Slide 1: 3Q/9M 2016 Results Presentation
3Q/9M 2016 Results Presentation Gian Piero Cutillo Chief Financial Officer Rome 4 November 2016
Slide 2: Key messages
Key messages Strong delivery of Industrial Plan in a challenging market environment Continued benefits from a stronger, better balanced portfolio Aeronautics and Electronics, Defence & Security continue to outperform vs expectation Offsetting weaker orders and revenues in Helicopters YTD; stronger p
Slide 3: New Orders
New Orders Very good performance even excluding EFA-Kuwait contract - 46.6% +11.6% +677.6% +99.0% % Ch. vs. 9M2015 € Mln Net of ca. 9,790 (63) 15,504 €200mln of negative exchange rate 7,791 4,239 1,538 9M2015 Helicopters Electronics, Defence Aeronautics Eliminations & Other 9M 9M2016 and Security Sy
Slide 4: Revenues
Revenues Lower YoY due to change in perimeter and shortfall in Helicopters - 20.1% - 5.9% - 3.7% - 10.7% % Ch. vs. 9M2015 € Mln 9,001 Net of ca. €200mln of 2,060 (158) 8,034 negative exchange rate 3,567 2,565 9M2015 Helicopters Electronics, Defence Aeronautics Eliminations & Other 9M 9M2016 and Secu
Slide 5: Profitability improvement
Profitability improvement EBITDA improving trend continues, margin 180bp higher YoY - 0.3 p.p. +1.3 p.p. +3.1 p.p. + 1.8 p.p. Ch. vs. 9M2015 € Mln 1,174 402 1,193 43 (8) (Margin 14.8%) (Margin 13.0%) (Margin 19.5%) 405 (Margin 11.4%) 351 (Margin 13.7%) 9M2015 Helicopters Electronics, Aeronautics Spa
Slide 6: Profitability improvement
Profitability improvement EBITA in line despite lower revenues, ROS 100bp higher - 0.8 p.p. +0.8 p.p. + 2.0 p.p. + 1.0 p.p. Ch. vs. 9M2015 € Mln Net of ca. 745 198 43 (49) 746 €15mln of (RoS 8.3%) (RoS 9.6%) (RoS 9.3%) negative exchange rate 269 (RoS 7.5%) 285 (RoS 11.1%) 9M2015 Helicopters Electron
Slide 7: Net Result Improvement
Net Result Improvement More than doubled on lower below the line and net financial expenses 9M2015 9M2016 +0.1% +5.3% +128.7% € Mln € Mln 745 745 (73) 746 746 (43) (72) (73) 631 631 (180) 599 599 (347) (108) 343 343 (102) 150 150 EBITA Restr./Non-rec. PPA EBIT Net financial Income Taxes Net Result E
Slide 8: FOCF and Net Debt
FOCF and Net Debt Disciplined financial strategy aimed at cash flow improvement and Net Debt reduction FOCF improvement Further boosted in Q3 by timing of initial payments under Eurofighter Kuwait contract FY2016E positive net effect of the first downpayment from Kuwait confirmed (ca.€200mln) Net de
Slide 9: Leonardo increases its stake in Avio
A step forward in the execution of the Industrial Plan Leonardo increases its stake in Avio Avio is leader in Space transportation technology, with system integration capabilities in propulsion for space launchers and complete launchers (Vega) In line with the Industrial Plan we will strengthen our
Slide 10: FY2016 Guidance
FY2016 Guidance All metrics potentially impacted by changes in exchange rate, mainly GBP/€ New Orders: challenging, due to the FY2015A FY2016E* prolonged crisis of civil helicopters markets Revenues: expected to be modestly below the lowest end, driven by lower Helicopters New orders € bn 12.4 ca. 2
Slide 11: Conclusion
Conclusion Strong delivery of industrial plan in a challenging market environment On track to deliver what we promised 3 years ago Stronger portfolio with a better balance between sectors 11
Slide 12: SECTOR RESULTS
SECTOR RESULTS 12
Slide 13: HELICOPTERS
HELICOPTERS 3Q 9M FY % % 2016 2015 2016 2015 2015 € Mln Change Change Orders 580 624 (7.1%) 1,538 2,881 (46.6%) 3,910 Revenues 857 1,098 (21.9%) 2,565 3,212 (20.1%) 4,479 EBITA 83 121 (31.4%) 285 381 (25.2%) 558 ROS % 9.7% 11.0% (1.3) p.p. 11.1% 11.9% (0.8) p.p. 12.5% Persisting challenging market c
Slide 14: ELECTRONICS, DEFENCE & SECURITY SYSTEMS
ELECTRONICS, DEFENCE & SECURITY SYSTEMS (Now includes Defence Systems as a Division , DRS and MBDA) Order increase mainly due to UK MoD - FSOM 3Q 9M FY Sharp improvement in profitability due to % % benefits from Industrial Plan actions 2016 2015 2016 2015 2015 € Mln Change Change DRS top line down d
Slide 15: AERONAUTICS
AERONAUTICS 3Q 9M FY % % 2016 2015 2016 2015 2015 € Mln Change Change Orders 305 568 (46.3%) 9,790 1,259 677.6% 1,741 Revenues 681 726 (6.2%) 2,060 2,140 (3.7%) 3,118 EBITA 83 77 7.8% 198 163 21.5% 312 ROS % 12.2% 10.6% 1.6 p.p. 9.6% 7.6% 2.0 p.p. 10.0% Very good order intake even excluding the Euro
Slide 16: SPACE
SPACE 3Q 9M FY % % 2016 2015 2016 2015 2015 € Mln Change Change EBITA 14 5 180.0% 43 27 59.3% 37 Higher volumes and better profitability in Manufacturing; Services in line with 2015 EBITA and profitability expected to recover in 2016 16
Slide 17: APPENDIX
APPENDIX 17
Slide 18: GROUP PERFORMANCE
GROUP PERFORMANCE 3Q 9M FY % % 2016 2015 2016 2015 2015 Change Change € Mln New Orders 2,637 2,252 17.1% 15,504 7,791 99.0% 12,371 Backlog 34,589 28,071 23.2% 28,793 Revenues 2,621 3,028 (13.4%) 8,034 9,001 (10.7%) 12,995 EBITDA 407 436 (6.7%) 1,193 1,174 1.6% 1,866 EBITDA Margin 15.5% 14.4% 1.1 p.p
Slide 19: Eurofighter Kuwait contract
Eurofighter Kuwait contract Downpayment received in 3Q2016 Contract signed on April 5th 2016 for 28 Eurofighter in the most advanced configuration, including new E-Scan radar Leonardo as prime contractor will lead all activities on behalf of the Consortium. Our share is ca. 60% of total value (€ 7,9
Slide 20: FINANCIAL POSITION (as of end of September 2016)
FINANCIAL POSITION (as of end of September 2016) No refinancing needs before end 2017 Key Strong liquidity position Messages Bonds have neither financial covenants nor rating pricing grids Average life approx. 7 years (€mil) Dollar Bond Maturity 369 Sterling Bond Schedule 521 500 739 556 Euro Bond 3
Slide 21: LIQUIDITY POSITION (as of end of September 2016)
LIQUIDITY POSITION (as of end of September 2016) In order to cope with possible swings in financing needs, Leonardocan leverage: – 30 September cash balance of approx. €1.0Billion Availability of – Credit lines worth €2.7 Billion (confirmed and unconfirmed) The Revolving Credit Facility was renegoti
Slide 22: 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 23: Investor Relations & SRI Contacts
Investor Relations & Sustainable Responsible Investors (SRI) Contacts Raffaella Luglini Head of Investor Relations & SRI +39 06 32473.066 raffaella.luglini@leonardocompany.com Valeria Ricciotti Alessio Crosa Manuel Liotta Equity Analysts & Investors Fixed Income Analysts & Investors and Group Sustai