Dassault Aviation : Transcript ENG “2022 first half-year results” | MarketScreener – Marketscreener.com

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Dassault Aviation : Transcript ENG “2022 first half-year results” | MarketScreener – Marketscreener.com

Dassault Aviation

2022 First half‐year


20 July 2022

Dassault Aviation: 2022 First half‐year results

20 July 2022

List of MAIN speakers


Job title

Éric Trappier

Dassault Aviation



JULY 20, 2022

Éric Trappier


Good afternoon. Welcome to this press conference on the half yearly accounts for the first half of 2022. Welcome to all those who are here and those who are connected online. And as usual, we’re going to begin with a film summarizing the events of this first half of 2022.

Video Speaker

The Rafale chosen by the United Arab Emirates to equip their air forces in December, our CEO, Éric Trappier, signed a contract in Dubai for the supply of 80 Rafale aircraft to the UAE Air Force. The signing took place in presence of the President of the Republic, Emmanuel Macron, and Sheikh Mohamed bin Zayed Al Nahyan, then Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE armed forces. It is the largest contract in Dassault Aviation’s history. Its effective date was announced on 19th of April 2022. It is the result of more than 45 years of trust between the UAE and our company through The Mirage family, and in particular The Mirage 2009 [ph 00:01:23].

It is yet another demonstration of the excellence of the Rafale and the French aviation industry. The Rafale demonstrates its versatility, efficiency and reliability daily in many theatres of operation. It continuously integrates feedback from the armed forces and the latest innovations to stay at the cutting edge of technology.

The French Ministry of the Armed Forces, Directorate of Aeronautical Maintenance, has awarded the Dassault Aviation a new generation contract, Balzac, to support the French Air and Space Forces’ Mirage fleet. This follows from the Ravel [ph 00:02:00] contract which guarantees excellent Rafale availability for the armed forces. Covering a period of 14 years, this verticalized contract includes all through life maintenance activities for the French Mirage 2000, excluding the engine and the ejection seat.

On January 19, six Rafales flown by the Greek Air Force’s crews, took off from an east side to the Tanagra Air Base. Our CEO was a guest at the ceremony, presided over by the Greek Prime Minister. The entry into operational service for these first six Rafales in the Hellenic Air Force 332 [ph 00:02:33] Squadron clearly demonstrate the strong partnership between France and Greece, just one year after the signature of the contract for 18 aircraft.

On March the 24th, the CEO and the Greek Defence minister signed a new contract for six additional Rafales in Athens in the presence of the French Minister of the Armed Forces. This will bring the number of Rafales operated by the Hellenic Air Force to 24. This year, two Greek Rafales also took part in the traditional 14th of July parade. Among [? 00:03:05] a total of 44 Dassault aircraft mobilised for this national day.

In late January, Dassault Aviation attended the second edition of La Fabrique Défense trade show in Paris alongside GIFAS and the French aerospace [? 00:03:16]. For three days, defence and industry


Dassault Aviation: 2022 First half‐year results

20 July 2022

professionals gave a large number of young people the chance to discover the challenges of defence and to find vocations, training opportunities, and professions for their future.

On February the 3rd and 4th, Dassault Aviation took part in the Aviation Summit in Toulouse, an event which was organised as part of French presidency of the European Union. We showcased the Falcon [? 00:03:42], operational, our combined vision system for optimising approaches to demonstrate how improving flight operations can reduce carbon emissions.

The company has been contributing for numerous years to the European Clean Aviation and CESAR [ph 00:03:57] Environmental Research programme as well as Corac [ph 00:03:59] in France.

On February the 10th, Éric Trappier and Air Vice Marshal Yusuf Jauhari, Head of Defence Facilities Agency for 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. Once the contract comes into effect, Indonesia will become the eight country to purchase a Rafale and the seventh international customer and the first country having never had a Dassault aircraft to acquire new Rafales.

The contract for the supply of 20 MALE Eurodrone systems, i.e. 60 aircraft and their support for five years, was signed at the end of February by OCCAR and Airbus Defence and Space, which is the prime contractor for the programme. Dassault Aviation is one of the first three main subcontractors. It is specifically responsible for flight controls and mission communications.

The CASAC research and training chair were set‐up in 2016 under the impetus of Dassault Aviation and the ISAE‐SUPAERO Foundation with the aim of rethinking the relationship between cruise [ph 00:05:09] and the systems used in aviation. The initial results have been promising and we have renewed our partnership for an additional three years.

The Dassault team has won the Course du Coeur race in support of organ donation for the second year running. 850 kilometres from Paris to Les Arcs are covered in four days and four nights in the spirit of cohesion and solidarity. It’s a sporting success and, above all, a human achievement, without, of course, forgetting the core message, which is to promote organ donation.

In 2022, as in 2021, Dassault Aviation was designed on one of the Europe climate leaders by The Financial Times. This ranking acknowledges the 400 European companies having made the most significant reforms to reduce the intensity of their greenhouse gas emissions. The method used for this year’s ranking was even stricter than that used previously. We are one of the five aerospace and defence companies to be present in this ranking.

Dassault Aviation has moved up this year in the Universum 2022 ranking for most attractive employer for engineer school students, all fields combined [ph 00:06:18]. Dassault Aviation is positioned fourth amongst the top 100 most attractive employers, which is one of the best positions we’ve ever had. For the past decade our company has appeared consistently as one of the top ten companies preferred by engineer school students.

The EBACE Convention exhibition took place in Geneva for May 23rd to 24th. The first time we set‐up a full scale Falcon 10X [ph 00:06:44] cabin at our exhibition booth. This attracted numerous visitors, all impressed by the new aircraft’s interior and the quality of design. We were present able to present the Falcon 6X for the first time to customers and the press, exhibited in the static display along the 8X and the 2000LXS. At the press conference, Éric Trappier confirmed that all the technical steps for the 6X required for certification are going as planned. The CEO has also explained that given the pressure


Dassault Aviation: 2022 First half‐year results

20 July 2022

placed by the COVID epidemic on the company and our partners and suppliers, Dassault has taken the reasonable decision to postpone the 6X launch by six months ‐ now scheduled for mid‐2023.

The Falcon 6X first production has completed a world tour with its team of onboard engineers and technicians. This summer the 6X will be facing the hot Middle East weather. Then it will fly low altitude routes over the desert to test the peak efficiency of the environmental control system. This follows on from the extreme cold tests which were carried out last year in Iqaluit in Canada where the aircraft was tested at minus 37 degrees Celsius. The first customer aircraft are currently being finalised at our Little Rock facility in Arkansas.

For over 20 years, Dassault Aviation has been a close partner of the Les Chevaliers du Ciel association, organising the ‘Rêves de gosse‘ initiative, aimed at realising the dreams of disabled children. A nine‐ stop aerial tour is organised to promote inclusion and acceptance of differences by giving ordinary and extraordinary children battered by life or illness and opportunity to meet. With the help of volunteer crews, the association is able to offer about 1,500 children a first flight.

On the occasion of various site visits carried out in the first half of the year, Éric Trappier and [? 00:08:39] were able to check the progress on the Dassault Aviation Transformation Plan. On June 28th, the CEO visited Mérignac, where he enjoyed the exciting presentations at the New Generation Science Day organised simultaneously in Saint‐Cloud, Istres and Mérignac by the Direction Générale Technique. Éric Trappier witnessed the latest lab development, in particular the 10X wings mounted on test equipment and the conditioning laboratories.

While on the same trip, the CEO presided over a ceremony in honour of the martyrs of the aeronautics industry in front of the statue [ph 00:09:17] dedicated to the memory of workers and members of the resistance who died or who were shot or deported during the Second World War.

Today at our own level we’re striving to ensure that France continues to keep control of its destiny with powerful tools that will guarantee its freedom of decision and action. In a troubled world, we refuse subjection and withhold our spirit of resistance to defend the independence of our country and its armed forces. This is not always understood. Nevertheless, it is undoubtedly a major feature of a corporate culture which has been transmitted to us by Marcel and Serge Dassault, and by all those memories engraved on this [? 00:09:54].

On July the 8th, General Stéphane Mille, Chief of Staff of the French Air and Space Force and our CEO, Éric Trappier, inaugurated the [? 00:10:10] to the Rafale 70 Years of Industrial and Operational Excellence Exhibition. An example of each of these aircraft will be on display throughout the summer in front of the prestigious Hôtel National des Invalides in Paris; an opportunity to remind ourselves that the Rafale is the result of 70 years of technological achievements in French jet fighters and that it was begun with [? 00:10:29].

Les Invalides is one of the greatest symbols of military prowess, a field in which aviation has secured a prominent place in times of war. It cannot accomplish everything, but nothing can be accomplished without it. There can be no modern and efficient army without combat aircraft.

And at the same time there cannot be combat aircraft without an efficient industry. Jet fighters are the human achievement that concentrates the most critical technologies in such a small volume. It is so complex that only three or four countries in the world, including France, currently have the knowhow to master and build a combat aircraft with no outside help. Mastering this complexity is a slow learning process, a process of cumulation, maturation, and knowledge transfer from one generation to the next.


Dassault Aviation: 2022 First half‐year results

20 July 2022

You cannot cut corners. We were able to develop the Rafale before we had already succeeded with Mirage 2000, and this was possible thanks only to the Mirage F1 and [? 00:11:32]. Aviation is an industry shaped by cumulative experience. You cannot become an aircraft manufacturer overnight.


Éric Trappier


So, after these beautiful pictures, we’re going to present the results.

First of all, a few highlights. The highlights for the first half is a record‐breaking order intake with the export Rafales and especially those of the UAE, AT, Greece for six additional aircraft and a strong recovery of Falcon orders with 41 Falcon ordered this first half.


At the same time, the new difficulty is the difficulty because of the crisis you have gone through, this creates a certain complexity in the supply chain, and the shortage of workforce that we can see in our company and in all the companies that contribute to the building of our aircraft.


The context. You know about the context. It’s a difficult context between Russia and Ukraine with the war in Russia, a global health crisis that is still persisting. Although we thought that the COVID was behind us, actually at the beginning of this year, in January, we were still hit. We went back to working from home. Some countries closed their borders, like China, and there was a re‐emergence of the virus. And it still is the case now.

The presidential elections in France, with the re‐election of President Macron, the Legislatives that didn’t give any majority to any party, and so a new formula in the Fifth Republic in terms of our government. These crises created high inflation that you can see today, and this might remain at this very high level, and so we’re beginning to see signs of concerns about growth and our supply chain is under pressure.

It has started again with our Rafale and Falcon successes, but also with the recovery of Airbus. So the ramp‐up is once again the topic and after two years of whatever might happen in France, this intensive going back to work is difficult, especially since we have shortages in terms of our resources and energy is also going to weigh on this issue, in terms of our supply chain and socially also because of inflation. So therefore we have a very complex environment.


As for the Ukraine crisis, sanctions have been decided by the EU and by the United States and by other countries. So we complied with these sanctions, and we implemented in Dassault and for our subcontractors the whole issue related to these sanctions. So, this means freezing all our plants in Russia. We had an office in Moscow in the civil area for our Falcons. We had a subsidiary of Dassault Falcon services to support our Falcon aircraft locally, falcons that are operating in Russia therefore, and we stopped and seized all our commercial activities, our sales of aircraft to that country. There are some counter‐sanctions also in certain areas that have affected us and our supply chain.


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