EADS in Defence Capturing Growth and Delivering Profits

Transcription

1 EADS in Defence Capturing Growth and Delivering Profits Tom Enders CEO Defence & Security Systems Place for Date of presentation, place Global Investor Forum Paris June 20 & 21, Contents 1. EADS in Defence: Challenges 2. Main Achievements 3. Major Projects and Activities/ Market Potential 4. Perspectives 2 1

2 1. EADS in Defence: Challenges Customer s focus on jointness and speed requires industrial transformation as well! Accelerate cross-divisional synergies, promote innovative technologies, use system competence for new integrated solutions Create prerequisites and tools for accelerated processes spiral development, Large Systems Integration (LSI) Support military transformation processes within NATO, EU and home markets, initiate transformation projects Support harmonisation of the European defence sector Transatlantic cooperation where possible 3 Contents 1. EADS in Defence: Challenges 2. Main Achievements 3. Major Projects and Activities/ Market Potentials 4. Perspectives 4 2

3 2.1 Building a World-Class Defence Business Broadening capabilities: Services, Homeland Security, C4ISR etc Broadening international market access: U.S. and Asia-Pacific Modern systems/strong demand: Eurofighter, Missiles (Aster, Meteor, Storm Shadow, Taurus etc.), UAVs (MALE, HALE), MEADS, NH90, Tiger, A400M Organic and external growth How? Extend product/offer range Expand outside Europe EADS Defence at a Glance (1) Main Fields of Activities Military Aircraft (Combat, Transport, Mission, and Tanker Aircraft, UAV s) Missiles Helicopters Military Satellites/Launchers Air and Missile Defence C3I Systems Homeland Security Electronics Services NEW: Large Systems Integration (LSI) Eurofighter Storm Shadow FSTA Tiger NH90 Helicopters FSTA EuroHawk CH-53 HTH 6 3

4 2.2 EADS Defence at a Glance (2) Key Figures 2004 Revenues: 7.7 bn (74% in F, G, Sp, UK) Order intake: 11.4 bn (72% in F, G, Sp, UK) Order Backlog: 49.1 bn (80% in F, G, Sp, UK) *MBDA 50% consolidated EADS defence order book (bn ) EADS defence revenues (bn ) ~ 8.5 ~ '07 (Expected) DS Financial Facts and Figures DS Facts: Revenues m 5,385 5,165 6,000 5,000 2,909 3,345 3,306 4,000 3,000 2,000 1, * 2001* 2002* *Excluding Military Aircraft Business Unit DS Facts: Order Intake and Order Backlog m 20,000 DS Facts: EBIT EBIT m , ROS 1.2% 3.3% 4.2% * 2001* 2002* *Excluding Military Aircraft Business Unit ,000 13, ,000 9,722 9,094 8,457 8,000 3,857 3,081 5,413 6,288 4, * 2001* 2002* *Excluding Military Aircraft Business Unit 8 4

5 2.3 Main DS Organisational Achievements ( ) Integrated cross-border BUs: Created in 2001 Creation of DS (2003): Military Aircraft joined, DS organisation integrated, strengthened and streamlined - meeting customer needs (LSI, System Design Centre), increasing profitability Focusing on core businesses: Divesting non-core activities, fostering efficiency programmes Efficiency improvements: Synergies achieved through merger integration (more than 100 M recurring savings* from 2006) Systems Integration Capabilities improved: Creation of Systems House, SDC, Simulation tools (NetCOS), DS established as lead defence and security pole in EADS Shared service centres: Six specific administrative tasks centralised (recurring savings* from 2006: approx. 40M ) *not full EBIT impact Project and Risk Management in DS (since 2003) DS develops and implements Project and Risk Management to establish international best practices in major areas: Risk and Opportunity Management to optimize project results PRM triggered overall EADS Quality & Operational Excellence Programme (QOEP) 10 5

6 2.4 EADS Quality & Operational Excellence Programme (QOEP) Continuous improvement of On-Time and On-Quality Delivery performance Quality & Operational Excellence Programme (QOEP) launched Programme targets five key areas for action across all of EADS: 1. Stronger focus on Customer (Regular Review Process) 2. Supply Chain processes 3. Quality Gates in key industrial processes 4. Training, qualification and coaching of ( EADS Black Belts ) 5. Measuring On-Time & On-Quality Delivery performance and Customer Confidence in every Business Unit 11 Contents 1. EADS in Defence: Challenges 2. Main Achievements 3. Major Projects and Activities/ Market Potential 4. Perspectives 12 6

7 3.1 Extending Business in Defence 2 Electronic Platforms Sub Systems System Integration Large System Integration 1. Develop core business on platforms: A 400M, tankers, UAVs, missiles AGS 2. Become a Large System Integrator: LEAPP, AGS, BMD 3. Master key technologies: data fusion, electronic warfare, PMR, data link 4. Expand into services: Paradigm, FSTA, Bosnet 5. Develop Homeland Security offer: border surveillance, large event security 6. Expand global reach outside Europe: EADS Defence NA, GIS 1 Air LEAPP BMD Space Paradigm Electronics 3 Naval Ground LSI role Platform Prime Deepwater Naval AD FAUST, IDZ 4 Defence Services 5 Homeland Security 6 Regional and global reach EADS the Network Centric Enterprise: System Design Centre NATO SACT contract for CD&E contractual support in Norfolk (With SAIC) Germany France United Kingdom Spain Page

8 3.3 Transatlantic Cooperation: Building the Bridge MEADS Deepwater NATO AGS New Systems: US Tanker Program KC-330 Tanker EADS-NA intends to offer the KC- 330 for the US Air Force s KC-135 Replacement program RFP expected in late 2005 Contract Award in 2006 $99M in 2006 President s Budget $9B funding line for Total potential program value is $100B for 400+ A/C Tanker assembly site selection and team building underway; concept is Airbus engineering center (guaranteed) plus production facility (if EADS is awarded a contract) Four possible sites: Alabama, Florida, Mississippi and South Carolina 16 8

9 3.5 New Systems: Unmanned Aerial Vehicles Unmanned Aerial Vehicles: Market Potential Total Market Potential until 2014: 10 bn The market for Unmanned Aerial Vehicles (UAVs) will likely remain small in comparison to manned aircraft over the next 10 years High Altitude Long Endurance (HALE) seen playing a more significant role Possible global EADS market share: approx. 10% to 15% US market currently not accessible Objective: be the first player in Europe Main markets (HALE, MALE, Tactical and UCAV): US: 56% Western Europe: 22% EADS countries France, Spain, Germany: 13% Rest of World: 22% 18 9

10 3.6 New Systems: Air and Missile Defence Air and Missile Defence: Market Potential Total global Market Potential in 2005: approx. 2.7 bn Total global Market Potential until 2015: approx. 50 bn Possible global EADS market share: approx. 10% to 12% US market currently not accessible Objective to remain first player in Europe Main markets: NATO: NC3A as customer for any BMD related C3 / C2. Decisions for TMD programmes (based on national systems, ACCS, Test Bed). Germany: MEADS D&D contract in 2005 (850M ) UK: Major requirement changes & reduced bid for GBAD now LEAPP US: KEI (Kinetic Energy Interceptor) project only opened to the industry of allied Nations if political commitment is shown France: SAMP/T Block1 including M3R and Early Warning satellite demonstrator decided and funded France, Italy, UK: Aster missile system (Naval and Ground) Air/Missile Defence opportunities also arising in UAE, India 20 10

11 Contents 1. EADS in Defence: Challenges 2. Main achievements 3. Major Projects and Activities/ Market Potentials 4. Perspectives Perspectives for EADS in Defence Be a market leader in airborne systems and integrated defence and security solutions Actively support customers in their defence and security transformation process (e.g. NATO SACT, European Defence Agency) Profit orientation through effective project management and continuous improvement programmes; expansion into growth markets (GIS) Strengthen EADS role as a leading provider of new and innovative systems and solutions for all military services (army, air force, navy, space) and homeland security needs 22 11