Jack J. Pelton -...

Jack J. PeltonChairman, President & Chief Executive Officer

Cessna Aircraft Company27 September 2007

1

Forward-Looking Information

Certain statements in today’s discussion will be forward-looking statements, including those that discuss strategies, goals, outlook or other non-historical matters; or project revenues, income, returns or other financial measures. These forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update or revise any forward-looking statements.

These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materiallyfrom those contained in the statements, including the risks and uncertainties set forth under our full disclosure located at theend of this presentation.

2

Mission

• To be the premier supplier of aircraft and related services for business, personal, utility and flight training

• To be a model organization within the communities we serve in terms of quality, profitability, corporate responsibility, people and product development

• Cessna means value, dependability and an exceptional customer experience - across design, sales, production, delivery and service - around the world

Taking Care of Customers Is Taking Care of Business

3

CaravanSingle EngineCitations 5%

15%

3%

Used Aircraft

Parts, Service& Other

4%6% CitationShares

67%

Cessna Aircraft2007E Revenues: $4.9 Billion, Up ~18% YOY

4

Business Strategies

• Develop and deliver customer-focused products

• Provide superior aftermarket services

• Strengthen fractional jet ownership business

• Drive operational readiness, reduce costs and improve productivity – Create a Lean Enterprise

• Foster an environment that attracts, develops and retains high performing talent

A Global Leader in General Aviation

5

$326K $448K$220K

$1.8M

Cessna Aircraft Product RangeStep-up Strategy / Strong Brand Loyalty

65-75% of Citation

Sales Are Repeat

Purchases

Caravan

Mustang

CJ1+

CJ2+

CJ3

CJ4

Encore+

XLS+

Sovereign

206

172

Cessna Pilot CentersFoundation for Bringing Customers into the Cessna Family

Cessna Pilot CentersFoundation for Bringing Customers into the Cessna Family

182

162

$20.1M$16.2M$11.6M$8.1M$8.0M$7.1M$6.1M$4.6M$2.5M

Citation X

$110K

6

Cessna Industry Leadership

Percentage Jets Shipped Light and Midsize,2001 – 2006

Source: GAMA and Cessna estimates

Gulfstream6%

Hawker Beechcraft

23%

Bombardier17%

Dassault2%

Cessna52%

• Customer-focused new product development

• Continuous improvement in quality, reliability, service and support

• Proven value propositions

• Brand strength supported by the largest, loyal customer base in general aviation

7

0

5

10

15

20

25

30

Ecl

ipse

50

0Business Jet Competitive Landscape

Pri

ce $

Millio

ns

CJ1

+

CJ2

+

Pre

mie

r 1

A

CJ4

*

CJ3

Lear

40

XR

H-4

00

XP

En

core

+

Lear

45

XR

Haw

ker

75

0*

So

vere

ign

Ch

all

en

ger

30

0

Cit

ati

on

X

G2

00

Lear

60

XR

Haw

ker

40

00

Cessna Is Well-positioned for Continued Leadership

* In development

Haw

ker

90

0X

P

Leg

acy

60

0

Ph

en

om

30

0 *

Ph

en

om

10

0 *

Source: B&CA and company press releases

HondaDiamond

PiperAdamGrob

Sino-Swearingen

HondaDiamond

PiperAdamGrob

Sino-Swearingen

Mu

stan

g

G1

50

XLS

(+*

)EmbraerGulfstreamBombardierHawker

BeechcraftCessnaEclipse

8

Business JetsA Growth Industry

0

200

400

600

800

1,000

1,200

1,400

1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 20080

200

400

600

800

1,000

1,200

1,400Real Corporate Profits (8 Q Shift)

Jet Shipments

5%

10%

15%

20%

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

19%

35% 35%

41%

48% 47%

0%

10%

20%

30%

40%

50%

2002 2003 2004 2005 2006 2007F

Corporate Profits International Citation Orders

Used Citations as % of FleetKey Drivers•Economic expansion

–Longer cycles with less severe troughs

•New model introductions

–Entry-level jets

•Global expansion, especially Europe

•Replacement cycle opportunities

•Commercial airline environment

Source: Global Insight, JetNet, Amstat, Cessna estimates

9

Citation Order Environment

181

247

307

470

380

0

100

200

300

400

500

2004 2005 2006 2007F 2008F

Deliveries

Mustang

Other Citations

• Booked 525 orders through August (versus 496 total in 2006)

• Sold-out 2007 and 2008

• International order mix growing, led by Europe

• $10.8B Citation backlog (excludes $0.4B CitationShares)

Global Order Activity Remains Strong

10

New Products Drive Growth2004 - 2010

Citation CJ3$7.1M

Backlog: ~$1.1B1st Delivery: ‘04

Citation CJ2+$6.1M

Backlog: ~$600M1st Delivery: ‘06

Citation CJ1+$4.6M


Citation Mustang$2.5M


Citation XLS/XLS+$11.6M

Backlog: ~$2.8B1st Delivery: ‘04/‘08

Citation Sovereign$16.2M



Citation Encore+$8.1M

Note: August 2007 backlogs exclude CitationShares

Citation CJ4$8.0M


11

Citation Mustang• First fully-certified jet in segment

• Approved for steep approach

• Steps-up piston-twin and turboprop owners with a high-level of brand loyalty

• First EASA delivery – September 2007

• Established world-class customer support network

Attractive Entry to the Citation Family,Expanding the Addressable Market

$2.52 millionFAA Cert: 2006EASA Cert: May 2007’07E Deliveries: 44

12

Citation CJ4

• Fully integrated Collins Pro Line 21 avionics

• Advanced diagnostic systems

• New standard integrated cabin management system

• Newly engineered, moderately swept wing

• Flying the new Williams FJ44-4A electronically-controlled engines

Upward Extension to the Single-pilot Certified Citation Family

$7.995 millionFirst Flight: 1H08FAA Cert: 2H09EASA Cert: 2H10Deliveries: 1H10

13

Cessna 162 SkyCatcherLight Sport Aircraft (LSA)

• Reverse declining general aviation trends

• Stimulate emerging international segments

• Maximize future step-up opportunities

• Launched July 24 at Oshkosh with 800+ orders

• Features include

– $109,500 introductory price

– Exclusive glass cockpit(Garmin G300)

– Teledyne ContinentalO-200D, 100hp engine

Exciting New Propeller Aircraft Entry

14

Large Cabin Concept

Finalizing Business Case for Larger Citation – 2008 Decision

• Successful domestic and European mockup tour

• Research continues to confirm a significant loyal Citation customer base to support large cabin family

• All specifications on proof-of-concept mockup subject to change– Nine passengers and two pilots

– Flat floor with refreshment area and walk-in baggage compartment

– 4,000 nm range at 459 ktas (NBAA IFR)

– Full fuel payload of 1,950 lbs

– Max speed of 488 ktas

– 82” interior cabin width

– Avionics and engine remain unspecified

15

Customer Support

Parts

• Supplier management

• Increase global parts availability

• Improve AOG response

Service

• Selective expansion of US and international capacity and capability

New Products

• Advanced diagnostics

• Chief of Maintenance

• MSG-3

Managing Growth• Talent

• Field service engineers

• Model teams

• 24x7 support

• CESCOM enhancements

Delivering Exceptional Customer Supportby Strengthening Global Capability

16

Integrated Supply ChainLean Enterprise - Building Quality and Managing Growth

• Standard procedures and mistake-proofing drive and maintain first-time quality

• Enables flow through variation reduction

• 14% improved Independence productivity (2003-2007)

• Continued design improvement

– Manufacturability

– Serviceability

– Reliability

• Globalization

– Textron Aerospace de Mexico

– LSA sourcing in low-cost region

Leverage Textron Production System, Drive Operational Excellence

17

Business Jet IndustryDevelopment Criteria - The “4As”

• Affluence– Economic development

– Business and personal wealth distribution

• Airports / air traffic control– Infrastructure and support

• Airspace access– Political climate and regulatory environment

• Affordability / acceptance– Alternatives and relative cost of operations

Several Key Factors Affect the Pace of Development

18

Cessna Global Network

Authorized Sales Reps

Cessna Citation Service Centers

Field Service Engineers

Authorized Citation Service Centers

Cessna Manufacturing

Textron Global Resources

Systematically Building Global Network to Grow our Business

19

Europe

Affordability / acceptance

Airspace access

Airports / air traffic control

Affluence • Robust economic growth generating wealth

• Weak dollar continues to support sales

• Jets gaining acceptance as business tools

• Infrastructure progressing

• Increasing demand from Russia and Eastern Europe

Current State

Source: Cessna analysis

Overview

20

China and India

Source: Cessna analysis

Summary• Potential for long-term growth with

improved regulations and infrastructure

• Cessna creating a solid foundation for the future, tapping local capabilities and building industry leadership

Current State

India• Significant pilot shortage

• ~25% tax on non-airline aircraft imports began 4/07

• Infrastructure under strain

• Growing individual and corporate wealth

• Aircraft being accepted as business tools

• Cessna leads industry in units

China• Significant pilot shortage

• ~21% tax on foreign business jets

• First Citation delivered in 1982, followed by 10 Citations over the next 20 years

• In the last 2 years, Citation fleet doubled with 8 new and 3 used

• 120+ new Cessna single-engine pistons will enter flight training by end of 2007


Airspace access


Affluence


Airspace access


Affluence

21

Global GrowthSummary

• Business aviation shaped in US (~70% fleet)

• International demand growing, yet fragmented

– Europe primary driver

– Emerging countries (e.g., India, China) will slowly develop

• Strategy focused on customers

– Create and capture demand

– Support growing fleet

• Leveraging global resources (talent, capacity, cost), while minimizing risk and avoiding dilution

Cessna Capitalizing on Global Growth

22

Business Performance

33%

49% 50%

15%

25%

35%

45%

55%

2005 2006 2007E

249

380

307

150

200

250

300

350

400

2005 2006 2007E

Units

16.25%15.5%

13.1%

5%

10%

15%

20%

2005 2006 2007E

Margin ROIC

RevenuesCitation Deliveries

3.5

4.9

4.2

2

3

4

5

2005 2006 2007E

$B

23

Summary• Industry outlook remains positive

• Growing international order mix

• Continued investment in customer-focused products

– Mustang expands addressable market

• Excellent service and support capability

• Effectively managing growth and driving operational excellence

80 Years: One Sure Thing®

24

Forward Looking InformationForward-looking Information: Certain statements in this report and other oral and written statements made by Textron from time to time are forward-looking statements, including those that discuss strategies, goals, outlook or other non-historical matters; or project revenues, income, returns or other financial measures. These forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update or revise any forward-looking statements. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in the statements, including the following: [a] changes in worldwide economic and political conditions that impact demand for our products, interest rates and foreign exchange rates; [b] the interruption of production at Textron facilities or Textron’s customers or suppliers; [c] Textron's ability to perform as anticipated and to control costs under contracts with the U.S. Government; [d] the U.S. Government's ability to unilaterally modify or terminate its contracts with Textron for the Government's convenience or for Textron's failure to perform, to change applicable procurement and accounting policies, and, under certain circumstances, to suspend or debar Textron as a contractor eligible to receive future contract awards; [e] changes in national or international funding priorities and government policies on the export and import of military and commercial products; [f] the ability to control costs and successful implementation of various cost reduction programs; [g] the timing of new product launches and certifications of new aircraft products; [h] the occurrence of slowdowns or downturns in customer markets in which Textron products are sold or supplied or where Textron Financial offers financing; [i] changes in aircraft delivery schedules or cancellation of orders; [j] the impact of changes in tax legislation; [k] the extent to which Textron is able to pass raw material price increases through to customers or offset such price increases by reducing other costs; [l] Textron’s ability to offset, through cost reductions, pricing pressure brought by original equipment manufacturer customers; [m] Textron's ability to realize full value of receivables; [n] the availability and cost of insurance; [o] increases in pension expenses and other post-retirement employee costs; [p] Textron Financial’s ability to maintain portfolio credit quality; [q] Textron Financial’s access to debt financing at competitive rates; [r] uncertainty in estimating contingent liabilities and establishing reserves to address such contingencies; [s] performance of acquisitions; [t] the efficacy of research and development investments to develop new products; [u] the launching of significant new products or programs which could result in unanticipated expenses; and [v] bankruptcy or other financial problems at major suppliers or customers that could cause disruptions in Textron’s supply chain or difficulty in collecting amounts owed by such customers.

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