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Registration Document 2010 RRRegistrationRegistration Document CONTENTS MESSAGE FROM THE CHAIRMEN 1 PRESENTATION OF THE GROUP AND ITS ENVIRONMENT 1.1 Key Figures 1.2 Presentation of the LATECOERE Group 1.3 The Group's Businesses 1.4 Property, Plant and Equipment 1.5 Research & Development 1.6 Sustainable Development 1.7 Degree of Dependence on Patents or Contracts 2 BUSINESSES AND RESULTS 2.1 The Group's Business in 2010 2.2 Business of the Parent Company in 2010 2.3 Business of the Subsidiaries and Other Affiliates in 2010 2.4 Research & Development Expenses 2.5 Human Resources 2.6 Information on Trends 2.7 Other Information 3 CONSOLIDATED FINANCIAL STATEMENTS 3.1 Consolidated Statement of financial position 3.2 Consolidated Income Statement 3.3 Consolidated Statement of comprehensive income 3.4 Consolidated Statement of Cash-Flows 3.5 Consolidated Statement of changes in equity 3.6 Notes to the Consolidated Financial Statements 3.7 Statutory Auditors’ report on the Consolidated Financial Statements REGISTRATION DOCUMENT 2010 LATECOERE 2 4 STATUTORY FINANCIAL STATEMENTS OF THE LATECOERE S.A. COMPANY 4.1 Balance Sheet of the LATECOERE S.A. Company 4.2 Income Statement of the LATECOERE S.A Company 4.3 Statement of Cash Flows of the LATECOERE S.A. Company 4.4 Notes to the Statutory Financial Statements 4.5 Report of the Statutory Auditors on the Annual Financial Statements 4.6 Auditors' Special Report on Regulatory Agreements and Commitments 5 RISK FACTORS 5.1 Business Risks 5.2 Financial Risks 5.3 Other Risks 6 GOVERNANCE AND INTERNAL CONTROL 6.1 The Management Board 6.2 The Supervisory Board 6.3 Report of the Chairman of the Supervisory Board on Corporate Governance and Internal Control 6.4 Statutory Auditor's Report on the Report of the Chairman of the Supervisory Board 7 INFORMATION ON THE COMPANY, CAPITAL AND SHAREHOLDERS 7.1 Information about the Issuer 7.2 Information about Capital 7.3 Information about Shareholders 7.4 Stock Market Data 7.5 Information Policy 8 PERSONS RESPONSIBLE AND STATUTORY AUDITORS 8.1 Person Responsible for the Document 8.2 Statement of the Persons Responsible for the Registration Document 8.3 Statutory Auditors 8.4 Fees Paid to the Statutory Auditors 8.5 Appointment and Renewal of Positions REGISTRATION DOCUMENT 2010 LATECOERE 3 9 HISTORICAL INFORMATION 10 ADDITIONAL INFORMATION 10.1 Additional Information on Trends 10.2 Additional Information on the Potential Dilutive Effect in the Capital of the Latécoère Company 10.3 Additional Information on the Financial Data for LATelec 10.4 Other Information 10.5 Documents Accessible to the Public 10.6 Publication of the Annual Information 10.7 Table of Concordance of the Registration Document Visa of the French Financial Markets Authority (AMF) This document is an unofficial translation of the French "document de référence" (Registration Document) which was filed with the French Financial Markets Authority (AMF) on June 30, 2011 under registration number R.11-044, in accordance with the AMF's General Regulation, and in particular its Article 212-13. This unofficial translation has been prepared by Latécoère for informational purposes only and has not been reviewed or registered with the AMF. The French "document de référence" may be used for purposes of a financial transaction if supplemented with an offering memorandum ("note d'opération") which has received a visa from the AMF. The French "document de référence" was prepared by the issuer and its signatories are responsible for its content. In the event of any ambiguity or discrepancy between this unofficial translation and the French "document de référence", the French version shall prevail. Registration pursuant to Article L. 621-8-1-I of the French Monetary and Financial Code (Code monétaire et financier), was carried out after the AMF verified "if the document is complete and comprehensible, and if the information which it contains is consistent" . This doesn't involve the AMF's authentification of the accounting and financial items presented. Copies of the French "document de référence" are available without cost at the registered office of the Latécoère S.A. Company, 135, rue de Périole, 31500 Toulouse, France. The French "document de référence" may also be consulted on the web site of the Financial Markets Authority (AMF) ( www.amf-france.org ) and on Latécoère S.A.'s web site ( www.latecoere.fr ). REGISTRATION DOCUMENT 2010 LATECOERE 4 Message from the Chairmen Pierre Gadonneix , Chairman of the Supervisory Board François Bertrand, C.E.O. 2010: Growth and Profitability Have Been Restored After a difficult period, in the midst of a crisis in the Aeronautics sector, Latécoère’s 2010 results illustrate the quality and the strength of the proactive adaptation plan that the Group set in place in 2009. Latécoère truly turned things around in 2010, demonstrating the resilience of its businesses and its ability to bolster its unique competitive position. After declining in the first quarter, the Group confirmed an upward revenue trend and posted three consecutive quarters of increases: total annual revenue grew 3.3% year-on-year to €464.4 million, even quarters of increases: total annual revenue grew 3.3% year-on-year to €464.4 million, even better than initially planned. At the same time, Latécoère continued the extensive transformation it began in 2009 to lower its fixed cost base, improve its organization, reduce its manufacturing cycles and adapt its structure to a durable low dollar exchange rate. These drastic measures began to impact the current operating margin, which was multiplied by 2.7 to 5.9% of total revenue. We also closed our contract dispute with Dassault Aviation over a business aircraft contract, and, in early 2011, we signed an agreement with Boeing regarding certain claims associated with the development and production of the doors for the B-787, which confirms Latécoère as the supplier of passenger doors for this program. Our financial situation was strengthened by the conclusion of an agreement with our banking partners that secures the Group’s liquidity, strengthening its balance sheet structure through a partial conversion of debt into convertible bonds and extending the horizon of the hedging of our currency risk on the U.S. dollar. This agreement was very broadly approved by our shareholders, and represents an important first step of financial restructuring of the Group to enable it to continue its development with greater confidence. Accordingly, the Group’s consolidated net debt went down €8 million year-on- year to €351 million as of December 31, 2010. All year long, the good performances we achieved in 2010 were driven by the involvement and commitment of our employees, the support of our shareholders and the trust of our customers, for which we would like to thank them all. Our Group now has a strong order book, with €2.3 billion representing nearly five years of revenues. This illustrates the relevance of the strategy undertaken by the Group, now positioned in all of the major commercial, regional and business aircraft programs. We anticipate profitable growth in 2011 benefiting from the combined effect of an upward cycle coupled with nonrecurring billing of development costs, and the results of productivity measures carried out over the past two years. Latécoère is now stronger than before the crisis, and has confirmed the many strengths developed over the years by the women and men who make up the Group. These strengths reflect the Group’s technical expertise and the competitiveness of its products, and are widely recognized within the aerospace industry. In an economy marked by an upward trend in the aeronautics sector, and as part of our business development strategy, we are confident that the Latécoère Group will play an active role in the consolidation currently underway in the industry. REGISTRATION DOCUMENT 2010 LATECOERE 5 1 PRESENTATION OF THE GROUP AND ITS ENVIRONMENT December 31, 2010 1 PRESENTATION OF THE GROUP AND ITS ENVIRONMENT 1.1 Key Figures The key figures presented were taken from the IFRS financial statements published in respect of the years 2008, 2009 and 2010, and established in compliance with the IFRS system of reference as published by the IASB and adopted by the European Union. Summary Income Statement In millions of euros 2010 2009 2008 Revenue excluding non-recurring items 464,4 449,5 579,5 Aerostructures non-recurring items* - - 104,4 Revenue 464,4 449,5 683,9 Current operating result 27,5 10,1 31,9 Non-current operating result ** 17,8 -112,9 EBIT 45,3 -102,8 31,9 Net financial result -18,3 -3,7 -41,9 ► of which realized gains and losses -10,9 -21,3 -35,4 ► of which unrealized gains and losses** -7,3 17,6 -6,5 Net income (loss) after minority interests 29,9 -91,2 -6,7 * Invocing in 2008 of development work (€ 104.4 million) ** non-cash items : concern provisions and unrealized potential financial gains or losses not having an impact on cash flow for the relevant year The Latécoère Group discloses an aggregate to clarify its operational business: "current operating result". Current operating result reflects operating result excluding significant extraordinary items (expenses or income), whose nature is unrelated to the Group's recurring operation and whose value is not predictive. Furthermore, unrealized financial result reflects unrealized potential financial gains or losses not having an impact on cash flow for the relevant year; it is primarily the foreign exchange rate reappraisal of assets and liabilities and the change in fair value of financial instruments
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