The Board of Directors of Dassault Aviation approved the 2020 accounts at a Board meeting chaired by Mr. Éric Trappier Thursday. The audit procedures have been completed and the audit opinionis in the process of being issued.
“2020 was an extraordinary year, dominated by the Covid-19 pandemic that plunged the entire world intoa health and economic crisis. This crisis allowed Dassault Aviation to demonstrate the relevance of its dualmodel as well as its resilience ability. Following the initial shock, our organizations have had to adapt byimplementing a robust health protocol to ensure the safety of our employees, and “under crisis remoteworking” for most of them,” Trappier said.
He added: “In this extraordinary context, we focused on meeting our commitments:
- Providing support for the armed forces and Falcon customers
- Completing Rafale Export and Falcon deliveries
- Continuing to develop the Falcon 6X
In addition, some delays were caused by the necessary changes in work organization (workplace shutdown, “under crisis remote working”, sub-contractor delays, etc.).
The aviation sector has been hit hard by the shutdown of a large part of air traffic. The French government has supported the sector through state-guaranteed loans and a furlough scheme. It has also launched a plan to support and modernize the sector in association with GIFAS.
In 2020, Dassault Aviation:
- Received € 6 million of state temporary furlough allowance
- Paid € 1 million to the investment fund out of the € 13 million commitment
- Received € 8 million from CORAC
In these exceptional circumstances, our shareholders have shown their support by waiving their 2020 dividends due in respect of the 2019 earnings.
As guided, we delivered 13 Rafale Export and continued to explore new Export opportunities. This led to the successful sale to Greece, in January 2021, of 18 Rafale (6 new aircraft and 12 aircraft recently put into service with the French Air and Space Force). Following the sale, France announced the order of a further 12 Rafale to replace those to be delivered to Greece.
We also successfully delivered 34 Falcon (despite the travel restrictions), continued working on the Falcon 6X which completed its virtual rollout in December 2020 and that is expected to enter into service in late 2022 and continued to develop the future Falcon to be announced in the first half of 2021.
The 2020 order intake amounted to EUR 3,463 million, versus EUR 5,693 million in 2019. This year, it included the integrated support contract for the Atlantique 2 (OCEAN) for France and 15 Falcon, including the “Albatros” maritime surveillance aircraft program for the French Navy. In 2019, it chiefly comprised the RAVEL contract and 40 Falcon.
Net sales in 2020 amounted to EUR 5,489 million, versus EUR 7,341 million in 2019. This reduction, as planned, is mainly due to a lower number of Rafale Export deliveries (13 vs. 26 in 2019) and Falcon deliveries (34 vs. 40 in 2019).
Operating margin was 4.8%, versus 10.4% in 2019. It is directly affected by:
- The financial impacts due to the health crisis (under-used capacity, cost of health measures, decline in activity at Falcon maintenance centers, etc.). The savings associated with the action plans implemented by the Group have cushioned these impacts
- The significant level of self-financed R&D, representing 9.8% of net sales, compared with 7.2% in 2019
- Despite the crisis, we aimed at keeping our current developments going, particularly the Falcon 6X and the future Falcon
- Less absorption of fixed costs due to the 25% drop in net sales.
2020 adjusted net income, down 51%, stood at EUR 396 million, representing a net margin of 7.2% of net sales, versus 11.1% in 2019. This decrease is mainly due to the lower operating income and the smaller contribution to net income from Thales.
This result leads to a dividend proposal of EUR 103 million (EUR 12.3 per share) for shareholders and to a payment to employees of EUR 85 million, including the correlated social tax, by way of profit-sharing and incentive schemes.
We continued implementing our transformation plan, and particularly the digitalization of the Company. Digitalization is essential for our processes, from design to support, while mastering our data. We also put emphasize on our industrial performance and on modernizing our infrastructures.
Looking ahead, 2021 will still to be dominated by the pandemic and its consequences for public health and economy. In this context, our efforts and strategy will be:
- Export Rafale: perform contracts and continue to explore new business opportunities
- Falcon: increase sales
- Falcon 6X: continue development with aiming at its entry into service in late 2022
- Military developments: pursue the current programs (F4 standard, Archange, Albatros, etc.)
- Preparation of the future: keep to the schedule for the future Falcon
- New Generation Fighter: obtain the launch of phases 1B and 2,
- Eurodrone: secure a contract
- 5th batch of the Rafale France: prepare for the productability contract
- Aircraft support and availability: maintain the highest standards
- Energy transition: secure CORAC orders
- Make in India: continue developing the activities transferred to DRAL
We plan to deliver 25 Rafale and 25 Falcon. Net sales will increase.