Leonardo Spa · MIL:LDO
Leonardo Spa — Merger or Acquisition (June 2022)
20 slides from Leonardo Spa's merger presentation, Jun 21, 2022
Slide 1: A Strategic Transaction for Leonardo and Leonardo DRS
A Strategic Transaction for Leonardo and Leonardo DRS Rome 21 June 2022
Slide 2: Agenda
Agenda • Situation update Alessandro Profumo, Chief Executive Officer of Leonardo • Transaction highlights William J. Lynn III, Chief Executive Officer of Leonardo DRS • Value creation proposition Alessandro Profumo, Chief Executive Officer of Leonardo • Q&A 2 © 2022 Leonardo - Società per azioni 1Q
Slide 3: Building capabilities for today's and tomorrow's defense market
Building capabilities for today’s and tomorrow’s defense market • Important strategic move to strengthen our position in a very attractive market • Leonardo DRS + RADA very well placed to be a leader in rapidly growing Force Protection market • Creating opportunities in the US and internationally, l
Slide 4: Leonardo DRS continued growth, refocused on its core business
Leonardo DRS continued growth, refocused on its core business A leading provider of advanced defense electronics products and technologies strongly positioned across rapidly growing segments in the US defence markets Growth path Leonardo DRS 1 • Strong product portfolio and backlog (funded and unfun
Slide 5: Leonardo DRS merger with RADA: excellent strategic fit
Leonardo DRS merger with RADA: excellent strategic fit, very well placed within Leonardo Group RADA in the wider LDO Group Complementary tactical radar sensors • Increased addressable market and strong fit/diversity of programs Value portfolio proposition Enhancement of market positioning in • Compl
Slide 6: Agenda
Agenda • Situation update Alessandro Profumo, Chief Executive Officer of Leonardo • Transaction highlights William J. Lynn III, Chief Executive Officer of Leonardo DRS • Value creation proposition Alessandro Profumo, Chief Executive Officer of Leonardo • Q&A 6 © 2022 Leonardo - Società per azioni 1Q
Slide 7: Combination with RADA is the logical next step for Leonardo DRS
Combination with RADA is the logical next step for Leonardo DRS • Transaction expected to elevate Leonardo DRS into a market leader in advanced sensing and force protection aligned with some of the fastest growing segments of the US DoD budget and current global military requirements and needs, ensu
Slide 8: Combined global footprint creates opportunities in reshaped robust defence market
Combined global footprint creates opportunities in reshaped robust defence market Reshaped global defence market Select opportunities Growth on existing US platforms and programmes Battle management systems for Eastern Europe IM-SHORAD and other counter small UAS solutions for Eastern Europe
Slide 9: Future market opportunities enabled by DRS
Future market opportunities enabled by DRS • RADA’s base business of software defined, solid state radars provides strong long-term growth and supports the transaction valuation • The merger of RADA & DRS provides significant upside beyond the base case by combining the advanced sensing capabilities
Slide 10: Agenda
Agenda • Situation update Alessandro Profumo, Chief Executive Officer of Leonardo • Transaction highlights William J. Lynn III, Chief Executive Officer of Leonardo DRS • Value creation proposition Alessandro Profumo, Chief Executive Officer of Leonardo • Q&A 10 © 2022 Leonardo - Società per azioni 1
Slide 11: Transaction allows capture new opportunities and a strong value creation potential
Transaction allows capture new opportunities and a strong value creation potential • An all-stock merger which will result in a publicly listed company post close (“DRS” NASDAQ & TASE) • Leonardo to own 80.5% of the strategically improved combined company post-close Unlock value for Value creation p
Slide 12: Value creation opportunity over time for all shareholders
Value creation opportunity over time for all shareholders Strategically relevant for Leonardo and at a better valuation vs. 2021 IPO attempt • Strategically positions DRS in a highly attractive segment of today and tomorrow’s defence market • Allowing the opportunity to list DRS in the current conte
Slide 13: Key takeaway messages
Key takeaway messages • We are fully convinced about the strong strategic and financial value of this transaction for Leonardo - We have delivered the plan as promised on a DRS stand-alone basis - We have refocused DRS on its core business - We have reinforced it through this transaction - Finding a
Slide 14: Q&A
Q&A 14 © 2022 Leonardo - Società per azioni
Slide 15: Appendix
APPENDIX 15 © 2022 Leonardo - Società per azioni
Slide 16: Leonardo DRS Reconciliations
LEONARDO DRS RECONCILIATIONS Revenue (Adjusted for Previously Announced Divestitures) ($ in millions) 2018 2019 2020 2021 Total revenues $2,333 $2,714 $2,778 $2,879 Less divestiture impact $256 $236 $254 $232 Revenue less divestitures $2,077 $2,478 $2,524 $2,647 Adjusted EBITDA ($ in millions) 2018
Slide 17: RADA Reconciliations
RADA RECONCILIATIONS Adjusted EBITDA (US dollars in millions) 2018 2019 2020 2021 2021 Q1 2022 Q1 LTM Net income (loss) ($0.2) ($2.3) $5.6 $25.1 $3.8 ($0.7) $20.6 Tax expense 0.0 0.0 0.0 (4.9) 0.0 (0.2) (5.0) Financial expense (income), net 0.3 0.2 (0.2) 0.2 (0.2) (0.0) 0.4 Depreciation 0.8 1.2 2.3
Slide 18: Safe Harbor Statement
SAFE HARBOR STATEMENT NOTE: Some of the statements included in this document are not historical facts but rather statements of future expectations, also related to future economic and financial performance, to be considered forward-looking statements. These forward-looking statements are based on Co
Slide 19: Safe Harbor Statement
SAFE HARBOR STATEMENT ADDITIONAL INFORMATION ABOUT THE TRANSACTION AND WHERE TO FIND IT DRS will file with the U.S. Securities and Exchange Commission (SEC) a registration statement on Form S-4, which will include a prospectus of DRS, and certain other documents in connection with the transaction. S
Slide 20: Contacts
CONTACTS Valeria Ricciotti Head of Investor Relations and Credit Rating Agencies +39 06 32473.697 valeria.ricciotti@leonardo.com Leonardo Investor Relations and Credit Rating Agencies +39 06 32473.512 ir@leonardo.com leonardo.com 20 © 2022 Leonardo - Società per azioni