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Committed to delivering value QinetiQ Group plc Preliminary Annual Results for the year ended 31 March 2013 23 May 2013

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Agenda 1. Headlines 2. Financial overview 3. Business overview 4. Q&A

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Headlines

• Robust overall Group performance in tough markets − Excellent performance in UK Services − Initiating strategic review of US Services − Global Products pipeline – material progress

• Net cash position achieved through strong cash generation

• 31% increase in full year dividend to 3.8p (FY12: 2.9p) reflecting − 39% increase in EPS* in the year − Confidence in Organic-Plus − Commitment to delivering value

* Underlying performance as defined at appendix

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Draft

Financial overview David Mellors Chief Financial Officer

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Summary financial headlines

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13 FY12

(restated^)£m £m Change

Revenue 1,327.8 1,469.6 (10)%

Operating profit* 168.7 159.6 6%

Operating margin* 12.7% 10.9%

Profit before tax* 152.1 110.2 38%

Earnings per share* (pence) 18.9 13.6 39%

Net cash from operations (post capex)* 175.9 235.4

Cash conversion (post capex)* 104% 148%

Net cash/(debt) 74.0 (122.2)

Dividend (pence) 3.8 2.9 31%

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Revenue bridge

1,469.6 (2.4) 6.2 (12.2) (64.1) (69.3) 1,327.8

FY12 Disposals FX UKServices

USServices

GlobalProducts

FY13

£ m

illio

n

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Segmental analysis of profit and margin

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13

FY12

Margin %

Operating profit*FY13 FY12^

£m £m

UK Services 85.8 61.3US Services 21.9 32.1Global Products 61.0 66.2Group 168.7 159.6

14.4%

4.6%

23.9%

10.0%

6.0%

20.4%

UK Services

US Services

Global Products

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Earnings Per Share* (pence)

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

14.6 (1.0) 13.6 1.1 4.1 0.1 18.9

FY12 IAS19restatement &

financeexpense

reclassification

FY12 restated Operatingprofit

Financeexpense

Effectivetax rate

FY13

penc

e

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Specific adjusting items*

* Specific items adjusted in arriving at underlying performance as defined in appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13 FY12

(restated^)£m £m

Non-cash itemsImpairment of goodwill (255.8) -Amortisation of acquired intangibles (14.0) (20.3)Pension net finance expense (1.3) (7.2)Unrealised impairment of investments (0.6) -Impairment of property (4.0) (1.9)Pension past service credit - 141.4DTR inventory recovery - 4.1

Items with cash impactNet restructuring (charges) / credits (16.3) 69.4Gain on business divestments and disposal of investments 2.9 11.6Gain on disposal of property - 9.0

Total specific adjusting items (pre-tax) (289.1) 206.1

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Further strengthening of the balance sheet

(600)

(400)

(200)

-

200FY09 FY10 FY11 FY12 FY13

£ m

illio

n

FY09 FY10 FY11 FY12 FY13 £m £m £m £m £m

Working capital 154.0 107.2 (30.7) (62.7) (148.3)

Retirement benefit obligation (pre-tax) (105.2) (147.3) (124.6) (31.5) (54.1)

Net (debt) / cash (537.9) (457.4) (260.9) (122.2) 74.0

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Movements in net (debt) / cash

†Net interest excludes £20.7m accelerated interest payments in respect of repayment of US private placement debt

(122.2) 63.1 194.4 (18.5) (14.3) (1.6) (20.1) (6.8) 74.0

Net debt31 Mar 12

Netrestructuring

recovery

Cash flowfrom

operations

Net capex Net interest Tax Dividends FX/Other Net cash31 Mar 13

£ m

illio

n

†

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IAS 19 – restatement of FY12

Underlying Reclassification Change in Reclassify Underlyingreported of admin investment pension net restated

FY12 costs return finance expense FY12calculation to middle column

£m £m £m £m £m

Revenue 1,469.6 - - - 1,469.6

Operating profit 161.3 (1.7) - - 159.6

Net finance expense (43.0) 1.7 (15.3) 7.2 (49.4)

Profit before tax 118.3 - (15.3) 7.2 110.2

Tax (23.5) - 3.7 (1.7) (21.5)

Earnings 94.8 - (11.6) 5.5 88.7

EPS 14.6 p - (1.8) p 0.8 p 13.6 p

Net pension deficit(pre tax) - 31 Mar 12 (31.5) - - - (31.5)

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IAS 19 – accounting summary

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13 FY12

(restated^)£m £m

Underlying* operating profit

Current service cost and administration expenses (20.7) (22.5)

Specific adjusting item

Net pension interest expense (1.3) (7.2)

Statement of comprehensive income

Actuarial movements on assets/liabilities (42.1) (102.9)

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Draft

Business overview Leo Quinn Chief Executive Officer

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Markets

• US: visibility well below normal levels − Departments working through impact of sequestration − Drawdown effect − Competitive trading environment

• UK: fiscally challenged − Budgets moved to frontline commands − DE&S – GoCo proposal in consultation phase

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Transforming QinetiQ

• Organic-Plus: repositioning the portfolio around growth − ‘Core’ – win market share − ‘Explore’ – identify significant growth engines − ‘Test for Value’ – manage rigorously

• Maintaining the disciplines of self-help − Focus – where we deliver sustainable value for customers − Cultural transformation – building confidence − Balance sheet strength – paid down £500m+ debt in 3 years

Earnings benefit from self-help and Organic-Plus

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Explore

Scale c8% of revenue

Cyveillance® International Ranges OptaSense® Training & Simulation (+CueSim) Protective monitoring Robotic applique kits and controllers UAS Services Space

Organic-Plus – growing and diversifying the ‘Core’

Close

Invest

Trade-Through

Divest

Goal: high quality cash returns

Maximise c90% of revenue

Core

UK Services

Close

US Services

Global Products (partial)

Maintain the rigour c2% of revenue

Test for Value

ALARMTM MEWSTM

Integrated WarriorTM E-X-Drive® Power Line Sensors GAJTTM

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Portfolio roles

Committed to delivering value

US Services

Aerospace Operations & Systems

Lifecycle Solutions Software & Systems Engineering

Mission Solutions Cyveillance®

Global Products

Weapons Australia

C4ISR

Acquisition Services

Training & Simulation Maritime

Security

UK Services

Space OptaSense® Unmanned Systems

IP & New Technologies Survivability Maritime &

Transportation

Air

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UK Services – performance in year

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

† Excludes the third term £998m renewal of the LTPA contract. Book to Bill ratio is orders won divided by revenue recognised excluding the LTPA contract

Strong foundation; focus now on growth

LTPA renewal underpins core UK business

• Stand-out performance − More competitive cost base − Better project execution − Higher utilisation

• Agreed 5-year, £998m re-pricing of LTPA • Top 3 customer satisfaction for MOD

FY13 FY12^ £m £m

Orders† 414.6 450.3Revenue 597.3 610.1Underlying Operating Profit* 85.8 61.3Underlying Operating Profit Margin* 14.4% 10.0%Book to Bill Ratio† 1.0x 1.1xFunded Backlog† 659.7 633.5

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UK Services – opportunities

Weapons

Air Australia Maritime

Ove

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Stre

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tuni

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• Enables the frontline to deliver cost effective capability

• Provides technical assurance

• De-risks complex aviation programmes

• Impartial advice including military release-into-service

• Federal election likely to create opportunities

• New integrated contracts

• UAS Services (eg UN) • International

(eg India)

• Combines world-leading expertise with unique facilities • Independence

• Long-term managed services contracts • Strong predictable cashflows

• Munitions end-to-end supply chain

• International ranges

• UK outsourcing • Technical advice and

support to Australian naval programmes

Defensible niche capabilities positioned for growth

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UK Services – opportunities

Security Acquisition

Services

Defensible niche capabilities positioned for growth

• Market-leading position in C4ISR research and advice

• Strong demand for highly differentiated offerings

• International (eg Middle East)

• Cyber security protection

• Advice on procurement of complex systems

• Cabinet Office accreditation for Protective Monitoring solution

C4ISR Training & Simulation

• COTS technology to reduce the cost of training

• Grown UK business • Foothold in US

• Invest to exploit $2bn addressable market in US

• New Orlando office

• Opportunities from DE&S GoCo model

• International and non-defence demand (eg rail)

• Market leader in shorter-cycle research and advice • Breadth and depth of technical expertise

• Engaged at all parts of the lifecycle • Enduring markets resilient to events

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US Services – performance in year

* Underlying performance as defined at appendix

Initiating strategic review to determine path to maximum value

Resilient NASA revenue

• Tough markets – lack of visibility • On-going restructuring to stay

competitive • Strong capabilities and market

positions but decline in performance • Initiating strategic review

FY13 FY12£m £m

Orders 461.9 530.3Revenue 475.6 534.5Underlying Operating Profit* 21.9 32.1Underlying Operating Profit Margin* 4.6% 6.0%Book to Bill Ratio 1.0x 1.0xFunded Backlog 203.1 204.7

Copyright NASA

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US Services – opportunities

Niche capabilities with customer base beyond defence

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ngth

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Software & Systems

Mission Solutions

Aerospace Operations

• Cyber security • Enterprise IT and

software

• Support space missions from design to launch under long-term contracts

• C4ISR for Navy and Marine Corps

• Procurement advice

Lifecycle Solutions

• Condition-based maintenance

• Proprietary software

• Engineering services • Fleet and logistics

• Capitalise on Pacific Pivot – increased SPAWAR and naval research budgets

• Broad customer base both within and beyond defence • Skilled employees with high levels of security clearance

• Long-standing customer relationships • Longer-term contract vehicles

• Cyveillance® • Data centre

consolidation – moving to Cloud-based solutions

• Leverage for USAF • Commercial space

Defense Solutions

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Global Products – performance in year

* Underlying performance as defined at appendix

Lumpy revenue profile

$120m sales for Q-Net®

• Strong Q-Net® revenue • Softening demand for conflict products • Good performance in OptaSense® and

Space • Some triage of portfolio • Material progress in developing pipeline

FY13 FY12£m £m

Orders 200.3 245.7Revenue 254.9 325.0Underlying Operating Profit* 61.0 66.2Underlying Operating Profit Margin* 23.9% 20.4%Book to Bill Ratio 0.8x 0.8xFunded Backlog 106.8 162.3

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Global products – broadening the portfolio

PADS®

Test for Value Explore

Q-Net®

SWATS®

Dragon RunnerTM 10

OptaSense® Space technology ALARMTM

Integrated Warrior SystemTM

Power Lines Sensors

LAST® Armour

TALON®

Global Products

…and increased focus on non-conflict markets

Core

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Global Products – opportunities

Build diversified portfolio to reduce volatility

Ove

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Stre

ngth

s O

ppor

tuni

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• Protects people and assets to save lives

• World-leading provider of military robots

• Fibre-optic sensing for real-time decision-making

• Space technology including mini satellites and ion propulsion

• Cutting-edge technology • Intimate understanding of customer problems

• New linear asset apps • Follow-on £10m Shell

deal; end of exclusivity • Starting to contract

with other oil and gas companies

• ESA Proba V satellite launched

• Ion engines proven on GOCE spacecraft

• Platform technology / multiple markets

• Developing international market

• Upgrades to extend the life of existing platforms (eg Q-Net®)

• Developing international market

• Robotic applique kits • Tactical robotic

controllers • DR10

• Growing UK national Space budget

• Commercial satellite opportunities for ion engines

Survivability Unmanned Systems

OptaSense® Space

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Outlook for FY14 • UK Services − Expected to remain steady

• US Services − Heightened uncertainty around US federal services spending is

causing low levels of visibility

• Global Products − As anticipated, budgetary pressures and the drawdown effect seen

towards the end of last year are continuing to affect timing and quantity of sales

• While the range of possible outcomes is wider than usual at this stage in the year and the full impact of sequestration remains unclear, the Board is maintaining its expectations for overall Group performance in the current year absent any material changes in customer requirements

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Reshaping the portfolio to deliver sustainable growth

Committed to taking actions to deliver value

• UK Services − Performing strongly, potential for mid-term growth − Underpinned by 5-year, £998m re-pricing of LTPA

• US Services − Good assets; under-performing − Initiating strategic review to identify route to maximum value

• Global Products − Expanding portfolio – potential beyond defence − Building out non-conflict product portfolio

• ‘Explore’ businesses showing early growth – profitable

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Appendices

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Definitions

• Underlying performance is stated before − Amortisation of intangibles arising from acquisitions; − Pension curtailment gains/losses & past service credits/costs; − Pension net finance expense; − Gains/losses on business divestments, and disposal and impairment of investments; − Restructuring costs; − Gains/losses on disposal of property; − Impairment of property; − Impairment of intangible assets; − Net gain in respect of previously capitalised DTR-programme bid costs; and − Tax effect of the above

• Organic growth − Is calculated at constant foreign exchange rates, adjusting the comparatives to incorporate

the results of acquired entities and excluding the results for any disposals for the same duration of ownership as the current period.

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Detailed income statement

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13 FY12

(restated^)£m £m

Revenue 1,327.8 1,469.6Underlying operating profit* 168.7 159.6Net finance expense (16.6) (49.4)

Underlying profit before tax* 152.1 110.2

Impairment of goodwill (255.8) -Impairment of property (4.0) (1.9)Amortisation and impairment of acquisition-related intangibles (14.0) (20.3)Pension net finance expense (1.3) (7.2)Gain on business divestments and impairment of investments 2.3 11.6DTR inventory recovery - 4.1Gain on disposal of property - 9.0Restructuring (16.3) 69.4

Statutory (loss)/profit before tax (137.0) 316.3

Taxation 3.8 (70.0)

Statutory (loss)/profit after tax attributable to equity shareholders (133.2) 246.3

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Revenue by sector and customer

Revenue by sector (%) Revenue by customer (%)

FY13 £1,327.8m

FY12 £1,469.6m

FY13 £1,327.8m

FY12 £1,469.6m

45%

36%

19%

UK ServicesUS ServicesGlobal Products

42%

36%

22%

UK ServicesUS ServicesGlobal Products

35%

26%

2%

10%

6%

21% MOD

DoD

DHS

NASA

Commercial Defence

Civil/OtherGovernment agencies

31%

29%

5%

9%

7%

19% MOD

DoD

DHS

NASA

Commercial Defence

Civil/OtherGovernment agencies

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Taxation

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13 FY12

(restated^)£m £m

Underlying tax charge* (29.2) (21.5)Tax on non-recurring items 33.0 (48.5)

Headline tax charge 3.8 (70.0)

Underlying tax rate* 19.2% 19.5%

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Balance sheet

FY13 FY12 £m £m

Goodwill 290.4 519.3Intangible assets 57.8 71.8Property, plant and equipment 241.4 246.6Working capital (148.3) (62.7)Retirement benefit obligation (net of tax) (40.4) (18.2)Other assets and liabilities (36.4) (35.2)Net cash/(debt) 74.0 (122.2)

Net assets 438.5 599.4

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Cash conversion

* Underlying performance as defined at appendix ^ IAS 19 (revised) ‘Employee benefits’ has been adopted for FY13 and the FY12 comparatives have been restated accordingly

FY13 FY12

(restated^)£m £m

Underlying operating profit* 168.7 159.6Share of JVs & associates (0.1) (0.1)Operating profit before JVs & associates* 168.6 159.5

Cash flow from operations* 194.4 250.8Net capex (18.5) (15.4)Net cash flow from operations post capex 175.9 235.4

Cash conversion %* 104% 148%

Net interest paid (35.0) (38.5)Taxation (1.6) (23.3)

Free cash flow* 139.3 173.6

37

Movements in net cash / (debt)

FY13 FY12 £m £m

Free cash flow 139.3 173.6Net restructuring inflow/(outflow) 63.1 (8.9)Acquisitions and investments - (0.9)Divestments and sale of investments 3.8 14.8Dividends (20.1) (16.4)Purchase of own shares (0.4) (12.0)Other 18.6 (9.8)

Change in net debt before FX 204.3 140.4

FX translation impact (8.1) (1.7)

Change in net debt 196.2 138.7

Opening net debt (122.2) (260.9)Closing net cash/(debt) 74.0 (122.2)

38

Defined benefit pension scheme – IAS 19 balance sheet position

FY13 FY12 £m £m

Market value of assets 1,256.5 1,107.9Present value of scheme liabilities (1,310.6) (1,139.4)

Net pension liability before deferred tax (54.1) (31.5)

Deferred tax asset 13.7 13.3

Net pension liability (40.4) (18.2)

FY13 FY12 Assumptions % %

Discount rate 4.4% 4.8%Inflation (CPI) 2.7% 2.6%

Sensitivity of deficit to main assumptions:

Assumption Change in assumption Sensitivity

Discount rate Increase / decrease by 0.1% Decrease / increase by £25mInflation Increase / decrease by 0.1% Increase / decrease by £26mLife expectancy Increase by 1 year Increase by £28m

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Three year record for the years ended 31 March

As reported 2013 2012 2011

Underlying operating profit £m 168.7 161.3 145.4 Underlying profit before tax £m 152.1 118.3 114.6

(Loss)/profit before tax £m (137.0) 331.6 26.6 (Loss)/profit after tax £m (133.2) 257.9 5.0

Underlying basic EPS pence 18.9 14.6 14.2

Basic EPS pence (20.5) 39.6 0.8 Diluted EPS pence (20.5) 39.4 0.8

Restated for adoption of IAS19 (revised) 2012 20112013 (unaudited) (unaudited)

Underlying operating profit £m 168.7 159.6 143.7 Underlying profit before tax £m 152.1 110.2 103.8

(Loss)/profit before tax £m (137.0) 316.3 7.9 (Loss)/profit after tax £m (133.2) 246.3 (8.8)

Underlying basic EPS pence 18.9 13.6 13.0

Basic EPS pence (20.5) 37.9 (1.3)Diluted EPS pence (20.5) 37.6 (1.3)

40

Credit and debt facilities

Value Value Maturity date Denomination in denomination £m

Revolving Credit Facility February 2016 £m 118.0 118.0Revolving Credit Facility February 2016 $m 250.0 164.8Private Placement February 2016 $m 43.0 28.3Private Placement December 2016 $m 48.0 31.6Private Placement February 2019 $m 157.0 103.6

Total Committed Facilities 446.3

41

Employee numbers

FY13 FY12

UK Services 5,145 5,157US Services 3,350 3,940Global Products 1,003 1,083

Total 9,498 10,180

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Disclaimer This document contains certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Actual results, levels of activity, performance, achievements and events are most likely to vary materially from those implied by the forward-looking statements. The forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words 'believes',' expects’, ’predicts’, ’intends’, ’projects’, ’plans’, ’estimates’, ‘aims’, ‘foresees’, ‘anticipates’, targets’, ‘goals’, ‘due’, ‘could’, ‘may’,'should’, and similar expressions. These forward-looking statements include, without limitation, statements regarding the Company's future financial position, income growth, impairment charges, business strategy, projected levels of growth in the relevant markets, projected costs, estimates of capital expenditures, and plans and objectives for future operations. Nothing in this document should be regarded as a profit forecast.

The forward-looking statements, including assumptions, opinions and views of the Company or cited from third party sources, contained in this Results Announcement are solely opinions and forecasts which are uncertain and subject to risks. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to be correct. Actual results may differ materially from those expressed or implied by these forward-looking statements. A number of factors could cause actual events to differ significantly. These factors include, but are not limited to:

Defence budgets which are subject to review and change from time to time and the level of available funding open to private contractors in the United Kingdom and United States;

The winning of new business or retention of previous business through a competitive bidding process;

The level of pension liability the Company accrues, given market conditions and actuarial factors;

Material adverse changes in economic conditions in the markets served by the Company; and

Future regulatory actions and conditions in the Company's operating areas, including competition from others.

Most of these factors are difficult to predict accurately and are generally beyond the control of the Company. Any forward-looking statements made by, or on behalf of the Company, speak only as of the date they are made. Save as required by law, the Company will not publicly release the results of any revisions to any forward-looking statements in this document that may occur due to any change in the Directors’ expectations or to reflect events or circumstances after the date of this document.