THALES UK

www.thalesgroup.com/uk

Despite some challenging market conditions, we are fortunate that our long and respected track record for delivery, places us in an excellent position.

VICTOR CHAVEZ
CHIEF EXECUTIVE

Thales is a modern, agile organisation with a proven history of forming effective and sustainable partnerships with customers across all areas of industry, commerce and government. We work closely with our customers in a transparent and open manner to deliver systems and services that make a real difference on time and to budget.

Thales has a broad por tfolio of technologies, systems and services which play a key role in ensuring the national security of the UK. In addition to our traditional markets of defence and aerospace, we are particularly focused on playing a leading role in the increasingly impor tant areas of cyber-security and counter-terrorism. We continue to develop our position as a leading par tner to the UK Ministry of Defence (MoD), shown by our delivery of high-quality urgent operational requirements (UORs) to protect soldiers, sailors and airmen in areas of military operations. On our major equipment programmes, we are making significant progress on the Queen Elizabeth (QE)-class aircraft carriers and the Watchkeeper unmanned air system (UAS). The QE-class ships will be the most capable and powerful warships ever constructed in the UK and Watchkeeper is the largest programme of its kind in Europe. All our activities are backed by innovative and cost-effective ser vice provision and through-life support.

In transpor tation there are exciting oppor tunities for us to build on our relationship with existing customers, including Transport for London, supporting its modernisation of the London Underground and other urban transport networks, and Network Rail with its challenging signalling and telecoms modernisation programmes. The M-PactThales consortium is continuing to design, build and maintain Manchester Metrolinks new light railway, largest single public transport investment outside London. Thales UK has a healthy backlog of orders and we have a strong pedigree of successful expor ts to many countries. Our robust performance in international markets means that expor ts currently account for 25% of our revenues, a figure we are focussed on increasing. In particular we have a strong track record of exports in the optronics, sonar, electronic warfare, aerospace and missile sectors.

Thales UK makes the world a safer and more secure place by combining technological, engineering and operational excellence with commercial innovation. We want our customers to prefer to work with us because we act with integrity, respect the need to develop long-term productive relationships, and always deliver on our promises

Despite some A global company challenging market conditions, we are fortunate that with 68,000our long and respected track record employees in infor delivery, places us an excellent position. 50 countries and 11.2 billion in revenues

Thales is a modern, agile organisation that makes a substantial contribution to the UK economy. We have a proven history of forming effective and sustainable partnerships with customers across all areas of industry, commerce and government. We enjoy the trust of our customers because of our expertise in complex systems integration, because we are transparent in our dealings with them, and because we are committed to delivering much-needed capabilities on time and to budget backed by service provision and through-life support. Our focus on the delivery of products and continuous service improvement has been rewarded with exceptional performance, achieving double-digit growth in the UK over the past few years. We continue to develop our position as a leading partner to the UK Ministry of Defence Australia (MoD), shown by our extraordinary efforts to deliver high-quality Urgent Operational Requirements (UoRs) to protect soldiers, sailors Austria and airmen in Iraq and Afghanistan. Weve Belgium also made progress on significant equipment programmes, including the Queen Elizabeth-class Brazil aircraft carriers and the Watchkeeper unmanned air system (UAS). Canada In transportation there are exciting opportunities China for us to build our relationship with existing customers, including Transport for London, France supporting their efforts to modernise the London Underground and other urban transport Germany networks. Progress of the M-Pact Thales India consortium in the design, build and maintenance of Manchester Metrolinks new light railway lines Italy has grown our UK presence in this market.

A global leader

Mexico Thales UK has a healthy backlog of orders and we have a strong pedigree of successful exports to many countries: our robust performanceNetherlands in international markets means that exports currently account for 25% of revenues at Thales Norway UK. So, for example, in the civil market we Portugal continue to have a strong presence in the global full-flight simulator market; in the military marketRomania our avionics, optronics, sonar and electronic warfare equipment regularly compete in the Saudi Arabia global market.
We are grateful for the strong support of the British Government and are encouraged that the Government has signalled a desire to boost British export success, not least in the UKs South high-tech manufacturing sector.

Thales is a world leader in mission-critical information systems for defence and security, aerospace and transportation.

Singapore Spain Africa South Korea Switzerland United Arab Emirates United Kingdom United States
Countries listed with 100 employees or more

In 2010 the company generated revenues of 11.2 billion (13.1 billion) and had an order book of 21.8 billion (25.4 billion). Building on its exper tise in the most sophisticated technologies and large-scale software systems, Thales is stepping up to the security challenges of its customers in an increasingly complex world. With its global network of 22,500 engineers and researchers, Thales has earned particular recognition for its ability to develop and deploy dual-use civil and military technologies. Leveraging its international operations and spanning the entire value chain from equipment to systems and services, Thales is playing a pivotal role in making the world a safer and more secure place.

Innovation
To provide customers with high-tech solutions and ser vices that meet their future requirements, Thales needs to innovate constantly. The purpose of all our innovations is to create value for customers, sometimes by using technology but also by finding new ways of doing business or organising ourselves, better ways to manage our processes and combine our talents. The effectiveness of Thaless research and development (R&D) effort hinges largely on the decentralised nature of our operations, with centralised coordination around strategic priorities. R&D teams are based in all the companys main countries of operation.

Growth
Thales, as par t of its growth strategy, intends to further expand local industrial operations in Asia, Latin America and the Middle East. This is to meet the demands of local customers (mainly governments) who want their countries to benefit directly from the skills and technologies that a company like Thales can provide. Thales also plays a leading role on some of Europes largest programmes, in areas as varied as equipment and systems for land forces, aerospace, naval defence, security, satellites, missile systems and C4I. This strengthens Thaless positions in these domestic markets. In civil aviation, space and ground transportation, Thales is a major player on some of todays largest strategic projects, including air traffic management, satellites and transportation.

Performance
Only high-tech businesses that continuously improve their operational performance, simplify their processes and optimise the way they manage projects and risks will have the capacity they need to develop state-of-the-art solutions for their customers. Setting best-in-class standards, sharing best practices and learning how to work even more cohesively as a team these are the objectives of the 2010 2014 performance plan and our new business process baseline. This comprehensive set of measures is continuously improving our efficiency and programme delivery performance.

Despite some challenging market conditions, we are fortunate that our long and respected track record for delivery, places us in an excellent position.

Thales is a modern, agile organisation that makes a substantial contribution to the UK economy. We have a proven history of forming effective and sustainable partnerships with customers across all areas of industry, commerce and government. We enjoy the trust of our customers because of our expertise in complex systems integration, because we are transparent in our dealings with them, and because we are committed to delivering much-needed capabilities on time and to budget backed by service provision and through-life support.

8,000 people across 35 locations Our focus on the delivery of products and continuous service improvement has sites at with key been rewarded with exceptional performance, achieving
double-digit growth in the UK over the past few years. We continue Basingstoke to develop our position as Glasgow a leading partner to the UK Ministry of Defence (MoD), shown by our extraordinary efforts Belfast Leicester to deliver high-quality Urgent Operational Bristol London Requirements (UoRs) to protect soldiers, sailors and airmen in Iraq and Afghanistan. Weve Cambridge Manchester also made progress on significant equipment programmes, including the Queen Elizabeth-class Crawley Reading aircraft carriers and the Watchkeeper unmanned Doncaster Templecombe air system (UAS).

Investing in the UK
Thales has invested heavily in the UK in the last 10 years in people, sites and technology, showing our commitment to our UK and overseas customers, to our staff and to growth opportunities.

Weybridge In transportation there are exciting opportunities for us to build our relationship with existing customers, including Transport for London, supporting their efforts to modernise the London Underground and other urban transport networks. Progress of the M-Pact Thales consortium in the design, build and maintenance of Manchester Metrolinks new light railway lines has grown our UK presence in this market.
Thales UK has a healthy backlog of orders and we have a strong pedigree of successful exports to many countries: our robust performance in international markets means that exports currently account for 25% of revenues at Thales UK. So, for example, in the civil market we continue to have a strong presence in the global full-flight simulator market; in the military market our avionics, optronics, sonar and electronic warfare equipment regularly compete in the global market. We are grateful for the strong support of the British Government and are encouraged that the Government has signalled a desire to boost British export success, not least in the UKs high-tech manufacturing sector.

Thales is a significant defence and aerospace company and this sector is a par ticularly good example of the UKs expertise in high-tech manufacturing as it represents more than 10% of the UKs entire manufacturing industry. We employ around 4,000 engineers and technicians, 90% of which are qualified to degree level or above. These people are employed in high-value, high-quality manufacturing activity, or on R&D work for future business. Thales is a key investor in UK Intellectual Proper ty and at our Readingbased research facility we employ around 80 engineers, mathematicians and scientists that collaborate with various government agencies, universities and private organisations. As a global business we devote almost 20% of our revenue to R&D, and each year we file hundreds of patents. We deliver our programmes through an extensive supply chain, with 70% of our turnover passing to our suppliers. In total Thales UK works with over 3,500 suppliers, employing an estimated 24,000 people in our supply chain. Our new high-tech facility in Crawley, which brings together over 2,500 of our staff, is the biggest of Thaless recent investments, part of a wider programme across the UK that also includes investment at our Basingstoke and Templecombe sites. We currently have more than 350 graduates on our four-year Graduate Development Programme working across Thales UK. We see this as an essential element in maintaining a professional workforce in a competitive world market. We also have around 60 apprentices, that add value to all aspects of our business and are a vital par t of the companys planning for the future.

Responsibility in action
We see Corporate Responsibility (CR) as a serious investment in our future and it is deeply embedded in the Thales culture. It is a formal, publicly declared strategy with performance regularly measured against industry standards. We aim to attract and retain the best people we can and help them to develop personally and professionally in an environment that nurtures their safety and well being. We aspire to be an employer of choice. We understand the impor tance of contributing to the local and wider communities through charitable giving, sponsorship and education. We actively encourage and support employee fundraising and volunteering. We believe in protecting the environment for future generations. Supported by the Carbon Trust, we are committed to sustainable development, reducing our carbon footprint, energy consumption and waste. We act with integrity in all of our business dealings and insist on high ethical standards. We follow a strict Group-wide code of ethics that governs our behaviour as a business and as individuals. We deliver on our commitments to our customers, suppliers and partners, and we abide by all export and other regulations.

Business areas

We serve four sectors that are right at the heart of todays complex, interconnected world by embedding all our services, solutions and equipment with sophisticated technologies that help decision makers deliver a better outcome.

Defence
Thales UK is a major defence prime contractor and systems integrator, with a deep technological understanding, a strong electronic systems integration track record and the capability to suppor t systems through life on a global basis including in operational theatres. From electronic warfare and sensor systems, such as the sonar system on the new Astute-class submarine, to precision-guided missile systems, such as Starstreak few companies can match our ability to offer proven solutions to protect soldiers, sailors and airmen in the defence of national interests. Thales UK provides equipment or sensors to almost every major platform in service or in development for the UK armed forces. In par ticular we have exper tise in intelligence, sur veillance, target acquisition and reconnaissance (ISTAR). Our extensive capability provides an excellent portfolio of systems, products and services for the export market.

Aerospace
Thales UK provides a wide range of proven equipment and systems for fixed and rotary wing platforms. Leaders in the provision of sophisticated onboard systems and training on our full-flight simulators, our customers include some of the latest airlines and aircraft manufactures: the A400M, the A350, the Sukhoi Superjet 100 and the B787. In fact 80% of the worlds pilots have been trained on Thaless synthetic training devices. We are also a world leader in air traffic management services, with many UK examples. Linked to our US inflight entertainment systems, our UK business provides a range of high-capacity satellite communications systems that enable passengers to use mobile phones and the internet aboard civil aircraft.

Transport
Transport networks around the world rely on technology and systems expertise from Thales for safety, reliability and optimised capacity. Our main markets in the UK are urban rail, mainline rail and roads, where our solutions include signalling (train control, axle counters, interlockings, train protection and warning systems), super vision and control, integrated communications, security and information management. Our clients include the Highways Agency, Transport for London, Network Rail, Transpor t for Greater Manchester and various train operating companies. With a current order book worth around 800 million and a strong order pipeline, our portfolio of products and solutions backed by a full range of design, installation and support services is second to none.

Security
Thales UK is an established expert in the design and supply of critical systems for promoting the safety and security of people, places and sensitive information. We are working closely with our customers to define the future needs of homeland security and the protection of critical national infrastructure using technologies such as secure communication systems, encryption technology, command and control systems and chemical, biological, radiological and nuclear solutions. With 40 years of expertise and over 400 cyber and security specialists, Thales has unrivalled experience across the cyber spectrum, working for civil and military customers. For example, our proven exper tise in secure network communications safeguards 3.7 billion BACS transactions wor th around 1 trillion every year.

Despite some challenging market conditions, we are fortunate that our long and respected track record for delivery, places us in an excellent position.

Thales is a modern, agile organisation that makes business culture, the UK UK is a substantial contribution toThales economy. We have a proven history of forming effective and recognised by our customers as sustainable partnerships with customers acrossa all areas of industry, commerce and government. Wetrusted trust of our for prime contracting, enjoy the partner customers because of our expertise in complex systems integration, systems integration and through-life because we are transparent in our dealings with them, and because we are committed to service provision. delivering much-needed capabilities on time and to budget backed by service provision and through-life support. Our focus on the delivery of products and continuous service improvement has been rewarded with exceptional performance, achieving double-digit growth in the UK over the past few years. We continue to develop our position as a leading partner to the UK Ministry of Defence (MoD), shown by our extraordinary efforts to deliver high-quality Urgent Operational Requirements (UoRs) to protect soldiers, sailors and airmen in Iraq and Afghanistan. Weve also made progress on significant equipment programmes, including the Queen Elizabeth-class aircraft carriers and the Watchkeeper unmanned air system (UAS). In transportation there are exciting opportunities for us to build our relationship with existing customers, including Transport for London, supporting their efforts to modernise the London Underground and other urban transport networks. Progress of the M-Pact Thales consortium in the design, build and maintenance of Manchester Metrolinks new light railway lines has grown our UK presence in this market. Thales UK has a healthy backlog of orders and we have a strong pedigree of successful exports to many countries: our robust performance in international markets means that exports currently account for 25% of revenues at Thales UK. So, for example, in the civil market we continue to have a strong presence in the global full-flight simulator market; in the military market our avionics, optronics, sonar and electronic warfare equipment regularly compete in the global market. We are grateful for the strong support of the British Government and are encouraged that the Government has signalled a desire to boost British export success, not least in the UKs high-tech manufacturing sector.

With our proactive and transparent

Major programmes and bids

10

Queen Elizabeth-class aircraft carriers

The UKs new aircraft carriers are being constructed by an alliance of industry and the MoD, of which Thales UK is a founding par tner. Thales UK is responsible for leading the platform design, power and propulsion and aviation teams. Thales is also par ticipating in the delivery of the carriers mission systems, including the development and manufacture of the communications element. Thales will also play a full role in supporting the carriers in service.

Overlaying on this network, Thales installed Airwave, a communications system for the emergency services.

Marshall
Team Aquila (formed of Thales UK and NATS) is bidding for Marshall, an MoD project valued at 11.5 billion to provide air traffic management (ATM) systems and services at all MoD-operated airbases and flying ranges in the UK and overseas. The MoDs existing ATM infrastructure faces serious obsolescence issues, requiring replacement to ensure ongoing military air operations. We expect the programme, which will run for 22 years, will be a long-term ser vice-provision programme, of which we have considerable experience. Thales is a world leader in civil and military ATM, with over 50 years experience and contracts in 150 countries.

Watchkeeper unmanned air system (UAS)

Watchkeeper is Europes largest UAS programme, for which Thales UK is prime systems integrator. The programme will contribute significantly to force protection by providing the UK armed forces with remote, unmanned intelligence gathering and processing capabilities and surveillance during military operations. Information and images are provided to a network of mobile ground control stations and remote viewing terminals, providing valuable intelligence for commanders. Thales UK will also provide the suppor t contract for Watchkeeper.

Cipher
We are currently bidding for Cipher, a 750 million+ programme that meets all of the Cabinet Office criteria for a major project. Cipher will address the UK MoDs long term requirements for Security Management Infrastructure, provide their future cryptographic requirements, enable greater communications security, improve operational flexibility and deliver significant savings. Cipher also has utility across other government departments with the MoD as the first adopter. Ciphers encryption infrastructure will enable the secure linking of different government communication networks thus creating a National Information System. This will then allow different government depar tments to communicate or pass classified or sensitive data to each other rapidly and seamlessly. Cipher is an important element of Thales UKs broader agenda in the cyber-security market. Our strong encryption pedigree in both civil and military markets is at the heart of our tender response, along with our ability to provide a complete service through life.

London Underground and urban re-signalling and communications projects

Thales UK is providing new signalling systems for London Undergrounds Jubilee and Nor thern tube lines, the biggest implementation of its kind anywhere in the world. The system, using Thaless globally proven SelTrac technology, will boost reliability and achieve a 33% increase in passenger capacity. Similar technology has been in service on the Docklands Light Railway since 1995. Thales UK is also part of the Connect consortium, a 20-year 1.2 billion PFI, providing communications infrastructure for London Underground.

11

Thales UK
2 Dashwood Lang Road, The Bourne Business Park Addlestone, Nr Weybridge, Surrey KT15 2NX Telephone: +44 (0)1932 824800 e-mail: uk.enquiries@thalesgroup.com

Designed & Produced by Thales UK Corporate Communications 1063/9/11 Copyright Thales UK 2011.