First half-year 2017 Financial Report2017 Semi-annual report of the Board of Directors ................................................................................................. 2
Unaudited Condensed Interim IFRS Consolidated Financial Information of Airbus SE for the six-month period
ended 30 June 2017 ................................................................................................................................................ 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 20172017 Semi-annual report of the Board of Directors
1. Semi-annual report on activities
Main events in the first half-year of 2017
For an overview of the main events that occurred during the first half of 2017 and their impact on the Unaudited
Condensed Interim IFRS Consolidated Financial Information of Airbus for the six-month period ended
30 June 2017 (the “Semi-Annual Financial Statements”), please refer to the press release, which was approvedby the Board of Directors on 26 July 2017 and will be issued on 27 July 2017, available on Airbus website
www.airbus.com.
For further information and detail regarding Airbus’ activities, finances, financing, risk factors and corporate
governance, please refer to Airbus’ 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, Airbus is mitigating risk
and increasing opportunity, to support risk taking for value creation and competitiveness. Consequently, thecompany 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 Group SE Report of the Board of Directors 2016 (sections 4.6 and 4.7)
(http://company.airbus.com/dam/assets/airbusgroup/int/en/investorrelations/documents/2017/AGM/Report-of-the-Board-of-Directors-2016-Airbus-GroupSE/Report%20of%20the%20Board%20of%20Directors%202016%20Airbus%20Group%20SE.pdf), andb.

Airbus Group SE Registration Document (section “Risk Factors”)(http://company.airbus.com/dam/assets/airbusgroup/int/en/investorrelations/documents/2017/AGM/Airbus-Group-SE-Registration-Document-2016/Airbus%20Group%20SE%20Registration%20Document%202016%20.pdf).

2

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

3. Semi-Annual Financial Statements
The Semi-Annual Financial Statements, including the review report by Ernst & Young Accountants LLP, areattached 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 2017 give a true and fair view of the assets,
liabilities, financial position and profits or losses of Airbus and undertakings included in the consolidation taken asa whole; andthis Semi-Annual Board Report (including the press release, which was approved by the Board of Directors on
26 July 2017 and will be issued on 27 July 2017) gives a true and fair view of the position as per the balance
sheet date, and of the development and performance during the first half of the 2017 financial year and expectedcourse 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 thedevelopment of revenues and profitability is dependent, as these have been described herein.

26 July 2017,
The Board of Directors
Denis Ranque, Chairman
Tom Enders, Chief Executive Officer
Ralph D. Crosby, Director
Lord Paul Drayson, Director
Catherine Guillouard, Director
Hans-Peter Keitel, Director
Hermann-Josef Lamberti, Director
María Amparo Moraleda Martínez, Director
Claudia Nemat, Director
Sir John Parker, Director
Carlos Tavares, Director
Jean-Claude Trichet, Director

3

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Unaudited Condensed Interim
IFRS Consolidated Financial Information of Airbus SE
for the six-month period ended 30 June 2017
Unaudited Condensed Interim IFRS Consolidated Income Statements .................................................................. 5
Unaudited Condensed Interim IFRS Consolidated Income Statements for the second quarter of 2017 and 2016 . 6
Unaudited Condensed Interim IFRS Consolidated Statements of Comprehensive Income .................................... 7
Unaudited Condensed Interim IFRS Consolidated Statements of Comprehensive Income for the second quarterof 2017 and 2016..................................................................................................................................................... 8
Unaudited Condensed Interim IFRS Consolidated Statements of Financial Position .............................................. 9
Unaudited Condensed Interim IFRS Consolidated Statements of Cash Flows ..................................................... 10
Unaudited Condensed Interim IFRS Consolidated Statements of Changes in Equity ........................................... 11
Notes to the Unaudited Condensed Interim IFRS Consolidated Financial Statements as at 30 June 2017 .......... 121.

The Company .......................................................................................................................................... 122.

Accounting policies .................................................................................................................................. 12

3.

Acquisitions and disposals ...................................................................................................................... 14

4.

Related party transactions ....................................................................................................................... 14

5.

Segment information ............................................................................................................................... 15

6.

Revenues, gross margin and profit before finance result and income taxes ........................................... 17

7.

Finance result .......................................................................................................................................... 18

8.

Income tax ............................................................................................................................................... 18

9.

Earnings per share .................................................................................................................................. 18

10.

Intangible assets and property, plant and equipment .............................................................................. 19

11.

Investments accounted for under the equity method ............................................................................... 19

12.

Other investments and other long-term financial assets .......................................................................... 19

13.

Inventories ............................................................................................................................................... 19

14.

Other financial assets and other financial liabilities ................................................................................. 20

15.

Other assets and other liabilities.............................................................................................................. 21

16.

Total equity .............................................................................................................................................. 21

17.

Provisions ................................................................................................................................................ 22

18.

Cash flows, securities and financing liabilities ......................................................................................... 22

19.

Financial instruments............................................................................................................................... 23

20.

Litigation and claims ................................................................................................................................ 25

21.

Number of employees ............................................................................................................................. 28

22.

Subsequent events .................................................................................................................................. 28

4

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Unaudited Condensed Interim IFRS Consolidated Income Statements

Note
Revenues

1 January 30 June 2017
In € million
In %6

1 January 30 June 2016
In € million
In %ChangeIn € million

28,709100

28,755100-46-25,341-88-26,643

-93

1,302

3,368

12

2,112

7

1,256

Selling, administrative and other expenses-1,322-5-1,292-4-30

Research and development
expenses-1,288-5-1,309

-5

21

787

3

2,354

8

-1,567

246

1

-14

0

260

1,791

6

1,851

6

-60

Interest income

81

0

137

1

-56

Interest expense

-251

-1

-234

-1

-17

Cost of sales
Gross margin

Other income

6

6

Share of profit (loss) from investments
under the equity method and otherincome from investments
Profit before finance result
and income taxes

6

Other financial result

236

1

-51

0

287

Finance result

7

66

0

-148

0

214

Income taxes

8

-354

-1

58

0

-412

1,503

5

1,761

6

-258

1,503

5

1,761

6

-258

0

0

0

0

0

Profit for the period
Attributable to:Equity owners of the parent(Net income)Non-controlling interests

€

€

€

Basic

1.94

2.27

-0.33

Diluted

1.93

2.26

-0.33

Earnings per share

9

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 2017

Unaudited Condensed Interim IFRS Consolidated Income Statements
for the second quarter of 2017 and 2016

Note
Revenues

1 April 30 June 2017
In € million
In %6

Cost of sales
Gross margin

6

Selling, administrative and other expenses
Research and development
expenses
Other income

6

Share of profit (loss) from investments
under the equity method and otherincome from investments
Profit before finance result
and income taxes

6

1 April 30 June 2016
In € million
In %ChangeIn € million

15,721

100

16,572100-851-13,638-87-15,903

-96

2,265

2,083

13

669

4

1,414

-678

-4

-641

-4

-37

-740

-5

-762

-5

22

84

1

2,269

14

-2,185

190

1

-46

0

236

939

6

1,489

9

-550

Interest income

42

0

62

0

-20

Interest expense

-124

-1

-91

0

-33

Other financial result

354

3

-312

-2

666

Finance result

7

272

2

-341

-2

613

Income taxes

8

-317

-2

215

1

-532

894

6

1,363

8

-469

Equity owners of the parent(Net income)

894

6

1,362

8

-468

Non-controlling interests

0

0

1

0

-1

Profit for the period
Attributable to:

€

€

€

Basic

1.16

1.76

-0.60

Diluted

1.15

1.75

-0.60

Earnings per share

9

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 2017

Unaudited Condensed Interim IFRS Consolidated Statements of Comprehensive
Income(In € million)
Profit for the period

1 January 30 June 2017

1 January 30 June 2016

1,503

1,761

362

-1,711

Items that will not be reclassified to profit or loss:
Remeasurement of the defined benefit pension plans
Share of remeasurement of the defined benefit pension plansfrom investments accounted for under the equity method
Income tax relating to items that will not be reclassified

5

-6

-113

496

Items that may be reclassified to profit or loss:
Foreign currency translation differences for foreign operations

-314

-284

Change in fair value of cash flow hedges

6,746

2,040

Change in fair value of available-for-sale financial assets

129

-141

Share of changes in other comprehensive income
from investments accounted for under the equity method

-13

-27

Income tax relating to items that may be reclassified-1,954-626

Other comprehensive income, net of tax

4,848

-259

Total comprehensive income of the period

6,351

1,502

Equity owners of the parent

6,326

1,487

Non-controlling interests

25

15

Attributable to:

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 six-month period ended 30 June 2017

Unaudited Condensed Interim IFRS Consolidated Statements of Comprehensive
Income for the second quarter of 2017 and 2016
(In € million)
Profit for the period

1 April 30 June 2017

1 April 30 June 2016

894

1,363

297

-1,001

Items that will not be reclassified to profit or loss:
Remeasurement of the defined benefit pension plans
Share of remeasurement of the defined benefit pension plansfrom investments accounted for under the equity method-1-3Income tax relating to items that will not be reclassified

-74

277

Items that may be reclassified to profit or loss:
Foreign currency translation differences for foreign operations

-277

-37

Change in fair value of cash flow hedges

4,928-1,503

Change in fair value of available-for-sale financial assets

76

-239

Share of changes in other comprehensive income
from investments accounted for under the equity method-4-7

Income tax relating to items that may be reclassified-1,441

449

Other comprehensive income, net of tax

3,504-2,064

Total comprehensive income of the period

4,398

-701

Equity owners of the parent

4,383

-720

Non-controlling interests

15

19

Attributable to:

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 2017

Unaudited Condensed Interim IFRS Consolidated Statements of Financial Position
Note
AssetsNon-current assets
Intangible assets
Property, plant and equipment
Investments accounted for under the equity method
Other investments and other long-term
financial assets
Non-current other financial assets
Non-current other assets
Deferred tax assets
Non-current securities
Current assets
Inventories
Trade receivables
Current portion of other long-term financial assets
Current other financial assets
Current other assets
Current tax assets
Current securities
Cash and cash equivalents
Assets and disposal group of assets
classified as held for sale
Total assets

30 June 2017
In € million In %In %11,67916,554
1,500

10
15
1

12,06816,918
1,608

11
15
2

-389
-364
-108

-3
-2
-7

12
14
15

4,238
1,487
2,387
6,026
10,09153,962

4
1
2
5
9
47

3,655
976
2,358
7,557
9,897
55,037

3
1
2
7
9
50

583
511
29
-1,531194-1,075

16
52
1
-20
2
-2

34,789
8,119
473
1,591
3,399
885
1,363
7,887
58,506

31
7
1
1
3
1
1
7
52

29,688
8,101
522
1,257
2,576
1,110
1,551
10,14354,948

27
7
1
1
2
1
1
9
49

5,101
18
-49
334
823
-225
-188
-2,256
3,558

17
0
-9
27
32
-20
-12
-22
6

965
113,433

1
100

1,148
111,133

1
100

-183
2,300

-16
2

775
8,553
-276
-3
9,049
-5
9,044

1
8
0
0
9
0
9

773
7,732
-4,845
-3
3,657
-5
3,652

0
7
-4
0
3
0
3

2
821
4,569
0
5,392
0
5,392

0
11
-94
0
147
0
148

17
18
14
15

10,3539,764
8,831
17,1992,041
48,188

9
9
8
15
2
43

10,826
8,791
13,313
16,567
1,292
50,789

10
8
12
15
1
46

-473
973
-4,482632
749-2,601

-4
11
-34
4
58
-5

17
18

5,360
1,678
13,5101,044
3,844
30,282
55,718

5
1
12
1
3
27
49

6,143
1,687
12,532
1,126
5,761
28,45255,701

5
2
11
1
5
26
50

-783
-9
978
-82
-1,917
1,830
17

-13
-1
8
-7
-33
6
0

18

13
12
14
15
18
18

3

Non-controlling interests
16

Current liabilities
Current provisions
Short-term financing liabilities
Trade liabilities
Current tax liabilities
Current other financial liabilities
Current other liabilities

ChangeIn € million

10
10
11

Total equity(1)Equity attributable to equity owners of the parent
Capital stockReserves
Accumulated other comprehensive income
Treasury shares

Liabilities
Non-current liabilities
Non-current provisions
Long-term financing liabilities
Non-current other financial liabilities
Non-current other liabilities
Deferred tax liabilities

31 December 2016
In € million In %14
15

Disposal group of liabilities
classified as held for sale
3
483
0
991
1
-508
-51
Total liabilities
104,38992
107,48197-3,092-3
Total equity and liabilities
113,433
101
111,1331002,3002(1) As of 30 June 2017, the accumulated other comprehensive income, previously classified within equity relating to assets anddisposal groups classified as held for sale, amounts to €-86 million.
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 2017

Unaudited Condensed Interim IFRS Consolidated Statements of Cash Flows
1 January 30 June 2017

1 January 30 June 2016

1,503

1,761

0

0

Depreciation and amortization

1,086

1,073

Valuation adjustments

-157

111

Deferred tax expense (income)

170

-494

(In € million)

Note

Profit for the period attributable to equity owners of the parent (Net income)
Profit (loss) for the period attributable to non-controlling interests
Adjustments to reconcile profit for the period to cash provided by operating activities

Change in income tax assets, income tax liabilities and provisions for income tax

150

143

Results on disposals of non-current assets-764-1,828Results of companies accounted for under the equity method

-146

21

Change in current and non-current provisions

-477

493

Reimbursement from / contribution to plan assets-146-3,139-174-2,497-1,920-1,391-1,060-1,259Change in other operating assets and liabilities
Cash (used for) operating activities

18

Investment activities- Purchases of intangible assets, PPE- Proceeds from disposals of intangible assets, PPE

86

19- Acquisitions of subsidiaries and joint ventures (net of cash)

0

-117

- Proceeds from disposals of subsidiaries (net of cash)

740

732

- Payments for investments in associates and otherinvestments and long-term financial assets

-501

-261

- Proceeds from disposals of associates and otherinvestments and long-term financial assets

379

37

- Dividends paid by companies valued at equity

19

17

Disposal of assets, liabilities and disposal group classified as held for sale

0

1,527

Change in securities

-149

306

-486

1,001

Financing activities
Change in long-term and short-term financing liabilities

1,512

3,426

Cash distribution to Airbus SE shareholders-1,043-1,008Dividends paid to non-controlling interests-2-1

Changes in capital and non-controlling interests

79

53

Share buyback

0

-736

Cash (used for) provided by investing activities

18

Cash provided by financing activities

18

546

1,734

Net (decrease) increase of cash and cash equivalents-170-2,030-35
1,309Cash and cash equivalents at beginning of period (1)10,160

6,677

Cash and cash equivalents at end of period

8,130

7,986

Thereof presented as cash and cash equivalents

7,887

7,965

Thereof presented as part of disposal groups classified as held for sale

243

21

Effect of foreign exchange rate changes on cash and cash equivalents(1) The cash and cash equivalents at the beginning of the period 2017 include €17 million, 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.

10

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Unaudited Condensed Interim IFRS Consolidated Statements of Changes in Equity(In € million)
Balance at 1 January 2016

Equityattributable
to equity ownersof the parent

Non-controllinginterests

5,966

7

Total
5,973

Profit for the period

1,761

0

1,761

Other comprehensive income

-274

15

-259

Total comprehensive income
Cash distribution to shareholders / dividends
to non-controlling interests
Capital increase

1,487

15

1,502

-1,008-1-1,00953

053Equity transactions

39

-20

19

-513

0

-513

28

0

28

Balance at 30 June 2016

6,052

1

6,053

Balance at 1 January 2017

3,657

-5

3,652

Profit for the period

1,503

0

1,503

Other comprehensive income

4,823

25

4,848

Total comprehensive income
Cash distribution to shareholders / dividends
to non-controlling interests
Capital increase

6,326

25

6,351

-1,043-2-1,04579

079

Equity transactions

0

-23

-23

Share-based payment (IFRS 2)

30

0

30

9,049

-5

9,044

Change in treasury shares
Share-based payment (IFRS 2)

Balance at 30 June 2017

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

11

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Notes to the Unaudited Condensed Interim IFRS Consolidated Financial Statements as
at 30 June 2017
1. The Company
The accompanying Unaudited Condensed IFRS Consolidated Financial Statements present the financial position
and the results of operations of Airbus SE (the “Company”) and its subsidiaries, a European public limited-liability
company (Societas Europaea) with its seat (statutaire zetel) in Amsterdam, The Netherlands, its registeredaddress at Mendelweg 30, 2333 CS Leiden, The Netherlands, and registered with the Dutch Commercial Register(Handelsregister) under number 24288945, and are prepared and reported in euro (“€”). On 1 January 2017, theCompany has been further integrated by merging its Group structure with the commercial aircraft activities ofAirbus, with associated restructuring measures. On 12 April 2017, the Company changed its name from Airbus
Group SE to Airbus SE, following approval at the Annual General Meeting. Therefore, the Company together
with its subsidiaries is referred to as “Airbus” and no longer the “Group”, and the segment formerly known as
Airbus is referred to as “Airbus Commercial Aircraft”. In this new set-up, Airbus retains Airbus Helicopters andAirbus Defence and Space as Divisions. During 2017, Airbus will continue to report under the existing reportablesegments. Airbus’ core business is the manufacturing of commercial aircraft, civil and military helicopters,commercial space launch vehicles, missiles, military aircraft, satellites, defence systems and defence electronics
and rendering of services related to these activities. The Unaudited Condensed IFRS Consolidated Financial
Statements for the six-month period ended 30 June 2017 were authorised for issue by the Company Board of
Directors on 26 July 2017.

2. Accounting policies
The Unaudited Condensed Interim Consolidated Financial Statements have been prepared in accordance with
International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board(“IASB”) as endorsed by the European Union (“EU”) as at 30 June 2017.
These Unaudited Condensed Interim Consolidated Financial Statements are prepared in compliance with IAS 34
and should be read in conjunction with Airbus’ Consolidated Financial Statements as of 31 December 2016.
Airbus’ accounting policies and methods are unchanged compared to 31 December 2016.
Use of estimates and judgment
In preparing Airbus’ Unaudited Condensed Interim Consolidated Financial Statements, Airbus’ management
makes assumptions and estimates. The underlying assumptions used for the main estimates are similar to thosedescribed in Airbus’ Consolidated Financial Statements as of 31 December 2016. These estimates are revised if
the underlying circumstances have evolved or in light of new information.
The only exception is 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.

12

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

IFRS 15 “Revenue from contracts with customers”
As indicated in the Consolidated Financial Statements as at 31 December 2016, IFRS 15 will replace the current
revenue recognition standards.
Airbus will adopt the new standard on 1 January 2018, using the full retrospective transition method. Accordingly,
the comparative 2017 results included in the 2018 financial statements will be restated, and equity will be
adjusted as of 1 January 2017. Airbus will elect practical expedients for completed contracts and contract
modifications.
Impacts on current revenue from construction contracts
Airbus has compared its current accounting policies and practices to the requirements of the new standard. As aresult of this analysis, Airbus expects that the adoption of IFRS 15 will have a significant impact on the timing ofrevenue recognition on certain long-term construction contracts that are currently accounted for under IAS 11.
The most significant changes will result from the following:In some cases the over time revenue recognition criteria are not fulfilled under IFRS 15. In particular, on
A350 launch contracts, on A400M series production and certain NH90 contracts, revenue relative to the
manufacture of aircraft will hence be recognised at the delivery of the aircraft to the customer.

Measurement of the revenue will take into consideration variable consideration constraints in order toachieve high likelihood that a significant reversal of the recognised revenue will not occur in the future.



The measure of the progress towards complete satisfaction of a performance obligation satisfied over time
will be based on inputs (i.e. cost incurred) rather than on outputs (i.e. milestones achieved). On Airbus
current long-term construction contracts progress is usually measured based on milestones achieved. Under
IFRS 15, Airbus will measure progress of work performed using a cost-to-cost approach, whenever controlof the work performed transfers to the customer over time.

Impacts on current revenue from the sale of commercial aircraft
With respect to the commercial aircraft business, other than sales made under the A350 launch contracts
described above, IFRS 15 will not change the timing of recognising revenue, which will continue to be recognised
when the customer takes delivery of the aircraft.
The detailed analysis of the impacts on the prior period financial statements and backlog are ongoing.
Airbus will continue to work during 2017 on the quantification of transition effects and on the design andimplementation of procedures to apply the new requirements.

13

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

3. Acquisitions and disposals
On 28 February 2017, Airbus sold its defence electronics business, a leading global provider of mission-criticalsensors, integrated systems and services for premium defence and security applications mainly based in Ulm(Germany), to affiliates of KKR & Co. L.P. (the acquirer), a leading global investment firm. The German defence
electronics business was sold for €823 million, Airbus Defence and Space recognised a net gain on sale of €560
million. The closing for the French defence electronics business will occur after full separation of the businesssold from Airbus other business activities and is expected to take place in 2018. The divestment is part of thestrategic review of the Airbus Defence and Space business portfolio. The assets and liabilities of this company
were classified as a disposal group held for sale as of 31 December 2016.
With respect to extending security clearance for the Airbus Defence and Space business, Airbus made a 25.1%
reinvestment into Hensoldt Holding Germany GmbH, a subsidiary of the acquirer which now holds the transferredbusiness. The reinvestment took the form of an equity investment of €6 million and a shareholder loan of €109
million. In addition, the reinvestment agreement provides for a combined put/call option mechanism which is
subject to full separation being achieved and will then allow the acquirer to take over Airbus’ equity investment
and shareholder loan at a pre-determined price at any time, and Airbus to sell them to the acquirer at that priceafter three years.
The purchase price allocation of the Navtech Inc. Group (“Navtech”) ended on 9 March 2017. No adjustment
was made on the goodwill which amounts to €104 million.
Airbus Safran Launchers (“ASL”) transaction finalised over the first half-year 2017 with a final agreement on
Airbus contribution balance sheet leading to €52 million additional capital gain on the period. The purchase priceallocation was completed as of 30 June 2017.
Assets and disposal groups classified as held for sale
As of 30 June 2017, Airbus accounted for assets and disposal groups of assets classified as held for sale in
the amount of €965 million (prior year-end: €1,148 million). Disposal group of liabilities classified as held forsale as of 30 June 2017 amount to €483 million (prior year-end: €991 million). These amounts comprise mainly
the disposal group of assets and liabilities of Vector.
On 5 July 2017, StandardAero Aviation Holdings, Inc. (“StandardAero”) and Airbus entered into exclusive
negotiations with respect to an acquisition by StandardAero of Vector Aerospace Holding SAS (“Vector”) from
Airbus. Vector is a global aerospace maintenance, repair and overhaul company, providing quality support for
turbine engines, components, and fixed and rotary-wing aircraft. It generated revenues of €638 million in 2016
and employs approximately 2,200 people in 22 locations.

4. Related party transactions
Airbus has entered into various transactions with related entities that have all been carried out in the normal
course of business.
Airbus participates in the UK in several funded trustee-administered pension plans, some of which have BAE
Systems as principal employer.

14

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

5. Segment information
Airbus operates in three reportable segments which reflect the internal organizational and management structure
according to the nature of the products and services provided.


Airbus Commercial Aircraft (formerly Airbus) — Development, manufacturing, marketing and sale ofcommercial jet aircraft of more than 100 seats; aircraft conversion and related services; development,
manufacturing, marketing and sale of regional turboprop aircraft and aircraft components.

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



Airbus Defence and Space — Military combat aircraft and training aircraft; provision of defence electronics
and of global security market solutions such as integrated systems for global border security and securecommunication solutions and logistics; training, testing, engineering and other related services;development, manufacturing, marketing and sale of missile systems; development, manufacturing,marketing and sale of satellites, orbital infrastructures and launchers; provision of space related services;development, manufacturing, marketing and sale of military transport aircraft and special mission aircraft
and related services.

The following table presents information with respect to the Airbus’ business segments. As a rule, inter-segment
transfers are carried out on an arm’s length basis. Inter-segment sales predominantly take place between Airbus
Commercial Aircraft and Airbus Defence and Space and between Airbus Helicopters and Airbus Commercial
Aircraft. The holding function of Airbus’ Headquarters, the Airbus Bank and other activities not allocable to thereportablesegments,

combined

togetherwith

consolidation“Other/HQ/Conso.”.

15

effects,aredisclosedinthecolumnAirbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Business segment information for the six-month period ended 30 June 2017:(In € million)
Total revenues
Internal revenues

AirbusCommercial
Aircraft

AirbusHelicopters

AirbusDefenceand SpaceTotal
segments

Other/
HQ/Conso.

Consolidated

21,789

2,921

4,625

29,33527

29,362

-346

-257

-49

-652

-1

-653

21,443

2,664

4,576

28,68326

28,709Research anddevelopment expenses

-928

-142

-144

-1,214-74-1,288

Profit before financeresult and income taxes

1,078

93

816

1,987

-196

1,791

Revenues

Finance result

66

Income taxes-354

Profit for the period

1,503

Business segment information for the six-month period ended 30 June 2016:
AirbusCommercial
Aircraft

AirbusHelicopters

AirbusDefenceand SpaceTotal
segments

Other/
HQ/Conso.

Consolidated

Total revenues

21,061

2,687

5,440

29,188155

29,343

Internal revenues

-202

-327

-57

-586

-2

-588

(In € million)

Revenues

20,859

2,360

5,383

28,602

153

28,755

Research anddevelopment expenses

-957

-151

-152

-1,260-49-1,309Profit before financeresult and income taxes

420

144

475

1,039

812

1,851

Finance result-148

Income taxes

58

Profit for the period

1,761

16

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

6. Revenues, gross margin and profit before finance result and income taxes
Revenues of €28,709 million (first half-year 2016: €28,755 million) are stable compared to previous year. The
decrease in Airbus Defence and Space (€-815 million) was primarily due to perimeter changes and partially offset
by an increase at Airbus Commercial Aircraft (€+728 million) mostly driven by a favourable foreign exchange
impact.
The gross margin increased by €+1,256 million to €3,368 million compared to €2,112 million in the first half-year2016, mainly at Airbus Defence and Space and Airbus Commercial Aircraft, principally due to a lower net charge
related to the A400M (€70 million, compared to first half-year 2016 €1,026 million) and the A350 XWB
programmes (€0 million, compared to first half-year 2016 €385 million), respectively. The gross margin rateincreased from 7.3% to 11.7%.
In the first six months 2017, Airbus Commercial Aircraft has delivered 30 A350 XWB aircraft. Order cancellations
to the end of June 2017 have been reflected in the financial statements.
The industrial ramp-up is progressing and associated risks continue to be closely monitored in line with theschedule, aircraft performance and overall cost envelope, as per customer’s commitment. Despite the progress
made, challenges remain with recurring cost convergence as the ramp-up accelerates.
8 A400M aircraft were delivered during the first half-year 2017. In total, 46 aircraft have now been delivered to thecustomer as of 30 June 2017.
Industrial efficiency and military capabilities remain a challenge for the A400M programme. In the first half-year2017, Airbus continued with development activities toward achieving the revised capability roadmap shared withthe customer, however achievement of contractual technical capabilities remains highly challenging.
As a result of the 2016 detailed contract reviews, Airbus Defence and Space had recorded a charge of €2,210
million (thereof €1,026 million in the first half-year 2016). As at 30 June 2017, the operational and commercial
assumptions that were retained in 2016 remain current best management assessment. The update of theprovision during the first half-year 2017 reflects price escalation and cash impacts of current year deliveries,
leading to a charge of €70 million.
Given the order of magnitude on the cumulative programme loss, the Board of Directors mandated the
management in February 2017 to re-engage with customers to cap the remaining exposure. Related discussions
with the customer are in progress. Challenges remain on development of contractual technical capabilities andthe associated costs, on securing sufficient export orders in time, on cost reductions and commercial exposure,which could all impact significantly the programme. The A400M contractual SOC 1, SOC 1.5 and SOC 2
milestones remain to be achieved. SOC 1 fell due end October 2013, SOC 1.5 fell due end December 2014, and
SOC 2 end of December 2015. The associated termination rights became exercisable by OCCAR on 1 November
2014, 1 January 2016, and 1 January 2017, respectively. Management judges that it is highly unlikely that any ofthese termination rights will be exercised.
The profit before finance result and income taxes decreased by €-60 million to €1,791 million compared to€1,851 million in the first six months 2016, mainly driven by an decrease in other income, partly offset by theincrease in gross margin and share of profit (loss) from investments under the equity method and other income
from investments.

17

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Other income decreased by €-1,567 million to €787 million compared to €2,354 million in the first six months
2016, which included the capital gain of €1,139 million following the creation of ASL and the disposal of Dassault
Aviation shares. In the first six months 2017, it includes the capital gain from the sale of the defence electronics
business and the completion of the allocation of the purchase price of ASL (see Note 3 “Acquisitions anddisposals”).

7. Finance result
Finance result improved by €+214 million to €66 million compared to €-148 million in the first six months 2016.
This is mainly related to a positive impact from both the revaluation of financial instruments of €+140 million andforeign exchange valuation of monetary items of €+137 million.

8. Income tax
The income tax expense of €-354 million (first half-year 2016: income of €58 million) corresponds to an effective
tax rate of 19.1% (first half-year 2016: -3%). These effective tax rates were impacted by transactions taxed at
reduced rates, relating to the disposal of the defence electronics business in the first six months 2017, and thesale of shares of Dassault Aviation and the creation of ASL, in the first six months 2016. Without these impacts,
the effective tax rate would be approximately 28%.

9. Earnings per share

Basic earnings per share

1 January 30 June 2017

1 January 30 June 2016

Profit for the period attributable to equity owners of the parent(Net income)€1,503 million€1,761 million

Weighted average number of ordinary shares outstanding

773,223,614

775,116,098

€1.94

€2.27

Basic earnings per share

Diluted earnings per share – Airbus’ categories of dilutive potential ordinary shares are share-settled
Performance Units relating to Long-Term Incentive Plans and the convertible bond issued on 1 July 2015. In
2016, it also included the last Stock Option Plan (“SOP”) which expired in December 2016. During the firsthalf-year 2017, the average price of the Company’s shares exceeded the exercise price of the share-settled
Performance Units and therefore 461,810 shares (first six months 2016: 293,675 shares) were considered in thecalculation of diluted earnings per share. The dilutive effect of the convertible bond was also considered in thecalculation of diluted earnings per share in the first half-year 2017, by adding back €3 million of interest expense
to the profit for the period attributable to equity owners of the parent (first six months 2016: €3 million) and byincluding 5,022,990 of dilutive potential ordinary shares.

Diluted earnings per share

1 January 30 June 2017

1 January 30 June 2016

Profit for the period attributable to equity owners of the parent(Net income)€1,506 million€1,764 million

Weighted average number of ordinary shares outstanding(diluted)(1)

778,708,414

780,432,763

€1.93

€2.26

Diluted earnings per share(1) Dilution assumes conversion of all potential ordinary shares

18

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

10. Intangible assets and property, plant and equipment
Intangible assets decreased by €-389 million to €11,679 million (prior year-end: €12,068 million) mainly due tothe reclassification of Vector to disposal groups classified as held for sale (see Note 3 “Acquisitions anddisposals”).
Intangible assets mainly relate to goodwill of €9,181 million (prior year-end: €9,425 million).
The annual impairment tests were performed in the fourth quarter 2016 and led to no impairment charge.
Property, plant and equipment decreased by €-364 million to €16,554 million (prior year-end: €16,918 million)
mainly at Airbus Helicopters (€-191 million) mainly due to the reclassification of Vector to disposal groups
classified as held for sale (see Note 3 “Acquisitions and disposals”). Property, plant and equipment includes
leased assets of €195 million (prior year-end: €116 million).

11. Investments accounted for under the equity method
Investments accounted for under the equity method decreased by €-108 million to €1,500 million (prioryear-end: €1,608 million) and include mainly the equity investments on ASL, MBDA and ATR.

12. Other investments and other long-term financial assets
Composition of other investments and other long-term financial assets:(In € million)

30 June 201731 December 2016

Other investments

2,249

2,091

Other long-term financial assets

1,989

1,564

Total non-current other investments and other long-term financial
assets

4,238

3,655

Current portion of other long-term financial assets
Total

473

522

4,711

4,177

Other investments include the remaining participation in Dassault Aviation of €1,009 million.
Other long-term financial assets mainly comprise the aircraft financing activities.

13. Inventories
Inventories of €34,789 million (prior year-end: €29,688 million) increased by €+5,101 million. This is driven by
Airbus Commercial Aircraft (€+4,813 million) and Airbus Defence and Space (€+327 million). The former mainlyreflects an increase in work in progress associated with A350 XWB and A320 ramp-up.

19

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

14. Other financial assets and other financial liabilities
Composition of other financial assets:(In € million)

30 June 201731 December 2016

1,405

893

82

83

Positive fair values of derivative financial instruments
OthersTotal non-current other financial assets

1,487

976

Receivables from related companies

851

517

Positive fair values of derivative financial instruments

346

258

Others394

482

Total current other financial assets

1,591

1,257

Total

3,078

2,233

30 June 201731 December 2016

European Governments refundable advances

6,564

6,340

Negative fair values of derivative financial instruments

1,865

6,544

402

429

8,831

13,313Composition of other financial liabilities:(In € million)

OthersTotal non-current other financial liabilities
European Governments refundable advances

428

730

2,742

4,476

674

555

Total current other financial liabilities

3,844

5,761

Total

12,675

19,074

Negative fair values of derivative financial instruments
OthersThe liabilities for derivative financial instruments have decreased as a result of the devaluation of the US dollar
versus the euro associated with the mark to market valuation of the hedge portfolio.

20

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 201715. Other assets and other liabilities
Composition of other assets:(In € million)

30 June 201731 December 2016

2,291

2,265

Prepaid expenses
Others96

93

Total non-current other assets

2,387

2,358

VAT receivables

1,830

1,589

Prepaid expenses

879

552

Other

690

435

Total current other assets

3,399

2,576

Total

5,786

4,934

30 June 201731 December 2016

16,352

15,714

599

565

248

288

17,19916,567

Customer advance payments

25,57324,115

Tax liabilities (excluding income tax)

1,236

1,047

Others

2,598

2,373

875

917

Total current other liabilities

30,28228,452

Total

47,48145,019Composition of other liabilities:(In € million)
Other liabilities
Customer advance payments
OthersDeferred income
Total non-current other liabilities
Other liabilities

Deferred income

16. Total equity
Equity attributable to equity owners of the parent (including purchased treasury shares) amounts to€9,049 million (prior year-end: €3,657 million) representing an increase of €+5,392 million. This is due to anincrease in other comprehensive income of €+4,823 million, principally related to the mark to market revaluationof the hedge portfolio of €+4,758 million, and a net income for the period of €+1,503 million, partly offset by adividend payment of €-1,043 million (€1.35 per share).
The total number of shares issued is 774,467,480 and 772,912,869 as of 30 June 2017 and 31 December 2016.
The Company’s shares are exclusively ordinary shares with a par value of €1.00.
In the first six months 2017, the Company issued 1,554,611 new shares due to the 2016 Employee Stock
Ownership Plan (first six months 2016: 98,000).
During the first half-year 2017, the number of treasury stock held by the Company increased to 184,574
compared to 184,170 as of 31 December 2016. No shares were sold back to the market nor cancelled (first six
months 2016: 14,131,131 shares).
Non-controlling interests amount to €-5 million (prior year-end: €-5 million).

21

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 201717. Provisions
Provisions are comprised of the following:(In € million)

30 June 201731 December 2016

Provisions for pensions

8,281

8,656

Other provisions

7,432

8,313

Total

15,713

16,969Thereof non-current portion

10,353

10,826

Thereof current portion

5,360

6,143

Other provisions are presented net of programme losses against inventories (see Note 13 “Inventories”) anddecreased by €-881 million.
A provision of €160 million related to restructuring measures was recorded at year-end 2016 following thecommunication of the plan to the employees and the European Works Council in November 2016. The Frenchsocial plan has been agreed between Airbus and the works council in June 2017, and the plan in Germany is still
under discussion. On this basis, there is no change in the assessment of the restructuring provision as of 30 June2017.
An H225 Super Puma helicopter was involved in an accident on 29 April 2016. Management is cooperating fully
with the authorities to determine the precise cause of the accident. An estimate of the related future costs has
been prepared and is included in other provisions.
Airbus makes estimates and provides, across the programmes, for costs related to in service technical issues
which have been identified and for which solutions have been defined, which reflects the latest facts andcircumstances. Contractually, Airbus is not liable towards operators for any incidental, indirect or consequential
damages. However, in view of overall commercial relationships and factual circumstances, contract adjustments
may occur, and be considered on a case by case basis.

18. Cash flows, securities and financing liabilities
Cash flows
Cash used for operating activities amounts to €-1,920 million (first half-year 2016: €-1,391 million). Gross cash
flow from operations (before change in other operating assets and liabilities) amounts to €+1,219 million (firsthalf-year 2016: €+1,106 million). Change in other operating assets and liabilities amounts to €-3,139 million(first half-year 2016: €-2,497 million), mainly related to increase on inventories, partly offset by advance payments
received and trade liabilities.
Cash (used for) provided by investing activities amounts to €-486 million (first half-year 2016: €+1,001
million). This comprises the impact of purchases of intangible assets and property, plant and equipment of€-1,060 million (first half-year 2016: €-1,259 million) and payments for investments in associates and otherinvestments and long-term financial assets of €-501 million (first half-year 2016: €-261 million). This was partly
compensated by disposals for a total of €+1,119 million (first half-year 2016: €+2,296 million), which includes
mainly the sale of the defence electronics business (see Note 3 “Acquisitions and disposals”).
Cash provided by financing activities amounts to €+546 million (first half-year 2016: €+1,734 million). This
corresponds to changes in long-term and short-term financing liabilities of €+1,512 million (first half-year 2016:€+3,426 million), in part offset by a dividend payment of €1.35 per share which amounts to €-1,043 million (firsthalf-year 2015: €-1,008 million).

22

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Securities
Non-current securities with a remaining maturity of more than one year increased by €+194 million to €10,091
million (prior year-end: €9,897 million). The movement is related to the cash management policy of Airbus.
Current securities with a remaining maturity of one year or less decreased by €-188 million to €1,363 million(prior year-end: €1,551 million).
Financing liabilities
Composition of financing liabilities:(In € million)

30 June 201731 December 2016

Bonds

7,181

6,013

Liabilities to financial institutions

1,985

2,072

Loans

270

331

Liabilities from finance leases

327

374

1

1

9,764

8,791

0

0

Liabilities to financial institutions

231

351

Loans

284

332

OthersLong-term financing liabilities
Bonds

Liabilities from finance leases

15

15

Others1,148

989

Short-term financing liabilities

1,678

1,687

The increase in financing liabilities is mainly related to the issuance of bonds. The increase in bonds
corresponds principally to a bond issued on 5 April 2017, for a total of US$1.5 billion, with a 10 year-maturity
tranche of US$750 million at fixed coupon of 3.150%, and a 30 year-maturity tranche of US$750 million at a fixedcoupon of 3.950%.

19. Financial instruments
Composition of derivative financial instruments:(In € million)

30 June 201731 December 2016

1,405

893

346

258

Total positive fair values of derivative financial instruments

1,751

1,151

Non-current negative fair values-1,865-6,544Non-current positive fair values
Current positive fair values

Current negative fair values-2,742-4,476

Total negative fair values of derivative financial instruments-4,607-11,020

Total net fair value of derivative financial instruments-2,856-9,869The volume of hedged US dollar-contracts was US$96.8 billion as at 30 June 2017 (prior year-end US$102.4
billion). The US dollar spot rate was 1.14 US$/€ and 1.05 US$/€ at 30 June 2017 and at 31 December 2016,
respectively. The average US dollar hedge rate for Airbus portfolio decreased to 1.24 US$/€ as at 30 June 2017
compared to 1.25 US$/€ as at 31 December 2016.

23

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Carrying amounts and fair values
Fair values of financial instruments have been determined with reference to available market information at theend of the reporting period and the valuation methodologies as described in detail in Note 35.2 to the 2016
Consolidated Financial Statements. For the first six months 2017, Airbus has applied the same methodologies forthe fair value measurement of financial instruments.
Carrying amount is a reasonable approximation of fair value for all classes of financial instruments listed in thefirst table of Note 35.2 to the 2016 Consolidated Financial Statements, with the exception of:

30 June 2017
(In € million)

31 December 2016

Book value

Fair value

Book value

Fair value

Issued bonds and commercial papers-7,181-7,302-6,013-6,217

Liabilities to financial institutions
and other financing liabilities-3,919-3,936-4,076-4,086

Financing liabilities

For certain unlisted equity investments, and put or call options linked to those investments, as well as European
Governments refundable advances, no fair values can be reliably determined because the range of reasonable
fair value estimates is significant and the probabilities of the various estimates within that range is significant.
These instruments are therefore carried at amortised cost.
The following table allocates the financial assets and liabilities measured at fair value to the three levels of the fair(1)value hierarchy :30 June 2017
(In € million)

31 December 2016

Level 1

Level 2

Level 3

Total

Level 1

Level 2

Level 3

Total

1,735

0

0

1,735

1,597

0

0

1,597

0

1,751

0

1,751

0

1,148

3

1,151

11,4540011,454

11,4462

0

11,448
7,048

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

4,149

2,180

0

6,329

5,513

1,535

0

17,3383,931

021,26918,5562,685

321,2440-4,535-13-4,5480-11,009-11-11,020

0

0

-38

-38

0

-11,009-49-11,058

Financial liabilities measured
at fair value
Derivative instruments
Other liabilities
Total

0

0

-32

-32

0

-4,535-45-4,580(1) The fair value hierarchy consists of the following levels:- 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, either directly (i.e. as prices) orindirectly (i.e. derived from prices);- Level 3: inputs for the asset or liability that are not based on observable market data.

24

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

The development of financial instruments of Level 3 is as follows:

Financial assets

Financial liabilites(In € million)
Balance at 1 January 2016
Profit or loss
Settlements
Balance at 30 June 2016

Commodity
swap
agreements
46
-8
-18
20

Total
46
-8
-18
20

Balance at 1 January 2017
Profit or loss
Other comprehensive income
Settlements
Balance at 30 June 2017

3
0
0
-3
0

3
0
0
-3
0

Written Commodity
put options on
swap
Earn-out
NCI interests agreements agreements
-64
0
-10
0
0
0
39
0
0
-25
0
-10
-28
0
6
0
-22

-11
-7
0
5
-13

-10
0
0
0
-10

Total
-74
0
39
-35
-49
-7
6
5
-45

For a description of the valuation techniques, inputs and process used in the fair value measurement of thesefinancial instruments and a description of sensitivity analysis performed, refer to Note 35.2 of the Consolidated
Financial Statements. There is no material difference between the outcome of sensitivity analysis performed
at 30 June 2017, compared to the outcome disclosed in the year-end financial statements.

20. Litigation and claims
Airbus is involved from time to time in various legal and arbitration proceedings in the ordinary course of its
business, the most significant of which are described below. Other than as described below, Airbus is not awareof any material governmental, legal or arbitration proceedings (including any such proceedings which are pendingor 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 Airbus’ financial position or profitability.
If the Company concludes that the disclosures relative to contingent liabilities can be expected to prejudiceseriously its position in a dispute with other parties, the Company limits its disclosures to the nature of the dispute.
WTO
Although Airbus is not a party, Airbus 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 aparallel 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 theState 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 Commercial Aircraft 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, andto comply with the WTO’s recommendations and rulings. Because the US did not agree, the matter is now under
WTO review pursuant to WTO rules.
On 23 March 2012, the WTO adopted the Appellate Body’s final report in the case brought by the EU assessing
funding to Boeing from the US. On 23 September 2012, the US informed the WTO that it had taken appropriate
steps to bring its measures fully into conformity with its WTO obligations, and to comply with the WTO’s
recommendations and rulings. Because the EU did not agree, the matter is now under WTO review pursuant to
WTO rules.

25

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Exact timing of further steps in the WTO litigation process is subject to further rulings and to negotiations between
the US and the EU. Unless a settlement, which is currently not under discussion, is reached between the parties,
the litigation is expected to continue for several years.
GPT
Promptedbyawhistleblower’s

allegations,Airbusconducted

internal

auditsandretained

PricewaterhouseCoopers (“PwC”) to conduct an independent review relating to GPT Special Project Management
Ltd. (“GPT”), a subsidiary that Airbus acquired in 2007. The allegations called into question a service contract
entered into by GPT prior to its acquisition by Airbus, relating to activities conducted by GPT in Saudi Arabia.
PwC’s report was provided by Airbus to the UK Serious Fraud Office (the “SFO”) in March 2012. In the period
under review and based on the work it undertook, nothing came to PwC’s attention to suggest that improper
payments were made by GPT. In August 2012, the SFO announced that it had opened a formal criminal
investigation into the matter. Airbus is in continuing engagement with the authorities.
Eurofighter Austria
In March 2012, the German public prosecutor, following a request for assistance by the Austrian publicprosecutor, launched a criminal investigation into alleged bribery, tax evasion and breach of trust by current andformer employees of EADS Deutschland GmbH (renamed on 1 July 2014 Airbus Defence and Space GmbH) andEurofighter Jagdflugzeug GmbH as well as by third parties relating to the sale of Eurofighter aircraft to Austria in
2003. After having been informed of the investigation in 2012, Airbus retained the law firm Clifford Chance toconduct a fact finding independent review. Upon concluding its review, Clifford Chance presented its fact finding
report to Airbus in December 2013. Airbus provided the report to the public prosecutors in Germany. Airbus’
request for access to the prosecutor’s file is pending. Airbus Defence and Space GmbH settled with the tax
authorities in August 2016 on the question of deductibility of payments made in connection with the Eurofighter
Austria campaign. In February 2017, the Austrian Federal Ministry of Defence has raised criminal allegations
against Airbus Defence and Space GmbH and Eurofighter Jagdflugzeug GmbH for wilful deception and fraud inthe context of the sale of the Eurofighter aircraft to Austria and respective damage claims. After the AustrianFederal Ministry of Defence raised its criminal allegations, the Austrian public prosecutor opened an investigation
against Airbus Defence and Space GmbH, Eurofighter Jagdflugzeug GmbH and former and current employees of
the two entities. Airbus is cooperating fully with the authorities.
Investigation by the UK SFO and France’s PNF into Civil Aviation BusinessIn the context of review and enhancement of its internal compliance improvement programme, Airbus discovered
misstatements and omissions relating to information provided in respect of third party consultants in certain
applications for export credit financing for Airbus customers. In early 2016, Airbus informed the UK, German andFrench Export Credit Agencies (“ECAs”) of the irregularities discovered. Airbus made a similar disclosure to the
UK Serious Fraud Office (“SFO”). In August 2016, the SFO informed Airbus that it had opened an investigation
into allegations of fraud, bribery and corruption in the civil aviation business of Airbus relating to irregularities
concerning third party consultants (business partners). In March 2017, France’s Parquet National Financier(“PNF”) informed Airbus that it had also opened a preliminary investigation into the same subject and that the two
authorities will act in coordination going forward. Airbus is cooperating fully with both authorities. The SFO andPNF investigations and any enforcement action potentially arising as a result could have negative consequences
for Airbus. The potential imposition of any monetary penalty (and the amount thereof) arising from the SFO andPNF investigations would depend on factual findings, and 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. Investigationsof this nature could also result in (i) civil claims or claims by shareholders against Airbus (ii) adverse
consequences on Airbus’ ability to obtain or continue financing for current or future projects (iii) limitations on theeligibility of group companies for certain public sector contracts and/or (iv) damage to Airbus’ business or
reputation via negative publicity adversely affecting Airbus’ prospects in the commercial market place.
26

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

ECA financing
ECA financing continues to be suspended. Airbus is working with the relevant ECAs to re-establish ECA
financing.
Other investigations
In October 2014, the Romanian authorities announced an investigation relating to a border surveillance project inRomania. Airbus confirms that Airbus Defence and Space GmbH had been informed that the German prosecution
office is also investigating potential irregularities in relation to this project, a project in Saudi Arabia and a projectof Tesat-Spacecom GmbH & Co. KG. The public prosecutor in Germany has launched administrative proceedingsin the context of those investigations against Airbus Defence and Space GmbH and Tesat-Spacecom GmbH &Co. KG. Airbus has cooperated fully with the authorities. In October 2016, the German authorities announced thatthey were dropping their investigations into the Romanian and Saudi projects. The tax authorities may challenge
the tax treatment of business expenses in connection with the Romanian and Saudi projects.
In 2013, public prosecutors in Greece and Germany launched investigations into a current employee and former
managing directors and employees of Atlas Elektronik GmbH (“Atlas”), a wholly-owned company of Thyssenkrupp(prior to April 2017, a joint company of ThyssenKrupp and Airbus), on suspicion of bribing foreign officials and tax
evasion in connection with projects in Greece. The public prosecutor in Germany has launched an administrative
proceeding for alleged organisational and supervisory shortfalls against Atlas. The authorities in Greece havelaunched civil claims against Atlas. In 2015, the public prosecutor in Germany launched another investigation intocurrent and former employees and managing directors of Atlas on suspicion of bribery and tax evasion inconnection with projects in Turkey and extended the investigation in 2016 to five current and former employees ofAtlas’ current shareholder and former shareholder. A further investigation was also launched against two former
Atlas employees on suspicion of bribery in connection with projects in Pakistan. In 2016 two further investigations
were started by the Bremen public prosecutor with regard to operations in Indonesia and Thailand. With thesupport of its current and former shareholders, Atlas is cooperating fully with the authorities and conducted its
own internal investigation. In November 2016, Atlas began discussions with the Bremen public prosecutor for a
possible resolution of the allegations of bribery and tax evasion in connection with projects in Greece and several
other countries. In May 2017, Atlas reached a final settlement with the Bremen public prosecutor. The settlement
is

based

on

the

misdemeanour

Aufsichtspflichtverletzung)of

Atlas’

ofnegligent

formerviolation

management,

of

and

the

supervisory

resulted

in

a

duty
profit(fahrlässige
disgorgement(Gewinnabschöpfung) payment (and future tax payments) by Atlas of €55 million euros overall. This brings to an
end the investigation against Atlas.
Airbus is cooperating with a judicial investigation against unknown persons in France related to Kazakhstan.
Airbus is cooperating with French judicial authorities pursuant to a request for mutual legal assistance made by
the government of Tunisia in connection with historical aircraft sales.

27

Airbus SE
Unaudited Condensed Interim IFRS Consolidated Financial Information
for the six-month period ended 30 June 2017

Review of business partner relationships
In light of regulatory investigations and commercial disputes, including those discussed above, Airbus has
determined to enhance certain of its policies, procedures and practices, including ethics and compliance. Airbus isaccordingly in the process of revising and implementing improved procedures, including those with respect to its
engagement of consultants and other third parties, in particular in respect of sales support activities and isconducting enhanced due diligence as a pre-condition for future or continued engagement and to inform decisions
on corresponding payments. Airbus has therefore engaged legal, investigative, and forensic accounting expertiseof the highest calibre to undertake a comprehensive review of all relevant third party business consultant
relationships and related subject matters. Airbus believes that these enhancements to its controls and practices
will best position it for the future, particularly in light of advancements in regulatory standards. Certain consultants
and other third parties have initiated commercial litigation and arbitration against Airbus seeking relief. The
comprehensive review and these enhancements of its controls and practices may lead to additional commercial
disputes or other civil law or criminal law consequences in the future, which could have a material impact on thefinancial statements, however at this stage it is too early to determine the likelihood or extent of any liability.
Commercial disputes
In May 2013, Airbus has been notified of a commercial dispute following the decision taken by Airbus to cease apartnership for sales support activities in some local markets abroad. Airbus believes it has solid grounds tolegally object to the alleged breach of a commercial agreement. However, the consequences of this dispute andthe outcome of the proceedings cannot be fully assessed at this stage. The arbitration will not be completed until
2018 at the earliest.
In the course of another commercial dispute, Airbus received a statement of claim alleging liability for refunding
part of the purchase price of a large contract which the customer claims it was not obliged to pay. The dispute iscurrently the subject of arbitration.

21. Number of employees
The number of employees as at 30 June 2017 is 130,402 as compared to 133,782 as at 31 December 2016.

22. Subsequent events
On 5 July 2017, Airbus entered into a sale agreement of Vector (see Note 3 “Acquisitions and disposals”). The
transaction is subject to workers’ council consultation, signing of definitive agreements and customary approvals,
such as regulatory clearances.
Airbus Defence and Space notified during the first half-year 2017 an option to acquire the remaining 49% of its
subsidiary Airbus DS Airborne Solutions GmbH for an amount of €23 million. Shareholder agreement and closing
possible to happen in the second half-year 2017. The transaction is subject to government approval.

28

Review report
To: 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 2017, the condensed consolidated
statements of comprehensive income, changes in equity, and cash flows for the six-month period then ended 30 June 2017,
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 2017 is not prepared, in all material respects, in accordancewith IAS 34, “Interim Financial Reporting”, as adopted by the European Union.

Amsterdam, 26 July 2017

Ernst & Young Accountants LLP

signed by A.A. van Eimeren