July Introduction to Chemring

Transcription

1 July 2013 Introduction to Chemring

2 Disclaimer 2016 Chemring Group PLC The information in this document is the property of Chemring Group PLC and may not be copied or communicated to a third party or used for any purpose other than that for which it is supplied without the express written consent of Chemring Group PLC. This information is given in good faith based upon the latest information available to Chemring Group PLC, no warranty or representation is given concerning such information (express or implied), nor is any responsibility or liability of any kind accepted, by Chemring Group PLC with respect to the completeness or accuracy of the content of or omissions from this presentation, and the contents of which must not be taken as establishing any contractual or other commitment binding upon Chemring Group PLC or any of its subsidiary or associated companies. Chemring Group PLC is under no obligation to revise, update, modify or amend the information in this document or to otherwise notify a third party recipient if any information, opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate regardless of whether those statements are affected as a result of new information, future events or otherwise. 2

3 Chemring Group FY15 Revenues m FY15 Operating Profit m Countermeasures Sensors & Electronics Energetic Systems Chemring revenues 125.8m 99.1m 152.4m Chemring specialises in the manufacture of high technology products for the aerospace, defence and security markets Employing nearly 3,000 people worldwide, and with production facilities in four countries, Chemring has customers in more than fifty countries worldwide Three strategic product segments: Countermeasures, Sensors & Electronics, and Energetic Systems Diverse portfolio of products that deliver high reliability solutions to protect people, platforms, mission and information against constantly changing threats Operating in niche markets and with strong investment in R&D, Chemring has the ability to rapidly react to urgent customer needs VISION: To be the leading developer and producer of technologies to detect and counter radio frequency and network based threats, Improvised Explosive Devices, chemical and biological agents and guided missiles. 3

4 Organisation Chart Chemring Group PLC Operating Business Units Countermeasures Sensors & Electronics Energetic Systems Chemring Countermeasures UK Chemring Technology Solutions (UK) Chemring Defence (UK) Chemring Energetic Devices (USA) Chemring Countermeasures USA (Kilgore Flares) Roke (UK) Chemring Ordnance (USA) Chemring Energetics (UK) Chemring Countermeasures USA (Alloy Surfaces) Chemring Australia Chemring Sensors & Electronic Systems (USA) NIITEK & Chemring Detection Systems Chemring Prime Contracts (UK) Military Pyrotechnics Chemring Nobel (Norway) Energetic Sub-systems 3d-Radar (Norway) 4

5 Countermeasures F-22 flare suite Chemring Group is the global leader in the manufacture of countermeasures which are used to protect aircraft and ships from the threat of heat-seeking and radar-guided missiles and tracking systems. Markets - 50% world market share CH-47 special material decoys Largest supplier of airborne decoy countermeasures to the US Department of Defense and the UK Ministry of Defence Technology leader in spectral, special material and thrusted flares for fixed-wing and rotary-wing aircraft Customers in 33 countries Products - world leading capabilities Air countermeasures RF / IR Naval Countermeasures Conventional and advanced flares protection against heat-seeking and guided missiles Special material decoys covert and pre-emptive infra-red decoys Chaff protection against radar guided threats Naval countermeasures Radio Frequency decoys protect ships against radar-guided threats Infra-Red decoys protect ships from infra-red guided threats Centurion Naval Launcher Centurion naval decoy launcher optimises the placement of naval decoys Maintain world lead in expendable decoys Exploit clear lead in conventional and advanced flares Build market leading position in naval launchers and decoys 5

6 Sensors & Electronics HMDS Markets Leading positions in mission critical niches Over 230 US Husky-Mounted Detection System (HMDS) fielded in theatre Leading US supplier of stand-off chemical detection (Joint Service Lightweight Standoff Chemical Agent Detector - JSLSCAD) and biological agent detection (Joint Biological Point Detection System - JBPDS) UK technical lead in electronic warfare and signals intelligence Resolve EW system Contract R&D capability to UK Government agencies, including cyber security consultancy Advanced solutions and equipment for counter-ied and Explosive Ordnance Disposal (EOD) scenarios Products - world leading capabilities Hand-portable, vehicle-mounted and networked detection systems Security systems - target tracking Man-portable and vehicle-mounted Electronic Warfare systems and electronic surveillance Consultancy, training, solutions and managed services network intelligence, data processing, information assurance and cyber security Remote initiators, recoilless de-armers and lightweight disruptors for counter-ied/eod Exploit world leading technologies IED defeat solutions Maintain lead in GPR and jamming technology Become market leader in IED detection and neutralisation, and chemical/biological threat detection 6

7 Energetic Systems - Energetic Sub-Systems Market - sole source supply to NASA and Martin Baker Leading supplier of low shock satellite separation products and NASA Standard Initiators Largest supplier of pyromechanisms for aircraft egress systems Trusted supplier to key prime contractors including Lockheed-Martin, Boeing, Raytheon, MBDA and ATK Atlas rocket & boosters Products - high quality, high reliability Missile launch and fly - actuators, retention mechanisms, safe and arm units, motors and weapon release cartridges Space and satellite launch - initiators, separation sub-systems, thrusters, actuators, CADs/PADs Ejection seat components and canopy cutting charges to Martin Baker High explosives and rocket motor compositions including HMX, RDX, NTO, NENA products and insensitive munitions Aircrew egress Rocket motor design and manufacture Maintain leading niche positions Exploit trans-atlantic footprint to promote US space qualified products Ensure position on next generation platforms for missile and space programmes Explore non-defence opportunities Satellite separation nuts 7

8 Energetic Systems Military Pyrotechnics Markets - NATO/Non-NATO balance Major supplier to US and UK Strong routes to market in the Middle East Products - specialist rounds and products for niche applications Ammunition 40mm grenades and mortar ammunition for infantry forces Demolition and breaching systems Anti Personnel Obstacle Breaching Systems Sabrex shaped cutting charges Bangalore Torpedo breaching system Pyrotechnic Smokes, signals and illumination rounds Advanced spectral pyrotechnic illumination and screening products Training rounds, launchers and simulators Security products - CS grenades, cartridges and stun grenades Roll-out operational excellence Promote newly developed products Improve asset utilisation by winning major US build-to-print programmes 8

9 Global Footprint 11 facilities located across 4 countries Europe United States of America Chemring Countermeasures USA, Pennsylvannia & Tennessee Chemring Energetic Devices, Illinois & California Chemring Ordnance, Florida Chemring Sensors and Electronic Systems, Virginia & N.Carolina Chemring Countermeasures, UK Chemring Technology Solutions, UK Roke, UK Chemring Defence, UK Chemring Energetics, UK & Norway 3d-Radar, Norway Australia Chemring Australia 9

10 Global Customer Base FY15 revenue split 71:29 between NATO and Non-NATO customers FY million (continuing) Global revenues by segment US DoD is Chemring s single largest customer Chemring has extensive relationships with prime contractors BAE Systems Boeing General Dynamics Raytheon ATK 54% 17% UK 33% 10% Europe (ex UK) Countermeasures 33% Sensors & Electronics 26% Energetic Systems 41% 45% USA 13% 45% 37% 28% 48% 18% 14% Middle East 13% Asia Pacific 24% 29% 16% 55% 16% 9% 75% 1% ROW 69% 13% 18% 10

11 Chemring timeline Revenue /m Countermeasures market growth Energetic Systems acquisitions Sensors & Electronics acquisitions Wallop Defence Systems assets* * Deal announced but completion subject to regulatory approval 11

12 Strategy Maintain world lead in Countermeasures Continuous operational improvement to capitalise on automated facilities Targeted investment in technology to meet emerging air and naval threats Maintain sole-source position on next-generation platforms Complete development of Centurion launcher Build a world leading technology base in Sensors & Electronics Continue to develop technologies for IED, chemical and biological threat detection and evolve land electronic warfare products Win key US and NATO programmes Maintain and grow consultancy and contract R&D business Optimise leading niche positions in Energetic Systems Improve delivery performance to secure position on next-generation programmes Upgrade military and security pyrotechnics product range 12

13 Strategy Improve operational performance Maintain tight control of corporate overhead Rationalise site footprint to match current requirements Better operational delivery by eliminating bottlenecks and improving manufacturing capability Share best practice, within and across segments Manage the portfolio Disposal of European munitions businesses in 2014 Small, targeted bolt-on acquisitions 3d-Radar acquired in 2014 net consideration 1.4m Purchase of countermeasures assets from Wallop Defence Systems announced November 2015, completion expected Q2 FY16 initial consideration 2.5m Target growth markets Invest in new product development for home markets US, UK and Australia Ensure broader access into Middle East and Asia Pacific markets Target growing security and non-defence markets 13

14 Transitioning from short-cycle to long-term programmes Business Segment Sensors & Electronics Vehicle-mounted IED detection HMDS IDIQ R&D HMDS POROR Production IDIQ, upgrades and exports Chemical detection JSLSCAD R&D NGCD Production IDIQ Biological detection JBPDS R&D JBTDS Production IDIQ Electronic Warfare UK MOD On going R&D and International sales Global follow-on orders and new product introduction Countermeasures Eurofighter Typhoon Sole qualified source for flares F-35 Joint Strike Fighter Sole qualified source for new flares Energetic Systems Patriot PAC-3 Missile Sole source for Electronic Safe Arm Fuse (ESAF) Martin-Baker ejector seats Sole qualified source for key energetics 14

15 Future growth programmes: January 2016 status Key strategic wins on long-term US Programs of Record Ground penetrating radar Awarded sole source Engineering and Manufacturing Development ( EMD ) contract to design next generation counter-ied Husky Mounted Detection System Chemical detection Down-selected on all three variants of the Next Generation Chemical Detection ( NGCD ) development programme Biological detection Confirmed as sole source provider for the Joint Biological Tactical Detection System ( JBTDS ) F-35 Joint Strike Fighter Sole qualified supplier of countermeasures for global F-35 fleet Chemring Australia s qualification as second source progressing well 15

16 Our Capabilities 16

17 Countermeasures - Capabilities Air Countermeasures Naval Launcher Advanced Countermeasures Naval Decoys Special Material Decoys 17

18 Countermeasures - Capabilities Air Countermeasures Chemring s comprehensive product range is based on proven threat driven solutions to protect all types of air platforms fast-jets, transport aircraft and helicopters. SH-60 Seahawk Tornado CH-47 Chinook Typhoon Chemring supplies conventional and advanced flares for most NATO platforms F-35 F-22 Our products support the challenges of modern air missions and offer mission specific capabilities including day and night visual covertness and tailored spectral characteristics. C-17 AC-130 F-15 F-18 AC

19 Countermeasures - Capabilities Advanced Countermeasures Chemring s advanced countermeasures are designed to defeat the latest-generation guided missiles, which can discriminate between traditional flares and target aircraft, by emulating flight characteristics and infra-red spectral emissions. Our advanced countermeasures protect both legacy and next generation platforms, including F35 and Typhoon. Typhoon Chemring is the sole supplier for Typhoon flares Thrusted flare K7 thrusted 2 x 1 flare protects F-16 and defeats seeker by maintaining similar flight profile to target aircraft Spectral flare Royal Navy Lynx helicopter deploys cocktail of spectral and MTV flares Chemring is the sole supplier for F-22 and F-35 flares 19

20 Half Year Results FY14 Growth drivers Case study: Next generation aircraft drive market growth Aircraft delivered 1,600 1,400 1,200 1, Global aircraft fleet F 35 Fleet Typhoon Fleet F 35 Chemring sole supplier of F-35 unique flares: - Ultimate global fleet of c.3,000 platforms Typhoon Chemring sole supplier of decoys: - 55mm flare and spectral variant unique to Typhoon - Additional opportunity for BOL chaff & IR - Potential export opportunities remain in Bahrain, UAE, Kuwait, Denmark, Malaysia, and Qatar - Global fleet of c.800 platforms - Build-up of operational stockpiles of 3,000 flares per aircraft, but only for 50% of the actual fleet - Training and test consumption of 150 flares per in-service aircraft per year (10% of war stock) - New flares more expensive than the flares they replace - Decoy user base expands as retiring platforms are sold on to new NATO and growing economies deliveringglobalprotection Source: SIPRI, Global Military Balance, IHS Jane s 20

21 Countermeasures - Capabilities Special Material Decoys Chemring s Special Material Decoys rapidly oxidise in air to generate an Infra-Red signature to protect against advanced heatseeking air-to-air and surface-toair missile threats. Used on multiple platforms including fast-jets, helicopters and transport aircraft. Material is dispensed from conventional cartridges, or a BOL dispenser to provide a preemptive solution to prevent missile lock-on before launch. BOL- Infra-red cassette M211 1 x1 decoy cartridge Chinook CH-47 dispensing flares and Special Material Decoys Infra-red image of BOL IR preemptive decoy 21

22 Countermeasures - Capabilities Naval Decoys Chemring is the world leader in the provision of naval anti-ship missile countermeasures or soft kill expendables for protecting warships. It is the prime supplier of passive radio frequency / infra-red decoys to the Royal Navy, many NATO and other navies throughout the world. Type 45 Destroyer HMS Dauntless fitted with Chemring s Naval decoys Infra-red chaff fired from launchers on board Type 23 Frigate HMS Iron Duke 130mm round firing 22

23 Countermeasures - Capabilities Naval launcher Chemring s CENTURION launcher is a twelve barrelled fully trainable launcher that optimises decoy placement, minimising the need for ship manoeuvre, delivering rapid, accurate and enhanced protection, increasing survivability and sustainment of naval platforms. CENTURION delivers accurate payload placement to maximise decoy effectiveness Fixed Launcher CENTURION can be easily retro-fitted to a broad number of platforms as well as operating autonomously on a range of vessels. CENTURION Trainable Launcher Centurion provides a major improvement in ship borne EW defensive capabilities and can also address surface threats, torpedo threats, and has the potential for longer range offensive capability. CENTURION can be configured with a range of 130mm rounds, as well as being adaptable to other calibres, to suit mission profiles. 23

24 Sensors & Electronics - Capabilities Force Protection Innovation Chem Bio Detection Enterprise Security Electronic Warfare 24

25 Sensors & Electronics - Capabilities Force Protection Chemring is the world leader in IED detection, based on its highly successful HMDS ground penetrating radar system. Chemring also offers a range of robot mounted and handheld products to find buried mines and IEDs, and is a leading developer of advanced jamming technologies to defeat radio-controlled IEDs. SOLO individual protection against Radio Controlled- IEDs R-VISOR autonomous mine detection 3D Radar GPR antenna arrays HMDS vehiclemounted IED detection Disruptors safely neutralise IEDs, protecting assets and forensic evidence SHARD handheld reconfigurable IED detection 25

26 Growth drivers Case Study: HMDS counter-ied systems development and market penetration HMDS HMDS originally funded as urgent operational requirement in Iraq and Afghanistan for US DoD Significant additional sales to coalition forces Canada, Australia, Spain, Italy, Turkey The system is transitioning to baseline capability through customer funded R&D. Potential solution includes Roke developed detection technologies US systems 2017 onwards, plus exports Significant international demand remains 3d-Radar 3d-Radar acquired to provide complementary non-itar solutions Opportunities in Middle East are progressing positively 3d-Radar solutions marketed in adjacent markets. Applications include infrastructure, tunnel detection and industrial survey Hand-held and Robot HMDS technologies utilised in Groundshark hand-held detector Initial orders received, substantial opportunities in pipeline Small remotely operated vehicle-based system also developed Originally a single solution for a single customer, GPR capability has now transitioned to a family of solutions The HMDS is a combat proven, high performance ground penetrating radar (GPR) system providing rapid detection of landmines and other explosive devices (IEDs) Groundshark employs HMDS technologies to provide latest generation hand held solution for land mine and IED detection 26

27 Sensors & Electronics - Capabilities Chem Bio Detection Chemring is a leading provider and systems integrator or advanced point and stand-off chemical threat detection systems and biological agent detectors. Chemring is participating in all three initial R&D contracts for the Next Generation Chemical Detector Program of Record. The ISCAD passive infra-red Chemical detection system is fitted in the Stryker NBCRV JUNO Hand-held chemical detector PGR-1064 Explosives, narcotics, chemical warfare agents, and toxic chemical detection JBPDS Automatic detection and identification of airborne biological agents I-Collector Low cost biological detection and collection 27

28 Sensors & Electronics - Capabilities Electronic Warfare Chemring s EW technology detects, intercepts, locates and disrupts enemy communications on a tactical and strategic level. Chemring also provides solutions to protect friendly forces communication networks. Tactical Electronic Warfare system for radio Direction Finding and interception Strategic signals intelligence geolocation and intercept SAMPSON Advanced processing algorithms for the radar fitted to Type 45 Destroyer HMS Daring GPS jamming protection Locate-T A mobile version of LOCATE to extend range and improve accuracy 28

29 Sensors & Electronics - Capabilities Enterprise Security Chemring provides communications interception, inspection, illegal content tracking and network defence capability. Our solutions provide targeted information to law enforcement agencies for the detection, prevention and prosecution of serious crime and terrorism. We also protect organisations from the threat of cyber attack. SmartToken Making commercial devices suitable for government use A turnkey suite of modular products for lawful intercept Passive content inspection network probe Crypto network design and device management tool Bio-inspired cyber security solution for enterprise networks 29

30 Sensors & Electronics - Capabilities Innovation Chemring is one of the UK s leading suppliers of innovative solutions, product development and contract R&D. Video capture and object tracking Altimeters for UAVs and target drones With more than 400 patents, Chemring continually invests in technology, people and research to rapidly solve complex problems and provide state-of-the-art products that meet the needs of customers worldwide. SmartSwitch Policy management for Smartphones Autoland A UAV Helicopter performs an automatic landing Portable 3G network 30

31 Energetic Sub-Systems - Capabilities Aircrew egress / safety Missile Components Space 31

32 Energetic Sub-Systems - Capabilities Aircrew Egress / Safety Canopy cutting cords to assist in canopy breakup and removal Chemring designs and manufactures a range of safety systems used in emergency situations including crew egress. Scot Communication and Oxygen System Tester (SCOT) These products are supported by our safety testing equipment, including communications and oxygen supply testing. Emergency Egress Handles Exclusive supplier to Martin Baker, the world s leading manufacturer of ejection seats Joint Combined Aircrew Systems Tester (JCAST) 32

33 Energetic Sub-Systems - Capabilities Space Chemring is a leading space component supplier, with a 55 year heritage proven through space programmes. Chemring actuators, thrusters and retractors are used on a number of significant NASA and ESA programmes including the Atlas, Delta and Titan family of launch vehicles, space exploration vehicles and satellites. Over 200 highreliability Chemring products contributed to the successful landing of NASA s Curiosity rover on Mars. In collaboration with the Gioconda consortium, Chemring is supporting the UK MOD s miniaturised satellite research project currently being developed for space research. Large thrusters are used for booster rocket separation, including the Atlas launcher. 33

34 Energetic Sub-Systems - Capabilities Missile components Chemring supplies a wide range of high quality, high reliability, zero maintenance components supporting a number of missile, bomb and torpedo programmes across an international military customer base. Chemring also supplies rocket motors, with a strong track record in fuze and warhead design, manufacture and integration. US Tomahawk long range cruise missile uses a number of Chemring products within its launch sequence 2.75 Rocket PAC-3 Surface to Air missile Weapon Release Cartridges NLAW disposable anti-tank weapon 34

35 Military Pyrotechnics - Capabilities Signalling, screening & illumination Demolition stores Law enforcement and crowd control Mine & obstacle breaching systems 40mm grenades 35

36 Military Pyrotechnics - Capabilities Signalling, screening & illumination Chemring has an extensive portfolio of products that covers illumination, signalling, search and rescue, screening, training, law enforcement and high energy products. Illumination mortars Our screening and obscuring products can be used for rapid and highly effective concealment of troops and equipment in the visual, infrared and laser wavelengths during operations and training. Vehicle launched grenades for screening Screening smokes 36

37 Military Pyrotechnics - Capabilities Law enforcement Chemring manufactures a range of non-lethal security products for military and law enforcement applications. Products include: - CS smoke pellets - Baton rounds - Rubber bursting CS grenades - Vehicle launched grenades - Stun grenades 40mm baton round CS and Stun grenades 37

38 Military Pyrotechnics - Capabilities 40mm grenades Chemring manufactures low and high velocity High Explosive and High Explosive Dual Purpose ammunition. Chemring also produces a new range of 40mm extended range low velocity ammunition for under-slung infantry rifle grenade launchers. Special Forces troops using under-slung rifle 40mm grenade launcher Soldier carrying a bandolier of 40mm High Explosive grenades 38

39 Military Pyrotechnics - Capabilities Mine & obstacle breaching systems Chemring is the leading manufacturer of manportable obstacle breaching systems for quickly clearing safe passageways through anti-personnel minefields, IED threat areas, multistrand wire and other obstacles. APOBS is a self-contained, one-shot, expendable linear demolition charge which can be transported and deployed by a two person team Reusable, inert training versions are also available. APOBS firing and detonating. Advanced Performance Bangalore Torpedo (AP Bangalore) gives significant improvement in performance and is easier to carry and use. 39

40 Military Pyrotechnics - Capabilities Demolition stores Chemring has developed a complete capability in demolition stores to meet the needs of military users for Explosive Ordnance Disposal, field engineering and demolition. Sheet Explosive We provide a full range of explosive products from initiation systems to main charges, both bulk explosive and cutting charges. Sabrex flexible linear cutting charge C4 Mouldable Plastic Explosive 40

41 Our Businesses 41

42 Organisation Chart Chemring Group PLC Operating Business Units Countermeasures Sensors & Electronics Energetic Systems Chemring Countermeasures UK Chemring Technology Solutions (UK) Chemring Defence (UK) Chemring Energetic Devices (USA) Chemring Countermeasures USA (Kilgore Flares) Roke (UK) Chemring Ordnance (USA) Chemring Energetics (UK) Chemring Countermeasures USA (Alloy Surfaces) Chemring Australia Chemring Sensors & Electronic Systems (USA) NIITEK & Chemring Detection Systems Chemring Prime Contracts (UK) Military Pyrotechnics Chemring Nobel (Norway) Energetic Sub-systems 3d-Radar (Norway) 42

43 Countermeasures Typhoon flare Naval decoy deployment Chemring Countermeasures Location: Salisbury, Wiltshire, UK Number of employees: 347 Chemring Countermeasures has world-leading decoy technology for air and naval platforms Main UK supplier of decoy flares and chaff to protect military aircraft from electro optic, infra-red and radio frequency guided missiles and has developed a range of tailored spectral, thrusted and multi-shot flare and chaff products 30 million investment in fully automated production facility, able to provide a significant increase in capacity to meet the high surge requirements during times of conflict Strong position in naval countermeasures Centurion naval launcher developed for perceived UK and world market need for trainable launcher Licensed explosive site complying with all HSE requirements in accordance with UK Legislation - The Explosive Regulations 2014 Constant research and development requirement to maintain technology lead supported by a dedicated R&D team and comprehensive environmental test facilities. The majority of programs are funded by UK MoD combined with some PV programs to support export customer requirements Customers are National Ministries of Defence including the UK, Germany, Italy, Norway, Netherlands, Singapore and Saudi Arabia Centurion launcher 43

44 Countermeasures Chemring Australia F-18 Location: Lara, Victoria, Australia Number of employees: 84 P-3 Orion Chemring Australia manufactures flares and pyrotechnics, and distributes other Group products for the Australian market $36 million investment in a state of the art automated countermeasures facility to manufacture KC-38 and CM-118 flares. Ten-year supply agreement underpinning on-shore manufacturing capability Recently awarded a contract to become a qualified supplier of MJU-66/B flares for the F35 Joint Strike Fighter for US and global market ASCEND military smoke grenade Manufactures a small range of military pyrotechnics and marine pyrotechnics Provides route to Australian market for other Group products Establishing electronic systems development and support capability Principal customer is Australia s Department of Defence Disruptor Marine hand-smoke 44

45 Countermeasures SMD cloud in mixed decoy cocktail Alloy Surfaces HMDS Location: Chester Township, Pennsylvania, USA Number of employees: 213 Infra-red view of BOL-IR M211 Helicopter decoy Alloy Surfaces manufactures Special Material Decoys (SMDs) SMDs eject a cloud of patented pyrophoric metal leaves which heat up on contact with air to create an infra-red (IR) area decoy SMD s and new variants have spectral, kinematic and area decoy characteristics likely to future-proof the technology against most foreseen IR threats BOL-IR deploys cassettes of Special Materials as a pre-emptive IR decoy preventing guided missiles from locking-on to the aircraft before they are launched Alloy Surfaces also offers SMD material as a covert hand thrown infra-red signalling device for soldiers on the ground Customers are US Navy, Marine Corps Army and Air Force, with significant exports to UK and Australia IR illumination device 45

46 Countermeasures Kilgore Flares F-22 Location: Toone, Tennessee, USA Number of employees: 505 F-35 Kilgore Flares is a high volume manufacturer of traditional magnesium flares, with a sole source position on US next generation fighters Products dominated by traditional high volume MTV flares, with growth from advanced flares for new platforms (F-22 and F-35) Manufactures the standard US flares: - M206 - a 1 x1 square flare for helicopters and the C MJU-7 a 2 x 1 rectangular flare for the F-16 - MJU-10 a 2.52 x 1 rectangular flare for the F-15 New products include M212 spectral flare for helicopters Kilgore also manufactures air dropped marine location markers and flares Customers are US Navy, Marine Corps Army and Air Force, with significant exports to UK and Australia Marine location marker deployment 46

47 Sensors & Electronics HMDS Chemring Sensors & Electronic Systems (CSES) Location: Dulles, Virginia, USA and Trondheim, Norway Number of employees: 110 Hand-held 3d-Radar road survey JBPDS Thor III CREW manpack CSES (Dulles & Trondheim) manufactures the Husky Mounted Detection System (HMDS), and now includes 3d-Radar s civil and military products World lead in vehicle-based mine and IED detection based on Ground Penetrating Radar sensor and advanced algorithm technology New hand-held detector Groundshark well positioned for US requirement 3d-Radar acquired in 2014 to add civilian and exportable military products 3d-Radar customer base includes UK and French Ministries Of Defence, as well as commercial road and rail inspection operations Current customers still dominated by the US Army, but exports now include Canada, Australia Spain, Turkey and Italy JSLSCAD 3d-Radar military 47

48 Sensors & Electronics Chemring Sensors & Electronic Systems (CSES) HMDS Location: Charlotte, North Carolina, USA Number of employees: 78 Hand-held Juno CSES (Charlotte) manufactures vehicle mounted and hand-held Chemical and Biological detection systems Chemring Detection Systems acquired in 2011 to add chemical/biological detection to complete the Force Protection detection portfolio Supplies the two main sensors for the US Stryker NBC Reconnaissance Vehicle JBPDS (biological) and JSLSCAD (remote chemical detection) Juno and PGR hand-held products developed for military, security and non-military applications JBPDS Thor III CREW manpack Main customer is US Chem / Bio PEO JSLSCAD 48

49 Sensors & Electronics C-HAWK JBPDS Resolve portable EW Chemring Technology Solutions Location: Romsey, Hampshire, UK Number of employees: 377 Locate SIGINT Chemring Technology Solutions is a recognised leader in contract R&D, and manufactures a number of specialist detection and electronic warfare products Smartlink deployable base-station Roke acquired in 2010 to add a world leading capability in IED detection and jamming, as well as a self funded critical mass in electronics 60% of revenues in contract R&D First proprietary products are Resolve (man-portable EW), Locate (strategic Signals Intelligence) and IED detectors New opportunities include: Smartlink deployable 3-G mobile base station; Smartswitch mobile phone policy-on-the-device; Perception network protection; subsystems for UAVs and a handful of non-defence opportunities Customers are UK Government Agencies (40%), and primes, including Lockheed Martin, L-3 TRL, QinetiQ, Selex and Siemens Smartswitch policy-ondevice 49

50 Energetic Sub-Systems Chemring Energetic Devices (Downers Grove) Atlas rocket & boosters Location: Downers Grove, Illinois, USA Number of employees: 214 (total including Torrance) Aircraft ACES II Egress components Chemring Energetic Devices (Downers Grove) manufactures missile & ammunition components and space thrusters and test equipment Scot acquired in 2008 to bring US footprint for ejection seat and missile components complementing CEUK and adding new space market Manufactures pyrotechnic components for missiles, space launcher and aircrew egress also test equipment for aircrew life-support systems JASSM Lug Retraction Device Customers are USAF, USN, Boeing, and FMS countries for aircraft DCA/PAD egress safety; Raytheon and Lockheed Martin (Lug Retraction) for missile components; NASA, Northrop Grumman and ULA for space thrusters, explosive bolts and pyro-valves JCAST 50

51 Energetic Sub-Systems Chemring Energetic Devices (Torrance) PAC-3 Missile Location: Torrance, California, USA Number of employees: 214 (total including Downers Grove) Safe/arm device Satellite separation nuts Chemring Energetic Devices (Torrance) manufactures space initiators and separation components and Safe / Arm system for the PAC-3 missile Hi-Shear acquired in 2009 to build clear lead in US space market with Scot, as well as adding advanced missile safe / arm technology PAC-3 Electronic Safe/Arm Fuze is the largest single product line High margin business with scope to use Chemring European presence to expand sales into lucrative European satellite market Sole-source for NASA Standard Initiator, and lead supplier of low shock satellite separation devices Customers are Lockheed Martin (PAC-3 and space) Boeing, Harris and ULA Disruptor Explosive Bolts 51

52 Energetic Sub-Systems Ejection Seat Chemring Energetics UK Location: Ardeer, Ayrshire, UK Number of employees: 296 NLAW Shoulderlaunched missile Sabrex cutting charges CEUK manufactures propellants, rocket motors, explosives and pyromechanisms for aircraft, missile and demolitions Nobel acquired in 2005, Leafield in 2006 Strong position in aircrew egress through supply of propellants, cartridges and rocket motors to Martin-Baker Supply of missile components and sub-systems including rocket motors for the UK s Next Generation Light Anti-tank Weapon (NLAW) and 2.75 rockets UK MoD partnering agreement for high explosives and modern demolition stores Detonators, Bangalore Torpedo, Sabrex, and in future sheet and block explosives Metron actuators are a growing non-defence business Metron range of actuators Customers are UK MoD, Martin-Baker, Saab, Thales and BAES 52

53 Energetic Sub-Systems Chemring Nobel Location: Saetre, Norway Number of employees: 98 High Explosive Compositions Chemring Nobel synthesises powdered base explosives for high performance military and civil applications Acquired in 2007 to provide internal supply of HMX and RDX-based compositions Leader in high performance compositions for pressable, cast cure and melt pour explosive manufacture Supplies high-quality materials with controlled powder morphology to optimise performance with insensitivity Customers in the defence market are Nexter, ATK, Aerojet, Nammo, Diehl and Rheinmetall Italy; in the commercial market Schlumberger and Dyno Nobel 53

54 Energetic Systems Military Pyrotechnics Vehicle Launched Grenades Chemring Defence UK Location: Draycott, Derbyshire, UK Number of employees: 197 Conventional & Compact Smoke Chemring manufactures pyrotechnic products, payloads and minebreaching systems for military and security users Mature market with very little product innovation Military products are flares, smokes, trip-flares, signalling cartridges and training products Security products include CS grenades and cartridges and stun grenades Day/night distress signal for both military and non-military users Customers are UK MOD, Europe and Middle Eastern users CS products Day/night distress smoke & flare Disruptor 54

55 Energetic Systems Military Pyrotechnics Chemring Ordnance 40mm grenade APOBS mine-field breaching system Location: Perry, Florida, USA Number of employees: 258 Chemring Ordnance manufactures pyrotechnic training grenade fuzes, 40mm ammunition and a mine-breaching system (APOBS) MEI acquired in 2008 to add US footprint to complement Chemring Defence in signals, illumination & training, and to bring a range of 40mm grenade ammunition and pyrotechnics: also includes Titan Dynamics training products, and Mecar Inc. s trading business Main current product is APOBS 40mm products and M228 practice grenade fuze will recover in future Significant business procuring non-nato ammunition for US government Main customer is the US DoD 40mm product range Disruptor 55

56 Disclaimer 2016 Chemring Group PLC The information in this document is the property of Chemring Group PLC and may not be copied or communicated to a third party or used for any purpose other than that for which it is supplied without the express written consent of Chemring Group PLC. This information is given in good faith based upon the latest information available to Chemring Group PLC, no warranty or representation is given concerning such information (express or implied), nor is any responsibility or liability of any kind accepted, by Chemring Group PLC with respect to the completeness or accuracy of the content of or omissions from this presentation, and the contents of which must not be taken as establishing any contractual or other commitment binding upon Chemring Group PLC or any of its subsidiary or associated companies. Chemring Group PLC is under no obligation to revise, update, modify or amend the information in this document or to otherwise notify a third party recipient if any information, opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate regardless of whether those statements are affected as a result of new information, future events or otherwise. 56