Safran Sa Unspon/ Adr

Welcome to the Saffron first quarter 2026 revenue. At this time, I would like to turn the conference over to your host, Olivier Andries, Saffron CFO, and Pascal Montigny, Group CFO. Mr. Andries, please go ahead.

Thank you. Good morning, everyone, and thank you for joining us. We had a very strong first quarter with revenue reaching 8.6 billion euros, up 23% organically. We continue to benefit from a solid momentum in both aerospace and defense, with little to no impact from the Middle East conflict so far. Once again, our main growth driver is aftermarket. We saw vigorous demand across the board, especially for commercial engines, and nacelles. Sales of spare parts for civil aircraft engines were up 29%, mostly thanks to the CF-156. Services for civil aircraft engines increased by 43%, with LEAP red-per-cylinder contracts leading the way. At the same time, Basing on our excellent industrial performance in the second half of 2025, we continued the deep ramp-up, with more than 500 deliveries this quarter, up 63% year-on-year, and marking the third consecutive quarter with deliveries above this level. Overall, the strength of our Q1 performance reinforces our confidence in reaching the high end of our full year 2026 guidance. That said, we remain cautious for the coming months, given the uncertainty around the scale, duration, and potential impact of the Middle East conflict, notably on air traffic. A few words on our portfolio management. In January, we completed the divestment of staff from Passenger Innovations, And more recently, we announced the acquisition of a partner, Symfony, leader in resident navigation technologies for complex and denied environments. Turning to slide four, we continue to raise our industrial capacity for the in both civil and defense activities. We recently announced two new facilities to support Airbus, and Boeing ramp-up, one in Morocco, dedicated to the A320 landing gear, and another one in Belgium for compressor components, which will equip the LEAP, the GenX, and the GE9X engines. In addition, we just announced a $150 million investment in GenVilliers for a new 30,000-ton forging press. This will support the leap ramp-up, as well as our military program, further reinforcing our resilience in forged paths. In defense, we signed an MOU with FEDGROUP in the UAE for the development, the production, the commercialization of advanced air-to-ground weapon systems. This is yet another example of the momentum in our defense activities and our ability to forge meaningful partnerships. On the commercial side, we were pleased to see our Arius 2D helicopter turbine selected to power GIMBA's new Grand Cab G5 helicopter. We are also keeping a strong focus on innovation and future technologies. The NGIN-AUC electric motor was recently honoured of the 2026 Aviation Week laureates, marking a significant achievement as the first electric motor to be certified for hybrid and electric aircraft. It was also selected to power the fully electric Bristol B23 energy aircraft. With that, I will now hand over to Pascal to walk you through the Q1 revenue in more detail.

Thank you, Olivier. Good morning, everyone. Let me give you a quick update on FX. Earlier in the quarter, we saw the euro to dollar rate jump up to almost 121, but it then settled back down into a more favorable range between 114 and 116 in March, before stabilizing around 117 this week, largely in the context of the Middle East crisis. We use this environment to keep building out our hedging positions for 2029, And I'm pleased to say we are now 80% hedged for that year. In this context, we are confirming our 2026 hedge rate at $112 per euro. As of March 2026, our hedge books stood at $59 billion, which continues to give us strong visibility and protection against currency movements. Looking further ahead for 2027 and 2028, we are still targeting a hedge rate of $112. And for 2029, We are aiming for a range between 112 and 114 based on the market needs today. Now moving on to slide seven. In Q1 2026, our revenue reached 8.6 billion euros, which is a 19% increase year over year, or 23% organic. Organically, that's almost 1.7 billion euros more than last year, driven by both our services and original equipment businesses. On the currency front, we did see a negative impact of 8.5%, mainly because the average euro-dollar rate was less favorable, 117 in Q126 compared to 105 a year ago. In concrete terms, that meant a hit of about 600 million euros on our revenue. Lastly, scope effects had hit around 4%, mainly thanks to the acquisition of Collins Actuation and Flight Control Business last July. which contributed nearly 400 million euros. And this was partly upset by the divestment of Safran passenger innovations for nearly 100 million euros. Turning to slide eight, let me give you a quick overview of our revenue by activity. Starting with proportion. Revenue reached 4.6 billion euros, which is a 33% organic increase. The civil engine Safran market delivered a particularly strong performance, spare parts were up 29%, and the main driver here was, again, the CFM56, which benefited from a favorable comparison against Q1 2025. This strong resource also builds on the momentum we saw in the second half of last year, where we experienced a significant increase in work scope. In addition, the LEAP third-party network kept growing. Also, its revenues are still modest compared to the CFM56. Looking now at services, we saw a 43% increase, mainly driven by the LEAP rate per flight hour contracts, with volume, work scope, and also favorable comparison base, since margin recognition for the LEAP 1A only started in the second quarter of last year. On the OE side, we delivered 520 LEAP engines this quarter, up 63% year over year. This substantial increase reflects both a ramp-up marking three quarters in a row with more than 500 deliveries, and again a favorable comparison base. Moving on to equipment and defense, revenue grew by 13.5% organically year over year, or 11.9% if we exclude the transfer of the Safran ventilation system from aircraft interiors. We continue to support the ramp-up at Airbus and Boeing with deliveries of critical equipment, such as the Nacelle for the A320neo, or electrical systems and wiring for the 737 MAX, landing gear for the A330neo and the 787. In defense, we benefited once again from strong global demand, especially for electronics, inertial navigation systems, and guidance systems. Aftermarket services also grew for the board, particularly nacelles for the A320 and A380, and also for electrical systems and wiring on the A380. Turning to aircraft interiors, we saw a 9.2% organic growth, or 14.8% before the transfer of Safran ventilation system. Growth in original equipment was led by very strong cabin deliveries and favorable pricing in business class seats, despite lower volumes. Aftermarket services also increased, mainly driven by cabin activities for airlines in North America, Asia, and the Middle East. Turning to slide 9, we are continuing to deliver on our €5 billion share buyback program. In the first quarter of 2026, we repurchased 1.6 million shares, totaling €500 million. These shares are set to be cancelled by the end of the year, and I would like to highlight that a new tranche of €375 million of the buyback will be launched in the coming days. On the debt side, we redeemed the 700 million euros bond issued back in March 2021, as it reached maturity this March. This redemption has no impact on our net debt position, and our long-term debt profile, as shown on the graph, is long-dated and now primarily made up of bonds and USPP. Finally, just as a reminder, Safran will propose to its shareholder a dividend of 3.35 euros per share. for the 2025 fiscal year. This represents a total payout of 1.4 billion euros, scheduled to be paid on May 28. Olivier, back to you.