First half-year 2019 Financial Report2019 Semi-annual report of the Board of Directors ................................................................................................................................................. 2
Airbus SE Unaudited Condensed Interim IFRS Consolidated Financial Information for the six-month period ended 30 June 2019 .................. 4

Appendix: Review report of the independent auditor

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 20192019 Semi-annual report of the Board of Directors
1.

Semi-annual report on activities

Main events in the first half-year of 2019For an overview of the main events that occurred during the first half of 2019 and their impact on the Unaudited Condensed Interim IFRS
Consolidated Financial Information of the Company for the six-month period ended 30 June 2019 (the “Semi-Annual Financial Statements”),
please refer to the press release, which was approved by the Board of Directors on 30 July 2019 and will be issued on 31 July 2019, available
on Airbus’ website www.airbus.com.
For further information and detail regarding the Company’s activities, finances, financing, risk factors and corporate governance, please referto the Company’s website www.airbus.com and the documents posted thereon.

Related party transactions
Please refer to the notes to the Semi-Annual Financial Statements attached hereto (see “– Note 4: Related Party Transactions”).

2.

Risk factors

By systematically integrating Enterprise Risk Management (“ERM”) across the company, the Company is mitigating risk and increasing
opportunity, to support risk taking for value creation and competitiveness. Consequently, the company has made ERM a key management
process, carefully followed by the Board of Directors.
The ERM system plays a key role to:-make the business more robust and predictable,-

support operational decision making,-improve the business results,-

reduce the exposure level to risks,-

ensure Airbus ERM compliance regarding the Dutch Corporate Governance Code.

For a description of the Enterprise Risk Management system, the main risks and uncertainties please refer to the:a.

Airbus SE Report of the Board of Directors 2018 (sections 4.5 and 4.6)
(https://www.airbus.com/content/dam/events/annual-general-meeting/Report-of-the-Board-of-Directors-2018-Airbus-SE.pdf), andb.

Airbus SE Information Document (section “Risk Factors”)(https://www.airbus.com/content/dam/corporate-topics/financial-and-company-information/Airbus-SE-Information-Document2018.pdf)

2

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 20193.

Semi-Annual Financial Statements

The Semi-Annual Financial Statements, including the review report by Ernst & Young Accountants LLP, are attached hereto.

4.

Statement of the Board of Directors

The Board of Directors of Airbus hereby declares that, to the best of its knowledge:
the Semi-Annual Financial Statements for the period ended 30 June 2019 give a true and fair view of the assets, liabilities, financial positionand profits or losses of Airbus and undertakings included in the consolidation taken as a whole; andthis Semi-Annual Board Report (including the press release, which was approved by the Board of Directors on 30 July 2019 and will be issued
on 31 July 2019) gives a true and fair view of the position as per the balance sheet date, and of the development and performance during thefirst half of the 2019 financial year and expected course of events of Airbus and undertakings included in the consolidation taken as a whole.
This Semi-Annual Board Report has paid special attention to investments and circumstances upon which the development of revenues andprofitability is dependent, as these have been described herein.

30 July 2019,
The Board of Directors
Denis Ranque, Chairman
Guillaume Faury, Chief Executive Officer
Victor Chu, Director
Jean-Pierre Clamadieu, Director
Ralph D. Crosby, Director
Lord Paul Drayson, Director
Catherine Guillouard, Director
Hermann-Josef Lamberti, Director
María Amparo Moraleda Martínez, Director
Claudia Nemat, Director
René Obermann, Director
Carlos Tavares, Director

3

Airbus SE
Unaudited Condensed Interim
IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

Contents
1 Airbus SE Unaudited Condensed Interim IFRS Consolidated Financial Statements ..........................................................................5
Unaudited Condensed Interim IFRS Consolidated Income Statement ....................................................................................................5
Unaudited Condensed Interim IFRS Consolidated Statement of Comprehensive Income .....................................................................6
Unaudited Condensed Interim IFRS Consolidated Statement of Financial Position ...............................................................................7
Unaudited Condensed Interim IFRS Consolidated Statement of Cash Flows .........................................................................................9
Unaudited Condensed Interim IFRS Consolidated Statement of Changes in Equity ............................................................................10
2 Notes to the Airbus SE Unaudited Condensed Interim IFRS Consolidated Financial Statements .................................................11
1.

The Company...............................................................................................................................................................................112.

Accounting Policies ......................................................................................................................................................................113.

Acquisitions and Disposals ..........................................................................................................................................................13

4.

Related Party Transactions .........................................................................................................................................................13

5.

Segment Information....................................................................................................................................................................13

6.

Revenue and Gross Margin .........................................................................................................................................................14

7.

Research and Development Expenses .......................................................................................................................................15

8.

Share of Profit from Investments Accounted for under the Equity Method and Other Income from Investments ...................15

9.

Other Income and Other Expenses .............................................................................................................................................15

10.

Total Financial Result ..................................................................................................................................................................16

11.

Income Taxes...............................................................................................................................................................................16

12.

Earnings per Share ......................................................................................................................................................................16

13.

Intangible Assets and Property, Plant and Equipment ...............................................................................................................16

14.

Investments Accounted for under the Equity Method .................................................................................................................16

15.

Other Investments and Other Long-Term Financial Assets .......................................................................................................17

16.

Inventories ....................................................................................................................................................................................17

17.

Provisions .....................................................................................................................................................................................17

18.

Other Financial Assets and Other Financial Liabilities ...............................................................................................................18

19.

Other Assets and Other Liabilities ...............................................................................................................................................18

20.

Total Equity ..................................................................................................................................................................................19

21.

Net Cash ......................................................................................................................................................................................19

22.

Financial Instruments ...................................................................................................................................................................20

23.

Litigation and Claims....................................................................................................................................................................21

24.

Number of Employees .................................................................................................................................................................23

25.

Events after the Reporting Date ..................................................................................................................................................23

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 20191
Airbus SE
Unaudited Condensed Interim
IFRS Consolidated Financial Statements
Unaudited Condensed Interim
IFRS Consolidated Income Statement(In € million)

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

Note
6

1 January 30 June 2019
30,866

1 January 30 June 2018
24,9701 April 30 June 201918,317

1 April 30 June 2018
14,851(26,254)
4,612
(460)
(774)
(1,423)
132(63)(21,730)
3,240
(411)
(683)
(1,403)310(43)(15,085)
3,232
(248)
(402)
(769)
62
(42)

(12,685)
2,166
(226)
(326)
(787)
54
(34)

55
14
2,093
91
(191)
(115)
(215)
(677)
1,201

81
29
1,120
87
(199)
(191)
(303)
(324)
493

63
16
1,912
35
(99)
(108)
(172)
(583)
1,157

50
24
921
46
(95)
(293)
(342)
(370)
209

1,197
4

496
(3)

1,157
0

213
(4)

6

7
9
9
8
8

10
11

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

12
12

€

€

€

€

1.54
1.53

0.64
0.64

1.49
1.48

0.27
0.27

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

5

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

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

Profit for the period
Other comprehensive income

1 January 30 June 2019
1,201

1 January 30 June 2018493

1 April 30 June 2019
1,157

1 April 30 June 2018
209

(2,946)
138

(4)
(89)

(2,327)
64

257
(39)

(2)
488

8
6

(4)
313

2
(60)

Items that will not be reclassified to profit or loss:
Remeasurement of the defined benefit pension plans
Change in fair value of financial assets
Share of change from investments accounted for underthe equity method
Income tax relating to items that will not be reclassified
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
Share of change from investments accounted for underthe equity method
Income tax relating to items that may be reclassified
Other comprehensive income, net of tax
Total comprehensive income for the period

14
(286)
218

28
(1,159)
(67)

(39)
442
91

136
(3,153)(23)

649(2,321)(1,120)

(6)
303
(980)
(487)

(6)
(122)
(1,588)
(431)

0
850
(2,030)(1,821)Attributable to:Equity owners of the parent
Non-controlling interests(1,109)
(11)

(478)
(9)

(430)
(1)

(1,806)(15)

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

6

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

Unaudited Condensed Interim
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
Other investments and other long-term financial assets
Non-current contract assets
Non-current other financial assets
Non-current other assets
Deferred tax assets
Non-current securities
Total non-current assets

Note

30 June 201931 December 201813
13

16,607
17,274
3
1,524
4,172
71
963
556
5,006
10,72056,896

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

34,776
5,871
420
752
1,400
3,901
981
1,911
5,218
55,230330
112,456

31,891
6,078
489
789
1,811
4,246
1,451
2,132
9,413
58,300334
115,198

14
15
18
19
21

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

16
15
18
19
21
21
3

7

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019(In € million)

Equity and liabilities
Equity attributable to equity owners of the parent
Capital stock
Share premium
Retained earnings
Accumulated other comprehensive income
Treasury shares
Total equity attributable to equity owners of the parent
Non-controlling interests
Total equity

Liabilities
Non-current liabilities
Non-current provisions
Long-term financing liabilities
Non-current contract liabilities
Non-current other financial liabilities
Non-current other liabilities
Deferred tax liabilities
Non-current deferred income
Total non-current liabilities

Note

30 June 201931 December 2018

20

779
3,072
3,377
253
(47)
7,434
(2)
7,432

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

14,465
8,635
15,551
8,151
398
1,288
44
48,532

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

5,998
2,649
13,06926,141
2,153
4,504
966
699
56,179313
105,024
112,456

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

17
21
18
19

Current liabilities
Current provisions
Short-term financing liabilities
Trade liabilities
Current contract liabilities
Current other financial liabilities
Current other liabilities
Current tax liabilities
Current deferred income
Total current liabilities
Disposal group of liabilities classified as held for sale
Total liabilities
Total equity and liabilities

17
21

18
19

3

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

8

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

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

Operating activities:
Profit for the period attributable to equity owners of the parent (Net income)
Income (Loss) for the period attributable to non-controlling interests
Adjustments to reconcile profit for the period to cash provided by operating
activities:
Depreciation and amortisation
Valuation adjustments
Deferred tax expense (income)Change in income tax assets, income tax liabilities and provisions for income
tax
Results on disposals of non-current assets
Results of investments accounted for under the equity method
Change in current and non-current provisions
Contribution to plan assets
Change in other operating assets and liabilities
Cash (used for) operating activities (1)Investing activities:
Purchases of intangible assets, property, plant and equipment andinvestment property
Proceeds from disposals of intangible assets, property, plant and equipment andinvestment property
Acquisition of subsidiaries, joint ventures, businesses and non-controllinginterests (net of cash)
Payments for investments accounted for under the equity method, otherinvestments and other long-term financial assets
Proceeds from disposals of investments accounted for under the equity method,other investments 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 forsale and liabilities directly associatedChange in securities
Cash (used for) investing activities
Financing activities:
Change in financing liabilities
Cash distribution to Airbus SE shareholders
Changes in liability for puttable instruments
Changes in capital and non-controlling interests
Change in treasury shares
Cash (used for) financing activities
Effect of foreign exchange rate changes on cash and cash equivalents
Net (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period (2)Cash and cash equivalents at end of period (2)(1)(2)

1 January 30 June 2019

1 January 30 June 2018

1,197
4

496
(3)

1,262
117
326

1,162
99
468

330
(50)
(55)
(375)
(77)
(6,088)(3,409)

(403)
(216)
(81)
(385)
(126)
(4,501)(3,490)

(914)

(916)

91

158

8

0

(401)

(238)

258
48

220
0

0
399
(511)

207
11
(558)

644
(1,280)
179
133
4
(320)
52
(4,188)
9,428
5,240

(1,580)(1,161)0
112(52)(2,681)(154)(6,883)
12,021
5,138

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 cash and cash equivalents at the beginning of the period 2019 and at the end of the first half-year 2019 include € 15 million and € 22 million
respectively, which is presented as part of assets of disposal groups classified as held for sale.

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

9

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

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

Balance at 1 January 2018, as reported
Restatements (1)Balance at 1 January 2018, restated (1) (2)Profit for the period
Other comprehensive income
Total comprehensive income for the period
Cash distribution to shareholders /dividends to non-controlling interests
Capital increase
Share-based payment (IFRS 2)
Equity transaction (IAS 27)
Change in treasury shares
Balance at 30 June 2018
Balance at 1 January 2019, as reported
Restatements (3)Balance at 1 January 2019, restated (3)Profit for the period
Other comprehensive income
Total comprehensive income for the period
Cash distribution to shareholders /dividends to non-controlling interests
Capital increase
Share-based payment (IFRS 2)
Equity transaction (IAS 27)
Change in treasury shares
Balance at 30 June 2019
(1)
(2)
(3)

Equity attributable toequity owners of theparent13,348(2,616)
10,732
496
(974)
(478)

Non-controllinginterests
3
(1)
2
(3)
(6)
(9)

Total Equity
13,351(2,617)
10,734
493
(980)
(487)

(1,161)
112
52
(6)
(52)
9,199

0
0
0
(1)
0
(8)

(1,161)
112
52
(7)
(52)
9,191

9,724
(122)
9,602
1,197
(2,306)(1,109)

(5)
0
(5)
4
(15)
(11)

9,719
(122)
9,597
1,201
(2,321)(1,120)(1,280)
133
60
24
4
7,434

0
0
0
14
0
(2)

(1,280)
133
60
38
4
7,432

Previous year figures are restated due to the application of IFRS 15.
Opening balance figures are restated due to the application of IFRS 9.
Opening balance figures are restated due to the application of IFRIC 23.

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

10

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 20192
Notes to the Airbus SE
Unaudited Condensed Interim
IFRS Consolidated Financial Statements
1.

The Company

The accompanying Unaudited Condensed Interim IFRS Consolidated Financial Statements present the financial position and the resultsof operations of Airbus SE together with its subsidiaries referred to as “the Company”, a European public limited-liability company(Societas Europaea) with its seat (statutaire zetel) 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 30 July
2019.

2.

Accounting Policies

The Unaudited Condensed Interim 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 30
June 2019. 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.
These unaudited Condensed Interim IFRS Consolidated Financial Statements are prepared in compliance with IAS 34 and should beread in conjunction with the IFRS Consolidated Financial Statements as of 31 December 2018. With the exception of the changes
highlighted below and applied for the first time in the six-month period ended 30 June 2019, the Company’s accounting policies andmethods are unchanged compared to 31 December 2018.
The Company has implemented the new standard IFRS 16 “Leases” and the new interpretation IFRIC 23 ”Uncertainty over Income Tax
Treatments“ on 1 January 2019. As a result, the Company has changed its accounting policy for leases accounting and for classificationand measurement of certain liabilities linked to uncertainty over income tax as detailed below.
The implementation of other amended standards has no material impact on the Unaudited Interim Condensed IFRS Consolidated
Financial Statements as of 30 June 2019.

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 recognise 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 and hence lessors will continue to classify their leases as operating leases or finance leases.
The Company adopted the new standard IFRS 16 on 1 January 2019 using the modified retrospective method and therefore the cumulative
effect of adopting IFRS 16 has been recognised as an adjustment to the opening balance of retained earnings which is nil at 1 January
2019, with no restatement of comparative information.
Identifying a lease
Under IFRS 16, the Company assesses whether a contract is or contains a lease based on the definition of a lease. A contract is, or
contains a lease if the contract conveys the right to control the use of an identified asset for a specified period of time in exchange forconsideration.

11

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

On transition to IFRS 16, the Company elected to apply the practical expedient to grandfather the assessment of which transactions areleases. The previous determination pursuant to IAS 17 and IFRIC 4 of whether a contract is a lease is thus maintained for existing
contracts.
The Company as a lessee
As a lessee, the Company previously classified leases as operating or finance leases based on assessment of whether the risks andrewards incidental to ownership of the underlying asset were transferred. Under IFRS 16, the Company recognises right-of-use assets
and lease liabilities for most of its leases. Leases which were classified as operating lessees under IAS 17 are now recognised on thebalance sheet.
When applying IFRS 16 for the first time, the Company has used the following practical expedients for leases previously classified as
operating leases under IAS 17:-

To apply a single discount rate to a portfolio of leases with reasonably similar characteristics,-

The right-of-use to the leased asset has generally been measured at the amount of the lease liability, using the discount rate at
1 January 2019. Where accrued lease liabilities existed, the right-of-use asset has been adjusted by the amount of the accrued
lease liability under IFRS 16. At initial application of IFRS 16, the measurement of the right-of-use does not include initial direct
costs. In some cases, the value of right-of-use assets may differ from the value of the liabilities 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 newstandard is effective.

The Company’s operating leases mainly relate to real estate assets, company cars and equipment. The most significant impact identified
by the Company relates to its operating leases of real estate assets (such as land, warehouses, storage facilities and offices).
For leases that were classified as finance leases under IAS 17, the Company did not change the carrying amount of the right-of-use asset
and the lease liability as of 31 December 2018, measured under IAS 17.
The Company as a lessor
The Company is not required to make any adjustments on transition to IFRS 16 for leases in which it acts as a lessor as IFRS 16 does
not trigger any change on current accounting treatment.
Impacts on financial statements
The Company has presented right-of-use assets within “Property, plant and equipment” and lease liabilities within “Financing liabilities”
and classified the principal portion of lease payments within financing activities and the interest portion within operating activities. Whenmeasuring lease liabilities, the Company discounts lease payments using its incremental borrowing rate at 1 January 2019. The weightedaverage rate applied is 1.23%. At 1 January 2019, the impact of renewal options that are reasonably certain to be exercised has beenassessed as not significant for the Company.

(In € million)
Operating lease commitment at 31 December 2018 as disclosed in the
Company’s consolidated financial statements

1 January 2019
1,494

Short-term and low-value leases recognised on a straight-line basis as expenses(29)

Discounted effect using the incremental borrowing rate at 1 January 2019(113)

Finance lease liabilities recognised as at 31 December 2018330

Lease liabilities recognised at 1 January 2019

1,682

IFRIC 23 “Uncertainty over Income Tax Treatments”
In 2017, the IASB issued IFRIC 23 “Uncertainty over Income Tax Treatments”. The interpretation clarifies the recognition andmeasurement requirements when there is uncertainty over income tax treatments. In assessing the uncertainty, an entity shall consider
whether it is probable that a taxation authority will accept the uncertain tax treatment.
The Company adopted the interpretation on 1 January 2019 and has elected to apply the limited exemption in IFRIC 23 relating to transition
for classification and measurement, and accordingly has not restated comparative periods in the year of initial application. As aconsequence, any adjustments to the carrying amounts of tax liabilities are recognised at the beginning of the reporting period, with thedifference recognised in opening equity. The impact is € 122 million as at transition date.
In addition, the uncertain tax liabilities formerly included under provisions have been reclassified to current income tax liabilities for € 326
million.

12

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

Use of Estimates and Judgements
In preparing the Unaudited Condensed Interim IFRS Consolidated Financial Statements, management makes assumptions and estimates.
These estimates are revised if the underlying circumstances have evolved or in light of new information. 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 2018.
The exceptions are:3.

-

the estimate of income tax liabilities which is determined in the interim financial statements using the estimated average annual
effective income tax rate applied to the pre-tax income of the interim period; and-estimates used to perform employee benefits valuation (see “– Note 17: Provisions”).

Acquisitions and Disposals

Acquisitions and Disposals
On 1 July 2018, Airbus has taken the control of C Series programme and acquired 50.01% Class A ownership units in to the C Series
Aircraft Limited Partnership “CSALP”, newly named Airbus Canada Limited Partnership (“ACLP”). Bombardier Inc. (“Bombardier”) andInvestissement Québec (“IQ”) own 33.55 % and 16.44 % respectively as at 30 June 2019.
The opening balance sheet of ACLP has not been adjusted in the first half year 2019 and has been completed on 1 July 2019 In
accordance with IFRS 3 “Business Combinations” after the one year period.
On March 2019, the Company has become party to a Note Purchase Agreement with OneWeb Communications for an amount of $ 200
million. The new financing is funded in three equal tranches, of which two have been drawn as of June 2019 for an amount of € 122 million($ 133.3 million). The last tranche is planned for the fourth quarter 2019 for a remaining amount of $ 66.6 million.
Assets and Disposal Groups Classified as Held for Sale
As of 30 June 2019, the Company accounted for assets and disposal group of assets classified as held for sale in the amount of€ 330 million (prior year-end: € 334 million). Disposal group of liabilities classified as held for sale as of 30 June 2019 amount to € 313
million (prior year-end: € 432 million), and relate to Alestis Areospace S.L. On 29 March 2019, the Company confirmed the agreement tosell its shares in Alestis Aerospace to Aciturri, a company headquartered in Miranda de Ebro, Spain. The closing of the transaction is
subject to certain conditions' precedent that should be completed in the short term.

4.

Related Party Transactions

The Company has entered into various transactions with related entities; carried out in the normal course of business.

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 — Development, manufacturing, marketing and sale of commercial jet aircraft of more than 100 seats; aircraft conversion
and related services; development, manufacturing, marketing and sale of regional 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 and their associated services. Space Systems design, development, delivery, and support offull range of civil and defence space systems for telecommunications, earth observations, navigation, science and orbital systems.
Communication, Intelligence and Security provision of services around data processing from platforms, secure communication andcyber security. In addition, the main joint ventures design, develop, deliver, and support missile systems as well as space launcher
systems. Unmanned Aerial Systems design, development, delivery and service support.

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.

13

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

Business segment information for the six-month period ended 30 June 2019 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

Airbus24,043(321)
23,722

AirbusHelicopters
2,371
(209)
2,162

AirbusDefenceand Space
5,015
(33)
4,982

22,031
14
1,677

944
128
1,090

1,448
2,068
1,466

0
0
0

24,423
2,210
4,233

2,151
(1,008)

124
(143)

(15)
(138)

(167)
(134)

2,093
(1,423)
(100)
(115)
(677)
1,201

Airbus18,546(379)
18,167

AirbusHelicopters
2,388
(199)
2,189

AirbusDefence and
Space
4,652
(38)
4,614

Transversal /Eliminations
0
0
0

Consolidated
Airbus
25,586(616)
24,97016,749
9
1,409

973
216
1,000

1,251
1,879
1,484

0
0
0

18,973
2,104
3,893

773
(975)

114
(147)

382
(136)

(149)
(145)

1,120
(1,403)
(112)
(191)
(324)
493

Transversal / Consolidated
AirbusEliminations
0
31,4290(563)
030,866

Business segment information for the six-month period ended 30 June 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

6.

Revenue and Gross Margin

Revenue increased by € +5,896 million to € 30,866 million (first half-year 2018: € 24,970 million). The increase is mainly driven by higher
aircraft deliveries and a favourable foreign exchange impact at Airbus (€ +5,497 million).
Revenue by geographical areas based on the location of the customer is as follows:
1 January 30 June 2019
9,699
10,811
5,583
2,723
789
1,261
30,866(In € million)

EuropeAsia-PacificNorth America
Middle East
Latin America
Other countries
Total

1 January 30 June 2018
8,001
6,748
5,167
2,896
546
1,612
24,970

The gross margin increased by € +1,372 million to € 4,612 million compared to € 3,240 million in the first half-year 2018. It mainly reflects
A320 ramp-up, improved performance and a favourable foreign exchange impact at Airbus. The gross margin rate increased from 13.0%
to 14.9%.

14

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

In the first half-year 2019, Airbus has delivered 53 A350 XWB aircraft. New order intakes, cancellations, delivery postponements andother contractual agreements to the end of June 2019 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.
As of 31 December 2018, the Company’s largest A380 operator reviewed its aircraft fleet strategy going forward and concluded it is forced
to restructure 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 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 impaired specific A380 assets inthe amount of € 167 million, recognised an onerous contract provision for an amount of € 1,257 million and updated the measurement ofrefundable 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 affected the consolidated income statement
before taxes by a net € 463 million in EBIT and positively impacted the other financial result by € 177 million as of 31 December 2018.
As of 30 June 2019, the Company recorded an additional net charge of € 82 million in EBIT as part of its continuous assessment of assets
recoverability and quarterly review of onerous contract provision assumptions.
During the first half-year 2019, 7 A400M aircraft has been delivered, totalling 81 aircraft as of 30 June 2019. 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 2018, the Company has been working together with OCCAR and concluded the negotiations on a contract amendment following thesignature of a Declaration of Intent (“DOI”) in February 2018 agreeing on a Global re-baselining of the contract.
On 13 June 2019, the Global re-baselining contract has been signed by the parties.
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 the launch contract phase of the A400M
programme as well as applicable escalation and some cost increases. Risks remain on development of technical capabilities and theassociated costs, on securing sufficient export orders in time, on aircraft operational reliability in particular with regards to engines, andon cost reductions as per the revised baseline. The year-end 2018 assessment remains unchanged as of 30 June 2019. A technicalupdate during the first half-year 2019 mainly reflecting price escalation resulted in a charge of € 14 million.
Due to the prolonged suspension of defence export licenses to Saudi Arabia by the German Government, and the consequential inabilityof the Company to execute a customer contract, a € 208 million impairment charge has been recognised mainly on inventories and a€ 107 million financial expense related to hedge ineffectiveness. The Company is engaging with its customer to agree a way forward on
this contract. The outcome of these negotiations is presently unclear but could result in significant further financial risks.

7.

Research and Development Expenses

Research and development expenses increased by € +20 million to € 1,423 million compared to € 1,403 million in the first half-year2018. In addition, an amount of € 45 million of development costs has been capitalised, mainly related to Airbus Defence and Space
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 decreased by € -41 million to € 69
million compared to € 110 million in the first half-year 2018.

9.

Other Income and Other Expenses

Other income decreased by € -178 million to € 132 million compared to € 310 million in the first half-year 2018, mostly driven by thecapital gain of € 159 million from the sale of Plant Holdings Inc. in 2018.
Other expenses increased by € +20 million to € -63 million compared to € -43 million in the first half-year 2018.

15

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 201910.

Total Financial Result

Total financial result improved by € +88 million to € -215 million compared to € -303 million in the first half-year 2018. This is mainly due
to the positive impact from foreign exchange valuation of monetary items, partly offset by the revaluation of certain equity instruments
under IFRS 9. The financial result includes the financial expense on hedge ineffectiveness (see “– Note 6: Revenue and Gross Margin”).

11.

Income Taxes

The income tax expense of € -677 million (first half-year 2018: € -324 million) corresponds to an effective tax rate of 36.0%(first half-year 2018: 39.7%). This includes a deferred tax asset impairment, partially offset by the tax-free revaluation of certain equity
investments under IFRS 9.

12.

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

1 January 30 June 2019
€ 1,197 million
776,291,117€ 1.54

1 January 30 June 2018
€ 496 million
774,129,413€ 0.64

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 the first half-year 2019, the average
price of the Company’s shares exceeded the exercise price of the share-settled Performance Units and therefore 921,803 shares (firsthalf-year 2018: 672,955 shares) were considered in the calculation of diluted earnings per share. The dilutive effect of the convertible
bond was also considered in the calculation of diluted earnings per share in the first half-year 2019, by adding back € 3 million of interest
expense to the profit for the period attributable to equity owners of the parent (first half-year 2018: € 3 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
Weighted average number of ordinary shares (diluted) (1)Diluted earnings per share
(1)

13.

1 January 30 June 2019

1 January 30 June 2018

€ 1,200 million
782,235,910€ 1.53€ 499 million
779,825,358€ 0.64

Dilution assumes conversion of all potential ordinary shares.

Intangible Assets and Property, Plant and Equipment

Intangible assets decreased by € -119 million to € 16,607 million (prior year-end: € 16,726 million). Intangible assets mainly relate to
goodwill of € 13,041 million (prior year-end: € 13,039 million).
The annual impairment tests were performed in the fourth quarter 2018 and led to no impairment charge.
Property, plant and equipment increased by € +501 million to € 17,274 million (prior year-end: € 16,773 million), mainly due to theapplication of IFRS 16. Property, plant and equipment includes leased assets of € 129 million (prior-year end: € 45 million).

14.

Investments Accounted for under the Equity Method

Investments accounted for under the equity method decreased by € -169 million to € 1,524 million (prior year-end: € 1,693 million) andmainly include the equity investments in ArianeGroup and MBDA.

16

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 201915.

Other Investments and Other Long-Term Financial Assets
30 June 2019(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

2,449
1,723
4,172
420
4,592

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

Other investments mainly comprise the Company’s participations. The significant participations at 30 June 2019 include the remaining
investment in Dassault Aviation (Airbus share: 9.90%, prior year-end: 9.89%) amounting to € 1,046 million (prior year-end: € 999 million).
Other long-term financial assets and the current portion of other long-term financial assets include other loans in the amount of€ 1,737 million as of 30 June 2019 (prior year-end: € 1,523 million), and the sales financing activities in the form of finance leasereceivables and loans from aircraft financing.

16.

Inventories

Inventories of € 34,776 million (prior year-end: € 31,891 million) increased by € +2,885 million. This is mainly driven by Airbus (€ +2,212
million), and reflects an increase in work in progress associated with A320 programme ramp-up, and Airbus Helicopters (€ +700 million).

17.

Provisions
30 June 2019
10,075
10,38820,463
14,465
5,998(In € million)

Provisions for pensions
Other provisions
Total
thereof non-current portion
thereof current portion

31 December 2018
7,072
11,816
18,888
11,571
7,317

Provisions for pensions
As of 30 June 2019, the further weakening of interest rates in Germany, France, Canada and the UK resulted in a total net increase inpension liability of € 1,104 million.
In light of the prolonged decline in interest rates and without any sign of change in this trend in a foreseeable future coupled with experience
gained over recent years, management has revised its demographic assumptions related to the behaviour of beneficiaries under theGerman pension plan. This resulted in a net increase in pension liability of € 1,793 million.
These changes in accounting estimates have been recognised through other comprehensive income.
Other provisions are presented net of programme losses against inventories.
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.
Included in other provisions is an estimate of the related net future costs related to the H225 Super Puma accident in 2016.

17

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 201918.

Other Financial Assets and Other Financial Liabilities

Other Financial Assets(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

30 June 2019
884
79
963
809
160
431
1,400
2,363

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

30 June 2019
1,729
3,658
2,764
8,151
769
886
156
342
2,153
10,30431 December 2018
1,132
4,233
2,644
8,009
1,623
344
175
320
2,462
10,471Other Financial Liabilities(In € million)

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

The allocation of European Governments’ refundable advances between non-current and current presented in the Financial Statements
ended 31 March 2019 has been updated as at 30 June 2019 based on the applicable contractual repayment dates. Consequently, there
is a reallocation from current to non-current in the period. The total amount of European Governments’ refundable advances is unaffected.

19.

Other Assets and Other Liabilities

Other Assets(In € million)

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

30 June 2019
463
28
65
556
2,237
667
399
598
3,901
4,457

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

30 June 2019
398
398
1,729
2,775
4,504
4,902

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

Other Liabilities(In € million)

OthersTotal non-current other liabilities
Tax liabilities (excluding income tax)
OthersTotal current other liabilities
Total
18

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 201920.

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:
30 June 2019776,367,881
1,728,840
778,096,721(599,799)
777,496,922(In number of shares)

Issued as at 1 January
Issued for ESOP
Issued at end of period
Treasury shares
Outstanding at end of period

31 December 2018774,556,062
1,811,819
776,367,881(636,924)
775,730,957

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 € 7,434 million (prior year-end:€ 9,724 million) representing a decrease of € -2,290 million. This is due to a dividend payment of € -1,280 million (€ 1.65 per share), anda decrease in other comprehensive income, principally related to a change in actuarial gains and losses of € -2,425 million, partly
compensated by a net income for the period of € 1,197 million.
The non-controlling interests (“NCI”) from non-wholly owned subsidiaries increased to € -2 million as of 30 June 2019(prior year-end: € -5 million). These NCI do not have a material interest in the Company’s activities and cash flows.

21.

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.

30 June 2019
5,218
1,911
10,72017,849(2,649)(8,635)
6,565(In € million)

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

31 December 2018
9,413
2,132
10,662
22,207(1,463)(7,463)
13,281

The net cash position on 30 June 2019 amounted to € 6,565 (prior year-end: € 13,281 million), with a gross cash position of€ 17,849 million (prior year-end: € 22,207 million).

Cash and Cash Equivalents
Cash and cash equivalents are composed of the following elements:

30 June 2019
1,805
2,562
872
1
5,240
22
5,218

(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)
OthersTotal cash and cash equivalents
Recognised in disposal groups classified as held for sale
Recognised in cash and cash equivalents

31 December 2018
1,862
6,576
984
6
9,428
15
9,413

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.

19

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

Financing Liabilities
30 June 2019

Bonds and commercial papers
Liabilities to financial institutions
Loans
Finance lease liabilities
Others (1)Total long-term financing liabilities

6,945
216
160
1,314
0
8,635

31 December 2018
6,659
267
229
307
1
7,463

Bonds and commercial papers
Liabilities to financial institutions
Loans
Finance lease liabilities
Others (1)Total short-term financing liabilities
Total

746
101
133
256
1,413
2,649
11,284

0
86
70
23
1,284
1,463
8,926

(In € million)(1)

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

Long-term financing liabilities, mainly comprising bonds and finance lease liabilities, increased by € +1,172 million to€ 8,635 million (prior year-end: € 7,463 million), mainly due to the application of IFRS 16.
Short-term financing liabilities increased by € +1,186 million to € 2,649 million (prior year-end: € 1,463 million). The increase in shortterm financing liabilities is mainly related to the issuance of bonds and the application of IFRS 16.

22.

Financial Instruments

The following table presents the composition of derivative financial instruments:
30 June 2019Non-current positive fair values
Current positive fair values
Total positive fair values of derivative financial instruments

884
160
1,044

31 December 2018
1,031
286
1,317

Non-current negative fair values
Current negative fair values
Total negative fair values of derivative financial instruments
Total net fair values of derivative financial instruments(1,729)(769)(2,498)(1,454)(1,132)(1,623)(2,755)(1,438)(In € million)

The total net fair value of derivative financial instruments decreased by € -16 million to € -1,454 million (prior year-end: € -1,438 million) as
a result of the strengthening of the US dollar versus the euro associated with the mark to market valuation of the hedge portfolio.
The volume of hedged US dollar-contracts was US$ 87.4 billion as at 30 June 2019 (prior year-end: US$ 81.9 billion). The US dollar spot
rate was 1.14 US$/€ and 1.15 US$/€ at 30 June 2019 and at 31 December 2018, respectively. The average US dollar hedge rate for thehedge portfolio of the Company improved to 1.23 US$/€ as at 30 June 2019 compared to 1.24 US$/€ as at 31 December 2018.

Carrying Amounts and Fair Values of Financial Instruments
Fair values of financial instruments have been determined with reference to available market information at the end of the reporting period
and the valuation methodologies as described in detail in Note 35.2 to the 2018 IFRS Consolidated Financial Statements. For the firsthalf-year 2019, the Company has applied the same methodologies for the fair value measurement of financial instruments. In addition,
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 common valuation methods such as net asset values or a comparable company valuation
multiples technique.
Carrying amount is a reasonable approximation of fair value for all classes of financial instruments listed in the first table of Note 35.2 tothe 2018 IFRS Consolidated Financial Statements, with the exception of:
30 June 2019
Book Value
Fair Value(In € million)

Financing liabilities
Bonds and commercial papers
Liabilities to financial institutions and others(7,691)(2,023)20(7,877)(2,025)31 December 2018
Book Value
Fair Value(6,659)(1,937)(6,781)(1,941)

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

Fair Value Hierarchy
Depending on the extent the inputs used to measure fair values rely on observable market data, fair value measurements may behierarchised according to the following levels of input:•

Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities;•

Level 2: inputs other than quoted prices that are observable for the asset or liability – fair values measured based on Level 2
input typically rely on observable market data such as interest rates, foreign exchange rates, credit spreads or volatilities;•

Level 3: inputs for the asset or liability that are not based on observable market data – fair values measured based on Level 3
input rely to a significant extent on estimates derived from the Company’s’ own data and may require the use of assumptions
that are inherently judgemental and involve various limitations.

The fair values disclosed for financial instruments accounted for at amortised cost reflect Level 2 input. Otherwise, fair values are
determined mostly based on Level 1 and Level 2 input and to a minor extent on Level 3 input.
The following table presents the carrying amounts of the financial instruments held at fair value across the three levels of the fair value
hierarchy:(In € million)

30 June 2019
Level 2
Level 1

Financial assets measured at fair value
Equity instruments
Derivative instruments
Securities
Cash equivalents
Total

1,941
0
10,794
2,562
15,29700
0

Financial liabilities measured at fair value
Derivative instruments
Other financial liabilities
Total

31 December 2018
Level 1 Level 2 Level 3

Level 3

Total

0
921
1,837
872
3,630

508
123
0
0
631

2,449
1,044
12,631
3,434
19,5581,778
010,721
6,576
19,075

0
1,152
2,073
984
4,209

489
165
0
0
654

2,267
1,317
12,794
7,560
23,938(2,489)0(2,489)(9)(2,386)(2,395)(2,498)(2,386)(4,884)000(2,729)0(2,729)(26)(2,300)(2,326)(2,755)(2,300)(5,055)Total

The financial liabilities measured at fair value that are classified as Level 3 consist mainly of the written put options on non-controllinginterests resulting from the acquisition of ACLP. There has been no material changes in the valuation of the Level 3 financial instruments
during the first half-year 2019.

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 9 April 2019, the United States
Trade Representative (“USTR”) published for public consultation a preliminary list of products from the EU to which it may seek to apply
duties pursuant to the May 2018 decision, which includes new aircraft and helicopters as well as major components for aircraft21

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

manufacturing in the US. The actual amount of duties to which the US may be entitled will be determined at the conclusion of the Article
22.6 arbitration proceedings in accordance with the WTO rules.
The potential imposition of any import duties (and the amount thereof) or other countermeasures against the EU following the Article 22.6
arbitration proceedings will depend on the USTR, and could have a material impact on the financial statements, business and operationsof the Company. At this stage it is too early to determine the extent of any financial impact on the Company. Duties on the importation of
Airbus products into the US could result in (i) increased costs for the aerospace and airline industries as well as other industries that relyon air transport, (ii) weakening demand for new aircraft and negatively affecting the financial condition of air carriers and lessors, (iii)
decisions to defer, reject or reschedule the delivery of new aircraft or limit the routes upon which new aircraft will be used, (iv) increased
costs to consumers, (v) retaliation by the EU with its own import duties to be applied to US products, and/or (vi) damage to the Company’sbusiness or reputation via negative publicity adversely affecting the Company’s prospects in the commercial market place.
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 wasreferred to the WTO for further review pursuant to WTO rules. The Appellate Body published its decision in March 2019 in which the WTO
rejected the US’s arguments and preserved the EU’s win before the panel. The Appellate Body also found that additional US federal andstate programmes constitute illegal subsidies. Now that the Appellate Body report has been adopted, the EU have requested resumptionof an arbitration concerning the amount of annually-recurring countermeasures it is permitted to take against the importation of US
products. On 17 April 2019, the EU published a public consultation on a preliminary list of products from the US on which the EU may
take countermeasures. The actual amount of duties to which the EU may be entitled will be determined at the conclusion of the Article
22.6 arbitration proceedings. In the event that the US does indeed impose duties on Airbus aircraft, the imposition of equivalent or greatertariffs on aircraft imports into Europe is likely.
Exact timing of further steps in the WTO litigation process is subject to further rulings and to negotiations between the US and the EU.

GPTIn 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.

22

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2019

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 leadto other civil law or criminal law consequences in the future, which could have a material impact on the financial statements, however atthis 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.

Other Disputes
In the course of a commercial dispute, the Company received a statement of claim by the Republic of China (Taiwan) alleging liability forrefunding 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
Airbus82,89280,92430 June 201931 December 201825.

Airbus Airbus Defence
Helicopters
and Space
19,95133,50019,74533,002

Consolidated
Airbus136,343
133,671

Events after the Reporting Date

The transaction with Aciturri Aeronáutica S.L. in relation to Alestis Aeroespace S.L. has been closed pursuant the signature of the final
agreement on 30 July 2019.

23

Review reportTo:the board of directors of Airbus SE

Introduction
We have reviewed the accompanying condensed consolidated interim financial information of
Airbus SE, Amsterdam, which comprises the condensed consolidated statement of financial position as at 30 June 2019, thecondensed consolidated statements of comprehensive income, changes in equity, and cash flows for the six-month period ended 30
June 2019, and the notes, comprising a summary of the significant accounting policies and other explanatory information.
The board of directors is responsible for the preparation and presentation of this condensed consolidated interim financial
information in accordance with IAS 34, “Interim Financial Reporting” as adopted by the European Union. Our responsibility is toexpress a conclusion on this interim financial information based on our review.
Scope
We conducted our review in accordance with Dutch law including standard 2410, “Review of Interim Financial Information
Performed by the Independent Auditor of the Entity”. A review of interim financial information consists of making inquiries, primarilyof persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review issubstantially less in scope than an audit conducted in accordance with Dutch auditing standards and consequently does not enable
us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated
interim financial information for the six-month period ended 30 June 2019 is not prepared, in all material respects, in accordancewith IAS 34, “Interim Financial Reporting”, as adopted by the European Union.

Amsterdam, 30 July 2019

Ernst & Young Accountants LLP

signed by A.A. van Eimeren