Paris Air Show 2011 - SafranParis Air Show, Investors meeting, June 20-26, 2011 Ce document et les...

Paris Air Show, Investors meeting, June 20-26, 2011

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Paris Air Show 2011

/ June 20-26, 2011 /



2

Agenda

è A strategy delivering successn Strategy and end-markets

n Partner of major aerospace programs

è A more agile Groupn Corporate governance & management structure

n Modernization programs

è Investing in the futuren New engines

n New technologies



/01/A strategy delivering success

3



2010 revenue by activities

§ Revenue €10,760M§ Recurring op. income €878M (8.2% of revenue)

§ Net income - Group share €508M (€1.27/share)

§ Free Cash Flow €934M§ Net cash position €24M

A well-balanced portfolio

26 %

12 %52 %

10 %

Aircraft Equipment

DefenceAerospacePropulsion

Security

2010 key adjusted figures

4

Aftermarket services revenue of €4.2bn



An improved business

5

Adjusted rec. operating margin by activity (in %)

(*) Excludes A400M loss at completion (**) Includes PPA amortization

Backlog (in €bn)

Cash from op. activities (in €M)

Delivering results

Propulsion Equipment

10,1%11,1%

11,8%

5%

7%

9%

11%

13%

15%

2008 2009 2010 2011E

2,1%2,6%

4,5%

1%2%3%4%5%6%7%

2008 2009 2010 2011E

Defence Security

4,0% 4,1% 4,4%

1%2%3%4%5%6%7%

2008 2009* 2010 2011E

4,9%

9,5%

12,3%

4%

6%

8%

10%

12%

14%

2008** 2009 2010 2011E

21,9

27,930,4

15

20

25

30

35

2008 2009 2010 2011E

936

1 042

1 142

900

1000

1100

1200

2008 2009 2010 2011E



3-year visibility on Fx

6

3.93.92.8

4.34.0

4.5~ 4.7~ 4.7~ 4.7

0

1

2

3

4

5

2009 2010 2011 2012 2013 2014

è Hedge rates locked-in for 2011 to 2014n 2012: $3.9bn achieved

at $1.34 to rise to $4.6bn at $1.34as long as €/$<1.65 for most of 2011

n 2013: $3.9bn achieved at $1.30 to rise to $4.6bn at $1.30 as long as €/$<1.52 for most of 2011

n 2014: $2.8bn achieved at $1.30 through accumulators and forward sales to rise to $4.5bn at $1.28 as long as €/$<1.52 for most of 2011 and 2012

Hedge portfolio, May 9, 2011

Achieved

Target

1.42 1.44 1.38 1.34

1.34

1.30

1.30

1.30

1.28

Estimated exposure needsIn US$ bn

€/$ hedge rate

Total: $13.8bn



A long-term strategy

security

aerospace

defence

7

High-tech and mission critical solutions



Selective acquisitions

8

Finalised on April 5, 2011

Closing pending CFIUS approval

Finalised on Nov 22, 2010



Intra Europe

+4.3%Intra North America

+2.3%

Intra China

+8%

Intra South America

+6.9%

Intra SEA

+6.8%

NA to EuropeEurope to China

NA to China

Growing market in commercial aerospace

+3.1%+6.4%

+7.6%

9



Preparing for narrow-body OE growth

Airbus A320Boeing 737

10

From 1,260 CFM56 engines in 2010 to just over 1,400 in 2012Introducing CFM56-7BE and CFM56-5B PIP in 2011



Expanding CFM56 installed base

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12E 14E 16E 18E 20E

(Num

ber o

f CFM

engin

es)

Number of CFM engines

2010 : 20,000 engines / 500 million flight hours

2020 : 30,000 engines / 1,000 million flight hours

CFM56 spare parts revenue potentially to double by 2020

11

Increasing aftermarket revenue opportunity



Civil aftermarket - narrowbody lagging widebody

12

CFM56: 2009-10 crisis deeper than 9/11Narrowbody engines stay longer under the wing vs. widebody engines

Global CFM56 spare parts revenueBasis 100 - 9/11/2001Basis 100 - Sept. 2008

~20,000 cycles

0

25

50

75

100

~3,000 cycles

Narrowbody

Widebody

EGT (°C)

Years105 8-9

Civil aftermarket expected to be up 10-15% in 2011 (in $)

2009 2010 2011

60

708090

100110120

130140

2002 2003 2004

After Lehman

After 9/11



Partner of major aerospace programs

13

§ Safran on board: $20-30M (list price, depending on engine)(Compressors for GP7200 engine, Nacelles, Landing and braking system, Nose landing gear, Wiring, Components for onboard information system and flight control system)

§ Order book: 230+ aircraft

èAirbus A380




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èBoeing B787

§ Safran on board: $4-7M (list price, depending on engine)(Fan blades, booster and Fadec on GEnx engine, Landing gear, Wheels and carbon brakes, Electric brake actuation controller (EBAC), Wiring)

§ Order book: 850 aircraft




15

§ Safran on board: $5M (list price)(Integrated landing and braking system, Main landing gear, Wheels and carbon brakes, Fuselage and engine pylon wiring, Components for onboard information system and flight control system)

§ Order book: 570+ aircraft

èAirbus A350




16

§ Safran on board: $15M (list price)(LEAP engine through CFM International, Nacelles, Wiring, Avionics)

èAirbus A320neo (LEAP engine)




17

§ Safran on board: $14M (list price)(LEAP engine and nacelles through CFM International, Wiring)


èCOMAC C919




18

§ Safran on board: €6-7M (list price)(TP400 turboprop engine through EPI, Landing gear and systems, Wheels and carbon brakes, Navigation system, Wiring)


èAirbus A400M



A more agile Group/02/



Recent changes in governance

èAGM approved to replace the former dual structure by an unitary structure with a Board of Directors as of April 21, 2011

èMembership structure of the Board of Directors

n 15 members including 4 representatives of the French State, 5 independent members(incl. 2 members with international credentials)and 2 representatives of employees shareholders

n 1 Board advisor

Focus on new directors• Giovagni Bisignani - Chairman & CEO of IATA• Jean-Lou Chameau - President of CalTech• Odile Desforges - EVP, Engineering & Quality of

Renault• Elisabeth Lulin - CEO of Paradigmes et caetera

Caroline Grégoire Sainte Marie - Chairman & CEO of Frans Bonhomme

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More effective in today’s competitive business environment

More international expertise



A new management structure

Dominique-Jean ChertierDeputy CEO, Corporate Office

Ross McInnesDeputy CEO, CFO

Marc VentreDeputy CEO, COO

Jean-Paul HertemanChairman & CEO

Philippe PetitcolinPresident of Defence Security

Yves LeclèreEVP, Transformation

Jean-Pierre CojanEVP, Strategy

Bruno CottéEVP, International

21



Investing in productivity: €350M

Bordes - June 2010

Queretaro - March 2010

Montluçon - H2 2011

è AGM World class excellence centre in Europe

è Growing low cost & $ base

22



Positioning for profitable growth

23

2010 employees54,300

(*) at comparable perimeter with 2010

Purchases in $ / emerging zones(BUY)

France

International

2005* employees49,900

Investing in high tech and capital intensive facilities in France (Montluçon, Bordes, Massy, Bidos) bringing technological & productivity step-change …

… while continuing to globalize our industrial footprint with opening of 2 new facilities in Mexico in 2010

0%

10%

20%

30%

40%

50%

2004 2005 2006 2007 2008 2009 2010 2011

People

France

International

Production workforce in $ / emerging zones(MAKE)

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

16 000

2001 2004 2007 2010 2012

Emerging zones

$ zones



Improving productivity in equipment

è Grow services (carbon brakes, landing systems, nacelles) as fleet usage continues to pick-up and as installed base continues to grow

è Nacelle activity to provide positive contribution in 2011

è Expected volume recovery from 2011 in business and regional jets

è Continue to improve productivity and reduce cost base

24



Investing in the future/03/



New engines for commercial & corporate jets

LEAP - Narrowbody aircraft

Silvercrest - Corporate jets and other applications

Ardidden 3 - 6/8t helicopters

26



Introducing a new advanced engine: LEAP

è Provides superior performance vs. latest upgrade of CFM56n Burn 15% less fueln Produce 15% less CO2 emissionn Produce 50% less NOxn Reduce noise by up to 15 EPNdB

è Market potential :18,000 enginesn 4,000 A320neo aircraftn 2,000 C919 aircraftn 3,000 B737 aircraft

è R&D investment for LEAP (incl. the nacelle)n Total cash R&D of c.€1bn (Safran’s share for 2011-2016)

LEAPA new baseline turbofan engine to power future replacements

for current narrow-body aircraft

EIS in 2016

27



COMAC C919

Airbus A320neo

LEAP-powered aircraft

28

Proposed Boeing B737



è A 9,500- to 12,000-pound thrust turbofan

è Designed to power super mid-size to large cabin business jets or 40 to 60-seat regional jets

è Designed for environmental performancen Up to 20 EPNdB margin vs. Stage 4

requirementsn 50% margin vs. Caep/6 emission

standardsn 15% lower specific fuel consumption

than current engines

Silvercrest

29

The new generation business jet engine



New technologies for existing fleets

Electric GreenTaxiing System

Electrically-actuatedB787 carbon brake

Electrically-actuated A380 thrust reverser

30

Delivering world-class technology innovations



Electric Green Taxiing System

31

A green and innovative concept

Concept that allows an aircraft to taxi without having to use its main jet enginesn Electric motors located in the wheels on the main landing gear, powered by the APU,

allow the plane to move forward or backward

Main benefits for the airlinesn Up to 4% reduction in block fueln Significant reduction in ground emissions (CO2, Nox)n Eliminates the need for tractors for ground operationsn Less use of the brakes during the taxi phasen Noise reduction at the gate arean Improved safety for ground personnel n Reduced engine maintenance by avoiding

ingestion of damaging debrisn Facilitated manoeuvring of the aircraft

during maintenance operations



A 50/50 Safran/Honeywell JV

32

Combining the strength of two market leaders

Honeywell and Safran have signed a MoU on Electric Green Taxiing system developmentn Provides an accelerated time to market for Electric Green Taxiing systemn Partnership includes joint system development, production, marketing and supportn JV to provide a superior product and global customer support

Partnership provides systems expertisen Honeywell Avionics and APU system breadthn Safran landing gear systems breadthn Complementary capabilities in electric power products

and systems integration

Early availability of Electric Green Taxiingn Vast breadth of aftermarket support from two major suppliersn One interface to operatorsn Integrating two capable suppliers brings the best Electric Green Taxiing system to market



The best time to market

33

Ready for EIS in 2016

Potential market for narrow body (2016-30)n Between 8,500 and 9,000 aircraft (forward fit and retrofit)

n Corresponding to approximately $5bn market opportunity

Estimated schedule

EIS



A significant milestone in aviation history

è A more electric airplane breakthrough innovationè A step forward to carbon footprint emission reductionè A significant Direct Operating Cost reduction for the airlines

34

A new transatlantic win win partnership



Conclusion/04/



A strategy delivering success

èLEAP selected by major airlines for A320neo and C919

èGrowing installed base, increasing aftermarket revenue opportunity

èMajor new programmes, improving market share

èStronger than ever innovation

èStrong balance sheet

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