(AOF) – Thales and Schiebel (Austrian producer of mine detectors and drones) have been awarded a contract by the British Ministry of Defense for the delivery of a rotary wing unanchored aerial system (UAS) which will provide a “eye in the sky” protection to Royal Navy warships. This contract, for the Peregrine program, is to deploy a rotary-wing tactical drone equipped with powerful maritime surveillance sensors to protect a Type 23 frigate in operation.
Thales will act as the primary systems integrator for the program which brings together an unrivaled combination of proven Schiebel UAS capabilities and a range of high-precision intelligence, surveillance and reconnaissance sensors and systems from Thales.
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Key points
– First or second in electronics for civil satellites, mission systems and sensors for defence, air traffic management, data protection and SIM cards and smart payments, created in 2020;
– Revenues of €17 billion from defense & security for 54%, aerospace for 28%, digital identity and security for 19% and civil aeronautics for 7%;
– International presence, 24% for France, 29% for other European countries, 14% in Asia, 12% in North America and 9% in the Middle East;
– Business model based on 4 pillars: the strength of R&D, at 20% of sales, synergies between businesses drawn from a deep knowledge of the markets, an extensive base of digital assets and a global presence in + 50 countries ;
– Capital locked by 2 shareholders in concert, Dassault Aviation (24.63%) and the French State (25.68%), Patrice Caine being Chairman and CEO of the 16-member Board of Directors;
-Sound financial position with debt rated A-, sharply reduced to €894m at the end of June compared to €7.6bn in equity.
Challenges
– Strategy to refocus on aerospace, defense & security and digital identity & security;
– Innovation strategy supported by R&D close to 20%:
– global ecosystem bringing together 1/3 of the workforce, with a portfolio of more than 23,000 patents, 6 hubs, 3 digital factories and 50 academic partnerships;
– focus on 5 digital areas of expertise: connectivity, bid data, cybersecurity and artificial intelligence, via the AI@Centech program and the quantum TrUE AI approach;
– Low carbon environmental strategy:
– 25% reduction in direct CO2 emissions in 2023, 50% in 2030 (vs 2018) and net zero objective in 2040,
– 100% of eco-designed products and services by 2023,
– launches of green loans,
– 4 priorities: environmental management, flight optimization, air traffic management, training and signaling;
– Acceleration of activities, obtaining contracts and investments in defense and security (2/3 of estimated profits) and aerospace (15%);
– Acquisitions of Excellium and S21sec (security division) and AAC (sonars);
– Visibility with a record order book boosted by the entry into force of Rafale sales in the United Arab Emirates and, more generally, by Defense & Security needs.
Challenges
– Tensions in supply chains, in particular semiconductors and inflation: resilience of supply chains, ramping up of recruitment and transfer of purchasing costs to customers;
– Impact of advances in avionics and biometrics with the resumption of air traffic and then R&D investments in quantum sensors, cloud security and data processing in IoT;
– Pace of aerospace orders lower than that of the group;
– After a jump of 41% in order intake and 9.6% in revenue at the end of September 2022, 2022 objectives confirmed: revenue up close to 5.5% and operating margin of 10.8 to 11, 1%.
– 2022 interim dividend of €0.70 paid in December and share buybacks.
The end of a duopoly?
For several decades, the American Boeing and the European Airbus have shared 99% of the world market for airliners with more than 110 seats. This market weighs more than 100 billion dollars per year. However, this duopoly seems to be weakened in 2022 for several reasons. First, for the first time, two medium-haul single-aisle aircraft, the Chinese Comac’s C919 and the Russian Irkut’s MC-21, are about to enter service. Added to this is the Boeing 737 MAX crisis. With the cessation of deliveries of this aircraft between 2019 and 2021, the production balance has been broken. In 2021 Boeing posted 340 deliveries, with Airbus remaining well ahead with 611.