EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

First Quarter Report 2003

Condensed Interim Consolidated
Financial Statements of EADS N.V.
for the first quarter of 2003

Consolidated Income Statements........................................................................................ 2
Consolidated Balance Sheets ............................................................................................ 3
Consolidated Cash Flow Statements ................................................................................... 4
Consolidated Statements of Changes in Shareholder’s Equity ................................................... 5
1.
The Company ...................................................................................................... 52.
Accounting policies ............................................................................................... 53.
Changes in the consolidation perimeter and major events of EADS ................................. 64.
Segment information ............................................................................................. 65.
Significant profit and loss statement items .................................................................. 76.
Significant balance sheet items ................................................................................ 87.
Significant cash flow items ...................................................................................... 88.
Contingencies ...................................................................................................... 89.
Number of shares ................................................................................................. 810.
Earnings per share ............................................................................................ 911.
Dividend policy ................................................................................................. 912.
Related party transactions................................................................................... 913.
Number of employees ........................................................................................ 9105.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

Consolidated Income Statements
January 1 - March 31,
2003
100-8119M€
6.408-5.2391.169-549-10

Other income
Amortization of goodwill-528
55-140Loss (income) before financial
result, income taxes andminority interest
Financial result
Income taxes
Minority interest
Net loss-96-14
116-93

Revenues
Cost of sales
Gross margin
Selling, administrative & otherexpenses
Research and development
expenses

Earnings per share from net
incomeBasic
DilutedM€
5.520-4.454
1.066%

January 1 - March 31,
2002%

Deviation

100-82
18M€-888
785-103%

-619

-10

70-11-9
1-3-403112-147-62-2-125-57
731-51-5-2
000-2112-45-96
4-25

2-1-100-208
31
9712-68-186-69-101
300
272-14-15-9

€

€

€

-0,12-0,12-0,03-0,03-0,09-0,09

205.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

Consolidated Balance Sheets
March 31, 2003
M€

December 31, 2002%

M€

Deviation%

M€%

Fixed assets
Intangible assets

9738

20978922-51-1

Property, Plant and Equipment

10.6032210.509

2294

1

Financial Assets

4.881104.875

1060

25.22252

25.17354

49

0Inventories

3.295

7

2.700

6595

22

Trade receivables

3.678

74.1149-436-11

Other receivables and other assets

6.149

13

5.256

11893

17Securities

5.169

114.497

9672

15

Cash and cash equivalents

1.550

3

1.703

4-153-919.84141

18.270

39

1.571

9

Deferred tax assets

3.127

6

2.992

6135

5

Prepaid expenses

895

2965

2-70-749.085101

47.400

101

1.685

4811

2811

200Reserves

9.565

199.658

20-93-1

Accumulated other comprehensive
income

3.210

6

2.452

5758

31

Treasury shares

-156

0-156

000

13.43027

12.76527665

5Minority interests

1.530

31.361

3

169

12Provisions

8.310

17

8.248

1762

1

Financial liabilities

6.181

13

4.976

10

1.205

24

Trade liabilities

5.012

10

5.070

11-58

-1

Other liabilities

9.520

19

10.24622-726-7

20.71342

20.29243421

2Deferred tax liabilities

2.431

52.0144417

21

Deferred income

2.671

62.7206-49-2

Total liabilities andshareholders' equity

49.085100

47.4001001.685

4Current assets

Total assets
Shareholders' equity
Capital Stock

Liabilities

305.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

Consolidated Cash Flow Statements
January 1 - March 31, January 1 - March 31,
2003
2002
M€
Net loss
Loss applicable to minority interest
Depreciation and amortization of fixed assets
Valuation adjustments
Change in provisions
Change in deferred taxes
Results on disposals of fixed assets/businesses and result ofassociates (equity method)
Change in other operating assets and liabilities
Cash provided by operating activities
Investments:- Payments for investments in intangible and fixed assets- Acquisition of subsidiaries (net of cash)- Payments for investments in other financial assets- Increase in equipment of leased assets- Proceeds from disposal of intangible and fixed assets- Proceeds from disposal of subsidiaries- Proceeds from disposal of other financial assets- Proceeds from disposal of leased assets- Increase in finance lease receivables- Decrease in finance lease receivables
Change of securities
Change in cash from changes in consolidation
Cash used for investing activities
Change in financial liabilities
OthersCash (used for) provided by financing activities
Effect of foreign exchange rate changes on cash and cash
equivalents
Change in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Additional securities medium-term

M€
-93
-16
453
5-197
-95

-25
-4
576
-27
-169
-100

-37
102
122-62
498
687

-409
-4-108-104
19381
30
99-160-661
1.080
01.080-419
0-426-881263214
0-97
155-231-7-824-150
2-148-7534-2-287

5.401
5.935
784

7.481
7.194
783

Cash used for investing activities in the first quarter 2003 does include investment in securities of 9 M€ (First quarter 2002: -231 M €); these medium-term securities are included in Cash and securities asstated in the balance sheet.

405.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

Consolidated Statements of Changes in Shareholder’s Equity
M€
Equity as of January 1, 2003

12.765

Net income-93

OCI758Equity as of March 31, 2003

13.430Equity as of January 1, 2002

9.877

Net income-25

OCI-162

Equity as of March 31, 2002

9.690

Notes to the Interim Consolidated Financial Statements (IFRS) as at March 31, 2003
1. The Company
The accompanying Condensed Interim Consolidated Financial Statements (unaudited) present theoperations of European Aeronautic Defence and Space Company EADS N.V. and its subsidiaries(“EADS” or the “Group”), a Dutch public limited liability company (naamloze vennootschap) legallyseated in Amsterdam (Le Carré, Beechavenue 130-132, 1119 PR, Schiphol-Rijk, TheNetherlands), and are prepared and reported in Euros (“€”). EADS’ core business is themanufacturing of commercial aircraft, civil helicopters, commercial space launch vehicles, missiles,military aircraft, satellites and defence electronics and rendering of services related to theseactivities.
2. Accounting policies
The Condensed Interim Consolidated Financial Statements have been prepared in accordancewith IAS 34 Interim Financial Reporting. The accounting policies used in the preparation of theinterim consolidated financial statements are consistent with those used in the annual
Consolidated Financial Statements for the year ended December 31, 2002, which are disclosed as
an integral part of the Group’s annual report 2002. The annual Consolidated Financial Statements
were authorised for issue by EADS’ Board of Directors on March 7, 2003. Except for the noncapitalization of R&D costs, EADS is following International Financial Reporting Standards (IFRS)
principles.
Costs that incur unevenly during the financial year are anticipated or deferred in the interim period
only if it is appropriate to anticipate or defer that type of cost at the end of the financial year.
Income tax expense is recognized based on the best estimate of the weighted-average annual
income tax rate expected for the full year. The estimated annual average tax rate pre goodwill
amortization for 2003 is 41 % (2002: 41 %).
These Condensed Interim Consolidated Financial Statements should be read in conjunction withthe annual Consolidated Financial Statements 2002.

505.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

3. Changes in the consolidation perimeter and major events of EADSEADS acquired BAES’ 25 percent interest (27,5 percent economic share) in Astrium N.V. Thetransaction was signed on January 30, 2003 and is accounted for under the purchase method.
Control of Astrium N.V. as well as of Paradigm Secure Communications Ltd., formerly held jointly
by BAES and EADS, has been transferred to EADS at this date.
At completion of the transaction, EADS acquired BAES’ share in Astrium N.V. for 84 M €. Prior tocompletion, EADS and BAES each made a capital contribution into Astrium N.V. of 84 M € (total168 M €). Taking into account the cash contribution, BAES’ interest has been effectivelytransferred to EADS for no net cash consideration.
Apart from this, there were no material acquisitions or disposals of subsidiaries, businesscombinations, long-term investments and discontinued operations during the first quarter 2003.
4. Segment information
The Group operates in 5 divisions (segments) which reflect the internal organisational andmanagement structure according to the nature of the products and services provided:• Airbus — Development, manufacturing, marketing and sale of commercial jet aircraft of morethan 100 seats.
• Military Transport — Development, manufacturing, marketing and sale of light and medium
military transport aircraft and special mission aircraft.
• Aeronautics — Development, manufacturing, marketing and sale of civil and military helicopters,
military combat and trainer aircraft, regional turboprop aircraft and light commercial aircraft; andcivil and military aircraft conversion and maintenance services.
• Defence and Civil systems — Development, manufacturing, marketing and sale of missiles
systems; and provision of defence electronics, military and commercial telecommunications
solutions; and logistics, training, testing, engineering and other related services.
• Space — Development, manufacturing, marketing and sale of satellites, orbital infrastructuresand launchers; and provision of launch services.
The following table presents information with respect to the Group’s business segments.
Consolidation effects, the holding function of EADS headquarters and other activities not allocableto the divisions are disclosed in the column “HQ/ Conso.”.

605.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

in M €Airbus

Military
Transport

Aeronautics

Defenceand CivilSystemsSpace

HQ/ Conso.

ConsolidatedThree months ended March 31, 2003
Revenues

3.775

96969

530

403

-253

5.520

Research and development
costs

445

629

37

110528EBIT pre goodwill amort. andexceptionals (see definitionbelow)

166-1133-72-21

35

130

4.646

101

936

539

426

-240

6.408

Research and development
costs

320

825

39

12-1403

EBIT pre goodwill amort. andexceptionals (see definitionbelow)

396

-12

16-72

-33

20315

Three months ended March 31, 2002
Revenues

EADS uses EBIT pre goodwill amortization and exceptionals as a key indicator to measure theeconomic performance of the Group and its Segments. The term “exceptionals” refers to income
or expenses of a non-recurring nature, such as amortization expenses of fair value adjustments
relating to the EADS merger, as well as impairment charges.
A reconciliation from Result before financial result, income taxes and minority interests to EBIT pre
goodwill amortization and exceptionals is set forth in the following table (in M €):Result before financial result, income taxes and minority interests-96

Income from associates

24-72

Goodwill and exceptionals:
Goodwill amortisation

140

Fair value adjustment

62

EBIT pre goodwill amortization and exceptionals

130

5. Significant profit and loss statement items
Revenues in the first quarter 2003 reached 5.520 M € (first quarter 2002: 6.408 M €). The
decrease mostly reflects lower aircraft deliveries of Airbus and a weaker US-Dollar.
Research and development costs of 528 M € (first quarter 2002: 403 M €) increased mainly
because of the Airbus A 380 project.
Other operating income of 55 M € (first quarter 2002: 112 M €) decreased, as last year it
comprised the gain on the disposal of 50 % of Aircelle by Airbus (63 M €).

705.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

The financial result includes net interest of -18 M €, income from investments of 24 M € and otherfinancial result of -20 M €, partly influenced by foreign currency financial instruments.
6. Significant balance sheet items
Compared to the beginning of the period, fixed assets remained nearly the same.
Goodwill decreased according to the amortization plan. Due to the 100 % consolidation ofAstrium, Goodwill has increased by 83 M €.
Inventories increased mainly due to cyclic business mainly at Eurocopter.
The decrease in trade receivables is mainly due to high customer payments in Defence and Civil
Systems and Aeronautics.
The development of the US-Dollar / € -rate leads to a positive mark-to-market revaluation ofhedges according to IAS 39 and an increase to 3.934 M € as part of other receivables and otherassets.
Provisions include 3.558 M € for retirement plans and similar obligations, 143 M € of provisions
for financial instruments and 4.609 M € of other provisions.
Financial liabilities have increased mainly due to the issuance of a Eurobond loan of 1.000 M €.
Additionally, an amount of 236 M € has been restructured from a risk sharing bank loan to anormal bank loan and was thus reclassified from other liabilities. Also included is a 86 M €decrease resulting from the first time consolidation of 100% of Astrium.
Other liabilities mainly include 4.193 M € of European Governments refundable advances and3.172 M € of customer advance payments.
7. Significant cash flow items
Cash provided by operating activities is still positive but essentially influenced by an increase
in inventories which is offset by a settlement of trade receivables. The reclassification of 236 M €as mentioned above has not been considered in the cash flow statement because of its neutrality
on the balance of Cash and cash equivalents.
Cash used for investing activities mainly comprises an outflow for investments in fixed assets(CAPEX -409 M €) and an increase in aircraft under operating lease of -104 M €. Also included is
the impact on Cash and cash equivalents resulting from the first time 100% consolidation ofAstrium of -160 M €.
Cash used for financing activities has increased by 1.080 M € and contains mainly a new
Eurobond loan of 1 billion € issued on March 3, 2003.
8. Contingencies
Since the last balance sheet date (December 31, 2002), there were no significant changes incontingent liabilities.
9. Number of shares
The total number of shares outstanding is 800.957.248 and 809.168.061 as of March 31, 2003 and2002, respectively. EADS’ shares are exclusively ordinary shares with a par value of 1,00 €.
During the first quarter 2002, EADS repurchased 7.500 ordinary shares in conjunction with the805.05.2003

EADS N.V.
Condensed Interim Consolidated Financial Statements for the three months ending March 31, 2003

share-buyback program as approved by the general meeting in 2001. No shares wererepurchased in the first quarter 2003.
10. Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders by
the weighted average number of issued ordinary shares during the period, excluding ordinary
shares purchased by the Group and held as treasury shares:

Net loss attributable to shareholders
Weighted average number of ordinary shares outstanding
Basic earnings per share

January 1, 2003 toJanuary 1, 2002 to

March 31, 2003

March 31, 2002

-93 M €-25 M €800.957.248

809.175.311-0,12 €-0,03 €For the calculation of the diluted earnings per share, the weighted average number of ordinary
shares is adjusted to assume conversion of all potential ordinary shares. The Group’s only
category of dilutive potential ordinary shares is stock options. Since the exercise price of the stock
options under all existing stock option plans initiated by the Group is exceeding the share price ofEADS shares, to include these potential ordinary shares would be anti-dilutive. As a consequence,
net income as well as the weighted number of ordinary shares in issue is the same for both basic
and diluted earnings per share.
11. Dividend policy
The Group’s Board of Directors will propose at the annual shareholders’ meeting on May 6, 2003,
to pay from distributable reserves 0,30 € per ordinary share for the business year 2002.
12. Related party transactions
The Group has entered into various transactions with related companies in 2003 and 2002 thathave all been carried out in the normal course of business. As is the Group’s policy, all related
party transactions have to be carried out at arm’s length. Transactions with related parties include
the French State, DaimlerChrysler, Lagardère, and SEPI (Spanish State). Except for thetransactions with the French State the transactions are not considered material to the Group either
individually or in the aggregate. The transactions with the French State include mainly sales fromthe Aeronautics, Defence, and Space divisions.
13. Number of employees
The number of employees at March 31, 2003 is 107,263 as compared to 102,917 at March 31,
2002 reflecting Astrium first time 100% consolidation as well as new employments at Airbus toface the A380 program ramp up.

905.05.2003