Ladies and gentlemen, good morning and thank you for standing by. Welcome to today's Thales Conference Q1 2021 order intakes and sales. There will be a presentation followed by a question-and-answer session. At which time, if you wish to ask a question, you will need to press star one on your telephone and wait for your name to be announced. I must advise you that this conference is being recorded today, and I would now like to hand the conference over to your speaker today, Mr. Bertrand Delcaire, VP Head of Investor Relations. Please go ahead, sir. Yes. Hello, good morning, and welcome, and thank you for joining us for the presentation of Thales's Q1 2021 order intake and sales. I'm Bertrand Delcaire, the Head of Investor Relations at Thales. With me today is Pascal Bouchiat, our CFO. As usual, the presentation is audio webcast live on our website at thalesgroup.com, where the slides and press release are also available for download. A replay of the call will be available right after the call. With that, I would like to turn over the call to Pascal Bouchiat. Thank you, Bertrand, good morning, everyone. Before moving on to the numbers, as usual, I wanted to highlight a few recent events. I'm now on slide two. First of all, space. As all of you remember, this business faced a couple of difficult years on the back of the softness of the telco markets. In the full-year results presentation, Patrice mentioned the successes we had last year in Earth observation and space explorations. As you will see later in more details, Q1 is confirming these good dynamics in terms of commercial activity. Sales improved strongly, and we expect a positive trend to continue over the rest of 2021 and beyond. The second important point I wanted to stress, as I'm sure you have immediately noticed from our announcement this morning, is that sales were already back to growth in the quarter. In other words, in Q1, we were already able to offset the downturn in civil aero and biometrics, and to a lower extent, the cyclical headwinds in banking cards. Of course, I will come back on this point in greater detail in the next slides. Last topic I wanted to highlight is how we keep investing on the topic of sustainability. The universal registration documents, which we disclosed mid-April, and the integrated reports, which was released this morning ahead of the AGM this afternoon, described our progress and action plans in many areas of sustainability. A powerful move in which I strongly believe was a decision we took earlier this year to include quantitative CSR KPIs in the remunerations of the majority of the teams. This CSR component applies to all employees who benefit from a variable remuneration. More than 54,000 are in more than 2/3 of Thales employees, from ExCom members to managers all across our businesses. This year, it is focused on the achievements and quantitative targets in four priority areas: climate change, gender diversity, frequency rate of accident at work, and anti-corruption training. We have now set the date for the ESG investor event that is announced during our full-year results. It will be held on the 5th of October in the afternoon, most probably in a virtual format. Let's now have a look at Q1 headline numbers. I'm now on slide four. New orders amounted to EUR 3.4 billion, up 28% on a reported basis and even up by 31% on an organic basis. As you will see in a minute, this performance was driven by strong commercial dynamics in defense and in space. Sales came to EUR 3.9 billion, up 1.9% on a market basis and up by 0.5% on a reported basis, i.e., including the negative currency impact. Trends were quite different in our four operating segments. I will explain this in the next few slides. Looking into details at our order intake. I'm now on slide five. As you can see, the strong reported growth of +28% is mostly coming from additional large orders above EUR 100 million. Four in total in Q1 2021 versus only one last year. Two Rafale orders for Greece and France. The new generations of SAMP/T, the Franco-Italian ground-based air defense system. On the civil side, our Indonesian customer, a consortium led by PSN, finalized the financing of SATRIA. This is the HTS satellite designed to provide connectivity to 90,000 schools, 40,000 hospitals and public buildings across Indonesia. On top of these four contracts above EUR 100 million, let me mention that we have also booked the first tranche of the Galileo contract for value that was just below EUR 100 million. It's contributing to the strong order intake performance in the EUR 10 million to EUR 100 million brackets. The remaining part of this project will be booked later during the year for a full value around EUR 750 million in total. Orders below EUR 10 million were of course affected by the pre-COVID comps in civil aero. However, excluding avionics and IFC, they were actually up 4%. Turning now to slide six, looking at sales growth. As mentioned before, it's really great to see that sales were already back to positive organic growth in Q1. As you remember, the impact of COVID-19 was still limited in Q1 2020, around EUR 200 million since disruptions only became really material from mid-March 2020. The biggest drivers behind the positive organic growth were two-fold. First, the recovery of sales in Space on the back of the commercial successes we are recording in 2020, as mentioned earlier. Second, a continuous robust scenario in Defense and Security with double-digit organic growth versus the same period of last year. Turning to the geographical perspective, let me just point out that the decline in emerging market sales was driven by the end of some projects, like in transport, and the consequences of delays at finalizing contracts in the Middle East during 2020. Looking briefly at each segment one by one. On slide seven for Aerospace. Orders were clearly up, as you can see, by 31% organically, thanks to a dynamic start of the year for the Space business. Avionics order were still down as Q1 2020 was almost a normal quarter for this business until mid-March. The decline was lower than in Q3 and in Q4 2020. Sales were only down by 8.7% organically. The drop in aeronautics revenues was still material, a little less than 30%, but it was smaller than previous quarters. Importantly, a large part of this decline was offset by the strong recovery of space, with sales up by an impressive 24%. Turning now to slide eight with Transport. Order intake was up by 66% from EUR 166 million to EUR 259 million, thanks to a catch-up effect on delays at finalizing contracts in 2020, as well as easy comps. Sales were slightly up + 0.5% organically, thanks to growth in our main lines business and despite ongoing travel restrictions still disrupting progress on some projects. Turning now to slide nine, looking at the Defense and Security segment. Higher order intake up by 58% versus Q1 2020 was an illustration of the natural volatility of large contract signatures. Only one was signed in Q1 2020 versus three in Q1 2021. Organic sales growth was also clearly solid, + 12%. Continuing on the very positive trends across most business lines. Among the faster-growing areas in the quarter, I can mention surface warfare, cybersecurity, and also the naval domain on the back of our recent large successes, such as F126 in Germany, which is by the way, the new official name of MKS 180. Type 31 in the U.K., or also the second phase of the MMCM project in France and in the U.K. Turning now to slide 10, looking at our last segment, the DIS, Digital Identity and Security. As mentioned previously, order intake at the DIS is structurally aligned with sales for most businesses as they operate on short cycles. No need for me to comment. At EUR 636 million, sales were down by 7.4% on an organic basis. The decrease was mainly due to high comps in smart cards. As a reminder, we had a peak in smart card sales during H1 2020, which was a bit unexpected and a consequence of the beginning of the pandemic. Biometrics remain depressed with less demand for passports and border control systems. This weakness will, of course, last as long as transcontinental travel is severely restricted. Cybersecurity and IoT showed strong growth, close to double digits. Which brings me to slide 12, which is just a reminder of our financial objectives. All in all, Q1 is in line with our expectations, which naturally leads us to confirm our financial objective for 2021. This concludes my brief presentation. Many thanks for your attention, and I will now be pleased to take your questions. Probably time to open the Q&A session. Thank you, ladies and gentlemen. We will now begin the question and answer session.As a reminder, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. And if you wish to cancel your request, please press the hash key. Once again, please press star one if you wish to ask a question. Our first question this morning comes from the line of George Zhao from Bernstein. Please go ahead. Your line is open. Hi. Good morning, everyone. Just first question. Given all the orders you had in Space from last year, what is a sustainable rate of revenue growth for that business this year and in the medium term? Secondly, on the Aeronautics, you highlighted smaller revenue and order declines. Is that a function of easier comps, or are you seeing better demand from customers as they look for a ramp-up in traffic over the back half of the year? Okay. Good morning, George. First, on Space. Overall, first, I'm quite happy with the profile of our order intake, and it has started on second half of 2020 with various wins that we have commented, in particular in the Copernicus successes and also some successes last year more on explorations, for instance, moon explorations projects. It continued, as you have seen in Q1, on top of this HTS satellite for Indonesia, which has been finally booked in Q1. What I take is more on the Galileo project that was announced a few weeks ago with the first tranche that we booked in Q1 2021. More to come, and I mentioned that in total for 2021, we expect a level of order intake for Galileo that should be around EUR 750 million. All of that is driving revenue growth. Today, probably a good rule of thumb is to consider that high single digit or low double digit top-line growth for Space in 2021 revenues is probably a good guidance for you guys, considering that it should continue the next years to come. I don't want to say that it's going to be at this level for the next few years, but what I can confirm is that in a few years, in probably three, four years, getting a level of revenues that should be around EUR 2.5 billion for this business is really something that is really at reach. Quite positive on this business. The second question was about. Aeronautics growth in the following quarters, or maybe, George, you want to? Yes. If you want to be a bit more clear, George, on the second question, was it about small orders in civil aero? Yeah, like you highlighted, the revenue and order decline was smaller in Q1 than the prior quarters. Yeah. Are you seeing sequentially better demand from customers that say before better capture the back half of the year? It's true that Q4 2020 for civil aero was especially low and probably lower than what we have anticipated. It was not just in Thales. We have seen in all our peers in this industry having reported a Q4 2020, which was pretty low. We are seeing the situation improving little by little in Q1 2021. Overall, what I've mentioned for Q1, - 30% against Q1 of 2020. Sequentially better than the - 40% that we have reported in Q4 2020. What is even more positive is that sequentially we are seeing particular March been better than January and February. We expect this to keep progressing in the next few months now. At which phase, at this point it's clearly a question mark. Sequentially, yes, probably now, in terms of growth rate, at this point, I'm still a bit cautious. Once again, in this industry, what I can share with you is probably what our peers have shared with you in the last few weeks. We are seeing in particular the single body platform at Airbus in terms of level of demand, pretty much in line with our expectation, a bit above 40 aircraft per month in terms of level of demand. We see in terms of aftermarket and institution in March, slightly better than what we have seen in January and February. Expecting this to continue. Of course, all of that being driven by the progressive lift of travel restrictions, which will be, of course, the key driver for the aftermarket to resume in terms of level of demand. Great. Thank you. Thank you. Your next question comes from the line of Olivier Brochet from Credit Suisse. Please go ahead. Your line is open. Thank you. Good morning, Pascal. Good morning, Bertrand. I would have two questions. The first one on comments that you've made earlier this morning around semiconductors. Could you give us a bit of color on the impact in Q1 and what you would expect in Q2, Q3, either indirectly through auto production, for instance, or directly in the production of cards? That's the first question. The second one is on in Australia and the nuclear submarines. Could you update us on the situation of that program and what we should see going forward, please? Good morning, Olivier. First question about shortage of components. First, the positive thing is that in terms of impact for Q1, quite limited. Almost unnoticeable in terms of miss, other miss because of that. As you mentioned, what I can confirm is that at this point, this has an impact on our digital security business, and in particular on the smart cards, which use, of course, a number of chips. Q1, quite a limited impact, even though we have seen these tensions to continue and we expect that this to continue over Q2, Q3, most likely. Once again, driven by this temporary shortage and mismatch between order and demand and supply. Despite the fact that we see all those fundraising and investing a lot massively, I guess you have seen in particular the Taiwanese foundries, having announced massive investments that, of course, a lead time, which means that, we know that the situations will continue to be pretty under tension for the rest of 2021, at least. It's true that we expect a level of impact that should be a bit more material in Q2 for smart card businesses in terms of tension. A bit more than what we have seen in Q1. Last point, what we can do from that's a point that I've already discussed in previous calls. We are Thales, which is quite positive and internal chips design center and capabilities, which makes the qualifications of alternative suppliers probably easier than other players of other industries. What we are striving to do today is really to get qualifications of alternative suppliers in order to ease this supply. To make a long story short, and material effect at this point, probably a bit more in Q2. Overall situation, which is, at this point, really well under control, but we need to remain vigilant and of course, to keep working hard to have alternative suppliers being able to bring more production to Thales needs. Your questions about Australia. It's predominantly Naval Group, of course, a contractor, large size, with the completions of a quite important phase, which is underway today, and Naval Group finalizing this design. A step in the design phase of this submarine, and at this point, negotiating with its customers in the Commonwealth, in the next phase. This should be finalized in the next few months. Moving from this preliminary design phase to a more detailed design phase, which should start probably mid-2021. Now, for Thales' standpoint, as you know, we won the most part of the sonars of the acoustic suites for this program through our U.K. entity. In particular, on what we call the flank arrays, which are by far the largest part of this acoustic suite. Don't expect a significant one-shot order intake. This will spread on a few years. This is quite a significant win for Thales, and in particular, for our U.K. entity. All of that is really positive. Pascal, in terms of revenues for this activity in Australia, should we think of it as starting as well in mid-2021, or has it already started? It's going to be, I would say, not that significant in 2021, and this will grow slightly and progressively in the next few years to come. All of that is really, take it as more as an additional driver for us to deliver on our overall mid-single digit guidance for this defense and security business. This submarine project program in Australia, it's really a project that in terms of design and build, is going to be executed in the next, let's say probably 20 years. Of course, it is positive. It is extremely positive that Thales, and not just Naval Group, but Thales starts this program and works for us in a joint product, which is sonar suite, and in particular, on what we call flank arrays, which are the largest component of sonar suites for a submarine. Okay. Thank you very much. Thank you, Olivier. The next question comes from the line of Ben Heelan from Bank of America. Please go ahead, your line is open. Yes, morning. Thanks for taking my question, guys. I saw some comments this morning, Pascal, that I think you might have made around strategic review of the portfolio. Obviously, I think we all saw the headlines around potentially a disposal of transport. Can you talk a little bit about that? What has driven you to do a strategic review of assets today? Are there any other businesses that are up for review other than just transport? What would be kind of the potential in terms of capital if there are any disposals as a result of a strategic review? Is the aim to kind of reinvest capital and grow, or would you be looking at capital return? I don't really see the balance sheet as particularly stressed. Any kind of color around that would be great. Thank you. Okay. Thank you very much for your questions. What I think is really important to say is that there have been, in the past few weeks, some rumors about the potential disposal of our transport divisions. I was questioned yesterday night by a journalist about those rumors. First, what is absolutely obvious is that it's not the first time that we have heard rumors about the future of our transport business, and we have never commented on any rumors in the past. Of course, I'm not going to start commenting about any rumors on any specific business combination scenarios, acquisition, disposal, JVs, partnerships. When we look at our transport business, we share with you what, in terms of strategy, we have been implementing over the last few years, which was really two-fold. First, a way to improve the quality of our project executions and is driving a progression of our margin. 2020, despite the COVID restrictions, we have reported a level of EBIT margin which was above 5%, significantly above 2019. I mentioned that we were targeting, and I can confirm, of course, today, that we are targeting a level of margin above 8% in the next few years. Also, we have seen pretty good successes in terms of taking advantage of the introduction of digital technologies in this business, and particularly in the win of the Stuttgart digitizations of infrastructure in Q4 2020. By the way, a pilot of what is going to happen in Germany was probably a good illustration of what we are seeking to do. Now, on portfolio management, it is not something new. We run at Thales, by the way, as probably many other large companies, we run a yearly strategic exercise in which, of course, we review each of our business lines and not just a specific one. Each time for each of our business, asking ourselves about how to best position those businesses for our long-term profit driven course. We are driving this yearly strategic exercise as we speak. Once again, it's not something which is new. This is an exercise that we perform on a yearly basis. This doesn't particularly focus on transport. It applies to each of our business. It's really part of what we do at Thales, and it is really our jobs as managers. In this strategic exercise, of course, we ask ourselves if M&A opportunities of any kind, of any nature, whether it's partnership, whether it's JVs, whether it's acquisition, disposal, if this can generate more value for our shareholders. This is basically where do we stand. I don't want to make any more specific comment on this point. Of course, your question about capital use, no speculation at all, Ben, on this matter. Okay, great. That's a very clear answer. Thank you. Thank you. Next question. The next question comes from the line of Celine Fornaro from UBS. Please go ahead, your line is open. Yes. Good morning, Pascal. Good morning, Bertrand. Thanks for taking my questions. I've got a couple of questions. The first one would be regarding the progress that you are doing, or you could comment on in aviation regarding your cost base. Because yes certainly, maybe there is some sequential improvement in Q1, but the situation seems to be more painful for longer on the wide bodies, which is some of your exposure there. If you could give us an update on potentially the profitability of that business over time and how you're progressing there. The second one would be looking at the order intake of Q1, some potential good momentum on Q2. How should we think about cash flow for this year? How has it been going for the first few months of the year? Thank you. Good morning, Celine. First On our aeronautics business in terms of cost base. As you know, we have put in place in 2020, a cost-cutting programs in various countries. In particular in U.S., in Singapore, and also in France. Singapore and U.S. were almost done end of 2020 with a progressing implementation of this program in France. You probably have in mind that when we presented our 2020 figures, we mentioned our structural cost targets for 2021 versus 2019 with overall direct cost that should be something around -37% down versus 2019. Pretty much the same on G&A. A drop in R&D and in sales and marketing that will be more limited, of course, as we need to prepare in the future. We are right in line with that. It also means that we are going to keep booking also restructuring in H1 2021, and in particular, on our IFE business, which as you know is with a significant exposure on wide body with an industry industrial base in the U.S. It was anticipated end of 2020 that with a restructuring charge that will be booked in H1 2021, to go even further in our cost base reductions in U.S., in particular in our IFE business, where the level exposure to wide body is larger than it is in our cockpit avionic business. On your second question was on cash flow. Cash flow, first, I can reiterate what I share with you for 2021. Overall, underlying conversion ratio should be around 95%. I have also mentioned that the continuations of reversals of down payments in our large defense export project. I remember that I mentioned about EUR 200 million of headwinds coming from the reversal of down payments on Rafale and driving us to a level of cash flow for the full year that should be around EUR 1 billion. Of course, it's true that any additional well-funded export contract will help in delivering figures and why not deliver even a bit better. At this point, it's probably a bit too early. Q1 in terms of cash flow was pretty good relative to our traditional sequence of cash flow. As you know, Celine, we consume cash in H1 and we generate cash in second half of the year. It's your typical profile of cash flow at Thales. What I can share with you in the first three months, our cash flow profile was better than it was a year ago. Pretty positive in term of cash flow profile, which reflects our continuous focus on this matter. It's quite obvious. Overall positive, really giving us confidence on the guidance that we shared with you a few months ago for the full year 2021. Excellent. Thank you, Pascal. The next question comes from the line of Andrew Humphrey from Morgan Stanley. Please go ahead. Your line is open. Hello. Good morning, thank you. A couple of questions from me, please. I wanted to follow up first of all on transport. Looking strategically at that business, you've just been through a period of two years of fairly lackluster sales growth. Clearly, budgets at metro operators are pressured at the moment, given the low numbers of people who have been taking transport in numbers of markets over the last year or so. How confident would you be that the trading performance of that business reflects its potential long-term value? Would be my kind of follow-up question on that. The second question relates to aerospace. We've obviously seen a sequential improvement in Q1 versus Q4 and Q3. I wanted to ask you how sustainable you see that trend as in IFE and avionics. Also, talk about how, if I could ask a kind of related question to that, how OE and aftermarket businesses within aerospace been during the quarter? Mm-hmm. Okay. Good morning, Andrew. First, on transport. First, it's true that the last two years on transport in terms of top line was quite soft, following a period of exceptional growth from 2015 to 2017, 2018. Under that, in particular, of quite large-size project in various countries with a more pause. That doesn't change this long-term view of transport in terms of potential for growth. By the way, it's not just Thales assessment. It's the type of figure that this industry is showing. Overall, it's a business that where market demand is more around a low single digit to a mid-single digit, depending upon the various segments. Now from the COVID, what we're seeing in some kind of decoupling between the main lines, where we keep seeing quite a level of demand in various countries. Behind that it's with the green transport and the willingness of many states, many countries to invest more in their overall main line infrastructure. Quite an obvious example is Germany, also U.K., for instance, are example of countries where they want to invest more on main lines. Urban is a bit more difficult, this is where we need to see how will the COVID in the mediums affect the level of demand for urban, away transportations. When we look at our business in main line is much larger than urban. Second point on aerospace. Overall, last week I made a comment on particular at Airbus and our delivery to Airbus, which was our delivery to Airbus was about for the A320 was a bit above 40 aircraft. It was, in my recollection, more on average 42 aircraft per month in the first three months of 2021. In terms of sequence, where we see probably as compared to what we have seen in Q4 2020 in particular, is probably sequentially an improvement, even though at this point still a bit modest. In terms of after-market for the civil business, sequentially better throughout Q1, March being better than February in particular. This is where we're expecting in the next three months to show still a progressive improvement in terms of demand. Once again, very much driven by the restorations of traffic, in particular transcontinental traffic. We know it will take time, of course. Sequentially, we expect Q2 to be probably better than Q1. Even though, I guess you get from items that remain, of course, cautious because all of that is also dependent upon how quickly will we see travel restrictions being lifted. Okay. Thank you. Congratulations on the quarter. Thank you, Andrew. The next question comes from the line of Tristan Sanson from BNP Paribas. Please go ahead. Your line is open. Yes, good morning, everyone. It's Tristan Sanson from BNP Paribas. Good morning, Pascal and Bertrand. Three quick points from my side. First question, can you comment on the progress towards finalizing the Telesat order this year and how the funding package of the project is progressing? Second question is on the situation in the Middle East on civilian military markets, where the performance was difficult on both orders and sales in Q1. Can you give us a bit of granularity of what's going on there? Which countries are down? Which are the countries that are still supportive? Do you see any sign of possible recovery there if we leave aside at this stage the Rafale order from Egypt as a one-off? Third question will be on the IoT business, actually more broadly on the cyclical activities that are recovering or showing an inflection in Q1. You commented on civil aftermarkets doing better sequentially. Is it correct to understand that IoT is also re-accelerating? If there are any smaller businesses that is also showing a positive inflection, I would be interested in knowing. Thanks. Okay. Good morning, Tristan. On Telesat, of course, these questions should be probably best addressed by our client, by Telesat. This is a very large-size project. In total level of CapEx, that should be around EUR 5 billion, of which, I mean, for Thales Alenia Space, I'm seeing around EUR 3 billion. This is quite a large-size project. It's because of that, it's quite obvious, I mean, that putting together a funding package, of course, it takes a bit of time. It was anticipated. It was absolutely anticipated, it is, in my view, I mean, moving on in line with our own expectations. Now, we have seen Telesat making significant progress. They have announced a few days ago the fact that raised $500 million U.S. dollars by way of a new bond offering. They have announced a funding agreement, this time with the government of Quebec. What I think will be quite important for Telesat in order to put together its overall funding package as probably quite an important point of their equity injections will be the cash that they should get from the C-band repurposing in the U.S. and in Canada, where my understanding is that Telesat is expecting quite a significant amount of cash from this C-band repurposing matter. It is progressing. When will it be completed? At this point, it's probably a bit too early for me to share with you what should be the timeline for this funding package to be finalized. Once again, it's probably a question that should be best addressed by Telesat. As you know, Tristan, of course, we are not waiting for this funding package to be completed to start working on this project. We sign with Telesat an ATP, Authorization to Proceed, which allow us to progressively ramp up in term of resources. Of course, it's not as if this project would be in force and thus being able to work on a full speed basis. At least, we take advantage of this period of time to start working and to ramp up resources, in particular, critical resources, in order to avoid wasting time. Your point about Middle East, first, maybe in term of revenues and sequence of revenue. As you know, we are in 2021 finalizing or completing the executions of two large-size project, one being in Doha, the other one being in Dubai. That's something that you need to have in mind. Now, in terms of level of demands, I'm putting aside, as you suggested, the Egyptian Rafale orders. We managed to book quite a large-size defense project in one large country in the Middle East. Unfortunately, I cannot be more precise at this point, but which was quite positive, and this being in the air defense matter, and which should pave the way for future development in these areas. In terms of level of demands across those various countries, there's nothing specific country by country that I can report to you. We see a lot of demands from those various countries. I mean, for us, UAE, Saudi Arabia, Qatar are quite important countries for us. I cannot highlight any specific level of demands of matter that should be unique to any of those countries. What we see is a lot of demands. Now it's more about finalizing decisions and contract awards in those countries, where we have seen that it takes probably a bit more time than it was in the past. Sorry, just to be clear, in your mind, there's no change in the level of fundamental demand in the Middle East, it's just delays in finalizing contracts right now? Yes. Absolutely. All right. I can tell you that the level of demand, the level of request for proposal is quite strong. On businesses where we have seen a drop in demand in 2020 because of the COVID impact. You have mentioned IoT in particular for the automotive market. It's true, and I highlighted this point in my presentation, that we have seen in Q1 a level of demand in IoT, which has increased quite significantly against last year, which is a positive move. In particular from the automotive, but also from the payments markets. This is really, even though it's not that large-size business for Thales, but it's a positive move that I need to report. Where we see still quite a sluggish at this point level of demand is more in our biometrics, and passport and production, which is still suffering from a low demand. Here, for me, the key drivers will be as we will see, travels resuming, which will drive, of course, higher demands in biometrics for border control programs. Also in terms of secure documents demand, in particular passport demands, which have been quite depressed. We know that there will be a rebound, but at this point, it's not that much what we see today. Being a bit patient before seeing a rebound of the secure documents and biometric level of demand. That was very helpful. Thank you, Pascal. Thank you. The last question comes from the line of Christophe Menard from Deutsche Bank. Please go ahead. Your line is open. Yes. Thank you very much for taking my questions. I had three. The first one is coming back on the chip shortage. You mentioned DIS. I wanted to understand whether there were any impact on the other divisions, because quite obviously you're using chips in defense, space, and avionics. Whether that is something we should be looking at in the next quarters. The second question was on defense and security. You had a very strong Q1 in terms of sales growth. If looking historically, it's probably the second strongest quarter since Q1 2016. Wanted to understand how we should be looking at the rest of the year in defense and security. Q2 should be good because you were at -15% in Q2 last year. Should we be looking at a very strong year in terms of organic growth in defense and security, or some kind of slowdown by the end of the year? The last question is a bit linked to this, is on your guidance that you're confirming, and the sales guidance. Considering the very strong performance in Q1, should we be more looking at a narrow range in terms of sales growth? It seems that the low end of the guidance range in terms of sales is easily achievable in the light of what we've seen in Q1. Mm-hmm. Okay. Good morning, Christophe. On your first question about chip shortage, no, the impact is very much focused on the DIS, particularly on smart cards. At this point, no specific concern on all the businesses. It's really a question of first level of volumes, which have nothing to do. When we talk about smart cards, we are talking about billions of chips. When we talk about the other businesses, we are not talking about thousands. It has nothing to do in terms of level of demand. Second point, smart card is a short cycle type of business, very low level of inventories. For the defense and the other businesses at Thales, it's more long-term project with, of course, a level of inventories, which have nothing to do. At this point, no specific concern on chip shortage in our other businesses. Second, on defense and security. Yes, it's true that Q1 was strong. As you all know, we might also have some kind of cutoff from a quarter to the other. Don't draw a conclusion for the full year on the basis just on our Q1 figures. Of course, it's positive, giving us a good confidence on the full year for this business as well. I'm not changing my view about what we share with you for our defense and security business for the full year, which is, in my recollections, Bertrand was around the mid-single digits, something like that, in terms of top-line growth for our defense and security business. Which in my view, as we speak, is our best assessments and which is pretty good. Coming to your third question. Yes, it's true, we made it clear as we released our 2021 guidance, our revenues. A range which was quite large, but also reflecting a number of uncertainties. At this point, probably a bit too early to provide you with a narrower range. That's something that of course, we will consider as we release our H1 figures end of July with probably, hopefully, a better view on, in particular, on travel restrictions and how we will see aftermarkets in particular. In those civil businesses where we suffered quite a lot in 2020 in terms of drop in demands, I mentioned biometric as well. Probably in July, we'll have a better view in term of resumptions of demands and probably a good timing for you to update you on a more narrow range in term of sales guidance for the full year. This is how I see the situations today. Okay. Thank you very much. Thank you very much, Christophe. I understood it was the last questions. Yes, okay. If there is no further questions, maybe in concluding this call by stressing that Q1, yes, is very much in line with our expectations. Of course, we remain focused on the delivery of our financial objectives and the execution of our strategy. You have probably noticed that this afternoon we are holding our AGM. Sadly, the Paris Air Show will not happen this year, and sadly, it is as it is. I will participate in several virtual events over the coming months. Of course, please don't hesitate to reach out, Bertrand or Olivier, if you have further questions. Thank you very much for your attention. Have a good day. Bye-bye. Thank you, ladies and gentlemen. If you didn't have a chance to ask your question on today's call, please do not hesitate to send your question to Thales Group Investor Relations at ir@thalesgroup.com, and we will get back to you as soon as possible. Thank you all for your participation, and you may now all disconnect.