Welcome to the Safran Half Year 2023 Results. At this time, I would like to turn the conference over to your hosts, Olivier Andriès, Safran's CEO, and Pascal Bantegnie, Group CFO. Mr. Andriès, please go ahead. Thank you. Good morning, everyone. I am pleased to welcome you to Safran's H1 2023 Earnings Call. I'm here with Pascal Bantegnie, our CFO. Let us go straight to page four with a summary of our talking points today. Air traffic recovery is continuing. Narrow- body ASK are now trending above 2019 level. The Paris Air Show has been a great success, with a good commercial momentum for Safran, with new orders and strategic agreement. We are posting an excellent financial performance in H1, in profits and cash, mostly driven by civil engines activity. Portfolio management is progressing well with the closing of Faurecia acquisition and divestment of cargo and catering in Q2. We are enthusiastic about the potential acquisition of Collins Aerospace flight control and actuation business announced last Friday. We are pleased to raise our full year 2023 outlook. Particular, civil aftermarket growth is now expected to be up in the mid-to-high 20s, supported by a solid momentum on CFM56 aftermarket. We continue to ensure attractive return for shareholders with the launch of a share buyback program. I'm now on slide five. Narrow-body ASK now exceeds 2019 level in Q2 2023, at an average of 104% of 2019 level. CFM flight cycles also surpass their 2019 level. All geographies trend above 2019 level, with two exceptions, Europe, which includes the lower traffic in Russia and Asia Pacific outside of China. Airlines continue to fly second-generation CFM56-powered aircraft, as demonstrated by the low level of retirements, 94 in H1 2023. Our assumption for air traffic narrow- body ASK is now to be above 2019 level for the full year of 2023. On slide six now, let me share with you some of our main business achievements in 2023 so far. On the left-hand side, in propulsion, total deliveries of LEAP engines stood at 785 units, up 320 units or +69% versus H1 2022. It is also a sequential increase of 14% in Q2 versus Q1 2023. We are on track with our target to deliver 1,700 LEAP in 2023. Civil aftermarket was strongly up at 36.5% for the first six months, with Q2 2023 up 35% year-over-year, after an increase of 38% in Q1. It is worth mentioning that Q2 2023 civil aftermarket revenue exceeded Q2 2019 level, the first since COVID crisis. We have been pleased to announce at Paris Air Show some CFM commercial wins with airlines such as Avolon and Jet2. We also announced earlier in May a significant order from Ryanair. In helicopters, we have signed an MOU with MTU from Germany to create a 50/50 joint venture to develop a new helicopter turbine for the European next-generation military rotorcraft, slated to enter service by 2040. Safran and HAL from India have also decided to form a joint venture to co-design and produce a new generation helicopter engine in India. The first objective is to build the most adequate propulsion solution for the future 13 ton Indian multi-role helicopter and its naval version. In equipment and defense, we announced at Paris Air Show some new contracts. Wisk Aero selected our SkyNaute navigation system for its autonomous air taxi. We also signed the first Patroller export contract with Hellenic Army for four new Patroller tactical drones. In Safran Seats, we have signed a contract for up to 24,000 economy class seat for the 737 MAX aircraft. On slide seven now, I would like to have... strategy. On our CFM RISE Demonstrator program, Safran is coordinating the demonstration of new open fan engine technologies within the frame of the Clean Aviation Joint Undertaking project named OFELIA, which stands for Open Fan for Environmental Low Impact of Aviation. OFELIA Consortium is set to receive EUR 100 million in European funding from Clean Aviation. In electric hybrid propulsion, we signed an agreement with a company named Electra, out of the U.S., to develop a turbo generator for the propulsion of its hybrid electric aircraft, short takeoff and landing aircraft. We signed a partnership agreement with AURA AERO, also from France, for the ERA Electric Regional Aircraft Propulsion. We have announced the installation of automated production lines, specifically for our electric motor engines in Niort, France, and Pitstone in the U.K. This high volume production model, inspired by the automotive sector, will enable up to 1,000 motors to be manufactured per year from 2026 to serve the booming electric and hybrid aviation markets. On slide eight, a quick overview of Safran's financial performance in H1, 2023. Revenue has been growing by 28% year-on-year, with a sequential growth in Q2 of 8%. Recurring operating margin was up 0.6 point, representing a 33% increase in recurring operating income. Free cash flow reached EUR 1.5 billion, driven by customer advance payments on Rafale export contracts. All in all, despite supply chain challenges and continuing inflationary pressure, we were able to benefit from the top line recovery to improve profitability and generate strong cash flows. Pascal, the floor is yours for more detail about our financial performance. Thank you, Olivier. Good morning, everyone. I will be commenting today the adjusted accounts, for which a bridge from consolidated statement is presented in page 10. Same adjustments as before, these are relating to FX or PPA. The number circled in the table, EUR 1.3 billion, reflects the change in mark-to-market of instrument hedging future cash flows, which are recorded in financial income. Mark to market is reducing with a weaker dollar compared to December 31st, 2022. As you know, it's a pure accounting entry, no cash impact, as our derivative instruments will hedge future dollar cash inflows. On the same topic, on slide 11, we continued to add new hedges in H1 2023, taking advantage of an attractive dollars. Net of option being exercised in the period, the hedge book decreased by about $3 billion, covering our exposure for the next four years. In 2023, we confirm a hedge rate of 1.13 compared to 1.15 last year. On average, the euro-dollar spot rate in H1 2023 of 1.08 compare favorably to H1 2022, providing a positive impact on sales. In order to reflect the recent weakening of the dollar, the 2023 revised guidance is now based on a spot rate of 1.10, and it was 1.05 in the initial guidance. I remind you the sensitivity for each cent, it's about EUR 100 million of sales. On page 12, we have a summary of the income statement. Beyond sales and profits, which I will detail in a minute, we had total one-off items of EUR 57 million. We have impaired several programs in aircraft interiors, both in seats and cabin, for a total of EUR 35 million, and booked restructuring costs for EUR 13 million. Part of that is coming from cabin, where we continue to transfer part of the production from the US to Mexico. Financial income is a positive this semester, with returns on cash invested exceeding cost of debt. Our cash resources today are invested in instruments providing 3% to 3.5% return. Tax rate comes at 22.7%, and the net income to the parent is mostly doubling at a bit more than EUR 1 billion, EUR 2.48 per share. On revenue, page 13, adjusted revenue reached EUR 10.9 billion, up 28%, 26% organic, with some acceleration in Q2, driven by the significant ramp-up in OE, especially LEAP deliveries and services across the board. As discussed in a previous slide, a stronger dollar had a positive impact on sales when translated into euros. There is a minimal impact in terms of scope, mostly driven by the acquisition of Orolia back in July 2022. Same chart on recurring EBIT on page 14. Margin improved by 0.6 point to 12.8% of sales. This performance has been driven by an excellent performance in civil engines, LEAP OE, thanks to a high share of spare engines and by CFM56 spare parts. Services in all the other divisions, typically on carbon brakes, which is highly correlated to air traffic, maintenance of aero safety systems or services in seats and cabin. The positive currency impact reflects the EUR 0.02 improvement in edge rate year-over-year. Moving to performance by activities, in the next three slides, starting with aerospace propulsion on slide 15. Revenue was EUR 5.7 billion, up 34% on organic basis. OE revenue was up 56%, with very strong deliveries for LEAP engines. Q2 deliveries were up 14% sequentially, and as Olivier Andriès said, we are on track with our full year targets of 1,700 LEAP engines deliveries, with further increase in production rate in H2 compared to H1 of about 15%. We had a high proportion of spare engines in H1. H2 should be back to a normal mix of installed versus spare engines. Services revenue was up 22% organic, essentially driven by civil aftermarket, up 37% in dollar terms. Let me give you some color on that. Spare parts sales for CFM56 were strongly up, driven by demand, meaning shop visits, price that we raised, back in November last year, and even work scope, was up, I would say, slightly. Shop visits were up in Q2, year-over-year and even sequentially, we are on track with our full year target indication of around 2,000 CFM56 second gen shop visits. Spare parts for high-thrust engines grew at high single-digit rate, and service contracts, both CFM and LEAP grew at a good 2-digit rate, including the contribution of LEAP engines under the RPFH contracts, which, as you know, come with no margin to 2025. On the helicopter engine business, we had a slight positive contribution in revenues with higher HOE deliveries, but aftermarket was impacted by supply chain issues. Overall, the recurring operating margin came up 18.5%, showing a nice 1.2 point margin improvement. Equipment and defense stays at EUR 4.1 billion. It is up nearly 40% organic, driven by a solid growth in services, which are up 25%. Strong recovery across the board, nacelles, carbon brakes, aero systems. In landing gear and aero services, we were impacted by the supply chain difficulties. OE revenue was up by a slight 8% organically, thanks to higher volumes on the 787 in landing gear and our power generation activities, and we also benefited from higher volumes on fuel and fluid systems. Here, again, OE sales were impacted by revised demand and supply chain issues. Electronic and defense contribution in revenue was positive. We had higher deliveries of FADEC, the LEAP electronic control in guidance systems and services in avionics. Recurring operating margin came at 11.4%, slightly down compared to last year. Growth in services was offset by inflation, higher R&D expenses, and supply chain difficulties, notably in landing gear activity and avionics. On aircraft interiors, sales of EUR 1.2 billion, up 34% organic. This is still 41% below the 2019 level, we have not yet recovered in terms of sales. OE was at 25% organic, higher volumes in the floor-to-floor on custom cabin activities. You would see that business class seats deliveries were significantly down in H1 2023 compared, sorry, with shipments expected to resume later in the year once certification is reached on some programs. Services were up 55% organic, both in seats and cabin. The division posted a loss of EUR 100 million in H1 2023, with one of EUR 33 million depreciation of operating assets, mainly an impairment charge for obsolete inventory and losses on two programs facing engineering and certification issues. On cabin, our priority is cost, and we are on track, benefiting from restructuring measures to deliver operating breakeven for the full year. You will note that the divestment of cargo and catering activities from June will have a negative impact on H2 performance. On seats, our priority is execution. Clearly, the performance recovery takes longer than anticipated. Top line is satisfactory, notably in aftermarket, with sales resuming to 2019 levels in June. The underperformance is coming from engineering delays and production cost overruns, and the target to operating breakeven is now pushed to Q4 2023. On slide eighteen, free cash flow was EUR 1.5 billion. Again, this is an excellent performance, driven by a couple of reasons. EBITDA increased more or less in line with EBIT by EUR 300 million. We had, again, a positive impact from working cap. We did receive significant customer advance payments from the Rafale export contracts. Income increased by EUR 400 million, notably thanks to the LEAP RPFH contracts, the helicopter service by the R contracts, and even from the carbon brakes pay-per-landing contracts. This is partially offset by a EUR 1 billion increase in inventories in order to prepare the upcoming ramp-up in production. Cash outflow related to CapEx increased to support growth. H2 free cash flow should come back to a more normal EBIT to free cash flow ratio of 75%, as Rafale prepayments were front-end loaded. On Slide 20, net debt came out at EUR 263 million, with a free cash flow of EUR 1.5 billion. We paid a dividend of EUR 1.35 per share back in June. We completed our share repurchase program related to the 2027 convertible bonds for a total amount of EUR 947 million. We had 1 additional financial investment in non-cash equivalents for EUR 200 million. We continue to enjoy a very strong balance sheet, with a gross cash position of EUR 6.1 billion and almost no leverage. Switching to Slide 20. As I said, we have now completed our liability management transaction, which we announced back in October, to eliminate a 2.2% potential dilution from the 2027 OCEANE convertible bonds. We have repurchased 9.4 million shares for a total of EUR 1.2 billion, and these are held now in treasury shares. By the same logic, we are now launching a share repurchase program of up to 4 million shares, with the aim to fully eliminate the risk of equity dilution of nearly 1% coming from the outstanding 2028 convertible bonds. Market permits, this plan is intended to be executed before year-end. At current share price, this plan represents nearly EUR 600 million of cash outflow. We are also executing the purchase of 2 million shares for the employee profit-sharing scheme, namely the performance and free share grants. Last but not least, we are now launching a EUR 1 billion share buyback program for share consolidation. This plan is to be executed before the end of 2025. At current share price, it represents about 7 million shares. If I add up the three upcoming plans, we intend to buy back around 13 million shares in the next two years for a total of nearly EUR 2 billion. Olivier, back to you. Thank you, Pascal. On the back of a solid performance in H1, we confirm our adjusted revenue target despite a less favorable euro to dollar spot rate assumption, which is now at 1.10 versus 1.05 initially. We raised our EBIT outlook to reflect better dynamic in civil engines. Civil aftermarket revenue now expected up mid-to-high 20%. It is worth mentioning that the CFM catalog list price increase is anticipated earlier this year and elevated. We expect full year 2023 civil aftermarket revenue to get back to 2019 level. We raise our cash outlook to reflect significant customer prepayments. Supply chain remains a watch item, but we feel confident to deliver this raised guidance. Thanks for your attention. Pascal and I are now ready to answer any questions you may have. Thank you. Thank you. If you would like to ask a question, please press star one and one on your telephone and wait for your name to be announced. To withdraw your question, you can press star one and one again. Thank you. We'll now take our first question. Please stand by. First question today comes from the line of Robert Allard from Goldman Sachs. Please go ahead. Good morning, Olivier, Pascal. Good morning, Robert Allard. First question is on traffic and on your assumptions for H2 narrow- body traffic in China, more specifically, when we think about the civil aftermarket guidance. I think we have all seen and heard from you in terms of the updated assumption for ASK to be above 2019 levels this year, but some color on whether you are baking a sequential ASK improvement or not in H2 versus H1 in your civil gap would be helpful. The second question is on LEAP OE, and if you could please provide us with some reference points in terms of the LEAP OE contribution that you have seen in your EBIT bridge in the H1, and possibly tell us a bit about your expectation for the full year. For example, if you expect the segment to be neutral or to be a significant headwind for the full year. Final question, possibly just commentary on M&A outlook from here. I think from the recent M&A call, we got some color on how you think about positioning yourself for the next-gen platform and more strategic autonomy in a more fragmented world. I was wondering, as such, if the CMD guidance was therefore updated, in particular, if I remember well, you had said that the portfolio optimization plan should be globally accretive for group margins over the plan. How should we think about this as well, please? Thank you. Hello, Robert. All what I can say is that 2023 traffic would be overall in full year, same level as 2019. The point is, we have reached that in Q1, and in Q2 we are exceeding, we are at a 104. We expect times 2025 is the date by which we should achieve globally OE breakeven for LEAP. On M&A, does it impact our R&D guidance? The answer is no. Answer is no. The answer is no. As you remember, we are on track to basically revise our portfolio of activities, especially the one coming from the ex-Zodiac activities. Basically, we have achieved to date, about the disposal of about 10% of the ex, Zodiac portfolio, as we talk. Let me maybe give you some color, specifically on 2023. I would like you to keep in mind that we are now consolidating Aubert & Duval, you know, through the equity method, one sort of equity of Aubert & Duval. This is coming as a negative contribution in 2023. We have also divested cargo and catering, which did enjoy, you know, a positive EBIT over time. This is coming again, as a negative control business, is only to be consolidated from 2025. As we've mentioned during the call last week, in 2025, it will be additive to the global, you know, equipment and defense activity. By 2027-2028, we should be at the same level as we enjoy in equipment and defense. Okay. Very clear. Thank you. Thank you. We'll now take our next question. Please stand by. This is from the line of Robert Stallard from Vertical Research. Please go ahead. Thanks so much. Good morning. Morning. Morning, Robert. Couple from me. First of all, Olivier, obviously your competitor is having a few problems with its narrow- body engine at the moment. I was wondering if there are any opportunities for CFM to potentially benefit from these problems? Secondly, on your acquisition of Aubert & Duval that closed in the H1, how much sort of cash investment do you think Safran will have to put into this business over the next few years? Thank you. Hello, Robert. I will not specifically comment on our competitors' issues. Well, this is coming on top of previous one. I can only say that as you remember, our win rate in 2022 was 70% on A320 neos. Our win rate in the H1 of 2023, we are well above that number. We are north of that. We've enjoyed big orders on the A320 neo. I guess there could be a potential, let's say, how could I say that? Orientation of customers towards us. I'm glad to say, I'm proud to say that LEAP is considered the engine of choice today by the airlines and by the market. Now, are we going to have pressure from especially Airbus to deliver more? I don't think there's to deliver more in the months to come. I don't think there's going to be an impact for 2023. If there are going to be an ask from Airbus for 2024 and onwards, I don't know yet. It's too early to say. On Aubert & Duval, the plan, the investment plan for the three, four years to come is about EUR 300 million, that are going to be shared by the three shareholders of Aubert & Duval. If you wish, for us, it's about 1/3 of it, as the investment that is going to be required to reshuffle Aubert & Duval and to increase the capacity. That's very helpful. Thank you. Thank you. We'll now move to the next question. Please stand by. This is from the line of Olivier Brochet from Redburn. Please go ahead. Yes. Good morning, Olivier. Good morning, Pascal. I have a couple of small ones. In interiors, you mentioned two programs where you have impairments. Have the programs been discontinued, or will they come for delivery in the future with effectively no profit? Second question, I would like to come back on Collins situation and I'm trying to understand why the margin was so low in 2019, so pre-COVID, effectively. Trying to understand what explains that, if you could help me with that. Thank you. Good morning, Olivier. On interiors, the programs are not discontinued. We have two customers that we will serve starting from H2, once these programs will be certified. It's clearly a depreciation of operating assets, but we will deliver this equipment starting from H2. Olivier, on the Collins side, I can only reiterate what we said last week. We are confident that we are going to be able to raise the operating margin of this asset in the years to come, through our cost synergies on one side, and also the full exercise of, let's say, the escalation formula that gives us opportunities to escalate price both on the OE side and on the aftermarket side. To me, this leverage has not been fully exercised in the past years. Another element, which has been a key element of negotiation with Collins, as they are going to continue to represent about 25% of our turnover. We have negotiated nice and friendly escalation formula for the asset actuation business above, let's say, what was done in the past. This basically gives us confidence that yes, indeed, as Pascal has mentioned, we can elevate the operating margin of this asset by low to mid-teens, you know, in the years to come. Okay. That is helpful. Thank you very much. Thank you. We'll now take the next question. Please stand by. This is from the line of George Zhao from Bernstein. Please go ahead. Yes. Hi, good morning, everyone. First question on interiors. The last few years, you know, we understood the interiors challenge as being a demand problem, but now demand is coming back, your sales has been recovering, so it doesn't seem like it's a market share issue, yet the losses, you know, have continued to be greater than expected. What is the root cause of all this lack of visibility? You know, what gives you confidence now that you have the sight of path to address the issues and turn around the losses? Second question on civil aftermarket, strong performance. At the same time, you know, we keep hearing about the supply constraints at MRO shops, you know, I understand your spare parts are not subject to the same supply constraints, but what about the concern that, you know, this strong shipment is simply adding to the inventory of spare parts at the MROs? Do you have any visibility into the channel inventory there? Thanks. Hello, George. On interiors, we have two different dynamics on cabin, on one side, and seats on the other side. Keep in mind that we are still 40% below 2019 levels. Basically, just market-wise, this segment of activity is lagging behind propulsion and equipment, just market-wise. As you know, basically, the demand is driven by the appetite of airlines to retrofit cabin. This is really, a decision that they can take or delay. We are minus 40% versus 2019 in turnover. That is something that you need to keep in mind. On the cabin side, the real priority is cost. We are on plan with the transfer of activities from U.S. sites to Mexico. Basically, the low-cost content of our cabin activities is increasing over time. We should be completed by end of this year or beginning of next year with our overall transfer plan on cabin. I expect that we will be breakeven in 2023. Remember, we were breakeven in Q4, 2022 for cabin, I expect we will be breakeven for the full year of 2023, despite the disposal of cargo and catering, that is going to have an impact versus 2022, which basically we evaluate around EUR 15 million, Pascal? That's correct. Of profit that is going to be lost because of a change of scope. This is for cabin. We are on track, on cabin. On seats, we in the last three years, we have completely renewed the product line. We have invested significantly to renew the product line. I can tell you that the this is an attractive product line, as I could witness, I could see at the last Hamburg interior show. There's a very strong appetite from our airline customers for our product line, renewed product line. Our market share on seats, basically is around 35%. We have a very strong market share. There is a very strong commercial dynamic because our customers do like our new product line. That's one element. The other element that we have achieved, and that is completed, is the footprint of optimization on seats. This is behind us now. We have closed sites. We have transferred activities to Mexico on one side from the US, and to Tunisia, from Europe, in Germany, from Germany to Tunisia and Czech Republic. Basically, the footprint rationalization and optimization is behind us now. This is achieved. What is now ahead of us is to fully master the development cost and also ensure that on the development process, we are on cost, on quality, on time. Today, this is still ahead of us. There's a strong focus and strong efforts to now mature and recover the development process. That basically was not very active in the last two to three years, just because it was a pandemic, and so there was no appetite. There have been no orders in 2020 and beginning of 2021. The development activity was basically very low, and now it's booming back again, and we have those other costs. This is basically our challenge ahead of us. The good news is that the aftermarket has come back to the pre-crisis level in June. We believe in H2 2023, this is going to help us because we will have come back to the pre-crisis level. We expect that there's going to be, let's say, a big step up in our operating margin in H2 versus H1. There's a significant dissymmetry of revenues between H1, where the revenues were very low, and H2, especially in business class deliveries. We aim at reaching breakeven in Q4. In Q4, we aim at reaching breakeven in Q4. This is one year lag versus what we had in mind and what we communicated last year. Morning, George. On your second question on civil aftermarket, I would say there is a combination of higher traffic than we expected and a ramp-up in new aircraft deliveries, which is taking place, but maybe at a smaller rate. Meaning that airlines today fly 100% of the LEAP powered aircraft, but also they are put back into service, you know, some parts, CFM second generation, CFM56 second gen powered aircraft, to traffic. It triggers strong demand for aftermarket. There is still capacity in the MRO domain to absorb the more or less 2,000 shop visits we continue to expect this year, and we did not notice that they are adding inventories. They are using the parts in the shops to maintain and repair the engines. We don't see any buildup of inventory to answer your question. Very clear. Thank you. Thank you. We'll now take our next question. Please stand by. This is from the line of, Ian Douglas-Pennant from UBS. Please go ahead. Thanks very much. Yes, Ian, UBS. I have two questions, please. The first, on the free cash flow guidance, the EUR 2.5 billion that you used to have excluded Rafale, and the EUR 2.7 billion now of course, includes some Rafale down payments, at least from the H1. Should we assume, therefore, that the increase in the free cash flow guidance is de minimis, so there's no real underlying change, or is there an underlying improvement as well? The second question is on spare engine sales, at least versus my expectations, OE sales beat my expectations materially, but propulsion margin was also ahead of my expectations. I'm assuming there's a material increase in spare engines proportion within that. Maybe you could provide a comment, and also perhaps any forward commentary on how that might track over the next months and years as well. Thank you. Good morning, yeah, now on free cash flow, our EUR 2.5 billion guidance already included Rafale down payments. By the way, in H1, we had more or less the same amount as we had in H1 2022, coming from two customers, Greece and the United Arab Emirates. The improvement in the free cash flow guidance is not coming from a change in the assumptions regarding Rafale prepayments. I'll take the second question. On the spare engine in H1, there has been a very strong level of spare engine delivery in H1, above normative level, because we wanted to support our airline customers. You know, we have a policy of keep our customers flying. This is a real differential versus our competitor. We keep our airlines flying all the time. There is no disruption, never. We are decided to basically support heavily our customer demand for spare engines in H1. The ratio basically in H1 has been north of 10%. Well above 10%. This does explain basically what Pascal has described. We don't expect that that's going to be the same in H2. Thank you. Thank you. We'll now take the next question. This is from the line of Benjamin Heelan from Bank of America. Please go ahead. Yeah. Morning, Olivier Andriès, Pascal Bantegnie, thank you for taking the question. First one was on equipment. You said at Q1 that you expected OE to be broadly stable, but it looks as though it actually did grow the OE side of the equipment business in Q2. I was just wondering if you could comment on that and how we should think about that for the full year. Secondly following up on that question there, just on LEAP in general, the deliveries did look pretty good in Q2. How are you seeing supply chain in LEAP in general? Thank you. Morning, Ben. Back to my comment in April for Q1. Remember that the OE growth in equipment was more or less flattish, and I did mention two root causes. First one was supply chain issues, and we can confirm that in some parts of our equipment business, we suffer from shortages in some components. We also mentioned revised demand from airframers. Q1 was flat, H1 is up 8%. Compared to what we see in propulsion and aircraft interiors, you would agree this is quite a smaller number. Q2 was up. For the full year, I would not expect such a material increase, so I would say high single digit, maybe 10% growth on OE, but not more than that, except if we were to see some relief in the supply chain, which we do not anticipate today. Okay. Ben, as a complement to what Pascal has just said, be mindful that on the propulsion side, basically, we are exposed to Airbus and Boeing, and so the delivery of OE engines, basically, is driven by Airbus and Boeing demand combined. Whilst on the equipment side, we are mostly driven by Airbus demand, to the exception of 787. That's basically the big difference. On your next question was. Supply chain and LEAP. Supply chain on LEAP, yeah. Well, I mean, we are still navigating through supply chain challenges every day, everywhere, that for sure. The fact is that we manage it quite well on the propulsion side. Yes, I basically am very confident that we will achieve our ramp up on LEAP, and we will deliver as expected by both airframers, Airbus and Boeing, on the propulsion side. The issue is slightly more difficult on some of our equipment, as Pascal has said, especially landing gear, where basically supply chain issues are more acute. And this does also explain, let's say the OE, as well as we have some issues on spares, as well on landing gear today because of supply chain issues. Overall, we are navigating through that. It's our number one focus. We believe it's going to last all of the year and probably extend into next year. Very clear. Thank you, Ben. Yeah. Thank you. We'll now take our next question. Please stand by.... This is from the line of Ross Law from Morgan Stanley. Please go ahead. Morning, everyone. Thanks very much for taking my questions. The first is just on pricing and civil aftermarket. Just wondering how much earlier you are raising prices this year? I think GE might have mentioned August, and what the magnitude of this increase is, whether it's double digit or not. Secondly, on the buyback, on slide 20, you've mentioned the target periods of 2024-2025 for the EUR 1 billion buyback. Does this mean that you need to complete the OCEANE, 2028, and the employee profit sharing scheme prior to starting this? Lastly, on the LEAP, I think CFM programs also use powder metals in some parts. Just wondering, on your confidence around the fact there isn't the same issue with contaminants in LEAP engines, and that an inspection program will be required? Thank you. I will take the first one, and the third one, and we let. Yeah. Pascal respond on the buyback. On the pricing side, yes, together with our partner, GE, we have decided to anticipate our price increase, and yes, I confirm this is going to occur in August. Four months earlier than what we used to do before. The catalog list price increase is going to be high single digit. On, let's say what has been announced by our competitor. I just simply do not know what their issue is, and just I cannot comment specifically on our competitor's issue. What I can say is on CFM side, we detected in summer 2021, a quality issue while inspecting a rotating parts, and we have completed the root cause investigation at the time. This was resulting from a contamination of powder metal at one supplier facility for a limited number of batches. We have taken all corrective actions. We have proactively communicated to our customers via service bulletin. We have planned. We have implemented a staggered removal program in the course of the shop visit cycles. There has been no engine failure, there has been no customer disruption. The financial impact is fully included in our guidance. Morning, Ross. On your buyback question, I will confirm that our intent is to execute the liability management program, which consists of buying back 4 million shares in H2, as well as buying back shares for 2 million shares for the employee profit sharing scheme. It's a total of 6 million shares that we intend to repurchase during the course of the second semester. We will start early 2024, our EUR 1 billion share buyback program for share consolidation. Thank you very much, both. We'll take maybe a last question. Of course. Thank you. Preparing our last question now. This is from the line of Hervé Drouet from CIC. Please go ahead. Yes, good morning, all. Thanks, as well, to take my questions. The first one is regarding the ability you have potentially to get some price increase as well from your suppliers. I mean, you mentioned an increase in tariff, for example, on the propulsion side in August. Do you believe most of the tariff increase on the supplier side, from your side, has been passed, or there are still some to come? Could it be as well after the August period? The second question is regarding your cash flow, which has been pretty good. You have received some good prepayment. I was wondering, do you believe for you there will be some logic to pass some of those prepayment to some people in the supply chain? We have much problematic issues on the cash side to enable to unlock some of the issues, especially on the recruitment for some of them. Thank you. Hello, Hervé. I will take the first one, and Pascal will take the second one. Yes, indeed. We have a strong pricing pressure from our suppliers, especially raw material suppliers, forging suppliers, casting suppliers, but also all along the chain. As you remember, Pascal had mentioned earlier this year that basically the overall impact of inflation was about 3% on our operating margin. 3% gross impact, considering both inflation, energy cost, salary increase, everything. We said that we would pass the main portion of it to our customers through escalation formulas and pricing, not all of it. We have to manage to basically swallow part of it and compensate through performance performance action. Basically, the pass-through is not 100%. We have to swallow part of it. Morning, Hervé. On your second question, as you know, the number one priority for our industry is to do the ramp up, which is in front of us. We are definitely supporting statements in order to invest and start the production, ramp up production, and deliver parts to Safran, but to the whole supply chain. All the tier 1 equipment suppliers are supporting, you know, tier 2, tier 3 suppliers for long. There is no issue that we will keep, you know, cash for ourself. We try to make sure that the supply chain is in order to absorb the ramp up. Maybe given the queue, I see four questions. We'll take one last question, and then that will be it for today. Of course. Thank you. The last question is from the line of Tristan Sanson from BNP Paribas. Please go ahead. Good morning, Olivier, Pascal. Thank you very much for squeezing me in. I appreciate. I had a couple of clarification. I would like to be crystal clear on the situation in business class seats and aircraft interiors overall. If I look at the number of shipment that you did in Q2, about 110 business class seats, that's 76% down year-on-year, at the lowest level we've seen since we are tracking the data. I understand the development difficulties and how it impacted the profitability, but in terms of shipment, is it like an issue of transition in the product range? You can't deliver the new one until the development have been certified, it's just phasing and timing, or is there something more that is weighing on the deliveries that would be really helpful? Second comment is on the A320 equipment shipments, where you're also reporting a decrease in emergency slides and A320 nacelle shipments. How should we read that? Is it just a matter of quarterly volatility, or is there something specific to these equipment activities? Thank you. Hello, Tristan. Well, as you have seen, basically, we have delivered twice as less business class seats in H1 2023 compared to last year. This is mainly a phasing issue, basically mean that we have missed some business class planned deliveries in H1 that are going to slip into H2, mainly for certification delays. Basically, this is driven by, let's say, the development planning and the certification planning. You know, every seat, every new seat that we have to deliver has to be certified. I mean, we have to run a lot of flammability tests as well as head injury criteria tests. Basically, sometimes those tests are failing, and we need to redo the test. That's basically what we are talking about. It's really a phasing related to certification planning, nothing else. On A320 equipment, on the, let's say, slides, there's probably a sort of pent-up demand on slides. This is how I explain it. We have a very strong demand for our aero safety equipment, both from the airframers, as well as the airlines as well. I believe it's a sort of pent-up demand, but this is very dynamic. What is more structural, if you wish, is basically the delivery of nacelle and landing gear, because this is more reflecting what the demand of the airframers are. Yes, indeed, when Pascal said... When he commented on the equipment OE growth in H1 versus last year, basically one of the reason of, let's say, single-digit growth is a revised demand, a revised downwards demand from our airframer customer, especially on nacelle and landing gear. That's very clear. Thank you so much, Olivier. Thank you very much for all your questions, and we wish you a good summer break, and we'll see some of you during the roadshows early September. Bye-bye. Thank you. Have a good bye. Thank you. This does conclude the conference for today. Thank you for participating, and you may now disconnect.