EMBRAER DEFENSE AND SECURITY
Jackson Schneider
October, 27th 2015
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Sales of Super Tucano to the US Air Force
Several Achievements in Recent Years
KC-390 Program
Brazilian Satellite Program
Sisfron Pilot Project
Brazilian F-39 Gripen Program
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YTDSep
CAGR15%
Revenue Evolution
(US$ Millions)
Ref.: Sep, 2015.
New Challenges Started in 2015
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$ 1,100 - $1,250
$ 800 - $950
RevenueReduction
(US$ Millions)
50% BRL depreciationyear to date
Ref.: Sep, 2015.
Major Impacts in 2015
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Ref.: Sep, 2015
2015E2014
*Atech Bradar Savis Visiona
Diversified Portfolio of Products
Revenues Breakdown by Product
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BacklogEvolution
(US$ Billion)
Ref.: Sep, 2015.
Solid Backlog Despite 2015 Decline
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Book to BillAbove 1 X
Ref.: Sep, 2015.
50% BRL devaluation year to date
Backlog Reduction Driven by FX
This information is property of Embraer and can not be used or reproduced without written permission.
Main Focus
Finalize KC-390 Development
Improve Operational Efficiency
Increase International Sales
Adjust Programs to Brazilian Government Budget
This information is property of Embraer and can not be used or reproduced without written permission.
Main Focus
Adjust Programs to Brazilian Government Budget
This information is property of Embraer and can not be used or reproduced without written permission.
High Exposure to Brazil
* Estimated
Revenue Breakdown by Region
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AM-X (A1-M)
A-4 (AF-1)
F-5
AEW&C5 a/c - (TBD)
Scaling Down Aircraft Modernization Programs
Reduced from 43 to 14 a/c
12 a/c1st batch
46 a/c - delivered
2nd batchReduced from 11 to 03 a/c -
ongoing
This information is the property of Embraer Defense & Security and may not be used or reproduced without written authorization from the companyThis information is the property of Embraer Defense & Security and may not be used or reproduced without written authorization from the company
Border Control & Protection (Sisfron)
• Integrated Systems Deployed and in Operation
• May 25th, 2015: demo to military attaches of 17 countries
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Satellite & Remote Sensing
Brazil Satellite Development
• Communication module mating (payload): 4th Quarter 2015
• Satellite Vibration Test conclusion: 1st Quarter 2016
• Launch Window: September 2016 to February 2017
Satellite Remote Sensing
• Imagery service to develop large remote sensing projects in Brazil and abroad
• One contract already signed
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Main Focus
Complete KC-390 Development
Adjust Programs to Brazilian Government Budget
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KC-390 Development: New Export Platform
• Around 85% of development concluded.
• Resumption of flight test campaign.
• Certification: From year end 2016 to 2H2017
• First delivery to Brazilian Air Force: From 1H2017 to 1H2018
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KC-390: Certification Process Advances
Ground Test Vibration Successfully Completed
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Finalize KC-390 Development
Increase International Sales
Adjust Programs to Brazilian Government Budget
Main Focus
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Broad Portfolio of Defense & Security Products
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C2
VSAT
AIR SURV.RADAR
GROUND RADAR
SECONDARYRADAR
VHF RADIO(voice)
C2
C2 MOBILE
GROUND RADAR VSAT
C2 FIXED
SATCOM
HUB
C2
VOICE COMMUNICATION
ATC BACKUP
TRAINING CENTERC3I CENTERMAIN ATC SYSTEMMETEO
Legacy
Super Tucano
Combined Sales Strategy
VHF RADIO(voice)
AIR SURV.
RADAR
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Photo: Senior Airman Ryan Callaghan/USAF
SUPER TUCANO – LAS
• Aircraft selected and contracted by the United States Air Force.
• 20 aircraft to be assembled at Jacksonville, FL.
• 12 aircraft delivered as of Oct 2015.
• High Fleet Availability.
This information is the property of Embraer Defense & Security and may not be used or reproduced without written authorization from the companyThis information is the property of Embraer Defense & Security and may not be used or reproduced without written authorization from the company
Super Tucano: US Light Air Support Program (LAS)
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High demand for Light Attack Platforms
SUPER TUCANO
99
25
8
12
18
16
21
Mali: 6 (NEW)
Ghana: 5 (NEW)
3
6
2
Super Tucano: Expanding our Footprint
Total Firm Orders
221
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KC–390: Multitask Aircraft with Global Penetration
• Fire fighting• Military Transport• Air-to-Air Refueling• Search and Rescue• Medical Evacuation• Humanitarian Aid
Missions• Troop & Cargo
Airdropping
>>
Letters of intent from5 countries for 32 aircraft.
Launch customer: Brazilian Air Force 28 firm orders
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Embraer Service and Support Footprint
Increasing Global Service Revenues
• 58 Contracts in place (+ 23% YoY)
• Backlog US$ 470 million (+ 77% YoY)
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New Brazilian Fighter (F-39 Gripen)
Contract between Embraer and Saab effective and running
First group of 44 people in Sweden to ToT process – Oct 2015
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• Contract between Embraer and Saab finalized (effective and running) – Sep 2015
• First group of 44 Brazilian engineers in Sweden – Oct 2015
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SABER-M60
2011
2011
OrbiSAR – RFP
2014
SENTIR-M20 SABER-S200R
2015
SABER-M200 SABER-M200VIG
2017
COMINT
2015
2014
BradarSAR 3000
2016
2016
SAD
2017GRADE
Radar Portfolio Expansion
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SKYFLOW AFTM (INDIA) - Air Traffic Flow Management Systems (ATFM)
42% deployedPhase I SAT finalized
Traffic Monitoring System
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OGMA: Bigger Portfolio & Diversification
Service portfolio evolution and diversification(New MRO production line for commercial and executive aviationaftermarket reinforcement)
Investments in service capabilities (Construction of a new state of the art painting hangar, Ultra-High Pressure Waterjet Stripping for engine manufacturing)
Increasing aero structures manufacturing capabilities(Acquisition of an Automated Riveting Machine, new production methods and 5 Axe Automated Machine)
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Main Focus
Finalize KC-390 Development
Improve Operational Efficiency
Increase International Sales
Adjust Programs to Brazilian Government Budget
This information is the property of Embraer Defense & Security and may not be used or reproduced without written authorization from the companyThis information is the property of Embraer Defense & Security and may not be used or reproduced without written authorization from the company
ModernizationA4, AMX and F-5
Final Assembly STStructural AssemblyWings: ST, KC-390Fuselage: KC-390
Final AssemblyKC-390
GPX Plant: Operational Gains
• Concentrate Operating Activities in the Gavião Peixoto (GPX) Site
• KC-390: Structure and Final Assembly Lines
• Gripen: New Gripen Design and Development Network
Gripen
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Production cycle reduced by 40%
Efficiency Gains: Super Tucano Example
• Significant improvement in inventory turnover
• Lower production lead time
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KC-390: Cost Reduction Initiatives
• Engineering costs: Fewer subcontractors and relocation to F-39 Gripen / E-2 Program.
• Production costs: Relocation to the E-2 Development Program.
• Administrative expenses: Downsized after reschedule.
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KC-390: Resumption of Flight Test Campaign
October 26th, 2015