Devonport site visit summary presentation 13 th March 2019 Marine - - PowerPoint PPT Presentation

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Devonport site visit summary presentation 13 th March 2019 Marine - - PowerPoint PPT Presentation

Devonport site visit summary presentation 13 th March 2019 Marine Land Aviation Nuclear www.babcockinternational.com Disclaimer This document has been prepared by Babcock International Group PLC (the Company) solely for use at a


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Marine Land Aviation Nuclear

Devonport site visit – summary presentation

13th March 2019

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Marine Land Aviation Nuclear

Disclaimer

This document has been prepared by Babcock International Group PLC (the “Company”) solely for use at a presentation in connection with the Company's analyst and investor site visit on 13 March 2019. For the purposes of this notice, the presentation that follows (the “Presentation”) shall mean and include the slides that follow, the oral presentation of the slides by the Company, hard copies of this document and any materials distributed at, or in connection with, that presentation. The Presentation does not constitute or form part of and should not be construed as, an offer to sell or issue, or the solicitation of an offer to buy

  • r acquire, securities of the Company in any jurisdiction or an inducement to enter into investment activity. No part of this Presentation, nor the

fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. Statements in this Presentation, including those regarding the possible or assumed future or other performance of the Company or its industry or

  • ther trend projections, as well as statements about Babcock’s or management’s beliefs or expectations, may constitute forward-looking
  • statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are

beyond Babcock’s control. These risks, uncertainties and factors may cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements. Accordingly, no assurance is given that such forward-looking statements will prove to have been correct. Forward looking statements in the Presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. They speak only as at the date of this Presentation and the Company undertakes no obligation to update these forward-looking statements. The information and opinions contained in this Presentation do not purport to be comprehensive, are provided as at the date of the Presentation and are subject to change without notice. The Company is not under any obligation to update or keep current the information contained herein. 2

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Marine Land Aviation Nuclear

Marine: how we operate

3 › All UK submarine refits and life-extension › 75% surface ship refits › Submarine and ship fleet time support › Design, build, assembly and support of QEC › Future class support and systems upgrades › 100% Canadian submarine refits › Australian ship and submarine support › Weapons technology to South Korea, Spain › US-UK submarine missile tube programme › New Zealand and Oman dockyards › Owned intellectual property in complex energy, marine and defence systems › Through-life support of complex assets › Platform integrator of OEM technology › Design and use of support technology

UK Naval International Naval Technology

Surface ships Equipment Submarines Training Surface ships Equipment Submarines Training Engineering consultancy Equipment Energy and Marine Systems

Advanced technology Technical expertise Unique infrastructure All supported by:

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Marine: how we do it

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› Design, integrate and support technology (both ours and OEMs’) › Upgrade platforms & predict critical support › Deliver savings and advance the definition

  • f availability

› Long heritage of innovative engineering knowledge and applied technology › Deliver critical programmes for complex assets in highly regulated environments › Owned and managed unique infrastructure › UK and International infrastructure › Supports naval and commercial marine programmes

Advanced technology Technical expertise Unique infrastructure

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Marine Land Aviation Nuclear

Marine: where we operate

5 Canada UK New Zealand South Korea Spain Bahrain Oman Australia

Clyde Rosyth Devonport Bristol

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Technology focused business

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› Owned intellectual property – complex systems / equipment design and development – ecoSMRT, weapons handling and launch systems (WHLS) › Through-life support of complex equipment – Weapons and C4ISR › Design, engineering and management services – platform integrator of OEM technology › Use of innovative support technologies – enabling digital asset management (iSupport)

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Unique combination of technical expertise and infrastructure

Ship-lift Large-scale docking facilities Astute Class jetty Vanguard Class refit facility Frigate support centre 7

Owned Managed

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Solving complex problems for our customers

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Upgrade legacy platforms and systems Upgrade critical and complex national infrastructure Deliver critical and highly complex programmes Reduce through life support costs Enhance platform and system availability (at lower cost)

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Marine Land Aviation Nuclear

What we do at Devonport

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Marine Land Aviation Nuclear

Devonport: introduction

› Largest naval dockyard in Europe › Dockyard owned by Babcock (Naval Base operated by Babcock) › UK centre of excellence for deep maintenance of Royal Navy complex platforms › Provide critical marine and nuclear engineering services, integral to our customers’ operations › Strategic support partner to the UK Ministry of Defence (MOD) › Involvement in a range of complex naval programmes › Strong track record of delivery › Mainly operate long term, incentive-based contracts that are structured to deliver both performance and cost benefits to

  • ur customers

› Employ around 5,500 people at Devonport and its satellite sites – 257 of these are graduates, 335 apprentices and around 3,600 are in an engineering role › The site has served the Royal Navy for over 300 years and will continue to for decades to come

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Marine Land Aviation Nuclear

› Vanguard Class › Dreadnought Class › Trafalgar Class › Astute Class › Astute replacement › Albion Class (LPD) › T23 Class › T26 Class

Devonport: longevity across programmes

2020 2030 2040 2050 2060 2070

In service Decommission

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Marine Land Aviation Nuclear

Devonport: strong track record

Over the last ten years we’ve delivered: Warship refit programmes › 17 x Type 23 Frigates › 4 x Landing Platform Dock Submarine refit programmes › 3 x Vanguard Class Submarine - Long Overhaul Periods (Refuel) › 6 x Trafalgar Class Revalidation and Assistance Maintenance Periods (RAMPs) › On track to deliver c.£1bn savings

  • ver the life of the Terms of Business

Agreement (ToBA) 2010-2025 across all sites

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Marine Land Aviation Nuclear

Devonport: strategic support partner to MOD

› Integral to key UK programmes › Continuous At Sea Deterrent › Frigate and anti-submarine warfare deployment › Amphibious assault capability › Key contracts › MSDF - TOBA › Vanguard Class refit and refuel › T23 life-extension › Amphibious support › Weapons support contracts

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Marine Land Aviation Nuclear

Devonport: integrated with our customers

› Babcock own and operate the Royal Dockyard and nuclear license site › Babcock operate the Naval Base › Completely intertwined with MOD, Royal Naval and Royal Marines site operations and planning › Unique infrastructure and expertise, not replicated anywhere

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HMS Defiance (MOD) HMS Drake (MOD) Waterfront Wharf's (MOD) RM base (MOD) Devonport Royal Dockyard

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Marine Land Aviation Nuclear

Devonport: integral to customer operations

› Centre of excellence for: › Anti submarine warfare surface fleet (ASW) › All submarine deep maintenance work › Amphibious assets › Weapons support › Base port for: › Albion Class (LPD) › T23 ASW frigate fleet › Future T26 fleet › Trafalgar Class SSN fleet › The forefront of our intelligent support technology

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HMS Defiance (MOD) HMS Drake (MOD) Waterfront Wharf's (MOD) RM base (MOD) Devonport Royal Dockyard

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Devonport Royal Dockyard and Naval Base

Innovations hub on site with a number

  • f ground-breaking technological

projects in progress Currently working on five streams of Type 23 frigates Ongoing investment in infrastructure across the site Only site with the ability to refuel and defuel nuclear submarines Dispatching specialist teams around the globe to support our customer Successful refit programmes

  • n Amphibious Assault Ships

New Engineering and Business hub completed in 2018 New Type 26 frigates will be base-ported at Devonport STEM programme and apprenticeship schemes

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Marine Land Aviation Nuclear

Data acquisition

Sensor technology to capture material state data

Data distribution

Sensor bearer infrastructure to distribute sensor data and allow aggregation, exploiting hard wired and Li-Fi network infrastructure

On Board Analytics

On-Board analytics suite to enable the maintainer to observe & orient data and derive information to enable risk based decisions

Data release control

The maintainer remains in control of on-board data, providing a shore- side link when additional support is required through existing bearers

Shore side analysis

Data analysis shore side to enable forward deployed support to be provided and to optimise the next support period and de-risk Class support to the end of life

Connected Platform

Innovation Vision

iFrigateTM

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Marine Land Aviation Nuclear

Mission Systems

› Weapons centre of excellence - navy gunnery & weapons systems:

  • 4.5” medium calibre gun / Phalanx close in

weapons system / harpoon launch control equipment / Tomahawk land attack missile (TLAM) › Delivering all strategic RF communications and infrastructure for the MOD and customers worldwide › Delivering complex communications systems for land and sea › Supporting counter-UAV and air defence systems including future UK ground based air defence › Asset management and through-life support of complex equipment for the royal navy fleet including pumps, motors and switchgear

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Marine Land Aviation Nuclear

› Frigate Support Centre (refits) › Non-tidal frigate basin (pre/post refit) › Waterfront wharfs (fleet time) › Landing craft basin and facility (refits) › Large vessels docks (refits) › Asset docks (maintenance) › Non-tidal ship and submarine basin (pre/post refit) › Large vessel wharfs (supply and provisions)

Surface ship facilities

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Marine Land Aviation Nuclear

› Submarine and ship basin (non-tidal pre & post refit/power testing) › Seismically qualified dock (SSBN) › Nuclear defueling dock (SSN) › Fleet time support and maintenance dock › Decommissioning/dismantling dock › Maintenance berths › Non-tidal submarine disposal basin

Submarine facilities

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Nuclear facilities

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› Low level refuelling facility › Reactor access house (SSBN refit) › Reactor access house (SSN defueling) › Nuclear fuel transfer rail services

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Marine Land Aviation Nuclear

Summary

› Leader in naval engineering and support, supported by:

› Advanced technology › Technical expertise › Unique infrastructure

› Proven operating model based on unique combination of technical expertise and infrastructure › Technology focused business › Devonport

› Longevity across programmes › Strategic support partner to MOD › Strong track record of delivery › Integrated with our customers › Integral to customers’ operations

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Marine Land Aviation Nuclear

Appendix

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Devonport Royal Dockyard and Naval Base

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Historically MOD owned 1690 1 Dock constructed in South Yard 1853 5,6 &7 Docks constructed 1907 8,9,10 &11 Docks constructed 1974 Frigate Refit Complex constructed 1979 Submarine Refit Complex constructed 1987 GOCO – “SODA” 1997 Privatised, assets purchased 1997 – 2002 9 Dock upgrade 2002 WSMI contract 2002 – present continued site and nuclear investment 2005 Partnering on FNF contract 2009 WSMI extension 2010 Terms of Business Agreement 2013 Energy from Waste Plant (CHP) 2013 Devonport landing craft collocation 2014 14 Dock RAH build and SRC upgrade 2014 MOD opened Royal Marines facility 2015 South Yard regeneration commenced (Council/ MOD) 2016 New Engineering & Business Centre build

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Marine Land Aviation Nuclear

Marine Sector (FY18)

2 5 49% 19% 32%

Bid pipeline

UK 79% UK 67% Intl 21% Intl 33%

Revenue Pipeline

Geography

58% 14% 28%

Revenue split

£12bn

UK Naval International Naval Technology2 7%-11% 8%-12% 6%-15%

Typical margin range1

  • 1. Excludes gain share
  • 2. Includes customer procurement related revenue

Addressable market

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