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

Contents
1 Airbus SE Unaudited Condensed Interim IFRS Consolidated Financial Statements ...................................................................... 2
Unaudited Condensed Interim IFRS Consolidated Income Statement ...............................................................................................2
Unaudited Condensed Interim IFRS Consolidated Statement of Comprehensive Income .................................................................3
Unaudited Condensed Interim IFRS Consolidated Statement of Financial Position ...........................................................................4
Unaudited Condensed Interim IFRS Consolidated Statement of Cash Flows ....................................................................................6
Unaudited Condensed Interim IFRS Consolidated Statement of Changes in Equity ..........................................................................7
2 Notes to the Airbus SE Unaudited Condensed Interim IFRS Consolidated Financial Statements.................................................81.

The Company .......................................................................................................................................................................82.

Accounting Policies ...............................................................................................................................................................83.

Acquisitions and Disposals.................................................................................................................................................. 10

4.

Related Party Transactions ................................................................................................................................................. 10

5.

Segment Information ........................................................................................................................................................... 10

6.

Revenue and Gross Margin ................................................................................................................................................ 11

7.

Research and Development Expenses ............................................................................................................................... 128.

Share of Profit from Investments Accounted for under the Equity Method and Other Income from Investments .................. 12

9.

Other Income and Other Expenses ..................................................................................................................................... 12

10.

Total Financial Result.......................................................................................................................................................... 13

11.

Income Taxes ..................................................................................................................................................................... 13

12.

Earnings per Share ............................................................................................................................................................. 13

13.

Intangible Assets and Property, Plant and Equipment ......................................................................................................... 13

14.

Investments Accounted for under the Equity Method........................................................................................................... 13

15.

Other Investments and Other Long-Term Financial Assets ................................................................................................. 14

16.

Inventories .......................................................................................................................................................................... 14

17.

Provisions ........................................................................................................................................................................... 14

18.

Other Financial Assets and Other Financial Liabilities ......................................................................................................... 15

19.

Other Assets and Other Liabilities ....................................................................................................................................... 15

20.

Total Equity ......................................................................................................................................................................... 1621.

Net Cash ............................................................................................................................................................................. 16

22.

Financial Instruments .......................................................................................................................................................... 17

23.

Litigation and Claims ........................................................................................................................................................... 18

24.

Number of Employees......................................................................................................................................................... 20

25.

Events after the Reporting Date .......................................................................................................................................... 20

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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
6

7
9
9

1 January 30 September
2019
46,168(38,985)
7,183
(674)
(1,153)(2,150)247(116)

1 January 30 September
2018
40,421(34,357)
6,064
(622)
(1,093)(2,103)352(78)

1 July 30 September
2019
15,302(12,731)
2,571
(214)
(379)
(727)
115
(53)

1 July 30 September
2018
15,451(12,627)
2,824
(211)
(410)
(700)
42
(35)

76
18
3,431
143
(266)
(110)
(233)
(1,024)
2,174

120
43
2,683
144
(367)
(190)
(413)
(824)
1,446

21
4
1,338
52
(75)
5
(18)
(347)
973

39
14
1,563
57
(168)
1
(110)
(500)
953

2,186
(12)

1,453
(7)

989
(16)

957
(4)

€
2.81
2.80

€
1.88
1.87

€
1.27
1.27

€
1.23
1.23

8
8

10
11

Attributable to:Equity owners of the parent (Net income)Non-controlling interests
Earnings per share
Basic
Diluted12
12

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

2

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

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

Profit for the period
Other comprehensive income

1 January 30 September
2019
2,174

1 January 30 September
2018
1,446

1 July 30 September
2019
973

1 July 30 September
2018
953

(4,323)
161

15
(208)

(1,377)
23

19
(119)

(19)
859

42
(37)

(17)
371

34
(43)

70
(3,982)266

34(1,811)(111)

56(3,696)
48

6
(652)
(44)

4
993
(5,971)(3,797)(10)476(1,610)
(164)

(2)
944
(3,650)(2,677)

(4)
173
(630)
323

(3,730)
(67)

(151)
(13)

(2,621)
(56)

327
(4)

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
Attributable to:Equity owners of the parent
Non-controlling interests

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

3

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 September 201931 December 201813
13

16,583
17,143
3
1,523
4,335
79
1,151
497
6,309
10,93758,56016,726
16,773
3
1,693
3,811
65
1,108
888
4,835
10,66256,56435,604
5,036
419
724
1,919
3,631
1,179
2,225
4,613
55,350391
114,301

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

4

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 September 201931 December 2018

20

779
3,072
3,262
(2,339)
(47)
4,727
12
4,739

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

15,683
8,783
15,72910,917359
1,676
35
53,182

11,571
7,463
15,832
8,009
460
1,318
40
44,6935,714
3,416
13,066
24,742
3,302
4,169
986
683
56,078302
109,562
114,301

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.

5

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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)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
Acquisitions of subsidiaries, joint ventures, businesses and non-controllinginterests (net of cash)
Proceeds from disposals of subsidiaries (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
Change in liability for puttable instruments
Changes in capital and non-controlling interests
Change in treasury shares
Cash provided by (used for) financing activities
Effect of foreign exchange rate changes on cash and cash equivalents
Net (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 September 2019

1 January 30 September 2018

2,186
(12)

1,453
(7)

1,992
347
574

1,684
(7)
357

158
(69)
(76)
(647)
(113)
(8,204)(3,864)

(54)
(228)
(120)
(565)
(1,152)(5,687)(4,326)(1,457)(1,378)

109

171

8
(11)

107
0

(700)

(444)

422
53

353
50

0
(18)
(1,594)

207
(17)
(951)

1,243
(1,280)
243
133
4
343
300
(4,815)
9,428
4,613

(35)
(1,161)0
112(52)(1,136)(5)(6,418)12,021
5,603

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 nine months 2019 include € 15 million and € 3 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.

6

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 September 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 September 2019
(1)
(2)
(3)

Equity attributable
to equity ownersof the parent
13,348(2,616)
10,732
1,453(1,604)(151)

Non-controllinginterests
3
(1)
2
(7)
(6)
(13)

Total Equity
13,351(2,617)
10,734
1,446(1,610)(164)(1,161)
112
57
(6)
(52)
9,531

0
0
0
6
0
(5)

(1,161)
112
57
0
(52)
9,526

9,724
(122)
9,602
2,186
(5,916)(3,730)

(5)
0
(5)
(12)
(55)
(67)

9,719
(122)
9,597
2,174
(5,971)(3,797)(1,280)
133
67
(69)
4
4,727

0
6
0
78
0
12

(1,280)
139
67
9
4
4,739

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.

7

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 29 October
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
September 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 nine-month period ended 30 September 2019, the Company’s accounting policies
and methods 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 Condensed Interim IFRS Consolidated
Financial Statements as of 30 September 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 previous 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.

8

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 leases 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)
330

Finance lease liabilities recognised as at 31 December 2018

1,682

Lease liabilities recognised at 1 January 2019

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.

9

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 the C Series
Aircraft Limited Partnership “CSALP”, newly named Airbus Canada Limited Partnership (“ACLP”). Bombardier Inc. (“Bombardier”) andInvestissement Québec (“IQ”) own together 49.94 % of voting rights and 54.20 % of shares as at 30 September 2019.
The opening balance sheet of ACLP has not been adjusted in 2019 and has been completed on 1 July 2019 in accordance with IFRS 3“Business Combinations” after the one year period.
In 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 September 2019 for an amount of € 122
million ($ 133.3 million). The last tranche is planned for October 2019 for an amount of $ 66.6 million, and has already been cashed-out
in an escrow account as of September 2019.
On 29 March 2019, the Company confirmed the agreement to sell its shares in Alestis Aerospace S.L. to Aciturri Aeronáutica S.L., acompany headquartered in Miranda de Ebro, Spain. The closing of the transaction occurred on 30 July 2019. The Company recogniseda current gain for an amount of € 45 million in Airbus. Assets and liabilities of the disposed company were previously classified as held forsale.
Assets and Disposal Groups Classified as Held for Sale
As of 30 September 2019, the Company accounted for assets and disposal group of assets classified as held for sale in the amountof € 391 million (prior year-end: € 334 million) and for disposal group of liabilities classified as held for sale in the amount of € 302
million (prior year-end: € 432 million), both relating to PFW Aerospace S.L.

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.
10

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

Business segment information for the nine-month period ended 30 September 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

Airbus35,572(467)
35,105

AirbusHelicopters
3,712
(304)
3,408

AirbusDefenceand Space
7,706
(51)
7,655

32,577
18
2,510

1,572
178
1,658

2,316
3,058
2,281

0
0
0

36,465
3,254
6,449

3,405
(1,495)

203
(216)

83
(216)

(260)
(223)

3,431
(2,150)(123)(110)(1,024)
2,174

Airbus30,478(516)
29,962

AirbusHelicopters
3,755
(295)
3,460

AirbusDefence and
Space
7,051
(52)
6,999

Transversal /Eliminations
0
0
0

Consolidated
Airbus41,284(863)
40,421

27,825
11
2,126

1,672
249
1,539

1,907
2,786
2,306

0
0
0

31,404
3,046
5,971

2,238
(1,456)

179
(214)

479
(219)

(213)
(214)

2,683
(2,103)
(223)
(190)
(824)
1,446

Transversal / Consolidated
AirbusEliminations
0
46,9900(822)
046,168Business segment information for the nine-month period ended 30 September 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 € +5,747 million to € 46,168 million (first nine months 2018: € 40,421 million). The increase is mainly driven byhigher aircraft deliveries and a favourable foreign exchange impact at Airbus (€ +5,094 million).
Revenue by geographical areas based on the location of the customer is as follows:
1 January 30 September 201914,264
15,657
8,211
4,273
1,263
2,500
46,168(In € million)

Asia-Pacific
EuropeNorth America
Middle East
Latin America
Other Countries
Total

1 January 30 September 201813,197
11,915
7,498
4,470
947
2,394
40,421

The gross margin increased by € +1,119 million to € 7,183 million compared to € 6,064 million in the first nine months 2018. It mainlyreflects A320 ramp up, progress on the A350 financial performance and a favourable foreign exchange impact at Airbus. The gross marginrate increased from 15.0% to 15.6%.

11

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

In the first nine months 2019, Airbus has delivered 77 A350 XWB aircraft. New order intakes, cancellations, delivery postponements andother contractual agreements to the end of September 2019 have been reflected in the financial statements.
The industrial ramp-up on deliveries is progressing and associated risks continue to be closely monitored in line with the schedule, aircraft
performance and overall cost envelope, as per customer commitments. Despite the progress made, challenges remain with recurring costconvergence as the ramp-up on deliveries 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.
In the first nine months 2019, the Company recorded an additional net charge of € 82 million in EBIT as part of its continuous assessmentof assets recoverability and quarterly review of onerous contract provision assumptions.
During the first nine months 2019, 10 A400M aircraft have been delivered, totalling 84 aircraft as of 30 September 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
reflected 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 regard to engines, and on
cost reductions as per the revised baseline. The year-end 2018 assessment remains unchanged as of 30 September 2019. A technicalupdate during the first nine months 2019 mainly reflecting price escalation resulted in a charge of € 14 million.
Due to the repeatedly prolonged suspension of defence export licenses to Saudi Arabia by the German Government, and theconsequential inability of the Company to execute a customer contract, a € 221 million impairment charge has been recognised mainly
on inventories and a € 112 million financial expense related to hedge ineffectiveness. The Company is engaging with its customer toagree a way forward on this contract. The outcome of these negotiations is presently unclear but could result in significant further financial
impacts.

7.

Research and Development Expenses

Research and development expenses increased by € +47 million to € 2,150 million compared to € 2,103 million in the first nine months
2018. In addition, an amount of € 78 million of development costs has been capitalised, mainly related to Airbus 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 € -69 million to € 94
million compared to € 163 million in the first nine months 2018.

9.

Other Income and Other Expenses

Other income decreased by € -105 million to € 247 million compared to € 352 million in the first nine months 2018, mostly driven by thecapital gain of € 159 million from the sale of Plant Holdings Inc. in 2018.
Other expenses increased by € +38 million to € -116 million compared to € -78 million in the first nine months 2018.

12

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

Total Financial Result

Total financial result improved by € +180 million to € -233 million compared to € -413 million in the first nine months 2018. This is mainly
due to the positive impact from foreign exchange valuation of monetary items. 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 € 1,024 million (first nine months 2018: € -824 million) corresponds to an effective tax rate of 32.0%(first nine months 2018: 36.3%). 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 September 2019
€ 2,186 million
776,697,534€ 2.81

1 January 30 September 2018
€ 1,453 million
774,762,268€ 1.88

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 nine months 2019, the average
price of the Company’s shares exceeded the exercise price of the share-settled Performance Units and therefore 996,543 shares (firstnine months 2018: 728,928 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 nine months 2019, by adding back € 5 million ofinterest expense to the profit for the period attributable to equity owners of the parent (first nine months 2018: € 5 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 September 2019

1 January 30 September 2018

€ 2,191 million
782,717,067€ 2.80€ 1,458 million
780,514,186€ 1.87

Dilution assumes conversion of all potential ordinary shares.

Intangible Assets and Property, Plant and Equipment

Intangible assets decreased by € -143 million to € 16,583 million (prior year-end: € 16,726 million). Intangible assets mainly relate to
goodwill of € 13,025 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 € +370 million to € 17,143 million (prior year-end: € 16,773 million), mainly due to theapplication of IFRS 16 offset by depreciation in the period. Property, plant and equipment includes leased assets where the Company islessor of € 127 million (prior-year end: € 45 million).

14.

Investments Accounted for under the Equity Method

Investments accounted for under the equity method decreased by € -170 million to € 1,523 million (prior year-end: € 1,693 million).
They mainly include the equity investments in ArianeGroup and MBDA.

13

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

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

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

30 September 2019
2,570
1,765
4,335
419
4,754

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 September 2019 include theremaining investment in Dassault Aviation (Airbus share: 9.90%, prior year-end: 9.89%) amounting to € 1,074 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€ 1,781 million as of 30 September 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 € 35,604 million (prior year-end: € 31,891 million) increased by € +3,713 million. This is mainly driven by Airbus (€ +2,923
million), and reflects an increase in work in progress associated with A320 programme ramp-up, and Airbus Helicopters (€ +830 million).

17.

Provisions
30 September 201911,355
10,042
21,397
15,683
5,714(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 September 2019, the further weakening of interest rates in Germany, France, Canada and the UK resulted in a total net increasein pension liability of € 2,356 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 revised its demographic assumptions related to the behaviour of beneficiaries under the German
pension plan. This resulted in a net increase in pension liability of € 1,793 million as of 30 June 2019.
These changes in accounting estimates have been recognised through other comprehensive income.
Other provisions are presented net of programme losses against inventories.

14

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 September 2019
1,010
141
1,151
984
444
491
1,919
3,070

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

30 September 2019
4,226
3,816
2,875
10,917
2,242
577
146
337
3,302
14,21931 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 Unaudited Condensed
Interim Consolidated Financial Statements ended 30 September 2019 is based on the applicable contractual repayment dates.

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 September 2019
383
33
81
497
2,026
679
362
564
3,631
4,128

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

30 September 2019
359
359
1,474
2,695
4,169
4,528

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

15

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the nine-month period ended 30 September 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 September 2019776,367,881
1,728,840
778,096,721(599,537)
777,497,184(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 € 4,727 million (prior year-end:€ 9,724 million) representing a decrease of € -4,997 million. This is due to a decrease in other comprehensive income, principally related
to a change in actuarial gains and losses of € -3,443 million and the mark to market revaluation of the hedge portfolio of € -2,932 million,
and a dividend payment of € -1,280 million (€ 1.65 per share), partly compensated by a net income for the period of € 2,186 million.
The non-controlling interests (“NCI”) from non-wholly owned subsidiaries increased to € 12 million as of 30 September 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 September 2019
4,613
2,225
10,937
17,775(3,416)(8,783)
5,576(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 September 2019 amounted to € 5,576 million (prior year-end: € 13,281 million), with a gross cash position of€ 17,775 million (prior year-end: € 22,207 million).

Cash and Cash Equivalents
Cash and cash equivalents are composed of the following elements:
30 September 2019
1,471
2,471
672
2
4,616
3
4,613

(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.

16

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

Financing Liabilities
30 September 2019
7,155
188
169
1,269
2
8,783
1,677
101
127
252
1,259
3,416
12,199(In € million)

Bonds and commercial papers
Liabilities to financial institutions
Loans
Lease liabilities
Others (1)Total long term financing liabilities
Bonds and commercial papers
Liabilities to financial institutions
Loans
Lease liabilities
Others (1)Total short term financing liabilities
Total
(1)

31 December 2018
6,659
267
229
307
1
7,463
0
86
70
23
1,284
1,463
8,926

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

Long-term financing liabilities, mostly comprising bonds and lease liabilities, increased by € +1,320 million€ 8,783 million (prior year-end: € 7,463 million), mainly due to the application of IFRS 16 (see “– Note 2: Accounting Policies”).

toShort-term financing liabilities increased by € +1,953 million to € 3,416 million (prior year-end: € 1,463 million). The increase in shortterm financing liabilities is mainly related to the issuance of commercial papers and the application of IFRS 16.

22.

Financial Instruments

The following table presents the composition of derivative financial instruments:
30 September 2019
1,010
444
1,454
(4,226)(2,242)(6,468)(5,014)(In € million)

Non-current positive fair values
Current positive fair values
Total positive fair values of derivative financial instruments
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

31 December 2018
1,031
286
1,317
(1,132)(1,623)(2,755)(1,438)The total net fair value of derivatives financial instruments decreased by € -3,576 million to € -5,014 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$ 101.0 billion as at 30 September 2019 (prior year-end: US$ 81.9 billion). The US
dollar spot rate was 1.09 US$/€ and 1.15 US$/€ at 30 September 2019 and at 31 December 2018, respectively. The average US dollar
hedge rate for the hedge portfolio of the Company improved to 1.22 US$/€ as at 30 September 2019 compared to 1.24 US$/€ 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 firstnine months 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 September 2019
Book Value
Fair Value(In € million)

Financing liabilities
Bonds and commercial papers
Liabilities to financial institutions and others(8,832)(1,846)17(9,045)(1,845)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 nine-month period ended 30 September 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)

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

30 September 2019
Level 1
Level 2
Level 3Total

31 December 2018
Level 1 Level 2 Level 3

Total

2,021
0
11,0102,471
15,502

0
1,349
2,152
672
4,173

549
105
0
0
654

2,570
1,454
13,162
3,143
20,3291,778
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
23,938000(6,464)0(6,464)(4)(2,464)(2,468)(6,468)(2,464)(8,932)000(2,729)0(2,729)(26)(2,300)(2,326)(2,755)(2,300)(5,055)

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 nine months 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.
Following a series of interim WTO panel decisions, in May 2018 the WTO held that the EU achieved compliance in respect of the majorityof the subsidies at issue but considered that some remaining obligations required adjustments. The Company and the EU took corrective
actions that are currently being reviewed by a WTO panel. In the meantime, and before the WTO’s review of the corrective measures, theUS requested authority to impose countermeasures worth US$ 11.2 billion per year, commensurate with its estimate of the adverse effects
caused by the EU subsidies. The WTO did not agree with the US estimate and authorised the US to impose US$ 7.5 billion in annual
countermeasures. The United States Trade Representative (“USTR”) imposed tariffs on a range of imports to the US from the EU including
10% on the importation of large civil aircraft from the EU. Those tariffs went into effect on 18 October 2019.
The tariffs could have a material impact on the financial statements, business and operations of the Company. At this stage it is too early
to determine the full extent of any financial impact on the Company. Duties on the importation of Airbus products into the US could resultin (i) increased costs for the aerospace and airline industries as well as other industries that rely on 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 thedelivery of new aircraft or limit the routes upon which new aircraft will be used, (iv) increased costs to consumers, (v) retaliation by the EUwith its own import duties to be applied to US products, and/or (vi) damage to the Company’s business or reputation via negative publicity
adversely affecting the Company’s prospects in the commercial market place.
18

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

Several years of proceedings also identified significant unlawful support to Boeing. In its most recent decision on the matter in March
2019, the WTO found that the steps by the US to address US subsidies to Boeing were inadequate. The WTO Appellate Body also foundthat additional US federal and state programmes, such as the Foreign Sales Corporation (“FSC”) and Washington State tax reductions
constitute illegal subsidies. Consequently, the EU initiated its request for the authorisation of annual countermeasures amounting to up to
US$ 12 billion and published a preliminary list of products from the US on which the EU may take countermeasures, which includes US
aircraft. The actual amount of duties to which the EU may be entitled will be determined at the conclusion of WTO arbitration proceedings.
The imposition of equivalent or greater tariffs 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. Several consultants
and other third parties have initiated commercial litigation and arbitration against the Company seeking relief. The enhancement of its
controls and practices has led to additional commercial litigation and arbitration against the Company and may lead to other civil law orcriminal law consequences in the future, which could have a material impact on the financial statements, however at this stage it is too
early to determine the likelihood or extent of any liability.

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

Other Investigations
The Company is cooperating fully with the authorities in a judicial investigation in France related to Kazakhstan. In this spirit, the Company
asked to be interviewed by the investigating magistrates and has been granted the status of “assisted witness” in the investigation.
The Company is cooperating with French judicial authorities pursuant to a request for mutual legal assistance made by the governmentof Tunisia in connection with historical aircraft sales.
Following a review of its US regulatory compliance procedures, the Company discovered and subsequently informed relevant US
authorities of its findings concerning certain inaccuracies in filings made with the US Department of State pursuant to Part 130 of the US
International Traffic in Arms Regulations (“ITAR”) (a US export control regulation). The Company is cooperating with the US authorities.
19

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

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.
On 17 September 2019, the Company self-reported to German authorities potentially improper advance receipt and communication ofconfidential customer information by employees of Airbus Defence and Space GmbH. The information concerned relates to two future
German government procurement projects in the programme line Communications, Intelligence and Security. The self-disclosure by theCompany follows an ongoing internal review with the support of an external law firm. Both the German Ministry of Defence and the Munich
public prosecutor announced their intention to open an investigation into the matter. The Company will continue to fully cooperate with
relevant authorities. The investigation could have an impact on Airbus Defence and Space GmbH’s ability to participate in future public
procurement projects in Germany and may have other legal consequences.

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
Airbus82,10680,92430 September 201931 December 201825.

Airbus Airbus Defence
Helicopters
and Space
20,01833,854
19,74533,002

Consolidated
Airbus135,978
133,671

Events after the Reporting Date

The United States Trade Representative (“USTR”) imposed tariffs on a range of imports to the US from the EU including 10% on theimportation of large civil aircraft from the EU. Those tariffs went into effect on 18 October 2019 (see “– Note 23: Litigation and Claims”).

20