[Call started abruptly] compared to H2 2020, where recurring operating income represented 8.2% of revenue after taking into account the effect of the activity conservation agreements in 2020. On the cash side, a good cash generation of orders to reduce the net debt in H1. On Slide 7, 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 backlog stood at more than 9,300 engines and we have a market share on A320neo families close to 60%. While CFM56, the progressive rundown continued as plan, 49 engines were shipped in H1, out of which 23 in Q2. Mid-June, Green aviation and Safran launched the board development program to CFM Rise targeting for more than 20% lower fuel consumption compared to current LEAP engine. We also extended CSM in international partnership agreement by 2050. On aftermarket, given what we have observed in Q1, it is not to suffice that civil aftermarket revenue was down 25.5% in H1, compared to H1 2020, even with a year-on-year growth of plus 55% in Q2. Remember that Q2 2020 is a very low comparison business. Step-up sales in H1 are still down year-on-year, especially CFM spares, and services contract slightly decreased. In our helicopter business, the Arrano 1A engine that powers the Airbus helicopter H160 is now certified in both Europe and United States. On Slide 8, a few words on our Equipment, Defense and Aerosystems division and 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 aircrafts 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 Airline Group, including A320, A350, 737-800 NG, 737-8 MAX and 787. Safran signed a 12-year NacelleLife service contract with Corsair for the nacelles of its five Airbus A330neo. With this contract, the group commenced to the repair of the nacelles and the general service of the thrust reverser at the time of our programmed 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 complement the Geonyx land range as well as the Argonyx and Black-Onyx ranges intended respectively for first-rank surface vessels and submarines. Coming to our Aircraft Interiors division, Safran regains customer interests in its products and achieved several commercial successes in H1. In particular with a German airline for the crew rest areas and the Skylounge Core business class seats of its future fleet of 16 A330neo aircraft. Our Middle East airline provide new Vue business class seats for its Boeing 737 Max, and an Indian airline provide linefit Z200 economy class seats for 75 A320 and A321. Slide 9. Efforts that we are 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 importantly 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 the result of two different effects in opposite directions. On the one hand, we benefit from a lower headcount that is still decreasing yet at a slower pace. On the other hand, outsourcing, 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 Component site in Santa Rosa, California, which is within Safran Electric & Power. All-in-all, in regards to costs, we navigate the crisis with a very cautious approach and put the same pressure on cost 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 a HR costs and overall use of short term just explained. CapEx commitments are kept under control and the impact of CapEx from cash is decreasing year-on-year. I’ll now give the floor to Bernard for the financials for the first-half 2021.

Thank you, Olivier. Good evening to everyone. Slide 12 just as a reminder, we know that the coverage spot rate was $1.21 against euro this year. It was at $1.10 last year, it would create 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 and we have some market impact of the spot rate at close in our accounts that we explained in the adjusted debt. On Slide 13 of the page on our FX strategy the hedge book totaled €29 billion at the beginning of this month. The euro-dollar fix has $1.23 from January and then the trend reversed and based on U.S. flow from central banks leading to a stronger draw down with the euro-dollar reaching a low point at $1.17 at the end of March. So we took this opportunity first to spread the risk of KO by moving away the nearest barriers, now 83% of this KO barriers are above $1.25 and we also took the opportunity of these FX on scale to add new options to the 2024 book has strived consistent with our long-term rate targets between $1.14 and $1.16. But for 2021, we are very comfortable with achieving a rate, hedge rate of $1.16 for the full year. I suggest we skip the Slide 14, which is the usual bridge between consolidated data and adjusted data that I will commence. So let's move to Page 15. One-off items were negative for €195 million, it reflects impairments for one equity accounted investment and several products. We also booked €31 million of restructuring costs. Net financial income was €84 million negative compared with €117 million in H1 2020, it reflects a higher cost of debt with €61 million cost of debt in H1 this year, including the cost of two major transactions for bonds and converts in H1. And it also reflects foreign exchange losses of €28 million this year. Income tax charge was €100 million, representing an apparent tax rate of 26.2%, so adjusted net income group share was €269 million. EPS was €0.63, a decrease of 47%. On Slide 16, on the revenue. So, adjusted revenue reached €6,876,000,000 in H1, down 21%, and we're still at €57 million on H1 2019. Two comments here, currency reflects a weakening dollar, and Q2 sales for all divisions are now above Q1 level. Of course, Q2 comparison basis is much easier than Q1. So the 10% increase in Q2 is a good start of the recovery. But again, comparison basis we’re low. It's not returning the slide, but I think it's worth mentioning that the 10% organic growth in Q2, the breakdown is 14%, 1-4 on propulsion, 9% in equipment, but still down 4% percent in Ontario. On Slide 17, recurring operating income went down for - from €947 million in H1 2020 to €659 million in - at the end of June. So it's down 30%. On an organic basis, recurring operating income went down 29%. We have experience strong negative volume impacts on all activities especially civil aftermarket which is obviously detrimental to recurring operating income recovery. And on the other hand, cost savings have been achieved in 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 2020 when compared will not bring the same savings in 2021 compared to 2020 and some external services that have been frozen in 2020 have to rebound. But 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. And I think that's one of the main achievements of the first half of 2021. So the group recurring operating margin stood at 9.6% of sales which remained 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 €640 million, of which more than €426 million for self-funded R&D. R&D sold to customers, which includes works funded by agencies mostly in France, is increasing by €64 million compared to H1 2020, mainly driven by higher funding and the works coming from the French aerospace plan. Self-funded R&D expenses decreased by €21 million notably due to lower development expenses and civilian regional tech hub problems. Given the back-end weighting for prior expected in terms of activity and profitability, we have very carefully managed R&D expenses. We decreased by 35% compared to H1 2019 and in line with savings achieved in 2020. As a result, R&D impacting P&L decreased by - decreased at 4.7% of sales. On Slide 19, the other view of business performance, all three divisions recurring operating income have been impacted by negative volume impact and a negative effect of under absorption of fixed cost, but a positive impact coming from lower expenses and this is what I'm going to explain on the next slide, starting with Propulsion on Slide 20. Revenue was €3.249 billion, down 20% or down 15% on an organic basis. OE revenue were down 15.6% in the first half due to lower LEAP engine deliveries and CFM56 continues run down. We delivered 399 LEAP engines, that is 11% less than in H1 2020. And we delivered 49 CFM engines - 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 and 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. Service contracts slightly decreased as well. Two activities have been resilient in propulsion. Helicopter turbines activities was a double-digit organic growth, thanks to services and OE military sales, thanks to higher M88 deliveries although half our program as planned. Recurring and operating income decreased at €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 of completion for long term CFM56 services contracts. For equipment on Slide 21. So sales totaled €2,972 million, down 18% or 14% on organic basis. OE revenue was down 20% or 15% on 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 landing gears support activities and nacelle. Despite the defense support growth, electronics and defense activity is decreased in H1mainly driven by avionics sighting guidance systems electronic activities. Profitability increased at €270 million and represents 9.1% of sales. And this increase is mainly driven by the drop in volume and the one-off items were €59 million were booked mainly due to impairment of three programs. Now aircraft interiors. Sales totaled €646 million it's down 40% or 35% organic. Aircraft Interiors is again the division that has the most suffered from the crisis. We believe it has reached a trough in Q1. OE revenue were 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 capturing inserts. And in seats due to lower volumes as business class seats were down by almost 60% in H1 2021. Services revenue in aircraft interior were down 45% or 42% organic. And again 5% in Q2 driven by [indiscernible] as well cabin sales and the nacelles activity. So the recurring operating income decreased again and was negative for €110 million, operating margin was strongly deteriorated at 17% negative. But thanks to cost cuttings, recurring operating income decrease remained limited considering the size of the sales decrease. Operating income reduced by €10 million this semester when sales are down more than €400 million. It demonstrates the depth of the restructuring achieved in this business that paves the way for a strong rebound as soon as demand comes back. Some words on free cash flow. Free cash flow reached €700 million despite a 24% decrease in EBITDA. Free cash flow generation was driven by cash from operation of €733 million. Tight control maintained on investment of €329 million, down four - from €421 million in H1 2020. And working capital improved by almost €300 million this semester essentially driven by a strong increase in receivables and 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 that convertible in June on top of a €500 million bank loan signed with the EIB at the beginning of this year. So in a nutshell, Safran liquidity is strong and sound. And I guess that Page 25 say almost the same thing with a net debt of the last 12-month EBITDA at 1.2 point to at the end of June. Net debt is - has been reduced and nothing really to say on the balance sheet at the end of June. Olivier, over to you. Olivier Andriès: Thank you, Bernard. Turning to Slide 29 and to conclude this presentation, the evolution of air traffic at the global level is consistent with what you have seen - what you have just seen 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, and 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 raised for free cash flow. Taking track on half our export contracts, advanced 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.

[Operator Instructions] And we have our first question from Robert Stallard from Vertical Research.

Thanks so much and good afternoon. I have two questions, please, so the first one as 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? And then 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 production rate, current production rate of 16 per month? Thank you. Olivier Andriès: Yes. Hello, Robert. Yes, indeed. As Bernard said, the aftermarket in Q2 improved versus Q1 by 15%. I will not say we see airlines pulling forward. We don't - spare parts purchase, we've not seen that yet and deliveries to Boeing for the, MAX Boeing has indeed increased their monthly rate of production. Remember that we have delivered quite a number of LEAP engines to Boeing in the course of 2020 in advance of their need. So they’re still a significant number of LEAP engines, but I was there in Seattle, ready to be mounted on aircraft. So 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 all the - sorry…. Olivier Andriès: Now overall, we - I mean we said at the beginning of this year that the number of LEAP engine 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 north of 800. So it's going to be a step-up versus 2020, small step-up. More LEAP-1 engines delivered to Airbus less LEAP-1B delivered to Boeing because - once again because of the advance delivery we've made in 2020.

Thanks. Its very helpful. Thank you.

So we have another question from Celine Fornaro from UBS. Please go ahead.

Yes. Good evening. Thank you for taking my question. My first question would be regarding on the spare parts performance in the propulsion division. And I know in Q1 the weakness, you explained it, due to the catalog issues that you have in Q4. So clearly there was a pull forward there at the end of last year. What are you seeing in Q2 and also presumably now, you start to have a feel of what could happen in Q3? So does that relate to the more cautious statement that you're making on aftermarket for the remainder of the year? So that would be my first question. And 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 widebody exposure for the second half? Thank you. Olivier Andriès: Okay Celine, spare parts, yes we - I have explained the pull forward as one of the reasons why there was a slight decrease in revenue per share in Q1, 2021 compared to 2020. You said as well that there was also which is some airlines pushing fan and tubing part of the roster pushing forward. When I look at the - in Q2, our revenue per share basis we are in the same vein as Q1. So, basically, the trend that we are seeing in Q1 has remained in Q2. We see a step up of - step up sale in Q3 in addition to the pickup of the air traffic that we are forecasting. And basically what we seen, remember, we were at minus 40% of the now already ASK in June, end of July we have close - we outlined as 30% so we are seeing a step up, so normally that should materialize in spare part revenues soon in Q3. In terms of profitability as Bernard said there has been a tremendous action plan to reduce the breakeven point apart from seats and cabin. The fact is that H1 has been the 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 folds in H1 versus H1 2020. So now going forward on seats we expect better H2 than H1 with let's say more activity and a better top line, same for cabin. And so we still target a breakeven at the very, at the very end of the year and now maybe Bernard you can complement.

Yes, okay it means that you just cannot take the first half as the run rate of losses for second half. We need to and we think we’re going to have it. That − I think the best guidance I can give for H2 losses for interiors. Do you get it?

Thank you.

Celine, so it was…

Yes, you meant that you’re going to maintain the loss for it over the full year.

Of course it’s going take the loss making in Q3 and we hope we can breakeven somewhere in the last quarter. So, on a full year basis it’s going to be above what you’ve seen at the end of June. But 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.

So we have another question from George Zhao from Bernstein. Please go ahead.

Hi. Good evening everyone. First question, we've seen pretty strong traffic recovery in U.S., China, and Europe. But as you’ve noted, the other remains - the other regions still remain quite weak. So could you quantify for us the proportion of your narrowbody engine fleet before COVID that was outside of those three stronger regions? And given that we're now more than halfway through the year and total narrow-body ASK 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? And second question, a quick one, on equipment, could you just elaborate on which product - U.S. have been leading the aftermarket recovery, and how that compares versus propulsion you’ll get similar aircraft class, so narrowbody engine versus narrowbody equipment? Any color there? Thanks. Olivier Andriès: Okay hello, George. On the respective weight of the various regions for our, let’s say, CFM business and cycles, to give you some guidance, Europe weighs for around 30%, Europe including Russia and CIS, close to 30%, North America is about 20% - 22%, 23%. That's about it. China is around 15% and APAC as well. APAC is Asia Pacific is around 15% to give you some keys. Okay. On the equipment's, I will let Bernard response.

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 in the wheels and brakes versus some of the other ones.

Yes.

Any color for China and other regions.

So Q2 for the Equipment division was 4% up on an organic total revenue, but it's up 9% on an organic basis. And the main part is coming from our nacelles 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 Aerosystem division has also done a quite a good job. Electrical & Power and our electronics and defense business in Q2 were a bit more flattish if not down. This is how I can detail the pickup in revenue in the Equipment division. And again, I would say that most of the improvement came from services. From - on an organic basis services. From - on an organic basis, the equipment in services were up 18%, 18%. And I would say that all divisions excluding Electrical & Power were up in services for equipment in Q2.

And then in any comparisons to the propulsion, say, when you take a similar like Narrowbody versus Narrowbody? Olivier Andriès: We actually 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. And -- so thanks guys for taking my question. So, 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. So, could you give us a bit of color about how your seeing shop visit visibility and how that kind of plays into your aftermarket expectations in the second half of the year? And then 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 and 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 Market Day at the end of the year. I think that will be the right timing and place to talk about capital allocation. So please keep your questions for later on. Olivier, you want to take the one or I can answer on GE? Olivier Andriès: So, basically Ben, what we’ve said at the beginning of this year and we confirmed that the total volume of shop visit for 2021 should increase compared to 2020 by mid-teen. So this is our number. At the end of H1, we are below the volume of shop visit that we have reached in H1 2020. Just simple math because of the strong Q1 2020, so 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. So there has been one step. We see a further step in Q3 that 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. And by the way I think that's 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. And I guess outdoor, partner in GE, they are looking at all shop visits not only second gen for CFM56. I’m not talking about non-CFM engine.

Okay. That's fair. Thank you.

So next question from Jeremy Bragg from Redburn. Please go ahead.

Good evening guys. Thanks for taking my question. So first question please, are you still - given that we're tracking a little bit below the trend line on narrowbody ASKs. Are you still comfortable with your guidance of getting back to 2019’s level of shop visits by 2023 please? And then the second question is on my favorite topic which is revenue shop visit and USM. Could you just give us a feel please at 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 this system through pricing increases and is there a risk that if you put prices up, you kind of drive customers to use more USM. Thank you.

Okay. Jeremy, I will take those questions and maybe Olivier will make some comments after.

Thanks.

In terms of long-term or midterm trends, I must say that this is 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 say that ASK is lagging behind although what we have in mind the beginning of the year in terms of strength. We will update that. I think it is too soon. It's really something complex because we have to take into account green timing, retirement, the amount of deliveries that the Airframers will put in the market. And so there are so many moving pieces here. I think it's too early to update you on that. And 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. And - but 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. So I think that the level, the amount of USM is still a question mark for us for the future. But the basics of our answer saying that you cannot take any retired aircraft and takes the part out to maintain a new aircraft, this is still valid. I mean, 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 the new generation engines. So that's again a bit tricky and we are working on that to refresh our assumptions…

Yes.

For the Capital Market Day.

Okay, thank you. May I ask… Olivier Andriès: Jeremy, now, what we can see is short-term, because there are has been a low number of retirements in 2020 and the early part of 2021. We want to see the share actually in used parts in the short-term future in the coming months. We want to see that in the coming months, and we will update you, as Bernard said, of the capital market.

Lovely. Thank you. And 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. So 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? Olivier Andriès: Thanks for the question. We are listening carefully to all our customers, airline customers leading company customers is one. And I have to say, we are not sure that the market has the appetite of such heights. And that said, well over 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, and we are discussing with them the numbers for 2023.

Lovely. Thank you so much.

So, we have another question from Tristan Sanson from Exane BNP Paribas. Please go ahead.

Yes. Good afternoon. It’s Tristan from Exane. First, thank you so much for bringing forward truly the - to this evening. It’s much appreciated, this - to this evening is much appreciated, much simpler for us. I have a few technical questions to ask so I apologize for that. The first one is on the employee profit sharing agreement. So I remember that in H2 last year you released a provision by €103 million, which was actually - was kind of excess 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 you have in H1? Is it similar to the provision that you released in H2 last year? Is it similar or not at all to give a - to get a feel for what will reverse when 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 impacting the recurring operating income in H1? What does it refer to? And is it significant in number? And 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 a Greece and Egypt, is it - well, showing some improvement compared to your initial vision on it? Many thanks. Olivier Andriès: Okay. I would start with the last one, Tristan. Excluding the Rafale prepayments recent announcements, it’s going as planned. I mean its okay, no major issues. So I was already comfortable with the initial guidance, and that I am even more comfortable today with the announcement of some new prepayments for Rafale. The repayable advance in Propulsion, so you know how it works. We get some funding for some specific programs and if the programs are now successful, we don't have to repay that. So, that's - when you book that, it's a positive. It's a one-off. It was not material in the propulsion business but as we have all the exceptional negative, I would say that the net exceptionals in the Propulsion was something like €50 million at the end of H1, taking that into account but also other negative exceptionals. And…

€50 million net positive? Olivier Andriès: Net positive, yes.

Thanks. Olivier Andriès: Yes. And for the employee profit sharing agreement, I don't know exactly what you mean. But if - I mean the savings that we made, if I may say so in 2020 where based on the kind of target that we add before the crisis. So 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. So, I'm sure that the reversal would be not as high as a savings as the improvement in profitability will be gradual. So, 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 when I look at some market there. But that’s useful comments. Thank you, Bernard.

So we have another question from Chris Hallam from Goldman Sachs. Please go ahead.

Yes. Thank you for taking my question. So, first just to come back on the point you made that you aren't sure whether rate 60 is sustainable. I just wonder if that a Boeing 737 plus A320 comment i.e., is that 120 per month because I suppose it's quite plausible that we end up in a sort of 70/50 production split between the two manufacturers. We’ll put it another way what Boeing 737 rates are you assuming to be uncertain on rate 60 from Airbus? And then separately on free cash flow previously you'd expected a balance stage rate to split which probably meant around €550 million per half and you've obviously done much better than that in the first half. Now we have prepayments in the second half on the military side of probably around €150 million. So should we be expecting around €700 million in the second half or with some of the H1 performance we saw or pull forward from the second half? Thanks. Olivier Andriès: Let's start with this one, Chris. Thank you for the question. No, don't think just the math as you do that. Don't think the €700 million as the right for the rest of the year because part of the strong H1 was due to some actions that we plan to do on the H2, so no it’s not going to be as high as the figure that you just mentioned. Olivier Andriès: Okay. Chris please. Sorry. Yes.

Yes. Go ahead. Sorry.

Yes. Chris on rates. Just I would like to outline that Blanc as being significantly successful in the first half of 2021 in gaining additional orders. They've got more than 500 additional orders for the MAX. So the good news is that the MAX sales gained just enough confidence, and Boeing has secured big orders from Southwest, United, Alaska, Ryanair, and I guess there are more to come. So, I mean, you should not bet on a significant imbalance in market share between both air frames. That would be medium term instead.

Okay. That's helpful. Thank you.

So we have another question from Christophe Menard from Deutsche Bank. Please go ahead.

Yes. Good evening. Thank you for taking my questions. I have three quick ones. Going back to GE and what they said, they said that - I mean, I understand that it applies to all their shop visits. So my question was more on the second generation. They said green time impacted them in Q2, but they expect less of green time impact in Q3 and Q4. Does that comment also apply to CFM56 second-gen, according to what you see at the moment? Second question is FX and the efforts you made on the - I mean, 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 rate, or 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 into provisioning some spares or equipment in the aircraft equipment division specifically in Q2. Olivier Andriès: I will take this first and the third one we let Bernard answer on the exchange rate. In the meantime, what we have seen in H1 2021 is in the range as what we’ve seen since the start of the pandemic. Same range as H2 2020. And so we expect to 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 are not seen big IP orders from airlines for our equipment business. We've not seen that.

Okay. And for FX I will keep the range. It's too early to tell you exactly where we will end up in the range. The range today the spot rate is $1.18. 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. So if the spot rate stayed at the same level you cannot expect to decrease the hedge rate from $1.16 which is a situation today to lower levels.

Okay. Thank you very much for the answers.

So we have another question from Harry Breach from Stifel. Please, go ahead.

Yes. Thank you very much for taking my question. Good evening. Olivier, good evening Bernard. 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 sales of CFM56 fleet for the recent week, could you please just repeat those data points, those figures you gave? Secondly, doesn’t - we've talked a lot about spare parts and aftermarket. I'm just wondering if we think about the spare engine side of the business, is that still very, very slow at trough levels or are we starting to see any pickup on that side? And then just 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 level of concern improving or maybe going the other way? Thank you.

Maybe I can start with the supply chain to explain again how we manage the situation. We have watched dollar, when we look carefully at €700 million, which is a small portion of our supply chain but we carefully watch €700 million. And we think that there are - let's say, a bit more than €100 million, less than €150 million which are in a situation that needs really to be to be managed. But for the moment, we haven't seen a lot of suppliers really turning into a very bad shape. Very handful, I would say. I've experienced a critical situation. So, 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. So I would say that today that 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 that the situation had not much changed. I mean, we haven’t seen a lot of new orders I would expect it to be stable in 2021 versus 2020 I mean you can’t airlines to purchase a lot of spare engines in the situation today. So stability I think the message here. Olivier Andriès: Yes, we saw same number of the engine in H1 2021 than in H1 2020 and in cycles. So in June 2021, I mentioned that the narrowbody ASK, so average seat kilometers, were at around 60% versus 2019 so basically minus 40%. That was in June now we are end of July. In end of July, we are minus 30% versus 2019. This is year-on-year, same week that we compare, okay. On this is varying depending on the regions, very irregular. For China, we've come back to the 2019 level in terms of cycles. In Asia Pacific, minus 70, I said minus 71 that’s minus 70 roughly. In North America, we are minus 15, and in Europe we are at minus 34. This is now end of July. This is where we are. So this gives us and overall minus 40. Now, we’ve seen for all CFM engines. Now, the LEAP engines are flying more, because they are - more LEAP engines flying now than that used to be in 2019. So they're flying more and the CFM56 engines were at minus 45. Does it clarify?

Yes. That's really helpful. Thank you, Olivier, thank you, Benard.

So 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 wanted to ask about some of the exceptional costs that you highlight in the first half of 2021 particularly the €180 million charge. Is that basically the same or equivalent to what your joint venture partner called out on one particular loss making contract? And can you shed any further lights on that what type of aircraft that is. And then a couple of longer term questions. Firstly, in terms as you look at your fleet at the moment, I understand your 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 that third shop visit? And finally, maybe an even longer term question, following up on the presentation around the rise demonstrated 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 actually for me. So we’ll start with the first one with exceptional cost. And do you refer to the €195 million negative one-off items that we booked in H1? If it's related to that it's really at the depreciation of an intangible R&D asset for our space business, most of that.

Okay.

So there is nothing like loss for contracts or nothing like that just…

Okay.

Depreciation.

Understood. Olivier Andriès: Okay. On the long-term question, shop-visit number three, third shop visit. I have to say that we have not made the breakdown between shop visit one, two and three with our members. There are very few short visit number three roughly it is [called young]. So we are talking many shop visit one and two as we speak. And so I don't have any flavor to give you on shop number three. Anyway shop visit number three is much less significant for us in terms of revenues.

And if any that will be because of first generation of - on the CFM56 engine, so very limited impacts, yes. Olivier Andriès: No, I'm not sure I understood your question on the highs and LEAP improvement. Can you please repeat and clarify?

Yes, of course and apologies if it was a bit unclear. I mean - I guess what I’m driving at here is you’ve 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. Olivier Andriès: 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? Olivier Andriès: 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. So, within RISE, there’s a significant layer of underlying technologies, plus this disruptive architecture. But the underlying technologies that we are working on could apply to any kind of engines, whatever the architecture is, including the LEAP engine. So we would use this layer of underlying technologies that thought would composite. We would go more composite for the forward part of the engine. We would go additive manufacturing. We would improve here and there. So those underlying technologies could apply to LEAP improvement program for an intermediate timing horizon. It could apply to any kind of new engine. Is this clear does it clarify?

Yes, it does. Olivier Andriès: I will not quantify - but I will not quantify.

No, that's very helpful. Thank you. Olivier Andriès: Okay, thank you, Andrew. So we are done. Thank you.

Good evening. Bye-bye.

So we have no further question, gentlemen. And ladies and gentlemen, this concludes today's conference. Thank you for your participation. You may now disconnect.