Focus on Security Business

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Hervé Guillou

Head of Defence and Communications Systems

Global Investor Forum 2009,

Broughton, 1

st

_{& 2}

nd

_{April 2009}

EADS Security & Defence

Focus on Security

Business

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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 forward-looking statements. For a discussion of factors that could cause future results to differ from such forward-forward-looking statements, see EADS’ “Registration Document” dated 24th April 2008.

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.

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Security Market for EADS

Business Growth, Risks and Opportunities

EADS Business Model

Lead System Integration (LSI)

Products and Solutions

Conclusion

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Global Security Market Evolution

Sources: Estimation based on Civitas 2006, EADS DS estimates

Evaluation of DCS' global security accessible market (M€)

Emergency response 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 20000 Protection of Population Critical infrastructure Maritime Security Border Security 2008 09 10 11 12 13 14 15 16 17 18 19 2020

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 2015

CAGR 0 8-14 = 8.9 % CAGR 15-2 0 = 2%

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Competitors Landscape

by Mission Type

Protection of the population Protection of the population Critical Infrastructures & Sites Protection Critical Infrastructures & Sites Protection Border Security Border Security Crisis & emergency response Crisis & emergency response Maritime security Maritime security

LSI approach

Products appr

oach

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Security Market for EADS

Business Growth, Risks and Opportunities

EADS Business Model

Lead System Integration (LSI)

Products and Solutions

Conclusion

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Growth Drivers

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

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

Telecoms & IT convergence

• E.g. broadband solutions, enabling enhanced situation awareness, as major driver

Defence & security convergence

• Security requirements of defence and governmental customers converging (resilience, sharing of information )

Defence & security convergence

• Security requirements of defence and governmental customers converging (resilience, sharing of information )

Integrated Systems

and LSI

Telecoms

IT

Industrial footprint in Middle East & North Africa Industrial footprint in Middle East & North Africa

Security

Defence

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Generation of local value e.g. Middle

East and North Africa

EADS Security Strengths

Finding the best solution for

our customers e.g. via the

System Design Centre

EADS integrated approach

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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)

0.3 0.9 0.3 2.5 0 0.5 1 1.5 2 2.5 3 2000 2008 Revenues in Bn€ Backlog in Bn€

EADS Security Business Growth

• 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

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Security Market for EADS

Business Growth, Risks and Opportunities

EADS Business Model

Lead System Integration (LSI)

Products and Solutions

Conclusion

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EADS

DS

Offer

Security Objectives

-

Protection of critical assets (oil

& gas, refineries, energies etc..)

- Harbours Critical Infrastructures & Sites Protection

- Surveillance of land, coastal and maritime borders and checkpoints - Airspace surveillance Protection of the population - Public safety (police, fire, rescue) - Major event security - Coordination of governement forces 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 Crisis & emergency response - Prevention & Plans definition - Emergency calls management (112) - Major crisis management: eg: Natural disasters, Industrial accidents Blackmail, etc..

EADS Global Security Market Clusters

Market addressed through two business model approaches: LSI and based on

our missions critical communications system portfolio

Border Security

A mission-critical communications system is a crucial element in all these global security solutions

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EADS LSI Selected References

UK Fire Service

modernisation

Qatari Border

Surveillance

Land Border EEZ TW Coastline Land Border -> Full coverage EEZ -> Coverage of vital areas Territorial Waters -> Full coverage Coastline -> Full coverage Land Border EEZ TW Coastline Land Border -> Full coverage EEZ -> Coverage of vital areas Territorial Waters -> Full coverage Coastline -> Full coverage

French Spationav

Coastal

• Strengthen EADS position

• Develop a deep understanding of required LSI key capabilities

• Improve customer intimacy

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EADS Defence and Security is the World

Leader in Maritime Security

Kongsberg

EADS

HITT

40 %

e.g. 2008 Market

share

27% 10%

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Security Market for EADS

Business Growth, Risks and Opportunities

EADS Business Model

Lead System Integration (LSI)

Products and Solutions

Conclusion

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The Value Chain of Critical Call Taking

CITIZENS

Call reception

localization

and mapping

Call dispatch

Emergency

Call

911 / 112

Govt forces

coordination

Business critical

communication

Police

communication

Fire brigades

communication

Medical urgency

communication

Defense

communication

Office kit

Emergency

Notification

Reverse 911/112

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EADS Digital PMR Network

Deliveries

More than 190 networks in over 65 countries based on Tetrapol,

P25 (developed) and Tetra (acquisition of Nokia Business)

~550 ~90 ~550

Selex

EADS

Motorola

Revenues 2008

in € Mio estimates

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Last Security Acquisition: Plant CML

Public Safety Answering Point (“PSAP”): A facility equipped and staffed to receive 9-1-1 calls Public Safety Answering Point (“PSAP”): A facility equipped and staffed to receive 9-1-1 calls

• 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

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Security Market for EADS

Business Growth, Risks and Opportunities

EADS Business Model

Lead System Integration (LSI)

Products and Solutions

Conclusion

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