SAFRAN - 2020 Integrated Report

IN 2021, SAFRAN WILL CONTINUE TO DRAW STRENGTH FROM ITS ADAPTABILITY EDITORIAL I n 2020, Safran published results that were as good as could be expected given the severe crisis affecting the aerospace industry, confirming the strength of its business model and the impact of the cost reduction measures taken during the year. While implementing the necessary health measures to enable a safe return to work for its employees, Safran reacted rapidly by accelerating the streamlining of its sites and demonstrating organizational flexibility. Our business was heavily impacted by the crisis, with 2020 revenue down by 33.0% on 2019, at €16.5 billion. Despite the decline, Safran posted recurring operating income (1) of €1.7 billion (for a recurring operating margin (1) of 10.2%) and free cash flow of €1,073 million. Our financial targets for 2020, as reviewed in July 2020, were all reached. Thanks to the commitment of its employees across the world, Safran swiftly implemented the adaptation plan drawn up in March, showing determination in the face of the crisis and adjusting its capacities to its customers’ needs. The total workforce fell by more than 16,500 people (over 21,000 including temporary staff), from around 95,400 employees at the end of 2019 to around 78,900 at the end of 2020. In France, the Group Activity Transformation Agreement signed in July brought in measures including long-term short-time working (covering up to 40% of working time), in order to preserve skills in production as well as research and technology. Safran also streamlined its industrial footprint, with a number of site closures and production transfers in several regions of the world. Safran is committed to offering an effective response to the major challenge of climate change, which will prove an essential factor in the ongoing acceptability of air transport. Its strategy seeks to reduce greenhouse gas emissions from its operations and its products. Innovation is a central feature of the major shift under way. With its broad coverage of aircraft systems, and propulsion systems in particular, Safran is capable of offering technological solutions. Safran has robust fundamentals, and the Board of Directors stands firm in its support of the new Chief Executive Officer on Group-wide efforts to emerge from the crisis in stronger shape and face the future with confidence. The Board of Directors is fully aware of the strategic importance of the climate challenge, and will be working with the Director responsible for monitoring climate issues to ensure the Group achieves its climate roadmap. ROSS McINNES S A F R A N 2 0 2 0 I N T E G R AT E D R E P O R T I 2