EADS Financial Strategy: A Look to the Future

Transcription

1 EADS Financial Strategy: A Look to the Future Hans Peter Ring (CFO) North America Investor Forum 2004 New York December 3rd, Maturing with New Momentum Post Merger Phase 2000 Group Integration 2004 Merger Integration DS and Space restructuring European consolidation Airbus MBDA Astrium New Program Development A380, A318, A /00 A400M Tiger, NH90 Eurofighter Meteor, Taurus, Aster Ariane Euro Star 3000 Strengthen Global Leadership Growth : Airbus: market recovery and A380 Defence expands Space turnaround Delivery and Export of new Programs and Systems Expand Business Boundaries Services Homeland Systems Global Industrial Strategy US, Russia, Japan, China, S. Korea, India Towards a double digit margin company 2 1

2 EADS: a Global Leader. Boeing EADS LM NG BAE Raytheon GD Thales* FM* L3 Dassault Saab EADS Boeing BAE LM Revenues No ,9* NG GD Raytheon FM* Thales* Saab L figures for Aerospace & Defence activities In bn (1$ = ; 1 = 0.691, 1 SEK = ) Orderbook No. 1 *Reported backlog of firm contractual orders Thales & FM backlogs are estimated with leadership in all segments Helicopters (Eurocopter) Satellites (Astrium) 1st 3rd 1st 1st 2nd 4th 3rd Commercial MTA (Airbus)Strategy: A Future Look Aircraft EADS Financial Commercial Launchers (Ariane) 3 Missiles Military Aircraft (MBDA, LFK) Portfolio Balance and EBIT Growth EBIT* CONTRIBUTION in millions over ** 200 2, ,0% 30,0% Airbus ,0% AE, DS, MTA, HQ, Space ,0% ,0% * pre goodwill and exceptionals ** 2004 updated Guidance 2003 %-share of AE, DS, MTA, HQ, Space of total EBIT* result 2004E 4 2

3 A History of Delivering on Promises EADS promised Book-to-bill over one EBIT* +1% from 2000 Revenues +20% from 2000 Free Cash Flow ~0 EADS promised Book-to-bill over one EBIT* of 1.4 bn Revenues stable Net cash position slightly positive.and achieved > % + 21% 0.8 bn.and achieved bn 29.9 bn 1.2 bn 2003 EADS promised Book-to-bill > 1 EBIT* ~ stable from 2002 Revenues ~ stable from 2002 FCF pre-customer financing >0.and achieved > % 30.1 bn 2.1 bn Heightened Trust in our Future EADS * BOEING MSCI WORLD AERO/DEFENCE th Sept FY 2003 Earnings Base 100 : July 10, EADS IPO A380 Go- Ahead Iraq & SARS H Earnings 20 JA SONDJFMAMJ JASONDJ JMAMMJ JA SONDJFMAMJ JA SONDJFMAMJ JA SO * EADS stated in US$: adjusted at daily US$/ UR rate 6 3

4 Air Traffic: Recovered and Growing January-August : 2004 vs January-August : 2004 vs % +19% +12% +17% +1% +1% +14% +8% +2% +% International Passengers Passengers Europe Passengers North America Passengers Asia Cargo 2004 January-July Load factor at 74.% (+ 1.0 pts. above 2000) Source: IATA 7 A380 : Happening Now! 129 firm orders + 10 commitments Targeted IRR 20% +/- 1% Breakeven : 20 A/C +/- 10% Key assumptions: US$/ : 1.12 Expected deliveries: 71 A/C Industrial launch Detail design complete First Metal Cut Final assembly start First Flight Entry Into Service 19th Dec 2000 End 2001 Jan nd Qtr 2004 Early 200 2nd Qtr

5 Dealing with the US Dollar Expected Deliveries Expected Exposure (w/o Route 06) (with Route 06) Hedged Exposure Net Exposure - % depends on Volume and Mix 9 Defence Business Expansion Defence and Homeland Security* Order Backlog Evolution in bn 22 bn YE bn YE 2003 Expected 2004 ~ 49 bn ** YE e2004 * Businesses contracted with government bodies ** Subject to Eurofighter TR2 booking 2004 Recent Achievements (booked): NH90 to Oman US Border Control EC120 : $7m Paradigm with first SatCom export contract to Portugal Key orders in the 2004 pipeline Eurofighter Tranche 2 M1 Series Romanian Border Surveillance Further prospects beyond 2004 Defence Platform Business MRTT Tanker to Australia and UK NH90 to Australia Lead System Integration NATO AGS TIPS down selection MEADS Germany MilSatcom 10

6 Space: Poised for Profitability Space EBIT* PROFIT BREAKEVEN e2004 e200 (222) m (268) m Restructuring charge * pre goodwill and exceptionals (400) m 12,000 10,000 8,000 6,000 4,000 2,000 0 Space order-book in m 3,796 3,89 7,888 10, sept-04 Order-book boosted by : Paradigm order ( 3.2 bn) 30 Ariane order ( 3 bn) Telecom & Observation satellites 11 Accelerating Globalisation & Strategic Markets US EADS NA Defence Company founded - Transatlantic partnerships: NATO AGS, Eurohawk, MEADS, BMD - Racal Instruments 100% - Tanker Team in place Airbus: Design Office Wichita, KS American Eurocopter: plant Mississippi, PRV with NG Long Term Market Access, Cost advantage, Technology access, Natural currency hedging Russia Airbus Design Center, Kaskol EADS: Research Center India Airbus: HAL, Infosys License with BDL (Milan) and HAL (Alouette/ Lama) Partnerships (MoU signed) with BDL (MBDA) and HAL (EC) Galileo interest China EADS % in AviChina Airbus: Sourcing targets raised Engineering center EC: EC120 co production, Strategic agreement with Avic II Astrium: JV Euraspace with CASC, Asiasat partnership, Galileo interest Japan EC: 10% of Euroheli with Sony and Kawasho, KHI for BK117 Airbus: Jamco, MHI, KHI, FHI A380 supplier Space: MHI, IHI, Nissan, Melco cooperations South Korea Airbus: Korean Air and KAI Space: Cooperation with KARI and KAI Australia Australian Aerospace 100% - Tanker, Tiger, NH

7 2004 Targets Display Profitability Growth Revenues in bn EBIT* in bn EBIT* in % of revenues ~6.9% 30.8 vs $ ~32 ~1.2.% % 1.4.1% 1. ~ Target Target 2004 Free Cash Flow before Cust. Financing expected above 10m Book-to-bill ratio confirmed above 1.0 * pre goodwill and exceptionals 13 Racal Acquisition - Business Case EADS has become the world leader in the $22 billion instrument and testing services industry Creates a strong capability to leverage the full spectrum of testing systems and services for our military and civil aerospace customers Growth is expected to be a healthy 10% per year Combining customer bases will facilitate common solutions and upgrades 14 7

8 EADS Goal: Retain Single A Rating 1 S&P Global Aerospace & Defence Long-Term ratings as of Sept AAA AA A BBB BB B CCC CC D S&P Global Aerospace & Defence Outlook as of Sept Negative Stable Positive Developing Watch Neg. S&P Moody's Fitch Long-term rating A (Outlook stable) A3 (Outlook stable) A (Outlook stable) Source: S&P Industry report card Sept EADS Financial Strategy: A Look to the Future Hans Peter Ring (CFO) North America Investor Forum 2004 New York December 3rd,

9 Financial Strategy: EBIT nearly doubles 9m m 2003 Revenues of which Defence 21. bn 4.2 bn 18. bn 3.6 bn EBIT* 1. bn 0.8 bn FCF before Cust. financing** Net Income New orders 0.1 bn 0.6 bn 20.6 bn (0.1 bn) 0.2 bn 49. bn FY bn 7.1 bn 1. bn 2.1 bn 0.6 bn 61.2 bn Net Cash position Total Order book of which Defence Sept bn bn 4. bn Dec bn bn 4.7 bn * pre goodwill and exceptionals ** excl. investments (disposal) in medium term securities and consolidation changes Net Income is reported in compliance with IFRS 3: goodwill is not amortized linearly but tested for impairment at least annually; 2003 figure is restated for comparison 17 9