Focus on Security Business

Transcription

1 EADS Security & Defence Focus on Security Business Hervé Guillou Head of Defence and Communications Systems Global Investor Forum 2009, Broughton, 1 st & 2 nd April

2 Safe Harbour Statement Disclaimer This presentation includes forward-looking statements. Words such as anticipates, believes, estimates, expects, intends, plans, projects, may and similar expressions are used to identify these forward-looking statements. Examples of forward-looking statements include statements made about strategy, ramp-up and delivery schedules, introduction of new products and services and market expectations, as well as statements regarding future performance and outlook. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include but are not limited to: Changes in general economic, political or market conditions, including the cyclical nature of some of EADS businesses; Significant disruptions in air travel (including as a result of terrorist attacks); Currency exchange rate fluctuations, in particular between the Euro and the U.S. dollar; The successful execution of internal performance plans, including cost reduction and productivity efforts; Product performance risks, as well as programme development and management risks; Customer, supplier and subcontractor performance or contract negotiations, including financing issues; Competition and consolidation in the aerospace and defence industry; Significant collective bargaining labour disputes; The outcome of political and legal processes, including the availability of government financing for certain programmes and the size of defence and space procurement budgets; Research and development costs in connection with new products; Legal, financial and governmental risks related to international transactions; Legal and investigatory proceedings and other economic, political and technological risks and uncertainties. As a result, EADS actual results may differ materially from the plans, goals and expectations set forth in such forwardlooking statements. For a discussion of factors that could cause future results to differ from such forward-looking statements, see EADS Registration Document dated 24th April Any forward-looking statement contained in this presentation speaks as of the date of this presentation. EADS undertakes no obligation to publicly revise or update any forward-looking statements in light of new information, future events or otherwise. 2 2

3 Content Security Market for EADS Business Growth, Risks and Opportunities EADS Business Model Lead System Integration (LSI) Products and Solutions Conclusion 3 3

4 Global Security Market Evolution Evaluation of DCS' global security accessible market (M ) Emergency response Protection of Population Critical infrastructure Maritime Security Border Security CAGR = 8.9% CAGR = 2% Main Security Segments - Protection of population - Border security - Critical infrastructures & site protection - Crisis & Emergency response - Maritime security Hypothesis: The security market will be mature in Sources: Estimation based on Civitas 2006, EADS DS estimates 4 4

5 Competitors Landscape by Mission Type Protection of of the population Critical Infrastructures & Sites Protection Border Security Crisis & emergency response Maritime security Products approach LSI approach 5 5

7 Growth Drivers Integrated Systems and LSI Telecoms IT Lead System Integration (LSI) share is growing in Defence and in Security A lot of customers (Security & new countries for Defence) not having sufficient internal system and procurement capabilities Other customers seeking capabilities instead of systems Emerging market segments Cyber security, maritime security, border security, information superiority Telecoms & IT convergence E.g. broadband solutions, enabling enhanced situation awareness, as major driver Defence Security Defence & security convergence Security requirements of defence and governmental customers converging (resilience, sharing of information ) Regional growth Industrial footprint in Middle East & North Africa Industrial footprint in Middle East & North Africa 7 7

8 EADS Security Strengths Finding the best solution for our customers e.g. via the System Design Centre Global security management EADS integrated approach Generation of local value e.g. Middle East and North Africa 8 8

9 EADS Security Business Growth 2000: Professional Mobile Radio only 2008: Security activities based on the development of internal competences (e.g.: PMR, homeland security) and the acquisitions of several companies (e.g.: Sofrelog, Plant CML) Revenues in Bn Backlog in Bn Since 2004, 2 restructuring and operational performance programmes achieved Included divestment of non core activities => More integrated organisation Profitability now comparable to European defence market standard Further efforts underway with a new programme called Step

11 Main Programmes and Campaigns 11 11

12 EADS Global Security Market Clusters Security Objectives EADS DS Offer Protection of the population - Public safety (police, fire, rescue) - Major event security - Coordination of governement forces Border Security - Surveillance of land, coastal and maritime borders and checkpoints - Airspace surveillance Critical Infrastructures & Sites Protection -Protection of critical assets (oil & gas, refineries, energies etc..) - Harbours Crisis & emergency response - Prevention & Plans definition - Emergency calls management (112) - Major crisis management: eg: Natural disasters, Industrial accidents Blackmail, etc.. A mission-critical communications system is a crucial element in all these global security solutions Maritime security - Port security: control and protect vessels, vessel traffic, port infrastructures, flows of persons, cargo and industrial activities. - Coastal security detection of pollution, trafficking or immigration - Maritime security Economic Exclusive Zone (EEZ) and the high seas surveillance Market addressed through two business model approaches: LSI and based on our missions critical communications system portfolio 12 12

13 EADS LSI Selected References UK Fire Service modernisation French Spationav Coastal Qatari Border Surveillance EEZ EEZ -> Coverage of vital areas TW Territorial Waters -> Full coverage Coastline -> Full coverage Coastline Land Border Land Border -> Full coverage EADS Interest: Strengthen EADS position Develop a deep understanding of required LSI key capabilities Improve customer intimacy 13 13

14 EADS Defence and Security is the World Leader in Maritime Security e.g Market share EADS 40 % Kongsberg 27% HITT 10% 14 14

16 The Value Chain of Critical Call Taking Defense communication CITIZENS Emergency Call 911 / 112 Call reception localization and mapping Emergency Notification Reverse 911/112 Call dispatch Govt forces coordination Police communication Fire brigades communication Medical urgency communication Office kit Business critical communication 16 16

17 EADS Digital PMR Network Deliveries More than 190 networks in over 65 countries based on Tetrapol, P25 (developed) and Tetra (acquisition of Nokia Business) Revenues in Mio estimates - EADS ~550 Selex ~90 Motorola ~

18 Last Security Acquisition: Plant CML Company acquired in April 2008 by EADS North America Provides Public and private safety call centers & communications (e.g. radio dispatch, emergency call centers) Approx 170 m$ revenues / year, 600 employees Main site: Temecula, California, USA Public Safety Answering Point ( PSAP ): A facility equipped and staffed to receive calls 18 18

20 Conclusions EADS DS has won significant major contracts in strong competition Security market growing (average CAGR > 20%)and offering future significant growth potential for EADS DS EADS DS well positioned due to excellent understanding of customers needs and access to best in class capabilities and technologies (internally and externally to EADS) EADS DS needs to structure the market, both on demand and offer side 20 20