Financial Statements 2021

2. Notes to the IFRS Consolidated Financial Statements / 2.7 Capital Structure and Financial Instruments

The net cash position on 31 December 2021 amounted to €7,643 million (2020: €4,312 million), with a gross cash position of €22,683 million (2020: €21,407 million). Derivative instruments recognised on the Company’s Statement of Financial Position consist of (i) instruments that are entered into as hedges of the Company’s operating activities or interest result, and (ii) embedded foreign currency derivatives that arise 36.1 Cash and Cash Equivalents Cash and cash equivalents are composed of the following elements:

from separating the foreign currency component from certain operating contracts. Cash flows resulting from the settlement of these derivatives are therefore recorded as part of cash flow from operations. Similarly, financial assets and liabilities arising from customer financing activities and refundable advances from European Governments are considered part of operating activities and related cash flows are hence recognised as cash flows from operating activities.

31 December

2021 1,964 12,075

2020

(In € million)

Bank account and petty cash

4,173 9,654

Short-term securities (at fair value through profit or loss)

533

512 100

Short-term securities (at fair value through OCI)

0

Others

Total cash and cash equivalents

14,572

14,439

Only securities with a maturity of three months or less from the date of the acquisition, that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, are recognised in cash equivalents. Cash and cash equivalents have increased by € +0.2 billion from € 14.4 billion at 31 December 2020 to € 14.6 billion at 31 December 2021 and they include payments received in Cash provided by operating activities amounted to €+4.6 billion in 2021, mainly driven by a profit translated into cash partly offset by provision consumption related to the restructuring plan, a positive impact from working capital which mainly reflects the delivery of the last A380 aircraft and the reduction in the widebodies inventory largely offset by a negative impact from contract assets and contract liabilities. In addition, it includes the net payment made to suppliers in anticipation and the negative impact due to the expiry of certain agreements reached with suppliers relating to payment terms. Cash used for investing activities amounted to €-2.7 billion, mainly reflecting capital expenditures and securities. The acquisition of real estate assets in the UK has negatively impacted cash used for investing activities, and also negatively impacted cash used for financing activities relating to the repayment of the existing lease liabilities. Cash used for financing activities amounted to € -2.2 billion and reflects the pre-payment of a US$1 billion bond issued on 9 April 2013 and the repayment of the exchangeable bonds convertible into Dassault Aviation shares for an amount of €1.0 billion. Similar to previous years, the Company has supported its suppliers concerning supply chain financing arrangements. 36.2 Securities The majority of the Company’s securities consists of debt securities and are classified at fair value through OCI (see “– Note 37.2: Carrying Amounts and Fair Values of Financial Instruments”). advance from certain customers. The main variations are as follows:

The Company’s securities portfolio amounts to €8,111 million and €6,968 million as of 31 December 2021 and 2020, respectively. The security por tfolio contains a non-current por tion of €6,794 million (2020: €5,350 million), and a current portion of €1,317 million (2020: €1,618 million). Included in the securities portfolio as of 31 December 2021 and 2020, respectively, are corporate and government bonds bearing either fixed rate coupons (€7,866 million nominal value; 2020: €6,714 million) or floating rate coupons (€103 million nominal value; 2020: €108 million), and foreign currency funds of fixed income funds (€2 million fair value; 2020: €2 million). When the Company enters into securities lending or other financing activities that involve the pledging of securities as collateral, the securities pledged continue to be recognised on the balance sheet. As of 31 December 2021, securities for an amount of € 0 million were pledged as collateral for borrowings from banks (2020: €99 million). 36.3 Financing Liabilities Financing liabilities comprise obligations towards financial institutions, issued corporate bonds, depositsmade by customers of Airbus Bank, borrowings received from joint ventures and other parties as well as finance lease liabilities. Financing liabilities are recorded initially at the fair value of the proceeds received, net of transaction costs incurred. Subsequently, financing liabilities are measured at amortised cost, using the effective interest rate method with any difference between proceeds (net of transaction costs) and redemption amount being recognised in total finance income (cost) over the period of the financing liability. Financing liabilities to financial institutions may include liabilities from securities lending transactions. In securities lending transactions, the Company receives cash from its counterparty and transfers the securities subject to the lending transaction as collateral. The counterparty typically has the right to sell or repledge the securities pledged. The amount of cash received is recognised as a financing liability. The securities pledged are not derecognised, but remain on the Company’s Statement of Financial Position.

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Airbus / Financial Statements 2021