Financial Statements 2021

2. Notes to the IFRS Consolidated Financial Statements / 2.5 Operational Assets and Liabilities

The Company tested the intangible assets for which an indicator of impairment was identified. In particular, the Company tested the intangible assets associated with some aircraft programmes and concluded that no impairment was necessary. As of 31 December 2021 and 2020, goodwill was allocated to CGUs or group of CGUs and is summarised in the following schedule:

Airbus Defence and Space Eliminations

Airbus Helicopters

Consolidated Airbus

Airbus

(In € million)

Goodwill as of 31 December 2021

10,731

139 139

2,158

0 0

13,028

Goodwill as of 31 December 2020

10,710

2,150

12,999

The goodwill mainly relates to the creation of the Company in 2000 and the Airbus Combination in 2001. The annual impairment tests performed in 2021 led to no impairment charge. Sensitivities were also performed for growth rates (+/-1%) and discount rates (+/-1%), and in both cases led to no impairment charge.

General Assumptions Applied in the Planning Process

Airbus Helicopters – The planning takes into account the evolution of programmes based upon the current backlog and an assessment of order intake for platforms and services. – In the absence of long-term financial reference, expected cash flows generated beyond the planning horizon are considered through a terminal value. – Long-term commercial assumptions in respect of market share, deliveries and market value are based on the latest helicopter market forecast. This market has started to recover in 2021, but is expected to remain a challenging environment due to persistent economic uncertainties lengthening the sales cycle in particular in military due to budget allocation postponement or reduction, delayed growth of emerging markets especially in Asia, and the Oil and Gas downturn. – Cash flows are discounted using a euro weighted pre-tax WACC of 9.3% (2020: 12.8%). Airbus Defence and Space – Overall the defence and space markets are expected to have a moderate growth during the period of the operative planning horizon. – Business growth is underpinned by growing defence opportunities. Underlying per formance is improved by focusing on project delivery, cost control and efficiency. – In the absence of long-term financial reference, expected cash flows generated beyond the planning horizon are considered through a terminal value. – Cash flows are discounted using a euro weighted pre-tax WACC of 8.3% (2020: 10.1%).

The basis for determining the recoverable amount is the value in use of the CGUs. Generally, cash flow projections used for the Company’s impairment testing are based on operative planning. The operative planning, used for the impairment test, is based on the following key assumptions which are relevant for all CGUs: – increase of expected future labour expenses of 3.0% (2020: 1.5%); – future interest rates projected per geographical market, for the European Monetary Union, the UK and the US; – future exchange rate of 1.25 US$/€ (2020: 1.25 US$/€) to convert in euro the portion of future US dollar which is not hedged (see “– Note 37: Financial Instruments”); General economic data derived from external macroeconomic and financial studies have been used to derive the general key assumptions. In addition to these general planning assumptions, the following additional CGU speci f ic assumptions, which represent management’s current best assessment as of the date of these Consolidated Financial Statements, have been applied in individual CGUs. Airbus – The planning takes into account both the current market condi tion and Airbus production rate, and includes management’s best estimates of the progressive increase in aircraft deliveries over the operative planning period. – In the absence of long-term financial reference, expected cash flows generated beyond the planning horizon are considered through a terminal value. – The carrying value and planned cash flows of the CGU Airbus are materially influenced due to the significant hedge portfolio. – Cash flows are discounted using a euro weighted pre-tax WACC of 11.0% (2020: 14.1%).

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Airbus / Financial Statements 2021