Safran : Exane 24th CEO Conference 2022

Safran

Exane 24th CEO Conference 2022

June 15, 2022

Pascal BANTEGNIE

Chief Financial Officer

Disclaimer & foreword

FORWARD-LOOKING STATEMENTS

This document contains forward-looking statements relating to Safran, which do not refer to historical facts but refer to expectations based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance, or events to differ materially from those included in such statements. These statements or disclosures may discuss goals, intentions and expectations as to future trends, synergies, value accretions, plans, events, results of operations or financial condition, or state other information relating to Safran, based on current beliefs of management as well as assumptions made by, and information currently available to, management. Forward-looking statements generally will be accompanied by words such as "anticipate," "believe," "plan," "could," "would," "estimate," "expect," "forecast," "guidance," "intend," "may," "possible," "potential," "predict," "project" or other similar words, phrases or expressions. Many of these risks and uncertainties relate to factors that are beyond Safran's control. Therefore, investors and shareholders should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: uncertainties related in particular to the economic, financial, competitive, tax or regulatory environment; the risks that the new businesses will not be integrated successfully or that the combined company will not realize estimated cost savings and synergies; Safran's ability to successfully implement and complete its plans and strategies and to meet its targets; the benefits from Safran's plans and strategies being less than anticipated; the risks described in the Universal Registration Document (URD); the full impact of the outbreak of the COVID-19 disease; the full impact of Russia-Ukraine situation.

The foregoing list of factors is not exhaustive. Forward-looking statements speak only as of the date they are made. Safran does not assume any obligation to update any public information or forward-looking statement in this document to reflect events or circumstances after the date of this document, except as may be required by applicable laws.

USE OF NON-GAAP FINANCIAL INFORMATION

This document contains supplemental non-GAAP financial information. Readers are cautioned that these measures are unaudited and not directly reflected in the Group's financial statements as prepared under International Financial Reporting Standards and should not be considered as a substitute for GAAP financial measures. In addition, such non-GAAP financial measures may not be comparable to similarly titled information from other companies.

ADJUSTED DATA

All revenue figures in this presentation represent adjusted data (except where noted). Safran's consolidated income statement has been adjusted for the impact of:

• purchase price allocations with respect to business combinations. Since 2005, this restatement concerns the amortization charged against intangible assets relating to aircraft programs revalued at the time of the Sagem- Snecma merger. With effect from the first half 2010 interim financial statements, the Group decided to restate:
• • the impact of purchase price allocations for business combinations, particularly amortization and depreciation charged against intangible assets and property, plant and equipment recognized or remeasured at the time of the transaction and amortized or depreciated over extended periods due to the length of the Group's business cycles and the impact of remeasuring inventories, as well as
  • gains on remeasuring any previously held equity interests in the event of step acquisitions or asset contributions to joint ventures
• the mark-to-market of foreign currency derivatives, in order to better reflect the economic substance of the Group's overall foreign currency risk hedging strategy:
• • revenue net of purchases denominated in foreign currencies is measured using the effective hedged rate, i.e., including the costs of the hedging strategy
  • all mark-to-market changes on instruments hedging future cash flows are neutralized
• The resulting changes in deferred tax have also been adjusted.

ORGANIC GROWTH

• Organic variations were determined by excluding the effect of changes in scope of consolidation and the impact of foreign currency variations.

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An international high technology group in Aerospace & Defense

76,800	€15.3bn	125 years	No.3
employees	2021 adjusted revenues	of history	WW aerospace company
			(excluding aircraft manufacturers)*
Aerospace		Equipment	Aircraft
Propulsion		& Defense	Interiors

Source Safran * Classification criteria: revenue

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Strong leadership positions

2021 adjusted revenue (€15.3bn)

by division

Aerospace €7.4bn Propulsion

#1 WW through CFMI for narrowbody engines #1 WW in helicopter turbine engines

Strong positions in European military programs: fighter and transport

#2 WW in Seats (BFE**) with strong presence on business/high end

#1 WW in cabin interiors (mainly SFE***)

ServicesOE

62%66%

OE	OE	Services
38%	34%
	72%
	Services
	28%

Equipment		€6.3bn
& Defense

#1 WW

• Landing gear, carbon brakes

• Electrical power distribution

• Electrical wiring

• Evacuation slides

#2 WW

• Oxygen systems

• Engine nacelles & gearbox

#1 Europe

Aircraft €1.5bn

Interiors

Source Safran

* including retrofit activities **BFE: buyer-furnished equipment ***SFE: supplier-furnished equipment

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• Navigation & Optronics

Original Equipment						Services

This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran

Robust business model performing throughout crisis

Adjusted revenue

€24.6bn
	€16.5bn		€18-18.2bn
	€15.3bn
FY 2019	FY 2020	FY 2021	FY 2022
			guidance

Adjusted recurring operating margin

15.5%			13.0%
		11.8%
	10.2%
FY 2019	FY 2020	FY 2021	FY 2022
			guidance

Free cash flow

€2.0bn			€2.0bn
		€1.7bn
	€1.1bn
FY 2019	FY 2020	FY 2021	FY 2022
			guidance

CONTROL OVER COST BASE AND CASH OUTFLOWS

2020-2021: operating margin maintained above 10% and free cash flow at €1+bn/year throughout the crisis

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This document and the information therein are the property of Safran. They must not be copied or communicated to a third party without the prior written authorization of Safran