Réal Raymond. Chairman of the Board

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2 Réal Raymond Chairman of the Board 2

3 Agenda 1. Opening of the Meeting 2. Chairman and Secretary 3. Report of Scrutineers 4. Notice of Meeting 5. Minutes of the Annual Meeting of Shareholders Held on August 4, Receipt of the Consolidated Financial Statements for the Year Ended March 31, 2017 and of the Auditors Report 7. Substantive Issues - Introduction 8. Election of Directors 3

4 Election of directors Nathalie Bourque Corporate director Paule Doré Corporate director Gilles Labbé President and CEO, Héroux-Devtek Inc. Louis Morin President of Busrel Inc. James J. Morris Corporate director and consultant Brian A. Robbins President and CEO, Exco Technologies Ltd. Andrew J. Stevens Corporate Director 4

5 Agenda 1. Opening of the Meeting 2. Chairman and Secretary 3. Report of Scrutineers 4. Notice of Meeting 5. Minutes of the Annual Meeting of Shareholders Held on August 4, Receipt of the Consolidated Financial Statements for the Year Ended March 31, 2017 and of the Auditors Report 7. Substantive Issues - Introduction 8. Election of Directors 9. Appointment of the Auditors and Remuneration 10. Completion of the Formal Part of the Meeting 11. President s Report 5

6 Gilles Labbé President and Chief Executive Officer 6

7 Forward-looking statements In the interest of providing shareholders and potential investors with information regarding Héroux-Devtek, including management s assessment of future plans and operations, certain statements in this presentation are forward-looking statements subject to risks, uncertainties and other important factors that could cause the Company s actual performance to differ materially from those expressed in or implied by such statements. Such factors include, but are not limited to: the impact of general economic conditions; industry conditions including changes in laws and regulations; increased competition; the lack of availability of qualified personnel or management; availability of commodities and fluctuations in commodity prices; foreign exchange or interest rates fluctuations; stock market volatility; and the impact of accounting policies issued by Canadian, US and international standard setters. Some of these factors are further discussed under Risks and Uncertainties in the Company s MD&A, but readers are cautioned that the list of factors that may affect future growth, results and performance is not exhaustive, and undue reliance should not be placed on forward-looking statements. Although the Company believes that the expectations conveyed by the forward-looking statements are based on information available to it on the date such statements were made, there can be no assurance that such expectations will prove to be correct. All subsequent forward-looking statements, whether written or orally attributable to the Company or persons acting on its behalf, are expressly qualified in their entirety by these cautionary statements. Unless otherwise required by applicable securities laws, the Company expressly disclaims any intention, and assumes no obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. 7

8 Building a sustainable future Focus on executing our business strategy Maintain solid business relationships with world-class OEMs Solid operating results and strong financial position to take advantage of opportunities $450 Sales relatively stable at $406.5 million Adjusted net income* of $26.4 million Sales (in $ million) $30 Adjusted net income* (in $ million) $300 $20 $150 $10 $ $ * This is a non-ifrs financial measure which does not have a standardized meaning prescribed by IFRS and may therefore not be comparable to similar measures presented by other issuers. Refer to the Corporation s MD&A for further details. 8

9 A sustainable future through proprietary products PROPRIETARY PRODUCTS A sustainable future is driven by more proprietary products Over the past years, sales of proprietary products have constantly progressed: 33% OF SALES 10% of sales before APPH acquisition in February % of sales after APPH acquisition 33% of sales in fiscal 2017 Also includes aftermarket sales for programs where we were involved in the design 9

10 New contract: KF-X Long-term contract with Hanwha Corporation of South Korea to jointly design and develop the landing gear system for the new KF-X fighter aircraft Proves our world-class capabilities in the design and development of complete landing gear systems 10

11 New contract: Gripen E Contract with Saab AB of Sweden for the production of complete landing gear systems for the Gripen E fighter aircraft First flight took place on June 15 on-track for initial deliveries in calendar

12 CH-53K Important progress on the Sikorsky CH-53K heavy lift helicopter Development phase completed Production phase to begin soon 12

13 New contract: Hawk Contract with U.K.-based BAE Systems for the production of complete landing gear replacement shipsets and hydraulic actuators for the Hawk trainer aircraft Attests to the longevity over which revenues from life-cycle design programs can be earned 13

14 Aftermarket activities Important growth avenue as more aircrafts equipped with of our products are put into service. AFTERMARKET & PRODUCT SUPPORT 31% OF SALES Consolidated our European maintenance and repair activities at our Runcorn, U.K. facility Joint proposal to the USAF for the C-130, KC-135 and E-3 aircraft was not retained volume to be progressively reduced during fiscal

15 A sustainable business through growing OEM business OEMs, end customers and distributors Steady growth of OEM business in recent years: 63% of sales in fiscal % OF FISCAL 2018 EXPECTED SALES 71% of sales in fiscal % of sales in fiscal 2018 Since most recent contracts have been signed with OEMs, we anticipate this proportion to further increase as new programs ramp-up 15

16 New contract: KC-390 Expanded the scope of an existing agreement to provide Brazilian aircraft manufacturer Embraer with landing gear components and assemblies for the KC-390 transport aircraft Prime example of our manufacturing flexibility, as production is carried out in Canada, the U.S. and the U.K. 16

17 Boeing 777 and 777X contract Began deliveries of complete landing gear systems for the Boeing 777 and 777X program As of June 30, 2017, we delivered a total of 29 landing gear systems Customer approval required for two surface treatment processes Incurred additional costs due to subcontracting Qualification should be finalized during the current fiscal year Profitability will grow progressively once we get the approval 17

18 Stéphane Arsenault Chief Financial Officer 18

19 Sales in millions of CA$ Sales growth Compound annual growth rate of 9% for the last 10 fiscal years $450 Landing gear sales ($M) $400 $350 $300 $250 $200 $150 $100 $182 $191 $195 $228 $242 $257 $272 $365 $407 $407 $50 $

20 Adjusted EBITDA* in millions of CA$ Adjusted EBITDA * growth $70 Compound annual growth rate of 11% for the last 10 fiscal years Adjusted EBITDA* ($M) $60 $50 $40 $30 $64 $61 $20 $10 $24 $24 $19 $29 $31 $37 $33 $36 $48 $48 $ * This is a non-ifrs financial measure which does not have a standardized meaning prescribed by IFRS and may therefore not be comparable to similar measures presented by other issuers. Refer to the Corporation s MD&A for further details. 22

21 Fiscal 2017 results Fiscal years ended March 31 (in millions of Cdn $) % ch. Sales Currency variations Commercial products % Defence products % Adjusted EBITDA * As a % of sales % % -4.1% Adjusted net income * Per share % Free cash flow * 33.0 (66.3) * This is a non-ifrs financial measure which does not have a standardized meaning prescribed by IFRS and may therefore not be comparable to similar measures presented by other issuers. Refer to the Corporation s MD&A for further details. 23

22 Free cash flow * generation * * Generated free cash flow * except for years in which we carried out our capital investment plan Fiscal 2017 free cash flow * of $33 million or 8% of sales Shows our capabilities to generate free cash flows * in the coming years * This is a non-ifrs financial measure which does not have a standardized meaning prescribed by IFRS and may therefore not be comparable to similar measures presented by other issuers. Refer to the Corporation s MD&A for further details. 24

23 Fiscal 2018 first-quarter results Quarters ended June 30 (in millions of Cdn $, except per share data) Sales Currency variations % ch % Commercial products % Defence products % Adjusted EBITDA * As a % of sales % % % Adjusted net income * Per share % Free cash flow * 0.5 (0.5) * This is a non-ifrs financial measure which does not have a standardized meaning prescribed by IFRS and may therefore not be comparable to similar measures presented by other issuers. Refer to the Corporation s MD&A for further details. 23

24 Financial position (in millions of Cdn $, except ratios) June 30, 2017 March 31, 2017 Cash and cash equivalents Long-term debt * Credit Facility used (authorized amount of $200 million) Net debt Net debt / equity ratio 0.25:1 0.26:1 * Including current portion, but excluding net deferred financing costs. 24

25 Guidance For fiscal 2018, we anticipate a low single-digit sales decrease (in %) Stable adjusted EBITDA margin compared to last fiscal year Capital expenditures of approximately $20 million Sales of $480 to $520 million in fiscal 2021 Excluding any other acquisition 25

26 Commercial sector overview Average annual growth Source: Boeing IATA is forecasting a 7.4% increase in passenger traffic for calendar year

27 Global fleet to double over the next 20 years 50,000 46,950 40,000 30,000 20,000 10,000 23,480 23,470 Growth 57% 17,560 Replacement 43% 41,030 0 Retained fleet 5, Source: Boeing 2017 Current Market Outlook 27

28 Solid industry backlogs 41,030 Aircraft Average of 2,050 per year Order backlogs (June 30, 2017) 28

29 Business jet market 7.9% decline in industry shipments in calendar 2016 and slight increase in the first quarter of 2017 (GAMA) Decline due to contraction in certain key markets, such as Brazil and Russia Héroux-Devtek remains well positioned in this market Current and future ramp-up of certain models, including Embraer Legacy and Dassault Falcon 5X 29

30 Defence sector overview Conditions gradually improving Higher funding in the U.S. from US$585 billion in 2017 to US$639 billion in 2018 Increase in funding in Canada over the next 10 years from $18.9 billion in to $32.7 billion in NATO European member countries defence spending should increase by nearly 4% in 2017 Our operations on both sides of the Atlantic stand to benefit from this greater spending 30

31 Defence sector overview Héroux-Devtek in a good position given its extensive diversification Longstanding, well-established programs: AW-101, Hawk, CH-47, C-130, P3 and C-27 New programs: Gripen E, F-35, CH-53K, KF-X and KC

32 In conclusion Héroux-Devtek is well-positioned to take advantage of opportunities that may arise Ready for acquisitions Cash position of $40 million $245 million borrowing capacity Looking for companies that will enhance our global reach, our product portfolio and our expertise Targets to be mainly active in the landing gear industry or related products 32

33 In conclusion We have proven our world-class expertise Designing and manufacturing new landing gears Building and assembling complete systems, including for large aircraft such as the Boeing 777 Repair and maintenance of existing aircraft As we celebrate our 75 th anniversary, we are a leader in the landing gear industry Thanks to our talented employees for their dedication We are grateful to our business partners for their constant support Thank you, shareholders, for your confidence 33

34 Question Period 34

35 Thank You 37