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Leonardo S.p.A. — Investor Presentation 2017
May 4, 2017
4038_10-q_2017-05-04_7a152a91-97e4-4d97-be24-65401cea9ba9.pdf
Investor Presentation
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1Q 2017 Results Presentation
Gian Piero Cutillo
Chief Financial Officer
Rome, 4 May 2017
Q1 Key messages
- On track and fully focused on delivering the Industrial Plan
- Good commercial performance
- Expected softer volumes after very strong Q4, especially in Helicopters
- Continued improvements in EBITA and profitability, driven byE,D&SS
- FOCF benefitted of Kuwait contract advance payment
- FY Guidance confirmed
New Orders
In line or above expectations
3
Revenues
Soft start expected
4
Profitability improvement
EBITA continued to improve despite lower Revenues. RoS 110bp higher
Net Result Before Extraordinary Transactions Improvement
+39% YoY on higher EBITA and EBIT
1Q2016
FY2017 Guidance unchanged
- EBITA: further improvement confirmed also in profitability
- Below the line: further reduction of the non-recurring items
- FOCF: 2016-2017 cumulative net effect of the EFA Kuwait advance payment confirmed at around € 600 mln
- Net Debt: down ca. €300mln, including the acquisition of Daylight Solutions and the proposed payment of dividend for €0.14 p.s.
| F Y A 2 0 1 6 |
F Y E * 2 0 1 7 |
||
|---|---|---|---|
| N d e w o r e r s |
€ b n |
2 0 0 |
1 2 0 1 2 5 – |
| R e v e n u e s |
€ b n |
1 2 0 |
1 2 0 c a |
| E B I T A |
€ l m n |
1 2 2 5 , |
1 2 0 1 3 0 0 5 – , , |
| C F O F |
€ l m n |
0 6 7 |
0 0 6 0 0 5 – |
| G N t r o u p e D b t e |
€ b n |
2 8 |
2 5 c a |
(*) Assuming €/\$ exchange rate at 1.15 and €/£ at 0.85
SECTOR RESULTS
1Q2017 Sector results
Helicopters
| Q 1 |
F Y |
||||
|---|---|---|---|---|---|
| € M ln |
2 0 1 7 |
2 0 1 6 |
% C h a n g e |
2 0 1 6 |
|
| O d r e rs |
4 9 5 |
3 8 4 |
1 9. % 5 |
3, 3 7 7 |
|
| Re ve nu e s |
7 1 1 |
8 1 0 |
( ) 1 2. 2 % |
3, 6 3 9 |
|
| E B I T A |
7 3 |
8 3 |
( ) 1 2. 0 % |
4 3 0 |
|
| O S R % |
1 0. 3 % |
1 0. 2 % |
0. 1 p. p. |
1 1. 8 % |
- Higher orders YoY, still in markets that remain challengingand uncertain
- Softer revenues after strong 4Q, due to slower recovery of production in civil and the completion of someprogrammes on the AW159/Lynx lines
- Double-digit profitability solidly maintained despite lower volumes
- For FY2017, in a still challenging environment, we expect revenues almost in line with 2016, underpinnedby a strong backlog and the entry in full operation of the new AW169. Profitability at double digit, in linewith 2016
1Q2017 Sector results
Electronics, Defence & Security Systems*
| 1 Q |
F Y |
||||
|---|---|---|---|---|---|
| € M ln |
2 0 1 7 |
2 0 1 6 |
% C h a n g e |
2 0 1 6 |
|
| O d r e rs |
1, 0 3 9 |
1, 2 1 7 |
( ) 1 4. 6 % |
6, 7 2 6 |
|
| Re ve nu e s |
1, 1 4 6 |
1, 1 3 4 |
1. 1 % |
4 6 8 5, |
|
| E B I T A |
8 4 |
5 6 |
5 0. 0 % |
5 5 8 |
|
| R O S % |
7. 3 % |
4. 9 % |
2. 4 p. p. |
1 0. 2 % |
Of whichDRS:
| F Y |
||||
|---|---|---|---|---|
| \$ M ln |
2 0 1 7 |
2 0 1 6 |
% C h a n g e |
2 0 1 6 |
| O d r e rs |
4 0 1 |
4 2 2 |
( ) 5. 0 % |
1, 9 2 3 |
| Re ve nu e s |
3 9 5 |
3 6 4 |
8. 5 % |
1, 7 5 3 |
| E B I T A |
2 5 |
1 7 |
4 7. 1 % |
1 2 8 |
| R O S % |
6. 3 % |
4. 7 % |
1. 6 p. p. |
7. 3 % |
- Good commercial performance, withexpected decline in Land&Naval Defence Electronics, partially offset by higher ordersinAirborne & Space Systems.
- With revenues in line YoY, sharpimprovement in profitability due to benefitsfrom Industrial Plan actions and profitabilityrecovery in some areas
- 2017 Revenues and Profitability expected tobe substantially in line with 2016, despite amore competitive environment and thewinding down of some profitableprogrammes, supported by benefits comingfrom industrial processes improvements
- For DRS we continue to expect positivetrend in business growth and a furtherincrease in profitability
1Q2017 Sector results
Aeronautics
| 1 Q |
F Y |
||||
|---|---|---|---|---|---|
| € M ln |
2 0 1 7 |
2 0 1 6 |
% C h a n g e |
2 0 1 6 |
|
| O d r e rs |
1, 2 3 7 |
9 9 3 |
2 4. 6 % |
1 0, 1 5 8 |
|
| Re ve nu e s |
6 6 5 |
6 3 8 |
2. 8 % |
3, 1 3 0 |
|
| E B I T A |
4 6 |
4 1 |
1 2. 2 % |
3 4 7 |
|
| R O S % |
7. 0 % |
6. 4 % |
0. 6 p. p. |
1 1. 1 % |
- Significant New Orders in Aircraft (EFA capability maintenance and support engineering services, first batch of new M-345 for AMI) andAerostructures (B787, ATR)
- Higher EBITA driven byAircraft (EFA)
- 2017 revenues expected in line with 2016. "Double digit" profitability confirmed, benefitting fromefficiency-improvement and cost reduction actions, aimed at offsetting the winding down of some military programmes and lower contribution from ATR
1Q2017 Sector results
Space
| Q 1 |
F Y |
||||
|---|---|---|---|---|---|
| € M ln |
2 0 1 7 |
2 0 1 6 |
% C h a n g e |
2 0 1 6 |
|
| E B I T A |
8 | 4 | 1 0 0. 0 % |
7 7 |
- Better results on higher volumes in Manufacturing and improvements in industrial profitability in SatelliteServices
- 2017 Profitability expected in line with 2016, with growingManufacturing Revenues
1Q2017 results
Group Performance
| 1 Q |
F Y |
|||
|---|---|---|---|---|
| € M ln |
2 0 1 7 |
2 0 1 6 |
% C h a n g e |
2 0 1 6 |
| Ne O d w r e rs |
2, 6 4 7 |
2, 5 6 4 |
3. 2 % |
1 9, 9 5 1 |
| Ba k lo c g |
3 4, 8 3 2 |
2 8 6 3 7, |
2 0 % 5. |
3 4, 9 8 7 |
| Re ve nu e s |
2, 4 7 6 |
2, 5 3 6 |
( ) 2. 4 % |
1 2, 0 0 2 |
| E B I T D A |
3 3 0 |
3 2 6 |
1. 2 % |
1, 9 0 7 |
| E B I T D A M in a rg |
1 3. 3 % |
1 2. 9 % |
0. 4 p. p. |
1 5. 9 % |
| E B I T A |
1 8 7 |
1 6 4 |
1 4. 0 % |
1, 2 5 2 |
| O S R % |
6 % 7. |
6. % 5 |
1. 1 p. p. |
1 0. 4 % |
| E B I T |
1 5 5 |
1 3 4 |
1 5. 7 % |
9 8 2 |
| E B I T M in a rg |
6. 3 % |
3 % 5. |
1. 0 p. p. |
8. 2 % |
| Ne l b fo d ina io t t t t t re su e re ex ra o r ry ra ns a c ns |
7 8 |
5 6 |
3 9. 3 % |
5 4 5 |
| G Ne l t t ro u p re su |
7 8 |
6 4 |
2 1. 9 % |
5 0 7 |
| S ( ) E P € t c e n s |
0. 1 3 6 |
0. 1 1 1 |
2 2. % 5 |
0. 8 9 7 |
| F O C F |
( ) 4 2 7 |
( ) 8 7 6 |
5 1. 3 % |
7 0 6 |
| G Ne De b t t ro u p |
3, 2 4 5 |
4, 2 1 2 |
( ) 2 2. % 7 |
2, 8 4 5 |
| He d t a c ou n |
4 5, 4 0 7 |
4 6, 7 5 6 |
( ) 2. 9 % |
4 5, 6 3 1 |
Balance Sheet solidity – Financial position and Rating (as of end of March 2017)
LIQUIDITY POSITION (as of end of March 2017)
In order to cope with possible swings in financing needs, Leonardo can leverage:
- –31 March cash balance of approx. €1.8 Billion
- Credit lines worth €2.7 Billion (confirmed and unconfirmed)
- The Revolving Credit Facility was renegotiated on 6 July 2015 lowering the margin from 180bps to 100bps. The renegotiated facility has an amount of €2.0bn and will expire in July 2020
- – Bank Bonding lines of approximately €4.0 Billion to support Leonardo's commercial activity
(1) Based on rating as of 31/03/2017
(2) Average. Expected to be renewed at maturity
Availability ofadequatecommittedliquidity lines
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 Company's views and assumptions as of the date of the statements and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Given these uncertainties, you should not rely on forward-looking statements.
The following factors could affect our forward-looking statements: the ability to obtain or the timing of obtaining future government awards; the availability of government funding and customer requirements both domesticallyand internationally; changes in government or customer priorities due to programme reviews or revisions to strategic objectives (including changes in priorities to respond to terrorist threats or to improve homeland security); difficulties in developing and producing operationally advanced technology systems; the competitive environment; economic business and political conditions domestically and internationally; programme performance and the timing of contract payments; the timing and customer acceptance of product deliveries and launches; our ability toachieve or realise savings for our customers or ourselves through our global cost-cutting programme and other financial management programmes; and the outcome of contingencies (including completion of any acquisitions and divestitures, litigation and environmental remediation efforts).
These are only some of the numerous factors that may affect the forward-looking statements contained in this document.
The Company undertakes no obligation to revise or update forward-looking statements as a result of new information since these statements may no longer be accurate or timely.
Investor Relations & Sustainable Responsible Investors (SRI)
Contacts
Raffaella LugliniHead of Investor Relations & SRI+39 06 [email protected]
Valeria Ricciotti
Equity Analysts & Investors+39 06 [email protected]
Alessio Crosa
Fixed Income Analysts & Investors and relationship with Credit Rating Agencies+39 06 [email protected]
Manuel Liotta
www.leonardocompany.com/investors
Group Sustainability & ESG+39 06 [email protected]
2016 Annual Results
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Sustainability
Member since 2010 Partecipation since 2008
since 2016
Sustainabilityand InnovationReport 2015
19We do business in a sustainable manner, with a continued commitment to economic and social development and the protection of public health and the environment.