Industrial plan 2018-2022

"After a challenging 2017 in which we re-set expectations, we intend to deliver an Industrial Plan to return Leonardo to long-term sustainable growth. We face attractive market improvement, we are taking actions to leverage off a new commercial strategy, we enjoy a strong backlog, and we know we can invest well for growth in enhancing further core products and technologies. We have taken actions to address short-term issues in our world-class Helicopters business. 2018 is a consolidation year, and we are confident we are laying the seeds for a new phase of sustainable growth with steady improvement in our top line, profitability and cash flow, to create value for of all the stakeholders of the company”.

Alessandro Profumo, CEO of Leonardo

Taking action to return Group to sustainable growth over 2018-2022

• Well positioned for a positive market outlook
• Leveraging one company model with a new commercial strategy
• Leveraging a strong backlog and accelerating orders to deliver revenue growth and improved profitability
• Strict cost control and focused investment on sustainable growth
• Disciplined financial strategy to balance business growth, investments, and cash generation
   

Taken actions to address short-term issues in Helicopters business – underlining confidence in its strength

• A world class business with the right product strategy
• Very clear on what happened in 2017 – no structural issues
• Facing attractive opportunity in improving civil market
• Executing a sustainable plan to return to double digit profitability by 2020

Near-term guidance – 2017 guidance range reconfirmed; planting the seed for sustainable growth
 

FY 2017 Guidance  –  confirming the “reset” announced last November

• Revenues, EBITA and FOCF expected towards the lower end of guidance ranges
• Orders expected to be €11.3 – 11.7 bn due to timing of C27J export contract
• Group net debt in line with guidance; c.€2.6 bn including US bond buy-back

FY 2018 – a consolidation year

• Order growth, stable revenues and slightly higher EBITA €1,075 – 1,125 mln
• FOCF of c. €100 mln reflecting the timing of the EFA Kuwait financial profile, other customer advances winding down, Aerostructure performance and higher investment to support sustainable growth.
   

Medium term guidance – sustainable growth plan 2018-2022
 

• Targeting a new phase of sustainable growth, accelerating through to 2022
• 5 years 2018-2022 Order growth CAGR >6% supporting revenue growth CAGR of 5%-6% and a book-to-bill at or above 1x
• 5 years 2018-2022 EBITA CAGR of 8%-10%, with profitability expected to reach double digit by 2020
• Accelerating FOCF from 2020 driven by EFA Kuwait positive contribution, full recovery in Helicopters, growing orders and higher profitability; 2015-2018 Cash Flow Conversion[1] average of 50% will be the base for our plan going forward 
• Disciplined financial strategy, continuing to strengthen the balance sheet and target a return to investment grade