Dassault Aviation : Transcript ENG "2021 annual results"

Dassault Aviation

2021 FY Results

March 4, 2022

Dassault Aviation 2021 FY Results		March 4, 2022
List of MAIN speakers	Company	Job title
Éric Trappier	Dassault Aviation	CEO

PRESS CONFERENCE

Éric Trappier

CEO

Good morning, and welcome to this press conference to report our 2021 business results. And for once you're in new premises, that is our auditorium. Physically present and also there are people attending the conference remotely. We're going to start this conference with a short video with the highlights of 2021.

At the end of 2021, the contract from Falcon Maritime's resilience and intervention [ph 00:00:42] programme, AVSIMAR, called Albatross, came into force. This contract was announced by the French Minister of the Armed Forces during a visit on November 19th to our plant in Seclin near Lille, where the Presidents of their Defence Committees of the National Assembly and the Senate were attending.

In accordance with the French military programme, the initial order is for seven aircraft to be delivered as from 2025 out of the planned total of 12, a symbol of the civil military [? 00:01:11]. This aircraft is based on the Falcon 2000LXS [ph 00:01:15] and will feature multi-radar under the fuselage, a high- performance [? 00:01:20] windows, search and rescue kit release system, and dedicated communication systems.

SLIDE MAIN TITLE

Video Speaker

On January 25th, 2021 in Athens, just four months after Greece expressed its intention to purchase, Éric Trappier signed two contracts for the acquisition of 18 Rafales and their associated logistical support. The ceremony was attended by the French Minister of the Armed Forces and the Greek Minister of Defence. The order for the 18 Rafales includes 12 aircraft currently in service in the French Air and Space Force and six new aircraft produce in Dassault Aviation plant.

The delivery ceremony for the Hellenic Air Force's first Rafale took place in Istres on July 21st, just six months after the contracts were signed. Today, the delivery of these first Rafale, number 401, shows that Greece, a European NATO member country, is willing to choose France, a proactive political choice, as is shown here. Buying American is not the only option. The Rafale is an omni-role, fighter aircraft who has unsurpassed operational capabilities on the international scene. It is combat proven and fully interoperable in particular with NATO.

The Rafale, whose acquisition and operating costs are well understood and managed, is constantly evolving based on the feedback from operational experience. The Rafale is undoubtedly at the forefront of technological innovation and will remain so for decades to come.

At the end of January, during her visit to our plant in Argonay, Haute-Savoie, where all Dassault's aircraft flight control [ph 00:02:56] systems have been produced since 1963, French Minister of the

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Dassault Aviation 2021 FY Results	March 4, 2022

Armed Forces, Florence Parly, announced her decision to order 12 Rafales to replace those being transferred to the Greek Air Force.

The Aero India trade show took place from February 3rd to five, 2021, to the Bangalore Air Base. France had the strongest foreign presentation at this event. This shows the French industry's commitment to contribute to the development of the aeronautical space and defence industries.

The Falcon 6X has made its first flight as scheduled on March 10th. The flight carried out by Bruno Ferry and Fabrice Valette lasted nearly two hours and a half hours and reached an altitude of 40,000 feet and speed of Mach 0.80.

This first flight was an opportunity to pay tribute to Olivier Dassault who had died a few days earlier. A keen aviation enthusiast, just like his grandfather, Marcel Dassault and his father Serge Dassault, he always supported the development of our business.

Since the end of June, now, three Falcon 6X are taking part in the fight test campaign, which is in full swing ahead of their entry into service scheduled for the end of 2021. System tests under actual operation conditions as well as flights with sustainable aviation fuel have begun, with almost 4,000 hours of testing, including 1,150 hours in flight. The Pratt & Witney Canada engine used on the Falcon 6X has received its Canadian certification. In late December, the first round of cold soak [ph 00:04:40] tests for the 6X took place in Iqaluit in Canada. A battery of tests were performed at temperatures of around minus 50 degrees Celsius.

The Falcon 6X layout has won the Private Jet Design Award and the Red Dot Design Award. This cabin, with fluid curves, has redefined the passenger flight experience. The interior layout is designed with innovative solutions in a state of the art hangar in our Little Rock plant in the United States, where the first production Falcon 6X, serial number five, landed on January 28.

In early May, Egypt announced its decision to acquire an additional 30 Rafales. This new order comes after the initial acquisitions of 24 Rafales that was signed in 2015. It also builds on the unwavering bond that has existed between Egypt and Dassault Aviation for nearly 50 years. Egypt is our second export customer to order additional Rafales. Our contract came into force in November 2021. It is a further demonstration of the aircraft's excellent operational and technical qualities that make it a commercial success in export markets.

The new Falcon was unveiled on May the 6th and quite happy to announce today the new Falcon is going to be the Falcon 10.

Due to the COVID pandemic, these virtual and digital launches made use of augmented reality to create a magical event. The Falcon 10X offers the largest, brightest and most comfortable cabin on the market for an unparalleled passenger experience. Its digital flight control system, or digital cockpit and carbon composite structure, make this new aircraft a benchmark product on the market.

Powered by two Rolls-Royce engines, the 10X will be able to travel up 14,000 kilometres. Our new flagship aircraft is scheduled to enter into service at the end of 2025. With two new high end Falcons in development - the 6X and 10X - Dassault Aviation is showing that it is committed to its future.

Dassault Aviation is listed in the first edition of the Financial Times, Europe's Climate Leaders 2021, a ranking of the 300 companies that have succeeded the most in reducing their greenhouse gases emissions. Dassault Aviation is developing new industrial processes and optimising the existing ones to reduce its carbon footprint. The Falcon range is already capable of flying with sustainable fuels.

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Dassault Aviation 2021 FY Results	March 4, 2022

Dassault Aviation co-organised the Paris Region AI for Industry Challenge 2021 with the Ile-de-France region, in which ten start-ups took part. The goal was to use AI algorithm to develop virtual sensors. The jury for the challenge declared the winners to be the consortium formed by Aquila Data Enabler and the ISAE Supméca Quartz laboratory. The awards ceremony took place on May 28th at the Bourget airport.

This is a result of an innovative partnership between the Dassault Aviation and the engineering school of the ISAE Group. The company is taking part in the Euroglider project, which aims at developing an electrical power two seater glider for teaching, release and training. It falls within the scope of the Clean Sky 2 programme with three considerations: operational, environmental and economic. It also shows how invested Dassault Aviation is alongside schools in shaping the aerospace industry of the future.

On June 18th, the Chiefs of Staff of the three countries were also in the SCAF programme and met with our CEO in Saint Cloud. The first result of the technical and operational studies on the NGF were presented to the French, German and Spanish Generals, accompanied by their delegations.

Dassault Aviation has partnered with CNRS to create a joint research laboratory dedicated to the creation of breakthrough technologies for materials used in acoustics, electromagnetism and anti- icing [ph 00:08:50], named Innovative Functional Materials for Aviation, Moliere in French. This research will benefit the aircrafts of tomorrow, both in the civilian and military sectors. This initiative shows how Dassault Aviation is constantly striving to be more innovative.

For the third year in a row, Dassault Aviation ranked first in the AIN Satisfaction Survey on the support of the fleet of business aircraft, with 5% increase in its overall score compared to 2020.

The new building at our Mérignac plant was inaugurated on September 21st. It hosts a study development and after sales support teams for the company's civilian and military activities. As part of our transformation plan, this building will enable the transfer to Mérignac of some activities based in Saint Cloud to be closer to our aircraft production and in service. This new building, along with some existing ones, will therefore accommodate the defence customer support, Falcon aircraft service's industrial operations, procurements and design office teams. However, for the design office, the centre of gravity will remain in Saint Cloud.

With a total capacity of 26,000 square meters the new building features 1,650 workstations, 24 modular collaborative spaces, and nine project offices. The company is continuing with its transformation plan, Leading Our Future, which has already performed very well in enabling Dassault Aviation to remain competitive in an ever changing world.

On November 25th in Zagreb, this State-to-State contract was signed in the presence of the President of the French Republic and the Prime Minister of the Croatian Republic for the acquisition of 12 Rafales from the French Air and Space Force. Croatia has also signed a logistical support contract with Dassault for all the necessary resources with a three year extension. The Ministry of Armed Forces confirmed that the 12 preowned Rafales sold to Croatia would be replaced by new ones for the French Air and Space Force.

In mid-October, Dassault Aviation was presented at the NBAA trade show in Las Vegas, a key event for business aviation. A full scale model of the Falcon 10X cabin was exhibited for the first time alongside for the Falcon 6X. The Falcon 8X was also presented to the many guests in attendance.

For its 20th year participating in the Race of the Heart, a team sponsored by Dassault won the event. This is no small feat. For four days and four nights, racers take part in various challenges along the 700

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Dassault Aviation 2021 FY Results	March 4, 2022

kilometres from Paris from Les Arcs Bourg Saint Maurice to raise awareness on organ donation and transplant.

Dassault Aviation exhibited the mock-up of the 6X cabin at the Dubai Air Show in November, as well as the Falcon 8X, which made the trip with sustainable fuel. This edition of the Dubai show confirmed the sign of recovery in the business aviation market. A flight demonstration of the Rafale was also given by the French Air and Space Force.

The Rafale chosen by the United Arab Emirates to equip their army. On December 3rd, our CEO, Éric Trappier, signed a contract in Dubai for the supply of 80 F4 for the UAE Air Force. This took place in the presence of the President of the Republic, Emmanuel Macron, and Sheikh Mohammed ben Zayed Al Nahyane, Crown Prince of Abu Dhabi and Deputy Commander of the UAE armed forces. This contract is the most important in the history of Dassault Aviation and is the result of more than 40 years of trust between the UAE and our company through the Mirage family and in particular, the Mirage 2000-9. It is yet another demonstration of the excellence of the Rafale in the French aviation industry.

The French Ministry of the Armed Forces Directorate of Aeronautical Maintenance awarded Dassault Aviation a new generation contract BALZAC to support the Mirage 2000 fleet of the French Air and Space Force. This contract follows on from the Rafale contracts, which guarantees excellent availability of the Rafales owned by the armed forces. With a period of 14 years, these verticalized [ph 00:13:03] contracts include an all through [ph 00:13:07] maintenance activities for the French Mirage 2000 until their retirement.

On January 19th, six Rafales by Greek Air Force crews took off from our Istres site to the Tanagra air base. Our was the guest of the ceremony presided by the Greek Prime Minister. The entry into operational service of these first six Rafales in the Hellenic Air Force [? 00:13:32] clearly demonstrated the strong partnership between France and Greece, just one year after the signature of the contract for 18 aircraft.

Dassault Aviation was also present alongside GIFAS and the French Air and Space Force during the second edition of the La Fabrique Défense Trade Show in Paris in late January. For three days, defence and industry professionals gave a large number of young people the opportunity to discover the challenges of defence and to find vocations, training opportunities and professions for the future.

On February 10th, Éric Trappier and Air Vice Marshall, Yusuf Jauhari, Head of the Defence Facilities Agency of the Indonesian Defence Ministry, signed a contract in Jakarta for the purchase of 42 latest generation Rafale aircraft in the presence of French Defence Minister, Florence Parly. Indonesia is the eighth country to purchase Rafale aircraft, the seventh international customer, and the first ever customer equipped with Dassault combat aircraft to acquire new Rafales.

CONTEXT

Éric Trappier

CEO

Thank you for watching this film, which summarises the activity of the full year.

First to recall the current context, especially that of the war in Russia, in Ukraine, and this is taking over all the other topics for the moment. We are also affected by what the Ukrainians are going through, and we have activities in Russia, sales of Falcons, and of course, there will be altered because

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