Embraer Day BR 2014 Executive Jets

This information is the property of Embraer and cannot be used or reproduced without written consent.

Embraer Executive Jets

Marco Tulio Pellegrini

President & CEO – Embraer Executive Jets


Embraer Executive Jets fleet evolution

Source: GAMA, October 2012 and analysis Embraer

13 13 20 27 36 38 122 145

99 99 119 8 21 34 54 81

117 155

277

422

521

620

739

100

200

300

400

500

600

700

800

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Nu

mb

er

of

airc

raft

Deliveries EEJ fleet (accum)


Executive Aviation - Revenue evolution

145 175 246 278

582

838 874 937

1,210 1,119

1,292

1,645

´02 ´03 ´04 ´05 ´06 ´07 ´08 ´09 ´10 ´11 ´12 ´13

Net

Rev

enu

e (U

S$ M

M)

CAGR = 22%

P1

00

EIS

P3

00

& L

10

00

EIS

L65

0 E

IS

L60

0

EIS

7%

Commercial and Defense Executive Jets

27%

2013 2005

Embraer revenue per segment


Source: GAMA, Feb 2014 and Embraer analysis

Phenom 300 (All bizjet market)

37th 11th 5th 2nd 1st

Phenom 300 - Market share evolution

2% 11% 11%

1%

12% 5%

2% 6% 4%

16%

10%

8% 2%

20%

15%

11% 13% 12%

39%

18%

15% 15%

12%

17%

34% 31%

26%

1%

24% 30% 34%

47%

2009 2010 2011 2012 2013

Phenom 300

CJ4

CJ3

CJ2+

Premier IA

Learjet 40/70

H 400XP

SJ-30-2


EEJ market share evolution since EIS (units)

Source: Jetnet and Embraer analysis – February 2014

5

22% accumulated since EIS, within the markets EEJ competes

0%

10%

20%

30%

40%

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Mar

ket

shar

e

5% 9%

16%

21% 22%

0%

10%

20%

30%

40%

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Mar

ket

shar

e


EEJ market share (New aircraft delivery revenues)

6

Total revenue

Source: GAMA and Embraer analysis

$21.8Bi $17.3Bi $18.2Bi $18.1Bi $21.2Bi $17.7Bi

This information is the property of Embraer and cannot be used or reproduced without written consent. 7

Embraer Executive Jets at a glance


Entry

Light

Mid-light

Mid-size

Super Mid-Size

Large

Ultra-Long Range

Ultra-large EIS 2009

EIS 2010

EIS 2002

EIS 2009

EIS 2008

EIS 2014

EIS 2015

Embraer product portfolio


Owners utilization profile (average FH/year)

Source: Jetnet IQ 2Q13 report proprietary data.

Embraer owners tend to have a better annual utilization leading their businesses to higher productivity

344

393

433

445

440

393

372

350

616

0 200 400 600 800

Small jets

Medium Jets

Large Jets

Gulfstream

Dassault

Bombardier

Cessna

Hawker

EMBRAER Owners

Ow

ner

scl

ass

Ow

ner

s O

EM


High utilization and reliability

Source: BofA Merrill Lynch Research , January 2014 Y/Y % change in 3M rolling average

Total operation (Y/Y% - 3M)


Top 10 best “liquidity” performers

Source: Jetnet, January 2014. Considers only currently in production jets, with an active fleet of 30 or more aircraft

Rank Models Days on market

Active fleet

Fleet for sale

Fleet for sale (%)

1st GULFSTREAM G-650 37 49 1 2.0%

2nd EMBRAER LEGACY 650 51 52 1 1.9%

3rd EMBRAER PHENOM 300 82 177 5 2.8%

4th GULFSTREAM G-550 119 428 12 2.8%

5th AIRBUS ACJ319 148 68 2 2.9%

6th CITATION CJ4 160 140 5 3.5%

7th CHALLENGER 300 207 428 25 5.8%

8th GULFSTREAM G-450 234 279 22 7.8%

9th CITATION CJ3 245 405 23 5.6%

10th EMBRAER PHENOM 100 262 294 20 6.8% .


Brazil | São J. Campos

Phenom 100 & 300 Legacy 450 & 500 Legacy 650 Lineage 1000

USA | Melbourne

Phenom 100 & 300 Legacy 450 & 500

China | Harbin

Legacy 650

EEJ manufacturing plants: global distribution


Legacy 500 program status

Four prototypes in flight test

1,100+ flight hours

21,000+ systems test hours performed

On track for EIS in 1H 2014


Legacy 450 successful first flight on Dec, 28th


Customer Support and Services


Embraer Service Center

Authorized Service Center

New Embraer Service Center in São Paulo - Brazil

Service Center network

Nearly 70 service centers worldwide


New Service Center in São Paulo, Brazil

MRO since November 2013

FBO start-up: March 2014

200,000 SQFT and US$ 25 MM investment

Sorocaba Service Center


Customer satisfaction: 2nd position maintained

18

“Embraer is creeping even

closer to the top spot, up 0.1

to 8.2 from last year’s 8.1”


Market overview


Market recovery depends on many factors

Source: Embraer Analysis

Sales of New

Business Jets

Corporate Profits

Willingness to invest

Finance conditions

(for small jets, and Asia mainly)

Pre-owned Market

Business Aviation Traffic Wealthy

Population

Exchange Rates

Stock Markets

Airport Infrastructure

Regulatory Environment


U.S. corporate profits

Source: BEA – Bureau of Economic Analysis and Embraer estimates, January 2014. Seasonally adjusted at annual rates

2.288

0

500

1.000

1.500

2.000

2.500

Q3

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

US

Co

rpo

rate

Pro

fits

(U

S$ B

i)

+43% +129%


Worldwide HNWIs population

Source: World Wealth Report 2013 edition

7.78.2

8.89.6

10.1

8.6

10.110.8 11.0

11.9

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Po

pu

lati

on

(mi)

North America Europe Asia-Pacific Latin America Middle East Africa


Business Jet Traffic – United States

Source: FAA – February 2014

100

130

160

190

220

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Tho

usa

nd

of

Flig

hts

2007

2009

2012

2013


Source: Jetnet and Embraer Analysis, February 14th 2014

11.8% 2316 jets

7.4% 600 jets

0%

4%

8%

12%

16%

20%

24%

28%

0

500

1.000

1.500

2.000

2.500

3.000

3.500

´00 ´01 ´02 ´03 ´04 ´05 ´06 ´07 ´08 ´09 ´10 ´11 ´12 ´13 ´14TD

% o

f ac

tive

fle

et (

Lin

es)

Un

its

(Bar

s)

Fleet older than 10 yrs Up to 10 yrs & positions

Total fleet % for sale Up to 10 yrs % for sale

Business jets pre-owned market inventory


Source: Jetnet and Embraer Analysis, January 2014

Recovery will depend on an improvement in pre-owned prices. Owners are postponing substitutions.

Pre-owned asking prices

25%

30%

35%

40%

45%

50%

2.000

2.200

2.400

2.600

2.800

3.000

3.200

May-09 Jan-10 Sep-10 May-11 Jan-12 Sep-12 May-13 Jan-14

# Total Fleet for sale Market Depreciation


Market Forecast 2014-2023


Market Recovery in slow motion

Lack of confidence is holding the bizjet market turnaround

USA market dictates the speed of recovery

MILD GROWTH US Corporate profits at record levels

HNWI at record levels

World GDP growth is moderate

Used market inventory leveled off but prices are still an issue

Traffic recovery on track but slower than expected

European markets still at risk; emerging countries slowing down


Deliveries Forecast (units)

0

200

400

600

800

1000

1200

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

9,250 jets and US$ 250 Bi in the next 10 years

Units US$

2014-2023 market forecast

900 4,2

1780

15,8

1140

17,3

920

17,8

1270

31,1

1670

64,7

1345

82,2

225 17,3

Deliveries Revenues

N10YF

Ultra Large

Ultra Long Range

Large

Supermid

Midsize

Midlight

Light

Entry


2014-2023 market forecast by region

Source: Embraer 2013.

North America 4,530 a/c (49%) US$ 117 Bi (47%)

EMEA 2,330 a/c (25%) US$ 70 Bi (28%)

Asia Pacific 725 a/c (8%) US$ 21 Bi (8%)

Latin America 860 a/c (9%) US$ 15 Bi (6%)

China 805 a/c (9%) US$ 29 Bi (11%)

Worldwide 9,250 units

US$ 250 Bi


Phenom 300: 170+

Phenom 100: 290+

Lineage 1000: 15+

Legacy 600/650: 210+

700+ executive jets in service in more than 50 countries

Embraer Executive Jets Global Presence

Embraer Day BR 2014 Executive Jets

Business

Transcript of Embraer Day BR 2014 Executive Jets