European aerospace giant Airbus on Tuesday reported a slump in first-quarter net profit, hit by Germany's freeze on weapons exports to Saudi Arabia and its own decision to stop building the loss-making A380 super-jumbo.
It said profits were down 86 per cent from the same period in 2018 at 40 million euros (USD 45 million).
It blamed "adjustments" including "a negative 190 million euros as a consequence of the prolonged suspension of defence export licences to Saudi Arabia by the German government".
Germany in late March extended by six months an embargo on weapons exports to Riyadh.
It had instituted the ban on arms sales to Saudi Arabia and other countries involved in the Yemen war last October in response to the murder of Saudi journalist Jamal Khashoggi at the Saudi consulate in Istanbul.
But Berlin has since faced protests by EU partners because the ban has impacted joint defence projects such as the Eurofighter and Tornado jets.
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Airbus is affected by the freeze under a contract for "border security" equipment, the group's chief financial officer, Dominik Asam, told a press conference Tuesday.
"We now have to watch what is happening in the political environment and how we deal with the customer", he said.
Airbus on Tuesday also blamed falling profits on "83 million euros relating to the dollar pre-delivery payment mismatch and balance sheet revaluation" and "a negative 61 million euros related to A380 programme cost".
Airbus announced in February that it would stop building the A380, a double-decker jet which earned plaudits from passengers but failed to win over enough airlines to justify its massive costs.
The programme's future had been in doubt for years as Airbus slowed production, and the company acknowledged last year that the A380 would be scrapped if no new orders came in.
Consolidated revenues increased 24 percent to 12.5 billion euros "reflecting the higher commercial aircraft deliveries as the production ramp-up continued", it said in a statement.
"The first quarter underlying financials mainly reflect our commercial aircraft ramp-up and delivery phasing," said CEO Guillaume Faury.
"The commercial aircraft market remains robust and we continue to see good prospects in the helicopters and defence and space businesses. The new management team is in place and focused on delivering on our commitments."
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