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European planemaker Airbus axed its dividend for a second year and forecast flat deliveries in 2021 as it braces for more coronavirus uncertainty in the wake of an annual loss.

The company’s decision to restore key business targets is the latest evidence of a tentative return towards normal after the pandemic, which has severely hurt air travel.

Rival Boeing has yet to set out detailed targets, having been mired in a separate crisis over the grounding of its 737 Max, which helped Airbus to reclaim the title of largest global jetmaker.

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However, several analysts warned that the deliberately cautious delivery forecast from Airbus jarred with the company’s more optimistic plans on production. These call for a partial recovery later this year, albeit more slowly than first planned.

The risk, they said, is that this would add to a surplus of almost 100 planes parked outside Airbus factories.

Shares in Airbus were down 2.1% at 1230 GMT.

Chief Executive Guillaume Faury said the forecast for “at least” 566 jet deliveries, unchanged from last year when production had fallen 40%, gave investors some visibility. The actual level will depend on demand from airlines, he added.

Most analysts had predicted more than 600 deliveries, allowing Airbus to reduce the stockpile.

“We remain cautious about the pace at which the airline industry can rebuild its balance sheet to the point where aircraft demand rises significantly,” Jefferies analyst Sandy Morris wrote.

Faury defended the decision to target fewer deliveries than number of planes in its production schedule, saying its planners are torn between a worsening short-term situation and the prospect of vaccine-driven demand improvements later this year.

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But Airbus indicated that a tipping point at which people start to travel again and airlines take more jets is a matter of when, not if.

ORDER BOOK HIT

In a sign of the strain on airline finances, Airbus sliced €100-billion ($120.5-billion), or 20%, off the value of its order book to €373-billion.

While the coronavirus crisis has raised doubts over the ability of some airlines to honor contracts, Airbus said the decrease also reflected lower orders and a weakening dollar.

Airbus posted a 2020 operating loss of €510-million, weighed down by charges booked in previous quarters, notably for restructuring and the closure of the loss-making A380 program.

On a widely watched adjusted basis, operating profit fell 75% to €1.7-billion as revenue slumped by 29% to €49.9-billion.

For 2021, Airbus predicted adjusted operating profit of €2-billion.

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Stronger than expected jet deliveries in the fourth quarter helped Airbus to generate €4.9-billion in cashflow before M&A and customer financing, beating its quarterly break-even target.

Airbus also drew a line under past efforts to spin off aerostructures units in France and Germany and prepare them for sale. Industry sources say few buyers came forward and Faury said such activities were again deemed “core” - especially as Airbus ponders the complex, clean designs of the future.

He said it is too early to say whether the 2009 carve-out would be reversed, a move that typically removes management layers.

Airbus is about halfway through cutting 15,000 staff in its biggest ever restructuring.

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