Safran Sa · EURONEXT:SAF
Safran Sa — JP Morgan Fireside Chat December 2020
20 slides from Safran Sa's conference presentation, Dec 15, 2020
Slide 1: Safran JP Morgan Fireside Chat
SAFRAN DECEMBER 2020 JP MORGAN FIRESIDE CHAT This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran
Slide 2: Disclaimer
Disclaimer FORWARD-LOOKING STATEMENTS This document contains forward-looking statements relating to Safran, which do not refer to historical facts but refer to expectations based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actu
Slide 3: Summary
SUMMARY 2020: ADAPTING SPEEDILY 2021: CONSOLIDATING SOUNDLY FROM 2022: RECOVERING GRADUALLY 3 Safran – JP Morgan Fireside Chat – December 15, 2020 This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written
Slide 4: 2020: Adapting Speedily
2020: ADAPTING SPEEDILY 4 Safran – JP Morgan Fireside Chat – December 15, 2020 This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran
Slide 5: Update on air traffic
Update on air traffic IATA forecast Safran assumptions In October 2020, air traffic remains very weak compared to the previous year > RPK: (70.6)% - domestic: (40.8)% > ASK: (59.9)% - domestic: (29.7)% Slight air traffic growth around the world except in Europe due to an increasing number of lock
Slide 6: Key achievements (1/2)
Key achievements (1/2) Savings > Scaling down purchasing programs in 9m 2020 in line with the drop in activity > Reduction of permanent workers by more than 16,000 people, more than 20,000 people including temporary workers, (21)% on a worldwide basis as of November 27, 2020 > In France, a Group “Ac
Slide 7: Key achievements (2/2)
Key achievements (2/2) Cash outflows Monitoring working capital Level of Capex outflows down by Euro 200 Reducing inventories million between 2019 and 2020 reflecting the confirmed reduction in commitments of 60% Managing airlines receivables: overdues and compared to 2019 (reduced by (74)% in 9m
Slide 8: FY 2020 snapshot
FY 2020 snapshot Safran businesses strongly impacted by the Covid-19 crisis ● 9m 2020 revenue down by (33.4)% org. vs. 9m 2019 Despite the unprecedented crisis the aerospace industry is facing, Safran Crisis started to materialize in March has been able : To disclose a FY 2020 guidance and Safran
Slide 9: 2021: Consolidating Soundly
2021: CONSOLIDATING SOUNDLY 9 Safran – JP Morgan Fireside Chat – December 15, 2020 This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran
Slide 10: 2021 Consolidating soundly: by key KPIs (1/2)
2021 Consolidating soundly: by key KPIs (1/2) What is at stake in 2021? ● Q1 2020 creates a tough comparison basis for Q1 2021 and FY notably for civil aftermarket (gradual recovery depending upon CFM56 flight cycle improvement) Revenue ● No overall improvement coming from OE ● Uncertainty on Aircra
Slide 11: 2021 Consolidating soundly: by businesses (2/2)
2021 Consolidating soundly: by businesses (2/2) What is at stake in 2021? ● Narrowbody engines: 800+ LEAP deliveries and continuing decrease for CFM56 ● High-thrust engines: lower volumes anticipated compared to 2020 Propulsion ● Military engines: as planned M88 volumes back to 2019 level ● Civil af
Slide 12: Focus on FX
Focus on FX 2020 2021 - 2022 ● Net annual exposure below $8.0bn ● Net annual exposure between $8.0bn and $9.0bn ● Fully hedged ● Fully hedged in 2021 and almost fully hedged in 2022 including options with Knock-Out barriers ● €/$ hedge rate is confirmed at $1.16 ranging from $1.22 to $1.27 ● Average
Slide 13: Liquidity: €4.1bn cash and cash equivalents at end of November 2020
Liquidity : €4.1bn cash and cash equivalents at the end of November 2020 (unaudited) ● Bridge facility set up on April 22, 2020 with a maturity of up to two years remained undrawn Bridge Facility ● Initial €3.0bn amount reduced to €1.4bn after more than 50% having been already refinanced with medium
Slide 14: From 2022: Recovering Gradually
FROM 2022: RECOVERING GRADUALLY 14 Safran – JP Morgan Fireside Chat – December 15, 2020 This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran
Slide 15: Long trends remain…
Long trends remain… ‒ Sizeable order backlog: Leap Backlog ~10,000 engines at the end of September 2020 (based on purchase orders and pending cancellations) NEW ‒ Strong market share for narrowbody (61% on A320neo family) EQUIPMENT (OE) ‒ Present on all next or new generation aircraft programs (A320
Slide 16: … and Safran well positioned for market recovery
… and Safran well positioned for market recovery Costs Innovation Structural savings (footprint optimization, Safran technological priorities preserved overhead cuts) (notably thanks to government support) Workforce (excluding temporary workers) expected to be down by 10-15% in 2024 Pre-Covid roadma
Slide 17: Safran ESG strategy
Safran ESG strategy SAFRAN ESG RATINGS: SAFRAN CSR COMMITMENTS CDP: A- (since Dec 2020) Part of Safran business model and built on three strategic assets (sustainable innovation, operational excellence, responsible conduct) MSCI: A (since June 2019) Consistent with the UN sustainable Susta
Slide 18: Commitment to climate change: reduction in CO2 emissions from products
Focus on Safran’s commitment to climate change: reduction in CO2 emissions from its products 1 In the last 60 years, aircraft fuel consumption divided by 5, 70% of the drop achieved with the engine To be ready for low-carbon aviation by 2030-2035, Safran makes climate change a central part of its 2
Slide 19: Confirming Safran's strengths, despite the crisis
Confirming Safran’s strengths, despite the crisis 3rd Global aerospace group (excluding airframers), 2nd Global aerospace equipment supplier Global leader in critical and highly technological aircraft systems Propulsion (n°1 for short/medium range engines), landing gear and carbon brakes (n°1)
Slide 20: Safran – JP Morgan Fireside Chat – December 15, 2020
20 Safran – JP Morgan Fireside Chat – December 15, 2020 This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran