Airbus SE
Unaudited Condensed
IFRS Consolidated Financial Information
for the year ended 31 December 2018

Contents
1 Airbus SE Unaudited Condensed IFRS Consolidated Financial Statements...................................................................................2
Unaudited Condensed IFRS Consolidated Income Statement ..........................................................................................................2
Unaudited Condensed IFRS Consolidated Statement of Comprehensive Income .............................................................................3
Unaudited Condensed IFRS Consolidated Statement of Financial Position ......................................................................................4
Unaudited Condensed IFRS Consolidated Statement of Cash Flows ...............................................................................................6
Unaudited Condensed IFRS Consolidated Statement of Changes in Equity......................................................................................82 Notes to the Airbus SE Unaudited Condensed IFRS Consolidated Financial Statements .............................................................91.

The Company .......................................................................................................................................................................92.

Accounting Policies ...............................................................................................................................................................93.

Acquisitions and Disposals .................................................................................................................................................. 15

4.

Related Party Transactions ................................................................................................................................................. 16

5.

Segment Information ........................................................................................................................................................... 17

6.

Revenue and Gross Margin ................................................................................................................................................ 18

7.

Research and Development Expenses ............................................................................................................................... 19

8.

Share of Profit from Investments Accounted for under the Equity Method and Other Income from Investments ................. 19

9.

Other Income and Other Expenses ..................................................................................................................................... 19

10.

Total Financial Result.......................................................................................................................................................... 19

11.

Income Taxes ..................................................................................................................................................................... 19

12.

Earnings per Share ............................................................................................................................................................. 20

13.

Intangible Assets and Property, Plant and Equipment ......................................................................................................... 20

14.

Investments Accounted for under the Equity Method ........................................................................................................... 20

15.

Other Investments and Other Long-Term Financial Assets ................................................................................................. 20

16.

Inventories .......................................................................................................................................................................... 21

17.

Contract Assets, Contract Liabilities and Trade Receivables ............................................................................................... 21

18.

Provisions ........................................................................................................................................................................... 21

19.

Other Financial Assets and Other Financial Liabilities ......................................................................................................... 21

20.

Other Assets and Other Liabilities ....................................................................................................................................... 22

21.

Total Equity ......................................................................................................................................................................... 23

22.

Net Cash ............................................................................................................................................................................. 23

23.

Litigation and Claims ........................................................................................................................................................... 24

24.

Number of Employees ......................................................................................................................................................... 26

25.

Events after the Reporting Date .......................................................................................................................................... 26

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

1
Airbus SE
Unaudited Condensed
IFRS Consolidated Financial Statements
Unaudited Condensed
IFRS Consolidated Income Statement(In € million)

Revenue (1)Cost of sales (1)Gross margin (1)Selling expenses
Administrative expenses
Research and development expenses
Other income
Other expenses
Share of profit from investments accounted for under the equity method (1)Other income from investments
Profit before financial result and income taxes (1)Interest income
Interest expense
Other financial result (1)Total financial result (1)Income taxes (1)Profit for the period (1)

Note
6
6

7
9
9
8
8

10
11

Attributable to:Equity owners of the parent (Net income) (1)Non-controlling interests (1)Earnings per share
Basic (1)Diluted (1)
(1)

12
12

2018
63,707(54,920)
8,787
(861)
(1,574)(3,217)
1,656
(182)
330
109
5,048
208
(440)
(531)
(763)
(1,274)
3,011

2017
59,022(52,149)
6,873
(872)
(1,567)(2,807)
981
(336)
311
82
2,665
189
(517)
1,489
1,161
(1,462)
2,364

3,054
(43)

2,361
3

€
3.94
3.92

€
3.05
3.04

Previous year figures are restated due to the application of IFRS 15.

The accompanying notes are an integral part of these Unaudited Condensed IFRS Consolidated Financial Statements.

2

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Unaudited Condensed
IFRS Consolidated Statement of Comprehensive Income(In € million)

2018
3,011

2017
2,364

Items that will not be reclassified to profit or loss:
Remeasurement of the defined benefit pension plans
Change in fair value of financial assets (2)Share of change from investments accounted for under the equity method
Income tax relating to items that will not be reclassified

(552)
(249)
3
(2)

116
0
61
(26)

Items that may be reclassified to profit or loss:
Foreign currency translation differences for foreign operations
Change in fair value of cash flow hedges
Change in fair value of financial assets (2)Share of change from investments accounted for under the equity method
Income tax relating to items that may be reclassified
Other comprehensive income, net of tax
Total comprehensive income for the period (1)108(2,959)
(80)
(11)
728
(3,014)(3)(526)
10,636396(3)(2,881)
7,773
10,13772(75)

10,09938

Profit for the period (1)Other comprehensive income

Attributable to:Equity owners of the parent (1)Non-controlling interests(1)(2)

Previous year figures are restated due to the application of IFRS 15.
IFRS 9 new classification category (prior year-end: change in fair value of available-for-sale financial assets).

The accompanying notes are an integral part of these Unaudited Condensed IFRS Consolidated Financial Statements.

3

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Unaudited Condensed
IFRS Consolidated Statement of Financial Position(In € million)

AssetsNon-current assets
Intangible assets
Property, plant and equipment
Investment property
Investments accounted for under the equity method (1)Other investments and other long-term financial assets
Non-current contract assets (1)Non-current other financial assets
Non-current other assets (1)Deferred tax assets (1)Non-current securities
Total non-current assets (1)

2018

2017

13
13

16,726
16,773
3
1,693
3,811
65
1,108
888
4,835
10,66256,564

11,62916,610
3
1,617
4,204
1
2,980
975
4,562
10,94453,52531,891
6,078
489
789
1,811
4,246
1,451
2,132
9,413
58,300334
115,198

29,737
5,487
529
496
1,979
2,937
914
1,627
12,01655,722
202
109,449

14
15
17
19
20
22

Current assets
Inventories (1)Trade receivables
Current portion of other long-term financial assets
Current contract assets (1)Current other financial assets
Current other assets (1)Current tax assets
Current securities
Cash and cash equivalents
Total current assets (1)Assets and disposal group of assets classified as held for sale
Total assets (1)
(1)

Note

16
17
15
17
19
20
22
22
3

Previous year figures are restated due to the application of IFRS 15.

4

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

(In € million)

Equity and liabilities
Equity attributable to equity owners of the parent
Capital stock
Share premium
Retained earnings (1)Accumulated other comprehensive income
Treasury shares
Total equity attributable to equity owners of the parent (1)Non-controlling interests
Total equity (1)Liabilities
Non-current liabilities
Non-current provisions (1)Long-term financing liabilities
Non-current contract liabilities (1)Non-current other financial liabilities (1)Non-current other liabilities (1)Deferred tax liabilities (1)Non-current deferred income (1)Total non-current liabilities (1)Current liabilities
Current provisions (1)Short-term financing liabilities (1)Trade liabilities (1)Current contract liabilities (1)Current other financial liabilities (1)Current other liabilities (1)Current tax liabilities
Current deferred income (1)Total current liabilities (1)Disposal group of liabilities classified as held for sale
Total liabilities (1)Total equity and liabilities (1)
(1)

Note

2018

2017

21

777
2,941
5,923
134
(51)
9,724
(5)
9,719

775
2,826
4,399
2,742
(2)
10,7402
10,742

18
22
17
19
20

11,571
7,463
15,832
8,009
460
1,318
40
44,693

9,779
8,984
16,013
6,704
298
1,002
42
42,822

18
22

7,317
1,463
16,237
26,229
2,462
5,288
732
626
60,354432
105,479
115,198

6,272
2,212
13,40625,943
2,050
3,909
1,481
506
55,779106
98,707
109,449

17
19
20

3

Previous year figures are restated due to the application of IFRS 15.

The accompanying notes are an integral part of these Unaudited Condensed IFRS Consolidated Financial Statements.

5

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Unaudited Condensed
IFRS Consolidated Statement of Cash Flows(In € million)

2018

2017

Operating activities:
Profit for the period attributable to equity owners of the parent (Net income) (1)Profit (loss) for the period attributable to non-controlling interests (1)

3,054
(43)

2,361
3

Adjustments to reconcile profit for the period to cash provided by operating activities:
Interest income
Interest expense
Interest received
Interest paid
Income tax expense (1)Income tax paid
Depreciation and amortization
Valuation adjustments (1)Results on disposals of non-current assets
Results of investments accounted for under the equity method (1)Change in current and non-current provisions (1)Contribution to plan assets
Change in other operating assets and liabilities: (1)Inventories
Trade receivables
Contract assets and liabilities
Trade liabilities
Other assets and liabilities and others
Cash provided by operating activities (2)

(208)
440
186
(292)
1,274
(897)
2,444
(1,849)
(261)
(330)
1,952
(2,519)
(633)
(671)
(881)
(684)
2,294
(691)
2,318

(189)
517
149
(501)
1,462
(152)
2,298
(1,341)
(773)
(311)
1,018
(458)
361
(2,112)
(47)
2,572
829
(881)
4,444

(2,285)(2,558)

213

177

129
0

(23)
377

(707)

(913)

597
191

532
218

320
(2,010)1,917(1,635)893(3,767)2,534(2,530)Note

Investing activities:
Purchases of intangible assets, property, plant and equipment, investment property
Proceeds from disposals of intangible assets, property, plant and equipment andinvestment property
Acquisitions of subsidiaries, joint ventures, businesses and non-controlling interests (netof cash)Proceeds from disposals of subsidiaries (net of cash)
Payments for investments accounted for under the equity method, other investments andother long-term financial assets
Proceeds from disposals of investments accounted for under the equity method, otherinvestments and other long-term financial assets
Dividends paid by companies valued at equity
Disposals of non-current assets and disposal groups classified as assets held for saleand liabilities directly associatedPayments for investments in securities
Proceeds from disposals of securities
Cash (used for) investing activities

6

3

3

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

(In € million)

Financing activities:
Increase in financing liabilities
Repayment of financing liabilities
Cash distribution to Airbus SE shareholders
Dividends paid to non-controlling interests
Payments for liability for puttable instruments
Changes in capital and non-controlling interests
Change in treasury shares
Cash provided by (used for) financing activities
Effect of foreign exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
thereof presented as cash and cash equivalents
thereof presented as part of disposal groups classified as held for sale
(1)
(2)

21

21

22
22
3

2018

2017

103
(2,411)(1,161)
0
179
117
(49)
(3,222)(54)(2,593)
12,021
9,428
9,413
15

1,703
(419)
(1,043)
(3)
0
83
0
321
(374)
1,861
10,16012,021
12,016
5

Previous year figures are restated due to the application of IFRS 15.
Cash provided by operating activities has been positively impacted by certain agreements reached with the Company’s suppliers and customers relating
to the settlement of claims and negotiation on payment terms.

The accompanying notes are an integral part of these Unaudited Condensed IFRS Consolidated Financial Statements.

7

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Unaudited Condensed
IFRS Consolidated Statement of Changes in Equity(In € million)

Balance at
31 December 2016,as reported
Restatements (1)Balance at
1 January 2017,
restated (1)Profit for the period (1)Other comprehensive
incomeTotal comprehensive
income for the period (1)Capital increase
Share-based payment(IFRS 2)
Cash distribution to Airbus
SE shareholders /Dividends paid to noncontrolling interests
Equity transaction(IAS 27)
Change in treasury shares
Cancellation oftreasury shares
Balance at
31 December 2017,
restated (1)Restatements (1) (2)Balance at
1 January 2018,
restated (1) (2)Profit for the period
Other comprehensive
incomeTotal comprehensive
income for the period
Capital increase
Share-based payment(IFRS 2)
Cash distribution to Airbus
SE shareholders /Dividends paid to noncontrolling interests
Equity transaction(IAS 27)
Change innon-controlling interests
Change in treasury shares
Cancellation oftreasury shares
Balance at
31 December 2018(1)
(2)

Equity attributable to equity holders of the parent
Accumulated othercomprehensive income
Foreign
Financial
Cashcurrency
CapitalShare Retained assets at
flowtranslation Treasury
stock premium earnings fair value hedges adjustments
shares

Noncontrolling
Totalinterests

Total
equity

773
0

2,745
0

4,987
(2,096)770
0(7,153)
0

1,538
0

(3)
3,657
0 (2,096)

(5)
0

3,652
(2,096)

773
0

2,745
0

2,891
2,361

770
0

(7,153)
0

1,538
0

(3)
0

1,561
2,361

(5)
3

1,556
2,364

0

0

151

369

7,757

(539)

0

7,738

35

7,773

0
2

0
81

2,512
0

369
0

7,757
0

(539)
0

0
0

10,09983

38
0

10,137
83

0

0

36

0

0

0

0

36

0

36

0

0

(1,043)0000 (1,043)(3)(1,046)

0
0

0
0

3
0

0
0

0
0

0
0

0
1

3
1

(28)
0

(25)
1

0

0

0

0

0

0

0

0

0

0

775
0

2,826
0

4,399
187

1,139
(367)

604
172

999
0

(2)
0

10,740(8)

2
010,742
(8)

775
0

2,826
0

4,586
3,054

772
0

776
0

999
0

(2)
0

10,732
3,054

2
(43)

10,734
3,011

0

0

(569)

(280)

(2,249)116

0 (2,982)(32)(3,014)

0
2

0
115

2,485
0

(280)
0

(2,249)
0

116
0

0
0

72
117

(75)
0

(3)
117

0

0

62

0

0

0

0

62

0

62

0

0

(1,161)0000 (1,161)

0(1,161)

0

0

(49)

0

0

0

0

(49)

68

19

0
0

0
0

0
0

0
0

0
0

0
0

0
(49)

0
(49)

0
0

0
(49)

0

0

0

0

0

0

0

0

0

0

777

2,941

5,923

492

(1,473)

1,115

(51)

9,724

(5)

9,719

Previous year figures are restated due to the application of IFRS 15. The restatement was updated due to current information.
Opening balance figures are restated due to the application of IFRS 9.

The accompanying notes are an integral part of these Unaudited Condensed IFRS Consolidated Financial Statements.
8

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 20182
Notes to the Airbus SE
Unaudited Condensed
IFRS Consolidated Financial Statements
1.

The Company

The accompanying Unaudited Condensed IFRS Consolidated Financial Statements present the financial position and the results ofoperations of Airbus SE and its subsidiaries, a European public limited-liability company (Societas Europaea) with its seat (statutairezetel) in Amsterdam, The Netherlands, its registered address at Mendelweg 30, 2333 CS Leiden, The Netherlands, and registered with
the Dutch Commercial Register (Handelsregister) under number 24288945. The Company reportable segments are Airbus, Airbus
Helicopters and Airbus Defence and Space (see “– Note 5: Segment Information”). The Company is listed on the European stock
exchanges in Paris, Frankfurt am Main, Madrid, Barcelona, Valencia and Bilbao. The Unaudited Condensed Interim IFRS Consolidated
Financial Statements were authorised for issue by the Company’s Board of Directors on 13 February 2019.

2.

Accounting Policies

The Unaudited Condensed Consolidated Financial Statements are prepared in accordance with International Financial ReportingStandards (“IFRS”), issued by the International Accounting Standards Board (“IASB”) as endorsed by the European Union (“EU”) as at
31 December 2018. They are prepared and reported in euro (“€”) and all values are rounded to the nearest million appropriately.
Due to rounding, numbers presented may not add up precisely to the totals provided and percentages may not precisely reflect theabsolute figures.
The Company has implemented the new standards IFRS 9 “Financial Instruments” and IFRS 15 “Revenue from contracts with customers”
on 1 January 2018. As a result, the Company has changed its accounting policy for revenue recognition and for the accounting of financial
instruments as detailed below.
The implementation of other amended standards and new interpretation has no material impact on the Unaudited Condensed IFRS
Consolidated Financial Statements as of 31 December 2018.

IFRS 15 “Revenue from Contracts with Customers”
In May 2014, the IASB issued IFRS 15 which establishes a single comprehensive framework for determining when to recognise revenue
and how much revenue to recognise. IFRS 15 replaced the former revenue recognition standards IAS 18 “Revenue” and IAS 11“Construction contracts” and related interpretations. The core principle of IFRS 15 is that an entity recognizes revenue to depict the transfer
of control of the promised goods and/or services (performance obligations) in an amount that reflects the consideration to which that entity
is entitled.
The Company adopted the new standard on 1 January 2018, using the full retrospective transition method. Accordingly, the Company
restated the comparative 2017 results included in 2018 Unaudited Condensed IFRS Consolidated Financial Statements. The opening
equity was restated as of 1 January 2017.
The Company has elected the practical expedients for completed contracts and contract modifications. As a result, the Company has notrestated completed contracts which began and ended within 2017 or which were completed as at the beginning of 1 January 2017.
The Company used transaction price at the date contract was completed rather than estimating variable consideration amounts in thecomparative reporting periods. The Company has reflected the aggregate effect of all of the modifications that occur before 1 January
2017 in identifying the performance obligations, determining the transaction price and allocating the transaction price.
The application of those practical expedients allows an efficient implementation of the standard especially on complex transactions(e.g. contractual amendments on military contracts) and a provision of relevant information under IFRS 15.
The Company will use the practical expedient applicable to the disclosure on the amount of the transaction price allocated to the remaining
performance obligations (i.e. backlog) and an explanation of when it expects to recognize the amount as revenue. This information will
be disclosed as at 31 December 2018 without comparative information.
The Company revised its accounting policies relative to revenue recognition, to implement IFRS 15 “Revenue from contracts withcustomers” as follows.

9Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Revenue recognition
The Company recognises revenue when it transfers the control of the promised goods and services to the customer. The Company
measures revenue, for the consideration to which the Company is expected to be entitled in exchange for transferring promised goods orservices. Variable considerations are included in the transaction price when it is highly probable that there will be no significant reversalof the revenue in the future. The Company identifies the various performance obligations of the contract and allocates the transaction
price to these performance obligations.
Advances and pre-delivery payments (contract liabilities) are normal and not considered a significant financing component as they areintended to protect the Company from the customer failing to complete its obligations under the contract.
Revenue from the sale of commercial aircraft
Revenue is recognised at a point in time (i.e. at the delivery of the aircraft). The Company estimates the amount of price concession fordelivered aircraft and treats the price concession as a reduction of both revenue and cost of sales.
Revenue from the sale of military aircraft, space systems and services
When the control of the produced good and rendered services is transferred over time to the customer, revenue is recognised over time(i.e. under the percentage of completion method).
The Company transfers control over time when:-

it produces a good with no alternative use and the Company has an irrevocable right to payment (including a reasonable margin) for
the work completed to date, in the event of termination of the contract for the convenience of the customer (e.g. Tiger contract, A400M
development performance obligation); or-

it creates a good which is controlled by the customer as the good is created or enhanced (e.g. Eurofighter contracts, some bordersecurity contracts); or-

the customer simultaneously receives and consumes the benefits provided by the Company (e.g. maintenance contracts).

For the application of the over time method (percentage of completion (PoC method)), the measure of the progress towards complete
satisfaction of a performance obligations is based on inputs (i.e. cost incurred).
When none of the criteria stated above have been met, revenue is recognised at a point in time. Revenue has been recognised at thedelivery of the aircraft under IFRS 15 from the sale of military transport aircraft, from the A400M launch contract and most of NH90 serial
helicopters contracts.
The most signiﬁcant changes result from the following:-

Several performance obligations are identiﬁed instead of recognising a single contract margin under IAS 11 (e.g. A400M, NH90
contracts). In some cases, the over time method (e.g. PoC method) revenue recognition criteria are not fulﬁlled under IFRS 15.
In particular, for A350 launch contracts, A400M series production and certain NH90 contracts, revenue and production costs relative
to the manufacture of aircraft are recognised at a point in time (e.g. upon delivery of the aircraft to the customer).

-

Under IFRS 15, measurement of the revenue takes into account variable consideration constraints in order to achieve high likelihoodthat a signiﬁcant reversal of the recognised revenue will not occur in the future. The constraint in assessing revenue at completion forsome contracts (A400M) generates a decrease in recognised revenue.

-

For the application of the over time method (PoC method), the Company measures its progress towards complete satisfaction of
performance obligations based on inputs (i.e. cost incurred) rather than on outputs (i.e. milestones achieved). For the Company’s
current long-term construction contracts progresses were usually measured based on milestones achieved (e.g. Tiger programme,
satellites, orbital infrastructures). Under IFRS 15, the Company measures progress of work performed using a cost-to-cost approach,whenever control of the work performed transfers to the customer over time.

IFRS 15 also impacts the presentation of the revenue from the sales of engines. Under IAS 18, the Company recognised revenue basedon the amount of its contracts with its customers, unless it had conﬁrmation of the amount of the price concession. In contrast, IFRS 15
requires the Company to estimate the amount of price concession in all cases and to treat the price concession as a reduction of revenue
and cost of sales. Under IFRS 15, revenue and cost of sales decrease by the amount of the estimated concession granted by theCompany’s engine supplier to their customers.
In addition to these changes, IFRS 15 introduced a new class of assets and liabilities “contract assets” and “contract liabilities”.
-

A contract asset represents the Company’s right to consideration in exchange for goods or services that the Company has transferred
to a customer when that right is conditioned by something other than the passage of time (e.g. revenue recognised from the applicationof the PoC method before the Company has a right to invoice. Prior to the implementation of IFRS 15, unbilled revenue was reported
within “trade receivables”).

-

A contract liability represents the Company’s obligation to transfer goods or services to a customer for which the customer has paid
a consideration (e.g. contract liabilities mainly include the customer advance payments received which were reported prior to theimplementation of IFRS 15 within “other liabilities”).

For any individual contract, either a contract asset or a contract liability is presented on a net basis.
The distinction between non-current and current presentation remains unchanged.

10Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

The following tables summarise the impacts on the comparative information resulting from the change in revenue recognition principles:
Condensed IFRS Consolidated Statements of Financial Position as at 31 December 2017 (1)As previously
reported

IFRS 15

As restated

AssetsNon-current assets
Intangible assets
Property, plant and equipment
Investments accounted for under the equity method
Non-current contract assets
Non-current other assets
Total non-current assets

11,62916,6101,678
024,02453,941

0
0
(61)
1
(356)
(416)

11,62916,6101,617
123,66853,525Current assets
Inventories
Trade receivables
Current contract assets
Current other assets
Cash and cash equivalents
Total current assets
Total assets

31,464
8,358
0
8,158
12,01659,996113,937(1,727)(2,871)496
30
0(4,072)(4,488)29,737
5,487
496
8,188
12,01655,924
109,449

13,351(2,609)10,742

10,153034,30244,455(374)
16,013(17,272)(1,633)

9,779
16,013
17,03042,822

6,575
13,444036,11256,131
100,586
113,937(303)(38)
25,943(25,848)(246)(1,879)(4,488)

6,272
13,40625,943
10,26455,88598,707
109,449(In € million)

Equity and liabilities
Total equity
Liabilities
Non-current liabilities
Non-current provisions
Non-current contract liabilities
Non-current other liabilities
Total non-current liabilities
Current liabilities
Current provisions
Trade liabilities
Current contract liabilities
Current other liabilities
Total current liabilities
Total liabilities
Total equity and liabilities(1)

Including reclassification between contract assets, current and non-current contract liabilities compared to previously reported in the 2018 interim
financial statements

Condensed IFRS Consolidated Income Statements for the year ended 31 December 2017
(In € million)

Revenue
Cost of sales
Gross margin
Selling, administrative and other expenses
Research and development expenses
Other income
Share of profit from investments accounted for under the equity method
and other income from investment
Profit before financial result and income taxes (EBIT)
Total financial result
Income taxes
Profit for the period

11

As previously
reported
66,767(59,160)
7,607(2,775)(2,807)981

IFRS 15(7,745)
7,011
(734)
0
0
0

As restated
59,022(52,149)
6,873(2,775)(2,807)
981

415
3,421
1,149
(1,693)
2,877

(22)
(756)
12
231
(513)

393
2,665
1,161
(1,462)2,364

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

IFRS 9 “Financial Instruments”
IFRS 9, published in July 2014, replaces the existing guidance in IAS 39 “Financial instruments: recognition and measurement”. IFRS 9
includes revised guidance on the classification and measurement of financial instruments, including a new expected credit loss model for
calculating impairment on financial assets, and the new general hedge accounting requirements. It also carries forward the guidance on
recognition and derecognition of financial instruments from IAS 39.
The Company adopted the new standard on 1 January 2018 and has elected to apply the limited exemption in IFRS 9 relating to transition
for classification and measurement and impairment, and accordingly has not restated comparative periods in the year of initial application.
As a consequence, any adjustments to carrying amounts of financial assets or liabilities are recognised at the beginning of the reporting
period, with the difference recognised in opening equity.
Classification and Measurement
From 1 January 2018, the Company classifies its financial assets according to IFRS 9 using the following measurement categories:-

those to be measured at amortised cost; and-those to be measured subsequently at fair value (either through other comprehensive income or through profit and loss).

The classification depends on the Company’s business model for managing the financial assets and the contractual terms of the cash
flows.
Financial assets at amortised cost — This category comprises assets that are held for collection of contractual cash flows where thosecash flows represent solely payments of principal and interest. It includes trade receivables.
Financial assets at fair value through other comprehensive income — This category comprises:(i)

Equity investments that are not held for trading. With the exception of dividends received, the associated gains and losses (including
any related foreign exchange component) are recognised in other comprehensive income (‘‘OCI’’). Unlike the treatment of“available-for-sale” equity investments under IAS 39, amounts presented in OCI are not subsequently transferred to profit and loss
on derecognition of the equity investment or in the event of an impairment. The Company has remeasured non-listed equity
investments for which no quoted market prices are available at fair value and determined the fair values of these equity investments
using valuation methods such as net asset values or a comparable company valuation multiples technique.

(ii)

Debt instruments where contractual cash flows are solely payments of principal and interest, and that are held both for sales andcollecting contractual cash flows. These instruments include the bond securities portfolio and are measured in a manner similar to
the “available-for- sale” debts instruments under IAS 39.

Financial assets at fair value through profit and loss — This category comprises all other financial assets – derivative instruments for
instance – that are to be measured at fair value (including equity investments for which the Company did not elect to present changes infair value in other comprehensive income).
The impact of IFRS 9 on the classification and measurement of financial assets is set out in the “measurement categories of financial
instruments” table.
Impairment
From January 2018, the Company assesses on a forward-looking basis the expected credit losses associated with its debt instruments
carried at amortised cost and fair value through OCI. The Company applies the low credit risk exemption allowing the Company to assume
that there is no significant increase in credit risk since initial recognition of a financial instrument, if the instrument is determined to have
low credit risk at the reporting date. Similarly, the Company has determined that its trade receivables and contract assets generally have
low credit risk. The Company has applied the simplified approach permitted by IFRS 9 of measuring expected credit losses of tradereceivables and contract assets on a lifetime basis from initial recognition.
Hedge Accounting
Hedging instruments in place as at 31 December 2017 qualify as hedges under IFRS 9. The Company’s risk management strategies andhedge documentation are aligned with the requirement of the new standard and hedge accounting continues to apply.
With the adoption of IFRS 9, the Company accounts for changes in the time value of its foreign currency options as a cost of hedging
through other comprehensive income and recognizes them as a separate component of equity. The cumulative cost-of-hedging will bereclassified to profit or loss when the hedged transaction affects profit or loss.
Applying the cost-of-hedging guidance to foreign currency options retrospectively results in an increase of the 2018 opening balance ofaccumulated other comprehensive income by € +172million on a net of tax basis and a corresponding decrease of the opening balanceof retained earnings. As a result, retrospective application does not change the total equity as of 1 January 2018 that would otherwise
have been reported.

12

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

New Hedge Strategy
As of 30 June 2018, the Company adopted a new hedge strategy to hedge its net exposure (US dollar revenue less US dollar cost)
resulting from commercial aircraft deliveries of specific aircraft types. The strategy more closely aligns hedge accounting with risk
management activities.
Under the new strategy the foreign exchange derivatives used as hedging instruments are designated as a hedge of a portion of the cash
flows received for each of a number of deliveries of a specific aircraft type that are expected to occur in a given month. In contrast to thefirst flow approach that was previously used (which is described in Note 35.1 to the 2017 IFRS Consolidated Financial Statements), the
new strategy assigns the hedging instruments to a specified number of monthly deliveries of a specific aircraft type and hence will allow
the hedge result to move along with the hedged deliveries in the event of a shift in deliveries.
If such a shift in hedged deliveries occurs, hedge ineffectiveness will arise to the extent the maturities of the hedging instrument and the
expected timing of the hedged cash flows are no longer perfectly aligned. In order to minimise such ineffectiveness the Company willclose the timing gap by rolling over hedges to new maturities, using foreign exchange swap contracts. The hedge results will move alongwith the hedged deliveries. In addition, the Company will designate the risk of changes in the spot element as the hedged risk in order toeliminate the ineffectiveness resulting from changes in forward points between different maturities. The forward element will be accounted
for as a cost of hedging similar to the time value of options.
According to the prospective application requirement of IFRS 9, the fair values of the legacy portfolio in place at inception of the newstrategy continue to be assigned to the previous first flow hedge regime and remain in the hedge reserve in other comprehensive income,to be recognised in profit and loss only at maturity of the originally hedged cash flows (unless those cash flows are no longer expected tooccur).
As a result of prospective application, the hedging instruments designated under the new strategy will have a non-zero fair value at hedge
inception, which may create some small ineffectiveness.
Another source of ineffectiveness will be the counterparty credit risk inherent in the hedge portfolio, as such credit risk is absent from thehedged cash flows. However, since netting arrangements are in place with all the hedge counterparties and the Company has a policy of
trading with investment grade counterparties only, the credit risk arising from its hedging instruments, and associated changes in credit
risk, have historically been negligible and are expected to remain so.
The hedging strategies otherwise used by the group are essentially the same as those used before transition to IFRS 9 and are describedin detail in Note 35.1 to the 2017 IFRS Consolidated Financial Statements. In some cases, the currency basis spread was excluded fromthe hedge on transition to IFRS 9 in order to improve hedge effectiveness. Changes in the currency basis spread will be accounted for asa cost of hedging similar to the time value of options. This change in the hedge designation had no impact on other comprehensive income
or equity as of 1 January 2018, nor will it affect future profit and loss when the hedges mature (unless exceptional circumstances apply).
IFRS 9 Total Equity Impacts
The total impact on the Company’s equity due to IFRS 9 as at 1 January 2018 is as follows:(In € million)

Opening equity, IAS 39
Increase in expected loss allowance for trade receivables and contract assets
Increase in expected loss allowance for other financial assets
Deferred tax effects
Adjustment to equity from adoption of IFRS 9Opening equity, IFRS 9

13

1 January 2018
10,742
(7)
(4)
3
(8)
10,734

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

The following table shows the measurement categories of financial instruments:(In € million)

Measurement
categories according
to IAS 39

Carrying amountaccording to IAS 39 at
31 December 2017

Measurement
Carrying amount
categories according according to IFRS 9 at
to IFRS 9
1 January 2018

AssetsOther investments and other longterm financial assets
Equity investments

Customer financing
Other loans
Trade receivables (1)Contract assets
Other financial assets
Derivative instruments (2)Non-derivative instruments
Securities

Cash and cash equivalents

Fair value through OCI
2,441 Fair value through profit
and loss
Fair value through profit
771
and loss
1,521
Amortised cost
5,487
Amortised cost
497
Amortised cost

Available-for-saleLoans and receivables
Loans and receivables
Loans and receivables
Loans and receivables
Fair value through profit
and loss
Loans and receivables
Available-for-sale
Fair value through profit
and loss

Fair value through profit
and loss
Amortised cost
Fair value through OCI
Fair value through profit
6,256
and loss
Fair value through OCI
2,085 Fair value through profit
and loss
3,675
Amortised cost
40,263
3,564
1,395
12,571

Available-for-saleLoans and receivables

Total (1)Liabilities
Financing liabilities
Bonds and commercial papers
Liabilities to financial institutions
and others (1)Finance lease liabilities
Other financial liabilities
Derivative instruments (2)European Governments'
refundable advances
Others (1)Trade liabilities (1)Total (1)
(1)
(2)

1,088
1,353
771
1,521
5,487
497

3,564
1,395
12,571
6,256
900
1,185
3,675
40,263

Amortised cost

(7,063)

Amortised cost

(7,063)

Amortised cost
Other

(3,792)(342)

Amortised cost
Other

(3,792)(342)

Fair value through profit
and loss(2,271)

Fair value through profit
and loss(2,271)

Amortised cost
Amortised cost
Amortised cost

(5,901)(582)(13,406)(33,357)

Amortised cost
Amortised cost
Amortised cost

(5,901)(582)(13,406)(33,357)

Previous year figures are restated due to the application of IFRS 15.
Most derivative instruments are designated as hedging instruments in cash flow hedges.

IFRS 16 “Leases”
In May 2016, the IASB published the new standard IFRS 16, which replaces the existing guidance on leases, including IAS 17 “Leases”,
IFRIC 4 “Determining Whether an Arrangement Contains a Lease”, SIC-15 “Operating Leases—Incentives”, and
SIC-27 “Evaluating the Substance of Transactions Involving the Legal Form of a Lease”. IFRS 16 introduces a uniform lessee accounting
model. Applying that model, a lessee is required to recognize a right-of-use asset representing the lessee’s right to use the underlying
asset and a financial liability representing the lessee’s obligation to make future lease payments.
There are exemptions for short-term leases and leases of low-value assets. Lessor accounting remains comparable to that provided by
the existing leases standard lessors continue to classify their leases as operating leases or finance leases. The standard shall be applied
for the first time in the first reporting period of a fiscal year that begins on or after 1 January 2019.
The transition to the new lease accounting from the existing rules will be accomplished using the modified retrospective method according
to IFRS 16, therefore, the cumulative effect of adopting IFRS 16 will be recognized as an adjustment to the opening balance of retained
earnings at 1 January 2019, with no restatement of comparative information.
The Company intends to use the following practical expedients provided by the standard at transition date:-

The previous determination pursuant to IAS 17 and IFRIC 4 of whether a contract is a lease will be maintained for existing contracts,
in accordance with IFRS 16,
14

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018-

On initial application of IFRS 16 to operating leases, the right-of-use to the leased asset will generally be measured at the amount of
the lease liability, using the discount rate at the date of initial application. Where accrued lease liabilities existed, the right-of-use asset
will be adjusted by the amount of the accrued lease liability under IFRS 16. Under IFRS 16, the measurement of the right-of-use atinitial application will not include initial direct costs. In some cases, the value of right-of-use assets may differ from the value of theliabilities due to offsetting against existing provisions or as a result of valuation allowances,-

Not to apply the new recognition requirements to short-term leases and to leases of low value assets as soon as the new standard iseffective.

The Company’s operating leases mainly relate to real estate assets, company cars and equipment. The Company has finalised theimplementation of a software to be used both to manage the Company’s leases and to generate IFRS 16 calculations. So far, the mostsignificant potential impact identified by the Company relates to its operating leases of real estate assets (such as land, warehouses,
storage facilities and offices).
The final impact of IFRS 16 on the Company’s Consolidated Financial Statements in the period of initial application will depend on future
economic conditions, including incremental borrowing rates to be applied for the computation of the lease liability present value as of
1 January 2019, the composition of the lease portfolio at that date and the estimation of the lease terms, as extension and early termination
options offered by lease agreements will need to be included in the calculation of the liability if their exercise or non-exercise is consideredreasonably certain.
The analysis conducted as part of the Company wide project on initial application resulted in the probable recognition of lease liabilities
totalling from € 1.2 billion to € 1.5 billion (1 January 2019) as a result of the transition. Net cash will decrease accordingly due to theincrease in lease liabilities. The impact of applying IFRS 16 on profit before finance costs and income taxes and profit for the period will
not be significant. The change in presentation of operating lease expenses will result in a corresponding improvement in cash flows fromoperating activities and a decline in cash flows from financing activities.

Use of Estimates and Judgements
In preparing the Unaudited Condensed IFRS Consolidated Financial Statements, management makes assumptions and estimates. The
underlying assumptions used for the main estimates are similar to those described in the Company’s IFRS Consolidated Financial
Statements as of 31 December 2017. These estimates are revised if the underlying circumstances have evolved or in light of new
information.

3.

Acquisitions and Disposals

Acquisitions
On 16 October 2017, Airbus, Bombardier Inc. (“Bombardier”) and Investissement Québec (“IQ”) signed an agreement that brings together
Airbus’ global reach and scale with Bombardier’s newest, state-of-the-art jet aircraft family. Under the agreement, Airbus will provide
procurement, sales and marketing, and customer support expertise to the C Series Aircraft Limited Partnership (“CSALP”), the entitythat manufactures and sells the C Series. The partnership brings together two complementary product lines.
On 8 June 2018, having received all required regulatory approvals, Airbus, Bombardier and IQ closed the C Series transaction effective
on 1 July 2018.
On 1 July 2018, Airbus has taken the control of C Series programme and acquired 50.01% Class A ownership units in CSALP. Bombardierand IQ will own 33.55% and 16.44%, respectively. Airbus has consolidated CSALP using the full integration method effective from 1 July
2018. At closing, Airbus paid US$ 1 per share to assume a net liability. Technology and inventories are the main assets acquired. Airbus
has assumed the liabilities of CSALP which are mainly related to customer contracts in the backlog, trade payables, advance payments
received and refundable advance liabilities. The functional currency of CSALP is US dollar.
Bombardier will continue with its current funding plan of CSALP. Bombardier will fund the cash shortfalls of CSALP, if required, during thesecond half of 2018, up to a maximum of US$ 225 million; during 2019, up to a maximum of US$ 350 million; and up to a maximum
aggregate amount of US$ 350 million over the following two years, in consideration for non-voting participating Class B common units of
CSALP. Airbus has the choice to reimburse Bombardier’s funding for the nominal amount plus a yearly 2% interest or for an amount equal
to the fair value of the shares of CSALP at the purchase date of Class A ownership units.
Airbus benefits from call rights in respect of all of Bombardier’s interests in CSALP at fair market value, with the amount for Class B shares
subscribed by Bombardier capped at the invested amount plus accrued interests if any, including a call right exercisable no earlier than
7.5 years following the closing, except in the event of certain changes in the control of Bombardier, in which case the right is accelerated.
Airbus also benefits from call rights in respect of all IQ’s interests in CSALP at fair market value no earlier than 4.5 years following theclosing.
Bombardier benefits from a corresponding put right whereby it could require that Airbus acquire its interest at fair market value after the
expiry of the same period. IQ will also benefit from tag along rights in connection with a sale by Bombardier of its interests in thepartnership.
Airbus used the full goodwill approach to account for this transaction. Bombardier’s and IQ’s interests in CSALP are measured at theirestimated fair value. The fair value measurement of the assets acquired and liabilities assumed has been performed by an independent
expert. According to IFRS 3, the fair values of acquired assets and assumed liabilities have been determined excluding Airbus specificsynergies (mainly with respect to volumes sold and manufacturing costs).
The transaction has been approved by the Boards of Directors of both Airbus and Bombardier, as well as the Cabinet of the Governmentof Québec. The partnership’s head office, primary assembly line and related functions will be based in Mirabel, Québec (Canada).
15

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

The following table summarises the final allocation of the purchase price to the acquired assets and the assumed liabilities at theacquisition date:(In € million)

Intangible assets (1)Property, plant and equipment
Deferred tax assets
Inventories (2)Trade receivables
Other financial assets
Other assets
Cash and cash equivalents
Total assets acquired
Provisions / Acquired customer contracts (3)Deferred tax liabilities
Trade liabilities
Contract liabilities
Other financial liabilities
Other liabilities
Total liabilities assumed
Net assets assumed
Non-controlling interests (at fair value, i.e. including synergies provided by the acquirer) (4)Consideration transferred (5)Goodwill arising on acquisition (6)
(1)

(2)
(3)

(4)

(5)

(6)

Total
1,377
252
86
660
8
350
93
129
2,955
2,609
77
270
685
827
356
4,824
1,870
2,246
(225)
3,891

Intangible assets: Mainly include the acquired technology for the A220 programme. The fair value of the programme was measured using the“multi-excess earnings method” and is equal to the present value of the after-tax cash flows attributable to future deliveries excluding existing contracts
in the backlog which are valued separately. The technology will be amortised over the expected number of aircraft to be delivered over the programme
useful life.
Inventories: The fair value of the inventories has been measured considering net contractual selling prices.
Acquired customer contracts: This represents the present value of the excess of expected fulfilment costs over contractual selling prices for all acquired
customer contracts in the backlog. Estimated fulfilment costs include both direct costs that will be recognised in gross margin and contributory asset
charges to reflect the return required on other assets that contribute to the generation of the forecast cash flows. This liability will be released as a
reduction of cost of sales based on the delivered aircraft considered in the measurement of the liability.
Non-controlling interests: Airbus has recognised a financial liability at fair value for the estimated exercise price of the written put options on
non-controlling interests (Bombardier put option and IQ tag along). According to the accounting policy of the company, changes in the fair value of theliability are recognised directly in equity.
Consideration transferred: Airbus paid US$ 1 per share (754 shares) to acquire 50.01% of CSALP and received 100,000,000 warrants which are each
entitled to one Class B Bombardier common share at a strike price equal to the US equivalent of Can$ 2.29. The fair value amounted to US$ 263
million as at 1 July 2018. As a result, the consideration transferred is negative.
Goodwill: The goodwill mostly represents Airbus specific synergies expected from the acquisition, which have been excluded from the fair value
measurement of the identifiable net assets. These synergies mainly relate to higher expected volumes of aircraft sold and lower manufacturing costs.
CSALP is part of the cash generating unit (“CGU”) Airbus and will be tested for impairment on an annual basis. The opening balance sheet after
purchase price allocation of CSALP has been audited as at 1 July 2018. In accordance with IFRS 3 “Business Combinations”, the opening balance
sheet of CSALP might vary during the 12 month allocation period which ends 1 July 2019. Airbus will retrospectively adjust the initial accounting toreflect new information that would have affected the recognition or the measurement of these amounts as of 1 July 2018.

Disposals
On 7 March 2018, the Company finalised the sale of Plant Holdings, Inc., held by the Airbus DS Communications Inc. business,to Motorola Solutions after receiving the required regulatory approvals. Airbus Defence and Space recognised a gain of € 159 million,
reported in other income.
On 1 October 2018, the Company completed the disposal of its subsidiary Compañía Española de Sistemas Aeronáuticos, S.A.
(“CESA”) to Héroux-Devtek Inc. (“Héroux-Devtek”), for a purchase price of € 114 million.
Assets and Disposal Groups Classified as Held for Sale
As of 31 December 2018, the Company accounted for assets and disposal groups of assets classified as held for sale in the amountof € 334 million (2017: € 202 million). Disposal group of liabilities classified as held for sale as of 31 December 2018 amount to € 432
million (2017: € 106 million). In 2018 and 2017, it is related to Alestis Areospace S.L and to non-core businesses entities within Airbus
Defence and Space, respectively.

4.

Related Party Transactions

The Company has entered into various transactions with related entities; carried out in the normal course of business.
The Company participates in the UK in several funded trustee-administered pension plans, some of which have BAE Systems as principal
employer.

16

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

5.

Segment Information

The Company operates in three reportable segments which reflect the internal organisational and management structure according to thenature of the products and services provided.


Airbus (formerly Airbus Commercial Aircraft and Headquarters) — Development, manufacturing, marketing and sale of commercial
jet aircraft of more than 100 seats; aircraft conversion and related services; development, manufacturing, marketing and sale ofregional turboprop aircraft and aircraft components. It also includes the holding function of the Company and its bank activities.



Airbus Helicopters — Development, manufacturing, marketing and sale of civil and military helicopters; provision of helicopter
related services.



Airbus Defence and Space — Military Aircraft design, development, delivery, and support of military aircraft such as combat,
mission, transport and tanker aircraft as well as Unmanned Aerial systems and their associated services. Space Systems design,development, delivery, and support of full range of civil and defence space systems for telecommunications, earth observations,navigation, science and orbital systems. Communication, Intelligence & Security provision of services around data processing fromplatforms, secure communication and cyber security. In addition, the main joint ventures design, develop, deliver, and support missile
systems as well as space launcher systems.

The following tables present information with respect to the Company’s business segments. As a rule, inter-segment transfers are carriedout on an arm’s length basis. Inter-segment sales predominantly take place between Airbus and Airbus Defence and Space and between
Airbus Helicopters and Airbus. Other activities not allocable to the reportable segments, together with consolidation effects, are disclosed
in the column “Transversal/Eliminations”.
The Company uses EBIT as a key indicator of its economic performance.
Business segment information for the year ended 31 December 2018 is as follows:(In € million)

Total revenue
Internal revenue
Revenue
thereof:sales of goods at a point in timesales of goods over time
services, including sales of spare parts
Profit (loss) before financial result and income
taxes (EBIT)
thereof research and development expenses
Interest result
Other financial result
Income taxes
Profit for the period

Airbus47,970(771)
47,199AirbusHelicopters
5,934
(411)
5,523

AirbusDefenceand Space
11,063(78)
10,98544,175
23
3,001

2,917
362
2,244

3,080
4,579
3,326

0
0
0

50,172
4,964
8,571

4,295
(2,214)

366
(315)

676
(328)

(289)
(360)

5,048
(3,217)(232)(531)(1,274)
3,011

Airbus
43,486(819)
42,667

AirbusHelicopters
6,335
(476)
5,859

AirbusDefence andSpace
10,596(100)
10,496

Transversal /Eliminations
0
0
0

Consolidated
Airbus60,417(1,395)59,022

39,955
0
2,712

2,898
332
2,629

2,015
5,624
2,857

0
0
0

44,868
5,956
8,198

2,257
(1,842)

247
(306)

462
(322)

(301)
(337)

2,665
(2,807)(328)
1,489(1,462)
2,364

Transversal / Consolidated
AirbusEliminations
0
64,9670(1,260)063,707

Business segment information for the year ended 31 December 2017 is as follows: (1)(In € million)

Total revenue
Internal revenue
Revenue
thereof:sales of goods at a point in timesales of goods over time
services, including sales of spare parts
Profit (loss) before financial result and income
taxes (EBIT)
thereof research and development expenses
Interest result
Other financial result
Income taxes
Profit for the period(1)Previous year figures are restated due to the application of IFRS 15. The divisional figures are restated due to the new segment structure.

17

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

6.

Revenue and Gross Margin

Revenue increased by € +4,685 million to € 63,707 million (2017 (restated): € 59,022 million). The increase relates mainly to Airbus(€ +4,484 million), mostly driven by higher deliveries of 800 aircraft (in 2017: 718 aircraft), and to Airbus Defence and Space (€ +467
million), principally reflecting an increase in Military Aircraft. This was partly reduced due to the perimeter change at Airbus Helicopters(€ -401 million).
Revenue by geographical areas based on the location of the customer is as follows:(In € million)

2018
23,297
17,78011,144
6,379
1,437
3,670
63,707Asia-Pacific
EuropeNorth America
Middle East
Latin America
Other countries
Total
(1)

2017 (1)21,31915,767
10,836
7,211
894
2,995
59,022Previous year figures are restated due to the application of IFRS 15.

The gross margin increased by € +1,914 million to € 8,787 million compared to € 6,873 million in 2017 (restated), mainly driven by higherdeliveries, improved performance and favourable foreign exchange impact at Airbus, partly offset by impairments and provisions
recognised on the A380 programme. It also reflects a positive impact from lower charges at Airbus Defence and Space on the A400M
programme. The gross margin rate increased from 11.6% (restated) to 13.8%.
In 2018, Airbus has delivered 93 A350 XWB aircraft. New order intakes, cancellations, delivery postponements and other contractual
agreements to the end of December 2018 have been reflected in the financial statements.
The industrial ramp-up is progressing and associated risks continue to be closely monitored in line with the schedule, aircraft performanceand overall cost envelope, as per customer commitments. Despite the progress made, challenges remain with recurring cost convergenceas the ramp-up continues.
In 2018, the Company’s largest A380 operator has reviewed its aircraft fleet strategy going forward and has concluded it is forced torestructure and reduce its A380 order by 39 aircraft. The Company entered into discussions with the customer in late 2018 which finallyresulted in the signature of a head of agreement on 11 February 2019. Without this customer’s A380 order, the Company has no
substantial order backlog and no basis to sustain A380 production, despite all sales and marketing efforts in recent years. As aconsequence of this decision, deliveries of the A380 will cease in 2021.
At year-end 2018, in view of the above, the Company has reassessed accordingly the expected market assumptions and the recoverability
and depreciation method of specific assets allocated to the A380 programme. As a result, the Company has impaired specific A380 assets
in the amount of € 167 million, recognised an onerous contract provision for an amount of € 1,257 million and updated the measurementof refundable advances including interest accretion for a total amount of € 1,426 million. As a consequence, the recognition of the onerous
contract provision as well as other specific provisions and the remeasurement of the liabilities have negatively affected the consolidated
income statement before taxes by a net € 463 million in EBIT and positively impacted the other financial result by € 177 million.
17 A400M aircraft were delivered in 2018. In total, 74 aircraft have been delivered as of 31 December 2018. The Company continued with
development activities toward achieving the revised capability roadmap with the achievement of an important development milestone
according to schedule. Retrofit activities are progressing in line with the customer agreed plan.
In 2017, the Company entered into discussions with OCCAR and the customer Nations that resulted in the signature of a Declarationof Intent (“DOI”) on 7 February 2018 agreeing on a global re-baselining of the contract, including a revised aircraft delivery schedule,
an updated technical capability roadmap and a revised retrofit schedule. The DOI represents an important step towards reachinga contractually binding agreement also mitigating the commercial exposure while satisfying customer needs with regard to capabilities
and availability of the aircraft. A detailed review of the programme concluded in the fourth quarter of 2017 including an estimate of thefinancial impacts of the above mentioned adaptations on schedule, capabilities and retrofit resulted in an update of the loss making
contract provision of € 1,299 million for the year 2017 (restated equivalent loss following the implementation of IFRS 15 was € 992 million
for the year 2017).
In 2018, the Company has been working together with OCCAR and concluded the negotiations on a contract amendment. The customer
Nations are now set to endorse the agreement to allow pursuing the domestic approval processes with the objective to sign the contract
amendment in the first half-year 2019. In the fourth quarter 2018 an update of the contract estimate at completion has triggered a net
additional charge of € 436 million. This reflects the outcome of the negotiations, updated estimates on the export scenario during thelaunch contract phase of the A400M programme as well as applicable escalation and some cost increases. Risks remain on developmentof technical capabilities and the associated costs, on securing sufficient export orders in time, on aircraft operational reliability in particularwith regards to engines, and on cost reductions as per the revised baseline.
The A400M contractual SOC 1, SOC 1.5, SOC 2, SOC 2.5 and SOC 3 development milestones remain to be achieved. SOC 1 fell due
end October 2013, SOC 1.5 fell due end December 2014, SOC 2 end of December 2015 and SOC 2.5 end of October 2017.
The associated termination rights became exercisable by OCCAR on 1 November 2014, 1 January 2016, and 1 January 2017,
respectively. Management judges that it is highly unlikely that any of these termination rights will be exercised as with the upcoming
contract amendment these termination rights will be completely reviewed.

18

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 20187.

Research and Development Expenses

Research and development expenses increased by € +410 million to € 3,217 million compared to € 2,807 million in 2017, primarilyreflecting R&D activities on the A320 programme. In addition, an amount of € 91 million of development costs has been capitalised, mainly
related to Airbus Helicopters programmes.

8.

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

Share of profit from investments under the equity method and other income from investments increased by € +46 million to € 439
million compared to € 393 million in 2017 (restated).

9.

Other Income and Other Expenses

Other income increased by € +675 million to € 1,656 million compared to € 981 million in 2017. This increase is mainly related to therelease of liabilities on the A380 programme (see “– Note 6: “Revenue and Gross Margin”) and the gain following the disposal of Plant
Holdings, Inc. In 2017, it mainly included the capital gain of € 604 million from the sale of the defence electronics business at Airbus
Defence and Space. For more details, see “– Note 3: Acquisitions and Disposals”.
Other expenses decreased by € -154 million to € -182 million compared to € -336 million in 2017, which included the arbitral award relating
to the Republic of China (Taiwan). For more details, see “– Note 22: Litigation and Claims”.

10.

Total Financial Result

Total financial result deteriorated by € -1,924 million to € -763 million compared to € 1,161 million in 2017 (restated). This is due to anegative impact from foreign exchange valuation of monetary items and the revaluation of financial instruments, partly compensated by
the net effect of the change of treatment of certain financial instruments under IFRS 9. In addition, in 2017 it included the impact of thedecrease in the European Governments’ refundable advances primarily related to the A380 programme.

11.

Income Taxes

The income tax expense of € -1,274 million (2017 (restated): € -1,462 million) corresponds to an effective tax rate of 29.7%(2017 (restated): 38.2%).
In 2018, the effective tax rate was mainly impacted by non-realised tax losses in the period leading to additional deferred tax asset
impairment. This was partially offset by the tax-free sale of Plant Holdings Inc. (see “– Note 3: Acquisitions and Disposals”). Without these
impacts, the effective tax rate would be approximately 26%.
In 2017, the effective tax rate was mainly impacted by non-realised tax losses in the period leading to additional deferred tax asset
impairment. It also included an additional income tax charge related to the French corporate tax surcharge and the reduction in deferred
tax asset due to the income tax rate decrease in the US, both enacted end of 2017. This was partially compensated by the disposal of the
defence electronics business, which is taxed at a reduced rate. Without these impacts, the effective tax rate would be approximately 26%.

19

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 201812.

Earnings per ShareProfit for the period attributable to equity owners of the parent (Net income) (1)Weighted average number of ordinary shares
Basic earnings per share (1)
(1)

2018
€ 3,054 million
775,167,941€ 3.942017€ 2,361 million
773,772,702€ 3.05Previous year figures are restated due to the application of IFRS 15.

Diluted earnings per share – The Company’s categories of dilutive potential ordinary shares are share-settled Performance Units relating
to Long-Term Incentive Plans (“LTIP”) and the convertible bond issued on 1 July 2015. During 2018, the average price of theCompany’s shares exceeded the exercise price of the share-settled Performance Units and therefore 752,107 shares (2017: 505,536
shares) were considered in the calculation of diluted earnings per share. The dilutive effect of the convertible bond was also consideredin the calculation of diluted earnings per share in 2018, by adding back € 7 million of interest expense to the profit for the period attributable
to equity owners of the parent (2017: € 7 million) and by including 5,022,990 of dilutive potential ordinary shares.

Profit for the period attributable to equity owners of the parent (Net income),
adjusted for diluted calculation (1)Weighted average number of ordinary shares (diluted) (2)Diluted earnings per share (1)
(1)
(2)

13.

2018

2017

€ 3,061 million
780,943,038€ 3.92€ 2,368 million
779,301,228€3.04

Previous year figures are restated due to the application of IFRS 15.
Dilution assumes conversion of all potential ordinary shares.

Intangible Assets and Property, Plant and Equipment

Intangible assets increased by € +5,097 million to € 16,726 million (2017: € 11,629 million). Intangible assets mainly relate to goodwill of€ 13,039 million (2017: € 9,141 million). The increase is primarily due to the acquisition of CSALP (see “– Note 3: “Acquisitions andDisposals”).
The annual impairment tests performed in 2018 led to no impairment charge.
Property, plant and equipment increased by € +163 million to € 16,773 million (2017: € 16,610 million), mainly at Airbus Defence andSpace (€ +150 million). Property, plant and equipment includes leased assets of € 45 million (2017: € 52 million).

14.

Investments Accounted for under the Equity Method

Investments accounted for under the equity method increased by € +76 million to € 1,693 million (2017 (restated): € 1,617 million) andmainly include the equity investments in ArianeGroup, MBDA and ATR GIE.

15.

Other Investments and Other Long-Term Financial Assets(In € million)

Other investments
Other long-term financial assets
Total non-current other investments and other long-term financial assets
Current portion of other long-term financial assets
Total

31 December
2018
2,267
1,544
3,811
489
4,300

2017
2,441
1,763
4,204
529
4,733

Other investments mainly comprise the Company’s participations. The significant participations at 31 December 2018 include theremaining investment in Dassault Aviation (Airbus share: 9.89%, 2017: 9.93%) amounting to € 999 million (2017: € 1,071 million).
Other long-term financial assets and the current portion of other long-term financial assets include other loans in the amount of€ 1,523 million as of 31 December 2018 (2017: € 1,521 million), and the sales finance activities in the form of finance lease receivables
and loans from aircraft financing.

20

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 201816.

Inventories

Inventories of € 31,891 million (2017 (restated): € 29,737 million) increased by € +2,154 million. This is driven by Airbus(€ +2,128 million), reflecting an increase in work in progress associated with the A320 programme ramp-up, including the impact of lateengine deliveries.

17.

Contract Assets, Contract Liabilities and Trade Receivables

As of 31 December 2018, contract assets include receivables from revenue recognised on over time contracts in the amount of € 10,380
million (2017: € 11,349 million) and contract liabilities include customer advance payment received in the amount of € 50,281 million(2017: € 47,580 million).

18.

Provisions
31 December
2018
7,072
11,816
18,888
11,571
7,317(In € million)

Provisions for pensions
Other provisions (1)Total (1)thereof non-current portion (1)thereof current portion (1)
(1)

2017
8,361
7,690
16,051
9,779
6,272

Previous year figures are restated due to the application of IFRS 15.

Provisions for pensions decreased mainly due to contributions made into the various pension vehicles.
Other provisions are presented net of programme losses against inventories (see “– Note 16: Inventories”) and increased due to theinclusion of liabilities related to acquired customer contracts linked to the acquisition of CSALP (see “– Note 3: “Acquisitions andDisposals”) and due to the A380 net charge recorded in 2018 (see “– Note 6: “Revenue and Gross Margin”).
A restructuring provision associated with the re-organisation of the Company of € 160 million was recorded at year-end 2016, following
the communication of the plan to the employees and the European Works Council in November 2016. The French social plan was agreed
between the Company and the works council in June 2017. The German social plan was agreed between the Company and the works
councils in September 2017, and the reconciliation of interests were finalized on 21 February 2018.
In Airbus Helicopters, the restructuring plan launched in 2016 was signed by the three representative trade unions and validated by theWork Administration Agency (DIRECCTE) in March 2017.
An H225 Super Puma helicopter was involved in an accident on 29 April 2016. Management is cooperating fully with the authorities andhave agreed a retrofit plan for the implementation of corrective measures. An estimate of the related net future costs has been preparedand is included in other provisions.

19.

Other Financial Assets and Other Financial Liabilities

Other Financial Assets
31 December
2018
1,031
77
1,108
1,082
286
443
1,811
2,919

(In € million)

Positive fair values of derivative financial instruments
OthersTotal non-current other financial assets
Receivables from related companies
Positive fair values of derivative financial instruments
OthersTotal current other financial assets
Total

21

2017
2,901
79
2,980
992
663
324
1,979
4,959

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Other Financial Liabilities
31 December
2018
1,132
4,233
2,644
8,009
1,623
344
175
320
2,462
10,471(In € million)

Liabilities for derivative financial instruments
European Governments' refundable advances
Others (1)Total non-current other financial liabilities (1)Liabilities for derivative financial instruments
European Governments' refundable advances
Liabilities to related companies (1)OthersTotal current other financial liabilities (1)Total (1)
(1)

2017
1,127
5,537
40
6,704
1,144
364
199
343
2,050
8,754

Previous year figures are restated due to the application of IFRS 15.

The total net fair value of derivative financial instruments deteriorated by € -2,731 million to € -1,438 million (2017: € 1,293 million) as aresult of the strengthening of the US dollar versus the euro associated with the mark to market valuation of the hedge portfolio.
As of 31 December 2018, the total hedge portfolio with maturities up to 2024 amounts to US$ 81.9 billion (2017: US$ 88.7 billion) andcovers a major portion of the foreign exchange exposure expected over the period of the operative planning. The average US$/€ hedge
rate of the US$/€ hedge portfolio until 2024 amounts to 1.24 US$/€ (2017: 1.23 US$/€) and for the US$/£ hedge portfolio until 2023
amounts to 1.40 US$/£ (2017: 1.43 US$/£).
The European Governments’ refundable advances decreased by € -1,324 million to € 4,577 million (2017: € 5,901 million), primarily related
to the update on the A380 programme (see “– Note 6: Revenue and Gross Margin”).

20.

Other Assets and Other Liabilities

Other Assets(In € million)

Cost to fulfil a contract (1)Prepaid expenses (1)Others (1)Total non-current other assets (1)Value added tax claims
Cost to fulfil a contract (1)Prepaid expenses (1)OthersTotal current other assets (1)Total (1)(1)

31 December
2018
777
33
78
888
3,255
464
121
406
4,246
5,134

2017
868
15
92
975
1,892
522
146
377
2,937
3,912

31 December
2018
460
460
2,706
2,582
5,288
5,748

2017
298
298
1,397
2,512
3,909
4,207

Previous year figures are restated due to the application of IFRS 15.

Other Liabilities(In € million)

Others (1)Total non-current other liabilities (1)Tax liabilities (excluding income tax)
OthersTotal current other liabilities (1)Total (1)(1)

Previous year figures are restated due to the application of IFRS 15.

22

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 201821.

Total Equity

The Company’s shares are exclusively ordinary shares with a par value of € 1.00. The following table shows the development of thenumber of shares issued and fully paid:
2018774,556,062
1,811,819
776,367,881(636,924)
775,730,957(In number of shares)

Issued at 1 January
Issued for ESOP
Issued at 31 December
Treasury shares
Outstanding at 31 December

2017
772,912,869
1,643,193
774,556,062(129,525)
774,426,537

Holders of ordinary shares are entitled to dividends and to one vote per share at general meetings of the Company.
Equity attributable to equity owners of the parent (including purchased treasury shares) amounts to € 9,724 million (2017 (restated):€ 10,740 million) representing a decrease of € -1,016 million. This is due to a decrease in other comprehensive income of € -2,982 million,
principally related to the mark to market revaluation of the hedge portfolio of € -2,249 million, a change in actuarial gains and losses
income of € -569 million and a dividend payment of € -1,161 million (€ 1.50 per share), partly compensated by a net income for the periodof € 3,054 million.
Non-controlling interests (“NCI”) from non-wholly owned subsidiaries decreased to € -5 million as of 31 December 2018(2017 (restated): € 2 million). These NCI do not have a material interest in the Company’s activities and cash flows.

22.

Net Cash

The net cash position provides financial flexibility to fund the Company’s operations, to react to business needs and risk profile and toreturn capital to the shareholders.
31 December
2018
9,413
2,132
10,662
22,207(1,463)(7,463)
13,281(In € million)

Cash and cash equivalents
Current securities
Non-current securities
Gross cash position
Short-term financing liabilities
Long-term financing liabilities
Total

2017
12,016
1,627
10,944
24,587(2,212)(8,984)
13,391

The net cash position on 31 December 2018 amounted to € 13,281 (2017: € 13,391 million), with a gross cash position of€ 22,207 million (2017: € 24,587 million).

Cash and Cash Equivalents
Cash and cash equivalents are composed of the following elements:
31 December
2018
1,862
6,576
984
6
9,428
15
9,413

(In € million)

Bank account and petty cash
Short-term securities (at fair value through profit and loss)
Short-term securities (at fair value through OCI) (1)OthersTotal cash and cash equivalents
Recognised in disposal groups classified as held for sale
Recognised in cash and cash equivalents
(1)

2017
3,672
6,256
2,085
8
12,021
5
12,016IFRS 9 new classification category (prior year-end: available-for-sale).

Only securities with a maturity of three months or less from the date of the acquisition, that are readily convertible to known amounts ofcash and which are subject to an insignificant risk of changes in value, are recognised in cash equivalents.

Securities
The Company’s security portfolio amounts to € 12,794 million and € 12,571 million as of 31 December 2018 and 2017, respectively. The
security portfolio contains a non-current portion classified at fair value through OCI of € 10,662 million (2017: € 10,944 million availablefor-sale securities), and a current portion of € 2,132 million (2017: € 1,627 million).

23

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Financing Liabilities(In € million)

Bonds and commercial papers
Liabilities to financial institutions
Loans
Finance lease liabilities
Others (1)31 December 2018
Bonds and commercial papers
Liabilities to financial institutions
Loans
Finance lease liabilities
Others (1)31 December 2017(1)

Not exceeding
1 year
0
86
70
23
1,284
1,463
512
290
144
17
1,249
2,212

Over 1 year
up to 5 years
2,386
150
203
146
1
2,886
1,524
1,397
200
139
1
3,261

More than
5 years
4,273
117
26
161
0
4,577
5,027
325
185
186
0
5,723

Total
6,659
353
299
330
1,285
8,926
7,063
2,012
529
342
1,250
11,196

Included in “others” are financing liabilities to joint ventures.

Long-term financing liabilities, mainly comprising bonds and liabilities to financial institutions, decreased by € -1,521 million to € 7,463
million (2017: € 8,984 million), as a result of early settlement of liabilities to financial institutions with the European Investment Bank (“EIB”).
Short-term financing liabilities decreased by € -749 million to € 1,463 million (2017: € 2,212 million). The decrease in short-term
financing liabilities is mainly related to the settlement of a Euro Medium Term Note (“EMTN”) bond in September 2018.

23.

Litigation and Claims

The Company is involved from time to time in various legal and arbitration proceedings in the ordinary course of its business, the mostsignificant of which are described below. Other than as described below, the Company is not aware of any material governmental, legal
or arbitration proceedings (including any such proceedings 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 Airbus SE’s or the Company’s financial position or
profitability.
If the Company concludes that the disclosures relative to contingent liabilities can be expected to prejudice seriously its position in a
dispute with other parties, the Company limits its disclosures to the nature of the dispute.

WTO
Although the Company is not a party, the Company 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 the extension until the end of 2040 of subsidies
originally granted by the State of Washington to Boeing and other US aerospace firms until 2024.
On 1 June 2011, the WTO adopted the Appellate Body’s final report in 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, thematter was referred to the WTO for further review pursuant to WTO rules. A decision was published in May 2018 in which the WTO
clarified that the EU and the Company have achieved compliance in respect of the majority of the subsidies at issue but considered thatsome remaining obligations required minor adjustments, which have since been addressed by the EU. Because the US did not agree on
the EU compliance efforts, the US requested the resumption of Article 22.6 arbitration proceedings to quantify the amount ofcountermeasures against the EU. In September 2018, the US requested an annual amount of countermeasures of US$ 11.2 billion. The
Company considers the US' request unjustified given the measures taken to comply with the Appellate Body decision of May 2018. The
Company has worked with the European Commission and the Member State governments to fully implement the WTO findings in theAppellate Body’s decision and asserts that the new measures taken render the sanctions request moot.
On 23 March 2012, the WTO adopted the Appellate Body’s final report in the case brought by the EU assessing funding to Boeing fromthe US. On 23 September 2012, the US 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 EU did not agree, the matter is now
under WTO review pursuant to WTO rules.
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, is reached between the parties, the litigation is expected to continue forseveral years.

24

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

GPT
In August 2012, the UK Serious Fraud Office (“SFO”) announced that it had opened a formal criminal investigation in relation to GPTSpecial Project Management Ltd (“GPT”), a subsidiary operating in Saudi Arabia that the Company acquired in 2007. The investigation
relates to issues initially raised by a whistleblower concerning contractual arrangements originating prior to GPT’s acquisition andcontinuing thereafter. The Company has engaged with the SFO throughout and continues to actively cooperate with the investigation.

Eurofighter Austria
In February 2017, the Austrian Federal Ministry of Defence raised criminal allegations against Airbus Defence and Space GmbH andEurofighter Jagdflugzeug GmbH for wilful deception and fraud in the context of the sale of the Eurofighter aircraft to Austria and respective
damage claims. After the Austrian Federal Ministry of Defence raised its criminal allegations, the Austrian public prosecutor opened aninvestigation against Airbus Defence and Space GmbH, Eurofighter Jagdflugzeug GmbH and former and current employees of the twoentities. The Company has filed several submissions to the Vienna Public Prosecutor in response to the allegations of deception in the
procurement of Eurofighter combat aircraft made by the Austrian Defence Minister. The Company is cooperating fully with the authorities.

Investigation by the UK SFO and France’s PNF and Related Commercial Litigation
In the context of review and enhancement of its internal compliance improvement programme, the Company discovered misstatements
and omissions relating to information provided in respect of third party consultants in certain applications for export credit financing for theCompany’s customers. In early 2016, the Company informed the UK, German and French Export Credit Agencies (“ECAs”) of theirregularities it had discovered. The Company made a similar disclosure to the UK Serious Fraud Office (“SFO”). In August 2016, the SFO
informed the Company that it had opened an investigation into allegations of fraud, bribery and corruption in the civil aviation business ofAirbus relating to irregularities concerning third party consultants (business partners). In March 2017, France’s Parquet National Financier(“PNF”) informed the Company that it had also opened a preliminary investigation into the same subject and that the two authorities would
act in coordination going forward. The Company is cooperating fully with both authorities including in respect of potential issues acrossthe Company's business. As part of the Company's engagement with the US authorities, the latter have requested information relating toconduct forming part of the SFO/PNF investigation that could fall within US jurisdiction. The Company is cooperating with the US
authorities in close coordination with the SFO and PNF. The investigations and any penalties potentially levied as a result could havenegative consequences for the Company. The potential imposition of any monetary penalty (and the amount thereof) or other sanction
including tax liability arising from the investigations will depend on the ultimate factual and legal findings of the investigation, and could
have a material impact on the financial statements, business and operations of the Company. However, at this stage it is too early todetermine the likelihood or extent of any such possible consequence. Investigations of this nature could also result in (i) civil claims or
claims by shareholders against the Company (ii) adverse consequences on the Company’s ability to obtain or continue financing for
current or future projects (iii) limitations on the eligibility of group companies for certain public sector contracts and/or (iv) damage to theCompany’s business or reputation via negative publicity adversely affecting the Company’s prospects in the commercial market place.
In light of these investigations, the Company enhanced certain of its policies, procedures and practices, including ethics and complianceand export control. The Company has revised and implemented improved procedures, including those with respect to its engagement ofconsultants and other third parties, in particular in respect of sales support activities. The Company believes that these enhancements to
its controls and practices will best position it for the future, particularly in light of advancements in regulatory standards. Several consultants
and other third parties have initiated commercial litigation and arbitration against the Company seeking relief. The enhancement of its
controls and practices has led to additional commercial litigation and arbitration against the Company and may lead to other civil law orcriminal law consequences in the future, which could have a material impact on the financial statements, however at this stage it is too
early to determine the likelihood or extent of any liability.

ECA Financing
The Company and the ECAs reached agreement on a process under which it is able to resume making applications for ECA-backed
financing for its customers across the Company on a case-by-case basis for a limited number of transactions.

Other Investigations
The Company is cooperating fully with the authorities in a judicial investigation in France related to Kazakhstan. In this spirit, the Company
asked to be interviewed by the investigating magistrates and has been granted the status of “assisted witness” in the investigation.
The Company is cooperating with French judicial authorities pursuant to a request for mutual legal assistance made by the governmentof Tunisia in connection with historical aircraft sales.
Following a review of its US regulatory compliance procedures, the Company discovered and subsequently informed relevant US
authorities of its findings concerning certain inaccuracies in filings made with the US Department of State pursuant to Part 130 of the US
International Traffic in Arms Regulations (“ITAR”) (a US export control regulation). The Company is cooperating with the US authorities.
The Company is unable to reasonably estimate the time it may take to resolve the matter or the amount or range of potential loss, penalty
or other government action, if any, that may be incurred in connection with this matter.

25

Airbus SE
Unaudited Condensed IFRS Consolidated Financial Information
for the year ended 31 December 2018

Other Disputes
In May 2013, the Company was notified of a commercial dispute following the decision taken by the Company to cease a partnership forsales support activities in some local markets abroad. The Company believes it has solid grounds to legally object to the alleged breachof a commercial agreement. However, the consequences of this dispute and the outcome of the proceedings cannot be fully assessed at
this stage. The arbitration will not be completed until 2020 at the earliest.
In the course of another commercial dispute, the Company received a statement of claim by the Republic of China (Taiwan) alleging
liability for refunding part of the purchase price of a large contract for the supply of missiles by subsidiary Matra Défense S.A.S., which
the customer claims it was not obliged to pay. An arbitral award was rendered on 12 January 2018 with a principal amount of € 104 million
plus interest and costs against Matra Défense S.A.S. Post-award proceedings are currently underway.

24.

Number of Employees
Airbus80,924
77,16331 December 201831 December 2017 (1)
(1)

25.

Airbus Airbus Defence
Helicopters
and Space
19,74533,002
20,10832,171

Consolidated
Airbus133,671
129,442Previous year figures are restated due to the new segment structure.

Events after the Reporting Date

The Company and its largest A380 operator signed a head of agreement on 11 February 2019 (see “– Note 6: “Revenue and Gross
Margin”).

26