321neo and the A319neo. The A320neo family
has won 3,621 ﬁrm orders from 70 customers since the launchin December 2010.
Airbus has enhanced its A320 family jetliners with fuel-saving
sharklets, which are available as an option on new–build A320ceo
aircraft, standard on the A320neo product line, and offered as a
retroﬁt for in-service A319s and A320s from 2015. The sharklets
bring 4% savings in overall fuel consumption on long route sectors
to A320 aircraft.
In 2014, Airbus received 1,545 gross orders for the A320 family of
aircraft (1,321 net), and delivered 490 aircraft.

A320 FAMILY TECHNICAL FEATURES (CURRENT VERSION)

Entry-into-service

Passenger capacity(1)

A318

2003

107

5,750

31.4

34.1

A319

1996

124

6,850(2)

33.8

35.8

A320

1988

150

6,100(2)37.6

35.8(3)

A321

1994

185

5,950

44.5

35.8(3)

Model

Range (km)Length (metres)

Wingspan (metres)(1) Two-class layout.
(2) Range with sharklets.
(3) Wingspan with sharklets.

A330 family. With 1,467 aircraft sold and 1,154 delivered andcurrently in service, the A330 family covers all market segmentswith one twin-engine aircraft type and is designed to carry between
250 and 300 passengers. The A330 family offers high levels of
passenger comfort as well as large under-ﬂ oor cargo areas.
The competitors of the A330 family are the Boeing 767, 777 and787 aircraft series.
Airbus now offers further enhanced performance by increasing
the maximum take-off weight (MTOW) capability up to 242 metrictonnes. This 242 tonnes capability will be ﬁrst applied to the larger
A330-300 model and subsequently to the A330-200. Entry-intoservice of the 242 tonnes A330-300 is aimed for 2015.

Airbus officially launched the A330neo (new engine option),comprising the A330-800neo and A330-900neo versions, inJuly 2014. The A330neo aircraft incorporate latest generation
Rolls-Royce Trent 7000 engines. The ﬁrst delivery is scheduled
for Q4 2017.
The A330-200F is the only new generation cargo aircraft available
today that meets operational needs in the mid-size, long-haulsegment. The lower-weight A330-300 version is tailored forregional and domestic operations in high growth areas such as
Asia and China.
In 2014, Airbus received 174 gross orders for the A330 family of
aircraft (154 net), and delivered 108 aircraft to customers. Airbus
received 120 net orders for the A330neo from 6 customers.

A330 FAMILY TECHNICAL FEATURES (CURRENT VERSION)

Entry-into-service

Passenger capacity(1)Maximum range (km)Length (metres)

Wingspan (metres)

A330-200

1998

246

13,10059.0

60.3

A330-300

1994

300

11,300

63.7

60.3

Model

(1) Two-class layout.

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A380. The double-deck A380 is the world’s largest commercial
aircraft flying today. Its cross-section provides flexible andinnovative cabin space, allowing passengers to beneﬁt from wider
seats, wider aisles and more ﬂoor space, tailored to the needs ofeach airline. Carrying 525 passengers in a comfortable three-classconﬁguration and with a range of 8,400 nm / 15,700 km, the A380

offers superior economic performance, lower fuel consumption,less noise and reduced emissions. The A380’s competitor is the
Boeing 747-8.
In 2014, Airbus received 20 gross orders for the A380 (13 net), anddelivered 30 aircraft, including 3 new operators: Asiana Airlines,
Qatar Airways and Etihad Airways.

A380 TECHNICAL FEATURES

Model
A380-800

Entry-into-service

Passenger capacity(1)Maximum range (km)Length (metres)

Wingspan (metres)

2007

525

15,70073.0

79.8(1) Three-class layout.

A350 XWB family. The A350 XWB is an all-new family of widebody aircraft, designed to accommodate between 276 and369 passengers. The A350 XWB features A380 technology, awider fuselage than that of competing new generation aircraft,
and a greater use of composite material. The A350 XWB’s maincompetitors are the Boeing 787 and 777 aircraft series.

In 2014, Airbus received 57 gross orders for the A350 XWB(-32 net), for a total of 780 ﬁrm orders from 40 customers.
The ﬁrst A350 XWB has been delivered on 22 December 2014 tolaunch customer Qatar Airways.

A350 XWB FAMILY TECHNICAL FEATURES

Model

Entry-into-service

Passenger capacity

Maximum range (km)Length (metres)

Wingspan (metres)

A350-900

2014

315

14,35066.8

64.7

A350-1000

2017

369

14,80073.7

64.7

Customer Services
Airbus Customer Services’ prime role is to help its customers
operate their Airbus ﬂeet safely and proﬁtably and to the satisfactionof passengers. As a result of its continued growth, Airbus’ customer
base has increased consistently over the past years reaching
8,000 aircraft in-service operated by 400 airlines. The Airbus ﬂeet
is maintained by 80 Maintenance and Repair Organizations andpartially owned by 100 leasing companies.
A worldwide network of more than 4,700 people covers all areasof support from technical engineering / operational assistance andspare parts supply, to crew and personnel training. Hundreds oftechnical specialists provide Airbus customers with advice andassistance to Airbus customers 24 hours a day, 7 days a week.
There are more than 250 representatives positioned around theworld in more than 150 stations close to the airlines they serve,
and an international network of support centres, training centres
and spares’ warehouses.
Beyond the core customer support activities, Airbus Customer
Services department has developed a wide range of modular
and customised services driven by the unique added valuethat an aircraft manufacturer can bring. These services are
clustered around ﬁve main domains of activity: aircraft services,material services, upgrade services, Training and Flight Ops
services and e-solutions. Innovative and integrated solutions
have been developed in these domains, such as the Flight
Hour Services Component programme (FHS Component) andTailored Support Package (FHS TSP), which provide integrated

engineering / maintenance and component packages to enable
customers to reduce their investments and support costs while
increasing operational reliability.
Part of Airbus’ growth strategy in the area of customer services
consists of industrialised development. One great achievementof this strategy implementation is the creation of a 100% Airbus
subsidiary company named SATAIR Group in January 2014: aworld leading supplier of aircraft parts and service solutions
for aircraft maintenance. The merger of the state-of-the-art
service & support portfolios manager Satair and Airbus Material
Management enhances availability of product and service forairlines’ daily operation.

Customer Finance
Airbus favours cash sales, and does not envisage customer
ﬁnancing as an area of business development. However, Airbus
recognises the commercial need for manufacturers to assist
customers in arranging ﬁnancing of new aircraft purchases, and incertain cases to participate in ﬁnancing those aircraft for the airline.
Extension of credit or assumption of exposure is subject tocorporate oversight and monitoring, and follows strict standardsof discipline and caution. Airbus’ dedicated customer ﬁnance teamhas accumulated decades of expertise in aircraft ﬁnance. When
Airbus ﬁnances a customer, the ﬁnanced aircraft generally serveas collateral, with the engine manufacturer participating in theﬁnancing. These elements assist in reducing the risk borne by
Airbus. Airbus’ customer ﬁnancing transactions are designed to

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1.1 Presentation of the Groupfacilitate subsequent sell-down of the exposure to the ﬁnancial
markets, third-party lenders or lessors.
In 2014, Airbus continued to beneﬁt from market appetite for both
aircraft ﬁnancing and sale and leaseback lessor opportunities. The
markets, however, remain unpredictable and Airbus continues toallow for potential additional ﬁnancing exposure. Management
believes, in light of its experience, that the level of provisioning
protecting Airbus from default costs is adequate and consistent
with standards and practice in the aircraft ﬁnancing industry. See“— Management’s Discussion and Analysis of Financial Condition
and Results of Operations”.

Asset Management
The Airbus Asset Management Division was established in 1994 to
manage and re-market used aircraft acquired by Airbus, originallyas a result of customer bankruptcies, and subsequently in thecontext of certain buy-back commitments. The Division operates
with a dedicated staff and manages a ﬂeet comprised of used
Airbus aircraft across the range of models. Through its activities,
the Asset Management Division helps Airbus to respond more
efﬁciently to the medium- and long-term ﬂeet requirements of its
customers.
Its key roles comprise commercial and risk management of the
Airbus used aircraft portfolio, as well as the enhancement of all
Airbus products’ residual value. Most of the aircraft are available
to customers for cash sale, while some can also be offered on
operating lease whereby the Airbus Asset Management team thenfocuses on the sell down of the aircraft with lease attached.
At the end of 2014, the Airbus Asset Management portfolio
contained 41 aircraft. Across the year 2014 the Airbus AssetManagement Division succeeded to place 29 used aircraft.
The Asset Management Division also provides a full range ofremarketing services, including assistance with entry-into-service,interior reconﬁguration and maintenance checks.

Production
Industrial Organisation
Each task in the building of Airbus aircraft (from design toproduction) is allocated to a designated plant. The Airbus plants
are typically organised around different aircraft components andsections, in component delivery teams. Each component delivery
team is either in charge of one aircraft programme, or organisedby manufacturing technology clusters depending on the optimum
solution for each plant. Every plant is organised with production,engineering, quality, supply chain, manufacturing, engineeringand logistics capabilities to ensure a seamless production ﬂow
of operations.

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A transversal “Industrial Strategy & Systems” Centre ofCompetences is in charge of ensuring that harmonised andstandardised processes, methods and tools are developed andimplemented across the plants, in order to increase efﬁciency,
based on best practices.
Following production by the respective plants, the various aircraft
sections are transferred between the network of sites and the ﬁnal
assembly lines using dedicated transport means, such as the“Beluga” Super Transporters. To support the A380 production
ﬂow, Airbus has also integrated road, river and sea transport.
Programme management is then responsible for the ﬁnal assemblyline activities. The programme management works closely with theplants to secure delivery of aircraft sections to the ﬁnal assemblylines on time, cost and quality.
A new Airbus A320 family ﬁnal assembly line is currently underconstruction in Mobile, Alabama (US). Aircraft assembly is planned
to begin in 2015, with ﬁrst delivery of a Mobile-assembled aircraft
expected in 2016.

Engineering
Airbus Engineering is a global organisation that develops complete
aircraft and aircraft components and conducts research thatcan be applied to the next generation of aircraft. The “Centresof Competence” that make up Airbus Engineering operatetransnationally, with most engineers employed in France, Germany,
the UK and Spain. A growing population of experienced aerospaceengineers worldwide are employed at ﬁ ve further engineering
centres in Wichita (Kansas, US), Mobile (Alabama, US), Moscow(Russia), Bangalore (India) and Beijing (China).
A key part of the Airbus engineering organisation is the architect
and integration centre, which ensures, together with a team ofsenior aircraft architects and the programme chief engineers, thata consistent and multi-disciplinary approach is applied during
aircraft development.
In 2014, Airbus has successfully achieved the Type Certiﬁcationand EIS of the A350-900 XWB. The A320neo has successfullycompleted its ﬁrst ﬂight and the A330neo has been launched.
The Research & Technology portfolio has been adapted tobalance incremental innovations for existing aircraft and keeping
breakthrough technologies. Airbus Engineering has also beena major contributor to a number of international initiatives
dedicated to reducing the impact of aviation on the environment.
The main target of these initiatives is to reduce both noise andCO2 emissions of Airbus aircraft. The Airbus Engineering change
project continuously improves the way-of-working and increases
efﬁciency.

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1.1.3

Airbus Helicopters

Introduction and Overview

Focusing on customers

Airbus Helicopters is a global leader in the civil and militaryrotorcraft market, offering one of the most complete and modern
ranges of helicopters and related services. This product range
currently includes light single-engine, light twin-engine, medium
and medium-heavy rotorcraft, which are adaptable to all kinds of
mission types based on customer needs.

Airbus Helicopters also marked significant progress with its
transformation plan in 2014 by further enhancing customer supportand services, with safety as the top priority. This was underscoredby indictators of increasing ﬂeet availability for customers andoperators, backed by 98 percent of planned spare parts ordered
delivered on time.

Airbus Helicopters delivered 471 helicopters in 2014 (497 in 2013)
and received 426 gross orders in 2014 (compared to 444 grossorders in 2013). Order Intake amounted to € 5.5 billion (2013:€ 5.7 billion) including 402 net orders of Commercial Helicopters
before backlog adjustment of -33 NH90. Civil contracts accounted
for 52% of this order volume, with military sales representing theremaining 48%. At the end of 2014, Airbus Helicopters order bookstood at 893 helicopters (2013: 995 helicopters).

Airbus Helicopters also established an extended warranty offer
to include three years or 2,000 ﬂight hours, with the ﬁrst year oflabor included. Taking effect on 1 January 2015, this initiative isaligned with the company-wide transformation and demonstrates
the priority placed on customer satisfaction.

As a result of the 2014 activity, Airbus Helicopters retained its leadby delivering nearly one out of every two civil rotorcraft provided
worldwide.
In 2014, Airbus Helicopters recorded total revenues of € 6.5 billion,
representing 10.7% of the Group’s revenues.

Strategy
Airbus Helicopters’ strategy is to continue driving improvement
initiatives via its company-wide transformation plan, which places
customer satisfaction and quality at the core of its operations, alongwith increasing industrial competitiveness – all while ensuring thehighest levels of aircraft safety.

A Commitment to Innovation
The enhancement of Airbus Helicopters’ existing product range
marked an unprecedented achievement in 2014: the certiﬁcationand service introduction of three new aircraft. They consist of the
7-metric-ton-category EC175 (certiﬁcation in January, ﬁrst threedeliveries in December); the medium-sized EC145 T2 (certiﬁcationin April, ﬁrst delivery in July); and the company’s EC135 T3/P3
versions (certiﬁcation in October, ﬁrst delivery in December).
Development also continued on the new H160 medium-weighthelicopter, which marked its ﬁrst power-on milestone during 2014.
The H160 – which is on track for its initial ﬂight in 2015, with service
entry planned in 2018 – will be the ﬁrst new rotorcraft developed
under Airbus Helicopters’ name, and as such will embody the new
Airbus Helicopters brand. It is a 5- to 6-ton twin-engine helicopter
tailored for a wide range of applications – including oil and gas
operations, emergency medical services, public services, businessand private aviation.
In addition, the company’s Helionix® digital avionics suite began
ﬂying on two in-service aircraft – the EC145 T2 and EC175 – offering
new technological advancements for customers. This represents
an industry ﬁrst for a rotorcraft manufacturer’s own development
and integration of such an advanced system.

Delivering safety
Safety continues to be a top-level priority for Airbus Helicopters,
which advanced this company-wide effort in several ways during
2014 – encompassing industry-leading efforts to propose andpromote changes to enhance airworthiness, increase survivability
and promote standardis ation of operator fleet safety-related
capabilities.
In a related step, Airbus Helicopters released the rotorcraft industry’s
ﬁrst Flight Crew Operations Manual (FCOM), which outlines bestpractices and recommendations for EC225 helicopters used in Oiland Gas missions. The company also broadened the incorporationof Vision 1000 cockpit records across the Airbus Helicopters
product line – to be included on all of new aircraft deliveries in 2015.

Market Drivers
According to market forecasts produced by Airbus Helicopters,
the Teal Group and Honeywell, between 9,500 to 11,500 civil
helicopters and 6,000 (Teal Group excluding China and Russia)
to 9,000 military helicopters are expected to be built globallyover 10 years. This forecast, particularly with respect to themilitary sector, relies to a large extent on large US development
programmes.
Helicopters sold in the civil and parapublic sector, where Airbus
Helicopters is a leader, provide transport for private owners andcorporate executives, offshore oil operations, diverse commercial
applications and state agencies, including coast guard, police,
medical and ﬁre-ﬁghting services. Airbus Helicopters believes
that the demand over the next 10 years will be driven by large
replacement needs from advanced economies and by growth fromemerging economies. Airbus Helicopters’ market data indicatesthat in 2014, worldwide deliveries of civil and parapublic turbine
helicopters over a 1.3t MAUW stood at 736 units.
Demand for military helicopters is mainly driven by budgetary andstrategic considerations, and the need to replace ageing ﬂeets.
Airbus Helicopters believes that the advanced age of current ﬂeets,
the emergence of a new generation of helicopters equipped withintegrated systems and the on-going introduction of combat
helicopters into many national armed forces will contribute to

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increased military helicopter procurement over the next few years.
Recent large-scale military programmes, such as those conductedby the US, Russia, China, India, South Korea, Saudi Arabia, Brazil
and most western European countries have conﬁrmed this trend.
Nevertheless, demand from the military sector has historically been
subject to large year-to-year variations due to evolving strategic
considerations, and short-term growth potential may be limited
due to increasing budgetary constraints on public spending insome regions like Europe, while other regions like Asia or Latin
America are expected to continue growing. According to Airbus
Helicopters’ market data, worldwide deliveries of military turbine
helicopters stood at ~870 units in 2014.

Competition
Airbus Helicopters’ primary competitors in the civil and parapublic
sector are Agusta-Westland, Sikorsky and Bell Helicopter. The
civil and parapublic sector has grown more competitive in recent
years, with Sikorsky and Agusta-Westland having increased theirmarket share in the heavy and medium helicopter classes, while
Bell has increased its market share in the light helicopter classes.
The military sector is highly competitive and is characterisedby competitive restrictions on foreign manufacturers’ access tothe domestic defence bidding process, sometimes to the virtual
exclusion of imports. Airbus Helicopters maintained its share of
the global market for military helicopters in unit and value (11%in unit in 2013 and 2014), and will focus on campaigns in 2015.

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Airbus Helicopters’ main competitors in the military sector are
Agusta-Westland in Europe, and Sikorsky, Boeing and Bell
Helicopter in the US Military sales accounted for 48% of Airbus
Helicopters’ revenues in 2014.

Customers
More than 3,000 operators currently fly Airbus Helicopters’rotorcraft in over 150 countries. Airbus Helicopters’ principal
military clients are Ministries of Defence (“MoDs”) in Europe, Asia,
the US and Latin America. In the civil and parapublic sector, Airbus
Helicopters has a leading market share in Europe, the US andCanada.
With 44% of the worldwide market share based on deliveries,
the versatility and reliability of Airbus Helicopters products havemade them the preferred choice of the most prominent civil andparapublic customers. The world’s largest offshore operators (suchas Bristow, CHC, Era and PHI) use Airbus Helicopters rotorcraft
for passenger transport and offshore oil industry support. In theemergency medical services market segment, Airbus Helicoptersrotorcraft dominate the ﬂ eets of large operators such as Air
Methods in the US and ADAC in Germany. Agencies with highserviceability requirements, including police and armed forces,
also rely on Airbus Helicopters products.

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Products and Services
Airbus Helicopters offers a complete range of helicopters that covers nearly the entire civil and military market spectrum, which it
updates continuously with leading-edge technologies. This product range includes light single-engine, light twin-engine, medium andmedium-heavy helicopters, and is based on a series of new-generation platforms designed to be adaptable to both military and civil
applications. In addition, products share multiple technical features as part of a family concept approach.
The following table sets forth Airbus Helicopters’ existing product line, consisting of optimised products for different mission types:
Helicopter TypePrimary Missions

Light Single Engine
EC120 “Colibri”

Corporate / Private, Commercial Pax Transport & Multipurpose, Civil & Military Training

Single Engine (“Ecureuil” family)
Public Services(1), Military Utility(2) & Armed Reconnaissance, Corporate /Private, Commercial Pax Transport & Aerial Work

AS350 “Ecureuil” / AS550 “Fennec”
EC130

Commercial Pax Transport & Multipurpose, Emergency Medical, Tourism, Corporate / Private

Light Twin Engine
AS355NP / AS555
EC135 / EC635 / EC135 T3/P3

Public Services(1), Commercial Pax Transport & Multipurpose, Corporate / Private
VIP, Military Utility & Armed Reconnaissance, Emergency Medical, Public Services(1)VIP, Military Utility(2), Emergency Medical, Public Services(1)EC145 / LUH (UH-72) / EC645 / EC145 T2
Medium (“Dauphin” family)
AS365 “Dauphin” / AS565 “Panther”

Military Naval Warfare Mission & Maritime Security, Public Services(1)(in particular Coast Guard & SAR), Oil & Gas, Commercial Pax Transport & Multipurpose

EC155

Corporate / Private, VIP, Oil & Gas, Public Services(1)EC175

Corporate / Private, VIP, SAR, Emergency Medical, Public Services(1), Oil & Gas

Medium-Heavy
AS332 “Super Puma” / AS532 “Cougar”

Civil Utility, Military Transport / SAR, Oil & Gas
SAR, Combat-SAR, Military Transport, Oil & Gas, VIP, Public Services(1)EC225 / EC725
NH90 (TTH / NFH)

SAR, Military Transport, Naval

AttackTiger

Combat, Armed Reconnaissance / Escort(1) Public Services includes homeland security, law enforcement, fire-fighting, border patrol, coast guard and public agency emergency medical services.
(2) Civil Utility includes different kinds of commercial activities such as aerial works, electrical new gathering (ENG), passenger and cargo transport.

Civil Range

Military Range

Airbus Helicopters’ civil range includes light single-engine, lighttwin-engine, medium and medium-heavy helicopters, which areadaptable to all mission types based on customer needs. To
maintain and strengthen its competitive edge in the civil sector,
Airbus Helicopters is pursuing a fast-paced product range renewal.
This entails upgrades of existing platforms as well as development
for the next generation of helicopters.

Airbus Helicopters’ military range comprises platforms derived
from its commercial range (such as the EC725 derived from theEC225) as well as purely military platforms developed for armed
forces (the NH90 and the Tiger).

The newest products in this range are the EC175, EC145 T2 andEC135 T3, each of which performed its ﬁrst ﬂight and enteredcommercial service in 2014.
For its next-generation helicopter family, Airbus Helicopters is
actively working on development of the H160 – the successor tothe current Dauphin family, which is to perform its ﬁrst ﬂight in 2015.
Beneﬁtting from innovative features and technology, the H160 willoffer signiﬁcantly improved performance, lower fuel consumption
and noise emissions.

Designed for modern multi-mission capabilities and costeffectiveness throughout its lifecycle, the NH90 has been developed
as a multi-role helicopter for both tactical transport (TTH) andnaval (NFH) applications. The programme, mainly ﬁnanced by thegovernments of France, Germany, Italy and the Netherlands, hasbeen jointly developed by Airbus Helicopters, Agusta-Westlandof Italy and Fokker Services of the Netherlands as joint partners
in NATO Helicopter Industries (“NHI”) in direct proportion totheir countries’ expressed procurement commitments. Airbus
Helicopters’ share of NHI is 62.5%. There were 53 NH90 deliveriesin 2014, for a cumulative total of 232 deliveries as of the end of 2014.
The Tiger combat attack helicopter programme includes four
variants based on the same airframe: the HAP (turreted gun,rockets and air-to-air missile), 40 of which have been ordered
by France and 6 by Spain; the UHT (antitank missile, air-to-air
missile, axial gun and rockets), 80 of which have been ordered by

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Germany; the ARH (antitank missile, turreted gun and rockets), 22
of which have been ordered by Australia; and the HAD (antitank
missile, air-to-air missile, turreted gun, rockets and upgradedavionics and engines), 24 and 40 of which have been ordered by
Spain and France, respectively. During 2014, Airbus Helicopterscompleted the Tiger helicopter programme’s main development
contract, enabling deliveries of the ﬁrst three Block 2 Tiger HAD
ﬁre support and destruction version to France, along with twoof the HAD/E variant to Spain. Overall in 2014, 12 Tigers weredelivered, for a cumulative total of 120 deliveries by year-end.
The Tiger ﬂeet has accumulated more than 67,700 ﬂight hours.

Customer Services
With more than 3,000 operators in over 150 countries, Airbus
Helicopters has a large ﬂeet of some 12,000 in-service rotorcraftto support. As a result, customer service activities to support thislarge ﬂeet generated 42% of Airbus Helicopters’ revenues for 2014.
Airbus Helicopters’ customer service activities consist primarily of
maintenance, repairs, spare parts supply, training and technicalsupport. In order to provide efﬁcient worldwide service, Airbus
Helicopters has established an international network of subsidiaries,
authorised distributors and service centres.

1.1.4

Production
Airbus Helicopters’ industrial activities in Europe are conducted infour primary locations, two in France, one in Germany and one in
Spain. The French sites are Marignane, in southern France, and La
Courneuve, near Paris. The German site is located in Donauwörth,and the Spanish site is located in Albacete.
In the US, Airbus Helicopters, Inc. has two industrial sites: Grand
Prairie, Texas and Columbus, Mississippi. Grand Prairie serves
as the company’s headquarters and main facility and also serves
as the Airbus Helicopters Training facility for North America. The
Columbus facility is dedicated to the assembly and delivery of the
UH-72A Lakota and AS350.
In Australia, Australian Aerospace assembles, upgrades andmaintains NH90 and Tiger for the country’s armed forces; whilea rotary-wing centre of excellence in Helibras — Itajuba, Brazil
produces, assembles and maintains EC725 helicopters acquiredby the Brazilian armed forces.

Airbus Defence and Space

Introduction and Overview
Airbus Defence and Space combines the activities of the former
Divisions Astrium, Cassidian and the Airbus entity Airbus Military.
The new Division, which was launched in January 2014, develops
and engineers cutting-edge products in the ﬁ eld of defence
and space, enabling governments, institutions and commercial
customers alike to protect resources and people while staying
connected to the world. Airbus Defence and Space solutions
guarantee sovereignty in foreign affairs and defence matters.
Airbus Defence and Space comprises four Business Lines: Military
Aircraft; Space Systems; Communications, Intelligence & Security(CIS); and Electronics.
Military Aircraft designs, develops, delivers and supports
military aircraft, and is the leading ﬁxed-wing military aircraft
centre in Europe and one of the market leaders for combat,
mission, transport and tanker aircraft worldwide. Key products
include the Euroﬁghter, the A400M, the A330 MRTT and theC295/CN235 as well as the development of Unmanned Aerial
Systems.
■
Space Systems covers the full range of civil and defence spacesystems. Its satellite system solutions for telecommunications,
earth observation, navigation and science include spacecraft,
ground segments and payloads. As the European prime
contractor for launchers, orbital systems and space exploration,
its key systems include Ariane launchers in the framework of a
joint venture with Safran, the French deterrence force and theEuropean participation to the International Space Station ISS(COLUMBUS research laboratory, space cargo vehicle ATV andoperations).
■

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Communications, Intelligence & Security (CIS) is the new“one-stop-shop” for satellite and terrestrial communications,
intelligence and security services and solutions. The customer
base encompasses both the government sector – notably
defence and security forces – and the commercial sector,
including transportation (maritime, airport, metro), energy (oil,gas and electricity), mining and agriculture. Key services andsolutions include: military and commercial satellite communication
services, Professional Mobile Radio communications, emergency
response centres (such as 9-1-1/112), border surveillancesystems, command & control (C4I) systems, cyber security
solutions and services and observation-satellite-based geoinformation services.
■Electronics provides high-performance equipment for system
integrators that serve both Airbus Defence and Space within the
Airbus Group as well as external customers worldwide. Products
are mainly for the civil, defence and security markets and coverground, maritime, airborne and space applications. Key products
include radars and IFF systems, electronic warfare equipment,
avionics, space platform electronics, space payload electronics
as well as optronic sensors.
■

The integration of the formerly separated defence and spacebusinesses inside the new Division is accompanied by acomprehensive change programme called COMPETE, which
drives synergies and savings across the whole organisation.
In 2014, Airbus Defence and Space recorded total revenues of€ 13.0 billion, representing 21.4% of the Group’s revenues.

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StrategyMarketThe strategic goal of Airbus Defence and Space is to be a
global market leader in Space, Military Aircraft and Missiles andrelated services. Airbus Defence and Space aims to preserve its
leading position in European defence and space and to build aninternational footprint in selected countries, delivering benchmark
ﬁnancial performance and sustainable growth. While currently
reshaping its portfolio to focus on core capabilities, Airbus Defence
and Space is ready to play a proactive and leading role in shaping
the future of defence and space industries in Europe and beyond.

Airbus Defence and Space is mainly active in public and parapublic markets. As a general trend, defence budgets are ﬂat orcontracting in Europe. Market access outside the home countries
may be subject to restrictions or preconditions such as national
content. Nevertheless Airbus Defence and Space, in conjunction
with Airbus Group, has already a strong export orientation as wellas international presence and partnerships and will continue todevelop them.

Space. Airbus Defence and Space has taken a signiﬁcant step
towards future competitiveness in launchers with the creationof the joint venture with Safran. This company, Airbus Safran
Launchers, will assume full industrial responsibility for developing
and producing the next-generation European launcher, Ariane 6.
As a leading manufacturer of satellites for telecommunications,
earth observation, navigation and science, as well as of orbital
systems and propulsion, Airbus Defence and Space is continuously
investing in innovation to ensure its future positioning in these coresegments. In addition, the ability to provide related equipment
and services through its space electronics, geo-intelligence andgovernment communications programme lines enables Airbus
Defence and Space to offer fully integrated space solutions to
its customers.
Military Aircraft. Airbus Defence and Space is capitalising on its
strong market position in transport, mission and combat aircraft
and related services. In heavy transport the focus will be oncompleting the development and delivering the A400M airlifter
to its launching customers while ramping up sales campaigns inorder to address the signiﬁcant demand expected for this aircraft
worldwide. For light & medium transport, Airbus derivatives –including the highly successful A330 MRTT (multi-role tanker
transport) – and the Euroﬁghter combat aircraft, further export
opportunities will be pursued while investing in future capability
growth and innovation. Airbus Defence and Space is also aiming
at establishing a substantive presence in the market for unmanned
aerial systems (UAS).
Missiles are a growing and proﬁtable business, in which Airbus
Defence and Space plans to expand its activities. Through aparticipation in MBDA and its military launcher business, Airbus
Defence and Space has a strong presence in this market segment.
The Portfolio Review clearly identified the Division’s corebusinesses, which will serve to guide future investment decisions.
Its implementation naturally includes plans to divest businesses
that are no longer considered as core, including secure landcommunications, business communications and a number ofparticipations and subsidiaries. Furthermore, security and defence
electronics were identiﬁed as areas in which to explore alternative
industrial set-ups in order to ensure the long-term successful
positioning of these businesses.

Military Aircraft
Customers
The Military Aircraft Business Line with its products Combat
Aircraft, Military Transport Aircraft, Special Mission Aircraft andUnmanned Aerial Systems supplies the public sector, mainly armed
forces.
Customer relationships in this segment are characterised by theirlong-term, strategic nature and long decision-making cycles. Oncea contract is signed, contract life including considerable services
business often carries on for decades.
Customers in the home countries of Airbus Defence and Space
face budget pressures. Ageing material leads to the need for someongoing or upcoming procurement decisions even in Europe, suchas France’s announcement for 12 A330 MRTT in 2014. However,
the major focus is on export.
Unmanned Aerial Systems could lead to diversification into
commercial markets. It is also a sector in which Europe has astrong need for investment, which could set the stage for newcooperation programmes.

Competitors
The market for military aircraft is dominated by large- and mediumsized US, European, Ukrainian and Russian companies capableof complex system integration. Among the competitive factors areaffordability, technical and management capability, the ability todevelop and implement complex, integrated system architectures
and the ability to provide timely solutions to customers. In particularspecial mission aircraft, such as heavy tankers, are derived fromexisting aircraft platforms. Adapting them requires thoroughknowledge of the basic airframe, which generally only the aircraft
manufacturer possesses. The skills necessary for the overallsystems integration into the aircraft are extensive and the numberof participants in the world market is very limited.
The main competitors in military transport and mission aircraft
include Antonov, Boeing, Finmeccanica and Lockheed Martin.
Heavy military transport (> 14 t payload) has been driven historicallyby US policy and budget decisions, and therefore has been
dominated by US manufacturers. The A400M represents theGroup’s entry into this market, at a time when nations worldwide
are expected to begin upgrading and replacing their existing ﬂeets.
Competitors in the segment of combat aircraft include Boeing,
Dassault, Lockheed Martin, Saab and Sukhoi.

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1.1 Presentation of the GroupIn the Unmanned Aerial Systems market segment, Israeli and US
ﬁrms are well established and other European companies such as
BAE Systems, Dassault and Thales compete for new European
projects.

constitutes the predominant ﬁeld of activity in this segment andAirbus Defence and Space leads as prime contractor on industrial
level the European contribution to the international Space Station
ISS.

Market Trends

Airbus Defence and Space is the sole prime contractor for the
Ariane 5 launcher system, with responsibility for the delivery to
Arianespace of a complete and fully tested vehicle. It also supplies
all Ariane 5 stages, the equipment bay, the ﬂight software as wellas numerous sub-assemblies. With the Joint Venture Airbus Safran
Launchers, Airbus Defence and Space is well positioned for thedevelopment and subsequent delivery of the future Ariane 6
launcher, planned for ﬁrst launch in 2020.

The sale of aircraft is expected to remain sound in the transportand special mission aircraft segments and even grow considerably
for the heavy transport segment, where the A400M occupies a
unique position leading to a market forecast of 300 to 400 units
within the next 20 to 30 years.
Our combat aircraft, Euroﬁghter, might still see a number of sales
prolonging its production life. However, growth is not expected.
Unmanned Aerial Systems, on the other hand, have a very promising
growth potential. Market structures in this segment are not clearly
set out yet and will see some movement, including perhaps a new
European collaborative programme. Airbus Defence and Space
together with Dassault and Finmeccanica have teamed up in 2014
to make a proposal from the industrial side. Potential customers are
now assessing their military requirements and budget availability.
After-Sales Services are an important business for Military Aircraft.
Whereas the practice is well established in the area of combat
aircraft, the services business is only just ramping up in the areaof transport and mission aircraft.

Space Systems
Public Sector: Satellites, Space Infrastructure, Launchers,
Deterrence
In the public market for Earth observation, scientiﬁc / explorationand navigation satellites, competition in Europe is organised ona national and multinational level, primarily through the European
Space Agency (ESA), the European Commission (EC) and national
space agencies.
Decisions at the latest ESA Ministerial Conferences and under EC
Horizon 2020 paved the way for future European programmes inwhich Airbus Defence and Space does or may seek to participate.
There is also important export demand for Earth observation
systems, for which the company is a leading provider. The export
market is expected to continue growing over the medium-term.
For military customers, demand for telecommunication andobservation satellites has increased in recent years.
The equipment segment can rely on a stable European market,
with potential growth to come from developing space countries
as well as the US.
The orbital infrastructure segment comprises manned andunmanned space systems mainly used for space exploration,i.e. scientiﬁc missions. Demand for orbital infrastructure systems
originates solely from publicly funded space agencies, in particularfrom ESA, NASA, Roscosmos (Russia) and NASDA (Japan). Suchsystems are usually built in cooperation with international partners.
The International Space Station (ISS), together with related
vehicle and equipment development programmes and services,36

Airbus Defence and Space is the prime contractor for ballistic
missile systems to the French State. It is responsible for thedevelopment, manufacturing and maintenance of submarinelaunched missiles and related operating systems.

Commercial Sector: Telecommunications Satellites,
Launch Services
The commercial telecommunication satellite market is very
competitive, with customer decisions primarily based on price,technical expertise and track record. The main competitors fortelecommunications satellites are Boeing, Lockheed Martin, Loral
and Orbital in the US, Thales Alenia Space in France and Italy, andInformation Satellite Systems Reshetnev in Russia. The market for
telecommunications satellites is expected to remain largely stable
over the coming years at a level of approximately 20-22 orders
per year on average.
The market for commercial launch services continues to evolve.
Competitive pressure is increasing in light of other competitors
entering or coming back into the market. Airbus Defence and Spaceis active in providing launch services through its shareholdingin Arianespace, Starsem and Eurockot. Competitors for launchservices include ILS, SpaceX, ULA, Sea Launch and CGWIC. The
accessible market to Arianespace for commercial launch services
for geostationary satellites is expected to remain stable at around20 payloads per year. However, due to various factors (such astechnology advances and consolidation of customers), this ﬁgure
remains volatile. This market does not include institutional launchservices for the US, Russian or Chinese military and governmental
agencies.

Communications, Intelligence and Security (CIS)
The business line Communications, Intelligence and Security (CIS)
is a “one-stop-shop” for the growing but increasingly competitivemarket for satellite and terrestrial communication, intelligence andsecurity services and solutions. CIS serves a common customer
base which includes governments, defence institutions, security
and public safety agencies, as well as commercial sectors suchas transportation (maritime, airport, metro), energy (oil, gas,
electricity), mining and agriculture.
This business line is divided in ﬁve segments: Integrated Systems,
GEO-Intelligence, Satellite Communications, Secure Land
Communications and Cyber Security.

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1.1 Presentation of the GroupThrough Integrated Systems, Airbus Defence and Space develops
Command and Control solutions for Ministries of Defence andborder security and emergency response systems for Ministriesof the Interior in Europe and Middle East. The market is very
fragmented, with competitors coming from defence, telecom,
infrastructure and IT businesses.
CIS also dominates the satellite imagery (optical and radar) market
for GEO-Intelligence. This sector remains mainly government
orientated. However, the demand for satellite imagery is growing
in commercial markets as many companies see geospatial data
as key information for their business development.
The business line CIS is also a leader in commercial andgovernmental satellite communications. This segment offers a full
portfolio of mobile and ﬁxed satellite communication solutions forapplication at sea, on land and in ﬂight. Customers are Ministriesof Defence, the commercial maritime sector as well as energy andmining businesses, humanitarian NGOs and the media.
The Secure Land Communications segment is a major actor
worldwide for Professional Mobile Radio (PMR) networks andterminals solutions as well as call taking solutions for public safety
answering and control room. Main customers are Ministries of
the Interior and critical infrastructures, i.e. police, ﬁre brigades,
ambulances, airports, and metro lines.
Airbus Defence and Space is also a leading provider of consulting
services for products of cyber security. The market growth isdriven by the explosion of cyber-attacks and this trend is foreseen
also in the next years. Customers are governments and privatecompanies.
Airbus Defence and Space has good market position in all
businesses covered in CIS. However, maintaining or improving
its position would require important investments in some areas
such as Secure Land Communications or Commercial Satellite
Communications Services. Airbus Defence and Space is seeking
owners more suitable to develop these business areas further.
The portfolio review concluded on a focus on public customers
such as armed forces for government satellite communications,where we have long-term relationships with our customers.
Whereas budget pressures on public expenditure, above all military
expenditure, are high in Europe, investment into the services andsolutions offered by CIS is likely to continue in the face of new
global security threats.

Electronics
For integrated civil, defence and security systems, the BusinessLine Electronics designs, develops and delivers electronic
components and products. It brings together the electronics
activities of the former Cassidian Division in the areas of optronics,
radars, electronic warfare and avionics with those of former Astrium
in the segments of space platform electronics and space payload
electronics.
The integration of expertise from various defence and spacecompetencies creates a broad basis of high-end technologies.
The Business Line provides mission-critical premium electronics

to all Airbus Group platforms and is a longstanding partner ofsystem integrators worldwide.
In addition to supplying the public sector market – armed forces andsecurity forces – directly, Electronics often acts as a subcontractor
for system integrator companies of land, sea, air or space vehicles,
including but not limited to Airbus Defence and Space. Affordability,
innovativeness and top quality are key competitive factors, towards
external customers as well as within the Group.
This business line is composed of two main business clusters for
defence application and space equipment.
In the defence business cluster, Airbus Defence and Space designs
develops and produces radar, avionics solutions, optronic devices,
electronic warfare and self-protection systems. Customers arearmy and security forces worldwide in a market headed by big
US players and Thales in Europe. Airbus Defence and Space has
a focus on deﬁned market segments and is well positioned in thegroup of the non-US players.
Concerning the space business cluster, Airbus Defence and Space
designs, develops, and manages equipment for space platforms,
such as solar arrays, power electronics, data handling devices
and gyros. Through its subsidiary TESAT-Spacecom, payload
equipment for telecommunication satellites are produced, e.g.
ampliﬁ ers, multiplexer, switches and modulators. Customers
are satellite prime contractors worldwide in a highly fragmented
market with over 50 different companies operating in it. Electronics’
customers are primarily system integrators, but direct sales to
end-customers are not uncommon.
Following the portfolio review of Airbus Defence and Space it
was decided to explore a new industrial set-up for the security
and defence electronics business enabling the sustainable
development of its growth potential.

Products and Services
Military Aircraft
A400M — Heavy military transport. The A400M is the mostversatile and outstanding all-new airlifter ever conceived and uniquein its kind. It is designed to meet the needs of the world’s Armed
Forces and other potential operators for military, humanitarian andpeacekeeping missions in the 21st century. The A400M does thejob of three different types of military transport and tanker planes
conceived for different types of missions: Tactical (short to medium
range medium airlifter capability with short, soft and austere ﬁeld
operating performance), strategic (longer range missions for large
payloads), as well as tanker.
A total of 174 aircraft have been ordered so far by the seven launchcustomer nations Belgium, France, Germany, Luxemburg, Spain,
the UK, Turkey and one export customer, Malaysia. Type Certiﬁcate
and Initial Operating Clearance have been achieved in 2013. Since
then, ten units have been delivered to four nations by the endof 2014. 2014 also saw the ﬁrst operational deployments of the
A400M by France in missions to Africa and transatlantic as wellas the activation of the ﬁrst operational A400M squadron, the

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1.1 Presentation of the GroupET 1/61 “Touraine”. Capabilities will be added progressively withparatrooper systems, cargo systems, defensive and protective
military systems and air-to-air refuelling to be integrated.

More than 880 orders have been recorded for all three types
together and in various conﬁgurations. The order backlog is stableat roughly 30 units or around one and a half years of production.

Multi-role tanker transport — A330 MRTT. The A330 MRTT,a derivative of the Airbus A330 family, offers military strategic airtransport as well as air-to-air refuelling capabilities. Its large tankcapacity is sufﬁcient to supply the required fuel quantities without
the need for any auxiliary tanks. This allows the entire cargo bay to
be available for freight, with the possibility of incorporating standard
LD3 or LD6 containers, military pallets and/or any other type of load
device in use today. A corner stone of the A330 MRTT programmeis the Aerial Refuelling Boom System (ARBS). It is designed toprovide a refuelling performance that is substantially faster thanthat of the competition – a considerable advantage given thevulnerability of the aircraft during the refuelling procedure. At theend of 2014, a total of 35 aircraft were ordered by six nations, ofwhich 22 already delivered and in service in four nations.

Unmanned Aerial Systems. In the ﬁ eld of unmanned aerial
systems (UAS), Airbus Defence and Space is active both inplatforms and systems. It provides tactical UAS like Tracker, Tananand Atlante; medium-altitude long-endurance (MALE) systems like
Harfang; and systems for the high-altitude long-endurance (HALE)
EuroHawk (based on the Global Hawk platform). Airbus Defence
and Space is also working on development of next generation
systems for a common European UAS (future European MALE).
Finally, Airbus Defence and Space contributes to the Research andTechnology programme “Agile UAV in net-centric environment” forthe German armed forces, using its company-ﬁnanced Barracuda
technology demonstrator.

Euroﬁghter Combat Aircraft. The Euroﬁghter multi-role combat
aircraft (referred to as Typhoon for export outside of Europe) has
been designed to enhance ﬂeet efﬁciency through a single ﬂying
weapon system capable of fulﬁlling both air-to-air and air-to-ground
missions.
The Euroﬁghter GmbH shareholders are Airbus Defence and Space(46% share), BAE Systems (33% share) and Finmeccanica (21%share). With regard to series production, the respective production
work shares of the participating partners within the Euroﬁghter
consortium stand at 43% for Airbus Defence and Space, 37.5%
for BAE Systems and 19.5% for Finmeccanica. Airbus Defence
and Space develops and manufactures the centre fuselage, ﬂight
control systems, identiﬁcation and communication sub-systems,
and the right wing and leading edge slats for all aircraft, and is incharge of ﬁnal assembly of aircraft ordered by the German andSpanish air forces.
As of 31 December 2014, a total of 571 Euroﬁghter aircraft had beenordered by seven customers (UK, Germany, Italy, Spain, Austria,
Saudi Arabia and Oman), with a total of 428 aircraft delivered.
Production of aircraft within the core programme is scheduled tolast until 2018, while further export opportunities are believed toexist worldwide.
C212, CN235, C295 — Light and Medium military transport.
The Light and Medium military transport aircraft family, today
essentially the CN235 and C295, are the work horses of militarytransport, deployed in demanding environments (meteorologicalconditions, operational complexity…) such as the search for
Air France ﬂ ight AF447 and AirAsia ﬂ ight QZ8501, Operation
Atalanta (European counter-piracy mission off the Horn of Africa),
Afghanistan, and Sinai peacekeeping. Payloads range from 2.8t
for the C212 to 9t for the C295. The aircraft are built in the mostvaried versions and conﬁgurations, for example maritime patrol
and anti-submarine warfare, airborne early warning and control,
ﬁreﬁghting, medical evacuation, paratrooping etc. In more than
40 years in service, this family of aircraft has proven to be robust,reliable, high-performing, efﬁcient, ﬂexible, easy to operate in any
environment, and all this at very low operating costs.

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Customer Services. For all the afore mentioned products,
Airbus Defence and Space offers and provides various services
throughout the lifetime of the aircraft including integrated logistics
support, in-service support, maintenance, upgrades, training or
ﬂight hour service. For example, the A330 MRTT contract with the
UK Ministry of Defence through the AirTanker consortium includes
alongside 14 aircraft the provision for all necessary infrastructure,training, maintenance, ﬂ ight management, ﬂ eet management
and ground services to enable the Royal Air Force to ﬂy air-to-air
refuelling and transport missions worldwide. Customer services
go beyond the ﬂeet of aircraft currently in production at Airbus
Defence and Space, conducting upgrade programmes for aircraft
such as the Tornado and C-160 Transall. The support centres formilitary aircraft are strategically located throughout the world, forexample in Seville or Manching in Europe, in Mobile, Alabama (US)or in subsidiaries in Saudi Arabia or Oman.

Space Systems
Manned Space Flight. Airbus Defence and Space has been theprime contractor for the European part of the International Space
Station ISS. This includes the development and integration of
Columbus, the pressurised laboratory module on the International
Space Station (ISS) with an independent life-support system
successfully in orbit since 2007. It provides a full-scale research
environment under microgravity conditions (material science,
medicine, human physiology, biology, Earth observation, ﬂ uid
physics and astronomy) and serves as a test-bed for new
technologies.
In 2011, ESA awarded Airbus Defence and Space a contract tomanage the continued operation of the European components of
the ISS as the lead partner in an industrial consortium. The contract
represents the ﬁrst phase of a long-term service agreement for
the entire planned service life of the ISS until 2020.
Airbus Defence and Space was also the prime contractor for thedevelopment and construction of the Automated Transfer Vehicle(ATV) cargo carrier, designed to carry fuel and supplies to the ISS
and to provide re-boost capability and a waste disposal solution.
The ﬁfth and last ATV was launched in July 2014. The expertise
gained on the ATV served to become the prime contractor for the

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European service module of the US Orion programme for humanspace exploration.
Launch services. Airbus Defence and Space is active in the ﬁeld of
launch services through shareholdings in Arianespace (for heavylift launchers), Starsem (for medium-lift launchers) and Eurockot(for small-lift launchers):
Arianespace. Airbus Defence and Space is Arianespace’s second
largest shareholder (after CNES) with a 32.5% stake (direct andindirect), and its largest industrial shareholder. Arianespacemarkets and sells the Ariane launcher worldwide and carries
out launches from the Guiana Space Centre in Kourou, French
Guiana.
■Starsem. Airbus Defence and Space directly owns 35% ofStarsem, a French corporation, along with Arianespace (15%),
the Russian space agency (25%) and the Russian state-owned
Samara Space Centre (25%). Through Arianespace, Starsem
markets launch services by Soyuz launchers for medium-weightspacecraft into low or sun-synchronous orbits as well as forinterplanetary missions.
■
Eurockot. Airbus Defence and Space (51%) and Khrunichev(49%) jointly control Eurockot Launch Services, which provides
launch services for small, low-Earth orbit satellites with Rockot
launchers derived from SS-19 ballistic missiles. In 2013, Eurockot
launched the SWARM satellites of ESA, designed and built by
Airbus Defence and Space.
■

Commercial launchers. Airbus Defence and Space manufactures
launchers and performs research and development for the Ariane
programmes. Member states, through ESA, fund the development
cost for Ariane launchers and associated technology. Airbus
Defence and Space has been the sole prime contractor for the
Ariane 5 system since 2004. In December 2014, the Ariane 6
programme was decided by ESA ministerial conference with anapproval of the joint Airbus Defence and Space and Safran concept.
In addition a new industrial set-up was announced with the creationof a Joint Venture (Airbus Safran Launchers) between the two main
Ariane manufacturers. This vertical integration secures the future
by cutting costs and being more competitive. Ariane 6 is targeted
to be launched in 2020.
Telecommunication satellites. Airbus Defence and Space
produces telecommunication satellites that may be used for civilor military applications, such as television and radio broadcasting,ﬁxed and mobile communication services and Internet broadband
access. Current Airbus Defence and Space geostationary
telecommunication satellites are based on the Eurostar family of
platform, the latest version of which is the Eurostar E3000. At theend of 2014, the order backlog stands at 11, with approximately
four launches per year.
Observation and scientiﬁ c / exploration satellites. Airbus
Defence and Space supplies Earth observation satellite systems
including ground infrastructures for both civil and military
applications. Customers can derive signiﬁcant beneﬁts from thecommon elements of Airbus Defence and Space’s civil and militaryobservation solutions, which allow the collection of information forvarious applications, such as cartography, weather forecasting,climate monitoring, agricultural and forestry management, mineral,energy and water resource management, as well as militaryreconnaissance and surveillance.
Airbus Defence and Space also produces scientiﬁc satellites andspace infrastructure, which are tailor-made products adapted
to the specific requirements of the mostly high-end mission
assigned to them. Applications include astronomical observationof radiation sources within the Universe, planetary explorationand Earth sciences. Airbus Defence and Space designs andmanufactures a wide range of highly versatile platforms, optical andradar instruments and equipment. For example, Airbus Defence
and Space was highly involved in ESA’s “Rosetta” mission, which
arrived at its destination, comet 67P/Churyumov-Gerasimenko, in
August 2014 and descended the lander “Philae” in November – aﬁrst in space ﬂight. Airbus Defence and Space was prime contractorof the orbiter with team in the UK responsible for the Spacecraft
Platform Engineering, in France for providing the Spacecraft
Avionics Engineering and in Spain delivering the Medium Gain
Antenna. Airbus Defence and Space also supported the German
centre for aerospace industry (DLR) with the lander systems
engineering, deployment strategy and landing gear integration.
Navigation satellites. Airbus Defence and Space plays a majorindustrial role in the “Galileo” European navigation satellite system,
which delivers signals enabling users to determine their geographic
position with high accuracy and is expected to become increasingly
signiﬁcant in many sectors of commercial activity. Airbus Defence
and Space is responsible for the Galileo in-orbit validation phase(IOV) to test the new satellite navigation system under real mission
conditions. The IOV phase covers the construction of the ﬁrst four
satellites of the constellation and part of the ground infrastructurefor Galileo. After the successful launch of the ﬁ rst two Airbus
Defence and Space Galileo IOV satellites in 2011 and 2012, thisearly constellation was successfully tested in orbit and handed
over to the customer in 2013. Airbus Defence and Space will play
an active role in the Galileo full operation capability phase (FOC)with a nearly 50% work share, including providing the payloads forthe ﬁrst 22 FOC satellites and the FOC ground control segment.
Satellite products. Airbus Defence and Space offers an extensive
portfolio of embedded subsystems and equipment for all typesof space applications: telecommunications, Earth observation,navigation, scientiﬁc missions, manned spaceﬂight and launchers.
Ballistic missiles. Following its contracts with the French State forthe submarine-launched ballistic missiles family of M1, M2, M20,
M4 and M45, Airbus Defence and Space is now under contract
to develop and produce the M51 with increased technical andoperational capabilities. In 2010, the French Defence Procurement
Agency and Airbus Defence and Space signed a contract covering
the development and production of the second version of theM51 strategic missile (M51.2), which secures Airbus Defence
and Space’s capabilities in this ﬁeld. In addition, Airbus Defence
and Space manages the operational maintenance of the M51
missile system on behalf of the French armed forces. At the end

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1.1 Presentation of the Groupof 2011, Airbus Defence and Space received a ﬁrst design study
contract in order to prepare the intended M51.3 new upper stage
development.

Communications, Intelligence and Security
Integrated Systems. Airbus Defence and Space is a provider offull systems architecture and integration for military and security
land-, sea-, air- and space-based systems. Airbus Defence andSpace designs, integrates and implements secure ﬁxed, tactical,
theatre and mobile information infrastructure solutions, including
all of the services needed to support integrated mission systems
and solutions. Airbus Defence and Space is also a designer andsupplier of C4I systems (Command, Control, Communications,
Computers and Intelligence). Airbus Defence and Space offers afull range of mission avionics systems.
Airbus Defence and Space’s lead systems integration offering
includes the ability to design, develop and integrate the widest
possible range of individual platforms and subsystems into asingle effective network. Large systems integration has become
increasingly important for customers engaged in border control
and coastal surveillance, as well as for non-military customers inareas such as homeland security.
Geo-Intelligence. Airbus Defence and Space is a provider of both
optical and radar-based geo-information services to customers
including international corporations, governments and authorities
around the world.
With the very-high-resolution twin satellites Pleiades 1A and 1B,
SPOT 6 and SPOT 7 (launched in 2014), Airbus Defence andSpace’s optical satellite constellation offers customers a high levelof detail across wide areas, a highly reactive image programming
service and unique surveillance and monitoring capabilities. Spot
6 and 7 provide a wide picture over an area with its 60-km swath,
Pleiades 1A and 1B offer, for the same zone, products with anarrower ﬁeld of view but with an increased level of detail (50 cm).
The successful launch of TerraSAR-X in 2007 — a radar-based
Earth observation satellite that provides high-quality topographic
information — enabled Airbus Defence and Space to signiﬁcantly
expand its capabilities by proposing new kinds of images basedon radar. TanDEM-X, its almost identical twin, was successfullylaunched in 2010 and achieved in 2014 WorldDEM, the ﬁrst highprecision 3-D elevation model of the entire surface of the Earth.
Satellite Communications. Airbus Defence and Space
offers commercial, government and military satellite-based
communications.
Airbus Defence and Space provides armed forces and governmentsin the UK, Germany, France and Abu Dhabi with secure satellite
communications. For example in the UK, Airbus Defence andSpace delivers in the frame of the “Skynet 5 programme” tailored
end-to-end in-theatre and back-to-base communication solutions
for voice, data and video services, ranging from a single voicechannel to a complete turnkey system incorporating terminals andnetwork management. This contract, pursuant to which Airbus
Defence and Space owns and operates the UK military satellite

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communication infrastructure, allows the UK MoD to place orders
and to pay for services as required. The service is fully operational
since 2009 and extends to 2022.
In Abu Dhabi, Airbus Defence and Space together with Thales
Alenia Space built a secure satellite communication system. Airbus
Defence and Space Services is managing the programme andsupplies the space segment except for the payload, as well as
50% of the ground segment.
In the commercial realm, Airbus Defence and Space’s morethan 200,000 end-users benefit from access to satellite
telecommunications services wherever they are in the world. These
include all maritime sectors (merchant shipping vessels, ﬁshing,yachting, etc.), oil, gas and mining companies, emergency responseorganisations, global media companies, telecommunication andinternet service providers, and civil aviation. Airbus Defence andSpace works with the broadest range of network providers in theindustry, including Inmarsat, Iridium, Thuraya, Eutelsat, Intelsat,
SES, Arabsat, Loral Skynet and Satmex.
Secure Land Communications. Airbus Defence and Space isa provider of digital Professional Mobile Radio (PMR) and secure
networks with more than 280 networks delivered in 74 countries.
Its solutions for PMR enable professional organisations in various
areas — such as public safety, civil defence, transport and industry— to communicate effectively, reliably and securely. Airbus Defence
and Space offers its customers specialised PMR solutions basedon TetraPOL, Tetra and P25 technologies. Airbus Defence andSpace’s PMR solutions were in use during events like the Beijing
Olympic Games, the Brazil FIFA World Cup and the Tour de France.
Cyber Security. Airbus Defence and Space has established acyber-security branch to meet the growing cyber security needsof users of critical IT infrastructure, including governments andglobal companies. Airbus Defence and Space provides expertiseand solutions to help such organisations protect against, detect,prevent and respond to cyber threats. Airbus Defence and Space
has a long track record in providing the most sensitive secure IT
and data handling and training solutions to defence and security
customers throughout France, Germany, the UK and other NATOcountries.

Electronics
Airbus Defence and Space’s business line Electronics is focussing
on surveillance and reconnaissance, air trafﬁ c control, signal
intelligence, mission electronics and protection. It is a partnerin the development of airborne multi-mode radars and provides
integrated logistics support, maintenance and upgrades. It is also
involved in the development and application of next-generation
active electronically scanned (AESA) radars for air, naval andground applications. In the area of air defence, Airbus Defence
and Space produces mid-range radars for ship (TRS-3D / 4D)and land (TRML-3D) applications. Synthetic aperture radars(SAR) for reconnaissance and surveillance operations and airport
surveillance radars (ASR-S) are also part of the portfolio, along with
the Spexer security radar family. A range of optronics solutions
completes Airbus Defence and Space’s offering in this ﬁeld.

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1.1 Presentation of the GroupIn the ﬁ eld of electronic warfare, Airbus Defence and Space
supplies electronic protection systems for military vehicles, aircraft
and civil installations, such as laser warning, missile warning andelectronic countermeasure units. Furthermore, the portfolio also
comprises avionics equipment, such as avionics computers, digital
map units, ﬂight data recording units and situational awarenesssystems for helicopters. Transversally, multi-sensor integrationand data fusion technology is particularly useful creating added
value by combining radars with optronic sensors and thermal
imagers from Airbus Defence and Space’s extensive Optronics
portfolio. Therein, cameras, telescopes, thermal imaging devices
and periscopes constitute indispensable elements of situationalawareness for naval, airborne and ground-based platforms.
Among the most prominent platforms equipped by the Electonics
Business Line’s products are Euroﬁghter (radar, self-protection,
avionics), the Ariane space launchers, the A400M transport aircraft(self-protection, avionics) as well as helicopters of various types.
In the area of Space technology the Electonics Business Line offers
components and sub-systems deployed in space platforms suchas on-board computers, GNSS Receivers, Launcher Electronics
and Power Electronics. Actuators and particularly reliable solar
arrays rank extraordinarily high on the company’s technology
skills. Space payload electronics comprise highly sophisticatedcomponents of communication and earth observation satellites.

MBDA
Airbus Defence and Space’s missile business in addition to French
nuclear deterrence derives from its 37.5% stake in MBDA (a joint
venture between the Company, BAE Systems and Finmeccanica).

1.1.5

MBDA offers missile systems capabilities that cover the whole
range of solutions for air dominance, ground-based air defence andmaritime superiority, as well as advanced technological solutions
for battleﬁeld engagement. Beyond its role in European markets,
MBDA has an established presence in export markets like Asia,
the Gulf region and Latin America.
The broad product portfolio covers all six principal missile system
categories: air-to-air, air-to-surface, surface-to-air, anti-ship, antisubmarine and surface-to-surface. MBDA’s product range also
includes a portfolio of airborne countermeasures such as missile
warning and decoy systems, airborne combat training and minecountermeasures. The most signiﬁcant programmes currently
under development are the anti-ship missile for the UK and Frenchnavies “Future Anti-Surface Guided Weapon (Heavy) / Anti-Navire
Léger (FASGW (H) / ANL)”, the portable battleﬁeld “Missile Moyenne
Portée (MMP)” for medium range and the “Common Anti-Air
Modular Missile (CAMM)”, which is an anti-air missile family withland, naval and in the future air launched versions as part of the“Future Local Area Air Defence System (FLAADS)”.

Production
Airbus Defence and Space is headquartered in Munich. The main
engineering and production facilities of the Division are located in
France (Paris-region and South-West France), Germany (Bavaria,
Baden-Württemberg and Bremen), Spain (Madrid-region and
Andalusia) and the UK (Southern England and Wales). In addition,
Airbus Defence and Space operates a global network of engineering
centres and ofﬁces in more than 80 countries.

Other Businesses

Regional Aircraft — ATR
ATR (Avions de Transport Régional) is a world leader in the
50- to 74-seat regional turboprop aircraft market. Its aircraft are
currently operated by more than 180 airlines in over 90 countries.
ATR is an equal partnership between Airbus Group and Alenia
Aermacchi (Finmeccanica Group), with Airbus Group’s 50% share
managed by Airbus. Headquartered in Toulouse in the south ofFrance, ATR employs more than 1200 people, with major operationsin the Midi-Pyrénées and Aquitaine regions of France. Since thestart of the programme in 1981, ATR has registered net orders for1470 aircraft (470 ATR 42s and 1000 ATR 72s).

Market
The regional turboprop aircraft industry has experienced growing
concentration over the years. During the 1990s, a numberof regional aircraft manufacturers merged, closed or ceased
production, leading to the withdrawal from the market of BAe,
Beechcraft, Fokker, Saab and Shorts, among others. Currently, theworldwide market for turboprop aircraft of 50-70 seats in production
is dominated by two manufacturers: ATR and Bombardier.

After a number of years of declining activity, the regional turboprop
aircraft market has experienced sustained growth since 2005 dueto the advantages of turboprop aircraft over jet aircraft in terms offuel efﬁciency and CO2 emissions. In 2014, ATR delivered 83 newaircraft (compared to 74 in 2013) and recorded ﬁrm orders for 160
new aircraft (compared to 89 in 2013). In 2014, ATR reached amajor milestone in its history with the signing of the 1000th orderfor the ATR 72 which will ﬂy the ﬂag of Airlines PNG, the Papua
New Guinea airline.
As of 31 December 2014, ATR had a backlog of 280 aircraft(compared to 221 in 2013). The relative lower operating cost andreduced CO2 emissions of turboprop aircraft, in an ever passengeryield constrained environment, are expected to lead to sustained
market activity over the coming years.

Products and Services
ATR 42 and ATR 72. Commencing with the ATR 42 (50-seat),which entered service in 1985, ATR has developed a family of highwing, twin turboprop aircraft in the 50- to 74-seat market that are

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designed for optimal efﬁciency, operational ﬂexibility and comfort.
In 1995, in order to respond to operators’ increasing demands
for comfort and performance, ATR launched the ATR 42-500 and
two years later, the ATR 72-500 (70-seat) series. In 2007, ATR
launched the new -600 series with improved engines, new avionics
and a new cabin. Like Airbus, the ATR range is based on thefamily concept, which provides for savings in training, maintenance
operations, spare parts supply and cross-crew qualiﬁcation. By
the end of 2014, ATR had delivered 1190 aircraft (436 ATR 42s
and 754 ATR 72s).
Customer service. ATR has established a worldwide customer
support organisation committed to supporting aircraft over theirservice life. Service centres and spare parts stocks are locatedin Toulouse, Paris, the greater Washington D.C. area, Miami,
Singapore, Bangalore, Auckland, Kuala Lumpur, Toronto andJohannesburg.
ATR Asset Management also responds to the market for secondhand aircraft by assisting in the placement and ﬁnancing of usedand end-of-lease aircraft. By providing quality reconditioned
aircraft at attractive prices, ATR Asset Management has helped
both to broaden ATR’s customer base, in particular in emerging
markets, and to maintain the residual values of used aircraft. In thepast, clients for such used aircraft have subsequently purchased
new aircraft as they have gained experience in the operation of
ATR turboprops.
In 2014, ATR continued to build its presence across the world by
establishing new partnerships for pilot training in Bangkok and
Bogota. ATR has also signed new maintenance contracts with theresult that as of today, nearly two ATR -600s out of three in service
are covered by this type of agreement with the manufacturer.

Production
The ATR fuselage is produced in Naples, Italy, and ATR wings
are manufactured in Merignac near Bordeaux, France. Finalassembly takes place in Saint Martin near Toulouse on the Airbus
production site. Flight-testing, certiﬁcation and deliveries also occurin Toulouse. ATR outsources certain areas of responsibility to
Airbus, such as wing design and manufacturing, ﬂight-testing andinformation technology.

Sogerma
Sogerma is a wholly owned subsidiary of the Company which
specialises in aerostructures and cabin interior activities. The
company designs and manufactures major aerostructure elements
in metal and composite for commercial and military aircraft and isalso a leading provider of cockpit and passenger seats (ﬁrst andbusiness class) for commercial and military aircraft as well as forbusiness jets and helicopters.
In the aerostructures market, Sogerma engages in the design,
manufacturing and assembly of Airbus aircraft sections (A318 /A320 / A330), manufacturing and assembly of ATR wings, design
and manufacturing of the A400M ramp door as well as design
and manufacturing of pilot and co-pilot seats. In the cabin interiormarket, Sogerma designs and manufactures ﬁrst and businessclass seats for large commercial aircraft.

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Sogerma employs approximately 2,000 people and has three sites
in France (Rochefort, Mérignac and Toulouse). The Mérignac site is
entirely dedicated to the ATR business. The Toulouse site (designofﬁce branch) is located near Airbus. Rochefort, the largest site interms of staff, covers a wide spectrum of activities: aerostructure,seats and cockpit seats. Sogerma also has a subsidiary in
Morocco (Maroc Aviation) as well as two subsidiaries specialisedin composites: CAQ (Composite Aquitaine) in France and CAL(Composite Atlantic) in Canada.
At the end of 2014, Sogerma and Aerolia merged to become
STELIA Group with effect from January 2015. The merger of Aerolia
and Sogerma gave rise, on 1 January 2015, to the world No. 3(as regards its turnover) in aerostructures, seats and aeronauticalequipment.

Airbus Group Inc.
Airbus Group Inc. is the American operating company of Airbus
Group. Headquartered in Herndon, Virginia, Airbus Group, Inc.
(together with its Airbus Group parent) contributes more than
$ 14 billion to the US economy annually, supporting over 225,000
American jobs. Its US Business Units, operating companies anddivisions are found in 29 locations across 15 states, offering abroad array of advanced solutions to customers in the commercial,homeland security, aerospace and defense markets.
Since its creation in 2003, Airbus Group Inc. (formerly EADS North
America) has been selected in key competitions for military aircraft
and systems. Airbus Group Inc.’s presence in the US defence andhomeland security sectors is growing as well. The company has
supplied more than 90 HH-65 rotorcraft to the Coast Guard forits vital homeland security missions. Airbus Group Inc. is prime
contractor for the supply of up to 36 HC-144A Ocean Sentry aircraft
for Coast Guard maritime patrol and support missions.
The company is also a major contractor to the US Army, having
been chosen to supply the service’s UH-72A Lakota helicopter. As
of May 2014, 300 aircraft had been delivered to the US Defense
Department for operation by Army and Army National Guard units,
as well as the Navy.
In commercial aviation, Airbus Group Inc. has a signiﬁcant US
presence including two engineering centers in Mobile and Witchita,
and Airbus Helicopters is one of the US leaders in civil helicopters.
More than 3,090 Airbus aircraft have been ordered by North
American customers, with over 2,150 delivered; while some 1,300
Airbus Helicopters rotary-wing aircraft are used by operators that
include the US Coast Guard, US Customs and Border Protection,
Los Angeles County Sheriff’s Ofﬁce and the FBI. In addition, theAirbus ﬁnal assembly line being built in Mobile, Alabama is planned
to begin assembling A320 family aircraft in 2015.

Daher-Socata
The Company sold a 70% stake in Socata to Daher Aerospacein 2009 and sold its remaining 30% stake to Daher Aerospace inJune 2014 by exercising its put option as per put and call option
mechanisms agreed with Daher Aerospace in June 2012.

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Daher-Socata specialises in the aerospace and defence, nuclear& energy and capital goods industries with a bit more than a thirdof business conducted outside France and with a 50% balance inturnover between manufacturing and services. In aerospace and1.1.6

defence, Daher-Socata is both a manufacturer and a tier-1 supplierof equipment and services with approximately 7,700 employees anda presence in 12 countries. Daher-Socata produces aerostructuresand systems, ﬁtted sections and airframes.

Investments

Dassault Aviation
As of 31 December 2014, Airbus Group held a 42.11% of the
Dassault shares with associated voting rights, with Groupe
Industriel Marcel Dassault holding a 50.6% stake and a free ﬂoatof 3.1%. Dassault Aviation itself holds a 26% stake in Thales, whichmakes it the second largest shareholder of Thales behind theFrench state. In November 2014, Dassault bought back from Airbus
Group a block representing 8% of the share capital of the Company
in an off-market block trade. Airbus Group has also provided best
efforts commitment until 30 June 2015 to sell up to 10% of Dassault
Aviation’s share capital, subject to market conditions.
Dassault Aviation is active in the market for military jet aircraft andbusiness jets. Founded in 1936, Dassault Aviation has delivered
more than 8,000 military and civil aircraft to purchasers in morethan 80 countries. On the basis of its experience as designer
and industrial architect of complex systems, Dassault Aviation
designs, develops and produces a wide range of military aircraft
and business jets. In order to avoid any potential conﬂict between
the military products of Dassault Aviation and the Group (Rafaleand Euroﬁghter) and to facilitate a “Chinese wall” approach, theCompany’s Dassault Aviation shareholding is managed by Airbus
Group Corporate, whereas the Euroﬁghter programme is managed
by Airbus Defense and Space.
In 2014, Dassault Aviation recorded orders totalling € 4.64 billion(compared to € 4.17 billion in 2013), including 90 net orders
for Falcon business jets (compared to 64 net orders in 2013).
Consolidated revenues amounted to € 3.68 billion in 2014
(compared to € 4.59 billion in 2013), with adjusted net income of€ 398 million (compared to € 487 million in 2013). Dassault has
approximately 11,600 employees, of which more than 75% arebased in France.

Mirage 2000. The Mirage 2000 family reached the end of its
production phase in 2006. Approximately 470 Mirage 2000 aircraft
are in service with nine air forces worldwide.
nEUROn. Dassault Aviation is the prime contractor for thedevelopment of the unmanned combat air vehicle demonstrator,nEUROn. The programme was open to European cooperation andﬁve countries have decided to participate and share the skills of
their aerospace industries: EADS CASA (Spain), SAAB (Sweden),HAI (Greece), RUAG (Switzerland) and Alenia Aermacchi (Italy). The
nEUROn demonstrator made its ﬁrst ﬂight in 2012 and has been
performing several test ﬂights in France since then.
FCAS (Future Combat Air System). In 2014, Dassault Aviation,
BAE Systems and their industrial partners have been awarded a€ 150m contract by the French and UK governments for a two year
co-operative FACS feasibility phase study. The joint study is tobe supplemented with additional French and UK national funding
to the combined value of € 100m in the same period. Following
the completion of the study at the end of 2016, work could thencommence on a UCAS demonstration development programmethat addresses both nations’ future military requirements.

Business Jets
Dassault Aviation offers a wide range of products at the top end of
the business jet sector. The family of Falcon business jets currently
includes the Falcon 7X, the 900 LX and the 2000 LX & S. Inservice Falcons currently operate in over 65 countries worldwide,
ﬁlling corporate, VIP and government transportation roles. At theend of December 2014, Dassault revealed the Falcon 8X which isscheduled to make its maiden ﬂight in 2015. Since the rollout of theﬁrst Falcon 20 in 1963, over 2,250 Falcon jets have been delivered.

Aerostructures, Aircraft Conversion and Floor
PanelsMilitary Jet Aircraft
Dassault Aviation offers wide expertise in the design andmanufacturing of the latest generation military jet aircraft.
Rafale. The Rafale is a twin-engine, omni-role combat aircraft
developed for both airforce and navy applications. To date,
286 Rafale aircraft have been ordered by the French MoD. In
2012, Rafale was selected by the Indian MoD to enter into exclusive
negotiations for the sale of 126 aircraft. Negotiations are still inprogress. From 2013 and onwards, the new Rafale “Omnirole” will
be delivered, with improvements such as the RBE2-AESA radar,
missile launch detector and optronics.

Elbe Flugzeugwerke GmbH — EFW
EFW (consolidated within Airbus) combines various aviationand technology activities under a single roof: development andmanufacturing of ﬂat ﬁbre-reinforced composite components forstructures and interiors, the conversion of passenger aircraft into
freighter conﬁguration, maintenance and repair of Airbus aircraft
as well as engineering services in the context of certiﬁcation andapproval.
In the business ﬁeld of composite structures and interiors, EFW
develops, designs and manufactures ﬂat sandwich components forstructure and cabin interior of the entire Airbus family. The product

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range includes ﬂoor and ceiling panels, cargo linings and bulletproof cockpit doors (in total, 50,000 different shapes and layups).
The passenger-to-freighter conversion business comprises a
standard extensive modiﬁcation, carried out by order of the civil
aircraft owner. The freighter conversion market comprises cargo
airlines, aerospace companies with small aircraft ﬂeets as well as
ﬁnance groups. As of today, more than 190 freighter aircraft havebeen converted for 39 customers throughout the world.
Airbus, ST Aerospace and EFW launched the A330 Passengerto-Freighter (P2F) conversion programme on 19 May 2012 andSTA took 35% equity interest in EFW. First conversion is plannedin 2015 (prototype). Furthermore the companies are on track towiden this cooperation to the Single Aisle market in the near future.
The A330P2F programme will offer customers two versions – theA330-200P2F and the larger A330-300P2F. Both will provide newlevels of reliability and efﬁciency to P2F operators, offering better
economics than any medium widebody freighter available today as
well as commonality with the already existing Airbus A330-200F.

Aerolia
Aerolia is a wholly owned subsidiary of the Company (consolidated
within Airbus) which was formed from the spin-off of the former
French Airbus sites in Méaulte and St-Nazaire Ville pursuant to theaerostructures reorganisation strategy initiated under the Power8
Programme. Aerolia has approximately 3,400 employees who
work on the design and manufacturing of around 6 million detailparts, panels, tubes and pipes and more than 655 sections of the
Airbus nose fuselage.
The standalone company operates with three operational
Directorates (Strategy & Commercial, Series, Development)
and three support Directorates (Quality, Finances, Human
Resources), which are geographically located on three sites:
Méaulte (1,400 employees), St-Nazaire (840 employees) andToulouse (400 employees). In 2009, a fourth site was launched
in Tunisia (750 employees) and since 2011 Aerolia launched twosites in Quebec (100 employees). The design ofﬁce, based in part

1.1.7

The activities integrated in Aerolia will maintain and develop
commercial and industrial relations mainly with Airbus, while
continuing to develop relations with others such as Bombardier,
Embraer, OGMA, Aerovodochody, ATR, Latecoere, Sonaca andSogerma.
At the end of 2014, Aerolia and Sogerma merged to become
STELIA Group with effect from January 2015. The merger of Aerolia
and Sogerma gave rise, on 1 January 2015, to the world No. 3(as regards its turnover) in aerostructures, seats and aeronauticalequipment.

Premium AEROTEC
Premium AEROTEC is a wholly owned subsidiary of the Company(consolidated within Airbus) which was formed from the spinoff of the former German Airbus sites in Nordenham and Varel
and the former Airbus Group site in Augsburg pursuant to theaerostructures reorganisation strategy initiated under the Power8
Programme. Premium AEROTEC has its own development unit
with its main facilities at its Augsburg site and ofﬁces in Bremen,
Hamburg, Munich / Ottobrunn and Manching. The management
headquarters for the operational units are in Varel, while the company
itself is headquartered in Augsburg. Premium AEROTEC GmbHalso has a plant for processing aircraft components in Ghimbav /Brasov County in Romania.
The core business of Premium AEROTEC is focused on structuresand manufacturing systems for aircraft construction and related
development activities. The aim of Premium AEROTEC over the
coming years is to further expand its position as the leading tier 1
supplier of civil and military aircraft structures.
Premium AEROTEC is a partner in all major European aircraft
development programmes, such as the commercial Airbus aircraft
families, the A400M military transport aircraft programme andthe Euroﬁghter Typhoon. It plays a signiﬁcant role in the design of
new concepts in such ﬁelds as carbon composite technologies.

Insurance

The Company’s Corporate Insurance Risk Management (“IRM”) is
an integrated corporate ﬁnance function established to proactively
and efﬁciently respond to risks that can be treated by insurance
techniques. IRM is responsible for all corporate insurance activities
and related protection for the Group and is empowered to deal
directly with the insurance and re-insurance markets. A continuous
task of IRM in 2014 was to further improve efﬁcient and appropriate
corporate and project-related insurance solutions.
IRM’s mission includes the deﬁnition and implementation of theCompany’s strategy for insurance risk management to help ensurethat harmonised insurance policies and standards are in place forall insurable risks worldwide for the Group. A systematic review,monitoring and reporting procedure applicable to all Divisions is in44

in Toulouse and Quebec, combines the skills of approximately
250 engineers and employees.

place to assess the exposure and protection systems applicable
to all the Group’s sites, aiming at the:continuous and consistent identification, evaluation andassessment of insurable risks;■
initiation and monitoring of appropriate mitigation and risk
avoidance measures for identiﬁed and evaluated insurable risks;
and■efficient, professional management and transfer of theseinsurable risks to protect the Group adequately against theﬁnancial consequences of unexpected events.
■

The Company’s insurance programmes cover high risk exposuresrelated to the Group’s assets and liabilities, as well as risk exposuresrelated to employees.

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Asset and liability insurance policies underwritten by IRM for theGroup cover risks such as:property damage and business interruption;
aerospace third party liabilities including product liabilities;■
manufacturer’s aviation hull insurance;■
commercial general liabilities including non-aviation and nonspace product liabilities and risks related to environmental
accidents; and■Director and ofﬁcers liability.
■■

Claims related to property damage and business interruption arecovered up to a limit of € 2.5 billion per occurrence. Aviation liability
coverage is provided up to a limit of $ 2.5 billion per occurrence,with an annual aggregate cap of $ 2.5 billion for product liability
claims. Certain sub-limits are applicable for the insurance policies
outlined above.
Group employee-related insurance policies cover risks such as:
personal accidents;■
medical and assistance support during business trips andassignments;■
company automobiles; and■personal and property exposure during business trips.
■

Amounts insured for such Group employee-related policies
adequately cover the respective exposure.

1.1.8

The Company follows a policy of seeking to transfer the insurable
risk of the Company to external insurance markets at reasonablerates, on customised and sufﬁcient terms and limits as provided
by the international insurance markets. All insurance policies
are required to satisfy the Company’s mandatory standards of
insurance protection.
However, to be more independent from the volatilities of the insurance
markets, the Company uses the capabilities of a corporate-owned
re-insurance captive as a strategic tool with respect to the property
damage and business interruption programme and the aerospace
insurance programme. The captive is capitalised and protectedaccording to European legal requirements so as to ensure its ability
to reimburse claims without limiting the scope of coverage of theoriginal insurance policies and without additionally exposing theﬁnancial assets of the Company.
The insurance industry remains unpredictable in terms of its
commitment to provide protection for large industrial entities. Theremay be future demands to increase insurance premiums, raise
deductible amounts and limit the scope of coverage.
In addition, the number of insurers that have the capabilities
and financial strength to underwrite large industrial risks iscurrently limited, and may shrink further in light of new solvency
requirements. No assurance can be given that the Company will
be able to maintain its current levels of coverage on similar ﬁnancial
terms in the future.

Legal and Arbitration Proceedings

Airbus Group is involved from time to time in various legal andarbitration proceedings in the ordinary course of its business,the most signiﬁcant of which are described below. Other thanas described below, Airbus Group is not aware of any signiﬁcantgovernmental, legal or arbitration proceedings (including any suchproceedings which are pending or threatened), during a period
covering at least the previous twelve months which may have, or
have had in the recent past signiﬁcant effects on the Company’sor the Group’s ﬁnancial position or proﬁtability.
Regarding Airbus Group’s provisions policy, Airbus Group
recognises provisions for litigation and claims when (i) it has apresent obligation from legal actions, governmental investigations,proceedings and other claims resulting from past events that are
pending or may be instituted or asserted in the future against theGroup, (ii) it is probable that an outﬂow of resources embodying
economic beneﬁts will be required to settle such obligation and (iii) a
reliable estimate of the amount of such obligation can be made.
Although Airbus Group believes that adequate provisions havebeen made to cover current or contemplated general and speciﬁclitigation and regulatory risks, no assurance can be provided thatsuch provisions will be sufﬁcient. For the amount of provisions forlitigation and claims, see “— Notes to the Consolidated Financial
Statements (IFRS) — Note 25c: Other provisions”.

WTO
Although Airbus Group is not a party, Airbus Group is supporting
the European Commission in litigation before the WTO. Following
its unilateral withdrawal from the 1992 EU-US Agreement
on Trade in Large Civil Aircraft, the US lodged a request on
6 October 2004 to initiate proceedings before the WTO. On
the same day, the EU launched a parallel WTO case against
the US in relation to its subsidies to Boeing. On 19 December
2014, the European Union requested WTO consultations on theextension until the end of 2040 of subsidies originally grantedby the State of Washington to Boeing and other US aerospaceﬁ rms until 2024.
On 1 June 2011, the WTO adopted the Appellate Body’s ﬁnal reportin the case brought by the US assessing funding to Airbus from
European governments. On 1 December 2011, the EU informed
the WTO that it had taken appropriate steps to bring its measures
fully into conformity with its WTO obligations, and to comply with
the WTO’s recommendations and rulings. Because the US did
not agree, the matter is now under WTO panel review pursuant
to WTO rules.
On 23 March 2012, the WTO adopted the Appellate Body’s
ﬁnal report in the case brought by the EU assessing funding to
Boeing from the US. The EU has cited the failure by the US to

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implement the ﬁndings prior to the due date of 23 September
2012 in commencing a new proceeding on the adequacy of US
compliance.
Exact timing of further steps in the WTO litigation process is subject
to further rulings and to negotiations between the US and the EU.
Unless a settlement, which is currently not under discussion, isreached between the parties, the litigation is expected to continue
for several years.

Securities Litigation
Following the dismissal of charges brought by the French
Autorité des marchés financiers for alleged breaches of market
regulations and insider trading rules with respect primarily to theA380 delays announced in 2006, a French investigating judge
decided in November 2013 to send the case to trial (renvoi
devant le tribunal correctionnel) against 7 current and former
executives that exercised their stock options in March 2006 as
well as two former shareholders. On 3 October 2014 the criminal
court suspended the case on the merits and decided to request
a preliminary ruling (question prioritaire de constitutionnalité)
from the French Supreme Court on the constitutionality of theFrench dual prosecution system (AMF and judicial proceedings).
In December 2014, the French Supreme Court transmitted theconstitutional challenge to the Conseil Constitutionnel. On
18 March 2015, the Conseil rendered its decision declaring
relevant provisions of the French Financial and Monetary Codeunconstitutional. This decision should ultimately put an end tothe criminal prosecution, at least against the 7 current and former
executives.

Euroﬁghter Austria
In March 2012, the German public prosecutor, following a request
for assistance by the Austrian public prosecutor, launcheda criminal investigation into alleged bribery, tax evasion andbreach of trust by current and former employees of EADS
Deutschland GmbH (renamed on 1 July 2014 Airbus Defence
and Space GmbH) and Euroﬁghter Jagdﬂugzeug GmbH as well
as by third parties relating to the sale of Euroﬁghter aircraft toAustria in 2003. After having been informed on the investigation in2012, Airbus Group retained law ﬁrm Clifford Chance to conduct
a fact ﬁnding independent review. Upon concluding its review,
Clifford Chance presented its fact ﬁnding report to Airbus Groupin December 2013. Airbus Group provided the report to the publicprosecutors in Germany. Airbus Group is cooperating fully withthe authorities.

Other investigations
Public prosecutors in Greece and Germany launched investigations
into a current employee and former ofﬁcers and employees of Atlas
Elektronik GmbH, a joint company of ThyssenKrupp and Airbus
Group, on suspicion of bribing foreign ofﬁcials and tax evasion.
The public prosecutor in Germany has launched an administrative
proceeding for alleged organisational and supervisory shortfalls.
The authorities in Greece have launched civil claims against
Atlas Elektronik GmbH. With the support of its shareholders,the company is cooperating fully with the authorities and in
consultation with the public prosecutor is assisting the further
clariﬁcation of the matter through its own internal investigation.

Commercial Disputes
GPT
Prompted by a whistleblower’s allegations, Airbus Group
conducted internal audits and retained PricewaterhouseCoopers(“PwC”) to conduct an independent review relating to GPT Special
Project Management Ltd. (“GPT”), a subsidiary that Airbus Groupacquired in 2007. The allegations called into question a service
contract entered into by GPT prior to its acquisition by Airbus
Group, relating to activities conducted by GPT in Saudi Arabia.
PwC’s report was provided by Airbus Group to the UK Serious
Fraud Ofﬁce (the “SFO”) in March 2012. In the period under review
and based on the work it undertook, nothing came to PwC’s
attention to suggest that improper payments were made by GPT.
In August 2012, the SFO announced that it had opened a formal
criminal investigation into the matter. Airbus Group is cooperating
fully with the authorities.

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In the course of another commercial dispute, the Group has received
in the third quarter 2013 a statement of claim alleging liability forrefunding part of the purchase price of a large contract which thecustomer claims it was not obliged to pay. The Group believes that
this claim which goes back many years ago should be dismissed
in principle. Options to resolve the dispute are under review but
eventually it may be decided in the course of the arbitration.
In July 2013, the Group became the subject of a commercial dispute
following the expiry of a partnership study for winglet devices with a
US supplier. The Group believes it has solid grounds to legally object
to the alleged breach of a commercial non-disclosure agreement.
However, the outcome and consequences of this dispute cannot
be assessed at this stage.

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1.1.9

Research and Technology, Intellectual Property

Research and Technology
Keeping Airbus Group at the forefront
Airbus Group’s technological expertise is essential for maintaining
the differentiation of its products and ensuring the long-term market
leadership of the Company and its Divisions.
The Group’s Research and Technology efforts are focusedon proﬁ tability, value creation, market position and delivering
competitive, integrated solutions for its customers. In alignment
with Airbus Group’s overall strategy, this approach seeks todevelop incremental innovations that exploit potential within theGroup’s current products and programs, while also preparing
next-generation breakthroughs.
The Airbus Group Corporate Technical Ofﬁce (CTO) is the focal
point for Research and Technology across the company, ensuringthat business and technology strategies are closely linked. The
CTO addresses current, emerging and future technology trends
that directly impact the Group’s business, and identiﬁes key areasfor Research and Technology. It is responsible for the Airbus Group
Innovations Research and Technology network and also manages
information technology, cyber security, quality and Intellectual
property activities across the Group.

Establishing a roadmap for the future
Corporate-level Research and Technology efforts are centeredaround four common roadmaps for innovation across Airbus
Group: highly efﬁ cient production processes, new hybrid andelectric propulsion concepts, on-board energy management andautonomy.
Elaborated by the Divisions under the leadership of the Corporate
Technical Ofﬁce, these shared roadmaps were created for fasterdelivery of new technologies by optimizing Group-wide Research
and Technology efforts.
A key part of the technology roadmaps is the development ofdemonstrators that provide shared results and data to strengthen
company-wide expertise and accelerate the introduction of
innovations in the Division’s new products and programs.
Supporting technologies such as electronics and computing also
are an integral part of each common roadmap and are developed
at a compatible pace.

A global network for innovation
Airbus Group Innovations — the company’s global Research
and Technology network, which is managed by the Corporate
Technical Ofﬁ ce — is driven by the Group’s overall Research
and Technology strategy. It leverages a close relationship withall Divisions to identify new technologies and prepare them foreventual transfer to the Group’s commercial Business Units.
This global operation’s teams are organised into seven transnational
technical capability centres, which cover competences that arehighly important to the Group’s core businesses and create

long-term value. Airbus Group Innovations and the company’s
Research and Technology community in the Divisions also
maintain and develop partnerships with leading universities andhigh-tech engineering schools through joint research projects,
as well as employment of thesis students, post-graduate interns
and doctorates.
Airbus Group Innovations employs over 1,000 people across sites
in France, Germany, UK, Spain, Singapore, India, the US andRussia, along with its operations in China, Malaysia and Canada.
This international presence increases Airbus Group’s access todiverse talent and knowledge, disruptive technologies and newmarkets, which improves the company’s ﬂexibility, robustness
and ability to innovate.

It’s electric
One of the Group’s key priorities for the future is developing aroadmap to electric and hybrid-propulsion aircraft. The CTO isleading these efforts and has established an “E-aircraft Roadmap”
with the long-term goal of developing electrically-powered
helicopters and 90-passenger-category regional airliners.
In 2014, Airbus Group Innovations performed the ﬁrst public ﬂight
of its two-seat, all-electric E-Fan demonstrator aircraft in France,
which was followed by E-Fan’s appearances at major aviation
tradeshows. This was a signiﬁ cant display of Airbus Group’s
progress on the “E-Roadmap,” as well as a stepping stone fordevelopment of the E-Fan 2.0 two-seat pilot trainer and four-seat
E-Fan 4.0 version by an Airbus Group Innovations-led industrial
team. The E-Fan 2.0 is targeted for service entry in late 2017 as
the ﬁrst all-electric production aircraft in the world certiﬁ ed tointernational standards by civil airworthiness authorities.

Improving quality for customers
Airbus Group has launched a company-wide quality improvement
strategy with the aim of delivering even better products andservices to its customers.
Designated the Quest Initiative, this Corporate Technical Ofﬁcemanaged operation is focused on improving customer satisfaction
and loyalty, reducing the cost of non-quality, and embedding aculture of quality across the Group. In 2014, the Quest Initiative wasrolled out across the Group’s Divisions, Airbus, Airbus Helicoptersand Airbus Defence and Space.

Product Lifecycle Management
Product Lifecycle Management (PLM) is a core industrial enabler
for new Airbus Group products like the H160, X6, Ariane 6 andE-Fan but also for incremental innovation developments in the
Airbus commercial NEO aircraft range. Standardisation forinteroperability of processes & tools is one cornerstone of theDigitalization strategy of the company. Achievements during
2014 included the simpliﬁ cation and streamlining of overall

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1.1 Presentation of the GroupPLM governance; the release of a major international standardof interoperability (STEP AP242) and the contribution to thesuccessful ramp-up of EC175 Airbus Helicopters programme bysupporting the on-time delivery of the advanced PLM suite.

Protecting the Group’s cyber assets
Airbus Group Corporate Technical Office’s Cyber Security
Programme Directorate is responsible for safeguarding thecompany’s assets in three key areas: product security, industrial
control systems security and information technology security.
This operation combines all of the Group-wide competences
behind common objectives and establishes priorities for protecting
the Group from the increasing threat of cyber attacks in the shortand long-terms.

Intellectual property
Intellectual property rights – including patents, trademarks,
copyrights and know-how – enable the company to remaincompetitive in the market, freely manufacture and sell its products
and prevent competitors from exploiting protected technologies.
Airbus Group’s policy is to establish, protect, maintain and defend
its rights in all commercially signiﬁcant countries and to use thoserights in responsible ways.
The Company is also committed to making select patents
and expertise available through licensing agreements to help
companies outside the Group to develop new products, improve
production methods and expand their market opportunities.
Under the CTO’s responsibility, the Airbus Group Technology
Licensing initiative generates revenues by licensing approved
technologies – such as the AFDX® data network developed by
Airbus and Airbus Group Innovations’ DeltaN FS® friction-stirwelding system – from the Company’s large patent portfolio andrelated know-how.
In 2014, Airbus Group also signed a key licensing agreementwith Maserati that established a long-term strategic partnershipwith this Italian luxury automobile manufacturer, which provides
broad access to make in-depth reviews of the Group’s portfolioof patented technologies over a multi-year period.

Spin-off companies
The Airbus Group Corporate Technical Office fosters anentrepreneurial spirit with a series of Airbus Group-managed
spin-off companies. Examples include TESTIA – Airbus Group’s
subsidiary for non-destructive testing and training; APWORKS,
which offers consulting and engineering services around aportfolio of state-of-the-art technologies for advanced production
processes; and SPEETECT, a company that is developing a device
for rapid detection of bacteria in water.
Many of these initiatives are backed by Airbus Group’s Innovation
Nursery, a CTO operation which helps develop and commercialise
disruptive capabilities outside the Company’s core areas ofbusiness.

Key priorities for 2015
Airbus Group’s overall Research and Technology efforts —managed by the Corporate Technical Ofﬁce organisation — willplay a signiﬁcant role in all of the Company’s 2015 objectives.
Leveraging even closer working relationships between Airbus,
Airbus Helicopters, Airbus Defence and Space and Airbus
Group Innovations, the CTO will continue to advance the Group’s
technological roadmaps with a sustained focus on accelerated
delivery of technological innovations.

1.1.10 Environmental Protection
Protection of the environment is a global priority that implies
commitment and responsibility from citizens, governments andindustry. The Company continuously pursues sustainability by
setting the standards for an eco-efﬁcient company, considering it
to be a major strategic goal. Eco-efﬁciency aims at maximising the
beneﬁts of the Company’s products and services for customers
and other stakeholders while minimising the environmental impact
of manufacturing and operating these products throughout theirlifecycle. The implementation of further innovative and ecoefﬁcient technologies and processes is a key factor in ensuring
the Company’s sustainability, increasing the attractiveness of
its products and its overall competitiveness, creating growth,safeguarding employment and adding value for all stakeholders.
Environmental topics are fast-changing, and the Company
is preparing itself for both long-term and rapid changes by
anticipating issues, engaging with stakeholders, and deploying
the ERM to environmental issues. Identifying the related risks andopportunities to act proactively demonstrates our robustness, andis evidence of a well-prepared company.

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Organisation
While each Division, Business Unit and corporate function remains
responsible for the implementation of the Company’s environmental
policy in pursuit of eco-efﬁciency, Corporate Environmental Affairs
ensures the consistency of the various initiatives group-wide. This
team is intended to leverage capabilities, avoid duplications ofresponsibilities, mitigate environmental risks, limit the capacity
needed to provide an expanded service and strengthen the
Company’s responsiveness by:anticipating environmental issues, monitoring and sharing
information on emerging trends globally and on legislative activity
concerning environmental matters;■
supporting the lobbying and communication activities of theDivisions on environmental issues in their respective sectors andhelping to coordinate a group-wide position when necessary;■
encouraging the sharing of best practices and fosteringcommunications through the Company’s Environmental
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complying with the Group’s reporting obligations and ensuring aconsistent standard of reporting by the Group’s entities.

The Company is supporting joint initiatives throughout theindustry to improve the overall environmental performance of
the aerospace and defence industry in the most consistent andefﬁcient manner. The Group supported the creation of the IAEG
(International Aerospace Environmental Group) which gathers
most manufacturers and suppliers of the aerospace and defence
industry. It aims at harmonising the response of the industry to
existing and emerging environmental regulations, as well as aligningaerospace environmental standards. Airbus is also involved at theinternational level within ICAO to develop a global framework forthe management of CO2 emissions that will combine environmental
standards with fair and level market conditions.
Similary, the Group leads or participates in various European andinternational environmental working groups such as ICAO, ATAG,ICCAIA, ASD, CAEP and WEF, and in national trade associations
such as GIFAS in France, TEDAE in Spain, BDLI in Germany and
ADS in the UK.

Eco-Efﬁciency Approach
The eco-efﬁciency concept is about maximising economic value
creation while minimising environmental impact. It was ﬁrst deﬁned
by the World Business Council for Sustainable Development(WBCSD) as a “concept of creating more goods and services
while using fewer resources and creating less waste and pollution”.
Airbus Group has set a structured approach in order to embed
eco-efﬁciency at all levels of the Company. This principle is fully
supported by an environmental policy providing strategic directions
and entailing regulatory compliance and continuous improvement
in environmental management. By adopting an eco-efficientapproach, the Company intends to reduce recurring costs byimproving resource efﬁciency, secure growth by driving innovation,
expand its environmental products and services portfolio andstrengthen its identity as an eco-efﬁcient enterprise among its
stakeholders. The Company also seeks to implement a common
culture on environmental topics across Divisions and countries
through the development of employee awareness, encouraging
employees to take action, inspiring them and making them proud
to be part of a responsible company.

Environmental Management (ISO 14001 / EMS)
ISO 14001 is an internationally recognised standard of environmental
management system efﬁciency for businesses and organisations.
The Company encourages not only the environmental certiﬁcationof its operations but also the development of a full lifecycle
orientation for its products and services, as this remains the mostcost-efﬁcient and practical way to effectively reduce environmental
impacts. Certiﬁed environmental management systems have been
progressively implemented across the Company’s manufacturing
sites, and approximately 83% of the Company’s employees
operate under an ISO 14001 certiﬁcation. The site and productlifecycle orientation of the environmental management system
attempts to create economic value by reducing environmental
costs and exposure at each stage of the product life, from design
to operations up to end of life.

In 2006, Airbus became the ﬁrst aeronautical manufacturer to becertiﬁed for all its sites, products and services. With this ISO 14001
certiﬁcation still in place today, Airbus has demonstrated its ability
to continually improve its environmental performance. Airbus
Helicopters has also achieved ISO 14001 certiﬁcation in France,
Germany, Spain, the UK, and more recently, in Singapore, Canada
and the USA. Airbus Defence and Space operates a fully integrated
Business Management System, and is also ISO14001 certiﬁed.
Monitoring of the various achievements against objectives isbeing performed through the collection of a set of indicators.
The consistency and reliability of the reporting exercise is being
ensured through corporate procedures and guidelines derived
from Global Reporting Initiative (“GRI”) requirements, combinedwith an advanced environmental management information systemthat is operational within the Company worldwide.

Products and Services
A lifecycle-oriented approach takes into account all stages ofthe life of a product or service, from the design of the productto the end of its lifetime. The Company’s main target is to work
towards developing more eco-efﬁcient products by promoting
and supporting eco design and environmental innovation andto identify business opportunities for eco-efﬁcient products andspeciﬁc services portfolios.

Designing for the Environment
Reducing the environmental impacts throughout the life cycleof products and services provides a competitive advantage byimproving efﬁciency and ensuring compliance with regulations.
Recognising this, Airbus Group is coordinating the integration of
eco-design in the Divisions to reduce the environmental impact
of products and manufacturing activities. As an example, since2014 all of Airbus’s new technologies are reviewed at each of
their maturity stages (known as technology readiness levels) to
see if their environmental impact can be reduced. In time, thisapproach will spread to Airbus Helicopters and Airbus Defence
and Space. From a manufacturing perspective, Airbus Group is
studying best practices at Airbus and Airbus Helicopters to see
how their leading-edge manufacturing techniques can be used
across the Group. One of these initiatives is Airbus Helicopters’“Lean and Green” methodology developed to optimise the Starﬂex
rotor hub manufacturing. Substantial savings have been identiﬁedby analysing each stage of the manufacturing process in order to
identify potential improvements in industrial efﬁciency (cost, timecycle) and environmental impacts (waste, energy, volatile organic
compounds).
The Airbus A350 XWB is designed to be eco-efﬁcient throughout its
life cycle and will open new perspectives in terms of environmental
performance in the long-range market, with 25% less fuelconsumption than the current generation of aircraft. Satisfying
regulatory noise best standards, it also displays comfortable
margins in hydrocarbon emissions (99% below limit), carbon
monoxide emissions (86% below limit), smoke emission (60% below
limit) or NOx emission (35% below limit). The New Engine Option(NEO) developed for the A320 family, combined with large wingtip devices (Sharklets), will allow a 15% fuel economy compared

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1.1 Presentation of the Groupto older generation aircraft. In the meantime, the 152 A380s inservice around the world have demonstrated a 20% reduction in
fuel-burn and emissions compared to the competition.
Airbus Helicopters’ EC145 T2 has demonstrated a substantial
noise reduction (–8.5 dB below the threshold values of ICAO)
thanks to its Fenestron® anti-torque system, and noise certiﬁcation
data demonstrate that this evolution decreases the cumulativecertiﬁcation noise levels by 5dB.
Airbus Defence and Space is developing electric engines as asatellite technology to replace chemical propulsion for orbit-raisingmanoeuvres. As part of ESA’s Neosat project, future satellites
will be designed to use electric propulsion to join their orbit after
separation from the launcher, and to maintain their position once
on station.

Operating in the Most Efficient Way
The most obvious way to cut CO 2 emissions is to reduce fuelconsumption. This can be done through improvements in aircraft
technologies as well as streamlining air trafﬁc management.
Sustainable aviation fuels are also an option that Airbus is exploring
to reduce aviation’s CO2 emissions. The Company is continuously
teaming with cross-industry partners to fully explore the potential
beneﬁts of new fuel sources. Over 1,500 sustainable aviation fuelpowered ﬂights have taken place around the world so far, andAirbus works with farmers and reﬁners worldwide on developing
sustainable aviation fuel production for regular ﬂights.
Airbus is also involved in air trafﬁc management, especially with
its subsidiaries, Airbus Prosky and Metron Aviation, and throughinternational partnerships involving Europe’s SESAR (Single
European Sky ATM Research) and NextGen in the United States.
The company is committed to integrating air trafﬁc management
systems in order to make air movement even more efﬁcient.
When combining all the above initiatives, CO2 emissions can be
drastically reduced. As an example, Air France and Airbus teamed
up to complete the world’s ﬁrst Perfect Flight, a commercial ﬂight
combining the latest fuel and air trafﬁc management technologies.
This ﬂight from Toulouse to Paris using an Airbus A321, cut theamount of CO2 emitted in half compared to a regular ﬂight.
In May 2014, an Airbus A330-200 of KLM Royal Dutch Airlines (ﬂight
KL767) undertook the longest commercial ﬂight with sustainable
jet fuel ever performed by an Airbus aircraft. The aircraft took off
for a 10-hour ﬂight from Schiphol airport to the Dutch Caribbean
island of Aruba using a 20% blend of sustainable fuel made ofused cooking oil. This ﬂight was the ﬁrst of a series of around 20
long-haul commercial ﬂights in the frame of the ITAKA European
initiative of which Airbus is a key partner (Initiative Towards
sustainable Kerosene for Aviation) which aims to speed up thecommercialisation of aviation biofuels in Europe.

Monitoring the environment
Satellite technology is monitoring changes in the environment,
giving governments and other agencies greater understanding.
Airbus Defence and Space is a key partner for the European

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Space Agency, building satellites for its environmental monitoring
activities, including the Copernicus Earth observation programme.
Copernicus’ series of Sentinel satellites, set for launch from 2014
onwards, will improve management of the environment, as well as
understanding and mitigation of climate change, and ensure civil
security. In addition, Airbus Defence and Space is prime contractor
for the Aeolus wind monitoring satellite that conducts atmosphericmodelling, beneﬁting climate research.
Airbus Defence and Space is pioneering services that quantify
the greenhouse gas emissions of cities and countries in close toreal time. This allows governments, cities and local authorities tomeasure the effectiveness of their emission reduction policies.
The project is proﬁled on the UN Climate and Energy Action Hub,an online UN platform that allows businesses supporting UN goals
to seek partners. It has already begun emissions mapping in Parisand Rotterdam, following testing in London.
Enhanced imagery from Airbus Defence and Space’s constellationof both optical and radar satellites is helping to monitor deforestationand manage agricultural land use with higher image resolution
than ever before. SPOT 7 will join its twin, SPOT 6, and the
Pleiades constellation in 2014 in a phased orbit and will be used
by UN REDD (Reducing Emissions from Deforestation and Forest
Degradation) projects in major forest zones such as the Congo
Basin and Indonesia. These projects aim to protect standing
forest by providing a means to monetise their value, which they
do by trading avoided emissions on voluntary carbon markets. In
the agriculture sector, SPOT satellites contribute to sustainable
practices by helping farmers to make the right decisions regarding
irrigation and the optimal use of pesticides and fertilisers. This
service is particularly valuable for planning, risk management andland use purposes.

Reducing Industrial Environmental Impact
In order to meet stakeholders’ increasing demands for environmental
impact-related information, further movement towards eco-efﬁcientindustrial activities, and in anticipation of more stringent reporting
regulations, the Company communicates on its environmental
performance around clear guidelines derived from GRI as well as
greenhouse gas protocol requirements. Consolidated data havebeen externally audited since 2010 and are published every year
within the CR&S report. In 2014, some 13 indicators were veriﬁed,
including energy consumption, CO2 emissions, waste production
and water consumption.
Airbus Group’s drive to improve eco-efﬁ ciency is reﬂ ected inconcrete progress across the Divisions and their industrial facilities.
The results are: -24% in energy use, -27% in CO2 emission, -16%
in water consumption, -27% in waste production and -54% in VOCemission (revenue-based ﬁgures 2006-2013, based on 2006 levels,
Airbus Group legal entities scope of reporting).
The Airbus Group Energy Management Network has put greatemphasis on harmonising processes across Airbus Group, in
addition to speciﬁc energy-saving projects such as wood boilers
in France, and combined heat and power units in Germany.

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1.1 Presentation of the GroupThe future headquarters of Airbus Group is expected to meet themost modern environmental standards set by the Building Research
Establishment Environmental Assessment Method (BREEAM), a
global reference for sustainable construction. The buildings will beheated and air-conditioned by geothermal systems.

to manage the end of life of these aircraft in a sustainable way.
With the TARMAC AEROSAVE platforms, Airbus and its partners
have established 2 dedicated centres in France and Spain, whereaircraft are decommissioned, dismantled and recycled in safe andenvironmentally responsible conditions.

Actions promoting eco-efficient industrial processes, as forexample Additive Layer Manufacturing (ALM), also known as 3D
printing contribute to the reduction of the Group environmental
footprint. ALM revolutionises production by drastically reducing
waste in the manufacturing process, going from up to 95% withtraditional means down to only 5% with ALM, allowing for signiﬁcanttime and cost savings.

In order to increase the recovery rate of materials at the end oflife, Airbus is also leading a material recovery research projectin collaboration with specialised companies involved in carbon
ﬁber recycling.

Other examples to reduce industrial environmental footprint
are initiatives in place in all Divisions to reduce waste. Since thebeginning of 2014 a new Waste Management Concept has beenrolled out over the whole Airbus Defence and Space Ulm plant.
In 2014 an overall recycling rate of 95% for hazardous and nonhazardous waste was achieved there.

Anticipating the Products End of Life
More than 12,000 aircraft are due to retire from operation within
the next 20 years. Airbus is acting proactively to address the need

Airbus Defence and Space is contributing in many ways to thespace debris issue, developing mitigation measures (e.g. postmission disposal capabilities for launchers and satellites, tools andtraining to support collision avoidance manoeuvres, and studies
for the ESA’s Space Situational Awareness programme) as wellas improvement measures (e.g. several concepts for space debris
removal).
The MBDA joint venture in which Airbus Group owns 37.5% is
proposing dismantling capabilities and expertise to manage theend of life of pyrotechnical products in a safe and sustainable way,
supporting sales campaign and responding to the customers’
increasing demand for end-of-life management solutions.

1.1.11 Employees
As of 31 December 2014, the Group workforce amounted to138,622 employees (compared to 138,404 employees in 2013
restated to reﬂect the application of IFRS 10 and 11), 96.6% of
which consisted of full time employees. These statistics take
into account consolidation effects and perimeter changes at
year-end 2013. Depending on country and hierarchy level, theaverage working time is between 35 and 40 hours per week.
In 2014, 5,211 employees worldwide were welcomed into theGroup (compared to 8,823 in 2013 and 11,080 in 2012). At the sametime, 4,478 employees left the Group including partial retirements(compared to 4,160 in 2013 and 4,042 in 2012).

In terms of nationalities, 38.0% of the Company’s employees arefrom France, 33.9% from Germany, 9.5% from the UK and 8.8%
are from Spain. US nationals account for 1.6% of employees. The
remaining 8.4% are employees coming from a total of 135 othercountries. In total, 92.1% of the Group’s active workforce is locatedin Europe on more than 100 sites.

Workforce by Division and Geographic Area
The tables below provide a breakdown of Group employees by
Division and geographic area, including the percentage of parttime employees. Employees of companies accounted for by the
proportionate method (such as ATR, MBDA) in 2012 and 2013 areincluded in the tables on the same proportionate basis and havenot been adjusted for the application of IFRS 10 and 11.

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31 December 201431 December 2013(1)31 December 2012(1)Airbus73,95878,86273,500Airbus Helicopters

22,93923,374

22,435

Airbus Defence and Space

38,637---

17,255

17,038-21,22921,573

2,989

2,951

2,904

Employees by Division

Astrium
CassidianHeadquarters
Other Businesses

99

390

2,955

138,622

144,061

140,405

31 December 201431 December 2013(1)31 December 2012(1)Group Total

Employees by geographic area
France51,74054,51052,147

Germany

48,37450,08049,442

Spain

12,449

11,217

11,021UK

12,783

14,626

14,894

US

2,991

3,254

3,245

Other Countries

10,285

9,771

9,193

Group Total

138,662

144,061

140,405

31 December 201431 December 2013(1)31 December 2012(1)France

4.1%

4.0%

4.1%

Germany

4.5%

4.3%

4.0%

Spain

1.0%

0.7%

0.8%

UK

1.8%

2.1%

2.1%

US

1.6%

0.6%

0.5%

% Part time employees

Other Countries

0.8%

2.2%

2.4%

Group Total

3.4%

3.5%

3.4%

(1) 2012 and 2013 figures have not been ajusted for IFRS 10 and IFRS 11.

1.1.12 Incorporation by Reference
The English versions of the following documents shall be deemed
to be incorporated in and form part of this Registration Document:
the Consolidated Financial Statements (IFRS) and the Company
Financial Statements of the Company for the year ended
31 December 2012, together with the related notes, appendicesand Auditors’ reports, as incorporated by reference in theRegistration Document ﬁled in English with, and approved by,
the AFM on 3 April 2013 and ﬁled in English with the Chamberof Commerce of The Hague;■
the Consolidated Financial Statements (IFRS) and the Company
Financial Statements of the Company for the year ended
31 December 2013, together with the related notes, appendicesand Auditors’ reports, as incorporated by reference in theRegistration Document ﬁled in English with, and approved by,
the AFM on 4 April 2014 and ﬁled in English with the Chamberof Commerce of The Hague;
■

52

■

the Consolidated Financial Statements (IFRS) and the Company
Financial Statements of the Company for the year ended
31 December 2014, together with the related notes, appendicesand Auditors’ reports.

Copies of the above-mentioned documents are available freeof charge upon request in English at the registered ofﬁ ce of
the Company and in English, French, German and Spanish on
www.airbusgroup.com (Investors & Shareholders > Publications> Annual Reports and Registration Documents).
Copies of the above-mentioned Registration Documents are alsoavailable in English on the website of the AFM on www.afm.nl(Professionals > Registers > Approved prospectuses). The abovementioned ﬁnancial statements are also available in English forinspection at the Chamber of Commerce of The Hague.

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1

Information on the Group’s Activities
1.2 Recent Developments

1.2 Recent Developments
On 18 December 2014, Rheinmetall AG and Airbus Defence andSpace have agreed on the conditions of the transfer of the A400M
Loadmaster Control Contract from Rheinmetall to Cassidian
Airborne Solutions GmbH (CAS). This non material transaction
involves the termination of the service level agreement between
the two companies and allows settling the claims between thecompanies in relation to the A400M application software contract.
The agreements relative to this acquisition have become effective
on 1 January 2015. The overall purchase price of € 58.9 million
was paid on 2 January 2015.
In January 2015, Airbus Group and Safran completed the initial
phase of the integration of their respective space launcher
businesses. The Airbus Safran Launchers Joint Venture has
now entered its operational phase and will focus primarily on thedevelopment of the new Ariane 6 launcher and the continuation of
production of Ariane 5 launchers. In the second phase, all remaining
activities and industrial assets of Airbus Group and Safran dealing
with civil space launchers and military launchers will be integrated
into the Joint Venture. Given the relative size of the businesses
to be contributed by Airbus Group and Safran respectively, an
economic compensation of € 800 million will be made by Safranto Airbus Group in order to attain the 50/50 shareholding in the
Joint Venture in the second phase. Key terms and conditions of theimplementation of the second phase, including usual adjustments
notably regarding working capital positions and the nature andtiming of the compensation, are still to be ﬁnalised between theparties. The implied multiple for the activities contributed to the JV
by Airbus Defence and Space is 12x 2014 EBITA (Earnings before
interest, taxes and amortisation of intangibles).

On 10 March 2015, Airbus Defence and Space delivered the ﬁrst
of four Airbus A400M military transport ordered by the Royal
Malaysian Air Force. The handover also marks the ﬁrst deliveryof an A400M to an export customer outside the original launchcustomers.
On 25 March 2015, Airbus Group completed the sale of approximately
1.61 million shares in Dassault Aviation, corresponding to around17.5 percent of the company’s share capital for a total amount ofaround € 1.64 billion. The sale price determined in the bookbuilt
offering to institutional investors was € 1,030 per share and thesale price to Dassault Aviation € 980 per share (together the“Placement”), with settlement having occured on 30 March 2015.
The ﬁnal number of Dassault Aviation shares sold in Placement rose
to approximately 1.73 million shares or 18.75% of share capital,
following exercise of the over-allotment option granted by Airbus
Group to the joint bookrunners in respect of around 0.12 million
shares in Dassault Aviation, thereby increasing the total size of thePlacement to approximately € 1.76 billion. Settlement and deliveryof the over-allotment shares took place on 14 April 2015.
In accordance with the initial agreement signed on 28 November
2014, Dassault Aviation purchased approximately 0.46 million
shares in the Placement (representing around 26.7 percent of thePlacement and 5 percent of Dassault Aviation’s share capital), ata price of € 980 per share.
Upon completion of the Placement, Airbus Group holds around23.36 percent of Dassault Aviation’s share capital and associatedvoting rights.

On 21 January 2015, Airbus Group and Parter Capital GroupAG signed a ﬁnal share purchase agreement to transfer 100% of
the shares of Cassidian Belgium N.V. for a total consideration of€ 3.1 million.

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2Management’s Discussion
and Analysis of Financial Condition
and Results of Operations
2.1 Operating and Financial Review

56

2.1.1 Overview

57

2.1.2 Critical Accounting Considerations, Policies and Estimates

58

2.1.3 Performance Measures

63

2.1.4 Results of Operations

67

2.1.5 Changes in Consolidated Total Equity (Including Non-Controlling Interests)

71

2.1.6 Liquidity and Capital Resources72

2.1.7 Hedging Activities

79

2.2 Financial Statements

80

2.3 Statutory Auditors’ Fees81

2.4 Information Regarding the Statutory Auditors

81

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1 Operating and Financial Review
The following discussion and analysis is derived from and should be read together
with the audited Consolidated Financial Statements (IFRS) of the Group as ofand for the years ended 31 December 2014, 2013 and 2012 incorporated byreference herein. These ﬁnancial statements have been prepared in accordancewith International Financial Reporting Standards (“IFRS”) issued by theInternational Accounting Standards Board as endorsed by the European Union,
and with Part 9 of Book 2 of the Dutch Civil Code.
The following discussion and analysis also contains certain “non-GAAP ﬁnancial
measures”, i.e., ﬁnancial measures that either exclude or include amounts that are
not excluded or included in the most directly comparable measure calculated andpresented in accordance with IFRS. Speciﬁcally, the Group makes use of the nonGAAP measures “EBIT*”, “net cash” and “free cash ﬂow”.
The Group uses these non-GAAP ﬁnancial measures to assess its consolidated
ﬁnancial and operating performance and believes they are helpful in identifying
trends in its performance. These measures enhance management’s ability tomake decisions with respect to resource allocation and whether the Group is
meeting established ﬁnancial goals.
Non-GAAP ﬁnancial measures have certain limitations as analytical tools, andshould not be considered in isolation or as substitutes for analysis of the Group’s
results as reported under IFRS. Because of these limitations, they should not be
considered substitutes for the relevant IFRS measures.

Reporting in Registration Document 2014
The Management’s Discussion and Analysis of Operational Results and Financial
Condition contained in Section 2 of this Registration Document is based on the
new Group segment structure as described in section 2.1.1.2. The 2013 ﬁnancial
information and the 2012 ﬁnancial information have been restated to provide
comparative information with respect to the new Group segment structure. In
addition, the 2013 ﬁnancial information has been adjusted for the application of
IFRS 10 and IFRS 11, the 2012 ﬁnancial information has not been adjusted and isreferred to as “historical”, i.e. “not adjusted”.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.1

Overview

With consolidated revenues of € 60.7 billion in 2014, the Group isEurope’s premier aerospace and defence company and one of thelargest aerospace and defence companies in the world. In termsof market share, the Group is among the top two manufacturersof commercial aircraft, civil helicopters, commercial space launchvehicles and missiles, and a leading supplier of military aircraft,

2.1.1.1

satellites and defence electronics. In 2014, it generated 82% of its
total revenues in the civil sector (compared to 81% (adjusted) in2013) and 18% in the defence sector (compared to 19% (adjusted)in 2013). As of 31 December 2014, the Group’s active headcountwas 138,622 employees.

2

Exchange Rate Information

The ﬁnancial information presented in this document is expressed in euros, US dollars or pounds sterling. The following table sets out,
for the periods indicated, certain information concerning the exchange rate between the euro and the US dollar and pound sterling,
calculated using the ofﬁcial European Central Bank ﬁxing rate:
AverageYear EndYear ended

€-US$

€-£

€-US$

€-£

31 December 2012

1.28480.81091.31940.816131 December 2013

1.32810.8493

1.37910.833731 December 2014

1.32850.8061

1.21410.77892.1.1.2

Reportable Business Segments

Reorganisation
Prior to 1 January 2014 the Group organised its businesses into
ﬁ ve reportable segments: Airbus Commercial, Airbus Military,
Eurocopter, Astrium and Cassidian. Airbus Commercial and Airbus
Military formed the Airbus Division, with internal subcontracting
between Airbus Commercial and Airbus Military being eliminatedin the consolidated ﬁgures of the Airbus Division.

and related services. The former reportable segments Astrium,
Cassidian and Airbus Military form the new reportable segment
Airbus Defence and Space.
“Other — HQ / Consolidation” comprises the Group’s
activities managed in the US, the holding function of the Group’s
Headquarters such as the newly acquired bank and other activities
not allocable to the reportable segments, combined together withconsolidation effects.

The former reportable segments Cassidian, Astrium and Airbus
Military form the new reportable segment Airbus Defence andSpace.

2.1.1.3

In 2014, the Group organised its businesses into the following
three reportable segments:

A380 programme. Based on an updated technical solution
concept to ﬁx permanently the retroﬁt of the A380 wing rib issue,
additional amounts of € 251 million and € 85 million were recognisedin 2012 and 2013, respectively. The retroﬁt will be ﬁnalised in 2015.
In 2014, Airbus provided for costs related to in service technicalissues identiﬁed and with solutions deﬁned, which reﬂect the latest
facts and circumstances. Airbus is contractually liable for the repair
or replacement of the defective parts but not for any other damages
whether direct, indirect, incidental or consequential (including lossof revenue, proﬁt or use). However, in view of overall commercial
relationships, contract adjustments may occur, and be consideredon a case by case basis.

Airbus (before 1 January 2014: Airbus Commercial): development,
manufacturing, marketing and sale of commercial jet aircraft ofmore than 100 seats; aircraft conversion and related services;development, manufacturing, marketing and sale of regional
turboprop aircraft and aircraft components;■
Airbus Helicopters (before 1 January 2014: Eurocopter):development, manufacturing, marketing and sale of civil andmilitary helicopters; provision of helicopter-related services; and■Airbus Defence and Space: Military combat aircraft and training
aircraft; provision of defence electronics and of global security
market solutions such as integrated systems for global bordersecurity and secure communications solutions and logistics;
training, testing, engineering and other related services;development, manufacturing, marketing and sale of missiles
systems; development, manufacturing, marketing and sale ofsatellites, orbital infrastructures and launchers; provision of space
related services; development, manufacturing, marketing andsale of military transport aircraft and special mission aircraft■

Signiﬁcant Programme Developments,
Restructuring and Related Financial
Consequences in 2012, 2013 and 2014

Furthermore, Airbus continued to improve gross margin per aircraftin the year. Airbus delivered 30 A380 aircraft in 2014 and theprogramme is on track towards P&L breakeven in 2015.
A350 XWB programme. A programme review in 2012 indicateda three month slippage for entry-into-service – to the second halfof 2014 – in respect of which the Group recorded a charge of€ -124 million.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

In 2013, the A350 XWB programme made progress towards
certiﬁcation. On 14 June 2013, the ﬁrst A350 XWB “MSN1” took to
the skies on its ﬁrst ﬂight and the ﬂight test campaign accumulated
more than 1,000 ﬂight test hours. A net charge of € 434 million
reﬂ ected a re-assessment of actual and estimated unit cost.
Improvement actions were launched to converge on cost targets.

After eight aircraft deliveries in 2014 – four to France, two to Turkey
and one each to Germany and to the UK –, the A400M programme
is in a phase of progressive enhancement of military capabilities
with delays incurred. The sequence of progressive enhancements
and associated deliveries are under negotiation with the customers
to reﬂect revised programme baseline and delivery schedule.

In 2014, A350 XWB received Type Certiﬁcation and entry-intoservice occurred at the end of 2014, with the ﬁrst A350 XWB
being delivered to Qatar Airways on 22 December in line withcommitments. Despite this important achievement, signiﬁcantchallenges remain. The industrial ramp up preparation is underway
and associated risks will continue to be closely monitored in linewith the schedule, aircraft performance and overall cost envelope,as per customer’s commitment.

In the last quarter of 2014, management has reviewed theprogramme evolution mostly driven by military functionality
challenges and industrial ramp-up together with associatedmitigation actions. As a result of this review, Airbus Defence
and Space has recorded based on management best estimate
an additional net charge of € 551 million for the period ended
31 December 2014.

Construction contract accounting is applied for launch customer
contracts in the civil aircraft business if customers have signiﬁcantly
inﬂuenced the structural design and technology of the aircraft
type under the contract. Considering certain airline customers’
increasing involvement in the development and production processof the A350 XWB programme, Airbus applies IAS 11 construction
contract accounting to a ﬁxed number of launch customer contractsof the A350 XWB programme for existing backlog. This changein accounting policy has no material effect on 2014 Airbus Group
Financial Statements and is thus applied prospectively.
A400M programme. On 5 November 2010, the Group, OCCAR
and the launch nations concluded their negotiations on various
aspects of a new programme approach for the A400M, with anamendment to the A400M programme contract subsequently
finalised on 7 April 2011. Technical progress on the A400M
programme resulted in the recognition of A400M-related revenuesof € 0.5 billion in 2012, € 1.0 billion in 2013 and € 1.6 billion in 2014.
In 2013, the A400M programme achieved civil and militarycertiﬁcation. The initial two A400Ms were delivered to the French Air
Force while the third aircraft, for Turkey, was awaiting acceptancein the delivery centre at the end of 2013.

The A400M programme remains in a critical phase and associatedrisks will continue to be closely monitored.
Restructuring provisions. In 2013, a provision of € 292 million
was booked relating to the restructuring of the Airbus Defence
and Space Division and Headquarters. In 2014 the restructuring
programme remains on track with a reduction of 1,900 positions
at the end of the year.

2.1.1.4

Current Trends

Airbus is targeting slightly higher commercial aircraft deliveriesin 2015 than in 2014 and the commercial aircraft order book is
expected to grow.
Any major production or market disruption or economic downturn
could lead to a revision of these ﬁgures.

2.1.2

Critical Accounting Considerations, Policies and Estimates

2.1.2.1

Scope of and Changes in Consolidation

Acquisitions and disposals of interests in various businesses canaccount, in part, for differences in the Group’s results of operations
for one year as compared to another year. See “— Notes to theConsolidated Financial Statements (IFRS) — Note 4: Acquisitions
and disposals”.

Acquisitions
On 28 July 2014, Airbus Operations S.L.U., Getafe (Spain),acquired additional 58.49% shares in Alestis Aerospace S.L., La
Rinconada (Spain) for a total consideration of € 28 million including€ 6 million due to the separate recognition of settlements of preexisting relationships. This provides Airbus Group with a majority
shareholding of in total 60.16% in Alestis Aerospace S.L. Airbus’

58

The A400M SOC 1 milestone remains to be achieved. SOC 1 fell
due end October 2013, and the termination right related thereto
became exercisable by OCCAR/Nations on 1 November 2014
after a 12-month grace period. It has not at the date hereof been
exercised. Management judges that it is highly unlikely that thistermination right will be exercised.

investment is intended to secure the supply chain for civil andmilitary programmes. Alestis Aerospace S.L. reported revenuesof € 148 million for the full year 2014.
On 25 July 2014, Airbus Group N.V., Leiden (Netherlands)
acquired 100% of the shares in Salzburg München Bank AG fromRaiffeisenverband Salzburg. The Salzburg München Bank AG
is a fully-licensed bank based in Munich (Germany) with around€ 300 million of total assets serving small and medium enterprises
and private clients. The acquisition of Salzburg München Bank
aims to provide additional financing options for the Group’sbusinesses. Between the acquisition date and year-end 2014,
Salzburg München Bank AG reported revenues of € 4.7 million.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

On 17 May 2013, Cassidian Cybersecurity SAS, Elancourt (France)
acquired a 83.9% controlling interest in Arkoon Network Security
SA, Lyon (France) (“Arkoon”), for a total consideration of € 14 million.
On 14 June 2013 Cassidian Cybersecurity SAS made a mandatory
simpliﬁed public offering on the remaining shares of Arkoon in linewith General Regulations of the French Financial Market Authority(“AMF”). The subsequent tender offer and squeeze-out procedureof remaining shareholders left Cassidian as the sole shareholder of
Arkoon on 15 July 2013. The total consideration for the remaining
16.1% of Arkoon was € 2.7 million. From the date of acquisition,
Arkoon contributed € 6 million to Group revenues in 2013.
On 20 November 2012, the Group acquired Eltra Holdings Pte Ltd.,Singapore (Singapore), an aerospace group involved in various
aerospace supply chain and MRO activities for a total considerationof € 28 million.
On 16 November 2012, Cassidian acquired 99.8% of Netasq,
Villeneuve-d’Ascq (France), a leading expert and pioneer in the IT
security market for a total consideration of € 27 million.
On 1 October 2012, Cassidian acquired 75.1% of the shares ofCarl Zeiss Optronics GmbH, Oberkochen (Germany), with theintention to run the optics and optronics activities of Carl Zeiss
Optronics GmbH together with Carl Zeiss AG for a total
consideration of € 121 million. Carl Zeiss Optronics GmbH is amanufacturer of optronic, optic and precision-engineered products
for military and civil applications.
On 1 July 2012, Cassidian acquired 51% of Rheinmetall Airborne
Systems GmbH, Bremen (Germany), for a total consideration of€ 85 million, to pursue Rheinmetall’s activities related to unmanned
aerial systems as well as cargo loading systems together with
Rheinmetall within a new entity.
On 3 April 2012, Astrium acquired 66.8% of Space Engineering
SpA, Rome (Italy), a specialist in digital telecommunications, RF
and antenna equipment engineering for both space and groundbased applications for a total consideration of € 10 million.
In the ﬁrst half year 2012, Airbus Helicopters expanded the MRO
engine business of its subsidiary Vector Aerospace Corp., Toronto(Canada), via several asset deals, primarily in the Asia-Paciﬁ cregion, for a total consideration of € 43 million.

Disposals
On 9 December 2014, Airbus Group signed a share purchaseagreement with the State of Finland to sell its entire 26.8% sharein Patria Oyj to the Finnish defence, security and aviation services
provider for a total consideration of € 133 million. The transaction
was closed on 11 December 2014 and the Group recognized a€ 47 million capital gain within share of proﬁt from investments.
On 27 November 2014, Airbus Group in an off-market block tradesold to Dassault Aviation a total of 810,072 Dassault Aviation
shares at a price of € 980 per share representing a total amountof € 794 million pre transaction costs. The gain recognized inshare of proﬁt from investments amounted to € 343 million. After

this transaction, Airbus Group held 38.82% of Dassault Aviation’sshare capital and associated voting rights and then following
the cancellation by Dassault Aviation of 9% of its shares, as of
31 December 2014, Airbus Group holds 42.11% with associatedvoting rights, corresponding to 3,880,235 shares.
On 10 July 2014, Airbus Defence and Space sold its Test & Services
activities to a consortium consisting of ACE Management S.A.,
Paris (France) and IRDI S.A., Toulouse (France). The disposal was
performed via an acquisition company Test & Mesures Groupe
SAS in which Airbus Defence and Space will retain temporarily
33.5%. The total consideration received amounted to € 35 million(thereof € 28 million consideration received in cash and € 7 million
for the shares in Test & Mesures Groupe SAS). The amount of net
assets sold was € 31 million. The Group recognised a € 7 million
capital gain on the sale of the Test and Services activities reported
in Other income.

2

On 7 March 2014, Astrium Services GmbH, Ottobrunn (Germany)
disposed of 100% of the shares of ND Satcom GmbH, Immenstaad(Germany) to Quantum Industries S.à.r.l., Luxembourg (Luxembourg)with economic effect as of 1 March 2014 leading to a negative
consideration of € 9 million.
On 28 February 2014, EADS North America, Inc., Herndon (VA,
USA) sold 100% of the assets and liabilities of its Test and Services
division to Astronics Corp., East Aurora (NY, USA), for a total
consideration of € 51 million.
On 31 January 2013, ST Aerospace Ltd., Singapore (Singapore)acquired a 35% non-controlling interest in Elbe Flugzeugwerke,
Dresden (Germany) (EFW) by increase in capital of € 2.5 million in
EFW. The Group, as the former sole shareholder, retains 65% of
the shares of EFW.

Disposal groups classified as held for saleAirbus Safran Launcher Joint Venture
On 16 June 2014, Airbus Group and Safran announced the intention
to create a 50/50 joint-venture consolidating their respective
launcher and propulsion system activities in France and Germany.
On 3 December 2014, the joint venture Airbus Safran Launchers has
been created after the approval of the development and productionof a new Ariane 6 launcher at the ESA Ministerial Conference. The
partners decided to structure the operation in two phases with theﬁrst phase consisting in the joint venture entity taking responsibility
and gathering resources to coordinate programme management ofcivil activities of the launcher business and also carrying relevant
participation. In a second phase all assets, contracts and industrial
capabilities shall be contributed enabling the joint venture to carryout all activities relating to the design, development, manufacturing
and selling of launchers, propulsion systems, satellite and spacevehicle propulsion for civil and military applications and the sellingand commercialisation of civil launch services. Implementation of
the second phase is subject to the joint venture entering into adevelopment contract for Ariane 6.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

After approval of the ESA Ministerial Conference implementationof ﬁrst phase was conﬁrmed and associated assets and liabilities
have been classiﬁed as held for sale as at 31 December 2014.

quarter of each ﬁnancial year, whether or not there is any indicationof impairment. An impairment loss is recognised in the amount bywhich the asset’s carrying amount exceeds its recoverable amount.

On 14 January 2015, Airbus Group and Safran have completed
the ﬁrst phase of the integration process enabling Airbus Safran
Launchers to become operational.

Generally, the discounted cash ﬂow method is used to determine
the value in use of the assets. The discounted cash ﬂow method isparticularly sensitive to the selected discount rates and estimatesof future cash ﬂows by Management. Consequently, slight changes
to these elements can materially affect the resulting asset valuationand therefore the amount of the potential impairment charge.

Electronics Oostkamp
On 23 December 2014, Airbus Group signed an agreementwith Parter Capital Group AG for the sale of Airbus Defence andSpace’s Electronics Oostkamp facility in Belgium. Airbus Grouphas recognized an associated loss of € 7 million in other expenses
in 2014. The transaction was closed on 21 January 2015.

Transactions with Non-Controlling Shareholders
On 31 May 2013, Astrium Services GmbH, Ottobrunn (Germany)acquired remaining non-controlling interest of 24.9% in ND
Satcom GmbH, Immenstaad (Germany) from SES S.A., Betzdorf(Luxemburg). The amount of the total consideration was € 1.
On 28 May 2012, Cassidian reduced its shareholding of 87.4% in
Grintek Ewation (Pty) Ltd., Pretoria, South Africa, to 75% to comply
with local black economic empowerment (BEE) requirements for€ 7 million.

2.1.2.2

Fair Value Adjustments

The merger of the operations of Aerospatiale Matra, Daimler
Aerospace AG and Construcciones Aeronáuticas S.A., leading to
the creation of the Group in 2000, was recorded using the purchasemethod of accounting with Aerospatiale Matra as the acquirer.
Accordingly, the book value of certain assets and liabilities, mainly
property, plant and equipment and inventories, was adjusted byan aggregate amount of € 1.8 billion, net of income taxes, toallocate a portion of the respective fair market values of Daimler
Aerospace AG and Construcciones Aeronáuticas S.A. at the timeof the merger (the “fair value adjustments”). These aggregate
additions in value are generally being depreciated over four to
25 years for ﬁxed assets and were amortised over approximately
24 months for inventories. In addition, in 2001 in connection withthe formation of Airbus S.A.S., the Group adjusted the book valueof Airbus ﬁxed assets and inventories by an aggregate amount of€ 0.3 billion, net of income taxes, to reﬂect their fair market values.
The fair value adjustments lead to a depreciation expense that isrecorded in cost of sales in the consolidated income statement.
For management reporting purposes, the Group treats these
depreciation charges as non-recurring items in EBIT pre-goodwill
impairment and exceptionals. See “— 2.1.3.3 Use of EBIT*”.

2.1.2.3

Impairment / Write-down of Assets

When a triggering event such as an adverse material market eventor a signiﬁcant change in forecasts or assumptions occurs, theGroup performs an impairment test on the assets, group of assets,
subsidiaries, joint ventures or associates likely to be affected. In
addition, the Group tests goodwill for impairment in the fourth60

The discount rates used by the Group are derived from theweighted average cost of capital of the businesses concerned.
See “— Notes to the Consolidated Financial Statements(IFRS) — Note 2: Summary of signiﬁ cant accounting policies— Signiﬁcant Accounting Policies — Impairment of non-ﬁnancial
assets” and “— Note 13: Intangible assets”.
An impairment of goodwill has an effect on proﬁ tability, as itis recorded in the line item “Other expenses” on the Group’s
consolidated income statement. No goodwill was impaired in 2014.
In 2012 and 2013, the annual goodwill impairment tests within
Other Businesses resulted in an impairment charge of € 17 millionand € 15 million, respectively.

2.1.2.4

Capitalised Development Costs

Pursuant to the application of IAS 38 “Intangible Assets”, the Groupassesses whether product-related development costs qualify forcapitalisation as internally generated intangible assets. Criteria for
capitalisation are strictly applied. All research and development
costs not meeting the IAS 38 criteria are expensed as incurredin the consolidated income statement. € 488 million (historical) of
product-related development costs were capitalised in accordancewith IAS 38 in 2012, € 417 million (adjusted) in 2013 and € 225 million
in 2014. The ﬁgures related mostly to the A350 XWB programme(€ 366 million in 2012, € 354 million in 2013 and € 58 million in2014) and to the H160 helicopter programme development costs(€ 18 million in 2012, € 36 million in 2013 and € 47 million in 2014).
Capitalised development costs are generally amortised overthe estimated number of units produced. If the number of units
produced cannot be estimated reliably, capitalised development
costs are amortised over the estimated useful life of the internallygenerated intangible asset. Amortisation of capitalised development
costs (and impairments, if any) is mainly recognised within “Cost of
sales”. Amortisation of capitalised development costs amounted
to € 171 million in 2012 (historical), € 106 million (adjusted) in 2013and € 137 million in 2014, the latter relating among others to theA380 programme and the FSTA programme.
Internally generated intangible assets are reviewed for impairment
annually when the asset is not yet in use and subsequently
whenever events or changes in circumstances indicate that thecarrying amount may not be recoverable. See “— Notes to theConsolidated Financial Statements (IFRS) — Note 2: Summary ofsigniﬁcant accounting policies — Signiﬁcant accounting policies— Research and development expenses”.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.2.5

Accounting for Hedged Foreign Exchange
Transactions in the Financial Statements

More than 70% of the Group’s revenues are denominatedin US dollars, whereas a major portion of its costs is incurredin euros and, to a smaller extent, in pounds sterling. The Group
uses hedging strategies to manage and minimise the impact of
exchange rate ﬂuctuations on its proﬁts. See “— 2.1.7.1 Foreign
Exchange Rates” and “Risk Factors — 1. Financial Market Risks— Foreign Currency Exposure”.
Cash ﬂow hedges. The Group generally applies cash ﬂow hedge
accounting to foreign currency derivative contracts that hedge theforeign currency risk on future sales, to certain interest rate swaps
that hedge the variability of cash ﬂows attributable to recognised
assets and liabilities and to equity swaps that hedge the equity pricerisk inherent in cash-settled share based payments (LTIP). Changes
in fair value of the hedging instruments related to the effective partof the hedge are reported in accumulated other comprehensive
income (“AOCI”) — a separate component of total consolidated
equity, net of applicable income taxes — and recognised in the
consolidated income statement in conjunction with the result of
the underlying hedged transaction, when realised. See “— 2.1.5
Changes in Consolidated Total Equity (including Non-controlling
Interests)”. The ineffective portion is immediately recorded in “Proﬁt
for the period”. Amounts accumulated in equity are recognised in
proﬁt or loss in the periods when the hedged transaction affects
the income statement, such as when the forecast sale occurs or
when the ﬁnance income or ﬁnance expense is recognised in theincome statement. If hedged transactions are cancelled, gains andlosses on the hedging instrument that were previously recordedin equity are generally recognised in “Proﬁt for the period”. If thehedging instrument expires or is sold, terminated or exercised,or if its designation as hedging instrument is revoked, amounts
previously recognised in equity remain in equity until the forecasted
transaction or ﬁ rm commitment occurs. Apart from derivativeﬁ nancial instruments, the Group may also use non-derivative
ﬁnancial assets or liabilities denominated in a foreign currency
to hedge foreign currency risk inherent in forecast transactions.
See “— 2.1.7.1 Foreign Exchange Rates”.
Revenues in currencies other than the euro that are not hedged
through ﬁnancial instruments are translated into euro at the spot
exchange rate at the date the underlying transaction occurs.
“Natural” hedges. The Group uses certain foreign currency
derivatives to mitigate its foreign currency exposure arising fromchanges in the fair value of recognised assets and liabilities. To
reﬂect the largely natural offset those derivatives provide to theremeasurement gains or losses of speciﬁc foreign currency balance
sheet items, the Group presents the gains or losses of those foreignexchange rate derivatives as well as the fair value changes of
the relating recognised assets and liabilities in EBIT* (rather thanpresenting the gains or losses of those foreign exchange rate
derivatives in “other ﬁnancial result” but the fair value changesof the relating recognised assets and liabilities in EBIT*) insofar
as certain formal requirements are met, with no impact on net

income. See “— Notes to the Consolidated Financial Statements(IFRS) — Note 2: Summary of signiﬁcant accounting policies —Signiﬁcant Accounting Policies — Derivative ﬁnancial instruments”
and “— Note 11: Total ﬁnance costs — Other ﬁnancial result”.

2.1.2.6

Foreign Currency Translation

The Group’s Consolidated Financial Statements are presented
in euros. A legal entity’s functional currency is the currency of the
primary economic environment in which the entity operates. The
assets and liabilities of foreign entities, whose functional currency
is other than euro, are translated using period-end exchange rates,
while the corresponding income statements are translated using
average exchange rates during the period. All resulting translationdifferences are included as a component of AOCI.

2

Transactions in currencies other than the functional currency
are translated into the functional currency at the exchange rate
prevailing on the transaction date. Monetary assets and liabilities
denominated in foreign currencies at period-end are translated
into the functional currency using the period-end exchange rate.
These foreign exchange gains and losses arising from translation
are recognised in the consolidated income statement except whendeferred in equity as qualifying cash ﬂow hedges.
Non-monetary assets and liabilities denominated in foreign
currencies, which are stated at historical cost, are translated intofunctional currency at the exchange rate in effect on the date of
the transaction. Translation differences on non-monetary ﬁnancial
assets and liabilities that are measured at fair value are reported aspart of the fair value gain or loss. However, translation differences of
non-monetary ﬁnancial assets measured at fair value and classiﬁed
as available for sale are included in AOCI.
Goodwill and fair value adjustments arising on the acquisition of
a foreign entity that was acquired after 31 December 2004 aretreated as assets and liabilities of the acquired company and aretranslated into euro at the period-end exchange rate. Regardingtransactions prior to that date, goodwill, assets and liabilities
acquired are treated as those of the acquirer.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 2: Summary of signiﬁcant accounting policies — Signiﬁcantaccounting policies — Foreign currency translation”.

Currency Translation Mismatch
Customer advances (and the corresponding revenues recorded
when sales recognition occurs) are translated at the exchange rate
prevailing on the date they are received. US dollar-denominatedcosts are converted at the exchange rate prevailing on the date they
are incurred. To the extent that US dollar-denominated customer
advances differ, in terms of timing of receipt or amount, fromcorresponding US dollar-denominated costs, there is a foreign
currency exchange impact (mismatch) on EBIT*. Additionally, themagnitude of any such difference, and the corresponding impact
on EBIT*, is sensitive to variations in the number of deliveries.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.2.7

Accounting for Sales Financing Transactions in the Financial Statements

In order to support product sales, primarily at Airbus and Airbus
Helicopters, the Group may agree to participate in the ﬁnancingof customers, on a case-by-case basis, directly or throughguarantees provided to third parties. Certain sales contracts
may include the obligation of an asset value guarantee, whereby
Airbus or Airbus Helicopters guarantee a portion of the valueof an aircraft at a speciﬁc date after its delivery. See “— 2.1.6.4
Sales Financing” and “Notes to the Consolidated Financial
Statements (IFRS) — Note 33: Commitments and contingencies”.
The accounting treatment of sales ﬁnancing transactions varies
based on the nature of the ﬁnancing transaction and the resulting
exposure.
On balance sheet. When, pursuant to a ﬁnancing transaction,
substantially all the risks and rewards of ownership of the ﬁnanced
aircraft reside with the customer, the transaction is characterised
as either a loan or a ﬁnance lease. In such instances, revenues fromthe sale of the aircraft are recorded upon delivery, while ﬁnancial
interest is recorded over time as ﬁnancial income. The outstandingbalance of principal is recorded on the statement of ﬁ nancial
position (on balance sheet) in long-term ﬁnancial assets, net ofany accumulated impairments. See “— Notes to the Consolidated
Financial Statements (IFRS) — Note 17: Other investments andother long-term ﬁnancial assets”.
Group-external investors sometimes share in the ﬁnancing andif so, the transactions usually involve the creation of a Structured
Entity (“SE”). Airbus Group consolidates an aircraft ﬁnancing SE
if it is exposed to the SE’s variable returns and has the ability todirect the relevant remarketing activities. Otherwise, it recognises
its share in the SE ﬁnancing as a loan from aircraft ﬁnancing under
Other long-term ﬁnancial assets. At 31 December 2014 the carrying
amount of its loans from aircraft ﬁnancing amounts to € 426 million.
This amount also represents the Group’s maximum exposure toloss from its interest in unconsolidated aircraft ﬁ nancing SEs.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 33: Commitments and Contingencies”.
By contrast, when substantially all the risks and rewards ofownership remain with the Group, the transaction is characterised
as an operating lease. The Group’s general policy is to avoid,
whenever possible, operating leases for new aircraft to bedelivered to customers. Rather than recording 100% of therevenues from the “sale” of the aircraft at the time of delivery,
rental income from such operating leases is recorded in revenues
over the term of the respective leases. The leased aircraft arerecorded at production cost on the statement of ﬁnancial position(on balance sheet) as property, plant and equipment, and thecorresponding depreciation and potential impairment charges
are recorded in cost of sales. See “— Notes to the Consolidated
Financial Statements (IFRS) — Note 14: Property, plant andequipment”.
If the present value of an asset value guarantee exceeds 10% of
the sales price of the aircraft, the sale of the underlying aircraft isaccounted for as an operating lease in the Consolidated Financial

62

Statements. In this case, upon aircraft delivery, the cash payment
received from the customer is recognised on the consolidated
statement of ﬁnancial position as deferred income and amortised
straight-line up to the amount, and up to the last exercise date, of
the asset value guarantee. The production cost of the aircraft isrecorded on the statement of ﬁnancial position as property, plantand equipment. Depreciation expenses are recorded in cost of
sales in the consolidated income statement. As of December 2014
and 2013 respectively no such transaction has been recorded on
the balance sheet.
Off balance sheet — contingent commitments. Certain sales
ﬁnancing commitments, such as lease in / lease out structures
and asset value guarantees the present value of which is below
the 10% threshold, are not recorded on the statement of ﬁnancial
position (on balance sheet).
As a result, transactions relating to such asset value guarantees
are accounted for as sales, with the related exposure deemed
to be a contingent commitment. To reduce exposure underasset value guarantees and to minimise the likelihood of theiroccurrence, the Group extends them with prudent guaranteedasset values and restrictive exercise conditions, including limited
exercise window periods.
Under lease in / lease out structures, which Airbus appliedin the past to allow investors to take advantage of certain
jurisdictions’ leasing-related tax benefits, the risks and rewardsof ownership of the aircraft are typically borne by a third party,
usually referred to as the head lessor. The head lessor leases(directly or indirectly) the aircraft to Airbus, which in turn subleases it to the customer. To the extent possible, the terms of
the head lease and sub-lease match payment streams and otherfinancial conditions. Such commitments by Airbus are reported
as off-balance sheet contingent liabilities. See “— Notes to
the Consolidated Financial Statements (IFRS) — Note 33:
Commitments and contingencies”.
Provisions and allowances. Under its provisioning policy
for sales ﬁ nancing risk, the Group records provisions to fully
cover its estimated ﬁ nancing and asset value net exposure.
Provisions pertaining to sales ﬁ nancing exposure, whether onbalance sheet or off-balance sheet, are recorded as impairmentsof the related assets or in provisions. Provisions recorded asliabilities relate primarily to off-balance sheet commitments.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 25c: Other provisions”. Provisions are recorded as
impairments of the related assets when they can be directly
related to the corresponding asset. See “— Notes to theConsolidated Financial Statements (IFRS) — Note 14: Property,
plant and equipment” and “— Note 17: Other investments andother long-term ﬁ nancial assets”. While Management views its
estimates of valuations of collateral as conservative, changes
in provisions reﬂ ecting revised estimates may have a material
impact on net income in future periods.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.2.8

Provisions for Loss-Making Contracts

The Group records provisions for loss-making contracts when
it becomes probable that total contract costs will exceed total
contract revenues. Due to the size, length of time and nature ofmany of the Group’s contracts, the estimation of total revenues
and costs at completion is complicated and subject to many
assumptions, judgements and estimates. The introduction of
new aircraft programmes (such as the A350 XWB) or major
derivative aircraft programmes adds an additional element ofcomplexity to the assumptions, judgements and estimates
related to expected development, production and certiﬁcation
schedules and anticipated cost components, including possible
customer penalties and supplier claims. The Group’s contracts
may also include customer options to cancel or extend the contract

2.1.3

Performance Measures

2.1.3.1

New Segment Structure

under certain circumstances, requiring a judgment as to theprobability that these options will be exercised. See “— Notes
to the Consolidated Financial Statements (IFRS) — Note 2.5c:
Other Provisions”.
Loss-making contract provisions are therefore reviewed andreassessed regularly. However, future changes in the assumptions
used by the Group or a change in the underlying circumstances,such as the ﬂuctuation of certain foreign exchange rates, may leadto a revaluation of past loss-making contract provisions and havea corresponding positive or negative effect on the Group’s futureﬁnancial performance.

2

As mentioned in “— 2.1.1.2 Reportable Business Segments”, the former reportable segments Cassidian, Astrium and Airbus Military
form the new reportable segment Airbus Defence and Space as of 1 January 2014.

Airbus (before 1 January 2014: Airbus Commercial)
Set forth below is a summary of the measures for the activities of Airbus when regrouped into the structure of the new Division for the
past three years.

(in €m)Year ended
31 December 2014

Year ended
31 December 2013(1)Year ended
31 December 2012(2)Order Intake (net)150,085

199,261

87,283

Order Book

803,633

625,595

505,333

Revenues

42,28039,49437,624

EBIT*

2,671

1,593

1,147

in % of revenues

6.3%

4.0%

3.0%

(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.

Airbus Helicopters (before 1 January 2014: Eurocopter)
Set forth below is a summary of the measures for the activities of Airbus Helicopters for the past three years.

(in €m)Year ended
31 December 2014

Year ended
31 December 2013

Year ended
31 December 2012

Order Intake (net)

5,469

5,775

5,392

Order Book

12,227

12,42012,942

Revenues

6,524

6,297

6,264

EBIT*

413

397

309

in % of revenues

6.3%

6.3%

4.9%

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2.1 Operating and Financial Review

Airbus Defence and SpaceSet forth below is a summary of the measures for the activities of Airbus Military, Astrium and Cassidian when regrouped into thestructure of the new Division for the past three years.
Year ended
31 December 2014

Year ended
31 December 2013(1)Year ended
31 December 2012(2)Order Intake (net)12,225

11,80810,512

Order Book

43,075

43,20849,219

Revenues

13,025

13,121

13,520(in €m)

EBIT*

409

659

522

in % of revenues

3.1%

5.0%

3.9%

(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.

2.1.3.2

Order Backlog

Year-end order backlog 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
the Group receives a non-refundable down payment on a deﬁnitive
contract. Defence-related orders are included in the backlog uponsignature of the related procurement contract (and the receipt, inmost cases, of an advance payment). Commitments under defence“umbrella” or “framework” agreements by governmental customers
are not included in backlog until Airbus Group is ofﬁcially notiﬁed.

For commercial aircraft 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 forthe 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.

CONSOLIDATED BACKLOG FOR THE YEARS ENDED 31 DECEMBER 2014, 2013 AND 2012(1)Year ended 31 December 2014

Year ended 31 December 2013(2)Year ended 31 December 2012(3)Amount in €bn

In percentage(4)Amount in €bn

In percentage(4)Amount in €bn

In percentage(4)Airbus(5)

803.6

93.6%

625.6

91.8%

505.3

89.0%

Airbus Helicopters

12.2

1.4%

12.4

1.8%

13.0

2.3%

Airbus Defence and Space

43.1

5.0%

43.2

6.4%

49.2

8.7%

Total Divisional backlog

858.9

100%

681.2

100%

567.5

100%

Other – HQ / Consolidation

(1.4)

(0.6)

(1.0)

857.5

680.6

566.5

Total

(1) Without options.
(2) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(3) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.
(4) Before “Other — HQ / Consolidation”.
(5) Based on catalogue prices for commercial aircraft activities.

2014 compared to 2013. The € 176.9 billion increase in theorder backlog from 2013, to € 857.5 billion, primarily reﬂ ects
the Group’s strong order intake in 2014 (€ 166.4 billion), whichsigniﬁcantly exceeded the revenues accounted for in the same
year (€ 60.7 billion). Additionally, the stronger US dollar spot rateused for conversion of the non-hedged portion of the backlog
into euro at year end (€-US$ 1.21 as compared to €-US$ 1.38
at the end of 2013) had a positive impact on order backlog ofapproximately € +86 billion.
Airbus’ backlog increased by € 178 billion from 2013, to€ 803.6 billion, primarily reﬂ ecting a book-to-bill ratio of morethan two (calculated using units of new net orders). Order intake

64

consisted of 1,456 net orders in 2014 (as compared to 1,503 in2013), driven mainly by the A320 family, which received 1,321
net ﬁrm orders (1,011 A320neo and 310 A320ceo). Total orderbacklog at Airbus amounted to 6,386 aircraft at the end of 2014(as compared to 5,559 aircraft at the end of 2013).
Airbus Helicopters’ backlog decreased by € -0.2 billion from2013, to € 12.2 billion, reﬂecting a book-to-bill ratio of less than
one with new net orders of € 5.5 billion. Order intake consistedof 369 net orders in 2014 (as compared to 422 in 2013), driven
by orders for commercial helicopters. Total order backlog
amounted to 893 helicopters at the end of 2014 (as comparedto 995 helicopters at the end of 2013).

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

Airbus Defence and Space’s backlog decreased by € -0.1 billion
from 2013, to € 43.1 billion, reﬂecting a book-to-bill ratio of less than
one with new net orders of € 12.2 billion. Space Systems achieveda book-to-bill ratio above 1 with a major development contract inDefence, key export orders in Earth Observation, Navigation andScience and 4 telecommunications satellites (as compared to 3
in 2013). Furthermore, 28 net orders were booked in the Light &Medium segment (as compared to 10 in 2013). One order wasbooked for the A330 MRTT for a new customer, France (comparedto 7 aircraft in 2013).

2013 compared to 2012. The € 114.1 billion increase (adjusted) in
the order backlog from 2012, to € 680.6 billion (adjusted), primarily
reﬂects the Group’s strong order intake in 2013 (€ 216.4 billion(adjusted)), which signiﬁcantly exceeded the revenues accounted
for in the same year (€ 57.6 billion (adjusted)), although the weaker
US dollar spot rate used for conversion of the non-hedged portionof the backlog into euro at year end (€-US$ 1.38 as compared to€-US$ 1.32 at the end of 2012) had a negative impact on orderbacklog of approximately € -25 billion.

2

The table below illustrates the proportion of civil and defence backlog at the end of each of the past three years.
Year ended 31 December 2014

Year ended 31 December 2013

Year ended 31 December 2012

Amount in €bn(1)In percentage

Amount in €bn(1),(2)In percentage

Amount in €bn(1),(3)In percentage

Civil Sector

815.3

95%

638.0

94%

516.9

91%

Defence Sector

42.2

5%

42.6

6%

49.6

9%

857.5

100%

680.6

100%

566.5

100%

Backlog:

Total(1) Including “Other — HQ / Consolidation”.
(2) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.
(3) 2012 figures have not been adjusted for IFRS 10 and IFRS 11.

2.1.3.3

Use of EBIT*The Group uses EBIT pre-goodwill impairment and exceptionals (EBIT*) as a key indicator of its economic performance. The term
“exceptionals” refers to such items as depreciation expenses of fair value adjustments relating to the former EADS merger and theAirbus combination, as well as impairment charges thereon. It also comprises disposal impacts related to goodwill and fair value
adjustments from these transactions.
Set forth below is a table reconciling the Group’s proﬁt before ﬁnance costs and income taxes (as reﬂected in the Group’s consolidated
income statement) with the Group’s EBIT*.

(in €m)Profit before finance costs and income taxes

Year ended
31 December 2014

Year ended
31 December 2013(1)Year ended
31 December 2012(2)

3,991

2,570

2,089

Disposal and impairment of goodwill

6

15

17

Exceptional depreciation

43

39

38

4,040

2,624

2,144

EBIT*
(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.3.4

EBIT* Performance by Division

Set forth below is a breakdown of the Group’s consolidated EBIT* by Division for the past three years.

(in €m)Year ended
31 December 2014

Year ended
31 December 2013(1)Year ended
31 December 2012 (2)Airbus

2,671

1,593

1,147

Airbus Helicopters

413

397

309

Airbus Defence and Space

409

659

522

3,493

2,649

1,978

547

(25)

166

4,040

2,624

2,144

Total Divisional EBIT*

Other – HQ / Consolidation(3)Total(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.
(3) “Other — HQ / Consolidation” comprises results from headquarters, which mainly consist of the “share of profit from investments in associates” from Group’s investment in Dassault Aviation.

2014 compared to 2013. The Group’s consolidated EBIT*
increased by 54.0%, from € 2.6 billion (adjusted) for 2013 to€ 4.0 billion for 2014, primarily reﬂecting the increased EBIT* at
Airbus in 2014.
Airbus’ EBIT* increased by 67.7%, from € 1.6 billion for 2013 to€ 2.7 billion for 2014, mainly due to higher aircraft deliveries (629deliveries in 2014, as compared to 626 deliveries in 2013),continued
operational improvements including A380 progress towards
breakeven and a favourable evolution of maturing hedges, partially
offset by increased A350 XWB support costs. In Q4 2013 a
negative charge of € 434 million was recorded on the A350 XWB
programme contributing to the improvement seen in 2014. (See“— 2.1.1.3 Signiﬁcant Programme Developments, Restructuring
and Related Financial Consequences in 2012, 2013 and 2014”).
Airbus Helicopters’ EBIT* increased by 4.0%, from € 397 million
for 2013 to € 413 million for 2014, despite higher research anddevelopment expenses and a less favourable revenue mix.
Airbus Defence and Space’s EBIT* decreased by 37.9% from€ 659 million (adjusted) for 2013 to € 409 million for 2014. In the lastquarter of 2014, Management has reviewed the A400M programmeevolution mostly driven by military functionality challenges andindustrial ramp-up together with associated mitigation actions. As
a result of this review, Airbus Defence and Space has recorded
based on Management best estimate an additional net chargeof € 551 million for the period ended 31 December 2014. (See“— 2.1.1.3 Signiﬁcant Programme Developments, Restructuring
and Related Financial Consequences in 2012, 2013 and 2014”).
The EBIT* of Other – Headquarters/Consolidation increased from€ -25 million for 2013 to € +547 million for 2014. This includes acapital gain of € 343 million linked to the divestment of eight percentof the Company’s Dassault Aviation participation.
2013 compared to 2012. The Group’s consolidated EBIT*
increased by 22.4% (adjusted), from € 2.1 billion for 2012 to€ 2.6 billion (adjusted) for 2013, primarily reﬂecting the increased
EBIT* at the three divisions in 2013.

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Foreign currency impact on EBIT*. More than 70% of theGroup’s revenues are denominated in US dollars, whereas asubstantial portion of its costs is incurred in euros and, to a lesser
extent, pounds sterling. Given the long-term nature of its businesscycles (evidenced by its multi-year backlog), the Group hedges asigniﬁcant portion of its net foreign exchange exposure to mitigate
the impact of exchange rate ﬂuctuations on its EBIT*. See “— 2.1.7.1
Foreign Exchange Rates” and “Risk Factors – 1. Financial Market
Risks – Foreign Currency Exposure”. In addition to the impact that
Hedging Activities have on the Group’s EBIT*, the latter is also
affected by the impact of revaluation of certain assets and liabilities
at the closing rate and the impact of natural hedging.
During 2014, cash flow hedges covering approximately
US$ 24.3 billion of the Group’s US dollar-denominated revenues
matured. In 2014, the compounded exchange rate at which
hedged US dollar-denominated revenues were accounted
for was €-US$ 1.35, as compared to €-US$ 1.37 in 2013. Thisdifference resulted in an approximate € +0.2 billion increase in
EBIT* from 2013 to 2014. In addition, other currency translation
adjustments, including those related to the mismatch between
US dollar-denominated customer advances and corresponding
US dollar-denominated costs as well as the revaluation of lossmaking contract provisions, had an approximate positive effect of€ +0.24 billion on EBIT* compared to 2013. See “— 2.1.2.6 Foreign
Currency Translation”.
During 2013, cash flow hedges covering approximately
US$ 23.5 billion of the Group’s US dollar-denominated revenues
matured. In 2013, the compounded exchange rate at which
hedged US dollar-denominated revenues were accounted
for was €-US$ 1.37, as compared to €-US$ 1.36 in 2012. Thisdifference resulted in an approximate € -0.08 billion decreasein EBIT* from 2012 to 2013, mainly at Airbus. In addition, othercurrency translation adjustments, including those related to themismatch between US dollar-denominated customer advancesand corresponding US dollar-denominated costs as well as therevaluation of loss-making contract provisions, had a negative
effect of € -0.03 billion on EBIT* compared to 2012.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.4

Results of Operations

Set forth below is a summary of the Group’s consolidated income statements (IFRS) for the past three years.
Year ended
31 December 2014(in €m, except for earnings per share)

Year ended
31 December 2013(1)Year ended
31 December 2012(2)Revenues

60,71357,56756,480

Cost of sales(51,776)(49,613)(48,582)

Gross margin

8,937

7,954

7,898

Selling and administrative expenses(2,601)(2,762)(2,869)Research and development expenses(3,391)(3,118)(3,142)Other income

330

272

184

Other expenses

(179)

(259)

(229)

Share of profit from investments accounted for underthe equity method and other income from investments

895

483

247

Profit before finance costs and income taxes

3,991

2,570

2,089

Interest result

(320)

(332)

(285)

Other financial result

(458)

(278)

(168)

Income taxes

(863)

(477)

(438)

Profit for the period

2,350

1,483

1,198

2,343

1,473

1,197

2

Attributable to:Equity owners of the parent (Net Income)

7

10

1

Earnings per share (basic) (in €)

2.99

1.86

1.46

Earnings per share (diluted) (in €)

2.99

1.85

1.46

Non-controlling interests(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11.

Set forth below are year-to-year comparisons of results of operations, based upon the Group’s consolidated income statements.

2.1.4.1

Consolidated Revenues

Set forth below is a breakdown of Group’s consolidated revenues by Division for the past three years.

(in €m)Year ended
31 December 2014

Year ended
31 December 2013(1)Year ended
31 December 2012(2)Airbus42,28039,49437,624

Airbus Helicopters

6,524

6,297

6,264

Airbus Defence and Space

13,025

13,121

13,520Total Divisional revenues

61,82958,912

57,408Other – HQ / Consolidation(1,116)(1,345)

(928)

Total

60,71357,56756,480(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure. See “— 2.1.1.2 Reportable Business Segments”.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. The Divisional figures are restated to reflect the new segment structure.

For 2014, consolidated revenues increased by 5.5%, from€ 57.6 billion (adjusted) for 2013 to € 60.7 billion for 2014. The
increase was primarily due to higher revenues at Airbus.

For 2013, consolidated revenues increased by 1.9% (adjusted),from € 56.5 billion for 2012 to € 57.6 billion (adjusted) for 2013. The
increase was primarily due to higher revenues at Airbus, partly
compensated by the adjustment in 2013 due to the application of
IFRS 10 and IFRS 11 (€ -1.7 billion).

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AirbusSet forth below is a breakdown of deliveries of commercial aircraft by product type for the past three years.
Year ended
31 December 2014

Year ended
31 December 2013

Year ended
31 December 2012

Single-aisle

490

493

455

Long-range

108

108

103

A350 XWB

100

Number of aircraft

Very large

30

25

30

Total

629

626

588(1)(1) 585 aircraft with revenue recognition (three A330-200 delivered under operating lease).

Airbus’ consolidated revenues increased by 7.1%, from € 39.5 billion(adjusted) for 2013 to € 42.3 billion for 2014, driven by the overall
increase in deliveries to a record 629 aircraft (626 deliveries in2013) and a more favourable delivery mix including 30 A380s
compared to 25 in 2013.

Airbus’ consolidated revenues increased by 5.0% (adjusted),from € 37.6 billion for 2012 to € 39.5 billion (adjusted) for 2013.
The increase was primarily due to higher aircraft deliveries (626deliveries in 2013, as compared to 588 deliveries in 2012 withrevenue recognition for 585).

Airbus Helicopters
Set forth below is a breakdown of deliveries of helicopters by product type for the past three years.
Year ended
31 December 2014

Year ended
31 December 2013

Year ended
31 December 2012

Tiger

12

11

10

Light

226

269

227

Medium

132

136

168

Heavy

101

81

70

Number of aircraftof which NH90

53

44

35

Total

471

497

475

Consolidated revenues at Airbus Helicopters increased by 3.6%,
from € 6.3 billion for 2013 to € 6.5 billion for 2014 mainly driven
by government programmes including the ramp-up in NH90
activity. Helicopter deliveries totalled 471 units (FY 2013: 497 units),
including the successful entry-into-service (EIS) of the EC175 in
the fourth quarter following the EIS of the EC145 T2 and EC135
T3 earlier in the year.

Consolidated revenues of Airbus Helicopters remained stableat € 6.3 billion in 2013, accompanied by an overall increase inhelicopter deliveries from 475 in 2012 to 497 in 2013. The stablerevenue level reﬂects a weaker revenue mix effect.

Airbus Defence and SpaceSet forth below is a breakdown of deliveries of Airbus Defence and Space by product type for the past three years.
Year ended
31 December 2014

Year ended
31 December 2013

Year ended
31 December 2012

A400M

8

2

0

A330 MRTT (Tanker)

5

7

5

Light & Medium aircraft

19

22

24

Telecom satellites

5

3

3

Total

48

51

52

Number of aircraft

Airbus Defence and Space’s consolidated revenues were broadly
stable with a slight decrease by -0.7%, from € 13.1 billion (adjusted)for 2013 to € 13.0 billion for 2014. Revenues were driven by military
aircraft with eight A400M deliveries in total to four nations and by
space systems with six Ariane 5 launches during the year.

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Airbus Defence and Space’s consolidated revenues decreasedby -3.0% (adjusted), from € 13.5 billion for 2012 to € 13.1 billion(adjusted) for 2013. The decrease in 2013 is fully related to theadjustments according to IFRS 10 and IFRS 11 (€ -1.3 billion). The
operational increase of € +0.9 billion was primarily due to the

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A400M ramp up, including the delivery of two A400Ms to the
French Air Force, higher volume both for tankers and for light andmedium aircraft and continued programme execution, particularly
in Euroﬁghter and space systems despite lower activity in services.

2.1.4.2

Consolidated Cost of Sales

Consolidated cost of sales increased by 4.4%, from € 49.6 billion(adjusted) for 2013 to € 51.8 billion for 2014. The increase wasprimarily due to strong delivery patterns, costs related to businessgrowth at Airbus, increased A350 XWB support costs and to a
net charge of € 551 million related to the A400M programme as aresult of Management’s review. In Q4 2013, a negative charge of€ 434 million was recorded on the A350 XWB programme which ispartly compensating the increase in 2014. See “— 2.1.1.3 SigniﬁcantProgramme Developments, Restructuring and Related Financial
Consequences in 2012, 2013 and 2014”. Consolidated cost of
sales also includes the amortisation of capitalised development
costs pursuant to IAS 38, which amounted to € -137 million in 2014
compared to € -106 million (adjusted) in 2013. Notwithstanding
the above stated items, the gross margin increased from 13.8%(adjusted) in 2013 to 14.7% in 2014.
Consolidated cost of sales increased by 2.1% (adjusted) despite
certain cost savings, from € 48.6 billion for 2012 to € 49.6 billion(adjusted) for 2013. The increase was primarily due to strong delivery
patterns and costs related to business growth at Airbus as well asa restructuring provision and charges incurred for restructuring,
A350 XWB and A380 programmes and negative currency effects.
The increase was mitigated by the adjustments in 2013 due to theapplication of IFRS 10 and IFRS 11 (€ -1.3 billion). Consolidated
cost of sales also includes the amortisation of capitalised
development costs pursuant to IAS 38, which amounted to € -106
million (adjusted) in 2013 compared to € -171 million (historical) in
2012. Notwithstanding the above stated items, the gross margindecreased from 14.0% in 2012 to 13.8% in 2013.

2.1.4.3

Consolidated Selling and Administrative
Expenses

Consolidated selling and administrative expenses decreased by
5.8%, from € 2.8 billion (adjusted) for 2013 to € 2.6 billion for 2014.
Consolidated selling and administrative expenses decreased by
3.7%, from € 2.9 billion for 2012 to € 2.8 billion (adjusted) for 2013.
The decrease in 2013 is fully related to the adjustments in 2013
due to the application of IFRS 10 and IFRS 11.

2.1.4.4

Consolidated Research and Development
Expenses

Consolidated research and development expenses increased by
8.8%, from € 3.1 billion (adjusted) for 2013 to € 3.4 billion for 2014,
primarily reﬂecting R&D activities at Airbus. The main contribution
to the expenses comes from the A350 XWB programme. In
addition, an amount of € 58 million of development costs for
the A350 XWB programme has been capitalised. See “—2.1.2.4
Capitalised development costs”.

Consolidated research and development expenses remained
stable at € 3.1 billion for 2013, primarily reﬂecting R&D activities
at Airbus. The main contribution to the expenses comes from theA350 XWB programme. In addition, an amount of € 354 million
of development costs for the A350 XWB programme has been
capitalised.

2.1.4.5

2

Consolidated Other Income
and Other Expenses

Consolidated other income and other expenses include gains andlosses on disposals of investments in ﬁxed assets and income
from rental properties.
For 2014, other income and other expenses was € +151 million
net as compared to € +13 million (adjusted) net for 2013. The netincrease was partly due to the sale of the Paris Headquarters
building.
For 2013, other income and other expenses was € +13 million(adjusted) net as compared to € -45 million for 2012. The increaseis mainly related to the adjustments in 2013 due to the applicationof IFRS 10 and IFRS 11.

2.1.4.6

Consolidated Share of Proﬁt
from Investments Accounted for under
the Equity Method and Other Income
from Investments

Consolidated share of proﬁ t from investments accounted forunder the equity method and other income from investments
principally includes results from companies accounted for underthe equity method and the results attributable to non-consolidated
investments.
For 2014, the Group recorded € 895 million in consolidated shareof proﬁt from investments accounted for under the equity method
and other income from investments as compared to € 483 million(adjusted) for 2013. The € 412 million increase is mainly due to a gainof € 343 million from the partial sale of shares of Dassault Aviationand to a gain of € 47 million from the disposal of shares of Patria.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 16: Investments accounted for under the equity method”.
For 2013, the Group recorded € 483 million (adjusted) inconsolidated share of proﬁ t from investments accounted forunder the equity method and other income from investments ascompared to € 247 million (historical) for 2012. The € 236 million
increase is mainly related to the adjustments in 2013 due to theapplication of IFRS 10 and IFRS 11 and to the Group’s equity
investment in Dassault Aviation.

2.1.4.7

Consolidated Interest Result

Consolidated interest result reﬂects the net of interest income
and expense arising from ﬁnancial assets and liabilities, includinginterest expense on refundable advances provided by European
governments to ﬁnance R&D activities.

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For 2014, the Group recorded a consolidated net interest expenseof € -320 million, as compared to € -332 million (adjusted) for 2013.
The small improvement in interest result is due to lower interest
expense recorded on European government refundable advances.
For 2013, the Group recorded a consolidated net interest expenseof € -332 million (adjusted), as compared to € -285 million (historical)
for 2012. The deterioration in interest result is primarily due to lower
interest income recorded on the Group’s cash balances.

2.1.4.8

Consolidated Other Financial Result

This line item includes, among others, the impact from therevaluation of ﬁnancial instruments, the effect of foreign exchange
valuation of monetary items and the unwinding of discounted
provisions. See “— Notes to the Consolidated Financial
Statements (IFRS) — Note 2: Summary of signiﬁcant accounting
policies — Signiﬁcant Accounting Policies — Derivative ﬁnancial
instruments — Embedded derivatives”.
Consolidated other ﬁnancial result reduced from € -278 million(adjusted) for 2013 to € -458 million for 2014. This negative€ -180 million change mainly results from an increase in thenegative impact of revaluation of ﬁnancial instruments, related to
the weakening of the € versus the USD in the fourth quarter 2014.
Consolidated other ﬁnancial result reduced from € -168 million(historical) for 2012 to € -278 million (adjusted) for 2013. This
negative € -110 million (adjusted) change mainly results from thedeterioration of the impact of revaluation changes of US-dollarand pound sterling-denominated cash balances on the eurodenominated statements of ﬁnancial position of Group companies.

2.1.4.9

Consolidated Income Taxes

For 2014, income tax expense was € -863 million as compared to€ -477 million (adjusted) for 2013. The increase was primarily due
to the higher income before tax recorded in 2014 (€ 3,213 million)
as compared to 2013 (€ 1,960 million (adjusted)). The effective tax
rate was 27% in 2014. See “— Notes to the Consolidated Financial
Statements (IFRS) — Note 12: Income taxes”.

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For 2013, income tax expense was € -477 million (adjusted) as
compared to € -438 million (historical) for 2012. The increase
was primarily due to the higher taxable income recorded in 2013(€ 1,960 million (adjusted)) as compared to 2012 (€ 1,636 million).
The effective tax rate was 24% (adjusted) in 2013.

2.1.4.10 Consolidated Non-Controlling Interests
For 2014, consolidated proﬁt for the period attributable to noncontrolling interests was € 7 million, as compared to € 10 million
for 2013.

2.1.4.11 Consolidated Proﬁt for the Period
Attributable to Equity Ownersof the Parent (Net Income)As a result of the factors discussed above, the Group recorded
consolidated net income of € 2,343 million for 2014, as comparedto € 1,473 million (adjusted) for 2013.

2.1.4.12 Earnings per Share
Basic earnings were € 2.99 per share in 2014, as compared to€ 1.86 per share (adjusted) in 2013. The number of issued shares
as of 31 December 2014 was 784,780,585. The denominator
used to calculate earnings per share was 782,962,385 shares (in2013: 792,466,862), reﬂecting the weighted average number ofshares outstanding during the year. In 2012, the Group reported
basic earnings of € 1.46 per share, based on a denominator of
819,378,264 shares.
Diluted earnings were € 2.99 per share in 2014, as comparedto € 1.85 per share (adjusted) in 2013. The denominator used to
calculate diluted earnings per share was 784,155,749 (in 2013:
794,127,812), reﬂecting the weighted average number of shares
outstanding during the year, adjusted to assume the conversionof all potential ordinary shares. In 2012, the Group reported
diluted earnings of € 1.46 per share, based on a denominator of
820,551,931 shares.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 23: Total equity” and “— Note 37: Earnings per share”.

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2.1.5

Changes in Consolidated Total Equity (Including Non-Controlling Interests)

The following table sets forth a summary of the changes in consolidated total equity for the period 1 January 2014 through31 December 2014.
(in €m)Balance as at 31 December 2013 (adjusted)(1)2

10,906

Profit for the period

2,350

Other comprehensive income(5,724)

Thereof foreign currency translation adjustments

250

Cash distribution to shareholders / dividends paid to non-controlling interests(589)

Capital increase52

Capital decrease(12)

Equity transactions (IAS 27)

4

Change in non-controlling interests(17)

Change in treasury shares

72

Cancellation of treasury shares

42

Share-based payment (IFRS 2)(5)

Balance as at 31 December 2014

7,079

(1) 2013 figure is adjusted for the application of IFRS 10 and IFRS 11.

The decrease of consolidated total equity in 2014 primarily reﬂects
the decrease of other comprehensive income (“OCI”) (€ -5.7 billion),
mainly due to the negative variation (net of tax) of the year-end markto market valuation of that portion of the Group’s hedge portfolio
qualifying for cash ﬂow hedge accounting under IAS 39 (“cashflow hedges”) and to the net actuarial losses on deﬁned beneﬁtplans, as well as to the cash distribution to shareholders/dividends
paid to non-controlling interests (€ -0.6 billion). The decrease of
consolidated total equity was partially offset by, among others,
proﬁt for the period recorded for 2014 (€ 2.4 billion).
Set forth below is a discussion on the calculation of AOCI and therelated impact on consolidated total equity. For a discussion of theother line items affecting consolidated total equity, see “— Airbus
Group N.V. Consolidated Financial Statements (IFRS) — IFRS
Consolidated Statements of Changes in Equity for the years ended
31 December 2014 and 2013”.

2.1.5.1

Cash Flow Hedge Related Impact on AOCI

As of 31 December 2014, the notional amount of the Group’s
portfolio of outstanding cash flow hedges amounted to
US$ 88.3 billion, hedged against the euro and the pound sterling.
The year-end mark to market valuation of this portfolio required
under IAS 39 resulted in a negative pre-tax AOCI valuation changeof € -6.4 billion from 31 December 2013, based on a closing rateof €-US $ 1.21 as compared to a positive pre-tax AOCI valuation
change of € 2.2 billion (adjusted) as of 31 December 2013 from31 December 2012, based on a closing rate of €-US$ 1.38. For
further information on the measurement of the fair values of ﬁnancial
instruments see “—Notes to the Consolidated Financial Statements(IFRS) — Note 34: Information about ﬁnancial instruments”.
Positive pre-tax mark to market values of cash ﬂow hedges areincluded in other ﬁnancial assets, while negative pre-tax mark tomarket values of cash ﬂow hedges are included in other ﬁnancial
liabilities. Year-to-year changes in the mark to market value ofeffective cash ﬂow hedges are recognised as adjustments to AOCI.
These adjustments to AOCI are net of corresponding changes todeferred tax assets (for cash ﬂow hedges with negative mark tomarket valuations) and deferred tax liabilities (for cash ﬂow hedges
with positive mark to market valuations). Set out below is a graphic
presentation of cash ﬂow hedge related movements in AOCI overthe past three years (in €m).
Nota : the mark to market of the backlog is not reﬂected in theaccounts whereas the mark to market of the hedge book is
reﬂected in AOCI.

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CASH FLOW HEDGE RELATED MOVEMENTS IN AOCI IN €M (BASED ON YEAR-END EXCHANGE RATES)-600

OCI Net Liability

1,625-4,797184-526

Net Deferred Taxes

1,465

31 December 2013: US$ 1.38

-416

Net Equity OCI

31 December 2012: US$ 1.32

1,099
-3,33231 December 2014: US$ 1.21

As a result of the negative change in the fair market valuation of the cash ﬂow hedge portfolio in 2014, AOCI amounted to a net liabilityof € -4.8 billion for 2014, as compared to a net asset of € 1.6 billion (adjusted) for 2013. The corresponding € 2.0 billion tax effect led
to a net deferred tax asset of € 1.5 billion as of 31 December 2014 as compared to a net deferred tax liability of € -0.5 billion as of
31 December 2013.
See “— Notes to the Consolidated Financial Statements (IFRS) — Note 34b: Carrying amounts and fair values of ﬁnancial instruments”
for further information.

2.1.5.2

Currency Translation Adjustment Impact on AOCIThe € 250 million currency translation adjustment related impact on AOCI in 2014 mainly reﬂects the effect of the variation of the US dollar.

2.1.6

Liquidity and Capital Resources

The Group’s objective is to generate sufﬁcient operating cash ﬂow
in order to invest in its growth and future expansion, honour theGroup’s dividend policy, maintain ﬁnancial ﬂexibility while retaining
its credit rating and competitive access to capital markets.
The Group deﬁnes its consolidated net cash position as the sum of(i) cash and cash equivalents and (ii) securities, minus (iii) ﬁnancing
liabilities (all as recorded in the consolidated statement of ﬁnancial
position). The net cash position as of 31 December 2014 was€ 9.1 billion (€ 8.5 billion (adjusted) as of 31 December 2013).
This net cash position is further supported by a € 3.0 billion
syndicated back-up facility, undrawn as of 31 December 2014
with no ﬁnancial covenants, as well as a Euro medium term note
programme and commercial paper programme. See “— 2.1.6.3
Consolidated Financing Liabilities”. The factors affecting theGroup’s cash position, and consequently its liquidity risk, arediscussed below.

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Airbus Group N.V. has two ofﬁcial long-term credit ratings, the ﬁrst
being A2 with a stable outlook by Moody’s Investors Service Inc.
(“Moody’s”), and the second A with a stable outlook by Standard
and Poor’s Credit Market Services Europe Limited (“Standard& Poor’s”). Standard & Poor’s also provides an ofﬁ cial shortterm rating for Airbus Group N.V. which currently stands at A-1.
Airbus Group N.V. also has an unsolicited long-term credit ratingof A- with a stable outlook by Fitch Polska S.A. (“Fitch Ratings”).
Standard and Poor’s and Fitch Ratings are established in theEuropean Union and, as of the date of this Registration Document,
are registered as credit rating agencies in accordance with EC
Regulation 1060 / 2009 of the European Parliament and of theCouncil of 16 September 2009 on credit rating agencies (the“CRA Regulation”). Moody’s is not established in the European
Union and not registered under the CRA Regulation but Moody’s
Investors Service Ltd., its European Union credit rating agency
afﬁliate, is registered under the CRA Regulation and has endorsed
Moody’s rating.

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2.1.6.1 Cash Flows
The Group generally ﬁnances its manufacturing activities and product development programmes, and in particular the development of
new commercial aircraft, through a combination of ﬂows generated by operating activities, customer advances, risk-sharing partnerships
with sub-contractors and European government refundable advances. In addition, the Group’s military activities beneﬁt from governmentﬁnanced research and development contracts. If necessary, the Group may raise funds in the capital markets.
The following table sets forth the variation of the Group’s consolidated net cash position over the periods indicated.
(in €m)2014

2013(1)

2012(2)

Consolidated net cash position at 1 January

8,454

11,724

11,681Gross cash flow from operations(3)

5,595

4,143

4,772

Changes in other operating assets and liabilities(2,386)(2,091)

(76)

108

(319)

(146)

Cash used for investing activities(4)(1,207)(2,879)(3,448)Thereof industrial capital expenditures(2,548)(2,918)(3,270)Free cash flow(5)

2,002

(827)

1,248

Thereof M&A transactions

893

(16)

(201)

Free cash flow before acquisitions

1,109

(811)

1,449

Cash flow from customer financing (net)

108

(319)

(146)

Free cash flow before customer financing

1,894

(508)

1,394

Thereof customer financing

Cash distribution to shareholders / non-controlling interests

(589)

(469)

(379)

Contribution to plan assets of pension schemes

(462)

(223)

(856)

Changes in capital and non-controlling interests

52

171

144

Share buy-back / Change in treasury shares

102(1,915)(5)

Others

(467)

(7)

459

Consolidated net cash position as of 31 December

9,092

8,454

12,2922(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.
(2) 2012 figures have not been adjusted for IFRS 10 and IFRS 11. Therefore, the consolidated net cash position as of 31 December 2012 deviates from the consolidated net cash
position at 1 January 2013. The difference is related to the at equity consolidation of formerly proportionately consolidated Joint Ventures (mainly MBDA and Atlas Elektronik).
(3) Represents cash provided by operating activities, excluding (i) changes in other operating assets and liabilities (working capital), (ii) contribution to plan assets of pension schemesand (iii) realized fx results on Treasury swaps (€ 0 in 2012 and 2013; € -187 million in 2014).
(4) Does not reflect change of securities (net disposal of € 3,422 million (historical) for 2012, net disposal of € 1,267 million (adjusted) for 2013; net investment of € -2,016 million for 2014),
which are classified as cash and not as investments solely for the purposes of this net cash presentation.
(5) Does not reflect change of securities, contribution to plan assets of pension schemes and realized fx results on Treasury swaps.

The net cash position as of 31 December 2014 was € 9.1 billion,
a 7.5% increase from 31 December 2013. The increase primarily
reﬂects the gross cash ﬂow from operations (€ 5.6 billion), partially
offset by the build-up of other operating assets and liabilities(€ -2.4 billion), the cash used for investing activities (€ -1.2 billion),the cash distribution to shareholders/ non-controlling interests(€ -0.6 billion) and the contribution to plan assets of pension
schemes (€ -0.5 billion).

Gross Cash Flow from Operations
Gross cash ﬂow from operations increased by 35.0% to € 5.6 billion
for 2014, primarily due to the improvement of operating proﬁtability
before depreciation and provisioning.

Changes in Other Operating Assets and Liabilities
Changes in other operating assets and liabilities is comprised ofinventories, trade receivables, other assets and prepaid expenses
netted against trade liabilities, other liabilities (including customer
advances), deferred income and customer ﬁnancing. They resulted

in a € -2.4 billion negative impact on the net cash position for2014, as compared to a negative impact of € -2.1 billion for 2013.
In 2014, the main net contributor to the negative working capitalvariation was the change in inventory (€ -3.3 billion) reﬂ ecting
inventory growth at Airbus especially due to investment inprogrammes to support both production and development,
particularly for the A350 XWB and Single Aisle programmes, as well
as at Airbus Defence and Space. Additionally, trade receivables
contributed negatively (€ -0.7 billion). These negative variations
within the year were partially offset by pre-delivery payments from
customers (€ 1.7 billion), which increased compared to 2013.
In 2013, the main net contributor to the negative working capitalvariation was the change in inventory (€ -3.1 billion (adjusted))
reﬂecting inventory growth at Airbus especially for the A380, A400M
and A350 XWB programmes as well as at Airbus Helicopters. This
negative variation within the year was partially offset by (i) predelivery payments from customers (€ 0.6 billion (adjusted)) and by(ii) the change in trade liabilities (€ 0.5 billion (adjusted)).

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European government refundable advances. As of 31 December
2014, total European Government refundable advances received,
recorded on the statement of ﬁnancial position in the line items“non-current other ﬁnancial liabilities” and “current other ﬁnancial
liabilities” due to their speciﬁc nature, amounted to € 6.5 billion,
including accrued interest.

Change in Treasury Shares

European government refundable advances (net of reimbursements)
as recorded on the statement of ﬁnancial position increased in 2014,
due primarily to refundable advances received for the A350 XWB.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 27: Other ﬁnancial liabilities”.

Change in treasury shares for 2014 amounted to € + 0.1 billion.

Cash Used for Investing Activities

Contribution to Plan Assets of Pension Schemes

Management categorises cash used for investing activities into
three components: (i) industrial capital expenditures, (ii) M&A
transactions and (iii) others.

The cash outﬂows of € -0.5 billion, € -0.2 billion and € -0.9 billion in2014, 2013 and 2012, respectively, primarily relate to a contribution
to the Contractual Trust Arrangement (CTA) for allocating andgenerating pension plan assets in accordance with IAS 19, as
well as to plan assets in the UK and to German beneﬁt funds.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 25b: Provisions for retirement plans”. In 2015, the Groupintends to make additional € 200 million contributions to plan assets
in order to reduce the provision for retirement plans on its statementof ﬁnancial position.

Industrial capital expenditures. Industrial capital expenditures(investments in property, plant and equipment and intangible assets)
amounted to € -2.5 billion for 2014 as compared to € -2.9 billion
for 2013 and € -3.3 billion for 2012. Capital expenditures in 2014
related to programmes at Airbus of € -1.7 billion (a large portionof which related to the ramp-up phase of the A350 XWB) andadditional projects in the other Divisions of € -0.8 billion. Capital
expenditures include product-related development costs that arecapitalised in accordance with IAS 38. See “—2.1.2.4 Capitalised
Development Costs”.
For 2015, it is expected that the majority of the Group’s capital
expenditures will occur in connection with Airbus activities, inparticular for the A350 XWB programme, and be broadly distributed
across the Group’s home markets of France, Germany, Spain andthe UK.
M&A transactions. In 2014, the € 893 million ﬁgure principally
reﬂects the partial sale of shares of Dassault Aviation (€ 792 million)
and the disposal of shares of Patria (€ 133 million). Cash was used
for the Group’s acquisitions of Alestis Aerospace S.L. (€ -22 million)
and of Salzburg München Bank AG (€ -21 million).
In 2013, the € -16 million ﬁgure principally reﬂects the net cashused for the Group’s acquisition of Arkoon. See “— Notes to theConsolidated Financial Statements (IFRS) — Note 31: Consolidated
statements of cash ﬂows”.

Free Cash Flow
The Group deﬁnes free cash ﬂow as the sum of (i) cash provided
by operating activities and (ii) cash used for investing activities,
minus (iii) change of securities, (iv) contribution to plan assets ofpension schemes and (v) realized Fx results on Treasury swaps. As
a result of the factors discussed above, free cash ﬂow amounted74

to € 2.0 billion for 2014 as compared to € -0.8 billion for 2013 and€ 1.2 billion for 2012. Free cash ﬂow before customer ﬁnancing
was € 1.9 billion for 2014 as compared to € -0.5 billion for 2013and € 1.4 billion for 2012.

Change in treasury shares for 2013 amounted to € -1.9 billion whichwere used for the share buy-back of around 53 million shares. The
share buy-back supported the increase of the free ﬂoat to morethan 70%.

OthersIn 2014, the negative change of € -467 million reﬂects among others
the change in consolidated ﬁnancing liabilities (mainly due to theﬁrst consolidation of Airbus Group bank). In 2012, the positivechange of € 459 million mainly results from revaluation of securities
and ﬁnancing liabilities.

2.1.6.2

Consolidated Cash and Cash Equivalents
and Securities

The cash and cash equivalents and securities portfolio of the Groupis invested mainly in non-speculative ﬁnancial instruments, mostly
highly liquid, such as certiﬁcates of deposit, overnight deposits,commercial paper, other money market instruments and bonds. See“—2.1.7.2 Interest Rates” and “— Notes to the Consolidated Financial
Statements (IFRS) — Note 34a: Financial risk management”.
The Group has a fully automated cross-border cash poolingsystem (covering France, Germany, Spain, the Netherlands, theUK and the US). The cash pooling system enhances Management’s
ability to assess reliably and instantaneously the cash position ofeach subsidiary within the Group and enables Management toallocate cash optimally within the Group depending upon shifting
short-term needs.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.6.3

Consolidated Financing Liabilities

The following table sets forth the composition of the Group’s consolidated ﬁnancing liabilities, including both short- and long-term
debt, as of 31 December 2014:31 December 2014(in €m)Not exceeding 1 year

Over 1 year up to 5 years

More than 5 years

Total

Bonds

1

1,543

2,374

3,918

Liabilities to financial institutions

22

526

1,225

1,773

Loans

285

243

181

709

Finance leases

12

70

116

198

Others

753

0

0

753

Total

1,073

2,382

3,896

7,351

2

(1) Financing liabilities include non-recourse Airbus debt for € 46 million.

The outstanding balance of financing liabilities increased
from € 5.6 billion as of 31 December 2013 to € 7.4 billion as of
31 December 2014. This increase is mainly related to the € 1.0 billion
EMTN bond issue in April 2014 and the € 0.5 billion EMTN bondissue in October 2014.
Financing liabilities include liabilities connected with sales ﬁnancing
transactions amounting to € 46 million as of 31 December 2014,
most of which bore interest at variable rates. See “— 2.1.6.4 Sales
Financing”.
Liabilities to ﬁnancial institutions as of 31 December 2014 include
no short-term liabilities from securities lending activities (2013:€ 608 million).
EMTN programme. The Group has a € 5 billion Euro Medium Term
Note (“EMTN”) Programme in place, with four tranches outstanding
as of 31 December 2014:€ 0.5 billion of notes issued in 2003 and maturing in 2018, bearing
interest at 5.5% (effective interest rate: 5.58%) and subsequently
swapped into a variable rate of three-month EURIBOR plus
1.72%;■€ 1.0 billion of notes issued in 2009 and maturing in 2016,
bearing interest at 4,625% (effective interest rate: 4.68%) andsubsequently swapped into a variable rate of three-month
EURIBOR plus 1.57%;■€ 1.0 billion of notes issued in 2014 and maturing in 2024, bearing
interest at 2,375% (effective interest rate: 2,394%); and■€ 0.5 billion of notes issued in 2014 and maturing in 2029, bearing
interest at 2,125% (effective interest rate: 2,194%).
■

US bond. On 17 April 2013, the Group placed an inaugural
US$ 1 billion issue on the US institutional market under 144A /Reg S format. The bond carries a ﬁxed coupon of 2.70% (effective
interest rate 2.73%) and matures in April 2023.
Commercial paper programme. The Group has the ability toissue commercial paper on a rolling basis, under a so-called “billet
de trésorerie” programme. This commercial paper would bearinterest at ﬁxed or ﬂoating rates with individual maturities ranging
from 1 day to 12 months. The programme has been in place since2003 and has a maximum authorised volume limit of € 3 billion. Asof 31 December 2014, there was no outstanding amount under
the programme.

European Investment Bank loans. In 2004, the European
Investment Bank granted a long-term loan to the Group in theamount of US$ 421 million and bearing interest at 5.11% (effective
interest rate: 5.11%). This loan matured and has been consequently
fully repaid in August 2014. In 2011, the Group entered into a
US$ 721 million long-term credit agreement maturing in 2021 (withstraight line amortisation from August 2015 onwards) with theEuropean Investment Bank, bearing interest at a variable rate ofthree-month USD LIBOR plus 0.85%. The Group concurrently
swapped the variable interest rate into a ﬁ xed rate of 3.2%. In
2013, the Group entered into a US$ 406 million long-term credit
agreement maturing in 2020 with the European Investment Bank,
bearing interest at a variable rate of three-month USD LIBOR plus
0.93%. In 2014, the Group entered into a US$ 627 million long-term
credit agreement with the European Investment Bank maturing in
2024 with a ﬁxed 2.52% interest rate.
Development Bank of Japan loan. In 2011, the Group enteredinto a US$ 300 million loan maturing in 2021 (bullet loan) with
the Development Bank of Japan, fully drawn down and bearing
interest at a variable rate of three-month USD LIBOR plus 1.15%.
The Group concurrently swapped the variable interest rate into aﬁxed rate of 4.76%.
For further information, see “— Notes to the Consolidated Financial
Statements (IFRS) — Note 26: Financing liabilities”.

2.1.6.4

Sales Financing

The Group favours cash sales and encourages independentﬁnancing by customers, in order to avoid retaining credit or asset
risk in relation to delivered products. However, in order to support
product sales, primarily at Airbus and Airbus Helicopters, theGroup may agree to participate in the ﬁnancing of customers, ona case-by-case basis, directly or through guarantees provided tothird parties.
The ﬁnancial markets remain unpredictable, which may cause theGroup to increase its future outlays in connection with customer
ﬁnancing of commercial aircraft, mostly through ﬁnance leases
and secured loans. Nevertheless, it intends to keep the amountas low as possible.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

Dedicated and experienced teams structure such financing
transactions and closely monitor total Group ﬁnance and asset
value exposure and its evolution in terms of quality, volume andintensity of cash requirements. The Group aims to structure all
ﬁnancing it provides to customers in line with market-standard
contractual terms so as to facilitate any subsequent sale or
reduction of such exposure.
In determining the amount and terms of a ﬁnancing transaction,
Airbus takes into account the airline’s credit rating as well as risk

factors speciﬁ c to the intended operating environment of theaircraft and its expected future value. Market yields and current
banking practices also serve to benchmark the ﬁnancing terms
offered to customers.
0.6% of the € 7.4 billion of total consolidated ﬁnancing liabilities
as of 31 December 2014 related to the funding of the Group’s
sales ﬁnancing assets, which are of a long-term nature and havepredictable payment schedules.

Set out below is a breakdown of the total amount of sales ﬁnancing liabilities outstanding.
2014(in €m)2013(1)

Liabilities to financial institutions

0

11

Loans

46

39

Total sales financing liabilities

46

50(1) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.

All of the € 46 million total sales financing liabilities as of
31 December 2014 are in the form of non-recourse debt, where
the Group’s repayment obligations are limited to its receipts
from transaction counterparties. A signiﬁcant portion of ﬁnancial
assets representing non-cancellable customer commitments haveterms closely matching those of the related ﬁnancing liabilities.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 26: Financing liabilities”. See also “— 2.1.2.7 Accounting
for Sales Financing Transactions in the Financial Statements”.
Furthermore, in 1999, Airbus received a reinvestment note from
Deutsche Bank AG in the amount of US$ 800 million, bearing aﬁxed interest rate of 9.88% with an outstanding debt of € 147 million
as of 31 December 2014 (2013: € 157 million).
Sales ﬁnancing transactions are generally collateralised by theunderlying aircraft. Additionally, Airbus and Airbus Helicopters
beneﬁt from protective covenants and from security packages
tailored according to the perceived risk and the legal environmentof each transaction.
The Group classiﬁes the exposure arising from its sales ﬁnancing
activities into two categories: (i) customer ﬁnancing exposure, where
the customer’s credit — its ability to perform its obligations undera ﬁnancing agreement — constitutes the risk; and (ii) asset value
exposure, where the risk relates to decreases in the future valueof the ﬁnanced aircraft. See also “— Risk Factors —1. Financial
Market Risks — Sales Financing Arrangements”.

76

Customer Financing Exposure
Gross exposure. Gross Customer Financing Exposure iscomputed as the sum of (i) the net book value of aircraft underoperating leases before impairment charge; (ii) the outstanding
principal amount of ﬁnance leases or loans before impairment; and(iii) the net present value of the maximum commitment amounts
under ﬁnancial guarantees.
Gross Customer Financing Exposure from operating leases,
ﬁnance leases and loans differs from the value of related assets
on the Group’s statement of ﬁnancial position and related offbalance sheet contingent commitments for the following reasons:(i) assets are recorded in compliance with IFRS, but may relate
to transactions where there is limited recourse to Airbus andAirbus Helicopters; (ii) the value of the assets is impaired on the
consolidated statement of ﬁnancial position; (iii) off-balance sheet
gross exposure is calculated as the net present value of future
payments, whereas the ﬁ nancial statements present the total
future payments in nominal terms; and (iv) exposure related tocertain asset value guarantees recorded as operating leases in theﬁnancial statements is categorised under asset value exposure,
not customer ﬁnancing exposure.
Airbus’ Gross Customer Financing Exposure amounted to
US$ 1.3 billion (€ 1.1 billion) as of 31 December 2014. The chart
below illustrates the evolution of this exposure during 2014
(in US$ million).

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

EVOLUTION OF AIRBUS GROSS EXPOSURE DURING 2014 IN US$

1,646

31 December 2013
Additions

Disposals

557

2

-715

Amortisation-149

31 December 2014

1,339

Airbus Gross Customer Financing Exposure as of 31 December
2014 is distributed over 83 aircraft, operated at any time byapproximately 27 airlines. In addition, the level of exposure may
include other aircraft-related assets, such as spare parts. Morethan 90% of Airbus Gross Customer Financing Exposure is
distributed over 14 airlines in 12 countries (this excludes backstop
commitments).
Airbus Helicopters’ Gross Customer Financing Exposure amounted
to € 81 million as of 31 December 2014. This exposure is distributed
over 58 helicopters.

Net exposure. Net exposure is the difference between gross
exposure and the estimated value of the collateral security.
Collateral value is assessed using a dynamic model based on
the net present value of expected future rentals from the aircraftin the leasing market and potential cost of default. This valuation
model yields results that are typically lower than residual value
estimates by independent sources in order to allow for whatmanagement believes is its conservative assessment of market
conditions, as well as for repossession and transformation costs.
See “— 2.1.2.7 Accounting for Sales Financing Transactions in the
Financial Statements”.

The table below shows the transition from gross to net ﬁnancing exposure (which does not include asset value guarantees) as of
31 December 2014 and 2013. It includes 100% of Airbus’ and Airbus Helicopters’ customer ﬁnancing exposure.
Airbus(in €m)Note(1)

Airbus Helicopters

31/12/2014 31/12/2013(2)

31/12/2014

Group Total

31/12/2013

31/12/2014 31/12/2013(2)Operating leases

14

327

485

-

-

327

485

Finance leases & loans

17

544

603

78

70

622

673

171

89

-

-

171

89

On balance sheet customer financing

1,042

1,177

78

70

1,120

1,247

Off balance sheet customer financing

126

134

9

14

135

148

Non-recourse transactions on balance sheet

(10)

(75)

(6)

-

(16)

(75)

Off balance sheet adjustments

(55)

(43)

-

-

(55)

(43)

Others (Inventory)

Gross Customer Financing Exposure

33

1,103

1,193

81

84

1,184

1,277

Collateral values

33

(743)

(851)

(37)

(41)

(780)

(892)

360

342

44

43

404

385

-

-

(114)

(134)

Net exposure
Asset impairments and provisions on:
Operating leases

33

(114)

(134)

Finance leases & loans

33

(179)

(159)

-

-

(179)

(159)

On balance sheet commitments –provisions

33

(3)

-

(44)

(43)

(47)

(43)

(42)

(10)

-

-

(42)

(10)

(22)

(39)

-

-

(22)

(39)

(360)

(342)

(44)

(43)

(404)

(385)

-

-

-

-

-

-

On balance sheet commitments – inventories
Off balance sheet commitments
Asset impairments and provisions
Residual exposure

33(1) The indicated numbers refer to the number of the Notes to Consolidated Financial Statements (IFRS).
(2) 2013 figures are adjusted for the application of IFRS 10 and IFRS 11.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

The gross value of consolidated operating leases shown in the table
above (€ 327 million in 2014 and € 485 million in 2013 (adjusted))is accounted for in “Property, plant and equipment” at net bookvalue of operating leases before impairment. Corresponding
accumulated asset impairments (€ -114 million in 2014 and€ -134 million in 2013 (adjusted)) are charged against this net bookvalue. See “— Notes to the Consolidated Financial Statements(IFRS) — Note 14: Property, plant and equipment” and “— Note 33:
Commitments and contingencies”.
Also shown in the table above is the gross value for consolidated
ﬁnance leases and loans (€ 622 million in 2014 and € 673 million in2013 (adjusted)). Consolidated ﬁnance leases (€ 17 million in 2014and € 195 million in 2013 (adjusted)) are accounted for as long-term
ﬁnancial assets, recorded at their book value before impairment.
Loans (€ 605 million in 2014 and € 478 million in 2013 (adjusted)) arealso accounted for as long-term ﬁnancial assets, recorded at theiroutstanding gross amount. Corresponding overall accumulated
impairments (€ -179 million in 2014 and € -159 million in 2013
(adjusted)) are charged against the book values. See “— Notes to
the Consolidated Financial Statements (IFRS) — Note 17: Other
investments and other long-term ﬁnancial assets”.
Off-balance sheet customer ﬁnancing exposure at Airbus andAirbus Helicopters was € 135 million in 2014 and € 148 million(adjusted) in 2013. These amounts reﬂect the total nominal valueof future payments under lease in / lease out structures. The
corresponding net present value of future payments (discounted
and net of mitigating factors) is included in total gross ﬁnancing
exposure for an amount of € 80 million in 2014 and € 105 million in2013 (adjusted). A provision of € 22 million has been accrued forin the Group’s balance sheet as of 31 December 2014 to cover
the full amount of the corresponding net exposure. See “— Notes
to the Consolidated Financial Statements (IFRS) — Note 33:
Commitments and contingencies”.

Asset Value Exposure
A signiﬁcant portion of the Group’s asset value exposure arises
from outstanding asset value guarantees, primarily at Airbus.
Management considers the ﬁnancial risks associated with suchguarantees to be manageable. Three factors contribute to thisassessment: (i) the guarantee only covers a tranche of the estimatedfuture value of the aircraft, and its level is considered prudent incomparison to the estimated future value of each aircraft; (ii) the
asset value guarantee-related exposure is diversiﬁed over a large
number of aircraft and customers; and (iii) the exercise dates ofoutstanding asset value guarantees are distributed through 2025,
resulting in low levels of exposure maturing in any year. In addition,these asset value guarantees must generally be exercised during a
pre-deﬁned window and contain speciﬁc conditions that must be
met in order for them to be exercisable. Airbus is currently engaged
in taking mitigation action to reduce the impact of asset value
guarantees falling due in the coming years relating to widebody
aircraft.

78

Gross exposure. Gross asset value exposure is deﬁned as thesum of the maximum guaranteed tranche amounts (as opposedto the sum of the maximum guaranteed asset value amounts)
under outstanding asset value guarantees. As of 31 December
2014, gross asset value exposure was US$ 1.2 billion (€ 1.0 billion).
The off-balance sheet portion of gross asset value exposure,
representing asset value guarantees with net present values ofless than 10% of the sales price of the corresponding aircraft, was€ 861 million, excluding € 146 million where the risk is considered tobe remote. In many cases, the risk is limited to a speciﬁc portion of
the residual value of the aircraft. The remaining gross asset value
exposure is recorded on-balance sheet.
Net exposure. The present value of the risk inherent to the given
asset value guarantees, where a settlement is considered to beprobable, is fully provided for and included in the amount of theprovision for asset value risks of € 618 million as of 31 December
2014. This provision covers a potential expected shortfall
between the estimated value of the aircraft of the date uponwhich the guarantee can be exercised and the value guaranteed
on a transaction basis taking counter guarantees into account.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 25c: Other provisions”.

Backstop Commitments
While backstop commitments to provide ﬁnancing related to orders
on Airbus’ backlog are also given, such commitments are notconsidered to be part of gross exposure until the ﬁnancing is inplace, which occurs when the aircraft is delivered. This is due tothe fact that (i) past experience suggests it is unlikely that all suchproposed ﬁ nancings actually will be implemented (although it ispossible that customers not beneﬁting from such commitments
may nevertheless request ﬁnancing assistance ahead of aircraft
delivery), (ii) until the aircraft is delivered, Airbus retains the asset
and does not incur an unusual risk in relation thereto (other thanthe corresponding work-in-progress), and (iii) third parties may
participate in the ﬁ nancing.
Airbus deliveries and ﬁ nancing support implemented atdelivery. Over the last three years (2014, 2013 and 2012), theaverage number of aircraft delivered in respect of which ﬁnancing
support has been provided by Airbus amounted to 1% of theaverage number of deliveries over the same period, i.e. 7 aircraft
ﬁnanced per year out of 614 deliveries per year on average. Thisﬁnancing support may take the form of senior or junior loans orguarantees. Such support may have originated from the Group’s
contractual backstop commitments provided at signing of thepurchase agreement (see above) or may be the result of a request
for ﬁnancing assistance made by the customer ahead of aircraft
delivery.
See “— Notes to the Consolidated Financial Statements (IFRS)— Note 33: Commitments and contingencies” for further
discussion of the Group’s sales ﬁnancing policies and accounting
procedures.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.1 Operating and Financial Review

2.1.7

Hedging Activities

2.1.7.1

Foreign Exchange Rates

More than 70% of the Group’s revenues are denominatedin US dollars, with approximately 60% of such currency exposure“naturally hedged” by US dollar-denominated costs. The remainderof costs is incurred primarily in euros, and to a lesser extent, inpounds sterling. Consequently, to the extent that the Group does
not use ﬁnancial instruments to hedge its net current and futureexchange rate exposure from the time of a customer order to thetime of delivery, its proﬁts will be affected by market changes inthe exchange rate of the US dollar against these currencies, andto a lesser extent, by market changes in the exchange rate ofpound sterling against the euro. As the Group intends to generate
proﬁts only from its operations and not through speculation on
foreign currency exchange rate movements, the Group uses
hedging strategies solely to mitigate the impact of exchange rate
ﬂuctuations on its EBIT*. See “— 2.1.3.4 EBIT* Performance by
Division — Foreign Currency Impact on EBIT*”. See also “— Risk
Factors — 1. Financial Market Risks — Foreign Currency Exposure”.
As the Group uses ﬁnancial instruments to hedge its net foreign
currency exposure, the portion of its US dollar-denominatedrevenues not hedged by ﬁ nancial instruments is exposed tochanges in exchange rates. Of this non-hedged portion ofrevenues, a certain percentage (relating to customer pre-delivery
payments) is converted into euro at the spot rate effective at thetime the payment was received by the Group. The remainder of
non-hedged US dollar-denominated revenues (corresponding to
payments upon delivery) are subject to changes in the spot rate at
the time of delivery. See “— 2.1.2.6 Foreign Currency Translation”.
Exposure on aircraft sales. For products such as aircraft, theGroup typically hedges ﬁ rmly committed sales in US dollars.
The hedged items are deﬁned as ﬁrmly committed future cash
inﬂows for a given month based upon ﬁnal payments at delivery.
Usually, the Group designates a portion of the total monthly cash
inﬂ ows as the hedged position to cover its expected foreign
currency exposure. Therefore, as long as the actual gross foreign
currency cash inﬂows (per month) exceed the portion designatedas being hedged, a postponement or cancellation of sales
transactions and corresponding cash inﬂ ows have no impact
on the hedging relationship. Similarly, though to a lesser extent,
the Group hedges its expected foreign currency exposure arisingfrom US dollar cash outﬂows in the commercial aircraft businesson a ﬁ rst outﬂ ow basis. The amount of the expected ﬂ ows to
be hedged can cover up to 100% of the equivalent of the net
US dollar exposure at inception. The coverage ratio is adjusted
to take into account macroeconomic movements affecting the

spot rates and interest rates as well as the robustness of thecommercial cycle.
Exposure on non-aircraft business. For the non-aircraft businessthe Group hedges in- and outﬂows in foreign currencies from ﬁrmly
committed or forecast sales and purchase contracts. In the nonaircraft business, hedges are typically contracted in lower volumes
but follow similar ﬁrst ﬂow logic or are designated based on agreed
milestone payments.

2

Exposure on treasury operations. In connection with its treasury
operations, the Group enters into foreign exchange swap contracts(notional amount of € 1.4 billion as of 31 December 2014) to adjust
for short-term ﬂ uctuations of non-euro cash balances at theBusiness Unit level. Year-to-year changes in the fair market valueof these swaps are recorded in the consolidated income statementin the line item “other ﬁnancial result” if not designated as hedging
instruments. These changes may have a material impact on theGroup’s net income.
Embedded derivatives. The Group also has foreign currency
derivative instruments which are embedded in certain purchaseand lease contracts denominated in a currency other than thefunctional currency of the signiﬁ cant parties to the contract,
principally US dollar and pound sterling. Gains or losses relating
to such embedded foreign currency derivatives are reported in
the line item “other ﬁnancial result” if not designated as hedging
instruments. These changes may have a material impact on theGroup’s net income. See “— Notes to the Consolidated Financial
Statements (IFRS) — Note 2: Summary of signiﬁcant accounting
policies — Signiﬁcant accounting policies — Derivative ﬁnancial
instruments — Embedded derivatives”. In addition, the Grouphedges currency risk arising from ﬁnancial transactions in othercurrencies than euro, such as funding transactions or securities.
Hedge portfolio. The Group manages a long-term hedge portfoliowith a maturity of several years hedging its net exposure to US dollar
sales, mainly relating to the activities of Airbus (and to a lesser
extent, of Airbus Helicopters and Airbus Defence and Space). The
net exposure is deﬁned as the total currency exposure (US dollardenominated revenues), net of the part that is “naturally hedged”
by US dollar-denominated costs. This hedge portfolio covers to alarge extent the Group’s highly probable transactions. For ﬁnancial
reporting purposes, foreign currency transactions qualify as ahedged item if they are included in the internally audited orderbook or are otherwise considered highly probable, e.g. becauseof contractual or planning evidence.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.2 Financial Statements

The table below sets forth the notional amount of foreign exchange hedges in place as of 31 December 2014, and the average US dollar
rates applicable to corresponding EBIT*.
2015

2016

2017

2018

2019+

Total

25.0

22.7

20.7

12.6

7.2

88.3

€-US$

1.35

1.33

1.32

1.33

1.36

£-US$

1.59

1.58

1.59

1.60

1.62

Total Hedges (in US$bn)

Forward Rates (in US$)For further information regarding the notional amounts of the Group’s foreign exchange derivative ﬁnancial instruments, see “— Notes
to the Consolidated Financial Statements (IFRS) — Note 34d: Notional amounts of derivative ﬁnancial instruments”.

2.1.7.2

Interest Rates

The Group uses an asset-liability management approach with theobjective of limiting its interest rate risk. The Group undertakes
to match the risk proﬁle of its assets with a corresponding liability
structure. The remaining net interest rate exposure is managed
through several types of interest rate derivatives, primarily interest
rate swaps and to a lesser extent interest rate futures contracts,in order to minimise risks and ﬁnancial impacts.
The vast majority of related interest rate hedges qualify for hedge
accounting as either fair value hedges or cash ﬂow hedges.
The Group invests in ﬁ nancial instruments such as overnight
deposits, certiﬁcates of deposits, commercial papers, other money
market instruments and short-term as well as medium-term bonds.
For its ﬁnancial instruments portfolio, the Group holds on a regularbasis an asset management committee which aims at limiting
the interest rate risk on a fair value basis through a value-at-risk
approach.
For information regarding the notional amounts of the Group’s
interest rate derivative ﬁnancial instruments, see “— Notes to theConsolidated Financial Statements (IFRS) — Note 34d: Notionalamounts of derivative ﬁnancial instruments”. For further information
relating to market risk and the ways in which the Group attempts
to manage this risk, see “— Notes to the Consolidated Financial
Statements (IFRS) — Note 34a: Financial risk management”.

2.1.7.3

Commodity Price Risk

The Group is exposed to risk relating to ﬂuctuations in the pricesof commodities used in the supply chain. The Group manages
these risks in the procurement process and to a certain extent
uses derivative ﬁnancial instruments in order to mitigate the risks
associated with the purchase of raw materials.

2.1.7.4

Equity Price Risk

Under its Long-Term Incentive Plan (LTIP) the Group is exposed to
the risk of Airbus Group share price increases. The Group limits
these risks through the use of equity derivatives that have been
designated as hedging instruments in a cash ﬂow hedge.

2.2 Financial Statements
The Consolidated Financial Statements (IFRS) and the Company
Financial Statements of Airbus Group N.V. for the year ended
31 December 2014, together with the related notes, appendicesand Auditors’ reports, shall be deemed to be incorporated in andform part of this Registration Document.
In addition, the English versions of the following documents shallbe deemed to be incorporated in and form part of this Registration
Document:■80

the Consolidated Financial Statements (IFRS) and the Company
Financial Statements of EADS N.V. for the year ended
31 December 2012, together with the related notes, appendicesand Auditors’ reports, as incorporated by reference in theRegistration Document ﬁled in English with, and approved by,

the AFM on 3 April 2013 and ﬁled in English with the Chamberof Commerce of The Hague; and■the Consolidated Financial Statements (IFRS) and the Company
Financial Statements of EADS N.V. for the year ended
31 December 2013, together with the related notes, appendicesand Auditors’ reports, as incorporated by reference in theRegistration Document ﬁled in English with, and approved by,
the AFM on 4 April 2014 and ﬁled in English with the Chamberof Commerce of The Hague.
Copies of the above-mentioned documents are available freeof charge upon request in English at the registered ofﬁ ce of
the Company and in English, French, German and Spanish on
www.airbusgroup.com (Investors & Shareholders > Publications >Annual Reports and Registration Documents).

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Management’s Discussion and Analysis of Financial Condition and Results of Operations
2.4 Information Regarding the Statutory Auditors

Copies of the above-mentioned Registration Documents are alsoavailable in English on the website of the AFM on www.afm.nl(Professionals > Registers > Approved prospectuses). The abovementioned ﬁnancial statements are also available in English forinspection at the Chamber of Commerce of The Hague.

The Company conﬁrms that the reports of the auditors incorporated
by reference herein have been accurately reproduced and that as
far as the Company is aware and is able to ascertain from theinformation provided by the auditors, no facts have been omitted
which would render such reports inaccurate or misleading.

2
2.3 Statutory Auditors’ Fees
Services provided to the Group by Statutory Auditors and Members of their network for the ﬁnancial years 2014, 2013 and 2012:
KPMG Accountants N.V.
2014

2013

Ernst & Young Accountants LLP
2014 (1)

2012

2013

2012

Amountin €K%Amountin €K%Amountin €K%Amountin €K%Amountin €K%Amountin €K%

Audit process, certification,
examination of individualand consolidated accounts

5,812

66.5%

5,201

63.6%

5,780

55.0%

-

-

5,931

68.8%

5,836

61.3%

Additional tasks

2,344

26.9%

2,196

26.9%

3,725

35.5%

-

-

2,123

24.6%

3,158

33.2%

Sub-total

8,156

93.4%

7,397

90.5%

9,505

90.5%

-

-

8,054

93.4%

8,994

94.5%

Legal, tax, employment

573

6.6%

769

9.4%

961

9.2%

-

-

566

6.6%

519

5.5%

Information technology

-

-

8

0.1%

20

0.1%

-

-

-

-

-

-

Audit

Other services as relevant

Other
Sub-total

Total

-

-

-

-

22

0.2%

-

-

-

-

-

-

573

6.6%

777

9.5%

1,003

9.5%

-

-

566

6.6%

519

5.5%

8,729

100%

8,174

100%

10,508

100%

-

-

8,620

100%

9,513

100%

(1) In 2014, Airbus Group N.V. was audited by KPMG only. Other audit firms have audit fees related to audit process, certification and examination of individual and consolidated
accounts of € 6 million.

2.4 Information Regarding the Statutory Auditors

KPMG Accountants N.V.
Laan van Langerhuize 1 — 1186 DS Amstelveen — The Netherlands
Represented by R.J. Aalberts

Date of first
appointment

Expiration of current
term of office(1)10 May 2000

27 May 2015

(1) A resolution will be submitted to the Annual General Meeting of Shareholders to be held on 27 May 2015, in order to appoint KPMG Accountants N.V. as the Company’s auditor forthe 2015 financial year.

KPMG Accountants N.V. and its representative are registered with the NBA (Nederlandse Beroepsorganisatie van Accountants).

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General Description of the Company
and its Share Capital
3.1 General Description of the Company

84

3.1.1 Commercial and Corporate Names, Seat and Registered Ofﬁce

84

3.1.2 Legal Form

84

3.1.3 Governing Laws and Disclosures84

3.1.4 Date of Incorporation and Duration of the Company

86

3.1.5 Objects of the Company

86

3.1.6 Commercial and Companies Registry86

3.1.7 Inspection of Corporate Documents

86

3.1.8 Financial Year87

3.1.9 Allocation and Distribution of Income

87

3.1.10 General Meetings

87

3.1.11 Disclosure of Holdings

89

3.1.12 Mandatory Disposal

90

3.1.13 Mandatory Offers

91

3.2 General Description of the Share Capital

92

3.2.1 Issued Share Capital

92

3.2.2 Authorised Share Capital

92

3.2.3 Modiﬁcation of Share Capital or Rights Attached to the Shares

92

3.2.4 Securities Granting Access to the Company’s Share Capital

93

3.2.5 Changes in the Issued Share Capital since Incorporation of the Company

94

3.3 Shareholdings and Voting Rights

96

3.3.1 Shareholding Structure at the end of 2014

96

3.3.2 Relationships with Principal Shareholders

97

3.3.3 Form of Shares

100

3.3.4 Changes in the Shareholding of the Company since its Incorporation

101

3.3.5 Persons Exercising Control over the Company

103

3.3.6 Simpliﬁed Group Structure Chart

103

3.3.7 Purchase by the Company of its Own Shares

105

3.4 Dividends

107

3.4.1 Dividends and Cash Distributions Paid Since the Incorporation of the Company

107

3.4.2 Dividend Policy of the Company

108

3.4.3 Unclaimed Dividends

108

3.4.4 Taxation

108

3.5 Annual Securities Disclosure Report109

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General Description of the Company and its Share Capital
3.1 General Description of the Company

3.1 General Description of the Company
3.1.1

Commercial and Corporate Names, Seat and Registered Ofﬁce

Commercial Name: Airbus Group

Seat (statutaire zetel): Amsterdam

Statutory Name: Airbus Group N.V.

Tel: +31 (0)71,5245,600

Registered Office: Mendelweg 30, 2333 CS Leiden,
the Netherlands

Fax: +31 (0)71,5232,807

3.1.2

Legal Form

The Company is a public limited liability company (naamloze vennootschap) organised under the laws of the Netherlands. As a company
operating worldwide, the Company is subject to, and operates under, the laws of each country in which it conducts business.

3.1.3

Governing Laws and Disclosures

The Company is governed by the laws of the Netherlands (inparticular Book 2 of the Dutch Civil Code) and by its Articles of
Association (the “Articles of Association”).
The Company is subject to various legal provisions of the Dutch
Financial Supervision Act (Wet op het financieel toezicht) (the“WFT”). In addition, given the fact that its shares are admitted for
trading on a regulated market in France, Germany and Spain, theCompany is subject to certain laws and regulations in these three
jurisdictions. A summary of the main regulations applicable to theCompany in relation to information to be made public in thesethree jurisdictions, as well as the Netherlands, is set out below.

3.1.3.1

Periodic Disclosure Obligations

Pursuant to Directive 2004 / 109 / EC on the harmonisation oftransparency requirements in relation to information about issuers
whose securities are admitted to trading on a regulated market(the “Transparency Directive”), the Company is required todisclose certain periodic and on-going information (the “RegulatedInformation”).
Pursuant to the Transparency Directive, the Company must
disseminate such Regulated Information throughout the European
Community in a manner ensuring fast access to such information
on a non-discriminatory basis. For this purpose, the Company may
use a professional service provider (wire). In addition, RegulatedInformation must be ﬁ led at the same time with the relevant
competent market authority. The Company must then ensurethat Regulated Information remains publicly available for at least
ﬁve years.

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Finally, Regulated Information must be made available for central
storage by a mechanism that is officially designated by theCompany’s home Member State.

Dutch Regulations
For the purpose of the Transparency Directive, supervision of theCompany is effected by the Member State in which it maintains
its corporate seat, which is the Netherlands. The competentmarket authority that assumes ﬁnal responsibility for supervisingcompliance by the Company in this respect is the AFM.
Under the Transparency Directive as implemented under Dutch
law, the Company is subject to a number of periodic disclosure
requirements, such as:
publishing an Annual Financial Report, together with an audit
report drawn up by the Statutory Auditors, within four months
after the end of each ﬁnancial year;■
publishing a semi-Annual Financial Report, within two months
after the end of the ﬁrst six months of the ﬁnancial year; and■publishing quarterly ﬁnancial reports, within a period between
ten weeks after the beginning and six weeks before the end of
the ﬁrst or second six-month period of the ﬁnancial year.
■

In addition, the Company must ﬁle with the AFM, within ﬁve days
following their adoption by the Company’s shareholders, its audited
annual ﬁ nancial statements (including the consolidated ones),
the management report, the Auditors’ report and other information
related to the ﬁnancial statements.

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3.1 General Description of the Company

The Company has also provided in this Registration Document a listof certain corporate and ﬁnancial documents and other informationthat it has published or made available to the public over the last
12 months and details of where these documents can be obtained(see “— 3.5 Annual Securities Disclosure Report”).

French Regulations
Since the Transparency Directive was implemented in France on
20 January 2007, the Company is no longer required to comply withcertain disclosure obligations pursuant to the general regulationsof the AMF.
In accordance with the requirement set forth in the Transparency
Directive to disseminate Regulated Information throughout theEuropean Community, the Company is required to provide
simultaneously in France the same information as that provided
abroad.

German Regulations
Since the Transparency Directive was implemented in Germany
on 20 January 2007, the Company is no longer required to comply
with certain disclosure obligations pursuant to the German Stock
Exchange Act (Börsengesetz) and the German Stock Exchange
Admissions Regulation (Börsenzulassungs-Verordnung).
Due to the listing of the Company’s shares in the Prime Standard
sub-segment of the Regulated Market (regulierter Markt) of theFrankfurt Stock Exchange, the Company is subject to certain
post-listing obligations as described below. The Company isincluded inter alia in the selection index MDAX, the MidCap indexof Deutsche Börse AG.
Pursuant to sections 50 and 51 of the Exchange Rules(Börsenordnung) of the Frankfurt Stock Exchange, the Company isrequired to publish consolidated annual and semi-annual ﬁnancial
statements as well as quarterly ﬁnancial reports, which may be
prepared in English only. In addition, pursuant to section 52 of the
Exchange Rules, the Company is required to publish a ﬁnancial
calendar at the beginning of each ﬁnancial year in German andEnglish. The Company is also required to hold an analysts’ meetingat least once per year in addition to the press conference regarding
the annual ﬁnancial statements.
Save for certain exceptions, pursuant to section 69 of the German
Stock Exchange Admissions Regulation, the Company has to apply
for admission of shares issued at a later date to the RegulatedMarket (regulierter Markt) of the Frankfurt Stock Exchange.

Spanish Regulations
Since the entering into force of the law and regulation implementing
the Transparency Directive in Spain in April and December 2007,
respectively, the Company is no longer required to comply withcertain disclosure obligations pursuant to the Spanish Securities
Act as developed by Royal Decree 1362 / 2007 of 19 October 2007.
In accordance with the requirement set forth in the Transparency
Directive to disseminate Regulated Information throughout theEuropean Community, the Company is required to provide
simultaneously in Spain the same information as that provided
abroad.

3.1.3.2

Ongoing Disclosure Obligations

Pursuant to the Transparency Directive, Regulated Information
includes in particular “inside information” as deﬁned pursuant to
Article 6 of Directive 2003 / 6 / EC on insider dealing and market
manipulation (the “Market Abuse Directive”). Such informationmust be disseminated throughout the European Community (seeintroduction to section “— 3.1.3.1 Periodic Disclosure Obligations”).
Inside information consists of information of a precise nature which
has not been made public that relates, directly or indirectly, to one
or more issuers of ﬁnancial instruments or to one or more ﬁnancial
instruments and which, if it were made public, would be likely tohave a signiﬁcant effect on the prices of those ﬁnancial instruments
or on the price of related derivative ﬁnancial instruments.
Inside information must be disclosed to the markets as soon as
possible. However, an issuer may under its own responsibility delay
the public disclosure of inside information so as not to prejudice
its legitimate interests provided that such omission would not belikely to mislead the public and provided that the issuer is able toensure the conﬁdentiality of that information.

Dutch Regulations

3

Following the implementation of the Transparency Directive
into Dutch law, the Company must publicly disclose RegulatedInformation and also ﬁle Regulated Information with the AFM, which
will keep all relevant Regulated Information in a publicly available
register. The Company will, whenever it discloses inside information
pursuant to applicable mandatory law as part of the RegulatedInformation, disclose and disseminate throughout the European
Community any such information.
Under Dutch law, the Company must also publish any change inthe rights attached to its shares, as well as any changes in therights attached to any rights issued by the Company to acquire
Airbus Group shares.

French Regulations
Any inside information as deﬁned above will be disclosed in France
by means of dissemination throughout the European Community,
as it is organised under Dutch law implementing the Transparency
Directive so as to provide simultaneously in France equivalent
information to that provided abroad.

German Regulations
Any inside information as deﬁ ned above will be disclosed inGermany by means of dissemination throughout the European
Community, as it is organised under Dutch law implementing theTransparency Directive so as to provide simultaneously in Germany
equivalent information to that provided abroad.

Spanish Regulations
Pursuant to Article 82 of the Spanish Securities Act, the Company
is required to make public, as soon as possible, any fact ordecision that may substantially affect the quotation of its shares(“a Relevant Event”). Any Relevant Event must be notiﬁ ed to
the CNMV simultaneously with its diffusion by any other means,as soon as the relevant fact is known, the relevant decision has

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General Description of the Company and its Share Capital
3.1 General Description of the Company

been made or, the relevant agreement has been executed, as thecase may be. The Company may, under its own responsibility,
delay the publication of any Relevant Event if it considers thatsuch publication damages its legitimate interests, provided thatsuch lack of publication does not mislead the public and that theCompany is in a position to guarantee the conﬁdentiality of therelevant information. Nonetheless, the Company will immediately
inform the CNMV should it decide to delay the publication of any
Relevant Event. Furthermore, pursuant to the Spanish Securities
Act, the Company must post details of any Relevant Event on
its website. The Company must try to ensure that the relevant
information is disclosed simultaneously to all types of investors
in the Member States of the European Union where it is listed.
An order dated 1 June 2009 requires that the Company appointat least one ofﬁcial spokesperson to respond to any inquiries that
the CNMV may have in relation to a Relevant Event disclosed by
the Company. This spokesperson must be able to ofﬁcially reply onbehalf of the Company and must have access to senior management
in order to verify any information requested by the CNMV.

3.1.4

A circular dated 4 November 2009 further provides thatthe publication of any Relevant Event must be made via the
CIFRADOC system (the CNMV’s electronic system for notiﬁcations
and communications) and that publication by different means
is only possible under exceptional circumstances, subject toapproval by the General Markets Directorate (Dirección Generalde Mercados).
Pursuant to the Spanish Securities rules and regulations, theCompany is also required:(i) to have a website which must contain as a minimum theinformation specified by Spanish regulations; and(ii) to make available to shareholders and file a Corporate
Governance Report with the CNMV in the Spanish language orin a language customary in the sphere of international financeon an annual basis.

Date of Incorporation and Duration of the Company

The Company was incorporated on 29 December 1998 for an unlimited duration.

3.1.5

Objects of the Company

Pursuant to its Articles of Association, the objects of the Company
are to hold, co-ordinate and manage participations or otherinterests and to ﬁnance and assume liabilities, provide for security

and/or guarantee debts of legal entities, partnerships, businessassociations and undertakings that are involved in:
■
■

3.1.6

the aeronautic, defence, space and/or communication industry; or
activities that are complementary, supportive or ancillary thereto.

Commercial and Companies Registry

The Company is registered with the Registry of the Chamber of Commerce (Handelsregister van de Kamer van Koophandel) under
number 24288945.

3.1.7

Inspection of Corporate Documents

The Articles of Association are available for inspection in Dutch at
the Chamber of Commerce.
In France, the Articles of Association are available at the operational
headquarters of Airbus Group (4, rue du Groupe d’Or, 31703
Blagnac, France, Tel.: +33 5 81 31 75 00).

86

In Germany, the Articles of Association are available at the Munichofﬁce of Airbus Group (Willy-Messerschmitt-Str. − Tor 1, 85521
Munich, Germany, Tel.: +49 89 60 70).
In Spain, the Articles of Association are available at the CNMV
and at the Madrid ofﬁce of Airbus Group (Avenida de Aragón 404,
28022 Madrid, Spain, Tel.: +34 91 585 70 00).

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General Description of the Company and its Share Capital
3.1 General Description of the Company

3.1.8

Financial YearThe ﬁnancial year of the Company starts on 1 January and ends on 31 December of each year.

3.1.9

Allocation and Distribution of Income

3.1.9.1

Dividends

The Board of Directors shall determine which part of the proﬁts
of the Company shall be attributed to reserves. The remaining
distributable proﬁt shall be at the disposal of the shareholders’meeting.
The shareholders’ meeting may resolve (if so proposed by the
Board of Directors) that all or part of a distribution on shares shallbe paid in Airbus Group shares or in the form of assets as opposed
to cash.
The declaration of a dividend, an interim dividend or another
distribution to the shareholders shall be made known to themwithin seven days after such declaration. Declared dividends,
interim dividends or other distributions shall be payable on suchdate(s) as determined by the Board of Directors.

Dividends, interim dividends and other distributions on shares shallbe paid by bank transfer to the bank or giro accounts designatedin writing to the Company by, or on behalf of, shareholders at thelatest 14 days after their announcement.
The persons entitled to a dividend, interim dividend or other
distribution shall be the shareholders as at a record date to be
determined by the Board of Directors for that purpose, which date
may not be a date prior to the date on which such dividend, interim
dividend or other distribution is declared.

3.1.9.2

Liquidation

3

In the event of the dissolution and liquidation of the Company,
the assets remaining after payment of all debts and liquidation
expenses shall be distributed amongst the holders of the sharesin proportion to their shareholdings.

3.1.10 General Meetings
3.1.10.1 Calling of Meetings
Shareholders’ Meetings are held as often as the Board of Directors
deems necessary, when required under Section 2:108a of the
Dutch Civil Code (as a result of a decrease of the Company’s equity
to or below half of the Company’s paid up and called up capital) or
upon the request of shareholders holding, individually or together,at least 10% of the total issued share capital of the Company. The
Annual General Meeting of Shareholders of the Company is held
within six months of the end of the ﬁnancial year.
The Board of Directors must give notice of shareholders’ meetings
through publication of a notice on the Company’s website(www.airbusgroup.com), which will be directly and permanently
accessible until the shareholders’ meeting. The Company mustcomply with the statutory rules providing for a minimum convening
period, which currently require at least 42 days of notice. The
convening notice must state the items required under Dutch law.
Shareholders’ Meetings are held in Amsterdam, The Hague,
Rotterdam or Haarlemmermeer (Schiphol Airport). The Board of
Directors may decide that shareholders’ meetings may be attended
by means of electronic or video communication devices from thelocations mentioned in the convening notice.

The Board of Directors must announce the date of the Annual
General Meeting of Shareholders at least ten weeks before theMeeting. A matter which one or more shareholders or other parties
with meeting rights collectively representing at least the statutory
threshold (which is currently 3% of the issued share capital) haverequested in writing to be put on the agenda for a General Meetingof Shareholders shall be included in the convening notice or shallbe announced in the same fashion, if the substantiated request
or a proposal for a resolution is received by the Company no later
than the 60th day before the general meeting. When exercising
the right to put a matter on the agenda for a General Meetingof Shareholders, the respective shareholder or shareholders are
obliged to disclose their full economic interest to the Company.
The Company must publish such disclosure on its website.
A request as referred to in the preceding paragraph may only bemade in writing. The Board of Directors can decide that in “writing”
is understood to include a request that is recorded electronically.

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General Description of the Company and its Share Capital
3.1 General Description of the Company

3.1.10.2 Right to Attend Shareholders’ Meetings
Each holder of one or more shares may attend shareholders’meetings, either in person or by written proxy, speak and voteaccording to the Articles of Association. See “— 3.1.10.4 Conditionsof Exercise of Right to Vote”. However, under (and subject to theterms of) the Articles of Association these rights may be suspended
under circumstances.
A shareholder or person who has the right to attend a meetingcan see to it that he is represented by more than one proxy holder,provided that only one proxy holder can be appointed for eachshare.
The persons who have the right to attend and vote at shareholders’meetings are those who are so on record in a register designatedfor that purpose by the Board of Directors on the registration
date referred to in Section 2:119 of the Dutch Civil Code which iscurrently the 28th day prior to the day of the shareholders’ meeting(the “Registration Date”), irrespective of who may be entitled tothe shares at the time of that meeting.
Any person who is entitled to exercise the rights set out in the above
paragraph (either in person or by means of a written proxy) andis attending the meeting from another location in such a mannerthat the person acting as Chairman of the meeting is convincedthat such a person is properly participating in the meeting, shallbe deemed to be present or represented at the meeting, shall beentitled to vote and shall be counted towards a quorum accordingly.
As a prerequisite to attending the shareholders’ meeting and to
casting votes, the Company, or alternatively an entity or person
so designated by the Company, should be notiﬁed in writing by
each holder of one or more shares and those who derive theaforementioned rights from these shares, not earlier than theRegistration Date, of the intention to attend the meeting. Ultimately
this notice must be received by the Company, or alternatively
an entity or person so designated by the Company, on the day
mentioned in the convening notice.
Holders of shares that are registered in the shareholders’ register
kept in Amsterdam have the option of holding them throughEuroclear France S.A. In this case the shares are registered in
the name of Euroclear France S.A.
Shareholders holding their Airbus Group shares hrough Euroclear
France S.A. who wish to attend general meetings will have to requestfrom their ﬁnancial intermediary or accountholder an admission
card and be given a proxy to this effect from Euroclear France S.A.
in accordance with the instructions speciﬁed by the Company in theconvening notice. For this purpose, a shareholder will also be able
to request that its shares be registered directly (and not throughEuroclear France S.A.) in the register of the Company. However,
only shares registered in the name of Euroclear France S.A. may
be traded on stock exchanges.
In order to exercise their voting rights, the shareholders will also be
able, by contacting their ﬁnancial intermediary or accountholder,to give their voting instructions to Euroclear France S.A. or to any

88other person designated for this purpose, as speciﬁ ed by theCompany in the convening notice.
Pursuant to its Articles of Association, the Board of Directors may
provide for electronic means of attendance, speaking and voting
at the shareholders’ meetings. The use of such electronic means
will depend on the availability of the necessary technical means
and market practice.

3.1.10.3 Majority and Quorum
All resolutions are adopted by means of a simple majority of thevotes cast except when a qualiﬁed majority is prescribed by the
Articles of Association or by Dutch law. No quorum is required
for any shareholders’ meeting to be held except as required
under applicable law for a very limited number of resolutions ofan extraordinary nature. Dutch law requires a special majority forthe passing of certain resolutions: inter alia, capital reduction,
exclusion of pre-emption rights in connection with share issues,
statutory mergers or statutory de-mergers; the passing of such
resolutions requires a majority of two-thirds of the votes cast if
50% of the share capital with voting rights is not present at theshareholders’ meeting (or otherwise a simple majority). In addition,
resolutions to amend the Articles of Association or to dissolve theCompany may only be adopted with a majority of at least two-thirdsof the valid votes cast at a shareholders’ meeting, whatever thequorum present at such meeting, and resolutions to amend certain
provisions of the Articles of Association may only be adopted witha majority of at least 75% of the valid votes cast at a shareholders’meeting, whatever the quorum present at such meeting.
Pledgees of shares and beneﬁciaries of a usufruct, which do nothave voting rights, do not have the right to attend and to speak atshareholders’ meetings. The owners of shares which are subject toa pledge or a usufruct, which do not have voting rights, are entitled
to attend and to speak at shareholders’ meetings.

3.1.10.4 Conditions of Exercise of Right to Vote
In all shareholders’ meetings, each shareholder has one vote inrespect of each share it holds. The major shareholders of theCompany – as set forth in “— 3.3.2 Relationships with Principal
Shareholders” – do not enjoy different voting rights from those of
the other shareholders.
A shareholder whose shares are subject to a pledge or usufruct
shall have the voting rights attaching to such shares unlessotherwise provided by law or by the Articles of Association or if,
in the case of a usufruct, the shareholder has granted voting rights
to the usufructuary. Pursuant to the Articles of Association andsubject to the prior consent of the Board of Directors, a pledgee ofshares in the Company may be granted the right to vote in respectof such pledged shares.
The Articles of Association provide: “The right to vote can be
granted to a usufructuary. The right to vote can be granted to apledgee, but only with the prior consent of the Board of Directors.

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No vote may be cast at the General Meeting on a share that is heldby the Company or a subsidiary; nor for a share in respect of which
one of them holds the depository receipts. Usufructuaries andpledgees of shares that are held by the Company or its subsidiaries

are, however, not excluded from their voting rights, in case theright of usufruct or pledge was vested before the share was heldby the Company or its subsidiary.”

3.1.11 Disclosure of Holdings
Pursuant to the WFT, any person who, directly or indirectly,
acquires or disposes of an interest in the capital or voting rightsof the Company must immediately give written notice to the AFM
by means of a standard form, if, as a result of such acquisition or
disposal, the percentage of capital interest or voting rights held bysuch person meets, exceeds or falls below the following thresholds:
3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75% and95%. Any person whose interest in the capital or voting rights of
the Company meets, exceeds or falls below one or several of theabove-mentioned thresholds due to a change in Airbus Group’s
outstanding capital, or in voting rights attached to the shares as
notiﬁed to the AFM by the Company, should notify the AFM nolater than the fourth trading day after the AFM has published thenotiﬁcation by the Company. Among other things, the Company
is required to notify the AFM immediately if its outstanding sharecapital or voting rights have changed by 1% or more since theCompany’s previous notiﬁcation.
If at the end of a calendar year the composition of a shareholder’sholding differs from its previous disclosure as a result of theconversion of certain types of securities or following the exerciseof rights to acquire voting rights, this shareholder must then provide
an update of its previous disclosure within four weeks of the end ofeach calendar year by giving written notice thereof to the AFM. The
disclosures are published by the AFM on its website (www.afm.nl).
Pursuant to the Articles of Association, shareholders must notify
the Company when meeting or crossing the thresholds above.
The Articles of Association also contain disclosure obligations forshareholders that apply when their interests in the Company reachor cross certain thresholds.
Under the Articles of Association, the disclosure obligationsof shareholders are enhanced in several ways beyond what isrequired under the WFT, including by requiring the disclosure ofadditional information, tying the disclosure obligations to a broader
range of interests in the capital or voting rights of the Company
and by requiring a shareholder to notify the Company if his or herinterest reaches, exceeds or falls below the Mandatory Disposal
Threshold (as deﬁned below) or if the interest of a shareholder(alone or a member of a concert) which is above such Mandatory
Disposal Threshold charges in its composition, nature and/or size.
Failure to comply with the legal obligation to notify a change inshareholding under the WFT is a criminal offence punishable bycriminal and administrative penalties as well as civil law penalties,

including the suspension of voting rights. Failure to comply witha notiﬁ cation under the Articles of Association can lead to asuspension of meeting and voting rights.

Disclosure Requirements for Members of the Boardof Directors and the Executive Committee
Disclosure of Holdings
In addition to the requirements under the WFT regarding thedisclosure of holdings in case the speciﬁed thresholds are met or
exceeded or if holdings fall below these thresholds, Members of theBoard of Directors must report to the AFM the number of shares in
the Company and attached voting rights(1) held by him or an entity
controlled by him, within two weeks following his appointment as
Director, whether or not such shareholdings meet or exceed any of
the speciﬁed thresholds. Subsequently, any Member of the Boardof Directors is required to notify the AFM of any changes in such
number of shares in the Company and attached voting rights.

3

Disclosure of Transactions Carried Out
on Any Securities Issued by the Company
Based on Section 5:60 of the WFT, certain persons discharging
managerial or supervisory responsibilities within the Company and,
where applicable, persons closely associated with them (together“Insiders”, as deﬁned below), are required to notify the AFM within
ﬁve trading days of all transactions conducted for their own accountinvolving shares of the Company, or derivatives or other ﬁnancial
instruments related to such shares, unless the aggregate amountof such transactions does not exceed € 5,000 in respect of alltransactions in a calendar year.
“Insiders” for the Company include (i) Members of the Boardof Directors and the Executive Committee of the Company,(ii) persons closely associated with any person mentioned undercategory (i) (including their spouses, life partners or any partner
considered by national law as equivalent to the spouse, blood
relatives, dependent children and other relatives who have shared
the same household), and (iii) legal entities, trusts or partnerships
whose managerial responsibilities are discharged by any personreferred to in categories (i) or (ii) or which are directly or indirectly
controlled by such a person, or that have been set up for the beneﬁtof such a person, or whose economic interests are substantiallyequivalent to those of such a person.

(1) In this context, the term “shares” also includes for example depositary receipts for shares and rights resulting from an agreement to acquire shares or depositary receipts forshares, speciﬁcally call options, warrants, and convertible bonds. Equally, the term “voting rights” also includes actual or contingent rights to voting rights (e.g., embedded
in call options, warrants or convertible bonds).

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General Description of the Company and its Share Capital
3.1 General Description of the Company

The Company has adopted speciﬁc internal insider trading rules(the “Insider Trading Rules”) in order to ensure compliance withthe above requirements and with other share trading regulations
applicable in the Netherlands, France, Germany and Spain. The
Insider Trading Rules are available on the Company’s website,and provide in particular that: (i) all employees and Directors areprohibited from conducting transactions in the Company’s sharesor stock options if they have inside information, and (ii) certain
persons are only allowed to trade in the Company’s shares or stock
options within very limited periods and have speciﬁc information
obligations to the ITR Compliance Ofﬁcer of the Company andthe competent ﬁnancial market authorities with respect to certaintransactions. The ITR Compliance Ofﬁcer is responsible for the
implementation of the Insider Trading Rules and for reporting to
the AFM.
Pursuant to Section 5:59 paragraph of the WFT, the Company
must maintain a list of all persons working for it by virtue of alabour relationship or otherwise, who may have access to inside

information. Equivalent requirements exist under French, German
and Spanish law.
According to paragraph 15a of the German Securities Trading
Act, persons with signiﬁcant managerial responsibility within the
Company (i.e. for the Company, the Members of the Board of
Directors and of the Executive Committee), or the persons closely
associated with them, must disclose transactions conducted fortheir own account involving shares of the Company or ﬁnancial
instruments that relate to those shares, especially derivatives.
These persons have to notify the Company and the German
Federal Financial Supervisory Authority of the transactions within
ﬁve trading days unless the aggregate amount of such transactions
does not exceed € 5,000 in respect of all transactions in a calendar
year. Since implementation of the Transparency Directive into
German law on 20 January 2007, the Company is no longer
required to publish such notiﬁcations on its website or in a German
supra-regional mandatory stock exchange newspaper.

3.1.12 Mandatory Disposal
3.1.12.1 Mandatory Disposal Threshold Restricting Ownership to 15%
The Articles of Association prohibit any shareholder from holding aninterest of more than 15% of the share capital or voting rights of theCompany, acting alone or in concert with others (the “Mandatory
Disposal Threshold”). An interest (“Interest”) includes not only
shares and voting rights, but also other instruments that cause
shares or voting rights to be deemed to be at someone’s disposal
pursuant to the Dutch Financial Supervision Act, and must be
notiﬁed to the Dutch regulator, the AFM, if certain thresholds arereached or crossed. Any shareholder having an interest of morethan the Mandatory Disposal Threshold must reduce its interest
below the Mandatory Disposal Threshold, for instance by disposingof its Excess Shares, within two weeks. The same applies toconcerts of shareholders and other persons who together holdan interest exceeding the Mandatory Disposal Threshold. Shouldsuch shareholder or concert not comply with not exceeding the
15% Mandatory Disposal Threshold by the end of such two-weekperiod, their Excess Shares would be transferred to a Dutch law
foundation (“Stichting”), which can, and eventually must, disposeof them.
The Dutch law foundation would issue depositary receipts to therelevant shareholder in return for the Excess Shares transferredto the foundation, which would entitle the relevant shareholder tothe economic rights, but not the voting rights, attached to such
Airbus Group shares. The foundation’s Articles of Association andthe terms of administration governing the relationship between
the foundation and the depositary receipt holders provide, interalia, that:■90

the Board Members of the foundation must be independent fromthe Company, any grandfathered persons and their afﬁliates (see“— 3.1.12.2 Exemptions from Mandatory Disposal Threshold”)
and any holder of depositary receipts and their afﬁliates (there
is an agreement under which the Company will, inter alia, cover

the foundation’s expenses and indemnify the Board Members
against liability);■
the Board Members are appointed (except for the initial Board
Members who were appointed at incorporation) and dismissedby the Management Board of the foundation (the Company may
however appoint one Board Member in a situation where there
are no foundation Board Members);■
the foundation has no discretion as to the exercise of voting
rights attached to any Airbus Group shares held by it and will ina mechanical manner vote to reﬂect the outcome of the votes
cast (or not cast) by the other shareholders, and the foundation
will distribute any dividends or other distributions it receives fromthe Company to the holders of depositary receipts; and■no transfer of a depositary receipt can be made without the priorwritten approval of the foundation’s board.
For any shareholder or concert, the term “Excess Shares”, asused above, refers to such number of shares comprised in theinterest of such shareholder or concert exceeding the Mandatory
Disposal Threshold which is the lesser of: (a) the shares held bysuch shareholder or concert which represent a percentage of theCompany’s issued share capital that is equal to the percentage
with which the foregoing interest exceeds the Mandatory Disposal
Threshold; and (b) all shares held by such person or concert.
This restriction is included in the Articles of Association to reﬂect
the Company’s further normalised governance going forward
aiming at a substantial increase of the free ﬂoat and to safeguard
the interests of the Company and its stakeholders (including all its
shareholders), by limiting the possibilities of inﬂuence above thelevel of the Mandatory Disposal Threshold or takeovers other thana public takeover offer resulting in a minimum acceptance of 80%of the share capital referred to below.

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General Description of the Company and its Share Capital
3.1 General Description of the Company

3.1.12.2 Exemptions from Mandatory Disposal Threshold
The restrictions pursuant to the Mandatory Disposal Thresholdunder the Articles of Association do not apply to a person who hasmade a public offer with at least an 80% acceptance (including
any Airbus Group shares already held by such person). These
restrictions also have certain grandfathering exemptions for the
beneﬁt of shareholders and concerts holding interests exceeding
the Mandatory Disposal Threshold on the date that the current
Articles of Association entered into force (the “Exemption Date”).
Different grandfathering regimes apply to such shareholders andconcerts depending on the interests and the nature thereof heldby each such shareholder or concert on the Exemption Date.

The Company has conﬁrmed that (i) the speciﬁc exemption in
Article 16.1.b of the Articles of Association applies to Sogepa, as
it held more than 15% of the outstanding Company voting rights
and shares including the legal and economic ownership thereof on
the Exemption Date and (ii) the speciﬁc exemption in Article 16.1.c
applies to the concert among Sogepa, GZBV and SEPI, as theyheld more than 15% of the outstanding Company voting rights
and shares including the legal and economic ownership thereofon the Exemption Date.

3.1.13 Mandatory Offers
3.1.13.1 Takeover Directive
The Directive 2004 / 25 / EC on takeover bids (the “Takeover
Directive”) sets forth the principles governing the allocation of laws
applicable to the Company in the context of a takeover bid for theshares of the Company. The Takeover Directive refers to the rules of
the Netherlands and the rules of the European Union Member Stateof the competent authority that must be chosen by the Company
from among the various market authorities supervising the markets
where its shares are listed.
For the Company, matters relating to, inter alia, the consideration
offered in the case of a bid, in particular the price, and mattersrelating to the bid procedure, in particular the information on theofferor’s decision to make a bid, the contents of the offer document
and the disclosure of the bid, shall be determined by the laws of
the European Union Member State having the competent authority,
which will be selected by the Company at a future date.
Matters relating to the information to be provided to the employeesof the Company and matters relating to company law, in particular
the percentage of voting rights which confers control and any
derogation from the obligation to launch a bid, the conditions underwhich the Board of Directors of the Company may undertake any
action which might result in the frustration of the bid, the applicable
rules and the competent authority will be governed by Dutch law(see “— 3.1.13.2 Dutch Law”).

3.1.13.2 Dutch Law
The bill implementing the Takeover Directive (the “Takeover Act”)
in Dutch Law entered into force on 28 October 2007. In accordancewith the Takeover Act, shareholders are required to make anunconditional public offer for all issued and outstanding sharesin the Company’s share capital if they — individually or acting
in concert (as such term is deﬁned below), directly or indirectly— have 30% or more of the voting rights (signiﬁcant control) in
the Company. In addition to the other available exemptions listed
below, the requirement to make a public offer does not apply
to persons, who at the time the Takeover Act came into force,

already held – individually or acting in concert – 30% or more of
the voting rights in the Company. In the case of such a concert, a
new Member of the concert can be exempted if it satisﬁes certain
conditions.

3

Under the Takeover Act, natural persons, legal entities orcompanies are “acting in concert” if they cooperate on the basisof an agreement with the objective to acquire signiﬁcant control(as deﬁned above) in the target company, or if they cooperate withthe target company with the objective to prevent the success ofan announced public offer for the shares in such target company.
The following categories of natural persons, legal entities orcompanies are in any event deemed to be “acting in concert”
under the Takeover Act: (i) legal entities or companies that form agroup of companies as deﬁned in section 2:24b of the Dutch Civil
Code, (ii) legal entities or companies and their subsidiaries, and(iii) natural persons and their subsidiary companies.
In addition to the exemption stated above, the obligation to makea public offer does not apply to the natural person, legal entity orcompany that, amongst others:
acquires signiﬁcant control as a result of declaring unconditional(gestand doen) a public offer made for all shares (or depositary
receipts) in the target company, provided that the bidder as aconsequence can exercise more than 50% of the votes at thetarget company’s shareholders’ meeting;■is a legal entity, independent from the target company, that
acquires significant control after a public offer has beenannounced by a third party, provided that such entity (i) holds
the shares in the target company for a maximum period of two
years and for purposes of protection of the target company
and (ii) the corporate objects of such entity are to preserve theinterests of the target company;■
is a legal entity, independent from the target company, which has
issued depositary receipts for the shares in the target company
with the cooperation of such target company;■
acquires signiﬁ cant control as a result of: (i) an intra-grouptransfer of the shares representing signiﬁcant control; or (ii) atransfer between a parent company and its subsidiary;■

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capitalacquires signiﬁcant control acting in concert with one or moreother natural persons, legal entities or companies, in which casethe obligation to make a public offer lies with the natural person,
legal entity or company that can exercise most of the voting
rights in the shareholders’ meeting of the target company; or■acts as a custodian (if and to the extent it cannot exercise any
voting rights in its sole discretion).
■

The obligation to make a public offer also does not apply if,amongst others:■

the natural person, legal entity or company, after acquiring
signiﬁcant control, loses such control within a thirty day grace
period (which may be extended by the Enterprise Chamber of
the Court of Appeals in Amsterdam court to ninety days in total),
unless (i) loss of control is due to a transfer to a natural person,

legal entity or company to which one of the exemptions set out
above applies, or (ii) the acquirer of the signiﬁcant control has
exercised its voting rights during the grace period; or■the target company’s shareholders’ meeting agrees upfront withthe acquisition of signiﬁcant control — and any subsequentacquisition of shares — by a third party with 90% of votes castin favour of such proposal, excluding any votes by such third
party and any of its concert parties.
Under the Takeover Act, a minority shareholder may also make arequest for his shares to be purchased by an offeror who holds
at least 95% of the issued share capital and the voting rights. This
claim must be brought before the Enterprise Chamber of the Courtof Appeals in Amsterdam within the three-month period after theclosing of the acceptance period of the public offer.

3.2 General Description of the Share Capital
3.2.1

Issued Share Capital

As of 31 December 2014, the Company’s issued share capital amounted to € 784,780,585, consisting of 784,780,585 fully paid-up
shares of a nominal value of € 1 each.

3.2.2 Authorised Share Capital
As of 31 December 2014, the Company’s authorised share capital amounted to € 3 billion, consisting of 3,000,000,000 shares of € 1 each.

3.2.3 Modiﬁcation of Share Capital or Rights Attached to the Shares
Unless such right is limited or excluded by the shareholders’meeting (or the Board of Directors, if authorised by the shareholders’meeting to do so) as described below, holders of shares havea pre-emptive right to subscribe for any newly issued sharesin proportion to the aggregate nominal value of shares held by
them, except for shares issued for consideration other than cash
and shares issued to employees of the Company or of a Group
company. For the contractual position as to pre-emption rights,
see “— 3.3.2 Relationships with Principal Shareholders”.
The shareholders’ meeting has the power to authorize the issuanceof shares. The shareholders’ meeting may also authorise the Boardof Directors for a period of no more than ﬁve years, to issue sharesand to determine the terms and conditions of share issuances.

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The shareholders’ meeting also has the power to limit or to exclude
pre-emption rights in connection with new issues of shares, andmay authorise the Board of Directors for a period of no more thanﬁve years, to limit or to exclude pre-emption rights. All resolutions inthis context must be approved by a two-thirds majority of the votes
cast during the shareholders’ meeting in the case where less thanhalf of the capital issued is present or represented at said meeting.
However, the Articles of Association provide that a 75% voting
majority is required for any shareholders’ resolution to issue sharesor to grant rights to subscribe for shares if the aggregate issue
price is in excess of € 500,000,000 per share issuance, and nopreferential subscription rights exist in respect thereof. The same
voting majority requirement applies if the shareholders’ meeting
wishes to designate the Board of Directors to have the authority
to resolve on such share issuance or granting of rights.

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capital

Pursuant to the existing shareholders’ resolutions adopted at theAGM held on 27 May 2014, the powers to issue shares and to grantrights to subscribe for shares which are part of the Company’s
authorised share capital and to limit or exclude preferential
subscription rights for existing shareholders have been delegatedto the Board of Directors for the purpose of:
1. employee share ownership plans and share related LongTerm Incentive Plans (such as stock option, performance andrestricted share plans), provided that such powers shall belimited to 0.2% of the Company’s authorised share capital,
and
2. funding the Company and its Group companies, provided
that such powers shall be limited to 0.3% of the Company’s
authorised share capital.
Such powers have been granted for a period expiring at the AGM
to be held on 27 May 2015, and shall not extent to issuing sharesor granting rights to subscribe for shares (i) if there is no preferential
subscription right (by virtue of Dutch law, or because it has been
excluded by means of a resolution of the competent corporatebody) and (ii) for an aggregate issue price in excess of € 500 million
per share issuance.
The shareholders’ meeting will be requested in the AGM to beheld on 27 May 2015 to delegate to the Board of Directors thepowers to issue shares and to grant rights to subscribe for sharesin the Company’s share capital and to limit or exclude preferential
subscription rights, provided that such powers shall be:
1. limited to an aggregate of 0.1% of the Company’s authorised
capital from time to time for the purpose of employee shareownership plans, and2. limited to an aggregate of 0.3% of the Company’s authorised
capital from time to time for the purpose of financing the Group.
Such powers shall not extend to issuing shares or granting rights
to subscribe for shares (i) if there is no preferential subscription
right (by virtue of Dutch law, or because it has been excluded bymeans of a resolution of the competent corporate body) and (ii)for an aggregate issue price in excess of € 500 million per shareissuance. The shareholder’s meeting will be requested to grantsuch powers for a period expiring at the AGM to be held in 2016.
At the AGM held on 27 May 2014, the Board of Directors was
authorised, for a period of 18 months from the date of such AGM,
to repurchase shares of the Company, by any means, including
derivative products, on any stock exchange or otherwise, as longas, upon such repurchase, the Company would not hold more than
10% of the Company’s issued share capital. The shareholders’meeting will be requested to renew those powers for a period of
18 months in the AGM to be held on 27 May 2015. This authorisation
will supersede and replace the authorisation granted by the AGM
on 27 May 2014.
The shareholders’ meeting may reduce the issued share capitalby cancellation of shares, or by reducing the nominal value of theshares by means of an amendment to the Articles of Association.
The cancellation of shares requires the approval of a two-thirds
majority of the votes cast during the shareholders’ meeting in
the case where less than half of the capital issued is present or
represented at said meeting; the reduction of nominal value bymeans of an amendment to the Articles of Association requires
the approval of a two-thirds majority of the votes cast during theshareholders’ meeting (unless the amendment to the Articles of
Association also concerns an amendment which under the Articles
of Association requires a 75% voting majority).

3

3.2.4 Securities Granting Access to the Company’s Share Capital
Except for stock options granted for the subscription of Airbus Group shares (See “— Corporate Governance — 4.3.3 Long-Term
Incentive Plans” and “Notes to the Consolidated Financial Statements (“IFRS”) — Note 35: Share-Based Payment”), there are no
securities that give access, immediately or over time, to the share capital of the Company.
The table below shows the total potential dilution that would occur if all the stock options issued as of 31 December 2014 were exercised:

Total number of Company shares issued as of 31 December 2014
Total number of Company shares which may be issued
following exercise of stock options

Total potential Company share capital

Number ofsharesPercentage ofdiluted capital

Number of
voting rights

Percentage ofdiluted voting
rights(1)784,780,585

99,715%784,348,753

99,715%2,240,891

0,285%

2,240,891

0,285%

787,021,476

100%

786,589,644

100%(1) The potential dilutive effect on capital and voting rights of the exercise of these stock options may be limited as a result of the Company’s share purchase programmes
and in the case of subsequent cancellation of repurchased shares. See “— 3.3.7.1 Dutch law and information on share repurchase programmes”.

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capital

3.2.5 Changes in the Issued Share Capital since Incorporation of the Company

Date

Nominalvalue pershare

Nature of Transaction

29 December 1998 Incorporation

Numberof shares
issued /cancelled

Premium(1)Total number
of issued
shares after
transaction

Total issued
capital after
transaction

NLG 1,000

100

-

100

NLG 100,000

3 April 2000

Conversion into €€1

50,000-50,000€ 50,000

8 July 2000

Issue of shares in exchange forcontributions by Aerospatiale Matra,
DASA AG and SEPI

€1715,003,828€ 1,511,477,044

715,053,828€ 715,053,828

13 July 2000

Issue of shares for the purpose of the initialpublic offering and listing of the Company€1

80,334,580€ 1,365,687,860

795,388,408€ 795,388,408

Issue of shares for the purpose of
the employee offering carried out
in the context of the initial public offering
21 September 2000 and listing of the Company€1

11,769,259€ 168,300,403

807,157,667€ 807,157,667

5 December 2001

Issue of shares for the purpose ofan employee offering (Note d’opération
approved by the COB(2) on 13 October 2001
under number 01-1209)€1

2,017,894€ 19,573,571.80

809,175,561€ 809,175,561

4 December 2002

Issue of shares for the purpose ofan employee offering (Note d’opération
approved by the COB on 11 October 2002
under number 02-1081)€1

2,022,939€ 14,470,149.33

811,198,500€ 811,198,500

5 December 2003

Issue of shares for the purpose ofan employee offering (Note d’opération
approved by the COB on 25 September
2003 under number 03-836)€1

1,686,682€ 19,363,109.36

812,885,182€ 812,885,182

20 July 2004

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 6 May 2004

€1

5,686,682-

807,198,500€ 807,198,500

3 December 2004

Issue of shares for the purpose ofan employee offering (Note d’opération
approved by the AMF on 10 September
2004 under number 04-755)€12,017,822€ 34,302,974

809,216,322€ 809,216,322

In 2004

Issue of shares following exercise
of options granted to employees(3)€1362,747€ 6,133,436

809,579,069€ 809,579,069

25 July 2005

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 11 May 2005

€1

1,336,358-

808,242,711€ 808,242,711

29 July 2005

Issue of shares for the purpose ofan employee offering (Note d’opération
approved by the AMF on 4 May 2005
under number 05-353)€1

1,938,309€ 34,618,198.74

810,181,020€ 810,181,020

In 2005

Issue of shares following exercise of options
granted to employees(3)€17,562,110€ 144,176,031.61

817,743,130€ 817,743,130

20 July 2006

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 4 May 2006

€1

6,656,970-

811,086,160€ 811,086,160

In 2006

Issue of shares following exercise of options
granted to employees(3)€14,845,364€ 89,624,589

815,931,524€ 815,931,524

In 2007

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 4 May 2007

€1

4,568,405-

811,363,119€ 811,363,119

9 May 2007

Issue of shares for the purposeof an employee offering€12,037,835€ 33,482,173

813,400,954€ 813,400,954

In 2007

Issue of shares following exercise of options
granted to employees(3)€1613,519€ 9,438,683

814,014,473€ 814,014,473(1) The costs (net of taxes) related to the initial public offering of the shares of the Company in July 2000 have been offset against share premium for an amount of € 55,849,772.
(2) Predecessor of the AMF.
(3) For information on stock option plans under which these options were granted to the Company’s employees, see “— Corporate Governance — 4.3.3 Long-Term Incentive Plans”.

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General Description of the Company and its Share Capital
3.2 General Description of the Share Capital

Nominalvalue pershare

Numberof shares
issued /cancelled

Premium(1)Total number
of issued
shares after
transaction

Total issued
capital after
transaction

Date

Nature of Transaction

In 2008

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 26 May 2008

€1

1,291,381-

812,723,092€ 812,723,092

25 July 2008

Issue of shares for the purposeof an employee offering€12,031,820€ 22,084,500

814,754,912€ 814,754,912

In 2008

Issue of shares following exercise of options
granted to employees(3)€114,200€ 208,030

814,769,112€ 814,769,112

31 July 2009

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 27 May 2009€1

22,987-814,746,125€ 814,746,125

Issue of shares for the purpose
18 December 2009 of an employee offering€1

1,358,936€ 13,263,215

816,105,061€ 816,105,061

In 2010Issue of shares following exercise
of options granted to employees(3)€1297,661€ 4,477,168

816,402,722€ 816,402,722

29 July 2011

Issue of shares for the purposeof an employee offering€12,445,527€ 34,602,580

818,848,249€ 818,848,249

9 August 2011

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 26 May 2011

€1

78,850-818,769,399€ 818,769,399

In 2011

Issue of shares following exercise
of options granted to employees(3)€11,712,892€ 25,995,005

820,482,291€ 820,482,291

30 July 2012

Issue of shares for the purposeof an employee offering€12,177,103€ 38,084,482

822,659,394€ 822,659,394

8 August 2012

Cancellation of shares upon authorisation
granted by the Annual Shareholders’Meeting held on 31 May 2012

€1

553,233-

822,106,161€ 822,106,161

In 2012

Issue of shares following exercise
of options granted to employees(3)€15,261,784€ 98,893,293

827,367,945€ 827,367,945

20 June 2013

Cancellation of shares upon authorisation
granted by the Extraordinary General
Meeting held on 27 March 2013

€1

47,648,691-

779,719,254€ 779,719,254

29 July 2013

Issue of shares for the purposeof an employee offering€12,113,245€ 57,580,650

781,832,499€ 781,832,499

Cancellation of shares upon authorisation
granted by the Extraordinary General
27 September 2013 Meeting held on 27 March 2013

€1

3,099,657-

778,732,842€ 778,732,842

Cancellation of shares upon authorisation
granted by the Annual Shareholders’
27 September 2013 Meeting held on 29 May 2013

€1

2,448,884-

776,283,958€ 776,283,958

In 2013

Issue of shares following exercise
of options granted to employees(3)€16,873,677€ 176,017,918

783,157,635€ 783,157,635

In 2014Issue of shares following exercise
of options granted to employees(3)€11,871,419€ 50,619,684

784,780,585€ 784,780,585

3(1) The costs (net of taxes) related to the initial public offering of the shares of the Company in July 2000 have been offset against share premium for an amount of € 55,849,772.
(2) Predecessor of the AMF.
(3) For information on stock option plans under which these options were granted to the Company’s employees, see “— Corporate Governance — 4.3.3 Long-Term Incentive Plans”.

In 2014, the Group’s employees exercised 1,871,419 stock options granted to them through the stock option plans launched by theCompany. As a result, 1,871,419 new shares were issued in the course of 2014.
248,469 treasury shares were cancelled in 2014.
During 2014, the Company repurchased in aggregate 191,476 shares.

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3.3 Shareholdings and Voting Rights

3.3 Shareholdings and Voting Rights
3.3.1

Shareholding Structure at the end of 2014

On 16 January 2014, the République Française (the “French
State”) announced it sold through Sogepa around 8,000,000
Company shares (approximately 1% of the outstanding Company
shares) in line with a bilateral agreement between the French
and German States which provides that the German State shall
increase its voting rights in the Company to 11% and the French
State shall reduce its voting rights to the same level. Following thistransaction, the French State through Sogepa, the German Statethrough GZBV and the Spanish State through SEPI jointly remain
the major shareholders of the Company, with a minimum of 26%of the voting rights.
As of 31 December 2014, the French State held 10.94% of theoutstanding Company shares through Société de Gestion deParticipations Aéronautiques (“Sogepa”), the German State

held 10.92% through Gesellschaft zur Beteiligungsverwaltung
GZBV mbH & Co. KG (“GZBV”), a subsidiary of Kreditanstalt fürWiederaufbau (“KfW”), a public law institution serving domestic
and international policy objectives of the Government of the Federal
Republic of Germany, and the Spanish State held 4.12% throughSociedad Estatal de Participaciones Industriales (“SEPI”). The
public (including the Group’s employees) and the Company held,
respectively, 73.97% and 0.05% of the Company’s share capital.
The diagram below shows the ownership structure of the Company
as of 31 December 2014 (% of capital and of voting rights (inparentheses) before exercise of outstanding stock options granted
for the subscription of Airbus Group shares). See “— Corporate
Governance — 4.3.3 Long-Term Incentive Plans”.

OWNERSHIP STRUCTURE OF AIRBUS GROUP N.V. AS OF 31 DECEMBER 2014

FRENCHSTATEGERMANSTATE

SPANISHSTATEOTHER GERMAN
PUBLIC ENTITIES

15.69%

KfW

84.31%

SOGEPA

SEPI

GZBV

10.94%(10.94%)4.12%(4.12%)

10.92%(10.93%)

Share subject to New Shareholders’ Agreement

AIRBUS GROUP N.V.

(1) Including shares held by the Company itself (0.05%).

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In addition, the below listed entities have notiﬁed the AFM of theirsubstantial interest in the Company as of 31 December 2014.
For further details, please refer to the website of the AFM at:
www.afm.nl:
BlackRock, Inc. (4.20% of the capital interest and 4.99% of thevoting rights);■
Capital Group International Inc. (5.07% of the voting rights); and■Capital Research and Management Company (5.07% of thevoting rights).
■

indirectly more than 50% of the share capital, 431,832 of its own
shares, equal to 0.5% of issued share capital. The treasury shares
owned by the Company do not carry voting rights.
For the number of shares and voting rights held by Members of theBoard of Directors and Executive Committee, see “— Corporate
Governance — 4.2.1 Remuneration Policy”.
Approximately 2.1% of the share capital (and voting rights) was heldby the Company’s employees as of 31 December 2014.

As of 31 December 2014, the Company held, directly or indirectly
through another company in which the Company holds directly or

3.3.2 Relationships with Principal Shareholders
On 5 December 2012, the Company, its then-core shareholders— Daimler AG (“Daimler”), Daimler Aerospace AG (“DASA”),
Société de Gestion de l’Aéronautique, de la Défense et de l’Espace(“Sogeade”), Lagardère SCA (“Lagardère”), Société de Gestion
de Participations Aéronautiques (“Sogepa”) and Sociedad Estatal
de Participaciones Industriales (“SEPI”) — and Kreditanstalt fürWiederaufbau (“KfW”), a public law institution serving domestic
and international policy objectives of the Government of the Federal
Republic of Germany, reached an agreement (the “Multiparty
Agreement”) on far-reaching changes to the Company’s
shareholding structure and governance. The Multiparty Agreement
was aimed at further normalising and simplifying the governance of
the Company while securing a shareholding structure that allowed
France, Germany and Spain to protect their legitimate strategicinterests. This represented a major step forward in the evolutionof the governance of the Company.
The Multiparty Agreement provided for signiﬁcant changes to theCompany’s shareholding structure. In addition, a series of relatedtransactions (collectively referred to as the “Consummation”)
occurred shortly after the Extraordinary General Meeting of theshareholders held on 27 March 2013. This resulted in several
changes in the governance of the Company, including changes
in the composition of the Board of Directors and its internal rules, aswell as amendments to the Articles of Association of the Company.
The participation agreement among the Company’s former coreshareholders, as at 31 December 2012 including KfW, wasterminated and replaced in part by a more limited shareholders’agreement (the “New Shareholders’ Agreement”) among only
Gesellschaft zur Beteiligungsverwaltung GZBV mbH & Co. KG(“GZBV”), a subsidiary of KfW, Sogepa and SEPI.
The New Shareholders’ Agreement does not give the parties
to it any rights to designate Members of the Board of Directors
or management team or to participate in the governance of theCompany. Finally, the Multiparty Agreement provided for the entry
into state security agreements with each of the French State andGerman State, which will be described in more detail below, andcertain further undertakings of the Company with respect toselected matters that affect the interests of the Current Consortium
Members.

3.3.2.1

Changes to Shareholding Structure

In a transaction contemplated by the Multiparty Agreement, on
6 December 2012, Daimler sold 61.1 million EADS N.V. shares(approximately 7.44% of the outstanding EADS N.V. shares) throughan accelerated book building transaction (the “ABB”). This reduced
Daimler’s economic interest in the Company to approximately
7.44% and its voting interest to 14.88%. KfW acquired 2.76% of
the outstanding EADS N.V. shares as part of the ABB. In a second
transaction, KfW acquired (through a wholly owned subsidiary)
65% of the shares in a consortium of private and public-sector
investors (“Dedalus”) on 2 January 2013, which brought its stakein Dedalus to 78%. The remaining 22% is held by certain other
German public entities. Dedalus held an economic interest of
7.44% in the Company as of the time of this acquisition. As a resultof these two transactions, KfW held a voting interest of 2.76% in
the Company and an economic interest of 8.56% in the Company– 2.76% directly and 5.80% via Dedalus. The other German public
entities participating in Dedalus held a 1.64% economic interestin the Company via Dedalus. The joint economic interest of KfW
and such German public entities in the Company was thus 10.2%
immediately following these acquisitions. On 4 April 2013, SEPI
sold 9,560,000 Company shares (approximately 1.15% of theoutstanding Company shares). On 9 April 2013, Lagardère sold its
remaining 61,000,000 Company shares (approximately 7.4% of theoutstanding Company shares). On 17 April 2013, the French Statesold through Sogepa 12,977,088 Company shares (approximately
1.56% of the outstanding Company shares) and Daimler sold its
remaining 61,100,000 Company shares (approximately 7.5% of
the outstanding Company shares). On 26 April 2013 the French
State sold another 17,451,000 Company shares (approximately
2.1% of the outstanding Company shares). On 31 July 2013SEPI sold another 2,802,450 Company shares (approximately
0.36% of the outstanding Company shares). On 30 December
2013 GZBV bought 1,872,072 Company shares (approximately
0.24% of the outstanding Company shares). The aforementioned
transactions ultimately led to the French State holding 11.99% of
the outstanding Company shares through Sogepa, the German
State holding 10.94% through GZBV and the Spanish State holding
4.13% through SEPI as of 31 December 2013. For more recent
developments see section 3.3.4 below.

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3.3.2.2

New Corporate Governance Arrangements

After the Consummation, the corporate governance arrangementsof the Company were substantially changed. These changes
are intended to further normalise and simplify the Company’s
corporate governance, reﬂecting an emphasis on best corporate
governance practices and the absence of a controlling shareholder
group. Certain changes to the Company’s corporate governancearrangements were provided for in the Articles of Association,
including (i) disclosure obligations for shareholders that apply when
their interests in the Company reach or cross certain thresholds
and (ii) ownership restrictions prohibiting any shareholder fromholding an interest of more than 15% of the share capital or voting
rights of the Company, acting alone or in concert with others. See
sections 3.1.11 and 3.1.12 above. In addition, there were changes
in the composition of the Board of Directors and its internal rules.
See section 4 below.

3.3.2.3

Core Shareholder Arrangements

Grandfathering Agreement
At the Consummation, the French State, Sogepa, the German
State, KfW and GZBV (all parties together the “Parties” and each,individually, as a “Party”) entered into an agreement with respect
to certain grandfathering rights under the Articles of Association.
Below is a summary of such agreement.

Individual Grandfathering Rights
A Party that is individually grandfathered pursuant to Article 16.1. bof the Articles of Association (such Party holding “Individual
Grandfathering Rights”) shall remain individually grandfatheredin accordance with the Articles of Association if the new concert
with respect to the Company (the “New Concert”) is subsequently
terminated (for instance by terminating the New Shareholders’
Agreement) or if it exits the New Concert.

Loss of Individual Grandfathering Rights
A Party holding Individual Grandfathering Rights as well as any of
its afﬁliates who are grandfathered pursuant to Article 16.1. b inconjunction with Article 16.3 of the Articles of Association (suchafﬁ liates holding “Derived Grandfathering Rights”, and theIndividual Grandfathering Rights and the Derived Grandfathering
Rights, together, the “Grandfathering Rights”) shall all no longer
be entitled to exercise their Grandfathering Rights in the event:the New Concert is terminated as a result of it or any of its afﬁliates
having actually or constructively terminated such Concert; or■
it or its relevant afﬁliate(s) exit(s) the New Concert,■and such termination or exit is not for good cause and is not based onmaterial and on-going violations of the New Concert arrangements,
including, without limitation, of the New Shareholders’ Agreement,by the other principal Member of the New Concert.
In the event that in the future the voting rights in the Company of
the other principal Member of the New Concert together with thoseof its afﬁliates would for an uninterrupted period of three months
represent less than 3% of the outstanding aggregate voting rightsof the Company, the Grandfathering Rights of the Party including its

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afﬁliates which were no longer entitled to use their Grandfathering
Rights shall from then on revive and Sogepa and GZBV shall jointly
notify the Company to that effect.

Notification to the Company
The Company will not be required to take any of the actions
provided for in Article 15 of the Articles of Association pursuant
to the post-concert Grandfathering Agreement unless and until
it receives (i) a joint written instruction from Sogepa and GZBVwith respect to the taking of any of the actions provided for in
Article 15 of the Articles of Association pursuant to the postconcert Grandfathering Agreement, or (ii) a copy of a binding
advice rendered by three independent, impartial and neutral Expert
Adjudicators in order to settle any dispute between the Parties
arising out of or in connection with the post-concert Grandfathering
Agreement.
The Company will not incur any liability to any of the Parties bytaking such actions following receipt of any such joint instruction orbinding advice, and the Company will not be required to interpretthe post-concert Grandfathering Agreement or any such joint
instruction or binding advice.
Notwithstanding the description under “Various provisions –Jurisdiction” below, the courts of the Netherlands will haveexclusive jurisdiction to resolve any dispute, controversy or claim
affecting the rights or obligations of the Company under the postconcert Grandfathering Agreement.

Various provisions
Termination. The post-concert Grandfathering Agreement
terminates only if either the French State and its afﬁ liates or
the German State and its afﬁliates no longer hold shares in the
Company.
Governing law. Laws of the Netherlands.
Jurisdiction. Binding advice for any dispute, controversy or claim
arising out of or in connection with the post-concert Grandfathering
Agreement in accordance with the procedure set forth in the postconcert Grandfathering Agreement; provided, however, that to theextent application to the courts is permitted to resolve any suchdispute controversy or claim, the courts of the Netherlands shallhave exclusive jurisdiction.

End of Former Consortium and New Shareholders’
Agreement
At the Consummation, the participation agreement among theCompany’s former core shareholders and, as at 31 December
2012, including KfW, was terminated and replaced in part by the
New Shareholders’ Agreement, which has a much more limited
scope.
Below is a further description of the New Shareholders’ Agreement,
based solely on a written summary of the main provisions of the
New Shareholders’ Agreement that has been provided to theCompany by Sogepa, GZBV and SEPI (all parties together the“Shareholders”).

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Governance of the Company
Appointment of the Directors. The shareholders shall votein favour of any draft resolution relating to the appointment of
Directors submitted to the shareholders’ meeting of the Company
in accordance with the terms and conditions of the German State
Security Agreement and the French State Security Agreement(as described below). If, for whatever reason, any person to beappointed as a Director pursuant to the German State Security
Agreement or the French State Security Agreement is notnominated, the shareholders shall exercise their best endeavours
so that such person is appointed as a Director.
Sogepa and GZBV shall support the appointment of one Spanish
national that SEPI may present to them as Member of the Boardof Directors of the Company, provided such person qualiﬁes as an
Independent Director pursuant to the conditions set forth in the
Board Rules, and shall vote as shareholders in any shareholders’meeting in favour of such appointment and against the appointmentof any other person for such position.
If, for whatever reason, the French State Security Agreement and/or
the German State Security Agreement has / have been terminated,
KfW or Sogepa, as the case might be, shall propose two persons,and the shareholders shall exercise their best endeavours so thatthese persons are appointed as Directors.
Modiﬁcation of the Articles of Association. Sogepa and GZBV
shall consult each other on any draft resolution intending to modify
the Board Rules and/or the Articles of Association. Unless Sogepa
and GZBV agree to vote in favour together on such draft resolution,
the shareholders shall vote against such draft resolution. If Sogepa
and GZBV reach a mutual agreement on such draft resolution, theshareholders shall vote in favour of such draft resolution.
Reserved Matters. With respect to the matters requiring theapproval of a Qualiﬁed Majority at the Board level (“Reserved
Matters”), all the Directors shall be free to express their own views.
If the implementation of a Reserved Matter would require a decisionof the shareholders’ meeting of the Company, Sogepa and GZBV
shall consult each other with a view to reaching a common position.
Should Sogepa and GZBV fail to reach a common position, Sogepa
and GZBV shall remain free to exercise on a discretionary basis
their votes.
Prior consultation. Sogepa and GZBV shall consult each other onany draft resolution submitted to the shareholders’ meeting otherthan related to Reserved Matters and the Board Rules.

Mandatory Takeover Threshold
The total aggregate voting rights of the shareholders shall always
represent less than 30% of the voting rights of the Company, orless than any other threshold the crossing of which would trigger
for any shareholder a mandatory takeover obligation (the “MTO
Threshold”). In the event that the total aggregate voting rights ofthe shareholders exceed the MTO Threshold, the shareholders
shall take all appropriate actions as soon as reasonably practicable,
but in any event within 30 days, to fall below the MTO Threshold.

Transfer of Securities

3

Permitted transfer. Transfer of securities by any shareholder toone of its afﬁliates.
Pre-emption right. Pro rata pre-emption rights of the shareholders
in the event any shareholder intends to transfer any of its securities
to a third party directly or on the market.
Call-option right. Call-option right for the benefit of theshareholders in the event that the share capital or the voting
rights of any shareholders cease to be majority owned directly or
indirectly by the French State, the German State or the Spanish
State as applicable.
Tag-along right. Tag-along right for the beneﬁt of SEPI in theevent that Sogepa, the French State or any of their afﬁliates andany French public entity and GZBV, the German State or any of
their afﬁliates and any public entity propose together to transfer
all of their entire voting rights interests.

Various provisions
Termination. The New Shareholders’ Agreement may cease
to apply in respect of one or more Shareholders and/or their
afﬁliates, subject to the occurrence of certain changes in its or theirshareholding interest in the Company or in its or their shareholders.
Governing law. Laws of the Netherlands.

Balance of Interests
The shareholders agree their common objective to seek a balance
between themselves of their respective interest in the Company
as follows:■

to hold as closely as reasonably possible to 12% of the voting
rights for GZBV, together with any voting rights attributable to
GZBV and/or to the German State, pursuant to Dutch takeoverrules except for voting rights attributable due to acting in concert
with the other Parties;■
to hold as closely as reasonably possible to 4% of the voting
rights for SEPI, together with any voting rights attributable to
SEPI and/or to the Spanish State, pursuant to Dutch takeoverrules except for voting rights attributable due to acting in concert
with the other Parties.
■

Jurisdiction. Arbitration in accordance with the Rules of Arbitrationof the International Chamber of Commerce, with the seat ofarbitration in The Hague (The Netherlands).

to hold as closely as reasonably possible to 12% of the voting
rights for Sogepa, together with any voting rights attributable toSogepa and/or to the French State, pursuant to Dutch takeoverrules except for voting rights attributable due to acting in concert
with the other Parties;

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3.3.2.4

Undertakings with Respect to Certain Interests of Certain Stakeholders

The Company has made certain undertakings and entered into
certain agreements in connection with certain interests of its former
core shareholders and the German State.

Director are comparable to those to serve as a French Defence
Outside Director, with the additional requirement that a German
Defence Outside Director may not be a civil servant.

State Security Agreements and Related Undertakings
and Negotiations

The Company has agreed to negotiate with the Spanish Statein order to reach a special security agreement relating to theprotection of the essential security interests of the Spanish State.

The Company and the French State have entered into anamendment to the current convention between the French Stateand the Company relating to the ballistic missiles business of
the Company (as so amended, the “French State Security
Agreement”). Under the French State Security Agreement,
certain sensitive French military assets will be held by a Company
subsidiary (the “French Defence Holding Company”). At theConsummation, the Company contributed certain sensitive
French military assets to the French Defence Holding Company.
The French State has the right to approve or disapprove of —but not to propose or appoint — three outside Directors to theBoard of Directors of the French Defence Holding Company (the“French Defence Outside Directors”), at least two of whommust qualify as Independent Directors under the Board Rules
if they were Members of the Board. Two of the French Defence
Outside Directors are required to also be Members of the Board.
French Defence Outside Directors may neither (i) be employees,
managers or corporate ofﬁcers of a company belonging to theGroup (although they may be Members of the Board) nor (ii) havematerial on-going professional relationships with the Group.
The Company and the German State have entered into an agreement
relating to the protection of essential interests to the German
State’s security (the “German State Security Agreement”). Under
the German State Security Agreement, certain sensitive German
military assets are held by a Company subsidiary (the “German
Defence Holding Company”). The German State has the right toapprove or disapprove of — but not to propose or appoint — threeoutside Directors to the Supervisory Board of the German Defence
Holding Company (the “German Defence Outside Directors”), atleast two of whom must qualify as Independent Directors under the
Board Rules if they were Members of the Board. Two of the German
Defence Outside Directors are required to also be Members of theBoard. The qualiﬁcations to serve as a German Defence Outside

Dassault Aviation
The Company entered into an agreement with the French State
pursuant to which the Company would:
grant the French State a right of ﬁrst offer in case of the sale of
all or part of its shareholding in Dassault Aviation; and■commit to consult with the French State prior to making any
decision at any shareholders’ meeting of Dassault Aviation.
■

As disclosed in a press release dated 28 November 2014 theCompany in an off-market block trade sold to Dassault Aviation
approximately 8% of Dassault Aviation’s share capital.

Stock Exchange Listings
The Company has undertaken to the parties to the New
Shareholders’ Agreement that for the duration of the New
Shareholders’ Agreement Airbus Group N.V. shares will remain
listed exclusively in France, Germany and Spain.

Specific Rights of the French State
Pursuant to an agreement entered into between the Company
and the French State (the “Ballistic Missiles Agreement”),
the Company has granted to the French State (a) a veto rightand subsequently a call option on the ballistic missiles activity
exercisable under certain circumstances, including if (i) a third party
acquires, directly or indirectly, either alone or in concert, more than
15% or any multiple thereof of the share capital or voting rights of
the Company or (ii) the sale of the ballistic missiles assets or of theshares of such companies carrying out such activity is consideredand (b) a right to oppose the transfer of any such assets or shares.
The Company, the French State and MBDA are parties to a similar
convention regarding the assets comprising the French nuclear
airborne systems under which the French State has similar rights.

3.3.3 Form of Shares
The shares of the Company are in registered form. The Boardof Directors may decide with respect to all or certain shares, onshares in bearer form.
Shares shall be registered in the shareholders’ register without
the issue of a share certiﬁcate or, should the Board of Directors
so decide, with respect to all or certain shares, with the issue of100

a certiﬁcate. Share certiﬁcates shall be issued in such form as
the Board of Directors may determine. Registered shares shallbe numbered in the manner to be determined by the Board of
Directors.

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3.3.4 Changes in the Shareholding of the Company since its Incorporation
The Company was founded with an authorised share capital of
500,000 Netherlands Guilders (“NLG”) divided into 500 shareseach having a nominal value of 1,000 NLG, of which 100 were
issued to Aerospatiale Matra on 29 December 1998. Theseshares were transferred to DASA AG by way of notarised transfer
certiﬁcate on 28 December 1999.
The changes in the shareholding of the Company since its initialpublic offering and listing are set forth below (for a description of
the changes in the issued share capital of the Company since its
incorporation, see “— 3.2.5 Changes in the Issued Share Capital
since Incorporation of the Company”).
Starting in July 2000, 4,293,746 Company shares were distributed
without payment of consideration by the French State to certain
former shareholders of Aerospatiale Matra as a result of its
privatisation in June 1999. The last distribution took place inJuly 2002.
In addition, in January 2001, the French State and Lagardère soldon the market all of their Company shares (respectively 7,500,000
and 16,709,333 Company shares) other than their Indirect
Company Shares (and, in the case of the French State, otherthan the Company shares to be distributed to former shareholdersof Aerospatiale Matra, see “— 3.3.2 Relationships with Principal
Shareholders — Speciﬁc Rights and Undertakings of the French
State”) that they held as a result of the non-exercise of the overallotment option granted to the underwriters in the context of theinitial public offering carried out by the Company for the purposeof its listing in July 2000 (including, in the case of Lagardère, thoseshares other than its Indirect Company Shares purchased fromthe French Financial Institutions at the end of the exercise periodof the over-allotment option).
On 8 July 2004, Daimler announced that it had placed on themarket (in the context of a hedging transaction) all of its Company
shares (22,227,478 Company shares), representing 2.73% of thecapital and 2.78% of the Company voting rights at that date, except
for its Indirect Company Shares.
On 11 November 2005, DASA transferred its entire interest in the
Company to its wholly owned subsidiary DaimlerChrysler Luft-und
Raumfahrt Beteiligungs GmbH & Co. KG (“DC KG”). However, inNovember 2006, DC KG then transferred its entire interest in the
Company back to DASA.
On 4 April 2006, Daimler and Lagardère announced the entry into
simultaneous transactions aimed at reducing by 7.5% each theirrespective shareholdings in the Company. Daimler entered into
a forward sale agreement of approximately 61 million Company
shares with a group of investment banks. Daimler indicated that it
had lent these shares to the banks in anticipation of the settlementof the forward sale. Lagardère issued mandatory exchangeablebonds. The Company shares deliverable at the maturity of thebonds represented a maximum of 7.5% of the share capital of theCompany, or approximately 61 million Company shares, and weredelivered in three equal tranches representing 2.5% of the sharecapital of the Company. The ﬁrst two tranches were deliveredin June 2007 and June 2008, with delivery of the third tranchebrought forward from June 2009 to March 2009, as discussed
below.
On 8 September 2006, the Company was notiﬁ ed that JSC
Vneshtorgbank (formerly Bank of Foreign Trade) acquired
41,055,530 shares of the Company representing 5.04% of theshare capital of the Company at that date.
On 9 February 2007, Daimler reached an agreement with the
Dedalus consortium by which it effectively reduced its shareholdingin the Company from 22.5% to 15%, while maintaining the balanceof voting rights between German and French shareholders. The
Dedalus consortium thereby acquired a 7.5% equity interest in the
Company, with Daimler continuing to control the voting rights ofthe entire 22.5% package of Company shares.
On 26 December 2007, JSC Vneshtorgbank sold and transferred
41,055,530 Company shares to the Bank for Development andForeign Economic Affairs (Vnesheconombank). The Company was
notiﬁed of such transaction thereafter.

3

On 26 January 2009, Lagardère and Natixis, the sole subscriber
to and sole holder of the outstanding mandatory exchangeablebonds issued by Lagardère in 2006, signed an amendment tothe subscription contract whereby they agreed, on the initiativeof Natixis, to bring forward the redemption date of the mandatoryexchangeable bonds — and consequently, the delivery date of thethird tranche of Company shares — from 25 June 2009 to 24 March
2009. Under the terms of this amendment, Lagardère delivered
20,370,000 Company shares, representing 2.5% of the capitaland voting rights of the Company, to Natixis on 24 March 2009.
On 19 March 2010, Daimler and the Dedalus consortium of private
and public-sector investors conﬁ rmed the continuation of theagreement reached on 9 February 2007 concerning the equity
interests and voting rights in the Company (as discussed above).
At Germany’s Federal Chancellery on 16 March 2010, Daimler
and the investors stated their willingness to maintain the existing
agreement without any changes. As a result, Daimler continued tohold 22.5% of the voting rights in the Company while its economic
interest remained at 15%. Thus, the existing balance of voting
rights between German and French shareholders was unchanged.
On 10 November 2011, Daimler announced that it had reached
an agreement in principle with the German federal governmentthat KfW would take over an equity interest in the Company from
Daimler.
On 6 December 2012 pursuant to a transaction contemplatedby the Multiparty Agreement, Daimler sold 61.1 million Company
shares (approximately 7.44% of the outstanding Company shares)
through an ABB. This reduced Daimler’s economic interest in the
Company to approximately 7.44% and its voting interest to 14.88%.
KfW acquired 2.76% of the outstanding Company shares as part of
the ABB. In a second transaction, KfW acquired (through a wholly

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owned subsidiary) 65% of the shares in Dedalus on 2 January
2013, which brought its stake in Dedalus to 78%. The remaining
22% was held by certain other German public entities. Dedalus
held an economic interest of 7.44% in the Company as of the timeof this acquisition. As a result of these two transactions, KfW held avoting interest of 2.76% in the Company and an economic interestof 8.56% in the Company – 2.76% directly and 5.80% via Dedalus.
The other German public entities participating in Dedalus held a
1.64% economic interest in the Company via Dedalus. The joint
economic interest of KfW and such German public entities in the
Company was thus 10.2% following these acquisitions.

On 9 April 2013, Lagardère sold its remaining 61,000,000 Company
shares (approximately 7.4% of the outstanding Company shares).
On 17 April 2013, the French State sold through Sogepa 12,977,088
Company shares (approximately 1.56% of the outstanding
Company shares) and Daimler sold its remaining 61,100,000
Company shares (approximately 7.5% of the outstanding Company
shares).
On 26 April 2013, the French State sold 17,451,000 Company
shares (approximately 2.1% of the outstanding Company shares).
On 31 July 2013, SEPI sold 2,802,450 Company shares(approximately 0.36% of the outstanding Company shares).

On 19 March 2013, KfW transferred the 2.76% of the Company
shares which it held directly to GZBV. As part of the Consummation,
7.44% of the outstanding Company shares held by DASA weretransferred to GZBV, and DASA, which now holds a 7.44%
economic and voting interest in the Company, became a wholly
owned subsidiary of Daimler. GZBV, which now holds a 10.2%
economic and voting interest in the Company, is now owned
83.96% by KfW and 16.04% by the other German public entities
which were investors in Dedalus immediately prior to such transfer.

End of December 2013 GZBV acquired 1,872,072 Company shares(approximately 0.24% of the outstanding Company shares).
On 16 January 2014, the French State announced it sold throughSogepa around 8,000,000 Company shares (approximately 1% of
the outstanding Company shares) in line with a bilateral agreement
between the French and German States which provides that theGerman State shall increase its voting rights in the Company to
11% and the French State shall reduce its voting rights to the samelevel. Following this transaction, the French State through Sogepa,
the German State through GZBV and the Spanish State through
SEPI jointly remained the majority shareholders of the Company,
with a minimum 26% of the voting rights.

As part of the Consummation, 7.44% of the outstanding Company
shares held by Sogeade were transferred to Sogepa, and Sogeade,which now holds a 7.44% economic and voting interest in the
Company, became a wholly owned subsidiary of Lagardère.
On 4 April 2013, SEPI sold 9,560,000 Company shares(approximately 1.15% of the outstanding Company shares).

The evolution in ownership of the share capital and voting rights of the Company over the past three years is set forth in the table below:
Position as of
31 December 2014

Shareholders% ofcapitalPosition as of
31 December 2013

% ofvotingrightsNumber ofshares% ofcapital% ofvotingrightsShareholders

Number ofsharesPosition asof 31 December 2012
% ofcapital% ofvotingrightsNumber ofsharesSOGEPA

10,94%

10,94%

85,835,477 11.99%

12.03%

93,864,165

Sogeade22.16%

22.30%

183,337,704

GZBV(1)

10.92%

10.93%

85,709,822 10.94%

10.98%

85,709,822

DASA

14.77%

14.87%

122,225,136

SEPI

4.12%

4.12%

32,330,381

4.13%

4.14%

32,330,381

SEPI

5.40%

5.44%

44,690,871

-

-

-

-

-

-

KfW

2.75%

2.76%

22,725,182-

Sub-total New
Shareholder
25,98%
Agt.
Foundation“SOGEPA”
Public(2)

0.00%
73,97%

Own sharebuy-back(3)

0.06%

Total

100%

25,99% 203,875,680 27.06%
0.00%

0

0.07%

74,01% 580,473,073 72.51%-

27.16% 211,904,368

Sub-total
ContractualPartnership45.08%

0.07%

French State

0.06%

0.06%

(2)

54.23%

54.57% 448,659,771

72.84%

575,606
568,418,146

431,832

0.36%-

2,835,121

100% 784,780,585

100%

100%

783,157,635

Public502,746

Own sharebuy-back(3)

0.63%

-

5,226,535

Total

100%

100%

827,367,945(1) KfW & other German public entities.
(2) Including Company employees. As of 31 December 2013, the Company’s employees held approximately 2.13% of the share capital (and voting rights).
(3) The shares owned by the Company do not carry voting rights.

102

45.37% 372,978,893

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General Description of the Company and its Share Capital
3.3 Shareholdings and Voting Rights

To the knowledge of the Company, there are no pledges over theshares of the Company.
The Company requested disclosure of the identity of the beneﬁcial
holders of its shares held by identiﬁable holders (“Titres au porteur
identifiables”) holding more than 2,000 shares each. The study,
which was completed on 31 December 2014, resulted in theidentiﬁcation of 3,013 shareholders holding a total of 564,226,312

Company shares (including 4,161,879 shares held by Iberclear
on behalf of the Spanish markets and 34,863,419 shares held byClearstream on behalf of the German market).
The shareholding structure of the Company as of 31 December
2014 is as shown in the diagram in “— 3.3.1 Shareholding Structure
at the end of 2014”.

3.3.5 Persons Exercising Control over the Company
See “— 3.3.1 Shareholding Structure at the end of 2014” and “— 3.3.2 Relationships with Principal Shareholders”.

3.3.6 Simpliﬁed Group Structure Chart
The following chart illustrates the simpliﬁed organisational structureof the Group as of 31 December 2014, comprising three Divisions
and the main Business Units. See “— Information on the Group’s

Activities — 1.1.1 Overview — Organisation of the Company’s
Businesses”. For ease of presentation, certain intermediate holding
companies have been omitted.

3

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104

EADS

Airbus DS
Limited (UK)

Cassidian
Holdings
Limited (UK)

AIRBUS GROUP REGISTRATION DOCUMENT 2014
5.58%

AirbusOperations
GmbH (Germany)

AirbusOperations SAS(France)

Airbus SAS(France)

Legal Forms are indicated for infomation purposes and are not always part of the legal name.

Subsidiaries held with no indication of ownership percentage are 100% owned.

MBDA Group

Astrium Services
UK Ltd (UK)

Airbus Defence
and Space Ltd(UK)

Astrium Services
GmbH (Germany)

Paradigm
Services Ltd(UK)

Paradigm Secure
Communications
Ltd (UK)

Infoterra Ltd(UK)

CRI, S.A.
(Spain)EADS Casa
Espacio, S.L.
(Spain)Astrium España
S.L. (Spain)

95%

Vector Aerospace
Holding SAS(France)

Airbus Helicopters
España S.A.
(Spain)AirbusHelicopters UK
Limited (UK)

Airbus Helicopters
DeutschlandGmbH (Germany)

Airbus Helicopters
SAS (France)

5%

Airbus Helicopters
Holding SAS(France)

Q

North America

AirbusOperations S.L.
(Spain)94,42%

Airbus Defence
and Space SAS(France)

Airbus DS Holding
France SAS(France)

Airbus DS GmbH
(Germany)

Airbus DS Holding
SAS (France)

Airbus DS
Holdings B.V.
(The Netherlands)

97.46%

5

DirectIndirect

Premium
Aerotech GmbH
(Germany)

EADS CASAFRANCE SAS(France)

EADS CASAHOLDING SAS(France)2.54%

4AirbusOperations
Ltd (UK)

Aerolia(France)

Sogerma(France)

MBDA Group(France)

EFW(Germany)

65%

Airbus Group,
Inc. (USA)

Airbus Defence
and Space, S.A.
(Spain)3

Airbus Helicopters

37.5%

3.69%

Airbus DS
SAS (France)

96.31%

Airbus GroupSAS (France)

Airbus Defence
and Space
GmbH (Germany)

2

AirbusAirbus Defence and Space

AirbusGroup
Limited (UK)(The Netherlands)

Airbus Group N.V.

GROUP STRUCTURE CHART

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General Description of the Company and its Share Capital
3.3 Shareholdings and Voting Rights

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General Description of the Company and its Share Capital
3.3 Shareholdings and Voting Rights

3.3.7 Purchase by the Company of its Own Shares
3.3.7.1

Dutch Law and Information on Share
Repurchase Programmes

Pursuant to EC Regulation No. 2273 / 2003, the Company issubject to conditions for share repurchase programmes anddisclosure relating thereto, as described below.
Under Dutch Civil law, the Company may acquire its own shares,
subject to certain provisions of the law of the Netherlands andthe Articles of Association, if (i) the shareholders’ equity less thepayment required to make the acquisition does not fall below
the sum of paid-up and called portion of the share capital andany reserves required by the law of the Netherlands and (ii) the
Company and its subsidiaries would not thereafter hold or holdin pledge shares with an aggregate nominal value exceeding
one-half (50%) of the Company’s issued share capital. Shareacquisitions may be effected by the Board of Directors only if
the shareholders’ meeting has authorised the Board of Directors
to effect such repurchases. Such authorisation may apply for a
maximum period of 18 months.
Shares held by the Company do not carry voting rights.
Usufructuaries and pledgees of shares that are held by theCompany are, however, not excluded from their voting rights insuch cases where the right of usufruct or pledge was vested before
the share was held by the Company.

3.3.7.2

French Regulations

As a result of its listing on a regulated market in France, theCompany is subject to the regulations summarised below.
Pursuant to Articles 241-1 to 241-5 of the AMF General Regulations,the purchase by a company of its own shares requires the
publication of the description of the share repurchase programme.
Such description must be published prior to the implementationof the share repurchase programme.
Under Articles 631-1 to 631-4 of the AMF General Regulations,a company may not trade in its own shares for the purpose ofmanipulating the market. Articles 631-5 and 631-6 of the AMF
General Regulations also deﬁne the conditions for a company’s
trading in its own shares to be valid.
After purchasing its own shares, the Company is required todisclose on its website speciﬁ ed information regarding such
purchases within at least seven trading days.

3

In addition, the Company must report to the AMF, on at least
a monthly basis, all the speciﬁ ed information regarding such
purchases previously published on its website and information
concerning the cancellation of such repurchased shares.

3.3.7.3

German Regulations

The Annual General Meeting of Shareholders held on 27 May 2014
authorised the Board of Directors, in a resolution that renewed theprevious authorisation given by the Annual General Meeting of
Shareholders held on 29 May 2013, for a period of 18 months fromthe date of such meeting, to repurchase shares of the Company, by
any means, including derivative products, on any stock exchange
or otherwise, as long as, upon such repurchase, the Company will
not hold more than 10% of the Company’s issued share capital andat a price not less than the nominal value and not more than thehigher of the price of the last independent trade and the highest
current independent bid on the trading venues of the regulated
market of the country in which the purchase is carried out.

As a foreign issuer, the Company is subject to German rules on
repurchasing its own shares only to a limited extent, since German
rules refer to the law of the Member State in which the Company
is domiciled.

A resolution will be submitted to the Annual General Meetingof Shareholders called for 27 May 2015 in order to renew theauthorisation given by the Annual General Meeting of Shareholders
held on 27 May 2014 and authorise the Board of Directors, fora new period of 18 months as from the date of such meeting,to repurchase shares of the Company, by any means, including
derivative products, on any stock exchange or otherwise, as longas, upon such repurchase, the Company will not hold more than
10% of the Company’s issued share capital and at a price not lessthan the nominal value and not more than the higher of the priceof the last independent trade and the highest current independent
bid on the trading venues of the regulated market of the country inwhich the purchase is carried out. This authorisation will replace theauthorisation given by the Annual General Meeting of Shareholders
held on 27 May 2014. As of 31 December 2014, the Company held
431,832 of its own shares, representing 0.06% of its share capital.

However, according to the Conduct Rules under the Spanish
Securities Act 24 / 1988 of 28 July 1988, insider trading is prohibitedand the Company may not trade in its own shares for the purposeof manipulating the market.

In addition, general principles of German law of insider trading,market manipulation and equal treatment of shareholders areapplicable.

3.3.7.4

Spanish Regulations

As a foreign issuer, the Company is not subject to Spanish rules
on trading in its own shares, which only apply to Spanish issuers.

3.3.7.5

Description of the Share Repurchase
Programme to be Authorised by the
Annual General Meeting of Shareholders
to be held on 27 May 2015

Pursuant to Articles 241-2-I and 241-3 of the AMF General
Regulations, below is a description of the share repurchaseprogramme (“descriptif du programme”) to be implemented by
the Company:■

date of the shareholders’ meeting to authorise the share
repurchase programme: 27 May 2015;

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General Description of the Company and its Share Capital
3.3 Shareholdings and Voting Rights

intended use of the Airbus Group N.V. shares held by theCompany as of the date of this document: the owning of sharesfor the performance of obligations related to employee shareoption programmes or other allocations of shares to employeesof the Group and the Group’s Companies: 336,940 shares.
■
purposes of the share repurchase programme to be
implemented by the Company (by order of decreasingpriority, without any effect on the actual order of use of
the repurchase authorisation, which will be determined ona case-by-case basis by the Board of Directors based onneed):
the reduction of share capital by cancellation of all or part of the
repurchased shares, it being understood that the repurchased
shares shall not carry any voting or dividend rights,
the owning of shares for the performance of obligations
related to (i) debt ﬁnancial instruments convertible into Airbus
Group N.V. shares, or (ii) employee share option programmes
or other allocations of shares to employees of the Group andthe Group’s companies,
the purchase of shares for retention and subsequent use forexchange or payment in the framework of potential external
growth transactions, andthe liquidity or dynamism of the secondary market of the Airbus
Group N.V. shares carried out pursuant to a liquidity agreement
to be entered into with an independent investment services
provider in compliance with the decision of the AMF dated
1 October 2008 related to approval of liquidity agreements
recognised as market practices by the AMF;■
procedure:
maximum portion of the issued share capital that may be
repurchased by the Company: 10%,
maximum number of shares that may be repurchased by
the Company: 78,591,488 shares, based on an issued sharecapital of 785,914,888 shares as of 31 March 2015. Assuming
the exercise of all stock options outstanding as of 31 March
2015, the threshold of 10% would represent 78,702,147 sharesbased on the 787,021,476 shares which would make up theentire fully-diluted share capital of the Company,
the amounts to be paid in consideration for the purchase of
the treasury shares must not, in accordance with applicable
Dutch law, exceed the equity components which are repayable
or distributable to the shareholders. “Equity components
repayable or distributable to the shareholders” means thecontribution premiums (in relation to contributions in kind),the issue premiums (in relation to cash contributions) and theother reserves as set out in the ﬁnancial statements of theCompany, from which the repurchase price for the treasury
shares must be deducted.
The Company undertakes to maintain at any time a sufﬁcientnumber of shares in public hands to meet the thresholds of
NYSE Euronext,
shares may be bought or sold at any time (including during apublic offering) to the extent authorised by the stock exchange
regulations and by any means, including, without limitation,by means of block trades and including the use of options,combinations of derivative ﬁnancial instruments or the issue of
■

■

■

■

■

■

■

■

■

securities giving rights in any way to Airbus Group N.V. shareswithin the limits set out in this document.
The portion of shares repurchased through the use of blocktrades may amount to all the shares to be repurchased in thecontext of this programme,in addition, in the event that derivative ﬁnancial instruments areused, the Company will ensure that it does not use mechanisms
which would signiﬁcantly increase the volatility of the shares inparticular in the context of call options,characteristics of the shares to be repurchased by theCompany: shares of Airbus Group N.V., a company listed onEuronext Paris, on the regulierter Markt of the Frankfurt Stock
Exchange and on the Madrid, Bilbao, Barcelona and Valencia
Stock Exchanges,
maximum purchase price per share: € 100;

term of the share repurchase programme and othercharacteristics: this share repurchase programme shall bevalid until 27 November 2016 inclusive, i.e. the date of expiry of
the authorisation requested from the Annual General Meetingof Shareholders to be held on 27 May 2015.

As of the date of this document, the Company has not entered into
any liquidity agreement with an independent investment services
provider in the context of the share repurchase programme.

3.3.7.6

Description of the Exceptional Share
Repurchase Programme to be Authorisedby the Annual General Meeting of
Shareholders to be held on 27 May 2015

■

■

■

■

106

Pursuant to Articles 241-2-I and 241-3 of the AMF General
Regulations, below is a description of the exceptional share
repurchase programme (“descriptif du programme”) to be
implemented by the Company:
date of the shareholders’ meeting to authorise the share
repurchase programme: 27 May 2015;■
intended use of the Airbus Group N.V. shares held by theCompany as of the date of this document: For details on useof the Airbus Group N.V. shares already held by the Company,
please refer to “3.3.7.5 – Description of the Share Repurchase
Programme to be authorised by the Annual General Meeting of
Shareholders to be held on 27 May 2015”;■
sole purpose of the share repurchase programme to be
implemented by the Company: the reduction of share capitalby cancellation of all of the repurchased shares;■
procedure:
maximum portion of the issued share capital that may be
repurchased by the Company: 10%,
maximum number of shares that may be repurchased by
the Company: 78,591,488 shares, based on an issued sharecapital of 785,914,888 shares as of 31 March 2015. Assuming
the exercise of all stock options outstanding as of 31 March
2015, the threshold of 10% would represent 78,702,147 sharesbased on the 787,021,476 shares which would make up theentire fully-diluted share capital of the Company,
the amounts to be paid in consideration for the purchase of
the treasury shares must not, in accordance with applicable
■

■

■

■

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3.4 Dividends■

Dutch law, exceed the equity components which are repayable
or distributable to the shareholders. “Equity components
repayable or distributable to the shareholders” means thecontribution premiums (in relation to contributions in kind),the issue premiums (in relation to cash contributions) and theother reserves as set out in the ﬁnancial statements of theCompany, from which the repurchase price for the treasury
shares must be deducted.
The Company undertakes to maintain at any time a sufﬁcientnumber of shares in public hands to meet the thresholds of
NYSE Euronext,
shares may be bought or sold at any time (including during apublic offering) to the extent authorised by the stock exchange
regulations and by any means, including, without limitation,by means of block trades and including the use of options,combinations of derivative ﬁnancial instruments or the issue of
securities giving rights in any way to Airbus Group N.V. shareswithin the limits set out in this document.

■

■

■

■

The portion of shares repurchased through the use of blocktrades may amount to all the shares to be repurchased in thecontext of this programme,in addition, in the event that derivative ﬁnancial instruments areused, the Company will ensure that it does not use mechanisms
which would signiﬁcantly increase the volatility of the shares inparticular in the context of call options,characteristics of the shares to be repurchased by theCompany: shares of Airbus Group N.V., a company listed onEuronext Paris, on the regulierter Markt of the Frankfurt Stock
Exchange and on the Madrid, Bilbao, Barcelona and Valencia
Stock Exchanges,
maximum purchase price per share: € 85;

term of the share repurchase programme and othercharacteristics: this share repurchase programme shall bevalid until 27 November 2016 inclusive, i.e. the date of expiry of
the authorisation requested from the Annual General Meetingof Shareholders to be held on 27 May 2015.

3

3.4 Dividends
3.4.1

Dividends and Cash Distributions Paid Since the Incorporationof the Company

Cash distributions paid to the shareholders since the incorporation of the Company are set forth in the table below:
Date of the cash distribution payment

Gross amount per share(1)2000

27 June 2001

€ 0.502001

28 June 2002

€ 0.502002

12 June 2003

€ 0.30Financial year

2003

4 June 2004

€ 0.402004

8 June 2005

€ 0.502005

1 June 2006

€ 0.652006

16 May 2007

€ 0.122007

4 June 2008

€ 0.12

2008

8 June 2009

€ 0.20

2009

-

-

2010

6 June 2011

€ 0.222011

7 June 2012

€ 0.452012

5 June 2013

€ 0.602013

3 June 2014

€ 0.752014

3 June 2015

€ 1.20(1) Note: figures have not been adjusted to take into account changes in the number of shares outstanding.

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General Description of the Company and its Share Capital
3.4 Dividends

3.4.2 Dividend Policy of the Company
Based on earnings per share of € 2.99 in 2014, the Board of Directors has proposed payment of a dividend of € 1.20 per share to thenext Annual General Meeting of Shareholders. Subject to approval by the Annual General Meeting, the dividend is expected to be paidon 3 June 2015 (expected record date of 2 June 2015).
This is in line with the Group’s dividend policy to target a sustainable growth in dividend with a pay-out ratio of 30% to 40%.

3.4.3 Unclaimed Dividends
Pursuant to the Articles of Association, the claim for payment of
a dividend or other distribution approved by the shareholders’meeting shall lapse ﬁve years after the day on which such claim
becomes due and payable. The claim for payment of interim

dividends shall lapse ﬁve years after the day on which the claim
for payment of the dividend against which the interim dividend
could be distributed becomes due and payable.

3.4.4 Taxation
The statements below represent a broad analysis of the current
Netherlands tax laws. The description is limited to the material tax
implications for a holder of the Company’s shares (the “Shares”)
who is not, or is not treated as, a resident of the Netherlands
for any Netherlands tax purposes (a “Non-Resident Holder”).
Certain categories of holders of the Company’s shares may besubject to special rules which are not addressed below and which
may be substantially different from the general rules described
below. Investors who are in doubt as to their tax position in
the Netherlands and in their state of residence should consult
their professional Advisors. Where the summary refers to “theNetherlands” or “Netherlands”, it refers only to the European partof the Kingdom of the Netherlands.

Withholding Tax on Dividends
In general, a dividend distributed by the Company in respectof Shares will be subject to a withholding tax imposed by the
Netherlands at a statutory rate of 15%. Dividends include dividends
in cash or in kind, deemed and constructive dividends, repaymentof paid-in capital not recognised as capital for Netherlands dividend
withholding tax purposes, and liquidation proceeds in excess of
the average paid-in capital recognised as capital for Netherlands
dividend withholding tax purposes. Stock dividends paid out of
the Company’s paid-in-share premium, recognised as capital for
Netherlands dividend withholding tax purposes, will not be subject
to this withholding tax.
A Non-Resident Holder of Shares can be eligible for a partial orcomplete exemption or refund of all or a portion of the above
withholding tax pursuant to domestic rules or under a tax convention
that is in effect between the Netherlands and the Non-Resident
Holder’s country of residence. The Netherlands has concluded
such conventions with the US, Canada, Switzerland, Japan, almost
all European Union Member States and other countries.

108

Withholding Tax on Sale or Other Dispositions ofSharesPayments on the sale or other dispositions of Shares will not be
subject to Netherlands withholding tax, unless the sale or otherdisposition is, or is deemed to be, made to the Company or a direct
or indirect subsidiary of the Company. In principle, a redemption
or sale to the Company or a direct or indirect subsidiary of theCompany will be treated as a dividend and will be subject to therules set forth in “Withholding Tax on Dividends” above.

Taxes on Income and Capital Gains
A Non-Resident Holder who receives dividends distributed by
the Company on Shares or who realises a gain from the sale ordisposition of Shares, will not be subject to Netherlands taxation
on income or capital gains unless:such income or gain is attributable to an enterprise or part thereof
which is either effectively managed in the Netherlands or carriedon through a permanent establishment (“vaste inrichting”) or
permanent representative (“vaste vertegenwoordiger”) in the
Netherlands;■
the Non-Resident Holder is not an individual and the NonResident Holder has or is deemed to have, directly or indirectly,
a substantial interest (“aanmerkelijk belang”) or a deemed
substantial interest in the Company and such interest (i) does
not form part of the assets of an enterprise and (ii) is held by the
Non-Resident Holder with the main objective, or one of the main
objectives, to avoid Netherlands withholding tax on dividends or
Netherlands individual income tax at the level of another personor entity; or■
the Non-Resident Holder is an individual and (i) the Non-Resident
Holder has, directly or indirectly, a substantial interest(“aanmerkelijk belang”) or a deemed substantial interest in the
Company and such interest does not form part of the assets■

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General Description of the Company and its Share Capital
3.5 Annual Securities Disclosure Reportof an enterprise, or (ii) such income or gain qualiﬁes as income
from miscellaneous activities (“belastbaar resultaat uit overigewerkzaamheden”) in the Netherlands as deﬁned in the Dutch
Income Tax Act 2001 (“Wet inkomstenbelasting 2001”).
Generally, a Non-Resident Holder of Shares will not have asubstantial interest in the Company’s share capital, unless the NonResident Holder, alone or together with certain related persons
holds, jointly or severally and directly or indirectly, Shares in the
Company, or a right to acquire Shares in the Company representing
5% or more of the Company’s total issued and outstanding sharecapital or any class thereof. Generally, a deemed substantial
interest exists if all or part of a substantial interest has been or isdeemed to have been disposed of with application of a roll-overrelief.

Gift or Inheritance Taxes
Netherlands gift or inheritance taxes will not be levied on thetransfer of Shares by way of gift, or upon the death of a NonResident Holder, unless the transfer is construed as an inheritanceor gift made by or on behalf of a person who, at the time of thegift or death, is or is deemed to be resident in the Netherlands.

Value Added Tax
No Netherlands value added tax is imposed on dividends on the
Shares or on the transfer of the Shares.

Other Taxes and Duties
There is no Dutch registration tax, transfer tax, capital tax, stamp
duty or any other similar tax or duty other than court fees payablein the Netherlands in respect of or in connection with the execution,delivery and/or enforcement by legal proceedings (including any
foreign judgment in the courts of the Netherlands) with respect tothe dividends relating to the Shares or on the transfer of the Shares.

Residence
A Non-Resident Holder will not become resident, or be deemed tobe resident, in the Netherlands solely as a result of holding a Shareor of the execution, performance, delivery and/or enforcement ofrights in respect of the Shares.

3
3.5 Annual Securities Disclosure Report
The announcements listed below and underlying information are on display and may be inspected during the life of this Registration
Document on www.airbusgroup.com:
Press release – Airbus Group 2013 Results: another Year of Operational and Financial Improvement

26 February 2014

Press release – Airbus Group Reports First Quarter 2014 Results

13 May 2014

Press release –Airbus launches A330neo

14 July 2014

Press release – Airbus terminates purchase order with Skymark Airlines for A380s

28 July 2014

Press release – Airbus Group Shows Continued Progress in Half-Year (H1) 2014 Results

30 July 2014

Press release – Airbus Defence and Space continues transformation with portfolio optimisation
Press release – Airbus to adjust A330 production rate to nine a month

16 September 201417 October 2014

Press release – Airbus Group Reports Improved Nine-Month (9m) Results 2014

14 November 2014

Press release – Airbus Group Sells Part of Its Stake in Dassault Aviation

28 November 2014

Press release – Airbus Group Achieves Record Revenues, EBIT* and Order Backlog in 2014

27 February 2015

In addition, Airbus Group publishes announcements made in the ordinary course of business which are also available on
www.airbusgroup.com.

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Corporate Governance
4.1 Management and Control

112

4.1.1 Corporate Governance Arrangements

112

4.1.2 Corporate Governance Arrangements in 2014

115

4.1.3 Dutch Corporate Governance Code, “Comply or Explain”

125

4.1.4 Enterprise Risk Management System

126

4.1.5 Ethics and Compliance Organisation

131

4.2 Interests of Directors and Principal Executive Ofﬁcers

132

4.2.1 Remuneration Policy

132

4.2.2 Long-Term Incentives Granted to the Chief Executive Officer

140

4.2.3 Related Party Transactions

140

4.3 Employee Proﬁt Sharing and Incentive Plans

141

4.3.1 Employee Profit Sharing and Incentive Agreements

141

4.3.2 Employee Share Ownership Plans

141

4.3.3 Long-Term Incentive Plans

142

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4.1 Management and Control
The corporate governance arrangements of the Company were
substantially changed pursuant to the Multiparty Agreement,
including changes in the composition of the Board of Directors
and the rules governing its internal affairs (the “Board Rules”).
These changes are intended to further normalise and simplify

4.1.1

the Company’s corporate governance, reﬂecting an emphasis
on best corporate governance practices and the absence of acontrolling shareholder group. Below is a summary descriptionof such changes.

Corporate Governance Arrangements

Board of Directors Composition and Board Rules
Under the Articles of Association, the Board of Directors consistsof at most twelve (12) Directors, who each retire at the closeof the Annual General Meeting held three years following their
appointment. Under the Board Rules, at least a majority of theMembers of the Board of Directors (i.e., 7/12) must be European
Union nationals (including the Chairman of the Board of Directors)
and a majority of such majority (i.e., 4/7) must be both European
Union nationals and residents. No Director may be an active civil
servant. The Board of Directors has one (1) Executive Director andeleven (11) Non-Executive Directors. While the Board of Directors
appoints the Chief Executive Ofﬁcer of the Company (the “CEO”),
the CEO is required to be an Executive Director and must be an
EU national and resident; therefore it is anticipated that the Boardof Directors will appoint as CEO the person appointed by theshareholders as an Executive Director. At least nine (9) of the NonExecutive Directors must be “Independent Directors” (including
the Chairman of the Board of Directors).
Under the Board Rules, an “Independent Director” is a NonExecutive Director who is independent within the meaning of
the Dutch Corporate Governance Code and meets additional
independence standards. Speciﬁcally, where the Dutch Corporate
Governance Code would determine independence, in part, byreference to a Director’s relationships with shareholders who own
at least 10% of the Company, the Board Rules determine such
Director’s independence, in relevant part, by reference to such
Director’s relationships with shareholders who own at least 5%of the Company.
The Remuneration and Nomination Committee of the Board of
Directors (the “RNC”) is charged with recommending to the Boardof Directors the names of candidates to succeed active Board
Members after consultation with the Chairman of the Board of
Directors and the CEO.
The Board of Directors, deciding by simple majority vote, proposes
individuals to the shareholders’ meeting of the Company forappointment as Directors by the shareholders’ meeting. No
shareholder or group of shareholders, or any other entity, has theright to propose, nominate or appoint any Directors other than therights available to all shareholders under Dutch law.

112

In addition to the membership and composition rules describedabove, the RNC, in recommending candidates for the Board of
Directors, and the Board of Directors, in its resolutions proposedto the shareholders’ meeting relative to the naming of Directors
or decisions to propose replacements of any resigning or
incapacitated Director, are each required to apply the following
principles:■■the preference for the best candidate for the position, andthe maintenance, in respect of the number of Members of
the Board of Directors, of the observed balance among thenationalities of the candidates in respect of the location of themain industrial centres of the Company (in particular among thenationals of the four (4) Member States of the European Union
where these main industrial centres are located).

The Board of Directors is required to take into account, in the
resolutions proposed in respect of the nomination of Directors
presented to the shareholders’ meeting, the undertakings of theCompany to the French State pursuant to the amendment to
the French State Security Agreement and to the German State
pursuant to the German State Security Agreement, in each caseas described more fully above. In practice, this means that (A) two(2) of the Directors submitted to the shareholders for appointment
should also be French Defence Outside Directors (as deﬁ ned
above) of the French Defence Holding Company (as deﬁned above)
who have been proposed by the Company and consented to by
the French State and (B) two (2) of the Directors submitted to theshareholders for appointment should also be German Defence
Outside Directors (as deﬁ ned above) of the German Defence
Holding Company (as deﬁned above) who have been proposedby the Company and consented to by the German State.
The RNC endeavours to avoid a complete replacement of outgoing
Directors by new candidates, but rather to ensure continuity ofcompany-speciﬁc knowledge and experience within the Boardof Directors.

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Remuneration and Nomination Committee
The RNC has four (4) Members, with geographic diversity. Each
Member of the RNC is an Independent Director. One Member ofthe RNC is a Director who is appointed to the Board of Directors
on the basis of the French State Security Agreement. One Memberof the RNC is a Director who is appointed to the Board of Directors
on the basis of the German State Security Agreement. The Boardof Directors, by a Simple Majority (deﬁned below), appoints thechair of the RNC, who may not be any of the following:
the Chairman of the Board of Directors;
a current or former Executive Director of the Company;■a Non-Executive Director who is an Executive Director withanother listed company; or■a Director appointed to the Board of Directors on the basisof the French State Security Agreement or the German State
Security Agreement.
■■

Other Board Committees
The Board of Directors continues to have an Audit Committee, theresponsibilities of which have not changed. The Audit Committee
has four (4) Members and is chaired by an Independent Director
who is not the Chairman of the Board of Directors or a current
or former Executive Director of the Company. At least one (1)Member of the Audit Committee must be a ﬁnancial expert with
relevant knowledge and experience of ﬁnancial administration
and accounting for listed companies or other large legal entities.
The Board of Directors no longer has a Strategic Committee.

Role of the Board of Directors
The Board Rules specify that in addition to the Board of Directors’
responsibilities under applicable law and the Articles of Association,
the Board of Directors is responsible for certain enumerated
categories of decisions. Under the Articles of Association,
the Board of Directors is responsible for the management of
the Company. Under the Board Rules, the Board of Directors
delegates day-to-day management of the Company to the CEO,who, supported by the Executive Committee, makes decisions
with respect to the management of the Company. However, theCEO may not enter into transactions that form part of the key
responsibilities of the Board of Directors unless these transactions
have been approved by the Board of Directors. Most Board of
Directors’ decisions are made by a simple majority of the votesof the Directors (a “Simple Majority”), but certain decisions
must be made by a 2/3 majority (i.e., eight (8) favourable votes)of the Directors regardless of whether present or represented
in respect of the decision (a “Qualified Majority”). In addition,
amendments to certain provisions of the Board Rules require
the unanimous approval of the Board of Directors, with no morethan one Director not present or represented (including provisions
relating to nationality and residence requirements with respect toMembers of the Board of Directors and the Executive Committee).
However, no individual Director or class of Directors has a vetoright with respect to any Board of Directors’ decisions.

Matters that require Board of Directors’ approval include among
others, the following items (by Simple Majority unless otherwise
noted):
approving any change in the nature and scope of the businessof the Company and the Group;■
approving any proposed resolution to be presented to theshareholders’ meeting relating to a change of any of the articlesof the Articles of Association of the Company which requires
the approval of a majority of at least seventy-ﬁve percent (75%)
of the valid votes cast at such shareholders’ meeting (Qualiﬁed
Majority);■
approving the overall strategy and the strategic plan of the Group;■
approving the operational business plan of the Group (the“Business Plan”) and the yearly budget (the “Yearly Budget”) of
the Group, including the plans for Investment, R&D, Employment,
Finance and, as far as applicable, major programmes;■
setting the major performance targets of the Group;■
monitoring on a quarterly basis, the operating performance of
the Group;■
nominating, suspending or revoking the Chairman of the Boardof Directors and the CEO (Qualiﬁed Majority);■
approving of all of the Members of the Executive Committee as
proposed by the CEO and to approve their proposed appointment
as Managing Directors of important Group companies and theirservice contracts and other contractual matters in relation to the
Executive Committee Members and such Managing Directors;■
establishing, and approving amendments to the Board Rules
and the rules for the Executive Committee (Simple Majority withcertain exceptions);■
deciding upon the appointments of the Airbus Shareholder
Committee, the appointments of the Company’s Group Corporate
Secretary and the chairmen of the Supervisory Board (or similarorgan) of other important Group companies and Business Units,on the basis of the recommendations of the Remuneration and
Nomination Committee, as well as the institution and amendmentof the rules governing the organs of such entities;■
approving the relocation of the headquarters of the principal
companies of the Group and of the operational headquartersof the Company (Qualiﬁed Majority);■
approving decisions in connection with the location of new
industrial sites material to the Group as a whole or the changeof the location of existing activities that are material to the Group;■
approving decisions to invest and initiate programmes ﬁnancedby the Group, acquisition, divestment or sale decisions, in eachcase for an amount in excess of € 300 million;■
approving decisions to invest and initiate programmes ﬁnancedby the Group, acquisition, divestment or sale decisions, in eachcase for an amount in excess of € 800 million (Qualiﬁed Majority);■
approving decisions to enter into and terminate strategic alliancesat the level of the Company or at the level of one of its principal
subsidiaries (Qualiﬁed Majority);■
approving principles and guidelines governing the conductof the Group in matters involving non-contractual liabilities(like environmental matters, quality assurance, financial
announcements, integrity) as well as the corporate identity of
the Group;■

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approving any share buyback, cancellation (redemption) of
shares or the issuing of new shares or any similar measureleading to a change in the total number of voting rights in the
Company, except in the case of any buyback or cancellation(redemption) of shares if in the ordinary course of business (inwhich case the management of the Company will only informthe Directors before its implementation with a reasonable priornotice) (Qualiﬁed Majority);■
approving matters of shareholder policy, major actions or majorannouncements to the capital markets;■
approving decisions in respect of other measures and businessof fundamental signiﬁcance for the Group or which involves anabnormal level of risk;■
approving any proposal of names of candidates to succeed
active Directors made by the Remuneration and Nomination
Committee, after consultation with the Chairman of the Boardof Directors and the CEO, for submission to the shareholders’meeting; and■approving entering into and terminating cooperation agreements
at the level of the Company or at the level of one of its principal
subsidiaries having an impact on the share capital of theCompany or of the relevant subsidiary (Qualiﬁed Majority).
■

The Board of Directors must have a certain number of Directors
present or represented at a meeting to take action. This quorum
requirement depends on the action to be taken. For the Board of
Directors to make a decision on a Simple Majority matter, a majorityof the Directors must be present or represented. For the Boardof Directors to make a decision on a Qualiﬁed Majority matter, atleast ten (10) of the Directors must be present or represented. If
the Board of Directors cannot act on a Qualiﬁed Majority Matterbecause this quorum is not satisﬁed, the quorum would decrease
to eight (8) of the Directors at a new duly called meeting.
In addition to the Board Rules, the work of the Board of Directors
is governed by a Directors’ charter detailing the rights and dutiesof the Members of the Board of Directors, which was adopted inlight of corporate governance best practices.

114

The Directors’ Charter sets out core principles that bind each andevery Director, such as acting in the best interest of the Company
and its stakeholders, devoting necessary time and attention to
the carrying out of their duties and avoiding any and all conﬂicts
of interest.

Executive Committee Nomination and Composition
The CEO proposes all of the Members of the Executive Committee
for approval by the Board of Directors, after consultation with (a)the Chairman of the RNC and (b) the Chairman of the Board of
Directors, applying the following principles:the preference for the best candidate for the position;
the maintenance, in respect of the number of Members of the
Executive Committee, of the observed balance among thenationalities of the candidates in respect of the location of themain industrial centres of the Group (in particular among thenationals of the four (4) Member States of the European Union
where these main industrial centres are located); and■at least 2/3 of the Members of the Executive Committee, including
the CEO and the CFO, being EU nationals and residents. The
Board of Directors determines, by simple majority vote, whether
to approve all of the Members of the Executive Committee as
proposed by the CEO.
■■

Role of CEO and Executive Committee
The CEO is responsible for managing the day-to-day operationsof the Company. The Executive Committee (the “Executive
Committee”) supports the CEO in performing this task. The
Executive Committee Members shall jointly contribute to theoverall interests of the Company in addition to each member’s
individual operational or functional responsibility within the Group.
The CEO endeavours to reach consensus among the members of
the Executive Committee. In the event a consensus is not reached,
the CEO is entitled to decide the matter.

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4.1.2

Corporate Governance Arrangements in 2014

COMPOSITION OF THE BOARD OF DIRECTORS IN 2014

Age

Term started (as Memberof the Board of Directors)

Termexpires

Principal function

StatusDenis Ranque

63

2013

2016

Chairman of the Board of Directorsof Airbus Group N.V.

Non-Executive

Thomas Enders

56

2005, re-elected in 20132016

Chief Executive Officer of Airbus Group N.V.

Executive

Manfred Bischoff

72

2013

2016

Chairman of the Supervisory Board of Daimler AG

Non-Executive
Non-Executive

Name

Ralph D. Crosby

67

2013

2016

Former Member of the Management Boards of
EADS N.V. and of Northrop Grumman Corporation

Hans-Peter Keitel

67

2013

2016

Vice President of the Federationof German Industry (BDI)

Non-Executive

2016

Former Member of the Management Boardof Deutsche Bank AG

Non-Executive

Non-Executive

Hermann-Josef Lamberti

59

2007, re-elected in 2013

Anne Lauvergeon

55

2013

2016

Chairman and CEO of A.L.P S.A., Chairmanof the Board of Sigfox, and Chairmanof the French Innovation 2030 Committee

Lakshmi N. Mittal

64

2007, re-elected in 20132016

Chairman and Chief Executive Officer
of ArcelorMittal S.A.

Non-Executive

Sir John Parker

72

2007, re-elected in 20132016

Chairman of Anglo American PLC

Non-Executive

Michel Pébereau

73

2007, re-elected in 20132016

Honorary President of BNP Paribas
and Chairman of BNP Paribas Foundation

Non-Executive

2016

Vice-Chairman and CEO of Obrascón
Huarte Lain (OHL)

Non-Executive

2016

Honorary Governor of Banque de France
and former Presidentof the European Central Bank

Non-Executive

Josep Piqué i Camps

Jean-Claude Trichet

60

72

2012, re-elected in 20132012, re-elected in 2013

Note: Status as of 1 March 2015. The professional address of all Members of the Board of Directors for any matter relating to Airbus Group is Mendelweg 30, 2333 CS Leiden, the Netherlands.

The Company has not appointed observers to the Board of
Directors. Pursuant to applicable Dutch law, the employees are
not entitled to elect a Director. There is no minimum number ofshares that must be held by a Director.

Curriculum Vitae and other Mandates and Duties
Performed in any Company by the Members of theBoard of Directors in 2014
Denis RanqueDenis Ranque began his career at the French Ministry for Industry,where he held various positions in the energy sector, before joining
the Thomson group in 1983 as Planning Director. The following year,
he moved to the electron tubes division, ﬁrst as Director of spacebusiness, then, from 1986, as Director of the Division’s microwave
tubes department. Two years later, the electron tubes divisionbecame the afﬁliate Thomson Tubes Électroniques, and Denis
Ranque took over as Chief Executive of this subsidiary in 1989.
In April 1992, he was appointed Chairman and CEO of Thomson
Sintra Activités Sous-marines. Four years later, he became CEOof Thomson Marconi Sonar, the sonar systems joint venture set
up by Thomson-CSF and GEC-Marconi. In January 1998, Denis
Ranque was appointed Chairman and Chief Executive Ofﬁcerof the Thomson-CSF group, now called Thales. He resigned

from this position in May 2009, as a consequence of a change inshareholding. From February 2010 to June 2012 he has been NonExecutive Chairman of Technicolor. Since October 2001, he has
also been Chairman of the Board of the École des Mines ParisTech,and since September 2002, Chairman of the Cercle de l’Industrie,
an association which unites France’s biggest industrial companies;
both mandates ended in June 2012. He is Member of the Boardsof Directors of Saint-Gobain and CMA-CGM. Since October 2013,
he chairs The Haut Comité de Gouvernement d’Entreprise, thenewly created independent body put in place by the French Codeof corporate governance for monitoring and encouraging progressin this ﬁeld. Since 2014 he is also co-Chairman of La Fabriquede l’industrie, a think tank dedicated to industry. Denis Ranque,born 1952, is a graduate of France’s École Polytechnique and theCorps des Mines.

4

Current mandates in addition to the one listed in the chart above
are set forth below:
Member of the Board of Directors of Saint Gobain;
Member of the Board of Directors of CMA-CGM;■
Member of the Board of Directors of Scilab Enterprise SAS;■
President of the French Haut Comité de Gouvernementd’Entreprise;■
President of the Board of Fondation de l’Ecole Polytechnique.
■■

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Former mandates for the last ﬁve years:
Director of CGG VERITAS (2010 to 2012);■
Director of CMA CGM (2009 to 2012);■
Director of Fonds Strategique d’Investissement (2011 to 2012);■
Chairman of Technicolor (2010 to 2012).
■

Tom Enders
Thomas (“Tom”) Enders was appointed Chief Executive Ofﬁcer(CEO) of Airbus Group, effective 1 June 2012, after having been
CEO of Airbus since 2007. Before that he served as Co-CEO of
EADS between 2005 and 2007. He was Head of the Group’s
Defence division 2000-2005. He studied Economics, Political
Science and History at the University of Bonn and at the Universityof California in Los Angeles. Prior to joining the aerospaceindustry in 1991, Mr Enders worked, inter alia, as a Member of
the “Planungsstab” of the German Minister of Defence. He has
been member of the Executive Committee of Airbus Group since
its creation in 1999. Mr Enders was President of the BDLI (German
Aerospace Industry Association) from 2005 to 2012. He is memberof the BDI Presidential Board (German Industry Association) since2009. From 2005 to 2009 he was Chairman of the Atlantik-Brücke
e.V. In 2014, Mr Enders joined the Advisory Council of the Munich
Security Conference as well as the Senate of the Max-PlanckGesellschaft. Since 2011, Tom Enders is member of the Business
Advisory Group of UK Prime Minister David Cameron. He sits on
the Joint Advisory Council of Allianz SE since 2013.
Current mandates in addition to the one listed in the chart above
are set forth below:
Member of the Executive Committee of Airbus Group;
Chairman of the Shareholder Committee of Airbus SAS;■
Chairman of the Supervisory Board of Airbus Helicopters SAS;■
Chairman of the Supervisory Airbus DS Holding B.V.;■
Chairman of the Supervisory Board of Airbus Defence and Space
Deutschland GmbH;■
Member of the Board of Directors of the BDI (Federation ofGerman Industry);■
Member of the Governing Board of HSBC Trinkhaus;■
Member of the International Advisory Board of Atlantic Councilof the US;■
Member of the Joint Advisory Council of Allianz SE.
■■

Former mandates for the last ﬁve years:
President and Chief Executive Ofﬁcer of Airbus SAS from 20072012;■
President of the BDLI (Bundesverband der deutschen Luft- undRaumfahrtindustrie e.V.) from 2005-2012;■
Chairman of the Advisory Council for Aeronautics Research andInnovation in Europe (ACARE) from 2011-2013.
■

Manfred Bischoff
Manfred Bischoff was born 22 April 1942. He holds a diploma and
PhD in Economics from the University of Heidelberg. Having joined
Daimler-Benz AG in 1976, Mr Bischoff became Chief Financial
Ofﬁ cer of Mercedes-Benz do Brasil in 1988. In 1989, he wasappointed to the Board of Management of Deutsche Aerospace(later DaimlerChrysler Aerospace AG) as CFO and in 1995 became
Chairman of the Board of Management of Daimler-Benz Aerospace

116(later Daimler Chrysler Aerospace AG) and a Member of the Boardof Management of Daimler-Benz AG. At the foundation of EADS in
2000, Mr Bischoff became its Chairman, a position he held until
April 2007, when he was elected Chairman of the Supervisory
Board of DaimlerChrysler AG. Currently, Manfred Bischoff is also
Member of the Board of Unicredit S.p.A., and Member of theSupervisory Board of SMS GmbH.
Current mandates in addition to the one listed in the chart above
are set forth below:
Chairman of the Supervisory Board Daimler AG;
Member of the Supervisory Board SMS GmbH;■
Member of the Board of Directors Unicredit S.p.A.;■
Multiple memberships in non-proﬁt Boards.
■■

Former mandates for the last ﬁve years:
Member of the Supervisory Board Fraport AG (until May 2012);
Member of the Supervisory Board KPN N.V. (until April 2013);■
Chairman of the Supervisory Board and Chairman of the
Shareholder Committee Voith GmbH (until September 2014).
■■

Ralph Dozier Crosby
Ralph Crosby was Member of the Executive Committee of EADS
from 2009-2012 and served as Chairman and CEO of EADS North
America from 2002-2009. He presently serves as an Independent
Director of American Electric Power headquartered in Columbus,
Ohio, where he chairs the Human Resources Committee; andSerco, headquartered in London, United Kingdom. Furthermore,
Mr Crosby serves on the Board of Directors, and Executive
Committee of the Atlantic Council of the United States. Prior tojoining EADS, Mr Crosby was an Executive with Northrop Grumman
Corporation, where he had served as a Member of the Corporate
Policy Council with positions including President of the Integrated
Systems Sector, Corporate Vice President and General Managerof the company’s Commercial Aircraft Division and Corporate Vice
President and General Manager of the B-2 Division. Prior to his
industry career, Mr Crosby served as an ofﬁcer in the US Army,
where his last military assignment was as military staff assistant to
the Vice President of the United States. Mr Crosby is a graduateof the US Military Academy at West Point, and holds Master’s
degrees from Harvard University, and the University of Geneva,
Switzerland. He is the recipient of the James Forrestal Award fromthe National Defense Industrial Association, and has been awarded
Chevalier of the Légion d’Honneur of France.
Current mandates in addition to the one listed in the chart above
are set forth below:
Member of the Board of Directors (Supervisory Board) of
American Electric Power Corporation;■
Member of the Board of Directors (Supervisory Board) of Serco,
PLC.;■
Member of the Board of Directors and Member of the Executive
Committee of the Atlantic Council of the United States.
■

Former mandates for the last ﬁve years:
Executive Chairman of EADS North America (retired 31 December2011);■
Member of the Board of Directors (Supervisory Board) of
Ducommun Corporation (resigned June 2013).
■

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Hans-Peter Keitel
Hans-Peter Keitel served as President of the Federation of German
Industries (BDI) from 2009 to 2012 and now (since 2013) serves as
one of its Vice Presidents. Prior to this he served nearly 20 years
at Hochtief — ﬁ rst as Director for International Business andsubsequently from 1992 to 2007 as Chief Executive Ofﬁcer. He
started his career in 1975 at Lahmeyer International as a technicalAdvisor and project manager being involved in large scale global
infrastructure projects in over 20 countries. He also advised thearranging banks of the Channel Tunnel Consortium. Mr Keitel
has graduated from the Universities of Stuttgart and Munich inConstruction Engineering and Economics and has received a PhD
in Engineering from the University of Munich.
Current mandates in addition to the one listed in the chart above
are set forth below:
Member of the Supervisory Board of RWE AG;
Member of the Supervisory Board of Voith GmbH;■
Member of the Supervisory Board of ThyssenKrupp AG;■
Member of the Supervisory Board of Commerzbank AG (until
20 May 2014);■
Member of the Supervisory Board of National-Bank AG.
■■

Former mandates for the last ﬁve years:■■

Member of the Supervisory Board of Hochtief AG;
Member of the Supervisory Board of Deutsche Messe AG.

Hermann-Josef Lamberti
Hermann-Josef Lamberti was Member of the Management Boardof Deutsche Bank AG from 1999 until 2012 and operated as thebank’s Chief Operating Ofﬁcer. As COO he had global responsibility
for Human Resources, Information Technology, Operations andProcess Management, Building and Facilities Management as wellas Purchasing. He joined Deutsche Bank in Frankfurt in 1998 as
Executive Vice President. From 1985, he held various management
positions within IBM, working in Europe and the United States, inthe ﬁelds of controlling, internal application development, sales,
personal software, marketing and brand management. In 1997,
he was appointed Chairman of the Management of IBM Germany.
Mr Lamberti started his career in 1982 with Touche Ross in Toronto,
before joining the Chemical Bank in Frankfurt. He studied Business
Administration at the Universities of Cologne and Dublin, andgraduated with a Master’s degree.
Current mandates in addition to the one listed in the chart above
are set forth below:
Chairman of the Society of Freunde der Bachwoche Ansbache.V.;■
Member of the Board of Trustees of Institute for Law and FinanceFrankfurt;■
Member of the Board of Directors of Airbus Group N.V.;■
Chairman of the Advisor y Board: Wir tschaf tsinitiative
FrankfurtRheinMain e.V.;■
Member of the Board of Trustees of Johann Wolfgang GoetheUniversität Fachbereich Wirtschaftswissenschaften and Memberof the Board of Trustees of Frankfurt Institute for Advanced
Studies (FIAS) of Goethe-Universität;■
Member of the Supervisory Board ING Group N.V.;■

Senior Business Advisor Advent International GmbH;
Member of the Supervisory Board Open-Xchange AG;■
Owner/Managing Director Frankfurt Technology Management
GmbH.
■
■

Former mandates for the last ﬁve years:
Executive Customer of the Advisory Council of Symantec
Corporation (resigned 12 May 2010);■
Member of the Board of Trustees of Baden-Badener
Unternehmergespräche – Gesellschaft zur Förderung desUnternehmensnachwuchses e.V. (resigned 13 May 2010);■
Member of the Board of Trustees of Wallraf-Richartz-Museum
und Museum Ludwig e.V. (resigned 31 January 2011);■
Member of the Founder Council of Wallraf-Richartz-Museum(resigned 31 January 2011); and■Member of the Senate of Fraunhofer Gesellschaft. (resigned
31 December 2011); and■Member of the Management Board of Deutsche Bank AG(resigned 31 May 2012);■
Member of the Supervisory Board of BVV Versicherungsverein
des Bankgewerbes A.G. und BVV Versorgungskasse desBankgewerbes e.V. (resigned 21 June 2012);■
Member of the Supervisory Board of Deutsche Börse AG(resigned 16 May 2012);■
Member of the Supervisory Board of Deutsche Bank Privat-undGeschäftskunden AG (resigned 24 May 2012);■
Member of the Board of Management of Arbeitgeberverband
des privaten Bankgewerbes e:V. (resigned 21 June 2012);■
Deputy member of the Deposit Insurance Committee of
Bundesverband deutscher Banken e:V. (resigned 21 June 2012);■
Delegate of the Delegates’ Assembly of the Deposit InsuranceCommittee of Bundesverband deutscher Banken e.V. (resigned
21 June 2012);■
Member of the Financial Community Germany Committee of
Bundesverband deutscher Banken e.V. (resigned 21 June 2012);■
Member of the Board of Management of Deutsches Aktieninstitut
e.V. (resigned 21 June 2012);■
Member of the Board of Trustees of e-Finance Lab Frankfurt am
Main (resigned 31 May 2012);■
Member of the Stock Exchange Council of Eurex Deutschland(resigned 31 May 2012);■
Member of the Stock Exchange Council of Frankfurter
Wertpapierbörse AG (resigned 31 May 2012);■
Member of the Advisory Board of Institut für Unternehmensplanung– IUP (resigned 31 May 2012);■
Member of the Board of Trustees of Junge Deutsche Philharmonie(resigned 8 October 2012);■
Deputy Chairman of the Board of Trustees of the Society ofPromotion of Kölner Kammerorchester e.V. (resigned 31 May
2012);■
Member of the Programme Advisory Board of LOEWE LandesOffensive zur Entwicklung Wissenschaftlich-ökonomischer
Exzellenz des Hessischen Ministeriums für Wissenschaft und
Kunst (resigned 14 June 2012);■
Member of the Advisory Circle of Münchner Kreis (resigned
31 May 2012);■

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Deputy member of the Advisory Board of Prüfungsverband
deutscher Banken e.V. (resigned 31 May 2012);■
Member of the Administrative Council of Universitätsgesellschaft
Bonn-Freunde, Förderer, Alumni (resigned 31 May 2012);■
Member of the Advisory Board in the centre for market-orientatedcorporate management of WHU (resigned 31 May 2012);■
Member of the Commission of Börsensachverständigenkommission (Bundesﬁnanzministerium) (resigned 31 May 2012);■
Member of the Management Board and Member of the Executive
Committee of Frankfurt Main Finance e.V. (resigned 31 May 2012);■
Member of the Advisory Board of Fraunhofer-IUK-Verbund(resigned 31 May 2012);■
Member of the Executive Committee and of the Steering
Committee of Frankfurt RheinMain e.V. (resigned 31 May 2012);■
Member of the Senate of acatech – Deutsche Akademie derTechnikwissenschaften e.V. (resigned 31 May 2012);■
Member of the Board of Directors of American Chamber ofCommerce in Germany (resigned 11 May 2012);■
Member of the Board of Trustees of Hanns Martin SchleyerStiftung (resigned 21 June 2012);■
Member of the Editorial Board of scientific journal“Wirtschaftsinformatik” (resigned 31 May 2012);■
Member of the International Advisory Board of IESE Business
School, University of Navarra (resigned 28 March 2012);■
Member of the Board of Trustees of Stiftung Lebendige Stadt(resigned 31 May 2012);■
Member of the Supervisory Board of Carl Zeiss AG (resigned
18 March 2013);■
Member of the University Council of the University of Cologne(resigned 6 June 2013);■
Member of the Steering Committee and of the Federal Committeeof Wirtschaftsrat der CDU e.V. (resigned 25 June 2013);■
Member of the Managing Committee of the Institut fürWirtschaftsinformatik der HSG of the Universität St. Gallen(resigned 31 December 2013);■
Member of the Board of Trustees of the Frankfurt International
School e.V.; (resigned 31 December 2013);■
Member of the Advisory Board of Barmenia VersicherungenWuppertal (resigned 31 December 2014).
■

Anne Lauvergeon
Anne Lauvergeon is a graduate of the École Normale Supérieureand the French National School of Mining Engineer. She holds anadvanced degree in Physics & Chemistry. From 2011 to 2014, Mrs
Lauvergeon was Partner of Efﬁciency Capital, a fund dedicatedto technology and natural resources. She was CEO of Areva from
July 2001 to June 2011, and Chairman and CEO of Areva NC from
June 1999 to July 2011. In 1997, she worked at Alcatel as Senior
Executive Vice President, member of the Executive Committee,
in charge of international business and industrial holdings. From1995 to 1997 she was Partner of Lazard Frères & Cie. Before that,from 1990 to 1995, she worked for the French President’s ofﬁce,
in charge of international economy and foreign trade missions in
1990, then as Deputy Chief of Staff and personal representative to
the French President, in charge of the G7/G8 Summits’ from 1991.
Anne Lauvergeon began her career in 1983 in the steel industry,at Usinor, before working on nuclear & chemical safety issues in

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Europe at the French Atomic Energy Commission. Mrs Lauvergeon
is Doctor Honoris Causa of the Imperial College, London (2008),
Fellow of the Royal Academy of Engineering (UK 2011) and Fellowof the Royal Academy of Belgium (2012).
Current mandates in addition to the one listed in the chart above
are set forth below:
Member of the Board of Directors of TOTAL S.A.;
Member of the Board of Directors of AMERICAN EXPRESS;■
Member of the Board of Directors of RIO TINTO;■
Member of the Board of Directors of SUEZ ENVIRONNEMENT;■
Chairman of the Board of Directors of École Nationale Supérieuredes Mines de Nancy;■
Member of the Board of Directors of PSL University (Paris
Sciences et Lettres);■
Chairman of A2i fund Agir pour l’Insertion dans l’Industrie (Union
des Industries Métallurgiques et Minières);■■

Former mandates for the last ﬁve years:
CEO of AREVA (resigned June 2011);
Chairman and CEO of AREVA NC (resigned July 2011);■
Member of the Executive Committee of Mouvement desEntreprises de France (resigned in 2012);■
Member of the Board of GDF SUEZ (resigned April 2012);■
Member of the Trilateral Commission (resigned in 2013);■
Member of the Executive Committee of Global Compact(resigned July 2013);■
Board member of VODAFONE Plc (resigned July 2014);■
Chairman of the Supervisory Board of the French newspaper
LIBERATION (resigned February 2014).
■■

Lakshmi N. Mittal
Lakshmi N. Mittal is the Chairman and CEO of Arcelor Mittal. He
founded Mittal Steel Company in 1976 and led its 2006 merger
with Arcelor to form ArcelorMittal, the world’s largest steelmaker.
He is widely recognised for his leading role in restructuring the
global steel industry, and has over 35 years’ experience working
in steel and related industries. Among his manifold mandates,
Mr Mittal is Member of the Board of Directors of Goldman Sachs,of the World Economic Forum’s International Business Council,
and of the Foreign Investment Council in Kazakhstan. Furthermore,
he has been awarded numerous recognitions from international
institutions and magazines and is closely associated with a numberof non-proﬁt organisations.
Current mandates in addition to the one listed in the chart above
are set forth below:
Chairman of the Board of Directors and CEO of ArcelorMittal S.A.;
Chairman of the Board of Directors of Aperam S.A.;■
Member of the Board of Directors of Goldman Sachs;■
Member of the Executive Committee of World Steel Association;■
Member of the World Economic Forum’s International BusinessCouncil;■Member of the Foreign Investment Council in Kazakhstan;■Member of Board of Trustees of Cleveland Clinic;■
Member of Executive Board of Indian School of Business;■
Governor of ArcelorMittal Foundation;■
Trustee of Gita Mittal Foundation;■■

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Trustee of Gita Mohan Mittal Foundation;
Trustee of Lakshmi and Usha Mittal Foundation;■
Chairman of Governing Council of LNM Institute of Information
Technology;■
Trustee of Mittal Champion Trust;■
Trustee of Mittal Children’s Foundation.
■■

Former mandates for the last ﬁve years:
Member of the Board of Directors of ICICI Bank Limited (resigned
May 2010);■
Member of the Board of Commonwealth Business Council
Limited (resigned February 2011);■
Member of the Business Council (resigned December 2011);■
Member of the Managing Committee of Lakshmi Niwas andUsha Mittal Foundation (resigned December 2011);■
Member of the Board of ArcelorMittal USA Inc. (resigned
September 2012);■
Member of the Presidential International Advisory Board ofMozambique;■
Member of the Advisory Board of the Kellogg School ofManagement;■
President of Ispat Inland ULC (resigned January 2013);■
Member of the Prime Minister of India’s Global Advisory Council;■
Member of President’s Domestic and Foreign Investors Advisory
Council, Ukraine;■
Gold Patron of Prince’s Trust;■Member of the Board of ONGC Mittal Energy Ltd.;■
Member of the Board of ONGC Mittal Energy Services Ltd.
■

Sir John Parker
Sir John Parker is Chairman of Anglo American PLC, Deputy
Chairman of DP World (Dubai), Non-Executive Director of Carnival
PLC and Carnival Corporation. He has completed his term 20112014 as President of the Royal Academy of Engineering. He stepped
down as Chairman of National Grid PLC in December 2011. His
career has spanned the engineering, shipbuilding and defence
industries, with some 25 years’ experience as CEO including
Harland & Wolff and the Babcock International Group. He alsochaired the Court of the Bank of England between 2004 and2009. Sir John Parker studied Naval Architecture and MechanicalEngineering at the College of Technology, Queens University,
Belfast.
Current mandates in addition to the one listed in the chart above
are set forth below:
Director of Carnival PLC and Carnival Corporation;■
Deputy Chairman of D.P. World (Dubai);■
Director of White Ensign Association Limited;■
President of the Royal Academy of Engineering;■
Visiting fellow of the University of Oxford.
■

Former mandates for the last ﬁve years:
Chancellor of the University of Southampton (resigned July 2011);
Member of the International Advisory Board of Citigroup(dissolved December 2011);■
Chairman of National Grid PLC (resigned January 2012).
■■

Michel Pébereau
Michel Pébereau was Chairman of the Board of BNP Paribas
between 2003 and 2011. He presided over the merger that created
BNP Paribas in 2000, becoming Chairman and Chief Executive
Ofﬁcer (CEO). In 1993, he was appointed Chairman and CEO of
the Banque Nationale de Paris and privatised it. Previously, he
was Chairman and CEO of the Crédit Commercial de France. He
started his career in 1967 at the Inspection Générale des Finances.
In 1970 he joined the French Treasury, where he held various highranking posts. Mr Pébereau is an alumnus of the École Nationaled’Administration and of the École Polytechnique.
Current mandates in addition to the one listed in the chart above
are set forth below:
Manager of “MJP Conseil”;
Chairman of the Board of “Fondation BNP Paribas”;■
Chairman of “Centre des Professions Financières”;■
Chairman of the Board of “Fondation ARC pour la Recherche
sur le Cancer“;■
Member of the Board of Directors of “BNP Paribas S.A.”;■
Member of the Board of Directors of “Total S.A.”;■
Member of the Board of Directors of “Pargesa Holding S.A.”,
Switzerland;■Member of the Board of Directors of “BNP Paribas (Suisse) S.A.”;■
Vice Chairman and Member of the Supervisory Board of “Banque
Marocaine pour le Commerce et l’Industrie”, Morocco;■
Member of the Executive Committee of “Institut de l’Entreprise”;■
Member of the “Académie des Sciences Morales et Politiques”;■
Member of “Fondation Nationale des Sciences Politiques”;■
Member of the “Conseil d’orientation Strategique of Mouvement
des Entreprises de France”;■
Chairman of the Strategic Board of « ESL Network (SAS);■
Partner of “Paris fait son cinéma (SAS)”;■
Honorary President of CCF (now HSBC France);■
Member of “Centre National Éducation Économie (CNEE)”;■
Member of the Sponsoring Committee of “Cercle Jean-Baptiste
Say”;■
Chairman of “Club des partenaires of TSE”;■
Member of the Sponsoring Committee of “Collège desBernardins”;■
Member of the Board Directors of “Fondation Jean-Jacques
Laffont – TSE”;■
Chairman of the Strategic Board of « Institut Vaucanson”.
■■

4

Former mandates for the last ﬁve years:
Censor of “Galeries Lafayette S.A.”;
Member of the Board of Directors of Lafarge (until May 2011);■
Chairman of the Board of Directors of BNP Paribas (until
December 2011);■
Member of the Board of Directors of Axa (until April 2013);■
Member of the Board of Directors of Saint-Gobain (until
June 2013);■
Member of the Supervisory Board of “Institut Aspen France”.
■■

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Josep Piqué i Camps
Josep Piqué i Camps resigned as Non-Executive Chairman of
Vueling in 2013, and took over the position of Vice-Chairman
and CEO of Obrascón Huarte Lain (OHL), one of the largest
international concession and construction groups. He started
his career as an economist of the studies service “la Caixa” andbecame General Director of the Catalan Industry in 1986. Two years
later, he joined the company Ercros, where he eventually became
CEO and Chairman. After serving several years within the Circleof Economics of Barcelona, he led it as Chairman (1995-96). In
the following, Mr Piqué was successively appointed Minister for
Industry and Energy (1996-00), Government Spokesperson (199800), Minister of Foreign Affairs (2000-02) and Minister of Scienceand Technology (2002-03). Furthermore to his engagements, heserved as Deputy, Senator and President of the Popular Partyof Catalonia (2003-07). Mr Piqué holds a PhD in Economic andBusiness Studies and is a Law graduate from the University ofBarcelona, where he also serves as lecturer of Economic Theory.
Current mandates in addition to the one listed in the chart above
are set forth below:
Vice-Chairman and CEO of Obrascón Huarte Lain (OHL);
Advisory Board of Seat, Volkswagen Group;■
Chairman of Spain–Japan Council Foundation;■
Member of the Board of Directors of Plasmia Biotech, S.L.;■
Member of the Board of Directors of Circulo de Economia.
■■

Former mandates for the last ﬁve years:
Chairman of Mixta Africa until 2010;
Member of the Board of Directors of Applus Technologies
Holding, S.L. until 2012;■
Chairman of Vueling until 2013;■
Member of the Board of Directors of Ezentis, S.A. until 2013;■
Member of the Board of Directors of Grupo San Jose, S.A.
until 2013;■
Chairman of Tres60 Servicios Audiovisuales, S.A.
■■

Jean-Claude Trichet
Jean-Claude Trichet was President of the European Central Bank,of the European Systemic Risk Board and of the Global Economy
meeting of Central Bank Governors in Basel until the end of 2011.
Previously, he was in charge of the French Treasury for six years
and was Governor of Banque de France for ten years. Earlier in his
career, he held positions within the French Inspection Générale desFinances, as well as the Treasury department, and was Advisor
to the French President for microeconomics, energy, industry
and research (1978-81). Mr Trichet graduated from the École desMines de Nancy, the Institut d’Études Politiques de Paris andthe University of Paris in Economics, is a Doctor Honoris Causa
of several universities and an alumnus of the École Nationaled’Administration.
Current mandates in addition to the one listed in the chart above
are set forth below:
■
■

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Chairman of the Board of Directors of the BRUEGEL Institute,
Washington DC (non-proﬁt organisation);■
European Chairman of the Trilateral Commission (non-proﬁ torganisation).
■

President of “JCT Conseil, Paris”;
Chairperson of the G30 (non-proﬁt organisation), Washington
D.C.;

Former mandates for the last ﬁve years:
President of the European Central Bank (end of mandate
1 November 2011);■
President of the Global Economy meeting of Central Bank
Governors in Basel (end of mandate 1 November 2011);■
President of the European Systemic Risk Board (end of mandate
01 November 2011);■
President of the Group of Governors and Heads of Supervision(GHOS) (end of mandate 01 November 2011);■
President of SOGEPA -Société de Gestion de Participations
Aéronautiques- (from 2012 up to 2013).
■

Independent Directors
The Independent Directors appointed pursuant to the criteria of
independence set out above are Denis Ranque, Manfred Bischoff,Hans-Peter Keitel, Hermann-Josef Lamberti, Anne Lauvergeon,
Lakshmi N. Mittal, Sir John Parker, Michel Pébereau, Josep Piqué
I Camps and Jean-Claude Trichet.

Prior Offences and Family Ties
To the Company’s knowledge, none of the Directors (in either
their individual capacity or as Director or senior manager of
any of the entities listed above) has been convicted in relation
to fraudulent offences, been the subject of any bankruptcy,
receivership or liquidation, nor been the subject of any ofﬁcial
public incrimination and/or sanction by a statutory or regulatory
authority, nor been disqualiﬁed by a court from acting as a Memberof the administrative, management or supervisory bodies of any
issuer or conduct of affairs of any company, during at least thelast ﬁve years. As of the date of this document, there are no familyties among any of the Directors.

Operation of the Board of Directors in 2014
Board of Directors Meetings
The Board of Directors met 7 times during 2014 and was regularly
informed of developments through business reports from the
Chief Executive Ofﬁcer, including progress on the strategic andoperational plans. The average attendance rate at these meetings
was at 88%.
Throughout 2014, the Board of Directors received reports on thetechnical and commercial progress of signiﬁcant programmes,
such as A350 XWB, A400M, A380 and Super Puma. During two offsite Board meetings, one in Marignane at Airbus Helicopters, andthe other in Toulouse at Airbus, the Board seized the opportunity
to meet with local management and with the operative workforce,
visited the Super Puma ﬁnal assembly line, was introduced to theX6-helicopter concept, and experienced a ﬂight on the A350 XWB
on the day of its certiﬁcation.

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In terms of making new decisions, the Board launched a new engine
option (neo) of the A330, conducted a detailed and comprehensive
product portfolio assessment in line with the Group’s strategy
review initiated in 2013, approved and monitored Airbus Group’s
joint venture with Safran, and decided on the divestment of a partof the Company’s stake in Dassault Aviation.
Moreover, the Board of Directors focused on the Group’s ﬁnancial
results and forecasts, asset management, supply chain challenges,
the services business, compliance in key business processes
and in major programmes, as well as efﬁciency and innovation
initiatives. It reviewed Enterprise Risk Management results, theinternal audit plan, compliance programme, litigation and legalrisks, investor relations, ﬁnancial communication and dividend
policy.
In order to avoid large bloc replacements of Directors in one single
episode, with the corresponding loss of experience, induction
and integration challenges, the Board of Directors discussed andenvisaged a smoother, yearly replacement schedule; besides, theBoard of Directors has adopted criteria limiting the appointmentof a Director to a maximum of three consecutive terms of three
years each (with possible exceptions), and setting an age limit ofseventy ﬁve years at the time of appointment. The Board perceives
this to be the ﬁrst step to a more optimal turnover of the Boardof Directors, the principle of which is embodied in the provisionsof the Internal Rules of the Board of Directors. Further steps to
implement the staggered Board will be proposed at the AGM of2016 to create a schedule of staggered retirements and inductions
consistent with the Dutch Corporate Governance Code and withthe present Internal Rules of the Board of Directors.
BOARD ATTENDANCE

Directors

Attendance

Number of meetings in 2014

7

Denis Ranque (Chairman)

7/7

Thomas Enders (CEO)7/7

Manfred Bischoff

5/7

Ralph D. Crosby

7/7

Hans-Peter Keitel

6/7

Hermann-Josef Lamberti

7/7

Anne Lauvergeon

6/7

Lakshmi N. Mittal

6/7

Sir John Parker

7/7Michel Pébereau

6/7

Josep Piqué i Camps

3/7

Jean-Claude Trichet

7/7

Board Evaluation 2014
The evaluation of the Board of Directors was conducted throughDecember 2014 and January 2015 by Spencer Stuart, throughindividual interviews of all board members. The interviews covered
the Directors’ expectations, governance ﬁt, board effectiveness,board composition, committees as viewed from the Board and as
viewed by their members, board areas of expertise and working
processes, chairmanship, interaction with executive management,
shareholders, and stakeholders. The subsequent discussion of thereport by the whole board was action-oriented.
Board members were unanimous in ﬁnding that the Board meetsthe highest standards internationally, and to point out the steadyprogress made by the Board, especially since the implementationof the new governance, which is considered balanced and effective.
Board dynamics and performance are rated high. The Board’s
decision-making process ﬁts both Directors’ and management’s
expectations, and the contribution of Board Committees is high.
Mutual trust between board and management is strong.
Several improvement suggestions emerged from the interviews.
support documentation and form:
make minutes of previous meetings and board ﬁles of upcoming
meetings available earlier,enrich the ﬂow of information sent between board meetings,
make presentations shorter and more analytical;■
speakers and guests, restricted sessions as best-practice:increase opportunities for the Board to meet the managementof Business Units, for instance in the context of meetings held
at industrial sites,
institutionalise such practices as routinely scheduled Boardonly or Non-Executive Directors’ time-slots;■
content:
better involve board members in the preparation of the strategic
session of the Board,
improve ability to react to unforeseen events,
revisit and analyse past key decisions and their implementation.
■

■

■

■

■

■

■

■

■

4

One upcoming focus of the Board will be the preparation of Director
turnover and replacement, as senior members progressively handover to new Directors. Gender and geographical diversity, as well
as speciﬁc industry speciﬁc skills will be key criteria to satisfy
as the Remuneration and Nomination Committee organises its
search of candidates.

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Board Committees in 2014
In 2014, membership on Board Committees was as follows:
Directors

Audit Committee

Remuneration & Nomination Committee

Denis Ranque (Chairman)
Thomas Enders (CEO)Mansfred Bischoff
Ralph D. Crosby
Hans-Peter Keitel

X

Hermann-Josef Lamberti

ChairmanAnne Lauvergeon

X

Lakshmi N. MittalX

Sir John Parker

ChairmanMichel Pébereau

X

Josep Piqué i CampsX

Jean-Claude Trichet

X

Number of meetings in 2014
Average attendance rate in 2014

4

3

75%

83%

Note: Status as of 1 March 2015.

The Audit Committee
Pursuant to the Board Rules, the Audit Committee makes
recommendations to the Board of Directors on the approvalof the annual ﬁnancial statements and the interim (Q1, H1, Q3)
accounts, as well as the appointment of external auditor and thedetermination of his remuneration. Moreover, the Audit Committee
has the responsibility for ensuring that the internal and external
audit activities are correctly directed and that audit matters are
given due importance at meetings of the Board of Directors. Thus,
it discusses with the auditors their audit programme and theresults of the audit of the accounts and it monitors the adequacyof the Group’s internal controls, accounting policies and ﬁnancial
reporting. It also oversees the operation of the Group’s ERM systemand the Compliance Organisation.
The rules and responsibilities of the Audit Committee are set out
in the Audit Committee Charter.
The Chairman of the Board of Directors and the Chief Executive
Ofﬁcer are invited to attend meetings of the Audit Committee. The
Chief Financial Ofﬁcer and the Head of Controlling & Accounting arerequested to attend meetings to present management proposals
and to answer questions. Furthermore, the Head of Corporate
Audit and the Chief Compliance Ofﬁcer are requested to reportto the Audit Committee on a regular basis.
The Audit Committee is required to meet at least four times a year.
In 2014, it fully performed all of the above described duties, andmet four times with an average attendance rate of 75%.

The Remuneration and Nomination Committee
Pursuant to the Board Rules, the Remuneration and Nomination
Committee makes recommendations to the Board of Directors
regarding the appointment of members of the Group Executive
Committee (upon proposal by the Chief Executive Ofﬁcer andapproval by the Chairman); the Company’s Corporate Secretary; the122members of the Airbus Shareholder Committee; and the chairmenof the Supervisory Board (or similar organ) of other important Group
member companies and Business Units. The Remuneration and
Nomination Committee also makes recommendations to the Boardof Directors regarding remuneration strategies and long-term
remuneration plans and decides on the service contracts and othercontractual matters in relation to the Board of Directors and Group
Executive Committee Members. The rules and responsibilities of
the Remuneration and Nomination Committee have been set out
in the Remuneration and Nomination Committee Charter.
The Chairman of the Board of Directors and the Chief Executive
Ofﬁcer are invited to attend meetings of the Remuneration and
Nomination Committee. The Head of Airbus Group Human
Resources is requested to attend meetings to present management
proposals and to answer questions.
In addition to making recommendations to the Board of Directors
for major appointments within the Group, the Remuneration and
Nomination Committee reviews top talents, discusses measures
to improve engagement and to promote diversity, reviews the
remuneration of the Group Executive Committee Members forthis year, the Long-Term Incentive Plan, and the variable pay forthe previous year.
The guiding principle governing management appointments in
the Group is that the best candidate should be appointed tothe position (“best person for the job”), while at the same timeseeking to achieve a balanced composition with respect togender, experience, national origin, etc. The implementation ofthese principles should, however, not create any restrictions on
the diversity within the Company’s executive management team.
The Remuneration and Nomination Committee is required to meetat least twice a year. In 2014, it fully performed all of the above
described duties and met three times with an average attendance
rate of 83%.

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Executive Committee in 2014
The Chief Executive Ofﬁcer, supported by an Executive Committee,
is responsible for managing the day-to-day operations of theCompany. The Executive Committee is chaired by the Chief
Executive Ofﬁcer and its members are appointed on the basis of
their performance of their individual responsibilities as well as theirrespective contribution to the overall interest of the Airbus Group.
The Executive Committee met 5 times during 2014.
Amongst others the following matters are discussed at the
Executive Committee meetings:
appointment by the heads of the Airbus Group Divisions andfunctions of their management teams;■
major investments;■
setting up and control of the implementation of the strategy for
the Group’s businesses;■
Airbus Group policy matters and management and organisational
structure of the business;■
performance level of the Group’s businesses and support
functions; and■all business issues, including the operational plan of the Groupand its Divisions and Business Units.
■

The Executive Committee m embers are responsible to jointly
contribute to the overall interests of the Group, in addition to eachmember’s individual operational or functional responsibility. In
their management of the operations of the Airbus Group, the CEO
and the Executive Committee are overseen and supported by the
Board and in particular by the Chairman.

The Chief Executive Officer endeavors to reach consensus
among the members of the Executive Committee. In the eventa consensus cannot be reached, the Chief Executive Ofﬁcer isentitled to decide the matter. Such decision shall be binding on
the members of the Executive Committee. If there is a fundamental
or signiﬁcant disagreement with respect to any undecided matter,the dissenting Executive Committee member may request that
the Chief Executive Ofﬁcer submit such matter to the Chairman
for his opinion.
Under the Board Rules in effect in 2014, the Executive Committee
m embers were appointed by the Board of Directors on the
proposal of the Chief Executive Ofﬁ cer following consultation
with the Chairman and the Chairman of the Remuneration and
Nomination Committee. The proposals for appointment are madeapplying the following principles (i) the preference for the best
candidate for the position, and (ii) the maintenance, in respectof the number of members of the Executive Committee, of theobserved balance among the nationalities of the candidates inrespect of the location of the main industrial centers of Airbus
Group (in particular among the nationals of the four Member
States of the European Union where these main industrial centers
are located) and (iii) at least 2/3 of the members of the Executive
Committee, including the CEO and the CFO, will be EU nationaland residents.

Composition of the Executive Committee in 2014
Name

Age

Start of term

Principal Occupation

56

2012

Chief Executive Officer Airbus GroupFrançois Auque

58

2010

EVP Space Systems, Airbus Defence and Space

Thierry Baril

49

2012

Chief Human Resources Officer Airbus Group & & Airbus

Tom Enders

Jean J. Botti

57

2011

Chief Technical Officer Airbus Group

Fabrice Brégier

53

2012

Airbus Chief Executive Officer

Günter Butschek*

54

2012

Airbus Chief Operating Officer

Guillaume Faury

46

2013

Airbus Helicopters Chief Executive Officer

Bernhard Gerwert

61

2012

Airbus Defence and Space Chief Executive Officer

Marwan Lahoud

48

2012

Chief Strategy and Marketing Officer Airbus GroupJohn Leahy

64

2012

Airbus Chief Operating Officer – Customers

Allan McArtor

72

2014

Airbus Group, Inc. Chief Executive Officer

Domingo Ureña-Raso*

56

2009

EVP Military Aircraft, Airbus Defence and Space

Harald Wilhelm

48

2012

Chief Financial Officer Airbus Group & Airbus

4

Note: Status as of 31 December 2014. The professional address of all Members of the Executive Committee for any matter relating to Airbus Group is Mendelweg 30, 2333 CS Leiden,
The Netherlands.
* As announced in the corresponding Airbus Group press releases of 16 December 2014 and of 29 January 2015, Günter Butschek and Domingo Ureña-Raso resigned from theirpositions. Tom Williams and Klaus Richter have joined the Airbus Group Executive Committee as of 1 January 2015.

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Tom Enders – Airbus Group CEO
Thomas (“Tom”) Enders was appointed Chief Executive Ofﬁcer(CEO) of Airbus Group, effective 1 June 2012, after having been
CEO of Airbus since 2007. Before that he served as Co-CEO of
EADS between 2005 and 2007. He was Head of the Group’s
Defence division 2000-2005. He studied Economics, Political
Science and History at the University of Bonn and at the Universityof California in Los Angeles. Prior to joining the aerospaceindustry in 1991, Mr Enders worked, inter alia, as a Member of
the “Planungsstab” of the German Minister of Defence. He has
been member of the Executive Committee of Airbus Group since
its creation in 1999. Mr Enders was President of the BDLI (German
Aerospace Industry Association) from 2005 to 2012. He is memberof the BDI Presidential Board (German Industry Association) since2009. From 2005 to 2009 he was Chairman of the Atlantik-Brücke
e.V. In 2014, Mr Enders joined the Advisory Council of the Munich
Security Conference as well as the Senate of the Max-PlanckGesellschaft. Since 2011, Tom Enders is member of the Business
Advisory Group of UK Prime Minister David Cameron. He sits on
the Joint Advisory Council of Allianz SE since 2013.

François Auque – EVP Space Systems,
Airbus Defence and Space
François Auque was appointed Chief Executive Ofﬁcer of Astrium,
now merged with Cassidian and Airbus Military into Airbus Defence
and Space, in 2000. Previously, he was Chief Financial Ofﬁcer
together with Managing Director for satellites of Aerospatiale Matra
after having been Chief Financial Ofﬁcer of Aerospatiale since1991. He spent his earlier career with the Suez Group and theFrench Cour des comptes. Mr Auque graduated from École desHautes Études Commerciales, Institut d’Études Politiques and isan alumnus of École Nationale d’Administration.

Thierry Baril, Airbus Group and Airbus CHRO
Thierry Baril was appointed Chief Human Resources Ofﬁcer of
EADS and Airbus in June 2012. Formerly Executive Vice President
Human Resources at Eurocopter, he joined Airbus in 2007 as
Executive Vice President Human Resources and Member ofthe Airbus Executive Committee. Prior in his career, he gained
experience in Human Resources matters having served in various
HR positions within Alcatel, General Electric and Alstom. Mr Barilholds a university degree in HR Management, having graduatedin 1988 from the Institut de Gestion Sociale.

Jean Botti – Airbus Group CTO
Jean Botti was appointed Chief Technical Ofﬁcer of EADS in 2006.
He joined from General Motors, where he was Chief Technologist
and then Business Line Executive of the Delphi Powertrain
business. He started his career in 1978 as product engineer for
Renault Mr Botti holds a degree from INSA Toulouse, an MBA fromCentral Michigan University and a PhD from the Conservatoire
des Arts et Métiers and completed the course of Research andDevelopment Management at the Massachusetts Institute ofTechnology (MIT). Mr Botti is an SAE fellow as well as a Memberof the French Academy of Technology, a member of the German
Academy of Technologies (ACATECH) and of the European Key

124

enabling technology Board. He holds 3 PhD honorary degrees
from University of Cardiff, University of Bath and University ofSouth Alabama. He is member of the French Académie de l’Air etde l’Espace and Chevalier de la Légion d’honneur.

Fabrice Brégier, Airbus CEO
Fabrice Brégier was appointed President and Chief Executive
Ofﬁcer of Airbus in May 2012 after being its COO for six years aswell as Head of Operational performance across the EADS Group.
Previously, he was appointed President and CEO of Eurocopter
in 2003, CEO of MBDA in 2001 and CEO of BAe Matra Dynamics
in 1998. Mr Brégier joined Matra Défense in 1993. He is alumnus
of École Polytechnique and École des Mines.

Günter Butschek – Airbus COO
After joining Airbus in 2011 as Head of Operations, Mr Butschek
was appointed Chief Operating Ofﬁcer of Airbus and Member ofthe EADS Executive Committee in 2012. Mr Butschek spent mostof his career within Daimler AG having served several positions
in logistics, Human Resources, procurement and manufacturingin the Mercedes-Benz passenger Cars division. From 2002, healso led the Dutch entity Netherlands Car B.V., a subsidiary of
Mitsubishi and cooperation with DaimlerChrysler, and furthermore
ran Beijing Benz Automotive in China from 2005. Mr Butschek
graduated in Economics.

Guillaume Faury, Airbus Helicopters CEO
Guillaume Faury was appointed CEO of Eurocopter, now Airbus
Helicopters, in May 2013. Before assuming this role, he served as
Executive Vice President for Research and Development at Peugeot
S.A. since 2009. Prior to joining Peugeot, Mr Faury spent 10 years
at Eurocopter during which he held several senior management
positions. Long committed to the aerospace industry, Mr Faury is
an aerospace engineer and a licensed ﬂight test engineer.

Bernhard Gerwert – Airbus Defence and Space CEO
Bernhard Gerwert was appointed Chief Executive Officer ofCassidian, now merged with Astrium and Airbus Military into Airbus
Defence and Space, in 2012. Previously, he served the Division as
Member of the Management Board, being successively appointed
CEO of Cassidian Air Systems from 2007 to 2011 and then Chief
Operation Ofﬁcer from 2011. Starting his career in 1979, Mr Gerwert
held various leadership positions in Engineering, Product Support,
Finance and project management at MBB, DASA, Dornier,DaimlerChrysler Aerospace and EADS. Mr Gerwert graduatedin Electrical Engineering from the University of Paderborn and in
Industrial Engineering from the University of Bielefeld.

Marwan Lahoud, Airbus Group CSMOMr Lahoud was appointed Chief Strategy and Marketing Ofﬁcer
of EADS in June 2007. Previously, he was CEO of MBDA. He
worked for Aerospatiale during the merger with Matra and as wellat the foundation of EADS. Within EADS, he served as Senior Vice
President Merger & Acquisition. Mr Lahoud is an alumnus of École
Polytechnique and graduated from the École Nationale Supérieurede l’Aéronautique et de l’Espace.

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John Leahy, Airbus COO-Customers
John Leahy was appointed Chief Operation Ofﬁcer – Customersof Airbus and Member of the Airbus Executive Committee in 2005,
in addition to his responsibilities as Chief Commercial Ofﬁcer of
Airbus (since 1994). In 2012 he has been appointed Member ofthe EADS Executive Committee. Mr Leahy joined Airbus North
America in 1985 after working seven years at Piper Aircraft. He
became Head of Sales in 1988 and ﬁnally President of Airbus
North America. One of Mr Leahy’s greatest achievements was toraise Airbus’ global market share from 18% in 1995 to over 50%
today. Mr Leahy holds an MBA from Syracuse University and a
BA from Fordham University.

Allan McArtor, Chairman and CEO of Airbus Group, Inc.
Since June 2001, Allan McArtor has been overseeing the activities
and strategy of Airbus in the United States, Canada and Latin
America, and was instrumental in establishing Airbus’ industrial
presence in the US with the A320 family Assembly Line in Mobile,
Alabama. Before joining Airbus, he held a series of leadership andsenior management positions in the military, civil and government
sectors. He was the FAA Administrator under President Ronald
Reagan. He was responsible for Federal Express’ worldwide
air operations. And he founded Legend Airlines. Allan McArtor
was a combat ﬁghter pilot in Vietnam, an Associate Professor ofEngineering Mechanics at the Air Force Academy, and was a pilot
with the US Air Force “Thunderbirds”. He is a 1964 graduate of the

4.1.3

US Air Force Academy (BSE) and holds a Masters Degree (MSE)from Arizona State University.

Domingo Ureña Raso, Head of Military Aircraft,
Airbus Defence and SpaceAs Head of Military Aircraft, Domingo Ureña-Raso was responsible
for all military and unmanned aerial vehicle programmes of Airbus
Defence and Space and was member of the Group Executive
Committee of Airbus Group being responsible to represent theinterest in Spain. After several missions in different countries
and having been in charge of the Power8 and “Future EADS”
programmes, he was appointed Head of Airbus Military in 2009.
Mr Ureña-Raso holds degrees from the Polytechnic University of
Madrid, from ESSEC in Paris and has an MBA.

Harald Wilhelm, Airbus Group and Airbus CFO
Mr Wilhelm was appointed Chief Financial Officer of EADS
and a Member of the EADS Executive Committee in 2012.
Simultaneously, he pursues his mission as Chief Financial Ofﬁcerof Airbus and Member of the Airbus Executive Committee (since2008). Mr Wilhelm joined Airbus in 2000, serving in various ﬁnancial
positions and being ﬁnally appointed Chief Controlling Ofﬁcer of
Airbus in 2007. Earlier in his career, he developed strong M&A
experience at DASA. Mr Wilhelm holds a degree in BusinessStudies from the University of Munich.

Dutch Corporate Governance Code, “Comply or Explain”

In accordance with Dutch law and with the provisions of the Dutch
Corporate Governance Code as amended at the end of 2008
(the “Dutch Code”), which includes a number of non-mandatory
recommendations, the Company either applies the provisionsof the Dutch Code or, if applicable, explains and gives soundreasons for their non-application. While the Company, in its
continuous efforts to adhere to the highest standards, applies
most of the current recommendations of the Dutch Code, it must,in accordance with the “apply or explain” principle, provide theexplanations below. For the full text of the Dutch Code, pleaserefer to www.commissiecorporategovernance.nl.

2. Duration of mandate
Provision III.3.5 of the Dutch Code recommends that there be
no more than three four-year terms for non-Executive Membersof the Board of Directors.
■
In principal, the Company does not limit the number of consecutive
terms in ofﬁce of a Director. However, since the Company aims
at replacing about one third of the Board Members every three
years, and since the term of appointment is no longer than three
years, the Company should comply with the Dutch Code.
■4

3. Vice-chairmanship
Provision III.4.1(f) of the Dutch Code recommends the election ofa vice-Chairman, to deal with the situation when vacancies occur.
■
The Board of Directors is headed by the Chairman of the Board of
Directors. In case of dismissal or resignation of the Chairman, theBoard of Directors shall immediately designate a new Chairman.
There is therefore no need for a vice-Chairman to deal with thesituation when vacancies occur.
■

For the ﬁnancial year 2014, the Company states the following:
1. Retirement of Members of the Board of Directors.
Provision III.3.6 of the Dutch Code recommends that there bea retirement schedule to avoid, as far as possible, a situation inwhich many non-Executive Members of the Board of Directors
retire at the same time.
■
The Company combines the advantages of a staggered
Board with the legitimate interest of shareholders to review theperformance of each and every Director periodically. Thus, theCompany aims at replacing one third of the Board every three
years, while renewing the mandate of the other eight Membersof the Board of Directors.
■

4. Termination indemnity■

Provision II.2.8 of the Dutch Code recommends that the
maximum remuneration in the event of dismissal be one year’ssalary, and that if the maximum of one year’s salary would be
manifestly unreasonable for an Executive Board Member who isdismissed during his ﬁrst term of ofﬁce, such Board Member be
eligible for severance pay not exceeding twice the annual salary.

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The Company foresees a termination indemnity for the Chief
Executive Ofﬁ cer equal to one and a half times the annual
total target salary in the event that the Board of Directors has
concluded that the Chief Executive Ofﬁcer can no longer fulﬁlhis position as a result of change of the Company’s strategy or
policies or as a result of a change in control of the Company.
The termination indemnity would be paid only provided that theperformance conditions assessed by the Board of Directors
would have been fulﬁlled by the Chief Executive Ofﬁcer.

5. Securities in Airbus Group as long-term investment
Provision III.7.2 of the Dutch Code recommends that NonExecutive Directors who hold securities in the Company should
keep them as a long-term investment. It does not encourage
Non-Executive Directors to own shares.
■
The Company does not require its Non-Executive Directors
who hold shares in its share capital, to keep such shares asa long-term investment. Although Non-Executive Directors arewelcome to own shares of the Company, the Company considers
it is altogether unclear whether share ownership by NonExecutive Directors constitutes a factor of virtuous alignment
with stakeholder interest or maybe a source of bias against
objective decisions.
■

6. Dealings with analysts■

Provision IV.3.1 of the Dutch Code recommends meetings withanalysts, presentations to analysts, presentations to investors

4.1.4

7. Gender diversity
Pursuant to the Bill on Management and Supervision that wasenacted on 1 January 2013, a Board of Directors is composed in abalanced way if it contains at least 30% women and at least 30%
men. The contemplated balance of the composition of the Boardof Directors shall as much as possible be taken into accountat, among others, new appointments and recommendations.
■
The Company does not comply with these composition guidelines
yet. With the election of the ﬁrst woman to the Company’s Boardof Directors at the Extraordinary General Meeting in March 2013,
the Board today contains 8% women. The Company is pleased
with this development but not satisﬁed with its extent and willcontinue to promote gender diversity within its Board of Directors
by striving to increase the proportion of female Directors.
■

Enterprise Risk Management System

The aerospace and defence industry’s complex programmesdelivered over volatile market cycles, amplify risk and opportunity.
Airbus Group’s long-term development and production lifecycle
make Enterprise Risk Management (“ERM”) a crucial mechanism
for both mitigating the risks faced by the company and identifying
future opportunities.
ERM is a key management process serving to mitigate key risks andincrease opportunity. Applied across the Group, its subsidiaries
and major suppliers, ERM is striving for achieving and applying
common understanding, methodology, practice and language. By
mapping all material risks, planning how to mitigate them and how
to seize opportunities, ERM is designed to protect the achievementof the following:
Strategy: the selection of high level strategic objectives consistent
with risk appetite;■
Operations: effectiveness and efficiency of management,
operations and resource allocation, in line with performanceand ﬁnancial targets;■
Reporting: reliability of reporting, in particular ﬁnancial reporting;and■Compliance: compliance with applicable laws and regulations.
■

ERM is a permanent top-down and bottom-up process, which isconsistently executed across Airbus Group Divisions on each levelof the organisation. It is designed to identify and manage risks and126

and institutional investors and press conferences shall beannounced in advance on the Company’s website and by meansof press releases. In addition, it recommends that provisions
shall be made for all shareholders to follow these meetingsand presentations in real time and that after the meetings thepresentations shall be posted on the Company’s website.
■
The Company does not always allow shareholders to follow
meetings with analysts in real time. However, the Company
ensures that all shareholders and other parties in the ﬁnancial
markets are provided with equal and simultaneous information
about matters that may inﬂuence the share price.

opportunities focusing on business-relevant aspects. A particularfocus is put on the operational dimension due to the importanceof Programmes and Operations for Airbus Group.
Required key activities in Risk and Opportunity Management are:anticipation of future events and conditions;transparent communication;■
early warning;■
early risks reduction;■
seizing and capturing of opportunities.
■■

Enterprise Risk Management is an operational process embedded
into day-to-day management activities of Programmes, Operations
and Functions. A reporting synthesis is made and consolidated
on a regular basis (quarterly and yearly). The aim of the ERM
process is to:
identify, assess, control and mitigate risks, and seize and capture
opportunities;■
monitor the ERM process and to report status and results;■
allow risk-adjusted decisions and management processes (e.g.
planning; decision-making);■enhance risk-response/opportunity-capture decisions andactions;■align risk tolerance with strategy setting, and decision making
with operational and Programme activities;■

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identify and manage cross-enterprise risks/opportunities by
understanding interrelated impacts.

Through ERM, the Airbus Group Management ensures the:implementation of a suitable internal risk management andinternal control system;■
management of the risk proﬁle associated to the company’s
strategy;■
management of the risks associated with the company activities;■
ERM reporting to the Board of Directors and Audit Committee(AC) respectively;■
discussion of the internal risk management and control systems
with the Board of Directors and the Audit Committee.
■

The Airbus Group Board of Directors supervises the:■corporate strategy and the risks inherent to the businessactivities;■

design and effectiveness of the internal risk management andinternal control systems.

4.1.4.1

ERM Process

The ERM process applies to all possible sources of risks andopportunities, with both internal and external sources, quantiﬁable
and unquantiﬁable, potentially affecting the Company in the short-,
middle- and long-term. It also applies to all of the Company’sbusinesses, activities and departments. Management at eachlevel discusses ERM when they run the business, as part of theirdecision-making and related activities. Accordingly, the ERM
process is part of the management process and interrelated withother processes. The details of application of the ERM process varywith the risk appetite of management and the size, structure andnature of the organisational unit, programme/project, department
or process. Nonetheless, the fundamental principles of theCompany’s ERM Policy generally apply.
For a discussion of the main risks to which the Group is exposed,
see “— Risk Factors”.

4.1.4.2

ERM Governance and Responsibility

The governance structure and related responsibilities for the ERM
system are as follows:
the Board of Directors supervises the design and effectivenessof the ERM system including management actions to mitigate therisks inherent in the Company’s business activities. It discusses
the major risks at least quarterly based on ERM reporting or
as required depending on development of business risks. It is
supported by the Audit Committee, which discusses at least
yearly the activities with respect to the operation, design andeffectiveness of the ERM system, as well as any signiﬁ cantchanges and planned improvements prior to presentation to
the full Board of Directors;■
the Group’s Chief Executive Officer, backed by the Group
Executive Committee, is responsible for an effective ERM system,
the related internal environment (i.e. values, culture) and risk
philosophy. He is supported by the Group’s Chief Financial Ofﬁcer
who supervises the Head of Risk and Opportunity Management
Airbus & Airbus Group, and the ERM system design and process
implementation;■
the Head of Risk and Opportunity Management Airbus & Airbus
Group has primary responsibility for the ERM strategy, priorities,
system design, culture development and reporting tool. He
supervises the operation of the ERM system and is backed by a
dedicated risk management organisation on Group and Divisionlevel, which actively seeks to reduce overall risk criticality. The
risk management organisation is structured as a cross-divisional
Centre of Competence (“COC”) networked with the risk owners
on the different organisational levels and pushes for a proactive
risk management culture; and■the executive management assume responsibility for theoperation and monitoring of the ERM system in their respective
area of responsibility. They seek to ensure transparency andeffectiveness of the ERM system and adherence to its objectives.
They take responsibility for the implementation of appropriate
response activities to reduce probability and impact of risk
exposures, and conversely for the implementation of appropriate
responses to increase probability and impact of opportunities.
■

The objectives, principles and process for the ERM system as
endorsed by the Board of Directors are set forth in the Company’s
ERM Policy and communicated throughout the Group. The
Company’s ERM Policy is supplemented by various manuals,
guidelines, handbooks, etc. The ERM system is based on theInternal Control and Enterprise Risk Management Frameworkof the Committee of Sponsoring Organisations of the Treadway
Commission (COSO II). External standards that contribute to theCompany’s ERM system include the Internal Control and ERM
frameworks of COSO, as well as industry-speciﬁc standards as
deﬁned by the International Standards Organisation (ISO).
The ERM system comprises an integrated hierarchical bottom-up
and top-down process to enable better management andtransparency of risks and opportunities. At the top, the Boardof Directors and the Audit Committee discuss major risks andopportunities, related risk responses and opportunity capture
as well as the status of the ERM system, including signiﬁcantchanges and planned improvements. This is based on systematicbottom-up information including management judgement. The
results are then fed back into the organisation. The design of the
ERM system seeks to ensure compliance with applicable laws andregulations with respect to internal control and risk management,
addressing both subjects in parallel.
The ERM process consists of four elements: the operational
process, which consists of a sequence of eight consistent,
standardised components to enhance operational risk andopportunity management; the reporting process, which contains
procedures for the status reporting of the ERM system andthe risk / opportunity situation; the compliance process, which
comprises procedures to assess the effectiveness of the ERM
system; and the support process, which includes procedures
to increase the quality and provide further substantiation of thequality of the ERM system.

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4.1.4.3

ERM Effectiveness

The Company’s ERM system needs to be effective. To support
the assessment of the ERM effectiveness, the Company has
established recurring ERM self-assessment mechanisms, to be
applied across the Group. This seeks to allow the Company toreasonably assure the effectiveness of its ERM system. The ERM
effectiveness is analysed by:■■

Corporate Audit, based on internal corporate audit reports;
ERM CoC, based on ERM reports, conﬁrmation letters, in situ
sessions (risk reviews etc.), participation to key controls (e.g.
major Programme Maturity Gate Reviews).For the coverageof all of its activities, the Company has deﬁned 20 high levelbusiness processes. In order to achieve ERM effectiveness,

the ERM process as an overlaying process must be an integral
part of these business processes. ERM effectiveness is assured
if the achievement of the ERM process objectives is secured
by adequate ERM controls which are operating effectively
throughout the organisation and are within the respective risk
appetite level.
Operating effectiveness is measured inter alia by assessing any
potential major failings in the ERM system which have been
discovered in the business year or any signiﬁcant changes madeto the ERM system.

The combination of the following controls is designed to achieve reasonable assurance about ERM effectiveness:
Organisation

ERM control with explanations

Board of Directors / Audit
Committee

Regular monitoring
The Board of Directors and the Audit Committee review, monitor and supervise the ERM system.

Top Management

ERM as part of the regular divisional business reviews
This control is an important step of the ERM compliance process. All results of the operational risk management
process, self-assessment and confirmation procedures are presented by the Divisions or Business Units to top
management and discussed and challenged at the Company’s CEO / CFO level.

Management

ERM confirmation letter procedure
Entities and processes / department heads that participate in the annual ERM compliance procedures need to sign
ERM confirmation letters, especially on internal control effectiveness and deficiencies or weaknesses. The scope ofparticipants is determined by aligning coverage of Airbus Group business with management’s risk appetite.

ERM department

ERM effectiveness measurement
Assess ERM effectiveness by performing operational risk management for the ERM process, benchmarks, etc.

Corporate Audit

Audits on ERM
Provide independent assurance to the Audit Committee on the effectiveness of the ERM system.

Ethics and Compliance

Alert System
Provide evidence for deficiencies of the ERM system.

4.1.4.4

Developments in 2014 and Outlook

The ERM function has an important role to play to make thebusiness robust, support operational decision making, improve
performance, protect margins and reduce exposure level.
A cross-Divisional ERM CoC is set up to further develop operationalrisk reduction and synergies. This is a matrix CoC in which 3 ERM
teams join their efforts. The ERM CoC supports and challenges
programmes and organisations, pushes for early risks reduction
and opportunities capturing, as well as an enhanced R&O /anticipation culture in the Group, including cross Divisional Risk
Reviews.

4.1.4.5

Board Declaration

The Board of Directors believes to the best of its knowledge thatthe internal risk management and control system over ﬁnancial
reporting has worked properly in 2014 and provides reasonableassurance that the ﬁnancial reporting does not contain any errorsof material importance.
No matter how well designed, all ERM systems have inherent
limitations, such as vulnerability to circumvention or management
overrides of the controls in place. Consequently, no assurance canbe given that the Company’s ERM system and procedures are or
will be, despite all care and effort, entirely effective.

In 2014 the ERM CoC acted to achieve and improve the:sustainability of the compliance dimension;
proximity to the business and giving priority to the operational
dimension, simplification of ERM processes and reports,
adopting a lean approach, and focusing activities;■
team spirit throughout the CoC with constant mutual awarenessof areas at stake needing support and expertise from otherparts of the CoC;■
development of a strong network in the Group, linking the various
communities for best practices sharing;■cross-challenges and cross-fertilisations between the Divisions.
■
■

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4.1.4.6

Business Processes Covered by the ERM
SystemBased on the Company’s activities, 20 high-level businessprocesses have been identiﬁed within the Company. They are
categorised into core processes (research and development,
production, sales, after-sales and programme management),
support processes (corporate sourcing, Human Resources,
accounting, fixed assets, treasury, information technology,
mergers and acquisitions, legal and insurance) and management
processes (strategy, corporate audit, controlling, compliance,

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risk management and management controls). These businessprocesses, together with the corresponding ERM processes, aredesigned to control process risks that have signiﬁcant potential
to affect the Group’s ﬁnancial condition and results of operations.
Below is a description of the main business processes at therespective headquarters’ level which were in place during 2014.

Accounting
At the core of the Company’s ERM system are accounting
processes and controls designed to provide reasonable assurance
regarding the reliability of ﬁnancial reporting and the preparationof ﬁnancial statements and other ﬁnancial information used bymanagement and disclosed to the Company’s investors and otherstakeholders. The integrated approach to planning and reporting
aims to improve internal communication and transparency acrossdepartments and organisational units within the Company.
The Company’s ﬁnancial control model deﬁnes the planning andreporting procedures that apply to all operational units of theGroup, as well as the responsibilities of the Chief Financial Ofﬁcer,
who is charged with developing, implementing and monitoringthese procedures. Among the Chief Financial Ofﬁcer’s primarytasks is oversight of the preparation of the Consolidated Financial
Statements of Airbus Group N.V., which are prepared under the
direct supervision of the Chief Accounting Ofﬁcer (“CAO”). The
CAO is responsible for the operation of the Group’s consolidation
systems and rules and for the deﬁnition of group-wide accounting
policies which comply with IFRS, reporting rules and ﬁnancial
guidelines in order to ensure the consistency and quality of ﬁnancial
information reported by the Divisions and Business Units. The
Company’s accounting policies are set out in a written accounting
manual, which is agreed with the Company’s external auditors.
Changes to the Company’s accounting manual require approvalby the CAO, and, where signiﬁcant changes are involved, the Chief
Financial Ofﬁcer or the Board of Directors (based upon the adviceof the Audit Committee).
Control of the financial planning and reporting processes isachieved not only through the development of group-wideaccounting systems and policies, but also through an organised
process for providing information from the reporting units on atimely basis as an up-to-date decision-making tool to control theoperational performance of the Group. This information includes
regular cash and treasury reports, as well as other ﬁ nancial
information used for future strategic and operative planning andcontrol and supervision of economic risks arising from the Group’s
operations. The Divisional Chief Financial Ofﬁcers frequently meetwith the CAO and his responsible staff to discuss the ﬁnancial
information generated by the Divisions.
Prior to being disclosed to the public and subsequently submitted
for approval to the shareholders, the consolidated year-end
financial statements are audited by the Company’s external
auditors, reviewed by the Audit Committee and submitted forapproval by the Board of Directors. A similar procedure is used forthe semi-annual and quarterly closing. Group auditors are involved
before the Company’s ﬁnancial statements are submitted to theBoard of Directors.

Treasury
Treasury management procedures, deﬁned by the Company’s
Central Treasury department at Group headquarters, enhance
management’s ability to identify and assess risks relating toliquidity, foreign exchange rates and interest rates. Controlledsubsidiaries fall within the scope of the centralised treasury
management procedures, with similar monitoring procedures
existing for jointly controlled afﬁliates, such as MBDA.
Cash management. The management of liquidity to support
operations is one of the primary missions of the Company’s Central
Treasury department. Regular cash planning, in conjunction with
the Planning / Reporting department, as well as monthly cash
reporting by the Central Treasury department, provide managementwith the information required to oversee the Group’s cash proﬁleand to initiate necessary corrective action in order to ensure overallliquidity. To maintain targeted liquidity levels and to safeguard cash,
the Company has implemented a cash pooling system with daily
cash sweeps from the controlled subsidiaries to centrally managed
accounts. Payment fraud prevention procedures have been deﬁned
and communicated throughout the Group. For management ofcredit risks related to ﬁnancial instruments, see “— Notes to theConsolidated Financial Statements (IFRS) — Note 34a: Financial
risk management”.
Hedge management. Commercial operations generate material
foreign exchange and interest rate exposures. A Group hedging
policy is deﬁned and updated regularly by the Board of Directors. In
order to ensure that all hedging activity is undertaken in line with theGroup hedging policy, the Company’s Central Treasury department
executes all hedging transactions. The Central Treasury department
conducts on-going risk analysis and proposes appropriate
measures to the Divisions and Business Units with respect toforeign exchange and interest rate risk. Subsidiaries are required to
calculate, update and monitor their foreign exchange and interest
rate exposure with the Company’s Central Treasury department on
a monthly basis, in accordance with deﬁned treasury procedures.
See “— Management’s Discussion and Analysis of Financial
Condition and Results of Operations — 2.1.7 Hedging Activities”.

4

Sales ﬁnancing. In connection with certain commercial contracts,
the Company may agree to enter into sales ﬁnancing arrangements.
In respect of sales ﬁnancing at Airbus, an annual sales ﬁnancing
budget is deﬁned as part of the Company’s operative planning
process. Sales ﬁnancing transactions are approved on a case-bycase basis with the involvement of top management, in line withcertain risk assessment guidelines and managed by a group-wide
integrated organisation.

Sales
Commercial contracts entered into by the Company’s operating
subsidiaries have the potential to expose the Group to signiﬁcant
financial, operational and legal risks. To control these risks,management has implemented contract proposal review
procedures that seek to ensure that the Company does not enter
into material commercial contracts that expose it to unacceptablerisk or are not in line with the Group’s overall objectives. These
procedures include (i) Board of Directors-approved thresholds

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and criteria for determining the risk and profitability profilesand (ii) a mandated pre-approval process for contracts deﬁned
as “high-risk”. Contracts falling within the defined thresholdcategories require approval by the respective Divisional Chief
Financial Ofﬁ cer. Contracts that are deemed “high-risk” andexceed certain thresholds must be submitted to a standing
Commercial Committee (with the Chief Financial Ofﬁcer and theChief Strategy and Marketing Ofﬁcer serving as Chairmen, and apossible escalation to the Chief Executive Ofﬁcer when needed).
This committee is responsible for reviewing the proposal andgiving recommendations when necessary, based on which theconcerned Business Unit is allowed to remit its offer. In the caseof Airbus, due to the nature and size of its business, contracts areapproved in accordance with Airbus’ own corporate governancepolicy based on the Company’s guidelines which follow the same
principle, with participation of the Company. In general, where
the Company shares control of a subsidiary with a third party,
the Commercial Committee is responsible for developing theCompany’s position on proposed commercial contracts.

Legal
The Company is subject to myriad legal requirements in eachjurisdiction in which it conducts business. The mission of theCompany’s Legal department, in coordination with the Division
and Business Unit Legal departments, is to actively promoteand defend the interests of the Group on all legal issues and toensure its legal security at all times. By carrying out this mission
it is responsible for implementing and overseeing the procedures
designed to ensure that the Company’s activities comply with allapplicable laws, regulations and requirements. It is also responsible
for overseeing all major litigation affecting the Group, includingIntellectual property.
The Company’s Legal department, together with the Corporate
Secretary, also plays an essential role in the design and administrationof (i) the Company’s corporate governance procedures and (ii) the
legal documentation underlying the delegation of powers andresponsibilities which deﬁne the Company’s management and its
internal control environment.

Corporate Audit & Forensic
The Company’s Corporate Audit & Forensic department,
reporting to the CEO, provides independent assurance to the
Executive Committee and Audit Committee Members based
upon a risk-oriented approved annual audit plan. The Corporate

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Audit & Forensic department (i) reviews the achievement of theGroup’s strategic, ﬁnancial or operational objectives, (ii) reviews
the reliability and integrity of Group reporting, (iii) reviews theeffectiveness of the ERM system, (iv) reviews the efﬁciency andeffectiveness of selected processes, entities or functions and(v) reviews compliance with laws, regulations, Group guidelines
and procedures. Corporate Audit & Forensic also conducts
ad hoc reviews, performed at the request of Group Executive
Committee Members. In 2011, the Institut français de l’audit et ducontrôle internes (IFACI) reviewed the Corporate Audit & Forensic
department and certiﬁed that it fulﬁlled the requirements of theInternational Professional Practices Framework. Corporate Audit& Forensic also includes a team of forensic experts in charge ofconducting investigations of compliance allegations.

Corporate Sourcing
The performance of the Company is to a large extent determinedthrough its supply chain. Therefore, sourcing is a key lever for theCompany in its marketplace.
The Company’s size and complexity requires a common approachto maximise market levers and to avoid inefficiencies in the
procurement process. To help ensure that sourcing is carriedout in the most effective, efﬁcient and ethical manner, a set ofcommon procurement processes, which support a common
sourcing strategy and ultimately the Group strategy and vision,is deﬁned by the head of Corporate Sourcing and the Group’s
Procurement Leadership Team.
The common approach and processes are then implemented andoptimised across all Divisions through the Sourcing Commodity
Boards and Networks. These Sourcing Commodity Boards andNetworks comprise representatives from all Divisions. They aretasked by the Group’s Procurement Leadership Team to deﬁne
and roll out across the Company’s strategic sourcing topics suchas Supplier Relationship Management, Common Processes andTools, Global Sourcing, Joint Procurement, Compliance, Corporate
Social Responsibility, Procurement Academy and Procurement
Performance Management. The procurement processes are
regularly reviewed by means of performance indicators, audits andself-assessments and thus consistently challenged and optimised.

Ethics and Compliance
See “— 4.1.5 Ethics and Compliance Organisation” below.

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4.1.5

Ethics and Compliance Organisation“Within the Airbus Group, it’s not just our results that matter– it’s the way we achieve them” as our CEO has stated it. The
Group Ethics and Compliance Programme (the “Group E&C
Programme”) seeks to ensure that Group business practices
conform to applicable laws and regulations as well as to ethicalbusiness principles and to establish a culture of integrity. We
believe that such a culture helps us sustain the Group’s global
competitiveness.
There are two foundation documents in the Group E&C Programme:the “Standards of Business Conduct” which were revised in 2013
and “Our Integrity Principles” which summarises the Group’s 6
key Ethics and Compliance commitments and which was rolled
out group-wide to each individual employee in 2013 by his / hermanager.
The Group E&C Organisation balances proximity to day-to-day
business activities with the necessary independence. Hence,
the Group SVP Ethics and Compliance Ofﬁcer (“ECO”), who isappointed by the Board of Directors, reports both to the Group
Chief Executive Officer and the Audit Committee while theDivisions’ Ethics and Compliance Ofﬁcers report both to Division
CEO and the Group ECO. Each Division E&C Ofﬁ cer runs a
Divisional E&C Organisation that is embedded within the businessthrough a network of E&C representatives. In recent years, wehave enlarged our footprint of E&C representatives and they are

now present in all functions and locations of the Business. They
are the voice and the face of our E&C Programme to help us build
an E&C culture. In 2014 we continued to extend the breadth of theGroup E&C Programme by appointing an E&C Manager in China.
This appointment complements a network of four E&C Managers
previously appointed in Brazil, India, Russia and the Kingdom of
Saudi Arabia. The Country E&C Managers report to the ECO.
At Group level, dedicated Compliance Risks Officers are
empowered to issue standards applicable throughout the Group,
test effectiveness and control adherence. The Group International
Compliance Ofﬁce addresses corruption and bribery risks. The
Group Export Compliance Ofﬁce ensures that the activities of
the Group comply with all relevant export control rules and with
the internal “sensitive countries” policy. The Group Procurement
Compliance Ofﬁcer supervises compliance in the supply chain
while the Group Data Protection Compliance Ofﬁcer is in chargeof data privacy risk.
These Compliance Risks Ofﬁcers manage a network of more than
100 risks specialists that are embedded in the Divisions within
the Business.
Like previous years, E&C was a top priority for the Group in 2014
and the E&C Organisation had a set of objectives. Similarly, eachof our Executives had E&C objectives to meet.

Our E&C Cycle includes the following steps which are put in motion by empowered E&C Resources:

Risks Assessed& Mitigation Plan
AdoptedEarly Detection& Full Remediationof Breaches

Empowered
Ethics &Compliance
Resources4
User-friendly
Policies,
Processes & Tools
adaptedEffective
communication& Training

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Employees, customers, suppliers, and third-party intermediaries
are encouraged to freely share their E&C concerns with theManagement or with E&C Resources. While we have a nonretaliation principle, we recognise that a conﬁ dential channel
for reporting may be useful and we have an alert system called
OpenLine. Subject to local legal restrictions, OpenLine is available
to employees of controlled entities in France, Germany, Spain, theUK, Australia, Brazil and Canada. It has been extended to China,
Mexico and Saudi Arabia in 2014. The Airbus Group OpenLine canbe used by employees to raise concerns in relation with Corruption
and Bribery, Accounting, Finance, Anti-Competitive practices,
Harassment, Conﬂicts of Interest, Quality or Product Safety.
The Group ECO reports to the Audit Committee on complianceallegations twice a year. The report contains details on Groupsignificant compliance allegations, including the allegations
described above under “— 1. Information on Group’s

Activities — 1.1.8 Legal and Arbitration Proceedings”. As a matterof transparency and to leverage on lessons learned, this report isshared with the top management.
In 2014, the Company was awarded an Anti-Corruption Compliance
System certiﬁcate delivered by an external veriﬁcation company
called ETHIC Intelligence.
Like in previous years, in 2014 the Group participated to various
collective actions on Ethics and Compliance and Anti-Corruption.
Notably, Airbus Group signed the Call to Action, A Call from
Business to Governments to Address Corruption and Foster Good
Governance, in the frame of the Global Compact 10th Principle. In
2014, Airbus Group also continued to chair the International Forumfor Business Ethical Conduct (IFBEC), a sectorial associationthat develops global Ethics and Compliance standards in the
Aerospace and Defence industry.

4.2 Interests of Directors and Principal
Executive Ofﬁcers
4.2.1

Remuneration Policy

The Company’s Remuneration Policy covers all Members of theBoard of Directors: the CEO (who is the only Executive Director)
and the other Members of the Board (which is comprised of NonExecutive Directors).
It should be noted that although the Policy relating to executive
remuneration only refers to the CEO, these principles are also
applied to the other members of the Group Executive Committee,
who do not serve on the Board of Directors, and to a large extent
to all executives across the Group. Upon proposal by the CEO, theRemuneration and Nomination Committee (“RNC”) analyses andrecommends, and the Board of Directors decides the remunerationof the members of the Group Executive Committee.
For the changes to the Remuneration Policy that will be proposed
for adoption by the 2015 General Meeting of Shareholders, see“— 4.2.1.3 — Proposed Amendments to the Remuneration Policy”.
To see how the Remuneration Policy was applied in 2014 in respectof the CEO (the only Executive Member of the Board of Directors)(1),
see “— 4.2.1.4 — Implementation of the Remuneration Policy in
2014: CEO”.

4.2.1.1

Executive Remuneration – Applicable to
the CEOa) Remuneration Philosophy
The Company’s Remuneration philosophy has the objectiveof providing remuneration that will attract, retain and motivate
high calibre executives, whose contribution will ensure that theCompany achieves its strategic and operational objectives,
thereby providing long-term sustainable returns for all
shareholders.
The Board of Directors and the RNC are committed to making
sure that the executive remuneration structure is transparent andcomprehensible for both executives and investors, and to ensurethat executive rewards are consistent and aligned with the interestsof long-term shareholders.
Before setting the targets to be proposed for adoption to theBoard of Directors, the RNC considers the ﬁ nancial outcome
scenarios of meeting performance targets, as well as of maximum
performance achievements, and how these may affect the leveland structure of the executive remuneration.

To see how the Remuneration Policy was applied in 2014 in respectof the non-Executive Members of the Board of Directors, see“— 4.2.1.5 — Implementation of the Remuneration Policy in 2014:
Non-Executive Fees”.
(1) The cumulated remuneration of all Executive Committee Members is presented in the ﬁnancial notes nr 36.

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The level of Total Direct Compensation for the CEO is set at themedian of an extensive peer group. The benchmark is regularly
reviewed by the RNC and is based on a peer group which
comprises:b) Total Direct Compensation and Peer GroupThe Total Direct Compensation for the CEO comprises a Base
Salary, an Annual Variable remuneration (“VR”) and a Long-Term
Incentive Plan (“LTIP”). The three elements of the Total Direct
Compensation are each intended to comprise 1/3 of the total,
assuming the achievement of performance conditions is 100%of target.

global companies in Airbus Group’s main markets (France,
Germany, UK and US); and■companies operating in the same industries as Airbus Group
worldwide.
■

The elements of the Total Direct Compensation are described below:
Remuneration Element

Main drivers

Base Salary

Reflects market value of position.

Annual Variable
Remuneration (VR)Rewards annual performancebased on achievement of company
performance measures andindividual objectives.

Rewards long term commitment
and company performance, andengagement on financial targets,over a five year period.

Long-Term Incentive Plan
(LTIP)

Performance Measures

Target and Maximum

Not applicable

1/3 of Total Direct Compensation(when performance achievement is100% of target)

Collective (50% of VR): divided
between EBIT* (45%); FCF (45%)
and RoCE (10%).
Individual (50% of VR): Achievementof annual individual objectives, divided
between Outcomes and Behaviour.
Vesting ranges from 0% to 150%
of initial grant, subject to cumulative
performance over a three-year period.
In principle, no vesting if cumulative
negative EBIT*. If EBIT* is positive,
vesting from 50% to 150%
of grant based on EPS (75%)
and Free Cash Flow (25%)

The VR is targeted at 100% of Base
Salary for the CEO and, dependingon the performance assessment,
ranges from 0% to 200% of target.
The VR is capped at 200%of Base Salary.
The original allocation to the CEO iscapped at 100% of Base Salary at
the time of grant.
Since 2012, the overall pay-out iscapped at a maximum 250% of theoriginal value at the date of grant.
The value that could result fromshare price increases is capped at200% of the reference share priceat the date of grant.

SCENARIOS CEO TOTAL DIRECT COMPENSATION
Indications are in million euro.
Below Threshold“Below Threshold” includes annual base Salary;
Annual Variable Remuneration at 0%; LTIP not vesting.

Target“Target” includes Base Salary, Annual Variable
Remuneration at target and LTIP grant face value.

Maximum“Maximum” includes Base Salary; maximum Annual
Variable Remuneration value (200%); LTIP grant
projected at vesting date (250%).
01Base Salary

2

3

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5

Variable Remuneration (VR)

6

7

8

4

9

Long-Term Incentive (LTIP)c) Base Salary
The Base Salary of the CEO is determined by the Board of Directors,
taking into account the peer group analysis mentioned above.

The performance measures that are considered when awarding
the VR to the CEO are split equally between Common Collective
performance measures and Individual performance measures.

Common Collective Componentd) Annual Variable Remuneration
The VR is a cash payment that is paid each year, depending on
the achievement of speciﬁc and challenging performance targets.
The level of VR for the CEO is targeted at 100% of Base Salary; itis capped at a maximum level of 200% of Base Salary. The entire
VR is at-risk, and therefore if performance targets are not achieved
sufﬁciently, no VR is paid.

The Common Collective component is based on EBIT* (45%), Free
Cash Flow (45%) and RoCE (10%) objectives. Each year, the Airbus
Group Board of Directors sets the goals for these key value drivers
at Group and Division levels. The Common Collective ﬁnancial
targets relate closely to internal planning and to guidance given
to the capital market (although there may be variations therefrom).

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To calculate the Common Collective annual achievement levels,
actual EBIT*, Free Cash Flow and RoCE performance arecompared against the targets that were set for the year. This
comparison forms the basis to compute achievement levels,
noting that the actual EBIT*, Free Cash Flow, and RoCE levels areoccasionally adjusted for a limited number of factors which areoutside management control (such as certain foreign exchange
impacts or unplanned Merger and Acquisition activities). The RNC’s
intention is to ensure ambitious ﬁnancial targets and to incentivise
the CEO’s commitment to meeting these targets.

FCF (Free Cash Flow)
Annual, M€ (45%)

EBIT (Earnings before Interest & Tax)
Annual, M€ (45%)
Measures proﬁtability
Driven by revenues and operating
expenses

Measures cash generation
Driven by cash provided / used for operating,ﬁnancing, and investment activities

Airbus Group
Executives
CommonCollective
Financial
Targets

RoCE
Annual, % (10%)
Measures how much proﬁt is generated by
the capital invested in the business
Driven by operational and capital efﬁciency

Individual
The Individual element focuses on Outcomes and Behaviour.
Individual Performance is assessed in these two importantdimensions:
Outcomes encompass various aspects of what the CEO can do
to contribute to the success of the business: speciﬁc businessresults he helps achieve, projects he drives and processes
he helps improve. The individual targets of the CEO arecomprehensive and shared with all employees via the Company
Top Priorities.
■
Behaviour refers to the way results have been achieved, whichis also critical for long term success: how the CEO and Boardof Directors work as a team, how the CEO leads the Group
Executive Committee, quality of communication, encouragementof innovation, etc. A speciﬁc part of the Behaviour assessment
relates to ethics, compliance and quality issues.
■e) Long-Term Incentive Plan
For the CEO, the Company’s current LTIP is comprised only of
Performance Units. One Unit is equal in value to one Airbus Group
share.

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The Board of Directors has the discretion, subject to shareholder
approval at the Annual General Meeting of Shareholders, to replace
all or part of future LTIP allocations with substantially similar
instruments, such as performance shares or other equity-related
allocations. As with the Performance Units, the value of the CEO’s
LTIP allocations would continue to be capped as a percentage
of Base Salary at the date of grant and be subject to comparable
performance conditions.

Performance Units
Performance Units are the long-term equity-related incentive
awards that are currently granted to the CEO. LTIP awards
are granted each year. Each grant is subject to a three-year
cumulative performance objective. At the end of the three-year
period, the grant is subjected to a performance calculation todetermine whether and to what extent it should vest. Depending
on continued employment, grants attributed until 2013 will vest in
four tranches, the payment of which takes place approximately
6, 12, 18 and 24 months following the end of the performance
period. Depending on continuous employment, grants attributed
from 2014 would vest in two tranches, the payment of which would
take place approximately 6 and 18 months following the end of
the performance period.

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LTIP-SCHEME

GRANT Date:
KPIs set for 3 years(average EPS / Cumulative FCF)

2014

PERFORMANCE calculation
determines the number ofunits that may vest

2015

2016

2017

Performance period 3 years

At the date of grant, the CEO must decide what portion of theallocation (subject to the performance calculation) will be released
as cash payments and what portion will be converted into shares.
At least 25% (and up to 75%) of the award must be deferred intoshares, and will only be released on the last vesting date.
For each payment in cash, one unit is equal to the value of one
Airbus Group share at the time of vesting. The Airbus Group’s sharevalue is the average of the opening share price, on the Paris Stock
Exchange, during the twenty trading days preceding and including
the respective vesting dates. For the conversion into shares, one
unit corresponds to one Airbus Group share.
For the CEO, the value of the Performance Unit allocation is capped,at the time of grant, at 100% of Base Salary. The number of Units
that vest can vary between 0% and 150% of the Units granted. The
level of vesting is subject to the following performance measures:
0-50% of the allocation: This element of the Performance
Unit award will vest unless the Airbus Group reports negative
cumulated EBIT* results. In this case the Board of Directors
has the discretion to review the vesting of this portion of the
Performance Unit award.
■
50-150% of the allocation: This element of the Performance
Unit award vests based on one performance criteria: average
earnings per share. Starting with the 2013 plan, the Company
proposes that this element be based on two performance
criteria: average earnings per share (75%) and cumulative Free
Cash Flow (25%).
■

The vesting of Performance Units is subject to the following
maximum caps:
The maximum level of vesting is 150% of the number of Units
granted.
■The value that could result from share price increases is capped
at 200% of the reference share price at the date of grant.
■
The overall pay-out is capped at 250% of the value at the dateof grant.
■

2018

2019

Until 2013:
Grants VEST in 4 tranches = 4 payment dates
From 2014:
Grants VEST in 2 tranches = 2 payment datesf) Share Ownership Guideline
The Board of Directors has established a share ownership guideline
pursuant to which the CEO is expected to acquire Airbus Group
shares with a value equal to 200% of Base Salary and to holdthem throughout his tenure.

g) Benefits
The beneﬁts offered to the CEO comprise a company car andaccident insurance. Travel cost reimbursements are based on thecompany travel policy as applicable to all employees.

h) Retirement
The CEO is entitled to a retirement beneﬁt. The Company’s policy
is to provide a pension at retirement age that equals 50% ofBase Salary, once the CEO has served on the Group Executive
Committee for ﬁve years. This pension can increase gradually to
60% of Base Salary, for executives who have served on the Group
Executive Committee for over ten years, and have been Airbus
Group employees for at least 12 years.

4i) Contracts and Severance
In the case of contract termination, the CEO is entitled to anindemnity equal to 1.5 times the Total Annual Target (deﬁned as
Base Salary and target Annual Variable Remuneration) with respect
to applicable local legal requirements if any. This will not apply if
the CEO mandate is terminated for cause, in case of dismissal, if
he resigns or, if the CEO has reached retirement age.
The CEO’s contract includes a non-compete clause whichapplies for a minimum of one year, and can be extended at theCompany’s initiative for a further year. The Board of Directors has
the discretion to invoke the extension of the non-compete clause.
The compensation for each year that the non-compete clauseapplies is equal to 50% of the last Total Annual Income (deﬁned
as Base Salary and Annual Variable Remuneration most recentlypaid) with respect to applicable local legal requirements if any.

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Past LTIP awards may be maintained, in such cases as in thecase of retirement or if a mandate is not renewed by the Company
without cause. The vesting of past LTIP awards follows the plans’
rules and regulations and is not accelerated in any case. LTIP
awards are forfeited for executives who leave the Company of theirown initiative, but this is subject to review by the Board of Directors.

Under the current policy, Members of the Board are entitled to
the following fees:
ﬁxed fee for membership of the Board EUR / year:
Chairman of the Board: 180,000,
Member of the Board: 80,000;■
ﬁxed fee for membership of a committee EUR / year:
Chairman of a committee: 30,000,
Member of a committee: 20,000;■
attendance fees EUR / Board meeting:
Chairman: 10,000,
Member: 5,000.
■

■

■

■

j) Clawback■

Recent changes to Dutch law introduced the possibility for theCompany to deduct or claw back part of the CEO’s variable cash
remuneration (i.e. VR) or equity-related remuneration (excluding
the LTIP element settled in cash) served by the Company if certain
circumstances arise.
Any revision, claw back, or amounts deducted from the CEO’s
remuneration will be reported in the ﬁnancial notes of the relevant
Annual Report.

■

Committee chairmanship and Committee Membership fees are
cumulative if the concerned Non-Executive Director belongs to
two different Committees. Fees are paid twice a year at the end ofeach semester (as close as possible to the Board meeting dates).

4.2.1.3k) Loans
Airbus Group does not provide loans or advances to the CEO.

4.2.1.2■

Non-Executive Remuneration – Applicable
to Non-Executive Members of the Boardof Directors

The Company’s Remuneration Policy with regard to non-Executive
Members of the Board of Directors is aimed at ensuring faircompensation and protecting the independence of the Board’s
members.

Fees and Entitlements
Non-Executive Members of the Board are entitled to the following:a base fee for membership or chair of the Board;
a committee fee for membership or chair on each of the Board’s
Committees;■an attendance fee for the attendance of Board meetings.
■

Proposed Amendmentsof the Remuneration Policy

At the 2015 Annual General Meeting, the Board of Directors is
proposing that shareholders adopt a number of amendments to
the Airbus Group Remuneration Policy.
The following changes are being proposed:
the ﬁrst proposed change affects eligibility to the LTIP plan, which
is not automatically granted and no-Grant policy for leavers is
instituted;■
the second proposed change is to reduce the number of LTIP
vesting dates to 2, spread across the fourth and the ﬁfth year of
the plan, whereas they currently stand at 4;■
the third proposed change is to bring down to 5 shares theminimal acquisition, allowing broader access and to cap thelevel of matching shares.
■■

Each of these fees is a ﬁxed amount. Non-Executive Membersof the Board do not receive any performance or equity-relatedcompensation, and do not accrue pension rights with the Company
in the frame of their mandate, except what they would receive inthe frame of a current or past executive mandate. These measures
are designed to ensure the independence of Board members andstrengthen the overall effectiveness of the Company’s corporate
governance.
The company does not encourage Non-Executive Directors topurchase Airbus Group shares.

4.2.1.4

Implementation of the Remuneration
Policy in 2014: CEOa) Benchmarking
The RNC regularly benchmarks the CEO’s Total Direct
Compensation (Base Salary, Annual Variable Remuneration andLTIP) against an extensive peer group.
The last review took place in October 2014, and was completedwith the assistance of an independent consultant: Towers Watson.
The relevant peer groups that were considered were proposedby Towers Watson, and comprised 31 companies (1) having
comparable economic indicators such as revenue, number of
employees and market capitalisation. Financial institutions were
excluded from the peer group.
Based on this review the RNC concluded again this year, that the
CEO’s Total Direct Compensation was slightly below the medianlevel of the peer group.

(1) France: Air Liquide, Danone, Michelin, Renault, Sanoﬁ, Schneider Electric, GDF Suez, Vinci.
Germany: BASF, Bayer, BMW, Daimler, Lufthansa, Deutsche Post World Net, Deutsche Telekom, E.ON, Henkel, RWE, SAP, Siemens, ThyssenKrupp.
UK: Anglo American, BP, GlaxoSmithKline, Glencore, Imperial Tobacco, Rio Tinto, Rolls-Royce, Royal Dutch Shell, Unilever.
US: AT&T, Boeing, Caterpillar, Cisco Systems, Coca-Cola, General Electric, IBM, Intel, Johnson & Johnson, Microsoft, Pﬁzer, Procter and Gamble, United Technologies, Verizon.

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4.2 Interests of Directors and Principal Executive Ofﬁ cersb) Base Salary
For 2014, the Base Salary was set by the Board of Directors at€ 1,400,004 (unchanged compared to the annualised salary paidin the previous year). The CEO’s Base Salary level was set in
July 2012, shortly after his appointment. The intention of the Boardof Directors is not to review this Base Salary level in 2015. Any
review of the CEO’s Base Salary will also take into consideration
salary increases of employees across the Group.

c) Annual Variable Remuneration
As stipulated in the Company’s Remuneration Policy, the CEO’s
Annual Variable Remuneration is targeted at 100% of Base Salaryand capped at 200% of Base Salary. It is subject to the fulﬁlmentof Collective and Individual performance targets.
For 2014, the Annual Variable Remuneration amounted to an
aggregate € 1,939,000, composed of € 959,000 for the Common
Collective Component and € 980,000 for the Individual part.
The Common Collective Component results from a composite
137% achievement of EBIT*, Free Cash Flow and RoCE objectives.
This achievement mainly reﬂects a signiﬁcant Free Cash Flow
over-performance against the budgeted target and against theinitial guidance given to the market; the main drivers of that successwere the larger than expected pre delivery payments received
at Airbus, and the improved management of working capital at
Airbus Helicopters.
EBIT*, compared to the budgeted target and the guidance, wasglobally good, but weighed-down by unplanned A400M provisions.
RoCE bore a limited inﬂuence.
Normalisation adjustments of EBIT* and Free Cash Flow weremade to exclude currency exchange differences against the budget
rate, or those arising from phasing mismatches. Importantly, thewindfall results of the Dassault shares sale were excluded from
EBIT* and Free Cash Flow to determine the achievement level.
On the other hand, the A400M charges were apportioned equally
between the consolidated Group performance, Airbus and Airbus
Defence and Space, so that the corresponding shortage be shared
among the parties bearing responsibility.
The Individual part results from a composite achievement of
140%, assessed by the RNC and approved by the Board on
the basis of the CEO’s performance and behaviour, mostly withrespect to the 8 Group priorities agreed at the start of the year.
For each of these, outcomes, leadership, personal performanceand contributions were examined.
The main factors determining the high assessment were:
demonstrated results on driving short-term and sustainable
performance improvements, including the actual restructuring of
the Airbus Defence and Space organisation, and good progressof an initiative for leaner and effective headquarters called the
Corporate Function Reshaping project; in deﬁning and executing
strategy: the sweeping review of the Airbus Defence and Spacedivision product portfolio, the subsequent shedding of noncore assets and the initiative to ensure the future of the spacelauncher business in a different ownership and industrial setup;actions to ensure that product lines at Airbus (A330neo) and
Airbus Helicopters remain current and competitive; numerous
encounters with key stakeholders in key markets; in the ﬁ eldof innovation: group-wide initiatives (such as eFan), and thedevelopment of a coherent Research and Technology blueprint,
with particular focus on efﬁ cient manufacturing technologies,
hybrid and electric concepts, advanced on-board energy andautonomy; in the management of people, beyond signiﬁ cantsocial mitigation measures to soften the impact of restructuring,
dedication to in-depth succession planning and to the selectionof top leadership talents; with regards to quality: improvementof customer satisfaction, deployment of an all-encompassing
Quality policy, and progress on the Cyber Security protection of
the Group. With regard to the above realisations, the RNC andthe Board considered that the CEO’s role had been decisive.
Conversely, certain areas were considered as work-in-progress,and contributed to lowering the achievement assessment,such as the operational disappointments leading to sudden
charges on the A400M programme; besides, certain on-going
objectives are repeated into 2015 priorities, such as those relating
to continuing to set a commanding tone from the top regarding
the updating of processes supporting Ethics and Compliance; thecompletion of a group vision on responsibility and eco-efﬁciency,
and the introduction of an updated group-wide environmental
policy; the implementation of the “one-roof” management of
our activities in key countries. The RNC and the Board notedthat the CEO’s performance assessment is also consistent withthe average outcome of the Executive Committee Members’
assessments.

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4.2 Interests of Directors and Principal Executive Ofﬁ cers

PERFORMANCE AGAINST TARGET 2014

TargetThresholdCommon Collective Component (50%)

137%

Individual (50%)

140%

Overall Performance Achievement

138.5%
0%

20%

40%

60%

80%

100%

Maximum

120%

140%

160%

180%

200%

d) Long-Term Incentive Plan
As stipulated in the Company’s Remuneration Policy the CEO is eligible for a Performance Unit award under the Company’s LTIP. The
value of the Performance Unit award is capped at 100% of Base Salary at the date of grant. During 2014 the CEO was granted 29,500
Performance Units.
The table below gives an overview of the Performance Units granted to the Chief Executive Ofﬁcer in 2014 pursuant to the LTIP*:
Unit plan: number of Performance Units
Granted in 2014

Thomas Enders

29,500

Vesting dates
Vesting schedule is made up of 2 tranches over 2 years:(i) 50% expected in June 2018;(ii) 50% expected in June 2019.

* There is no obligation under the Dutch Financial Supervision Act to notify the cash units under the LTIP to the AFM. The CEO’s cash units are therefore no longer reflected in the AFM register.

In 2014, the CEO received both cash payments and vested sharesin connection with the vesting of 2009 and 2010 LTIP awards:
Cash: The total cash payment to the CEO amounted to € 2,374,997.
Shares: In connection with the 2009 LTIP award, the CEO hadelected that 25% of his grant should be deferred into shares.
Therefore the CEO received 14,145 vested shares on the last
vesting date for the 2009 LTIP (19 November 2014).

Date ofgrantsShareprice atNumber grant date

Value atgrant date(Un)conditional

In connection with the 2010 LTIP award, the CEO had elected that
25% of his grant should be deferred into shares. Therefore, thevesting of 9,248 Performance Units was delayed and these will
be released in the form of shares on the last vesting date for the2010 LTIP (which will take place in 2015).
In connection with the 2011 LTIP award, the CEO had elected that
25% of his grant should be deferred into shares. Therefore, thevesting of 16,448 Performance Units will be delayed and these will
be released in the form of shares on the last vesting date for the2011 LTIP (which will take place in 2016).

Performanceachievement

Units withperformanceachievement

Dates of vesting2014 Share value
at vesting dates
3rd vesting – 28 May
2014 : € 50.37

2009

46,000€ 14.50€ 667,000

Conditional

123%

56,580 4 vestings in 2013 - 2014

4th vesting –19 November 2014 :€ 46.72
1st vesting – 16 May
2014 : € 50.24

2010

54,400€ 18.40€ 1,000,960

Conditional

136%

73,984 4 vestings in 2014 - 2015

2nd vesting –19 November 2014 :€ 46.722011*

51,400€ 21.41€ 1,100,474

Conditional

128%*

65,792 4 vestings in 2015 - 2016

Not yet known

2012

50,300€ 27.83 € 1,399,849

Conditional

Not yet known

Not yet known 4 vestings in 2016 - 2017

Not yet known

2013

30,300€ 46.17€ 1,398,951

Conditional

Not yet known

Not yet known 4 vestings in 2017 - 2018

Not yet known

2014

29,500€ 47.45€1,399,775

Conditional

Not yet known

Not yet known 2 vestings in 2018 - 2019

Not yet known

Calculations may involve rounding to the nearest unit.
* The LTIP 2011 performance achievement stands at 128%. The three year average EPS, corrected for impacts of IAS 11 accounting and of foreign currency exchange was € 2.10,
more than 35% over the comparable objective set at the time of initial grant.

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Corporate Governance
4.2 Interests of Directors and Principal Executive Ofﬁ cerse) Stock Optionsg) Retirement

The Company’s Stock Option Plan has been discontinued and noawards have been made under the plan since 2006.

As of 31 December 2014, the present value of the CEO’s pension
deﬁned beneﬁt obligation amounted to € 18,584,426 vs. 12,921,270
a year ago. While the plan beneﬁts remain identical, the present
value of the pension obligation was calculated applying a 3,6%
discount rate in 2013 compared to a 1,9% discount rate in 2014,
which mainly explains the change in value. For the ﬁscal year 2014
the current service and interest costs related to the CEO’s pension
promise represented an expense of € 1,043,679. This obligation
has been accrued in the Consolidated Financial Statements.

Following a recommendation of the RNC and in compliance withthe relevant AMF best practice recommendations, the Board of
Directors recommended setting up a Blind Trust to which certain
executives signed up after the Group’s Annual General Meetingin late May 2013. The independence of the trust protects theintegrity of the relevant executive and guarantees compliance withall applicable market regulations.
The CEO has entrusted the exercise of his options (granted between
2003 and 2006) to the Blind Trust, and thereby relinquished any
control over the trading decisions. Under this scheme, the criteria
for trading decisions are set in advance by the trust, and are
implemented by the relevant bank following a substantial time
buffer (of approximately three months) without any prior knowledge
or inﬂuence of the signatory.

The deﬁned beneﬁt obligation for the CEO’s Company pension
results from the Company’s pension policy as described above
and takes into account (1) the seniority of the CEO in the Company
and on its Group Executive Committee and (2) the signiﬁcantly
lower public pension promise deriving from the German social
security pension system, compared to a pension resulting frommembership in the French pension system.

Any exercise or sale that occurred in 2014 was executed underthe Blind Trust framework and related to the Stock Option awards
mentioned above. It appears along with the CEO’s outstanding
Stock Option awards in: “Notes to the Company Financial
Statements – Note 11: Remuneration.”h) Clawbackf) Benefits

The RNC recommended and the Board of Directors decided not
to increase non-executive fees in 2014, and therefore the nonexecutive fees remain unchanged from the level set in October 2007.
The CEO is the only Member of the Board of Directors who is notentitled to any Board membership fee.

As stipulated in the Company’s Remuneration Policy the CEO’s
beneﬁts comprise a company car and accident insurance. The
monetary value of these beneﬁts for 2014 amounted to € 68,415.

The Board has not applied any claw back in 2014.

4.2.1.5

Implementation of the Remuneration
Policy in 2014: Non-Executive Fees

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Corporate Governance
4.2 Interests of Directors and Principal Executive Ofﬁ cers

Summary table of the 2014 and 2013 fees of all non-Executive Members of the Board (current and former):
Directors’ remuneration related to 2014*

Directors’ remuneration related to 2013*

Fixum

Attendance Fees

Total

Fixum Attendance Fees

Total(in €)(in €)(in €)(in €)(in €)(in €)

Current Non Executive Board Members*
Denis Ranque(1)180,000

70,000250,000

135,000

60,000

195,000

Manfred Bischoff(2)80,00025,000105,000

60,00045,000105,000

Ralph D Crosby Jr(3)80,00035,000115,000

60,00045,000105,000

Hans-Peter Keitel(4)100,000

30,000130,000

75,00045,000120,000

Hermann-Josef Lamberti(5)110,000

35,000145,000

115,000

60,000175,000(6)

100,000

30,000130,000

75,00045,000120,000

Lakshmi N. Mittal(7)100,000

30,000130,000

95,00035,000130,000

Sir John Parker(8)110,000

35,000145,000

115,000

50,000165,000
150,000

Anne Lauvergeon(9)100,000

30,000130,000

95,00055,000Josep Piqué i Camps(10)100,000

15,000115,000

95,00050,000145,000

Jean-Claude Trichet(11)100,000

35,000135,000

95,00060,000155,000

Dominique D’Hinnin(12)

N/A

N/A

N/A

30,00010,00040,000Arnaud Lagardère(13)

N/A

N/A

N/A

45,00020,00065,000Wilfried Porth(14)

N/A

N/A

N/A

25,00010,00035,000Bodo Uebber(15)

N/A

N/A

N/A

25,0005,000

30,0001,160,000

370,000

1,530,000

1,140,00

595,000

1,735,000

Michel Pébereau

Former Non Executive Board Members

TOTAL

*
The Fixum related to 2013 was paid in 2014; the Fixum related to 2014 will be paid in 2015.
(1) New Chairman of the Company’s Board of Directors as of 01/04/2013 (Only attendance fees until 01/09/2013, application of fixed fee pro rata after 01/09/2013).
(2) New Member of the Company Board of Directors as of 01/04/2013.
(3) New Member of the Company Board of Directors as of 01/04/2013.
(4) New Member of the Company Board of Directors and RNC as of 01/04/2013.
(5) Member of the Company Board of Directors and Chairman of the Audit Committee for the entire year 2013, Member of the RNC until 31/03/2013.
(6) New Member of the Company Board of Directors and Audit Committee as of 01/04/2013.
(7) Member of the Company Board of Directors for the entire year 2013, new Member of the RNC as of 01/04/2013.
(8) Member of the Company Board of Directors and Chairman of the RNC for the entire year 2013, Member of the Audit Committee until 31/03/2013.
(9) Member of the Company Board of Directors for the entire year 2013, new Member of the Audit Committee as of 01/04/2013.
(10) Member of the Company Board of Directors for the entire year 2013, new Member of the Audit Committee as of 01/04/2013.
(11) Member of the Company Board of Directors for the entire year 2013, new Member of the RNC as of 01/04/2013.
(12) Member of the Company Board of Directors, Audit Committee and RNC until 31/03/2013.
(13) Chairman of the Company Board of Directors until 31/03/2013.
(14) Member of the Company Board of Directors and RNC until 31/03/2013.
(15) Member of the Company Board of Directors and Audit Committee until 31/03/2013.

4.2.2 Long-Term Incentives Granted to the Chief Executive Ofﬁcer
See “— 4.3.3 Long-Term Incentive Plans”.

4.2.3 Related Party Transactions
Reﬂecting Article 2:129(6) of the Dutch Civil Code, Article 18.5 of
the Articles of Association provides that “A Director shall not takepart in the deliberations or decision-making if he has a direct orindirect personal interest which conflicts with the interests of theCompany and of the enterprise connected with it. If as a result
thereof no resolution of the Board of Directors can be adopted,
the resolution is adopted by the General Meeting”.
During the years 2012, 2013 and 2014, no agreement was enteredinto by the Company with one of its Directors or principal ofﬁcers

140

or a shareholder holding more than 5% of the voting rights of
the Company outside the ordinary course of business and in
conditions other than arm’s length conditions. See “— Notes to theConsolidated Financial Statements (IFRS) — Note 36: Related party
transactions” for the year ended 31 December 2014 and “— Notes
to the Consolidated Financial Statements (IFRS) — Note 36:
Related party transactions” for the year ended 31 December 2013,
as incorporated by reference herein.

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Corporate Governance
4.3 Employee Proﬁ t Sharing and Incentive Plans

For a description of the relationships between the Company
and its principal shareholders, see “— General Description of
the Company and its Shareholders — 3.3.2 Relationships with
Principal Shareholders”. Other than the relationships between

the Company and its principal shareholders described therein,
there are no potential conﬂicts of interest between the duties to
the Company of the Directors and their respective private interests
or other duties.

4.3 Employee Proﬁt Sharing
and Incentive Plans
4.3.1

Employee Proﬁt Sharing and Incentive Agreements

The Company’s remuneration policy is strongly linked to theachievement of individual and Company objectives, both for each
Division and for the overall Group. In 2012, a Performance andRestricted Unit plan was established for the senior managementof the Group (see “— 4.3.3 Long-Term Incentive Plans”), andemployees were offered shares at favourable conditions within

the context of a new employee share ownership plan (see “— 4.3.2
Employee Share Ownership Plans”).
The success sharing schemes which are implemented at theCompany in France, Germany, Spain and the UK follow one setof common rules of the Group, ensuring a consistent applicationin these four countries.

4.3.2 Employee Share Ownership Plans
Airbus Group supports a strong employee shareholder culture. Since its creation, the Company has regularly offered qualifying
employees the opportunity to purchase shares on favourable terms through the Employee Share Ownership Plan or awarded shares
under a Free Share Plan.
In July 2014, the Board of Directors decided to cancel the ESOP scheme for 2014 due to the volatility of the share price and the ﬁnancial
situation.

4

The following table summarises the main terms of the ESOPs conducted from 2000-2013(3):YearPrice per shareNominal value per share

Number of shares issued

Date of issuance2000€ 15.30€1

11,769,259

21 September 2000

2001

€ 10.70€12,017,894

5 December 2001

2002

€ 8.86(1) / € 7.93(2)€12,022,939

4 December 2002

2003

€ 12.48€1

1,686,682

5 December 2003

2004

€ 18

€1

2,017,822

3 December 20042005

€ 18.86€1

1,938,309

29 July 2005

(1)

2007

€ 19.62 / € 17.16

(2)

€1

2,037,835

9 May 20072008

€ 12.79(1) / € 11.70(2)€12,031,820

25 July 20082009

€ 10.76€1

1,358,936

18 December 20092011

€ 22.15(1) / € 21.49(2)€12,445,527

29 July 2011

(1)

2012

(2)

€ 28.55 / € 27.07€12,177,103

30 July 20122013

€ 42.02(1) / € 44.20(2)€12,113,245

29 July 2013

(1) Shares purchased within context of Group employee savings plan.
(2) Shares purchased directly.
(3) In 2010, the normal ESOP plan was replaced through a worldwide 10 years EADS – Special Anniversary Free Share Plan for about 118,000 employees in 29 countries. Each eligible
employee was granted 10 free EADS N.V. shares, resulting in the distribution of 1,184,220 shares in total. Such shares were distributed out of treasury and therefore had no impact
on the issued share capital.

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4.3 Employee Proﬁ t Sharing and Incentive Plans

Future ESOPThe Company intends to implement an ESOP in 2015 with a
modiﬁed design, subject to approval by the Board of Directors.
The 2015 ESOP is expected to be a share matching plan whereby
the Company would match a certain number of directly acquired
shares with a grant of matching shares. The total offering would be
up to approximately 2.0 million shares of the Company, i.e. up to

0.45% of its issued share capital, open to all qualifying employees(including the CEO). Under the umbrella of the ESOP 2015, a
dedicated UK tax saving plan (Share Incentive Plan – SIP) would
also be deployed in March 2015.
Non-Executive Members of the Board are not eligible to participate
in the ESOP.

4.3.3 Long-Term Incentive Plans
Based on the authorisation granted to it by the shareholders’meetings (see dates below), the Board of Directors approved stock
option plans in 2004, 2005 and 2006. In 2009, 2010, 2011, 2012,2013 and 2014, the Board of Directors approved the granting of
Performance Units and Restricted Units in the Company. The
grant of so-called “units” will not physically be settled in shares
but represents a cash settled plan in accordance with IFRS 2.

The principal characteristics of these options as well as Performanceand Restricted Units as of 31 December 2014 are set out in the“Notes to the Consolidated Financial Statements (IFRS) — Note 35:
Share-based payment”. They are also summarised in the tables
below:

Sixth tranche
Date of shareholders’ meeting

6 May 2003

Date of Board of Directors meeting (grant date)

8 October 2004
Stock option plan

Number of options granted

7,777,280

Number of options outstanding(1)-Options granted to:■

Mr Philippe Camus

135,000■

Mr Rainer Hertrich

135,000

the 10 employees having being granted the highest
number of options during the year 2003
(fifth tranche) and 2004 (sixth tranche)

808,000■

Total number of eligible employees

Exercise date

1,495
50% of options may be exercised after a period of two years and four weeks
from the date of grant of the options; 50% of options may be exercised as of the third
anniversary of the date of grant of the options (subject to specific provisions
contained in the Insider Trading Rules – see “— General Descriptionof the Company and its Share Capital — 3.1.11 Disclosure of Holdings”).

Expiry date

7 October 2014

Conversion right

One option for one share100%(1)

VestedExercise price
Exercise price conditions€ 24.32
110% of fair market value of the shares at the date of grant

Number of exercised options

5,034,613(1) As regards to the sixth tranche, vesting of part of the options granted to the top Airbus Group executives was subject to performance conditions. As a result, part of these conditional
options have not vested and were therefore forfeited during the year 2007.

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Seventh tranche
Date of shareholders’ meeting

11 May 2005

Date of Board of Directors meeting (grant date)

9 December 2005
Stock option plan

Number of options granted
Number of options outstanding

7,981,760(1)

1,729,141

Options granted to:■

Mr Thomas Enders

135,000■

Mr Noël Forgeard

135,000

the 10 employees having being granted the highest
number of options during the year 2005
(seventh tranche)

940,000■

Total number of eligible beneficiaries

1,608
50% of options may be exercised after a period of two years from the date of grantof the options; 50% of options may be exercised as of the third anniversaryof the date of grant of the options (subject to specific provisions contained in the Insider
Trading Rules — see “— General Description of the Company and its Share Capital —3.1.11 Disclosure of Holdings”). As regards to the seventh tranche, part of the options
granted to the top Airbus Group executives was performance related.

Exercise date

Expiry date

8 December 2015

Conversion right

One option for one share100%(1)

VestedExercise price€ 33.91

Exercise price conditions

110% of fair market value of the shares at the date of grant

Number of exercised options

3,536,793(1) As regards to the seventh tranche, vesting of part of the options granted to the top Airbus Group executives was subject to performance conditions. As a result, part of these
conditional options have not vested and were therefore forfeited during the year 2008.

Eighth tranche
Date of shareholders’ meeting

4 May 2006

Date of Board of Directors meeting (grant date)18 December 2006
Stock option plan

Number of options granted

1,747,500

Number of options outstanding(1)4511,750

Options granted to:■

Mr Thomas Enders

67,500■

Mr Louis Gallois

67,500the 10 employees having being granted the highest
number of options during the year 2006
(eighth tranche)

425,000■

Total number of eligible beneficiaries

Date from which the options may be exercised

221
50% of options may be exercised after a period of two years from the date of grantof the options; 50% of options may be exercised as of the third anniversaryof the date of grant of the options (subject to specific provisions containedin the Insider Trading Rules – see “— General Description of the Company
and its Share Capital – 3.1.11 Disclosure of Holdings”)

Date of expiration

16 December 2016

Conversion right

One option for one share

Vested100%

Exercise price€ 25.65

Exercise price conditions

110% of fair market value of the shares at the date of grant

Number of exercised options

1,034,750

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4.3 Employee Proﬁ t Sharing and Incentive Plans

Eleventh tranche
Date of Board of Directors meeting (grant date)

13 November 2009
Performance and Restricted Unit plan
Performance Units

Restricted Units

2,697,740

928,660--

Mr Louis Gallois*

46,000-the 10 employees having being granted the highest
number of units during the year 2009
(eleventh tranche)

356,000

96,000

Number of units granted(1)Number of units outstanding(2)

Units granted to:■■

Total number of eligible beneficiaries

1,749
The Performance and Restricted Units will vest if the participant is still employed
by a Group company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 4 payments over 2 years:
25% expected in May 2013;
25% expected in November 2013;
25% expected in May 2014;
25% expected in November 2014.

Vesting dates

■
■
■
■

Number of vested units(2)

3,133,644

898,855(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of 150%
in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus Group) during the performance period, the Board of Directors candecide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
(2) Re-evaluation based on 123% performance achievement for the remaining outstanding Performance Units.
* For more information in respect of units granted to the Chief Executive Officer, see “— Notes to the Company Financial Statements — Note 11: Remuneration”.

Twelfth tranche
Date of Board of Directors meeting (grant date)

10 November 2010
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)2,891,540

977,780

Number of units outstanding(2)1,919,982

456,400

Mr Louis Gallois*

54,400-the 10 employees having being granted the highest
number of units during the year 2010
(twelfth tranche)

341,600

79,000

Units granted to:■■

Total number of eligible beneficiaries

Vesting dates

1,711
The Performance and Restricted Units will vest if the participant is still employed
by a Group company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 4 payments over 2 years:
25% expected in May 2014;
25% expected in November 2014;
25% expected in May 2015;
25% expected in November 2015.
■■■■

Number of vested units(2)1,795,100

467,640(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of 150%
in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus Group) during the performance period, the Board of Directors candecide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
(2) Re-evaluation based on 136% performance achievement for the remaining outstanding Performance Units.
* For more information in respect of units granted to the Chief Executive Officer, see “— Notes to the Company Financial Statements — Note 11: Remuneration”.

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4.3 Employee Proﬁ t Sharing and Incentive Plans

Thirteenth tranche
Date of Board of Directors meeting (grant date)

9 November 2011
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)2,588,950

877,750

Number of units outstanding

2,496,688

841,950

Mr Louis Gallois*

51,400-the 10 employees having being granted the highest
number of units during the year 2011 (thirteenth
tranche)320,050-

Units granted to:■■

Total number of eligible beneficiaries

1,771
The Performance and Restricted Units will vest if the participant is still employed
by a Group company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 4 payments over 2 years:
25% expected in May 2015;
25% expected in November 2015;
25% expected in May 2016;
25% expected in November 2016.

Vesting dates

■
■
■
■

Number of vested units

2,500

4,375

(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of 150%
in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus Group) during the performance period, the Board of Directors candecide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, see “— Notes to the Company Financial Statements — Note 11: Remuneration”.

Fourteenth tranche
Date of Board of Directors meeting (grant date)

13 December 2012
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)2,121,800

623,080

Number of units outstanding

2,065,012

600,740

Mr Thomas Enders*

50,300-the 10 employees having being granted the highest
number of units during the year 2012
(fourteenth tranche)

251,800-

Units granted to:■■

Total number of eligible beneficiaries

Vesting dates

4

1,797
The Performance and Restricted Units will vest if the participant is still employed
by a Group company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 4 payments over 2 years:
25% expected in May 2016;
25% expected in November 2016;
25% expected in May 2017;25% expected in November 2017.
■■■■

Number of vested units

1,000

2,800

(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of 150%
in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus Group) during the performance period, the Board of Directors candecide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, see “— Notes to the Company Financial Statements — Note 11: Remuneration”.

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Corporate Governance
4.3 Employee Proﬁ t Sharing and Incentive Plans

Fifteenth tranche
Date of Board of Directors meeting (grant date)

13 November 2013
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)1,241,020

359,760

Number of units outstanding

1,229,660

355,640

Mr Thomas Enders*

30,300-the 10 employees having being granted the highest
number of units during the year 2013
(fourteenth tranche)

173,100-

Units granted to:■■

Total number of eligible beneficiaries

1,709
The Performance and Restricted Units will vest if the participant is still employed
by a Group company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 4 payments over 2 years:
25% expected in May 2017;25% expected in November 2017;25% expected in May 2018;
25% expected in November 2018.

Vesting dates

■
■
■
■

Number of vested units--(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of 150%
in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus Group) during the performance period, the Board of Directors candecide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, see “— Notes to the Company Financial Statements — Note 11: Remuneration”.

Sixteen tranche
Date of Board of Directors meeting (grant date)

13 November 2014
Performance and Restricted Unit plan
Performance Units

Restricted Units

Number of units granted(1)1,100,620

292,580

Number of units outstanding

1,100,620

292,580

Mr Thomas Enders*

29,500-the 10 employees having being granted the highest
number of units during the year 2014
(fourteenth tranche)

176,460

Units granted to:■■-

Total number of eligible beneficiaries

Vesting dates

1,621
The Performance and Restricted Units will vest if the participant is still employed
by a Group company at the respective vesting dates and, in the caseof Performance Units, upon achievement of mid-term business performance.
Vesting schedule is made up of 2 payments over 2 years:
50% expected in June 2018;
50% expected in June 2019.
■■

Number of vested units--(1) Based on 100% target performance achievement. A minimum of 50% of Performance Units will vest; 100% in case of on-target performance achievement; up to a maximum of 150%
in case of overachievement of performance criteria. In case of absolute negative results (cumulative EBIT* of Airbus Group) during the performance period, the Board of Directors candecide to review the vesting of the Performance Units including the 50% portion which is not subject to performance conditions (additional vesting condition).
* For more information in respect of units granted to the Chief Executive Officer, see “— Notes to the Company Financial Statements — Note 11: Remuneration”.

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Corporate Governance
4.3 Employee Proﬁ t Sharing and Incentive Plans

The information in respect of stock options and performance and restricted shares cancelled and exercised during the year are set
out in “Notes to the Consolidated Financial Statements (IFRS) — Note 35: Share-based payment”.
SHAREHOLDING IN THE COMPANY OF THE MEMBERS OF THE BOARD OF DIRECTORSMember of the Board of Directors

Shareholding■

Mr Thomas Enders

46,025 ordinary shares
0 stock option■

Mr Denis Ranque

2,000 ordinary shares■

Mr Manfred Bischoff

1,292 ordinary shares■

Mr Ralph D. Crosby, Jr.

40,000 stock options

No other Member of the Board of Directors holds shares or other securities in the Company.

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Entity Responsible
for the Registration Document
5.1 Entity Responsible for the Registration Document

150

5.2 Statement of the Entity Responsible
for the Registration Document150

5.3 Information Policy

151

5.4 Undertakings of the Company regarding Information

151

5.5 Signiﬁcant Changes

151

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Entity Responsible for the Registration Document
5.1 Entity Responsible for the Registration Document

5.1 Entity Responsible for the Registration
Document
Airbus Group N.V.

5.2 Statement of the Entity Responsible
for the Registration Document
The Company declares that, having taken all reasonable care to ensure that such is the case, the information contained in the Registration
Document is, to the best of the Company’s knowledge, in accordance with the facts and contains no omission likely to affect its import.
Airbus Group N.V. represented by:Thomas Enders
Chief Executive Officer

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Entity Responsible for the Registration Document
5.5 Signiﬁ cant Changes

5.3 Information Policy■

Contact details for information:
Mr Philippe Balducchi
Head of Investor Relations and Financial Communication, Airbus
Group N.V.
1 rond-point Maurice Bellonte
P.O. Box B03-5A4
31707 Blagnac France
Telephone: +33 5 82 05 57 57
E-mail: ir@airbus.com■

Special toll-free hotlines are available to shareholders in France(0 800 01 2001), Germany (00 800 00 02 2002) and Spain(00 800 00 02 2002). An international number is also available
for the rest of the world (+33 800 01 2001)■

An e-mail box is dedicated to shareholders’ messages:
ir@airbus.com

A website, www.airbusgroup.com, provides a wide range of
information on the Company, including the Board of Directors
Report. Additionally, for the life of this Registration Document,
copies of:
the Company’s Articles of Association;
the Registration Document ﬁled in English with, and approved
by, the AFM on 3 April 2013;■
the Registration Document ﬁled in English with, and approved
by, the AFM on 4 April 2014; and■the Consolidated Financial Statements (IFRS) and the Company
Financial Statements of Airbus Group N.V. for the years
ended 31 December 2012, 2013 and 2014, together with therelated Auditors’ reports, may be inspected at the Company’s
registered ofﬁce at: Airbus Group N.V., Mendelweg 30, 2333 CS
Leiden, the Netherlands, Seat (statutaire zetel) Amsterdam,
Tel.: +31 (0)71 5245 600.
■■

5.4 Undertakings of the Company regarding
Information
Given the fact that the shares of the Company are listed onEuronext Paris, on the regulierter Markt (in the sub-segment Prime
Standard) of the Frankfurt Stock Exchange and on the Madrid,
Bilbao, Barcelona and Valencia Stock Exchanges, the Company

is subject to certain laws and regulations applicable in France,
Germany and Spain in relation to information, the main ones ofwhich are summarised in “General Description of the Company
and its Share Capital — 3.1.3 Governing Laws and Disclosures”.

5.5 Signiﬁcant Changes
As of the date of this Registration Document, there has been no signiﬁcant change in the Group’s ﬁnancial or trading position since
31 December 2014.

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Photographs:
Cover
Back Cover© Airbus/H. Goussé© Airbus/S. Ramadier

All rights reserved.

2014
ANNUAL REPORT

Airbus Group N.V.
Mendelweg 302333 CS Leiden
The Netherlands
Auriga Building
4, rue du Groupe d'Or - BP 90112
31703 Blagnac cedex - France

www.airbusgroup.com