Kepler Cheuvreux Autumn Conference. Paris. 17 September

Transcription

1 Kepler Cheuvreux Autumn Conference Paris 17 September

2 Thales at a glance FY 2014 sales FY 2014 EBIT (*) 13.0 billion euros FY 2014 sales by segment Defence & Security 50% Aerospace 39% Order intake 2015 objectives Growing, beyond the high level reached in 2014 Higher emerging markets contribution 1.1 billion euros (**) Sales Low single digit growth Employees (*) Non-GAAP measure - Income from operations; plus the share of net income or loss of equity affiliates less: amortisation of intangible assets acquired (PPA) (**) Excluding the impact of the 35% share of net esult of DCNS (***) Based on foreign exchange rates as of February ,000 Global presence 56 countries FY 2014 sales by geography Emerging Markets 23% Australia 5% North America 11% Other Europe 23% Transport 11% France 26% United Kingdom 10% EBIT (*) 1,130-1,150m (***) Sales EBIT (*) margin 2017/18 objectives Moderate growth %

3 H key figures m Order intake Sales +19% 6,224 m +11% 6,347 5,220 5,695 H H H H EBIT (a) m m % Free Operating Cash Flow H (b) H H H (a) Non-GAAP measure: see definition in appendix (b) In this presentation, H EBIT has been restated to take into account the introduction of IFRIC 21

4 Strong order intake increase in emerging markets Emerging markets 1,651m 32% Middle East 13% RoW 6% France 20% Emerging markets 2,492m 40% Middle East 27% RoW 2% France 20% Asia 13% H UK 11% H UK 8% Australia/ NZ 7% North America 8% Other European countries 22% Asia 11% Australia/ NZ 6% North America 9% Other European countries 17% Emerging markets: Orders +51% / book-to-bill =

5 Summary P&L: from sales to EBIT m H H total change organic Sales 6,347 5, % +6% Gross margin 1,520 1,399 +9% +4% in % of sales 23.9% 24.6% Indirect costs (1,064) (998) +7% +2% in % of sales 16.8% 17.5% o/w R&D expenses (310) (286) +9% +4% in % of sales 4.9% 5.0% o/w M&S expenses (495) (456) +8% +4% in % of sales 7.8% 8.0% o/w G&A expenses (259) (256) +1% -5% in % of sales 4.1% 4.5% Restructuring costs (43) (53) -19% -19% in % of sales 0.7% 0.9% Return to organic sales growth Continued EBIT improvement Share of net result of equity-accounted affiliates excl. DCNS % -5% EBIT (a) excl. DCNS % +11% in % of sales 7.3% 6.9% Share of net result of DCNS EBIT (a) % +10% in % of sales 7.5% 7.1% (a) In this presentation, "organic" means "at constant scope and exchange rates" (b) Non-GAAP measure: see definition in appendix. 5

6 EBIT by segment m H H total change organic Aerospace % % +11% +3% Transport (39) -6.9% % N/M N/M Defence & Security % % +33% +26% EBIT (a) - operating segments % % +11% +4% Other (22) (46) EBIT (a) - excl. DCNS % % +18% +11% DCNS (35% share of net result) EBIT (a) - total % % +18% +10% Strong performance of Aerospace and Defence & Security Project execution issues in Transport 6 (a) Non-GAAP measure: see definition in appendix.

7 Summary P&L: from EBIT to adjusted net income m H H EBIT (a) Impairment of non-current operating assets 0 0 Cost of net financial debt and other financial results 7 (13) Finance costs on pensions and other employee benefits (35) (38) Income tax (109) (86) Adjusted net income (a) Minorities (23) (22) Adjusted net income, Group share (a) Adjusted net income, Group share (a), per share (in ) Adjusted net income up 29% on the back of improved EBIT and lower finance charges 7 (a) Non-GAAP measure: see definition in appendix.

8 Cash flow m H H Operating cash flows before WCR changes Change in WCR & contingency reserves (697) (824) Payment of contributions / pension benefits (60) (56) Financial interest paid 10 (4) Income tax paid (42) (44) Net cash flows from operating activities (106) (347) Net operating investments (198) (188) Free operating cash flow (a) (304) (535) Positive impact of downpayments on export contracts 8 (a) Non-GAAP measure: see definition in appendix.

9 Movement in net cash m Net cash Free operating cash flow H Free operating cash flow H Deficit payment UK pensions Disposals/ acquisitions Dividends FX Stock options Other Net cash Improved FOCF, strong net cash position 9

10 2015 priorities: a mid-year review What we said in February Ambition Boost actions across all businesses and countries Fixing issues in Transport Monitoring and supporting DCNS recovery Deliver top line growth Accelerate our globalisation Status Ambition Boost delivers: EBIT (a) up 18% while keeping sustained R&D and commercial efforts Comprehensive contract portfolio review by new management team Recovery plan underway, drawing on resources from Aerospace and Defence & Security DCNS on track to deliver breakeven performance in 2015 Sales up 11% vs. H EM orders up 51%, EM sales up 26% vs. H (a) Non-GAAP measure: see definition in appendix.

11 2015 objectives Order intake Sales EBIT (a) Growing beyond the high level reached in 2014 Higher emerging markets contribution Low single digit growth 1,130-1,150 m (b) Objectives confirmed 11 (a) Non-GAAP measure: see definition in appendix (b) Based on foreign exchange rates as of February 2015

12 Appendix

13 Upcoming events Q3 and 9m 2015 sales 21 October annual results 24 February

14 Aerospace: H key figures m H H change total organic Order intake 1,849 2,077-11% -16% Sales 2,511 2, % +5% EBIT (a) % +3% in % of sales 8.9% 9.1% Lower orders in Space after strong intake in H Top line growth driven by commercial avionics 14 (a) Non-GAAP measure: see definition in appendix.

15 Transport: H key figures m H H change total organic Order intake 1, % +80% Sales % -6% EBIT (a) (39) 11 N/M N/M in % of sales -6.9% 1.9% Strong order intake momentum Project execution weighs on profitability, action plan underway 15 (a) Non-GAAP measure: see definition in appendix.

16 Defence & Security: H key figures m H H change total organic Order intake 3,152 2, % +22% Sales 3,229 2, % +9% EBIT (a) % +26% in % of sales 9.3% 7.9% Growing order intake (Rafale/Egypt) Higher profitability driven by top line growth and good project execution 16 (a) Non-GAAP measure: see definition in appendix.

17 H sales by destination m H H total change organic France 1,569 1,610-3% -3% United Kingdom % -8% Other European countries 1,263 1,232 +2% +1% Europe 3,470 3,463 +0% -2% North America % +15% Australia/NZ % +7% Asia % +2% Middle East % +61% Rest of the world % +24% Emerging markets 1,753 1, % +21% Total 6,347 5, % +6% Asia 13% Australia/ NZ 6% Middle East 10% N America 12% RoW 4% H Other European countries 20% France 25% UK 10% 17

18 H main orders 5,220m 700m +19% 6,224m 1,733m Orders > 100m Rafale (Egypt) Doha metro signalling and supervision (Qatar) 1,655m 1,206m Scout SV land systems (UK) Hong Kong metro signalling systems CERES (France) 2,865m 3,285m Other orders 18 H H Unit value > 100m 10m < Unit value < 100m Unit value < 10m IFEC systems (Middle East) Civil security systems (Middle East) Galileo (ESA)

19 EBIT bridge m % H EBIT (a) Scope and FX Organic operational performance Restructuring charges Pension service costs Add'l expensed R&D Add'l expensed M&S H EBIT (a) Top line growth and efficiency measures drive EBIT increase 19 (a) Non-GAAP measure: see definition in appendix.

20 H adjusted net result m Consolidated P&L H Amortisation of intangible assets (PPA) Disposal of assets and others Change in fair value of derivative FX instruments Actuarial gains/losses on other long term benefits Adjusted P&L H Sales 6,347 6,347 Cost of sales (4,827) (4,827) R&D (310) (310) SG&A costs (754) (754) Restructuring costs (43) (43) Amortisation of intangible assets (PPA) (53) 53 0 Income from operations 360 Impairment of non-current operating assets (*) Disposal of assets, change in scope and others (3) 3 0 Share in net income (loss) of equity affiliates Income of operating activities incl. share in net income of equity affiliates 404 EBIT 473 Impairment of non-current operating assets --- (*) 0 Cost of net financial debt 5 5 Other financial income (expense) (13) 15 2 Finance costs on pensions and other employee benefits (25) (10) (35) Income tax (88) (18) (1) (5) 3 (109) Net income (loss) Minorities (16) (6) (1) 1 (23) Net income (loss), Group share (*) included within "Income of operating activities incl. share in net income of equity affiliates" in the consolidated P&L and within "Net income" in the adjusted P&L

21 H adjusted net result m Consolidated P&L H (proforma IFRIC 21) Amortisation of intangible assets (PPA) Disposal of assets and others Change in fair value of derivative FX instruments Actuarial gains/losses on other long term benefits Adjusted P&L H (proforma IFRIC 21) Sales 5,695 5,695 Cost of sales (4,295) (4,295) R&D (286) (286) SG&A costs (712) (712) Restructuring costs (53) (53) Amortisation of intangible assets (PPA) (27) 27 0 Income from operations 322 Impairment of non-current operating assets (*) Disposal of assets, change in scope and others 225 (225) 0 Share in net income (loss) of equity affiliates Income of operating activities incl. share in net income of equity affiliates 586 EBIT 401 Impairment of non-current operating assets --- (*) 0 Cost of net financial debt (1) (1) Other financial income (expense) (15) 3 (12) Finance costs on pensions and other employee benefits (43) 6 (38) Income tax (73) (9) (1) (1) (2) (86) Net income (loss) (226) Minorities (21) (1) (22) Net income (loss), Group share (226) (*) included within "Income of operating activities incl. share in net income of equity affiliates" in the consolidated P&L and within "Net income" in the adjusted P&L

22 H EBIT by operating segment impact of IFRIC 21 m H reported EBIT (a) H proforma IFRIC 21 Aerospace % % Transport % % Defence & Security % % Other (33) (37) Total % % (a) Non-GAAP measure: see definition in appendix 22

23 Q order intake by sector m Q Q total change organic Aerospace 1,067 1,301-18% -22% Transport % +83% Defence & Security 1,586 1,461 +9% +4% Other 13 3 Total 3,401 3,145 +8% +3% 23

24 Q sales by sector m Q Q total change organic Aerospace 1,430 1, % +6% Transport % -7% Defence & Security 1,985 1, % +19% Other Total 3,770 3, % +11% 24

25 Thales on board Rafale Thales = about 25% of total aircraft value 25

26 Main programmes in backlog Amount Programme More than 600m Between 400m and 600m Between 200m and 400m Rafale (Egypt) Rafale (France) Iridium (USA) Contact software defined radio (France) Mirage 2000 upgrade (India) Meteosat (EU) Doha metro (Qatar) FREMM frigates (France/Italy) Defence communication network (France) In-service support of naval sensors SSOP (UK) FalconEye satellite (UAE) Observation satellite (Africa) Hong Kong metro (China) Signalling programme Fbane (Denmark) 26

27 Thales shareholding structure June 2015 Free float 48.9% o/w Employees 1.9% French State (a) 26.1% Dassault Aviation 25.0% Total share count as of 30 June: 210,162, (a) French State shares are held directly and indirectly through TSA, a 100% state-owned holding company

28 Leadership Team Marc Darmon Executive Vice-President Secure Communications and Information Systems Alex Cresswell Executive Vice-President Land & Air Systems Pierre Eric Pommellet Executive Vice-President Defence Mission Systems Gil Michielin Executive Vice-President Avionics Jean-Loïc Galle Executive Vice-President Space Millar Crawford Executive Vice-President Transportation Systems Patrice Caine Chairman and Chief Executive Officer Michel Mathieu Senior Executive Vice-President Chief Operating Officer and Chief Performance Officer Pascale Sourisse Senior Executive Vice-President International Development David Tournadre Senior Executive Vice-President Human Resources Pascal Bouchiat Senior Exective Vice-President Chief Finance Officer Isabelle Simon Group Secretary & General Counsel Hervé Multon Executive Vice-President Strategy Research and Technology 28

29 Definition of non-gaap measures This presentation contains non-generally Accepted Accounting Principles (GAAP) financial measures. Thales regards such non-gaap financial measures as relevant operating and financial performance indicators for the Group, as they allow non-operating and nonrecurring items to be excluded. Thales definitions for such measures may differ from similarly titled measures used by other companies or analysts. Organic: at constant scope and exchange rates. Book-to-Bill ratio: ratio of orders received to sales. EBIT: income from operations; plus the share of net income or loss of equity affiliates less: amortisation of intangible assets acquired (PPA) Emerging Markets: All countries in Middle East, Asia, Latin America and Africa Adjusted net income: net income, less the following elements, net of the corresponding tax effects: (i) amortisation of intangible assets acquired, (ii) disposal of assets, change in scope of consolidation and other, (iii) change in fair value of derivative foreign exchange instruments (recorded in "other financial results" in the consolidated accounts), (iv) actuarial gains or losses on long-term benefits (accounted within the "finance costs on pensions and employee benefits" in the consolidated accounts). Adjusted EPS: ratio of adjusted net income (as defined above) to average number of shares outstanding. Free Operating Cash Flow: net cash flow from operating activities, less: capital expenditures, less: deficit payments on pensions in the United Kingdom. 29

30 Thales Tour Carpe Diem 31 Place des Corolles Paris La Défense France This presentation may contain forward-looking statements. Such forward-looking statements are trends or objectives, as the case may be, and shall not be construed as constituting forecasts regarding the Company s results or any other performance indicator. These statements are by nature subject to risks and uncertainties as described in the Company s registration document ("Document de référence") filed with Autorité des Marchés Financiers. These statements do not therefore reflect future performance of the Company, which may be materially different.