Welcome to the Safran Half Year 2021 Results. At this time, I would like to turn the conference over to your host, Olivier Andriès, Safran CEO, and Bernard Delpit, Deputy CEO and Group CFO. Mr. Andriès, please go ahead. Good evening, everyone, and thank you for joining us to this call to present our H1 2021 results. I will start the presentation with a glimpse of air traffic data in H1 on slide five. I will give an overview of financial and business highlights for the last six months. During H1, the increase in air traffic has been gradual and irregular. We already discussed the trough in February, a quarter ago. What we have seen since March is an ongoing gradual increase with a halt in May due to the upsurge of COVID cases in Asia. Weekly cycles for CFM engines, both CFM56 and LEAP, have returned to their 2019 level in China. In the rest of Asia-Pacific, cycles are still going down, reaching - 71% compared to 2019 mid-July for both CFM56 and LEAP. In North America, the level of cycles compared to 2019 has been quite stable in early July after a steady improvement. It is now around -15% compared to 2019 for all CFM engines. In Europe, the improvement in flight cycles is more recent but seems rapid, with a level of -34% versus 2019 reached mid-July for CFM engines, out of which CFM56 were at -39%. All in all, weekly cycles as of July 18th, to be compared to the same week one year ago, for all CFM engines were down 29.5% versus 2019, and CFM56 were at -35%. What we observe now with a more contagious variant spreading around the world makes us cautious, yet still confident about the rest of the year. Looking at financial on slide six, adjusted revenue reached EUR 6.676 billion. It was down by 21.6% with a strong negative exchange rate headwind. On an organic basis, it went down by 17.3%. Adjusted recurring operating income was EUR 659 million, down 30.4%, representing 9.6% of sales. It is down 29.3% on an organic basis compared to H1 2020, but improving by 140 basic points compared to H2 2020 underlying margin. Operations generated EUR 701 million of free cash flow, a 22.2% decrease. This represents 106% conversion to our recurring operating income, and it allowed to decrease our net debt position. All in all, our first half has been challenging in terms of top line, but thanks to a very high level of cost efficiency, profitability is increasing compared to H2 2020, where recurring operating income represented 8.2% of revenue after taking into account the effect of the activity transformation agreement in 2020. On the cash side, a good cash generation has allowed us to reduce the net debt in H1. On slide seven, a focus on propulsion. Combined shipments for CFM56 and LEAP engines reached 448 units, down 16% compared to H1 2020. That means 211 LEAP delivered in Q2 compared to 188 in Q1 this year and 178 in Q2 2020. At the end of June, total LEAP backlogs stood at more than 9,300 engines, and our market share on A320neo family is close to 60%. For CFM56, the progressive ramp-down continued as planned. 49 engines were shipped in H1, out of which 23 in Q2. Mid-June, GE Aviation and Safran launched a bold development program, the CFM RISE, targeting for more than 20% lower fuel consumption compared to current LEAP engine. We also extended CFM International partnership agreement by 2050. On aftermarket. Given what we have observed in Q1, it is not a surprise that Civil Aftermarket revenue was down 25.5% in H1 compared to H1 2020, even with a year-on-year growth of +55% in Q2. Remember that Q2 2020 is a very low comparison basis. Spare parts sales in H1 are still down year-on-year, especially CFM spares, and services contracts slightly decreased. In our helicopter business, the Arrano 1A engine that powers the Airbus Helicopters H160 is now certified in both Europe and U.S. On slide eight, a few words on our Equipment, Defense, and Aerosystems division and our Aircraft Interiors division. First, Equipment, Defense, and Aerosystems. Safran has been chosen by Singapore Airlines to provide wheels and carbon brakes for its entire fleet of Boeing 777-9 through a tailored brake landing service contract. 31 aircraft are currently on order. Safran currently supports wheels and carbon brakes for 126 Airbus and Boeing aircraft at Singapore Airlines and Scoot, the low-cost airline of the Singapore Airlines group, including A320, A350, 737-800NGs, 737 MAX 8, and 787. Safran signed a 12-year nacelle life service contract with Corsair for the nacelles of its five Airbus A330neo. With this contract, the group commits to the repair of the nacelles and the general service of the thrust reverser at the time of their program removals with the support of its network of experts for on-site nacelle inspection and its maintenance, repair, and overhaul centers. Safran has launched Geonyx M, a new inertial unit for fast boats and amphibious vehicle. It complements the Geonyx line range, as well as the Argonyx and Black-Onyx ranges intended respectively for surface vessels and submarines. Coming to our Aircraft Interiors division, Safran regains customer interest in its products and achieved several commercial successes in H1, in particular with the German airlines for the crew rest areas and the Skylounge Core business class seats of its future fleet of 16 A330neo aircraft. A Middle East airline to provide new VUE business class seats for its Boeing 737 MAX, and an Indian airline to provide Z110i economy class seats for 75 A320 and A321. Slide nine. Efforts that were engaged last year are going on. Restructuring actions have been taken in order to enhance the competitiveness of Safran. We still have manufacturing footprint optimization actions ongoing as we talk. HR costs in H1 are down year-on-year, but more important is when we compare HR costs in H1 2021 to HR costs in H1 2019, we are still at the same level of savings that what has been achieved in full year 2020. It is a result of two different effects in opposite directions. On the one hand, we benefit from a lower head count that is still decreasing yet at a slower pace. On the other hand, as foreseen, we have a lower use of short-time working scheme. It is around half the level we saw in the last nine months of 2020. We are continuing our industrial footprint optimization. As an example, no later than two weeks ago, one new site closure has been announced. Safran Electrical Components site in Santa Rosa, California, which is within Safran Electrical & Power. All in all, with regards to costs, we navigate the crisis with a very cautious approach and put the same pressure on costs as last year. Research and development expenses are down 5% compared to H1 2020 and almost flat compared to H2 2020. OpEx in H1 2021 are down 13% versus H1 2020, and they are 28% below H1 2019 level, despite an increase compared to H2 2020 due to HR costs and lower use of short-term working, as just explained. CapEx commitments are kept under control, and the impact of CapEx on cash is decreasing year-on-year. I will give the floor to Bernard for the financials of the first half of 2021. Thank you, Olivier. Good evening to everyone. Slide 12, just as a reminder, you know that the average spot rate was $1.21 against euro this year. It was $1.10 last year, it creates a negative impact on revenues. Hedge rate is at $1.16, as we said at the beginning of the year, no change against last year. We had some mark-to-market impact of the spot rate at close in our accounts, you know that we will state that in the adjusted data. On slide 13, some update on our FX strategy. The hedge book totaled EUR 29 billion at the beginning of this month. The euro dollar peaked at $1.23 on January. The trend reversed, based on news flow from central banks leading to a stronger dollar, with the euro dollar reaching a low point at $1.17 at the end of March. We took this opportunity first, to spread the risk of tail by moving away the nearest barriers. 83% of these scale barriers are above $125, and we also took the opportunity of this FX landscape to add new options to the 2024 book at strikes consistent with our long-term rate targets between $114 and $116. For 2021, we are very comfortable with achieving a hedge rate of $116 for the full year. I suggest we skip slide 14, which is the usual bridge between consolidated data and adjusted data that I will comment. Let's move to page 15. One-off items were negative for EUR 195 million. It reflects impairment for one equity accounted investment and several programs. We also booked EUR 31 million of restructuring costs. Net financial income was EUR 84 million -, compared with EUR 117 in H1 2020. It reflects the higher cost of debt, with EUR 51 million cost of debt in H1 this year, including the cost of two major transactions for bonds and converts in H1. It also reflects foreign exchange losses of EUR 28 million this year. Income tax charge was EUR 100 million, representing an apparent tax rate of 26.2%. Adjusted net income group share was EUR 269 million. EPS was EUR 0.63, a decrease of 47%. On slide 16, on revenue. Adjusted revenue reached EUR 6.876 billion in H1, down 21%, and we're still at 57% on H1 2019. Two comments here. Currency reflects the weakening dollar, Q2 sales for all divisions are now above Q1 level. Of course, Q2 comparison basis is much easier than Q1, the 10% increase in Q2 is a good start of the recovery. Again, comparison basis were low. It's not featured in this slide, I think it's worth mentioning that the 10% organic growth in Q2, the breakdown is 14% on propulsion, 9% in equipment, but still down 4% in interiors. On slide 17, recurring operating income went down from EUR 947 million in H1 2020 to EUR 659 million at the end of June, it's down 30%. On an organic basis, recurring operating income went down 29%. We have experienced strong negative volume impact on all activities, especially civil after market, which is obviously detrimental to recurring operating income recovery. On the other hand, cost savings have been achieved on R&D and personal expenses on external services. Obviously, some elements cannot remain as low as in 2020. For instance, short-time working, as Olivier said, will not bring the same savings in 2021 compared to 2020, and some external services that have been frozen in 2020 have to rebound. All in all, we have managed to bring operating expenses in H1 down compared to H1 2020, and still down again 28% compared to H1 2019 level. I think that's one of the main achievements of the first half of 2021. The group recurring operating margin stood at 9.6% of sales, which remains below H1 2020, but improved compared to H2 2020 underlying margin that was 8.2%. Slide 18 on R&D. Total R&D spent was EUR 640 million, of which EUR 426 for self-funded R&D. R&D sold to customers, which includes works funded by agencies mostly in France, is increasing by EUR 64 million compared to H1 2020, mainly driven by higher funding and works coming from the French Aerospace Plan. Self-funded R&D expenses decreased by EUR 21 million, notably due to lower development expenses on civil and regional aircraft programs. Given the back end weighing profile expected in terms of activity and profitability, we have very carefully managed R&D expenses, which decreased by 35% compared to H1 2019 and in line with savings achieved in 2020. As a result, R&D impact in P&L decreased at 4.7% of sales. On slide 19, the overview of business performance. All three divisions' recurring operating income have been impacted by negative volume impact, a negative effect of under absorption of fixed cost, but a positive impact coming from lower expenses. This is what I'm going to explain on the next slide, starting with propulsion on slide 20. Revenue was EUR 3.249 billion down 20% or down 15% on an organic basis. OE revenue was down 15.6% in the first half due to lower LEAP engine deliveries and CFM56 continues rundown. We delivered 399 LEAP engines, that is 11% less than in H1 2020. We delivered 49 CFM56, that is 42% less than in H1 2020. Services revenue in propulsion were down 22%, driven by civil aftermarket revenue and military services. Civil aftermarket was down 25.5%. Remind you that it was down 53% in Q1, so it's a 55% increase in Q2. We've seen some sequential improvement from Q1 to Q2, up 15% in 2021. The drop of 25% year- to- date was mainly due to lower spare parts for CFM56 engine and to a lesser extent for high thrust engines. Services contracts slightly decreased as well. Two activities have been resilient in propulsion, helicopter turbine activities with a double-digit organic growth thanks to services, and OE military sales, thanks to higher M88 deliveries for the Rafale program as planned. Recurring operating income decreased at EUR 504 million with an operating margin at 15.5%, close to full year 2020 operating margin. Despite cost savings, the operating margin is strongly impacted by the drop in civil aftermarket and to a lesser extent, by military support activities. Helicopter turbines have been a very good, strong, positive contribution in H1 2021. For the record, we did not book any loss at completion for long-term CFM56 services contracts. For equipment on slide 21. Sales totaled EUR 2.972 billion, down 18% or 14% on an organic basis. OE revenue was down 20% or 15% on an organic basis and up 6% in Q2. Services were down 14.5% in H1 or 10% organic, but up 18% organic in Q2, notably with carbon brakes and engine support activities in nacelles. Despite defense support growth, electronics and defense activities decreased in H1, mainly driven by avionics, sighting, guidance systems, and optronic activities. Profitability decreased at EUR 270 million and represents 9.1% of sales, and this decrease was mainly driven by the drop in volume. The one-off items were EUR 59 million were booked, mainly due to impairment of three programs. Now, aircraft interiors. Sales totaled EUR 646 million. It is down 40% or 35% organic. Aircraft Interior is again the division that has most suffered from the crisis. We believe it has reached a trough in Q1. OE revenue was down 37.6%, or 32% organic in the semester, including a 5% decrease again in Q2. Sales were strongly impacted in cabin due to lower volumes for galleys and lavatories, and for floor-to-floor activities and catering and inserts. In seats due to lower volumes, as business class seats were down by almost 60% in H1 2021. Services revenue in Aircraft Interior was down 45% or 42% organic, and again 5% in Q2, driven by seat aftermarket, as well as cabin spare sales and MRO activities. The recurring operating income decreased again and was negative for EUR 110 million. Operating margin was strongly deteriorated at 17% -. Thanks to cost savings, recurring operating income decrease remained limited considering the size of the sales decrease. Operating income reduced by EUR 10 million this semester, when sales are down more than EUR 400 million. It demonstrates the depth of the restructuring achieved in this business that paves the way for strong rebound as soon as demand comes back. Some words on free cash flow. Free cash flow reached EUR 700 million, despite a 24% decrease in EBITDA. Free cash flow generation was driven by cash from operation of EUR 733 million. Tight control maintained on investments at EUR 329 million, down from EUR 421 million in H1 2020. Working capital improved by almost EUR 300 million this semester, essentially driven by a strong decrease in receivables and a good control of inventories. Some words on liquidity. I'm sure you've noticed that we have been in the market to issue bonds in March and to restructure a convertible in June, on top of a EUR 500 million bank loan signed with the EIB at the beginning of this year. In a nutshell, Safran liquidity is strong and sound, and I guess that page 25 says almost the same thing with a net debt of the last 12 months EBITDA at 1.2x at the end of June. Net debt has been reduced and nothing really to say on the balance sheet at the end of June. Olivier, over to you. Thank you, Bernard. Turning to slide 29 to conclude this presentation. The evolution of air traffic at a global level is consistent with what we are foreseeing at the beginning of this year. We have been cautious in considering that reaching our full-year targets implies a meaningful ramp-up in the second half, that remains to be done. We see reasons to be both confident and cautious. On the one hand, vaccination rollout all around the world has been impressive. On the other hand, the spread of variants is still a threat to the growth in sales and profitability that is expected for H2. A delay in the pace of civil aftermarket recovery during the second half of the year constitutes an element of risk to this outlook. We are confident in our capacity to go on managing cost reduction and manufacturing footprint optimization. Our full year 2021 outlook is confirmed for sales and profitability. It is raised for free cash flow. Taking into account Rafale export contract advance payments, we now expect an increase in free cash flow generation above 2020 levels. Ladies and gentlemen, we are now at your disposal for the Q&A session. Ladies and gentlemen, if you wish to ask a question, please dial zero and one on your telephone keypad. We have our first question from Robert Stallard from Vertical [audio distortion]. Thanks so much, and good afternoon. I have two questions, please. The first one is, you noted that there, Bernard, that there had been an improvement in the aftermarket in the second quarter sequentially. I was wondering if you'd seen any signs of airlines pulling forward some of their aftermarket demand from the second half in preparation for the summer. Secondly, I was wondering if you could give us an update on how your deliveries to Boeing are going on the 737 MAX, and whether you're still below their current production rate of 16 per month. Thank you. Hello, Robert. Yes, indeed, as Bernard said, the aftermarket in Q2 improved versus Q1 by 15%. I would not say we see airlines pulling forward. We don't. Spare parts purchase, we've not seen that yet. On deliveries to Boeing for the MAX, Boeing has indeed increased their monthly rate of production. Remember that we had delivered quite a number of LEAP engines to Boeing in the course of 2020 in advance of their needs. There's still a significant number of LEAP engines that are out there in Seattle ready to be mounted on aircraft. What we deliver to Boeing on a monthly basis is not connected, is not directly related to their production rate because of what we delivered to them in 2020. So do you have any- Overall- Oh, sorry. Overall, we said at the beginning of this year that the number of LEAP engines that we would deliver in 2021 would be in the same range as last year. This is what we said. I can say today that it's going to be up north of 800. It's going to be a step up versus 2020. Small step up. More LEAP-1A engines delivered to Airbus, less LEAP-1B delivered to Boeing, once again, because of the advanced deliveries we've made in 2020. That's great. That's very helpful. Thank you. We have another question from Céline Fornaro from UBS. Please go ahead. Yes, good evening. Thank you for taking my questions. My first question would be regarding on the spare parts performance in the propulsion division. I know in Q1, the weakness, you explained it, due to the catalog issues that you had in Q4, so clearly there was a pull forward there at the end of last year. What are you seeing in Q2? Also, presumably now you start to have a feel of what could happen in Q3. Does that relate to the more cautious statement that you're making on aftermarket for the remainder of the year? That would be my first question. My second question would be related to interiors and the overall outlook on profitability for this year, given the heavy losses on the first half and potentially a limited pickup in business, given the wide-body exposure for the second half. Thank you. Okay. Céline. Spare parts. Yes, we have explained the pull forward as one of the reason why there was a slight decrease in revenue per shop visit in Q1 2021 compared to 2020. We said as well that there was also, let's say, some airlines pushing fan and turbine part of the work scope pushing forward. When I look in Q2, revenue per shop visit, we are in the same vein as Q1. Basically, the trend that we have seen in Q1 has remained in Q2. We see a step up of spare parts sale in Q3 in relation to the pickup of the air traffic that we are forecasting. Basically what we're seeing, remember, we were at -40% of narrow body ASK in June. End of July, we are at -30%. We are seeing a step up. Normally that should materialize in spare part revenues soon in Q3. Interiors profitability, as Bernard has said, there has been a tremendous action plan to reduce the breakeven point, both on seats and cabin. The fact is that H1 has been a trough in the top line, and I can say it's been an achievement to be where we are, considering the top line that has significantly fallen in H1 versus H1 2020. Now, going forward on seats, we expect a better H2 than H1 with, let's say, more activity and a better top line. Same for cabin. We still target a breakeven at the very end of the year. Now maybe, Bernard, you can complement. It means that you just cannot take the first half as a run rate of losses for second half. We think we're going to halve it. That's, I think, the best guidance I can give for H2 losses for interiors. You get it? Thank you. Céline? Yeah. Just to mention, you're going to maintain the loss for H1 over the full year, yes? Of course. It's going to be loss-making in Q3, and we hope we can break even somewhere in the last quarter. On a full year basis, it's going to be above what you've seen at the end of June. Don't take H1 and double it to get the full year figure. Of course, you will see the material improvement at the end of the year. Thank you very much. Very clear. We have another question from George Zhao from Bernstein. Please go ahead. Hi. Good evening, everyone. In the first question, we've seen pretty strong traffic recovery in U.S., China, Europe. As you've noted, the other regions still remain quite weak. Could you quantify for us the proportion of your narrow body engine fleet before COVID that was outside of those three stronger regions? Given that we're now more than halfway through the year and total narrow body ASK is still trending below your conservative case, what type of contribution do we need from those other regions to get to your traffic and aftermarket guidance for the year? Second question, a quick one on equipment. Can you just elaborate on which product areas have been leading the aftermarket recovery and how that compares versus propulsion when you look at similar aircraft class? Narrow body engine versus narrow body equipment. Any color there? Thanks. Okay. Hello, Zhao. On the respective weights of the various regions for our, let's say, CFM business and cycles, trying to give you some guidance. Europe weighs for around 30%. Europe including Russia and CIS, close to 30%. North America is above 20%, 22%, 23%. That's about it. China is around 15% and APAC as well. APAC, Asia Pacific is around 15%. To give you some keys, okay? On the equipment, I will let Bernard respond. Okay. I understand the question, George, is about where is the pickup in Q2 coming from in the various businesses that we have inside the equipment division. Is that it? Yes, exactly. Whether it's wheels and brakes versus some of the other ones. Any color you would share would be great. Fair enough. Q2 for the equipment division was 4% up on total revenue, but it's up 9% on an organic basis. The main part is coming from our nacelle business that has seen a strong recovery in aftermarket in Q2. Our landing system business in Q2 was also quite strong, and I would also say that the Aero systems division has also done quite a good job. Electrical and Power and our electronics and defense business in Q2 were a bit more flattish. It's not down. This is how I can detail the pickup in revenue in the equipment division. Again, I would say that most of the improvement came from services on an organic basis. The equipment in services were up 18%. I would say that all divisions, excluding Electrical and Power, were up in services for equipment in Q2. Got it. Any comparisons to the propulsion side when you take a similar narrow body versus narrow body? We have to work on that. We will try to elaborate the answer later, George. Okay. Thank you. We have another question from Ben Heelan from Bank of America. Please go ahead. Yes. Morning, evening, rather. Thanks guys for taking my question. My main question is on visibility in Q3. I think we heard from GE earlier in the week that they were expecting a 25% improvement in shop visits sequentially in Q3 versus Q2. Could you give us a bit of color about how you're seeing shop visit visibility and how that kind of plays into your aftermarket expectations into the second half of the year? The second question, I think you obviously highlighted in the presentation, you've done a lot of restructuring of debt maturities and the balance sheet in a pretty good position. Can you talk a little bit about capital allocation and how you guys are thinking about capital allocation as we're starting to hit the recovery? Thank you. Okay, I will take the last one, Ben. I don't think it's the right time to talk about capital allocation at that time. We will have a capital markets day at the end of the year. I think that will be the right timing and place to talk about capital allocation. Please keep your question for later on. Olivier, you take the one, or I can answer on GE. Basically, Ben, what we've said at the beginning of this year, and we confirm that the total volume of shop visit for 2021 should increase compared to 2020 by mid-teen. This is our number. At the end of H1, we are below the volume of shop visit that we had reached in H1 2020. Just simple math because of the strong Q1 2020. We are below. Now, we see a step up in Q3 versus Q2. In Q2, we had around 15% more shop visits versus Q1 2021. There has been one step. We see a further step in Q3, that it's maybe too early to quantify, and we will see a further step in Q4 in order to get to the overall volume I mentioned. Ben, just one comment, because the read across between GE and Safran is always very difficult because we don't have the same fleet. I think that when we make comments on shop visits, we look at shop visits for the second generation of CFM56 engine, as we think these are the ones that really matter in terms of value. I guess as our partner in GE, they are looking at all shop visits, not only second gen for CFM56, not talking of non-CFM engine. Yeah. Okay. No, that's fair. Thank you. Next question from Jeremy Bragg from Redburn. Go ahead. Evening, guys. Thanks for taking my question. Evening. Evening. First question, please. Given that we're tracking a little bit below the trend line on narrow body ASKs, are you still comfortable with your guidance of getting back to 2019's level of shop visits by 2023, please? The second question is on my favorite topic, which is revenue per shop visit and USM. Could you just give us a feel, please, of the amount of USM that is in the system at the moment, and whether you still think that you can keep revenue per shop visit flat, despite maybe more USM coming into the system through pricing increases? Is there a risk that if you put prices up, you drive customers to use more USM? Thank you. Okay. Jeremy, I will take those questions and maybe Olivier will make some comments after. In terms of long term or midterm trends, I must say that it's not an easy question. We will refresh our assumption at the Capital Market Day to see when exactly it's going to be 2023, 2024. We don't know yet. Maybe it's a question of quarters moving, because as you said, that ASK is lagging behind what we had in mind the beginning of the year in terms of trend. We will update that. I think it's too soon. It's really something complex because we have to take into account re-timing, retirement, the amount of deliveries that air carriers will put on the market. There are so many moving pieces here. I think it's too early to update you on that. I would say also the same thing on the revenue per shop visit. As we said, we are a bit below 2020 in terms of revenue per shop visit. Some part of the explanation, I think, has to do with the work scope that is not exactly the one that we had forecasted before. I have absolutely no mean to give you an answer on the amount of USM in the pipe for the moment. The only thing I can say is that the total retired CFM56 engine is still very low. I think that the level, the amount of USM is still a question mark for us for the future. The basics of our answer saying that you cannot take any retired aircraft and take the parts out to maintain a new aircraft, this is still valid. The amount of retired engine will not give you exactly the same, the exact question of how much of that will be taken to maintain new generation engines. That's, again, a bit tricky, and we are working on that to refresh our assumptions for the Capital Market Day. Okay. Thank you. May I ask one more? Jeremy, what we can say short term, because there has been a low number of retirements in 2020 and the early part of 2021, we won't see a surge in new starts in the short term future, in the coming months. We won't see that in the coming months. We will update you, as Bernard said, for the capital markets. Lovely. Thank you. Please may I ask one follow-on one, which would be around Airbus production rate increases, because I think at the last quarter when we spoke, they hadn't been announced, and now they have. Would it be possible to give a view on that, whether you feel that 70 or 75 is the right number, if it's possible for you to go there easily, et cetera, please? Thanks for the question. Sorry. We are listening carefully to all our customers, airline customers, leasing company customers as well. I have to say, we are not sure that the market has the appetite for such rates, and that rates well above 60 can be sustainable. This being said, we've agreed on the number of engines that we will deliver to Airbus in 2021 and 2022, we are discussing with them the numbers for 2023. Lovely. Thank you so much. We have another question from Tristan Sanson from Exane BNP Paribas. Please go ahead. Yes. Good afternoon, everyone. It's Tristan from Exane. First, thank you so much for bringing forward the release to today, this evening. It's much appreciated. Much simpler for us. I have a few technical questions to ask, so I apologize for that. Three ones. The first one is on the employee profit-sharing agreement. I remember that in H2 last year, you released a provision by EUR 103 million, which was actually some kind of excess provisioning for employee profit-sharing in H1 that you adjusted in H2. If I remember correctly, the employee profit-sharing agreement is a two-year agreement that benefits also this year. Can you give us an order of magnitude of what is the kind of impact we have in H1? Is it similar to the provision that you released in H2 last year? Is it linear or not at all? To get a feel for what will reverse once things normalize in 2022. That's the first question. The second, I apologize if you already explained this, but can you come back on the repayable advances in propulsion impacting the recurring operating income in H1? What does it refer to, and is it significant in numbers? The third one is a clarification on the free cash flow outlook. I just wonder whether your free cash flow trajectory for this year is better than expected if you exclude the Rafale orders from Greece and Egypt. Is it showing some improvement compared to your initial vision or not? Many thanks. I will start with the last one, Tristan. Excluding the Rafale prepayments recent announcements, it's going as planned. It's okay. No major issues. I was already comfortable with the initial guidance, and I am even more comfortable today with the announcement of some new prepayments for Rafale. The repayable advance in propulsion, you know how it works. We get some funding for some specific programs, and if the programs are not successful, we don't have to repay that. When you book that, it's a positive, it's a one-off. It was material in the propulsion business, as we have other exceptional negatives, I would say that the net exceptional in the propulsion was something like EUR 60 million at the end of H1. Taking that into account, also other negative exceptionals. EUR 60 million net positive? Net positive, yeah. Okay. Thanks. Yeah. Yeah. Thanks. For the employee profit-sharing agreement, I don't know exactly what you mean. The savings that we made, if I may say so, in 2020, were based on the kind of targets that we had before the crisis. This is the kind of savings that we made, and that was also compared to 2019, where we made a lot of provisions based on what were the results by that time. I'm sure that the reversal would be not as high as the savings, as the improvement in profitability will be gradual. Don't take the savings and take that as a headwind for the same amount when it will be reversed in 2022. Okay. Well, I guess we'll get some clarity on that at the capital market day as part of the total net savings. That's a useful comment. Thank you, Bernard. We have another question from Chris Hallam from Goldman Sachs. Please go ahead. Thank you for taking my question. First, just to come back on the point you made, that you aren't sure whether rate 60 is sustainable. I just wonder, is that a 737 + A320 comment, i.e., is that 120 months? I suppose it's quite plausible that we end up in a sort of 70/50 production split between the two manufacturers. Put another way, what 737 rate are you assuming to be uncertain on rate 60 from Airbus? Separately on free cash flow, previously you'd expected a balanced H1 H2 split, which probably meant around EUR 550 million per half, you've obviously done much better than that in the first half. Now we have a prepayment in the second half on the military side of probably around EUR 150. Should we be expecting around EUR 700 million in the second half, or with some of the H1 performance we saw a pull forward from the second half? Thanks. We'll start with this one, Chris. Thank you for the question. No, don't take just the math as you do that. Don't take the 700 as run rate for the rest of the year, because part of the strong H1 was due to some actions that we were planning to do on the H2. No, it's not going to be as high as the figure that you just mentioned. Okay. And on- Please. Yeah. Sorry. Yeah? Yeah, go ahead. Sorry. Yeah. Chris, on rates. First I would like to outline that Boeing has been significantly successful in the first half of 2021 in gaining additional orders. They've got more than 500 additional orders for the MAX. The good news is that the MAX has regained customer confidence and Boeing has secured big orders from Southwest, United, Alaska, Ryanair, and I guess there are more to come. You should not bet on a significant imbalance in market share between both airframes. That would be medium term mistake. Okay, that's helpful. Thank you. We have another question from Christophe Menard from Deutsche Bank. Please go ahead. Yes, good evening. Thank you for taking my questions. I had three quick ones. Going back to GE and what they said. They said I understand that it applies to all their shop visits, so my question was more on the 2nd generation. They said green time impacted them in Q2, but they expect less of a green time impact in Q3 and Q4. Does that comment also applies to CFM56 2nd gen, according to what you see at the moment? Second question is on FX and the efforts you made on what you highlighted in terms of the barriers. Would it be fair to say that you could target in 2022 and 2023 the low end of the range in terms of FX rates? Is it still undecided, I would say? Last question on the equipment division and aftermarket. Did you see a high level of Initial Provisioning or airlines actually rushing to provision some spares or equipment in the aircraft equipment division specifically in Q2? Christophe, I will take the first and the third one, I will let Bernard answer on the exchange rate. On green time, what we have seen in H1 2021 is in the same vein as what we've seen since the start of the pandemic. Same vein as H2 2020. We expect Q3, Q4 to be kind of the same as first half of 2021. We may be wrong, but this is what we expect. On equipment, no we don't. We've not seen big IP orders from airlines for our equipment business. We've not seen that. Okay. For FX, I will keep the range. It's too early to tell you exactly where we will end in the range. Clearly today, the spot rate is $118, so if you stay with this kind of rate for a long period of time, at the end, as I always say, hedge rate and spot rate have to converge. If the spot rate stays at the same level, you cannot expect to decrease the hedge rate from what $116, which is the situation today, to lower levels. Okay. Thank you very much for the answers. We have another question from Harry Breach from Stifel. Please go ahead. Yes. Thank you. Thank you very much for taking my question. Good evening, Olivier. Good evening, Bernard. Guys, just three quick ones. Firstly, Olivier, please forgive me. At the beginning of the call, you kindly gave some year-on-year comparisons for the number of cycles, I think from the CFM56 fleet for the recent week. Could you please just repeat those data points, those figures you gave? Secondly, guys, we've talked a lot about spare parts and aftermarket. Just wondering, if we think about the spare engine side of the business, is that still very slow at trough levels? Are we starting to see any pickup on that side? Finally, just turning to supply chain, how are you seeing supply chain performance sort of overall at the moment? Is it about the same in terms of sort of level of concern, improving, or maybe going the other way? Thank you. Maybe I can start with the supply chain and to explain again how we manage the situation. We have a watchtower when we look carefully at 700, which is a small portion of our supply chain, but we carefully watch 700, and we think that there are, let's say, a bit more than 100, less than 150, which are in a situation that need really to be managed. For the moment, we haven't seen a lot of suppliers really turning into a very bad shape. Very handful, I would say, have experienced critical situation. We don't see that as a burning issue, even if we start to work very intensively with them to prepare for the ramp-up in the second half. We made across-the-board inquiries to be sure that they are ready, that they have all means from a cash point of view, from a headcount point of view, to ramp up again. I would say that today, I don't have that on my agenda as a bottleneck for the ramp up in the near term. If I can answer on spare engines, I would say the situation has not much changed. We haven't seen a lot of new orders. I would expect it to be stable in 2021 versus 2020. You can't expect airlines to purchase a lot of spare engines in the situation today. Stability is the message here. Yeah. We've sold the same number of spare engine in H1 2021 than in H1 2020. Cycles. In June 2021, I mentioned that the narrow-body ASK, so average seat kilometers were at around 60% versus 2019. Basically a - 40%. That was in June. Now we are end of July. In end of July, we are at - 30% versus 2019. This is year-on-year, same week that we compare. Okay? This is varying depending on the regions. Very irregular. China, we've come back to the 2019 level in terms of cycles. In Asia Pacific, we are at - 70%. I said - 71%. That's - 70%, roughly. In North America, we are at - 15%, and in Europe we are at - 34%. This is now in end of July. This is where we are. This gives us an overall - 30%. We think for all CFM engines, the LEAP engines are flying more because there are more LEAP engines flying now than there used to be in 2019, so they are flying more. The CFM56 engines were at -45%. Does it clarify? Yes, that's really helpful. Thank you, Olivier. Thank you, Bernard. We have another question from Andrew Humphrey from Morgan Stanley. Go ahead. Hi, good evening, and thanks. I've got a couple, if I may. One shorter term one. I'm wanting to ask about some of the exceptional costs that you highlight in the first half of 2021, particularly the EUR 180 million charge. Is that basically the same or equivalent to what your joint venture partner called out on one particular loss-making contract? Can you shed any further light on that, what type of aircraft that is? A couple of longer term questions. Firstly, in terms of as you look at your fleet at the moment, I understand third shop visits are not a big part of the economic drivers, but do you have an expectation for how many engines in your current fleet will come in for their third shop visit? Finally, maybe an even longer-term question following up on the presentation around the RISE demonstrator program. Do you anticipate a significant package of improvements that could be applied to the LEAP or sort of intermediate stage or upgrades that could come to market before that 2035 timeframe? That's okay for me. We'll start with the first one with exceptional cost. Do you refer to the EUR 195 million - one-off items that we booked in H1? If it's related to that, it's really the depreciation of an intangible R&D asset for our space business. Most of that. Okay. There is nothing like loss for contracts, nothing like that. Okay. Just depreciation. Understood. Okay. On the long-term question, shop visit number three, third shop visit. I have to say that we've not made the breakdown between shop visit one, two, and three in our numbers. They are very few shop visit number three. Our fleet is quite young. We are talking mainly shop visit one and two, as we speak. I don't have any flavor to give you on shop visit number three. Anyway, shop visit number three is much less significant for us in terms of revenues. If any, that would be because of 1st generation of the CFM56 engines, so very limited impact. Yes. No, I'm not sure I understood your question on the RISE and LEAP improvements. Can you please repeat and clarify? Yeah, of course. Apologies if it was a bit unclear. I guess what I am driving at here is you have clearly targeted a very significant improvement in efficiency with the RISE program, as well as a significant departure in engine architecture from what we have today. Yes. I guess what I'm asking is how much scope there is for a sort of intermediate stage, not between the two architectures, but a material improvement to the LEAP engine in terms of efficiency that could come at an earlier date. Okay. I see. Thank you. Okay. As you said, RISE is targeted at 2035. This is a 2035 horizon. I would like to outline that we are not talking about the launch of an engine development. We are talking about a technology development and technology maturation program. Within RISE, there's a significant layer of underlying technologies, plus this disruptive architecture. The underlying technologies that we are working on could apply to any kind of engines, whatever the architecture is, including the LEAP engine. We would use this layer of underlying technologies. I talk about composite, we would go more composite for the forward part of the engine. We would go additive manufacturing. We would improve here and there. Those underlying technologies could apply to a LEAP improvement program for an intermediate timing horizon. It could apply to any kind of new engine. Is this clear? Does it clarify? Yeah. I will not quantify. No, that's very helpful. Thank you. Okay. Thank you, Andrew. We are done. Thank you. Good evening. Bye-bye. We have no further question. Gentlemen and ladies and gentlemen, this concludes today's conference. Thank you for your participation. You may now disconnect.