Airbus SE (AIR) Earnings Call Transcript & Summary

Good day, everyone, and thanks for holding. This is Sharon, your operator, and I'd like to welcome you to the conference call marking Airbus's release of its results for the first nine months of 2024. I want to let you know that throughout the presentation, everyone attending will be able to listen only, and this call is being recorded. Once the presentation wraps up, there will be time set aside for questions. Right now, I'll hand things over to your hosts — Guillaume Faury, Thomas Toepfer, and Hélène Le Gorgeu. Over to you.

Thanks, Sharon, and good evening, everyone. This is the conference call covering Airbus's results for the first nine months of 2024. Guillaume Faury, our CEO, and Thomas Toepfer, our CFO, will walk you through the results and then take your questions. We expect this call to run for roughly an hour. That includes the Q&A, which we'll hold after the presentation. There's also a webcast of this call. You can reach it through our homepage by clicking on the dedicated banner. A playback will be available on our website, though we don't offer a dedicated phone replay service. The supporting information package went up on our website earlier today. It contains the slides we're about to take you through, along with the financial statements. During this call, we'll be making forward-looking statements. I'd ask you to refer to the Safe Harbor Statement included in the presentation slides, which applies to this call as well. Please take the time to read it carefully. And with that, I'll hand over to you, Guillaume.

Thank you, Hélène, and good day to all of you, and thanks for being with us on this call covering the nine-month results. Thomas and I are indeed in Amsterdam to walk you through what we've delivered. Before we get into that, as I mentioned on the last call, I'm confident you've already gone through our press release regarding the leadership decisions, and I imagine questions will come up on that later, but allow me to say a few things about it. First, the Board of Directors, as has been announced and stated, has resolved that it will put forward to shareholders the renewal of my mandate as Airbus CEO and as an executive member of the board at the upcoming AGM. So most of you know me by now, and I'm very dedicated to this company, very committed, and I'll keep at it. This decision by our Board of Directors leaves me both honored and humbled. That clearly matters a great deal for the company and for me personally. Second, regarding commercial aircraft, we're announcing that Lars Wagner, currently the CEO of MTU Aero Engines, will come aboard once his present mandate wraps up, which will be finished by the end of next year, by the end of 2025, and he'll join us at the start of 2026 to then take over from Christian Scherer, who today serves as the CEO of Commercial Aircraft at Airbus.

And I want to be clear that Christian and I are both really enthusiastic about the prospect of Lars coming in and taking over from Christian, since we see Lars as one of the absolute top leaders in our industry. In the interim, Christian and I will continue collaborating in what I view — and what we view — as a highly efficient fashion, just as we have up to now, to meet our objectives and handle our challenges. After that, we'll be glad to bring Lars on board. Once more, I'm confident that Lars' background in aerospace engineering, operations, and business management — which, incidentally, includes over 10 years already spent at Airbus — that his experience and talent will make a great contribution to our Airbus executive committee. So that covers that topic. Now, moving on to our nine-month results. We're still operating in a setting we describe as complex and fast-changing. Geopolitical uncertainties along with certain supply chain — what we term challenges or issues — that have arisen during this year compel us to adapt continually. Given that background, we stay focused on our priorities: the production ramp-up in commercial aircraft and the transformation of our defense and space divisions.

So there are two main short-term priorities: ramping up, plus defense and space. Our resources go where they matter most, which means we stay highly focused on what we do, and we want to use our core business activities to push operational efficiency further and thereby satisfy customer demands. In this tough operating climate — and I'd say, jointly with our suppliers — we're moving forward on our plan, with safety and quality always at the heart of everything we do. I stress that. Against that backdrop, I'm extremely pleased about the first XLR delivery to Iberia, which happened yesterday. Having introduced the XLR at the Paris Air Show back in 2019 and now witnessing this milestone is deeply satisfying, since it truly is a major milestone, and I sincerely thank all the teams at Airbus and beyond Airbus for developing and certifying successfully this newest, innovative variant of our remarkable A320 family. During Q3, we handed over 174 commercial aircraft, which brings our year-to-date deliveries to nearly 500 — 497 aircraft, versus 488 last year. That leaves us with a delivery profile for the rest of 2024 that is more backloaded than we expected. So an ambitious year-end rally lies ahead of us — not the first time, but always an interesting situation.

For the first nine months of 2024, our adjusted EBIT came in at EUR 2.8 billion. That figure mirrors both the commercial aircraft deliveries and the strong performance turned in by Airbus Helicopters, though it also takes in the charges booked during the first half on our space business. Free cash flow before customer financing landed at — EUR 4.8 billion, largely a reflection of the inventory build-up that underpins the Q4 deliveries as well as the ramp-up. Given all of that, our 2024 guidance stays unchanged. Turning now to the commercial environment, beginning with commercial aircraft: demand continues to be strong — very strong, in fact — as of nine months, and we booked 667 gross orders, 340 of them in the third quarter. On the A220, we booked 10 orders from airBaltic, which, as you know, is Europe's largest A220 customer. For the A320 family, we booked 457 gross orders — so once again, a very strong order intake for the A320 family. 457, of which 260 came in the third quarter, which brings the backlog for this aircraft family to 7,253, and more than two-thirds of those are for the A321. Shifting to wide bodies, we recorded 200 gross orders as of nine months, including 37 A330neos and 33 A350s, which underlines the good momentum across our wide body family.

Net orders for the nine months came to 648 aircraft after 19 cancellations, and at the close of September our backlog in units was at a record 8,749 aircraft. Turning to helicopters, during the nine months 2024 we booked 308 net orders, compared with 191 in the nine months 2023, and those 308 net orders include 43 H225 aircraft. That confirms the positive dynamic for this aircraft family, the so-called Super Puma or H225 family. In the third quarter, we signed a contract for 12 H225M — the military variant of multi-role helicopters — with the Republic of Iraq, which is not yet reflected in the order book. Overall, I am pleased with this performance. We continue to see positive momentum in both civil and military markets, and we remain focused on securing new business opportunities in both the home countries but also on the export markets. Now on to order intake recorded at defense and space. Here, we continue to see a strong order momentum across our business, and as of nine months 2024, the division had an order intake of EUR 11 billion, out of which EUR 4.5 billion in this third quarter. Very strong momentum in the quarter.

Turning to our space business, it features notably a significant satellite known as SATCOMBw 3 — the prime contract for the next generation of secure military satellite systems serving the German armed forces, that is, Bundeswehr. I want to emphasize that the deals signed lately mirror what we term our new selective bidding strategy. That said, even with the gains we're achieving in space, the landscape stays competitive — extremely competitive — and rather disruptive. So execution is what matters now. To put it more specifically, we're repairing our foundations while simultaneously weighing strategic alternatives, re-examining the European landscape, and assessing possible consolidation options. The fact is, Europe's space industry is facing substantial challenges both within Europe and beyond it, and transformation is needed so it can stay competitive versus other global players, among them some newcomers. We will keep looking for ways to reinforce the European space sector through streamlined investments, building scale, and sharpening our competitiveness so as to deliver added value to our shareholders. At the same time, we're continuing to improve defense and space performance overall via our transformation plan. As you'll remember, late last year we rolled out a fresh organizational structure, shifting engineering and operation functions into the three business lines that carry full accountability.

Then in October—last month—actually, this month, we took an additional step and let our social partners know about the plan to adjust the division's organization and workforce. What this will lead to is the transfer of certain headquarters functions into the business lines over the course of next year—during 2025—along with a cut of as many as 2,500 positions through the middle of 2026. Through these actions we are working to bring back the division's competitiveness, and they will help secure its profitability trajectory. That's where I'll stop my comments for now, and I'll pass things to Thomas, who will walk you through our financials.

Thank you so much, Guillaume, and a warm welcome to everyone joining the call. I'm on page six of the presentation now, and I'll walk you through how we performed financially. Let's begin with revenues for the first nine months of 2024, which rose to EUR 44.5 billion, up 5% year-on-year, and that primarily reflects the count of commercial aircraft deliveries as well as greater volume in our air power business. Regarding R&D, as you can see on the right-hand side of the chart, our expenses came in at EUR 2.4 billion as of the nine months of 2024, compared with EUR 2.2 billion during the same nine-month period of 2023. Although we still anticipate a modest increase for the full year versus last year, I want to be transparent with you that we had to begin capitalizing our development costs earlier in the development process in order to align with accounting standards. This earlier capitalization leads to a lower R&D expense, in the range of a high double-digit number, as of the first nine months of this year, with, of course, the reverse effect on our CapEx. The full capitalized R&D expenses can be found in our appendix, precisely on slide 29. Now, let's move on to our EBIT Adjusted.

I'm now on page seven of the presentation. For the first nine months of 2024, our EBIT Adjusted came in at EUR 2.8 billion, down from EUR 3.6 billion during the same period in 2023. Just for your records, the first nine months of 2023 got a boost from the progress we achieved on compliance topics, which let us release provisions totaling EUR 0.1 billion in commercial aircraft. That said, the 2023 figures also reflected revised assumptions on certain long-term contracts within our space business, and that produced a charge of EUR 0.4 billion. Turning to 2024, the EUR 989 million in charges booked on our space business through the first half of this year represent the primary factor behind the year-on-year drop, and no additional charges were recorded during Q3 2024. I should remind you, though, that one major space program remains under technical review, and at present we anticipate a final assessment on it by year-end. So for the nine months of 2024, the greater number of commercial aircraft deliveries is being offset by investments aimed at preparing the future, including R&D expenses and growth in our workforce — which creates temporary overstaffing — along with a hedge rate that is slightly less favorable. As the upper right-hand side of the chart shows, the level of EBIT adjustments was slightly negative across the first nine months of this year, and those adjustments included a EUR 146 million impact stemming from the dollar working capital mismatch and balance sheet revaluation, with EUR 165 of that arising in Q3.

Those adjustments also included EUR 51 million tied to the gain on Airbus OneWeb Satellites, connected to buying out the remaining 50% of the joint venture — which we already booked in the first quarter — and they include EUR 13.13 million of other costs, compliance costs among them, of which negative EUR 8 million landed in Q3. That brings our nine-month 2024 reported EBIT to EUR 2.7 billion. Turning now to the organization and workforce adaptation at Airbus Defense and Space, which we announced in October: we're still at an early stage of assessing what the financial impact might be, and a restructuring provision will be recognized once the necessary conditions are met. Our financial result came in at negative EUR 92 million, mainly reflecting the interest results in the revaluation of financial instruments, partly offset by the positive effect from revaluing certain equity investments. The core business tax rate remains around 27%. That excludes the potential French surtax, which could have an impact of roughly EUR 300 million for the year 2024 — though of course it would only be payable in 2025. The effective tax rate is 36%, and that includes impacts from the net deferred tax asset impairments, so the resulting net income, as you can see on the page, is EUR 1.8 billion, with reported earnings per share of EUR 2.29, and our nine-month 2024 adjusted EPS stood at EUR 2.71, based on an average of 790 million shares.

Turning now to how we cover our exposure to the US dollar — this is page eight of the presentation — during the nine months of 2024, EUR 16 billion of forwards came to maturity, and the related EBIT impact and euro conversions were realized at a blended rate of $1.21, compared with $1.20 across the nine months of 2023. In the first nine months of this year, we additionally put in place $11 billion of new coverage at a blended rate of $1.12. Consequently, our overall US dollar coverage portfolio, measured in US dollars, sits at $86.7 billion at an average blended rate of $1.22, versus $91.7 billion at $1.23 as of the end of 2023. Let's now look in more detail at free cash flow, on page nine. Free cash flow before customer financing came in at negative EUR 0.8 billion for the first nine months of the year, and this outflow was primarily the result of the change in working capital — in particular the inventory build-up, which of course supports our Q4 deliveries as well as the ramp-up across all programs. The A400M keeps weighing negatively on our free cash flow, and CapEx for the nine months of 2024 was EUR 2.1 billion, reflecting investment in enhancing and upgrading our industrial system.

Looking ahead, to back our ramp-up, we anticipate higher CapEx in 2024, which also mirrors the shift in how development costs are capitalized that I mentioned before. As a result, free cash flow came in at EUR 0.9 billion, with only a small effect from customer financing. On the customer financing side, the environment for aircraft financing is still solid, with financial markets at present holding ample liquidity for our product, and to sum up our net cash position, it was EUR 7.2 billion as of the end of September, while liquidity is still approximately EUR 30 billion. With that said, I'll turn things back over to Guillaume.

Thank you, Thomas. Let me begin with how things stand on commercial aircraft. Across the first nine months of 2024, we handed over 497 aircraft to 77 customers. Looking at the picture by aircraft family, on the A220 first: we delivered 45 aircraft. We're still heading toward a monthly production rate of 14 aircraft in 2026 — rate 14, 2026 — while continuing work on this program's financial performance. On the A320 family, we delivered 396 aircraft, including 231 A321s, which comes to 58% of deliveries for the family, so A321s are a growing percentage. We keep ramping up toward a rate of 75 aircraft per month for 2027. We're very pleased that the first XLR was delivered to Iberia yesterday, and Iberia will soon be flying this aircraft to link Spain with the U.S. East Coast. We also look forward now to watching this new product enter service and bring its unique capabilities in range, economics, and environmental efficiency to a lot of other customers. Turning to widebodies, we delivered 56, of which 20 were A330neos and 36 were A350s. We're now stabilizing A330neo monthly production at around rate four, and on the A350 we continue to target rate 12 in 2028, while also actively managing specific supply chain challenges that could affect the ramp-up trajectory, particularly next year, 2025.

Before we get into the financials, I want to remind everyone that the engines for narrowbody, along with cabin and equipment and aero structures, remain what we refer to as the pacing elements of our commercial aircraft ramp-up. Our efforts are concentrated on these particular items, and we engage in a targeted way at nearly every level of the value chain, and I can tell you our teams are — I'm not sure how to put this — more than fully mobilized. Now let's turn to the financials. In the commercial aircraft business, revenues rose 4% year-on-year, largely reflecting a somewhat higher delivery count. EBIT Adjusted fell to EUR 3 billion from EUR 3.2 billion in nine months 2023, as the delivery increase was offset by investments in what we call preparing the future, notably the hiring of skilled workforce that is temporarily producing overstaffing, and also stemming from the modest rise in R&D. At helicopters, during the nine months we delivered 190 helicopters, which is 7 fewer than in nine months of 2023. Nevertheless, revenues grew to EUR 4.9 billion, reflecting a more favorable mix in programs as well as continued solid performance on services. And EBIT Adjusted came in at EUR 420 million, again reflecting the services and programs mix despite that lower level of deliveries.

And wrapping up the review with defense and space for the nine months of 2024: revenue was up 7% year-on-year, driven largely by the air power business, and partly offset by earlier updates to estimates at completion assumptions in space systems. EBIT Adjusted reflects the EUR 989 million in charges we announced in H1 of this year on the earnings release call. As a point of reference, the nine months of 2023 also carried EUR 0.4 billion of charges. Both impacts came mainly from updating estimates at completion assumptions in our space programs. Here I want to echo Thomas's comments on the one major space program still under review: we are making progress, and we expect final assessments by year-end, slightly before year-end. On the A400M, we delivered five aircraft in 2024. We are continuing development activities toward achieving the so-called revived capability roadmap. Our retrofit activities keep progressing in close alignment with our customers. No further net material impact was recognized in the first nine months of 2024, and risk still remains on qualification of technical capabilities and the so-called associated costs, on aircraft operational reliability, on cost reduction, and on securing the overall volume of aircraft as per the revised baseline.

Let me now take you back to the guidance we issued in June, and the assumptions behind it. For that 2024 guidance, the company assumes there will be no further disruptions to the global economy, to air traffic, to the supply chain, to the company's internal operations, or to the company's capacity to deliver products and services. The 2024 guidance is set before M&A and therefore before any outcomes from the ongoing due diligence with Spirit AeroSystems. On that basis, the company is targeting — as issued in June in 2024 — around 770 commercial aircraft deliveries, an EBIT Adjusted of around EUR 5.5 billion, and a free cash flow before customer financing of around EUR 3.5 billion. To wrap up with the key priorities, which are quite steady: our commercial aircraft ramp-up and the defense and space transformation, as I mentioned earlier, are today the areas of focus and are also the enablers for our objectives. On defense and space, I told you in July that I would not take my eyes off the case before it is fixed. I stick to this. We did reach an important milestone by initiating the workforce adaptation plan, and we have, as I said earlier, engaged with our social partners on that matter, so we are on our way.

When it comes to commercial aircraft, we're moving ahead with focus and determination—and that focus is on what we see as most important. The lead initiative at commercial aircraft was created precisely for this. It's about ranking what we do, placing priorities on top of priorities, as I like to say, directing our resources, and building up our teams' skills so we can push operational efficiency further, which is what we need. With that said, and I think the time has come, Hélène, I'll pass things to you since we're ready for your questions. Thank you.

Thanks, Guillaume. We’re moving into the Q&A portion now. When you ask a question, please say who you are and which company you’re with. Kindly keep it to 2 questions at once, and that counts sub-questions too. And as always, please speak clearly and at a slower pace so that everyone on the call—especially us—can follow what you’re asking. So, Sharon, please go ahead and walk the participants through the procedure.

Thanks. We're moving into the Q&A portion now. To pose a question, hit star 11 on your phone's keypad — star 11 is what you press to ask. We'll take our first question now. Just a moment. Our first question is from Ross Law at Morgan Stanley. Go right ahead.

Good evening, everyone, and thanks so much for taking my questions. I have three if I may. First, regarding the delivery guidance, what range is implied by that figure of around EUR 770? Does that mean 10 aircraft, 20 aircraft, or perhaps more? And what gives you confidence that you'll hit that level, given that you're not building gliders? My second question is on the A320. You reiterated rate 75 in 2027, but I believe Christian Scherer mentioned 2027 to 28 in a recent media interview. Is that a softening of the message here? And finally, on space, how far through the audit are you now, and what have the findings been since the first half? Thank you.

Thanks for those questions. Yes, in that instance, roughly 770 was the figure we'd previously used as the phrasing for "around." So I can't say precisely what it denotes. My sense is that within a ±20 band, we'd land inside that "around." A year ago we handed over 735, while guidance stood at approximately 720. So you can see it sits within that ±20 aircraft span, which for me captures the order of magnitude of what "around" signifies when it comes to delivery counts. A320 rate 75 is to be attained in 2027. So perhaps Christian was referring to a full year at rate 75 being 2028, since we'll hit 75 during 2027. And clearly, we're at the end of 2024, so as you'd expect, there's some latitude regarding precisely when in 2027 we'd get to 75. What I mean is, right now in 2024 we're wrestling with more practical matters in order to reach the 770 we spoke about earlier. The space audit — well, an audit is one piece of it. What matters most, I believe, is the effort the team is putting in on the one program that carries a major impact, and whose analysis — audit is perhaps the term we sometimes employ — amounts to a complete assessment of that program from top to bottom and bottom to top, involving replanning, a deep-dive analysis of every single work package that constitutes the program along with the time it requires, supplier evaluations, resource levels, the capacity to deliver, and likewise the profitability of every individual delivery, and so arriving at a full assessment of that program's EAC.

This is going to be finished before this year is over. That's what I believe I mentioned in the brief a little earlier, and that is truly the response I'd like to give on that point. And I'm glancing at Thomas. Anything to add?

I'd say we're making solid headway on evaluating the program, though as you can imagine—and as Guillaume mentioned—it's quite complex, since you need to review the whole estimate at completion. That covers the full supply chain, our internal procedures, and so on, plus, naturally, the market perspective as well. So for that reason, providing any interim figure just isn't feasible, but we're quite confident that before the year is out, we'll have finished assessing this program too, and at that point the space story, together with our assessments of where we stand, should be wrapped up.

Got it. Thanks, Guillaume. Thanks, Thomas.

Thanks. The next question is from Chloé Lemarié at Jefferies. Please go ahead.

Good evening, and thanks for taking my questions. I have two, if I may. The first concerns Airbus Commercial performance—if I could dig into that, specifically the lead initiative's impact in Q3 and what you'd expect in Q4, but also on possible compensation impact. So, whether you've been receiving compensation from certain suppliers, whether you've been paying compensation to some of your customers, and how we should think about this affecting Q3 and perhaps Q4. And the second one is still on space. I mean, we understand this is a challenged sector at the moment, but I mean, what could be done to help the sector if there's too much opposition to consolidation within Europe? Thank you.

You can go ahead and handle that first one.

Okay, I'll begin with the lead program. We obviously announced it during the summer alongside our H1 results, and things are moving along well. Let me briefly remind everyone what it involves. This isn't a restructuring effort; rather, it's an initiative in which we refocus the whole organization on the things that matter most — chiefly the ramp-up. Naturally, that also means we deprioritize projects and initiatives that might just pull the organization's attention away from precisely that ramp-up and from our supply chain focus. So we are not laying off people. Doing that would make absolutely no sense. Yes, we pre-hired a lot of people over the last year, but doing so is necessary and sensible, because we don't want to create our own bottlenecks. So again, it's much more about revisiting a long list of projects and initiatives and refocusing the organization. What impact should that have for the full year? I'd roughly quantify it as a couple of hundred million in positive effects. But let me state very clearly that this only counterbalances other negatives, which of course we have — namely a high level of staffing, and also the inflation — and so, to be very clear, it's offsetting negatives that otherwise we would have faced in 2024.

Regarding space, there are lots of ways to approach this, so to speak. When it comes to satellites, our space work spans a diverse range. We have telecoms, civil telecoms, MilSatCom, exploration, science, and Earth observation. So it's a collection of distinct segments. Ideally, we find solutions that span every segment, but we could also find solutions that are somewhat subscale. In fact, it begins with us. We have taken on and been onboarded into programs or contracts where the risk level we accepted in those programs was significantly higher than what we could digest. So that's another thing we're working on. We're re-baselining how we go to market with far more discipline in how we offer a new bidding approach that applies to defense and space, but especially to space. It's fixing those programs. It's resizing and readapting the space business to what we can do profitably. And obviously there's some downsizing we're doing, and especially cost reduction when it comes to what's impacting the profitability of our programs. And beyond what I said at the beginning, well, there is potential for consolidation in Europe.

We must follow the regulations that apply in Europe. Right now, there's a real desire across Europe to examine sovereignty and to examine the capacity to build in defense specifically—though not exclusively—companies of a scale that will allow, that will make competition beyond Europe with non-European players healthier. So there are plenty of chances to move ahead. Above all, we're focused on what sits entirely within our control, and after that we're considering other possibilities, among them—though not only—consolidation within Europe.

Quickly, on your second question, I'd like to skip that one. You asked about supplier compensation. As we mentioned on our first half call, yes, we are extremely strict about requesting compensation when suppliers fail to honor the agreements we have. Of course, though, that's a second-best solution. What we're after is the deliveries. But yes, I can say we are very, very strict in seeking compensation where that's appropriate. Ultimately, of course, we're working to find constructive solutions for Airbus, because getting the deliveries is far better than filing claims against your supply chain.

Thanks. But to revisit the compensation issue, we shouldn’t anticipate any material compensation being paid to your customer in Q4. That’s the way we should think about it.

Regardless of whether it's Q3, Q4, or the following year, whenever we're running behind, there's invariably a conversation with customers, and that depends on what kind of delays they are and where they come from. They find themselves in the very position Thomas described to us—the one we face with our own supply chain. And as we go forward, we have a stream of compensation arriving from suppliers. With two suppliers in particular, we've been in a hard spot for nearly a year now. Last year it improved, but this year has been a difficult one. And the two sides irritate each other somewhat. When equipment from our suppliers does arrive late, we end up delivering late, and you can imagine there's a set of compensation flowing in both directions. So we don't make a living off compensation, and there is no better business case than not delivering. For Airbus, it is always preferable to be delivering net of whatever LDs we may potentially owe our customers, compared with what we receive from our suppliers.

That’s great. Thanks so much.

Thanks. Victor Allard from Goldman Sachs has the next question. Victor, please go ahead.

Thanks for taking my questions, and good evening, everyone. For the first question, I was hoping you could give us an update on how you see the shape of the ramp-up platform in the coming years, given the visibility that you have today. I guess where I'm coming from is hearing from you, Guillaume, and looking at the press release this evening, you have noted that specific challenges on the A350, which may have an impact on the trajectory for 2025. So, any qualitative color that you have here would be helpful. And the second question is on inflation. So, we've seen the GIFAS and the Banque de France report on the state of the French supply chain, at least in Q3. There are still many suppliers struggling indeed. So, is that something which holds you back today to revise your view on inflation and to provide more color on its evolution looking into next year and beyond? Thank you.

I can address the inflation question. I'd like to restate what we concluded earlier in the year: for 2024 we still anticipate a negative impact of a couple of hundred million from inflation, a bit lower than last year's figure. Inflation is plainly easing. It isn't a major swing factor in our projections for year-end. As I mentioned before, we're offsetting those inflation effects, and beyond that, naturally, the elevated staffing levels we have, through our efficiency program, the lead program, where our aim is to concentrate on the projects and matters that count most. On inflation, I'd say there's no significant news. Our view hasn't shifted during the past three months.

To maybe finish answering your question, you're pointing to the Banque de France study, which we actually examined closely at GIFAS. I think it's quite interesting to compare 2023 with 2019, for both large companies and smaller SMEs, and to have a lot of, I mean, the majority of companies back where they stood in 2019 from an economic standpoint, but probably with degraded balance sheets and a more challenging financial situation. That gives an indication of the kinds of problems that need tackling, and with the ongoing initiative to have a second so-called IRO fund to be able to act, to intervene, to support with equity and reinforce the supply chain. That's for the French supply chain. Now, when it comes to your question, your first question on the shape of the product ramp-up, well, that's not something we're doing in detail. We'll give an indication probably at the beginning of next year on what we intend to do next year, the potential guidance at the start of the year. That's what we'd like to be doing, but we're not there yet. Indeed, I flagged the 350 because we already see that a sort of linear ramp-up from 2023, 2024 to 2028 is not what we will get.