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LMT Investor Conference Orlando 11_07_08 1 Welcome Welcome Lockheed Martin Investor Conference Lockheed Martin Investor Conference Orlando, FL Orlando, FL November 7, 2008 November 7, 2008

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Page 1: Welcome [ ] · PDF fileHellfire ®  6,800+ Missiles Fired. Javelin ™  480+ Launched Symphony ™ ... Revolutionary 2-Pulse Rocket Motor • MEADS Missile Milestones •

LMT Investor Conference Orlando 11_07_08 1

WelcomeWelcomeLockheed Martin Investor ConferenceLockheed Martin Investor Conference

Orlando, FLOrlando, FLNovember 7, 2008November 7, 2008

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LMT Investor Conference Orlando 11_07_08 2

Our presentation contains Our presentation contains ““forwardforward--lookinglooking”” statements or projections based on statements or projections based on current expectations. These statements are not guarantees of fucurrent expectations. These statements are not guarantees of future performance ture performance and are subject to risks and uncertainties. Actual results may and are subject to risks and uncertainties. Actual results may differ materially due to: differ materially due to: the availability of government funding and budgetary constraintsthe availability of government funding and budgetary constraints; changes in ; changes in customer priorities; the impact of economic recovery and stimulucustomer priorities; the impact of economic recovery and stimulus plans and s plans and continued hostilities in Iraq and Afghanistan on funding for defcontinued hostilities in Iraq and Afghanistan on funding for defense programs; ense programs; program and contract performance; return or loss on benefit planprogram and contract performance; return or loss on benefit plan assets, interest and assets, interest and discount rates, and other changes that may impact benefit plan adiscount rates, and other changes that may impact benefit plan assumptions; the ssumptions; the timing and availability of future government awards; the outcometiming and availability of future government awards; the outcome of legal of legal proceedings; the future impact of acquisitions, divestitures or proceedings; the future impact of acquisitions, divestitures or joint ventures; joint ventures; economic, business and regulatory conditions and other factors. economic, business and regulatory conditions and other factors. We disclaim any We disclaim any duty to update forwardduty to update forward--looking statements to reflect new developments.looking statements to reflect new developments.Our SEC filings (found at Our SEC filings (found at www.lockheedmartin.comwww.lockheedmartin.com or at or at www.sec.govwww.sec.gov), including our ), including our 2007 Form 102007 Form 10--K and 2008 Form 10K and 2008 Form 10--Qs, contain more information on the types of risks Qs, contain more information on the types of risks and other factors that could adversely affect these statements.and other factors that could adversely affect these statements.2008 Financial Results are unaudited.2008 Financial Results are unaudited.

Forward Looking Statements

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LMT Investor Conference Orlando 11_07_08 3

Electronic Systems OverviewElectronic Systems Overview Chris KubasikChris KubasikKen PossenriedeKen Possenriede

Missiles & Fire ControlMissiles & Fire ControlAir & Missile DefenseAir & Missile DefenseFire Control & Situational AwarenessFire Control & Situational Awareness

Mike Trotsky Mike Trotsky Tom SimmonsTom Simmons

Maritime Systems & SensorsMaritime Systems & SensorsLittoral Combat ShipLittoral Combat ShipSeaSea--Based Missile DefenseBased Missile Defense

Dan SchultzDan SchultzOrlando CarvalhoOrlando Carvalho

Systems Integration Systems Integration –– OwegoOwegoVHVH--71 Presidential Helicopter71 Presidential HelicopterJoint Light Tactical VehicleJoint Light Tactical Vehicle

Jeff BantleJeff BantleSteve RamseySteve Ramsey

Simulation Training & SupportSimulation Training & Support Doug GreenlawDoug Greenlaw

Agenda

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LMT Investor Conference Orlando 11_07_08 4

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LMT Investor Conference Orlando 11_07_08 1

Chris KubasikExecutive Vice President

Electronic SystemsElectronic Systems OverviewOverview

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LMT Investor Conference Orlando 11_07_08 2

Aeronautics Space Systems

Electronic Systems

Information Systems &

Global Services

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Electronic Systems at a Glance

Maritime Systems& Sensors

Moorestown, NJ

CanadaKanata, Ontario

Maritime Systems& Sensors Manassas, VA

Maritime Systems& SensorsMoorestown, NJ

Missiles and Fire ControlLufkin, TX

Missiles and Fire ControlGrand Prairie, TX

Maritime Systems& SensorsSyracuse, NY

Maritime Systems& SensorsMitchel Field, NY

Missiles and Fire ControlOcala, FL

Systems Integration - OwegoOwego, NY

Missiles and Fire ControlCamden, AR

Missiles and Fire ControlTroy , AL

Missiles and Fire Control Simulation, Training & SupportOrlando, FL

Maritime Systems& SensorsRiviera Beach, FL

Missiles and Fire ControlEl Paso, TX

Maritime Systems& SensorsBaltimore, MD

Simulation, Training & SupportHuntsville, AL

Simulation, Training & SupportWashington, DC

Missiles and Fire Control Archbald, PA

Maritime Systems& SensorsSimulation, Training & SupportAkron, OH

Sandia National LaboratoriesSimulation, Training & SupportAlbuquerque, NM

Maritime Systems & SensorsSimulation, Training & SupportEagan, MN

Maritime Systems& SensorsIrvine, CA

Missiles and Fire Control Chelmsford, MA

Maritime Systems& SensorsMarion, MA

Maritime Systems& SensorsClearwater, FL

Advanced Technology LabsCherry Hill, NJ

CanadaMontreal, Quebec

Sandia National LaboratoriesLivermore, CA

UK Integrated SystemsHavant

LM UK INSYSAmpthill

Atomic WeaponsEstablishmentAldermaston

Maritime Systems& SensorsBothell, WA

Electronic Systems HQBethesda, MD

Maritime Systems& SensorsAdelaide

Sites with more than 100 employees

Simulation, Training& SupportPerthPerth

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LMT Investor Conference Orlando 11_07_08 4

Lockheed MartinElectronic Systems

Missiles & Fire Control

Systems Integration-

Owego

Maritime Systems &

Sensors

Simulation, Training & Support

Energy(Sandia,

AWE)

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LMT Investor Conference Orlando 11_07_08 5

GrowthReputation

InnovationPeople

Electronic Systems Priorities

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LMT Investor Conference Orlando 11_07_08 6

Growth Core Domestic

U.S. Army

U.S. Navy,Marine Corps

U.S. Air Force

DoE, Coast Guard,Civil, Other

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LMT Investor Conference Orlando 11_07_08 7

GrowthInternational

Growing to >30% of Sales

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LMT Investor Conference Orlando 11_07_08 8

Growth Adjacent and White Space

Renewable Energy Education

Critical Infrastructure

ProtectionnHealthcare

Training & Simulation

Port Security,Surveillance,Critical Asset

Protection

Training & Simulation

Solar OTEC

Aligned with National ImperativesAligned with National Imperatives

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LMT Investor Conference Orlando 11_07_08 9

Opportunities• PAC-3

• THAAD UAE

• CSAR-X

• LCS

• Tactical Ground Vehicles

• DDG 51 Continuation

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LMT Investor Conference Orlando 11_07_08 10

Program Performance Favorable Media Coverage

Corporate ResponsibilityIntegrity and Accountability

Solid Reputation a Pillar for Growth

• Satellite Shootdown

• YTD Mission Success at 100%

• Introducing Additional Customer Feedback Mechanisms

JASSM Deepwater

VH-71LCS

Now 89%

Was 33%Was 46%

Now 81%

Was 46%

Now 67%

Was 12%

Now 36%

Reputation

Lockheed Martin “pulled this kick-ass missile out of the fire.” (October 7, 2008)

Secretary Sue Payton

“One of our best programs at Eglin.”Maj. Gen. David Eidsaune

• 220,000 Volunteer Hours

• Focus on STEM Education, Mentoring

• $6.6M in Employee, Company Contributions

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LMT Investor Conference Orlando 11_07_08 11

• $250M in 2008 IRAD• CRAD Exceeds IRAD• Nanotechnology Partnership with

Rice University

DDG-51

Innovation as an Enabler

Unmanned Vehicles

Energy

• Utility-Scale Solar• Ocean-Thermal Energy

Conversion• Portable Power

• Aegis Modernization Under Way• Open Architecture Implementation• FY09 Appropriation for

DDG-51 Continuation

Innovation

K-MAX

RemoteMinehunting

System

Squad MissionSupport System

Technology

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LMT Investor Conference Orlando 11_07_08 12

PeopleChristopher E. KubasikExecutive Vice President

Fred P. MoosallyMaritime Systems

& Sensors

James F. Berry Missiles & Fire

Control

Marillyn A. HewsonSystems Integration -

Owego

Dale P. BennettSimulation, Training

& Support

Kenneth R. PossenriedeVP, Finance &

Business Operations

Joseph A. PetroneVP, Human Resources

Yvonne O. HodgeCIO & VP, Quality

& Mission Success

Peter A. Harrigan VP, Communications

Stephen M. Piper VP, General Counsel

Srinivas DixitDirector, Ethics and Business Conduct

Russ E. FrewVP, Technology

Patrick M. DewarVP, Business Development

Thomas O. HunterSandia National

Laboratories

Michael O. GordonVP, Operations and

Supply Chain Management

CompanyPresidents

FunctionalStaff

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LMT Investor Conference Orlando 11_07_08 13

Today’s Presentations Missiles and Fire Missiles and Fire

ControlControlMaritime Systems & Maritime Systems &

SensorsSensorsSystems IntegrationSystems Integration--

OwegoOwegoSimulation, Training Simulation, Training

& Support& Support

Air & Missile DefenseAir & Missile DefenseMike TrotskyMike Trotsky

SensorsSensorsTom SimmonsTom Simmons

Littoral Combat ShipLittoral Combat ShipDan SchultzDan Schultz

SeaSea--Based Missile DefenseBased Missile DefenseOrlando CarvalhoOrlando Carvalho

VHVH--7171Jeff BantleJeff Bantle

Joint Light Tactical VehicleJoint Light Tactical VehicleSteve RamseySteve Ramsey

Simulation, Training,Simulation, Training,Logistics and SustainmentLogistics and Sustainment

Doug GreenlawDoug Greenlaw

Key Growth Areas in 1,500-Program Portfolio

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LMT Investor Conference Orlando 11_07_08 14

• Executing Growth Strategy

• Reputation Has Improved

• Cultivating Innovative Solutions

• Growing Our People

Positioning for Sustained, Long-Term Growth

Summary

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LMT Investor Conference Orlando 11_07_08 15

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LMT Investor Conference Orlando 11_07_08 1

Ken PossenriedeKen PossenriedeVice President, Finance Vice President, Finance & Business Operations& Business Operations

Electronic SystemsElectronic Systems OverviewOverview

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LMT Investor Conference Orlando 11_07_08 2

ES Annuity Programs

~$64B Sales To Date

TD → SDD →

LRIP → Production (U.S.) → Production (Int’l) Sustainment

‘70 ‘75 ‘80 ’85 ’90 ’95 ’00 ’05 ‘10

Aegis/SBMD

MLRS

Apache FC

LANTIRN/Sniper

PAC-3

THAAD

MH-60

AGMS

($B)

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LMT Investor Conference Orlando 11_07_08 3

ES Future Programs

Poised For Future Success

Initial PotentialValue Value

JLTV $50M $20B

FASI-G ID/IQ $5.6B Ceiling

HCM TBD $1.3B

CSAR-X TBD $8B

LCS $500M TBD

UK MFTS $100M $1.0B

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LMT Investor Conference Orlando 11_07_08 4

GWOT SupportArmy Tactical Missile System … 500+ LaunchedGuided Multiple Launch Rocket System … 900+ LaunchedHellfire® … 6,800+ Missiles FiredJavelin™ … 480+ LaunchedSymphony™ … 800+ Devices FieldedDesert Hawk™ … 500 Operational Flights Per MonthPersistent Threat Detection System … 8 Sites 24/7

Wind-Corrected Munitions Dispensers … 900+ ExpendedLongbow® Apache … 1,000+ Targets Destroyed

HIMARS, M270A1 … Readiness Exceeds 99%Sniper® … Combat Proven on U.S., U.K., Norwegian AircraftConvoy Trainers … Over 150,000 UsersInfantry Immersion Trainer … Over 4,000

Marines Trained Prior to Deployment

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LMT Investor Conference Orlando 11_07_08 5

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LMT Investor Conference Orlando 11_07_08 1

Mike TrotskyMike TrotskyVice President, M&FCVice President, M&FC

Air & Missile Defense

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LMT Investor Conference Orlando 11_07_08 2

Ballistic Missile Defense SystemA

ltitu

de

Range (km)0 0 0 0600 1,300 5,500 ~10,000

Boost

Midcourse

Terminal

GMDAegis BMD

Aegis BMD

Aegis BMD

Aegis BMD

Aegis BMD

ABL KE Boost

ABL KE Boost

ABL ABL

THAADTHAAD

THAADArrowArrowPAC-3PAC-3

Short RangeBallistic Missile

(SRBM)

Medium RangeBallistic Missile

(MRBM)

Intermediate RangeBallistic Missile

(IRBM) ICBM

DSP(Acquisition Sensor)

STSS

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LMT Investor Conference Orlando 11_07_08 3

Air and Missile Defense Portfolio

Product

SoS- EAPS/LEAPP/

IBCSMini-HTK

Interceptor SystemOuter TierInterceptor

PAC-3, MSE, MEADS

SBT, ALHTK THAADTHAAD

Growth MissileMultiple Kill

Vehicle

CustomersDomestic/

International Integration

Domestic: C-RAM, Protection

International: C-RAM, VSHORAD

Protection, International

SHORAD

Air Defense, Terminal Defense

Terminal Defense

Terminal, Mid-Course

DefenseMid-Course

Defense

Program Phase

IRAD /Development

IRAD / CRAD/RR Contract IRAD

Production, Spiral

Development

Development(Flight Test),Production

IRAD Development

• •• •

Core, Adjacent ProductsPortfolio Expansion, New Products

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LMT Investor Conference Orlando 11_07_08 4

THAADAttributes• Area Defense System, Defeats Short to Long Range

Ballistic Missiles• Upper Tier of a Two-Tiered Terminal Defense With PAC-3

or MEADS as the Lower Tier• Strategically Transportable, Rapid Insertion Into Theaters

of War• Hit-to-Kill Interceptor, High-Power X-Band Radar• Open Architecture Battle Management System

Accomplishments• Flawless Flight Test Performance• First Production Units Under Contract• Growth Program Defined• Growing International Interest RadarRadar

Battle ManagerBattle Manager

LauncherLauncher

THAAD MissileTHAAD Missile

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LMT Investor Conference Orlando 11_07_08 5

The Future of Air DefenseRadar• Sector Search and Track• 10 Ton Tractor-Trailer• Not Very Mobile or Transportable• 70’s Design

Engagement Control Station• Single Manned Fire Control Van• 70’s Design

• Monochrome displays• Closed Architecture• Proprietary Software

Launcher• 10 ton Tractor-Trailer• Not Very Mobile or Transportable• ’90’s Electronics

Multi-Function FCR• 360o Coverage• Modern X-Band Design

• Optimized for Fire Control• Highly Mobile and Transportable

Surveillance Radar• 360o Coverage• Modern UHF Design•Optimized for Surveillance• Highly Mobile and Transportable

Launcher• Lightweight• Near-Vertical Launch• Modern Electronics• Highly Mobile and Transportable

Missile• Hit-to-Kill MSE Missile

Tactical Operations Center• Two Manned Fire Control Vans• Open Architecture, “Plug-and-Fight”• Interoperable with Allies

Missile• Hit-to-Kill PAC-3 Missile

Today- Patriot Future- MEADS

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LMT Investor Conference Orlando 11_07_08 6

PAC-3 MissileAttributes• Hit-To-Kill (Body-to-Body) Lethality • Destroys Enemy Missiles and the Weapons of

Mass Destruction They May Carry• Kills Entire Threat (Ballistic and Cruise

Missiles, Aircraft, UAV, Helicopters)• Quadruples Available Missiles Per Patriot

Launcher

Accomplishments• Fielded in the U.S. Army• In Production, over 700 missiles delivered• Significant International Interest Continues• Integrated into MEADS system• Combat Proven in Operation Iraqi Freedom

PACPAC--3 Missile3 Missile

PACPAC--3 Missile Intercepts3 Missile Intercepts

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LMT Investor Conference Orlando 11_07_08 7

MSE MissileAttributes• Designed to Kill Advanced Threats• Kills at Higher Altitude and Longer Range• Revolutionary 2-Pulse Rocket Motor • MEADS MissileMilestones• Successful Critical Design Review, February 2007• First Successful Flight in May 2008• First Intercept, 1Q 2009 *• Production Tooling, 2008 *• First Deliveries, 2010 *

* Projected

MSE Missile

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LMT Investor Conference Orlando 11_07_08 8

MEADSAttributes• NATO Cooperative Missile Defense Development

– U.S., Germany and Italy • Replaces Patriot in U.S. Army

– High Firepower, 360 Degree System – Tactically Mobile– Ultra-Reliable – Low Life-Cycle Cost

• Defeats Advanced 21st Century Threats• Uses PAC-3 MSE Missile

Milestones• Preliminary Design Review, December 2007• Critical Design Review, 2010 *• First Deliveries, 2012 ** Projected

Radar SuiteRadar Suite

Battle ManagerBattle Manager LauncherLauncher

MSE MissileMSE Missile

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LMT Investor Conference Orlando 11_07_08 9

Adjacent Business OpportunitiesAir Launched Hit-To-KillFeatures• Integrates PAC-3 Missile Aboard Fighter Aircraft• Provides Boost and Terminal Defense Against Asymmetric

Ballistic and Cruise Missile Threats– Homeland Defense and Contingency Operations

• High Altitude/ High Velocity Launch Provides Long-Range Defense Capability

Accomplishments• Initial Risk Assessment Contract, 2006: It Can Be Done • Follow-On Contract, 2007: Design Canister, Define Flight Test

Demonstration– Demo: Boost Phase Intercept of a SCUD-like Threat Missile

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LMT Investor Conference Orlando 11_07_08 10

Adjacent Business Opportunities

Sea Based Terminal DefenseFeatures• Integrates PAC-3 MSE Interceptor into Aegis Combat System • Defeats Shared Army/Navy Threats and Advanced Anti-Ship

Cruise Missiles• Leverages $1.5B+ DoD Investment in PAC-3 Missile Development

Accomplishments• $18M Navy-Funded Study Completed, Study Revealed:

– MSE Integration into Aegis ”Straight Forward”• Currently Executing Next Program Phase in

Classified Environment

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LMT Investor Conference Orlando 11_07_08 11

International Programs• Increased Awareness of Proliferating Ballistic, Cruise Threats

• Additional PAC-3 Missile Sales In Patriot User Nations• New PAC-3 customer nations also expressing interest• International Interest in THAAD Growing

• Asia, Middle East• Congressional notification of THAAD for UAE in 2008

• Portfolio Expansion - Aegis Sea Based Terminal and Small Warship Missiles

• Potential Air and Missile Defense Systems Integration Opportunities • Europe and the Middle East• Integrated, Short Range and Multi-Tiered Solutions

• Portfolio Well Positioned for Future Product Sales

International Interest in AMD Systems Growing

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LMT Investor Conference Orlando 11_07_08 12

2008 Major Milestones• Delivered the 700th PAC-3 Missile • 3 Successful PAC-3 tests including first two FMS tests• $556M production contract for PAC-3 • Activated THAAD First Unit at Fort Bliss, TX • Successful THAAD intercept -- identified and destroyed

separating target • MEADS PDR approved• Won EAPS contract

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LMT Investor Conference Orlando 11_07_08 13

Future Outlook

•• Our Core Products Are HealthyOur Core Products Are Healthy–– Domestic Business Is Strong and WellDomestic Business Is Strong and Well--SupportedSupported–– Expect Strong PACExpect Strong PAC--3 International Sales, THAAD 3 International Sales, THAAD

And MEADS Will FollowAnd MEADS Will Follow•• Good Adjacent Product PotentialGood Adjacent Product Potential•• Expanding Our Portfolio To PositionExpanding Our Portfolio To Position

For The FutureFor The Future•• High Potential For Solid Long Term GrowthHigh Potential For Solid Long Term Growth

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LMT Investor Conference Orlando 11_07_08 14

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LMT Investor Conference Orlando 11_07_08 1

Tom SimmonsVice President, M&FCVice President, M&FC

Fire Control & Situational Awareness

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LMT Investor Conference Orlando 11_07_08 2

Fire Control

•• Infrared Infrared •• RadarRadar•• AlgorithmsAlgorithms•• Data LinksData Links•• OpticsOptics

Rotary Wing

Fixed Wing Ground

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LMT Investor Conference Orlando 11_07_08 3

Fire Control

Rotary Wing

Fixed Wing

GroundSituational Awareness

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LMT Investor Conference Orlando 11_07_08 4

Rotary Wing SystemsProducts Key Pursuits / Emerging Solutions

Target Sight System (TSS)

Apache Video UAS Intelligent Target (VUIT-2)

Longbow Fire Control Radar

Block III Radar Electronic Unit / UTA

Pathfinder

Arrowhead

Modernized Day Sensor

Visible / Near-IR

Joint and Allied Threat Awareness System

(JATAS)

35-Year Leader in Targeting and Surveillance

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LMT Investor Conference Orlando 11_07_08 5

Rotary Wing Systems

Products Key Pursuits / Emerging Solutions

Growing Portfolio of Systems/Sustainment

Target Sight System Target Sight System (TSS)(TSS)

Apache Video UAS Apache Video UAS Intelligent Target (VUITIntelligent Target (VUIT--2)2)

Longbow Fire Control RadarLongbow Fire Control Radar

Block III Radar Block III Radar Electronic Unit / UTAElectronic Unit / UTA

Pathfinder

ArrowheadArrowhead

Modernized Day Modernized Day SensorSensor

Visible / Near-IR

Joint and Allied Joint and Allied Threat Awareness SystemThreat Awareness System

(JATAS)(JATAS)

New Wins

New Pursuits

• 500th MTADS – Ahead of Schedule

• 500 To Go for US Army/International

In Production for US Army/International

• $40M VUIT Production• 1st of 10 Battalions

in Theater$2B

JATAS Missile Warning Competition

Demos for US Army

In Test for US Army

$60M TSS

Production

$30MDayside

Development Contract

In Production for US Army

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Fixed Wing Systems

Sniper® Advanced Targeting Pod (ATP)

Sniper ATP for the BSniper ATP for the B--1, 1, BB--52, and C52, and C--130J130J

Products Key Pursuits / Emerging Solutions

Gunship Multispectral Sensor (GMS2)

F-35 Lightning II Electro-Optical Targeting System (EOTS)

F/A-18E/F Infrared Search and Track (IRST)

FF--15C and F15C and F--16 IRST16 IRST

FF--22 Advanced 22 Advanced IRSTIRST

CC--17 LAIRCM 17 LAIRCM Missile Warning SystemMissile Warning System

F-22 Missile Launch Detector

Long Range Targeting and Platform Protection

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Fixed Wing Systems

Sniper ATP for the BSniper ATP for the B--1, 1, BB--52, and C52, and C--130J130J

Products Key Pursuits / Emerging Solutions

Gunship Multispectral Sensor (GMS2)

F-35 Lightning II Electro-Optical Targeting System (EOTS) FF--15C and F15C and F--16 IRST16 IRST

FF--22 Advanced 22 Advanced IRSTIRST

CC--17 LAIRCM 17 LAIRCM Missile Warning SystemMissile Warning System

F-22 Missile Launch Detector

Growing US and International Portfolio

Sniper® Advanced Targeting Pod (ATP)

F/A-18E/F Infrared Search and Track (IRST)

New WinsNew Pursuits

B-1 In ProductionB-52 In TestC-130J Pending

USAF Strategic Shift

to IRST

USAF Strategic Shift

to IRST

F/A-18 IRST Navy Contract

$80M GMS2 Production

F-35 EOTSInitial Production

Negotiated

MLD In Production

• 518 Contract/ 263 Backlog 2008 Awards:

• 83 USAF (Largest to Date)• 88 Intl (UK, Singapore,

Saudi, Morocco)• > $300M

Decision 4 Q 2008

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Ground Systems

Common Common ElectroElectro--Optical Optical

SensorsSensors

Ground Mobile Ground Mobile Situational Awareness Situational Awareness Technology (GMSAT)Technology (GMSAT)

Bringing Situational Awareness to Ground Combat

Products Key Pursuits / Emerging Solutions

MEADS InternalMEADS Internal Communication Communication

SubsystemSubsystem

Video UAS Intelligent Video UAS Intelligent Target (VUITTarget (VUIT--ALL)ALL)

UnUn--Cooled Cooled eXtendedeXtended Range (UCXR)Range (UCXR)Ground Soldier Ground Soldier

EnsembleEnsemble

Rocket Propelled Rocket Propelled Grenade DefeatGrenade Defeat

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LMT Investor Conference Orlando 11_07_08 9

Ground SystemsGround Systems

Common Common ElectroElectro--Optical Optical

SensorsSensors

Ground Mobile Ground Mobile Situational Awareness Situational Awareness Technology (GMSAT)Technology (GMSAT)

Technology Success in Adjacent Markets

Products Key Pursuits / Emerging Solutions

MEADS InternalMEADS Internal Communication Communication

SubsystemSubsystem

Video UAS Intelligent Video UAS Intelligent Target (VUITTarget (VUIT--ALL)ALL)

UnUn--Cooled Cooled eXtendedeXtended Range (UCXR)Range (UCXR)Ground Soldier Ground Soldier

EnsembleEnsemble

Rocket Propelled Rocket Propelled Grenade DefeatGrenade Defeat

US Army Night Vision Lab

Contract

$75M Development Scope Increase

CustomerDemos

$1.5B Opportunity

$40MMICS Win

CustomerDemos

VUIT Expansion to Additional

Platforms

New WinsNew Pursuits

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LMT Investor Conference Orlando 11_07_08 10

Situational Awareness Objectives

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Observe | Orient | Decide | Act

Observe: See the Target

Target Sight

Sensor

Gunship Multisensor

System

Common Electro

Optical Sensor

Sniper Advanced

Targeting Pod

Missile Launch

Detectors

F-35 EOTS

Longbow FCRVUIT-2

Arrowhead

Over 7600 Systems Delivered to 24 Countries

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Orient: Evolution to 3-D

Observe | Orient | Decide | Act

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Orient: Google Earth on Steroids

Observe | Orient | Decide | Act

Video Clip

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Observe | Orient | Decide | Act

Decide: Joint Identification and Confirmation

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Decide: Joint Identification and Confirmation

Sniper ATP Video Data Link

Sniper ATP Video Data Link

Apache VUIT-2Apache VUIT-2 Observe | Orient | Decide | Act

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LMT Investor Conference Orlando 11_07_08 16

Act: Engage The Enemy

Observe | Orient | Decide | Act

Apache

Video ClipVideo Clip

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LMT Investor Conference Orlando 11_07_08 17

Act: Engage The Enemy

Observe | Orient | Decide | Act

Gunship

Video Clip

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LMT Investor Conference Orlando 11_07_08 18

Act: Engage The Enemy

Observe | Orient | Decide | Act

Sniper ATP

Video Clip

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LMT Investor Conference Orlando 11_07_08 19

Situational Awareness Expands from Current Systems to Additional Aircraft and Vehicles

Committed Opportunities Worldwide

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Summary• Fire Control is a World Leader in Design and Sustainment of

High Definition Optical Systems

• Quality and Reliability of Targeting Systems Enhances Military Acceptance of Adjacent ISR Products

• Fire Control Plan Succeeding ( )

• Situational Awareness is a Large Business Opportunity

As Engagements Subside Overwatch and Persistent Surveillance Will Continue

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LMT Investor Conference Orlando 11_07_08 21

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LMT Investor Conference Orlando 11_07_08 1

Dan SchultzDan SchultzVice President, MS2Vice President, MS2

Littoral Combat ShipLittoral Combat Ship

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LMT Investor Conference Orlando 11_07_08 2

Why The Navy Needs LCS?Emerging Threats are Challenging our Way of LifePiracy, Small Boats, Blockading Ports & Mines

Budgets Strained to support Current Operations and Build the Next NavyAffordable, Modular, Reconfigurable Ship to meet any threatIncrease USN’s Reach; Access 4,000+ PortsSpeed and Range “To Flex” – Increase Forward PresenceMinimally Manned; Highly Automated

LCS…Affordable Solutions for Changing Threats

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LMT Investor Conference Orlando 11_07_08 3

Lockheed Martin LCS Design Advanced Semi-Planing Steel Monohull

SKWS Decoy LaunchersSKWS Decoy LaunchersRolling Airframe Missile System Rolling Airframe Missile System 3D Radar3D Radar

EOD & GFCSEOD & GFCS

Modular Weapon Zone for Medium Caliber Gun

Modular Weapon Zone for Medium Caliber Gun

COMBATSS-21 Combat Management System & Open Architecture Total Ship Computing Environment

COMBATSS-21 Combat Management System & Open Architecture Total Ship Computing Environment

Facilities for 2 Helos or 1 Helo & 3 VTUAVs

Facilities for 2 Helos or 1 Helo & 3 VTUAVs

Integrated Comms Suite

Integrated Comms Suite

Steel Semi-planing Monohull with Aluminum Superstructure

Steel Semi-planing Monohull with Aluminum Superstructure

SPRINT SPEED > 40 kts (full load) LENGTH (LOA) 115.3 mBEAM (BOA) 17.5 mDRAFT 4.1 mDISPLACEMENT ~3,000 MTRANGE @ Sprint >1,000 nmRANGE @ Cruise >3,500 nm

SPRINT SPEED > 40 kts (full load)LENGTH (LOA) 115.3 mBEAM (BOA) 17.5 mDRAFT 4.1 mDISPLACEMENT ~3,000 MTRANGE @ Sprint >1,000 nmRANGE @ Cruise >3,500 nm

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LCS 1 Status

USN’s Board of Inspections & Survey – LCS 1 is “Capable, Well Built…”Ship Exceeded Expectations

0 to 40+ Knots in 2 Minutes Tremendous High Speed Handling During TurnsShip turned on axis With Steerable Waterjets EngagedCombat Management Systems: Demonstrated Detect To Engage for Weapons

Sea Change in Shipbuilding•Concept to Delivery in 6 years•Best Acceptance Trial in last 4 Shipbuilding programs

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LMT Investor Conference Orlando 11_07_08 5

Video Clip

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LMT Investor Conference Orlando 11_07_08 6

LCS Roadmap*Domestic

International

FY 12-19

+EXCOMM

RadarLaunching

System

Decoy Launcher

Multi Mission / LM Systems

Sustainment

COMBATSS 21

Mission Package

FY 10

FY 11

FY 09 Millennium Gun

Israel

Saudi Arabia

(2)

(3)

(3)

(4-6/Yr)Total Domestic Program

55 Ships

International Market

14 - 40 Ships

(14)

(2)

* Potential Opportunity

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SummaryLCS 1 Delivered and Performing Well

Exceptional Acceptance trialsSuccessfully Demonstrated a Innovative / Robust Propulsion Train

LM Team Providing Sustainment Support for LCS 1 … New market Area for LM LCS teamOn Track for Early 2009 Ship AwardSignificant Domestic Opportunity 50+ ships over next decadeSignificant International Interest (18 Navies) … Two near Term Opportunities

LCS, an Enterprise in the Making

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LMT Investor Conference Orlando 11_07_08 8

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LMT Investor Conference Orlando 11_07_08 1

Orlando CarvalhoOrlando CarvalhoVice President, MS2Vice President, MS2

Sea Based Missile Defense

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Ballistic Missile Defense SystemA

ltitu

de

Range (km)

0 0 0 0600 1,300 5,500 ~10,000

Boost

Midcourse

Terminal

GMDAegis BMD

Aegis BMD

Aegis BMD

Aegis BMD

Aegis BMD

ABL KE Boost

ABL KE Boost

ABLABL

THAADTHAAD

THAADArrowArrowPAC-3PAC-3

Short RangeBallistic Missile

(SRBM)

Medium RangeBallistic Missile

(MRBM)

Intermediate RangeBallistic Missile

(IRBM) ICBM

DSP(Acquisition Sensor)

STSS

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MS2 Ballistic Missile Defense Portfolio

ProductProduct MEADS RadarMEADS Radar TPSTPS--5959 Aegis Weapon Aegis Weapon SystemSystem

SS--Band Advanced Band Advanced RadarRadar

HAAHAA

CapabilityCapability Air Defense, Terminal Air Defense, Terminal DefenseDefense

Air Defense, Terminal Air Defense, Terminal Defense Defense

SeaSea--Based Missile Based Missile Defense (SBMD)Defense (SBMD)

Terminal, MidTerminal, Mid-- Course DefenseCourse Defense

Terminal, MidTerminal, Mid-- Course DefenseCourse Defense

Program PhaseProgram Phase Production, Spiral Production, Spiral DevelopmentDevelopment

Production, Spiral Production, Spiral DevelopmentDevelopment

Spiral Development, Spiral Development, DeploymentDeployment IRADIRAD DevelopmentDevelopment

International International OpportunityOpportunity ‘‘05 05 –– ‘‘3030 ‘‘05 05 –– ’’1515 ’’05 05 –– ’’1515 ’’12 12 –– ’’1818 ’’12 12 –– ’’1515

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Aegis BMD RoadmapMDA Sponsored

DevelopmentSingle Mission Focus

Navy Sponsored Development

Multi-MissionInteroperability

Radar Upgrades

Global Political Support Through

International Cooperative Programs

Target Platforms

Domestic

Modernized Aegis Cruisers & Destroyers

CG(X)

F-100

Kongo

Produces

Global, Mobile & LinkedMulti-Mission Focus

Spiral UpgradesExtended Battlespace

KDX

3.x4.x

5.x

LCS

AWD

Self defense

Area defense

BMD

DDG 51 Follow-On

Integrated Air & Missile Defense

Funded & on scheduleCompleted

Open Architecture (OA)Solid-State Radar

Multi-Mission Signal Processor

International

+ =

Integrates with

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LMT Investor Conference Orlando 11_07_08 5

Operation Burnt Frost

“Challenge” to “Execution” in less than 45 days

““ChallengeChallenge”” to to ““ExecutionExecution”” in less than 45 daysin less than 45 days

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Satellite Intercept

Aegis BMD Accomplishments to Date

JCTV-1

Joint Cooperative Research

Future Testing• JFTM-2 (11/08): Allied Intercept• FTM-15 (5/09): Engage IRBM (Launch on TADIL)

• FTM-16 (9/10): SM-3 Block IB Engage MRBM

Future Testing• JFTM-2 (11/08): Allied Intercept• FTM-15 (5/09): Engage IRBM (Launch on TADIL)

• FTM-16 (9/10): SM-3 Block IB Engage MRBM

PAC EX IVPAC EX IV

Homeland DefensePAC EX

I, II, IIIIFT-9 IFT-10

LRS&T

GT-180Glory Boost

Pacific Phoenix

Sea Based Terminal

SM-3 BLK IAAegis 3.6First Coalition Test

First Intercept

FM-2

Ascent Phase Intercept

Descent Phase With Aim Point Adjust

No Notice Firing

Simultaneous BMD / AAW Engagements Auto-BMDPulse DACS

First Firing from Japanese Destroyer

17 Dec 07JFTM-1

5 Jun 08FTM-14

Engage SRBM in Terminal

First ICBM Tracking - 10 Sep 02

25 Jan 02 FM-313 Jun 02 FM-4

21 Nov 02 FM-518 Jun 03 FM-6

11 Dec 03 FTM-04-1 FM-7

24 Feb 05 FTM 04-2 FM-8

17 Nov 05

Separating Warhead

FTM-1022 Jun 06 FTM-11

7 Dec 06 FTM-11 Event 4

26 Apr 07 FTM-1222 Jun 07

6 Nov 07FTM-13

Engage DualSRBMs

Aegis BMD, We Deliver!

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Aegis BMD Evolution - Meeting the Mission Needs

Capability Fielding Estimated Timeframe Status

1st Generation

• Initial Surveillance Capability to meet Presidential direction

• Certified Integrated Air Defense & Ballistic Missile Surveillance / engagement

• Certified Near Term Sea Based Terminal

• 21 ships • 2008• Development complete• 18 ships fielded• 3 remaining in process

2nd Generation • Increased capability to identify and engage complex ballistic Missile threats • 21 ships • 2011 • Development in

process

3rd Generation • Integrated Air and Missile Defense• Over the horizon Air Defense

• Potential deployment to all 84 Aegis ships • 2013 • Development in

process

4th Generation• Extended Range integrated air and

Missile Defense• Additional Radar capability

• Aegis DDG continuation (12 ships)

• Potential backfit to Aegis fleet

• 2015 • Proposed

Continued Business Growth through New Capability Development

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LMT Investor Conference Orlando 11_07_08 8

Shipbuilding Course Change…

New:

FY09 FY10* FY11 *

FY12* FY13* FY14* FY15*FY07/08

DDG 1000

CG(X)

Old:

DDG Continuation

DDG 1000

CG(X)

FY09 FY10 FY11 FY12 FY13 FY14 FY15FY07/08 FY16 FY17

*

*$200M AP / Spares * Projected Based on OPNAV N8’s 31 July ‘08 HASC Testimony

4th Generation Aegis BMD

POM 10 Expected to Codify the New Plan

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Ship Deliveries planned as of October 2008

USS JOHN S. McCAIN (DDG 56)

USS JOHN S. McCAIN (DDG 56)USS PORT ROYAL (CG 73)USS PORT ROYAL (CG 73)USS SHILOH (CG 67)USS SHILOH (CG 67) USS DECATUR

(DDG 73) USS DECATUR

(DDG 73)USS FITZGERALD (DDG 62)USS FITZGERALD (DDG 62)

USS VELLA GULF (CG 72)

USS VELLA GULF (CG 72)

USS MONTERREY (CG 61)

USS MONTERREY (CG 61)

USS THE SULLIVANS (DDG 68)

USS THE SULLIVANS (DDG 68) JS MYOKO

(DDG 175)JS MYOKO(DDG 175)

11/2009 11/2010

USS O’KANE (DDG 77)USS O’KANE (DDG 77) USS BENFOLD (DDG 65)USS BENFOLD (DDG 65) USS PAUL HAMILTON(DDG 60)

USS PAUL HAMILTON(DDG 60)USS HOPPER (DDG 70)USS HOPPER (DDG 70)USS MILIUS (DDG 69)USS MILIUS (DDG 69) USS HIGGINS

(DDG 76) USS HIGGINS

(DDG 76)

USS LAKE ERIE (CG 70)USS LAKE ERIE (CG 70)

USS CURTIS WILBUR(DDG 54)

USS CURTIS WILBUR(DDG 54)

USS STETHEM(DDG 63)

USS STETHEM(DDG 63)

USS RUSSELL(DDG 59)

USS RUSSELL(DDG 59) USS JOHN PAUL JONES

(DDG 53) USS JOHN PAUL JONES

(DDG 53) USS RAMAGE (DDG 61)USS RAMAGE (DDG 61) USS Stout (DDG 55)USS Stout (DDG 55)

JS KONGO(DDG 173)

JS KONGO(DDG 173) JS CHOKAI

(DDG 176)JS CHOKAI(DDG 176)

JS KIRISHIMA(DDG 174)

JS KIRISHIMA(DDG 174)

Additional Ships to be Upgraded International

Aegis BMD At-Sea, On PatrolUpgraded from Surveillance to Engagement Capability

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International SBMD Expanding the International Base

•• Develop International SeaDevelop International Sea--Based Terminal MarketBased Terminal Market•• Expand SBMD product set into Expand SBMD product set into ““nonnon--AegisAegis”” ShipsShips•• Provide sustainment and upgrades throughout lifecycleProvide sustainment and upgrades throughout lifecycle

Sea-based BMD FunctionalitySea-based BMD Functionality

Japan BMDDDG 176

Japan BMDDDG 173 Japan BMD

DDG 174

Japan BMDDDG 175

FYFY 0606 0707 0808 0909 1010 1111 1212 1313 1414 1515 1616 1717 1818

BudgetedFuture Opps

Korea KDXIIIBMD Upgrades

Japan Advanced BMD

IsraelSBT

AustraliaSEA4000

BMD Upgrades

NorwaySBT

Japan2319-2320

DDG

SaudiSBT

GreeceBMD

Japan BMD OAUpgradesATAGO

Japan BMD OAUpgradesKONGODutch

BMD

GermanBMD

SpainF-100

BMD Upgrades

•• Japan is International Aegis BMD LeaderJapan is International Aegis BMD Leader

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Tank

endo-atmosphere

RV

Terminal Operating Area

Midcourse Operating Area

SM-3

SBT Interceptor

Tank

endo-atmosphere

RV

Terminal Operating Area

Midcourse Operating Area

SM-3

SBT Interceptor

International Sea-Based Terminal and Aegis Ashore - Creating New Base

Critical Enablers

MarinizedPatriot Missile

Aegis Open Architecture / COMBATSS 21

MK 41 VLS

Sea-Based Terminal

Aegis Ashore

BSP

Marinized Patriot Missile Enables BMD into Small Ships Aegis Ashore Provides Needed BMD Surveillance & C2

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Sea-Based Missile Defense Summary• Flawless Execution• Aegis BMD Demand

Signal Growing…– 18 to 21 Ships

(Atlantic Fleet expansion)– Aegis BMD to entire

Aegis Fleet– Aegis DDG Continuation– Japan: Modernize and

Expand to 8 BMD shootersNew Construction DDG51s

Lockheed Martin Delivering Unmatched Sea-Based Ballistic Missile Defense Capabilities

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LMT Investor Conference Orlando 11_07_08 13

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LMT Investor Conference Orlando 11_07_08 1

Jeff BantleVice President, SI-O

VH-71 Presidential Helicopter

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Increment 1 : • Immediate Need to Provide Capability • Comm/Nav/Equal to or Better than Current

Capabilities• Executive Accommodations Equal to or

Better Than Current Capabilities• 4 Test Vehicles (1 Contr.)• 5 Production Aircraft

“In the post-September 11 national security environment, I am convinced of our need to reexamine the replacement schedule for the VH-3D presidential helicopter fleet.”

“… I am concerned about identified VH-3D maintenance and performance deficiencies that directly impact the ability to provide requisite level of support to the president.”

Source: Chief of Staff Andrew Card Memo 26Nov02

VH-71 Program Background

Increment 2:• Capability Driven• Full Command and Control Capability for the

President• Safe Transport for the next 40 years• 4 Test Vehicles (1 Contr.)• 23 Production Aircraft

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VH-71 Test Vehicle StatusTV1 – 700+ Flight Hours

TV2 – (Pax) 50+ Flight Hours

TV5 – (Pax) 23+ Flight Hours

TV3 – Missionization

TV4 - Missionization

Entered Flight Test Sept 2005

TV1

First Flight Jul 3, 2007Arrive in US Oct 16, 2007

TV2

TV5

First Flight Dec 11, 2007Arrive in US Dec 19, 2007

First Flight Feb 27, 2008 Arrive in US Mar 17, 2008

First Flight Mar 19, 2008Arrive US Apr 24, 2008

TV3 TV4

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PP Aircraft – Build Line

VH-71 Production Vehicle Status• PP1 – First Flight – Sept ’08

• Delivery to U.S. in November

• PP2 – Completed NAVAIR 90% Electrical Inspection

• PP3 – Completed NAVAIR 60% Electrical inspections

• PP4 – Fuel flow test

• PP5 – Stage 3 build

PP1 - First Flight Sept 22, 2008

PP2 – Flight HangarPP3 – Build Line

PP4 – Build Line PP5 – Build Line

Production Vehicles to be delivered to U.S. in next 6 months

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VH-71 Increment 2• Rebaseline In Process

– System Engineering Technical Review process lowers risk

– Reduced Concurrency with Increment 1

• Key Stakeholders :– Full Capability Needed– US101 is the Right Platform

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Total Business Opportunity2012 2015 2018

Base ProgramBase Program

VHVH--71 Follow On71 Follow On

New ProgramNew Program

Increment 2

Logistics Support and Training

ECPs

CH-71 Greentops

LRIP/Production

Increment 1

Multi Billion Dollar Opportunity

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During the Last YearAll Test Vehicles Completed (July ’07, Dec ’07, Feb ’08, Mar ’08 )

All Test Vehicles Delivered to US (Oct ’07, Dec ’07, Mar ’08, Apr ’08 )

Pax River NAS Labs Operational Jul ’08

Increment 1 OTB Proposal Delivered Sept ’08

Increment 2 Proposal received Sept ’08

First Production Vehicle completed first flight Sept ’08

FY09 Funding Inc 1 $735M / Inc 2 $100M Sept ’08

Increment 1 Full Function Software complete Sept ‘08

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VH-71 Program Summary• Increment 1 - Progress Continues

– Test Vehicles in the US– Production aircraft completing build– All Key Performance Parameters

being met

• Increment 2 - Moving forward on Rebaseline

– White House – Full set of Requirements Remain

– US101 is the Right Platform

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LMT Investor Conference Orlando 11_07_08 9

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LMT Investor Conference Orlando 11_07_08 1

Steve RamseyVice President, SI-O

Ground Vehicles

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LMT Investor Conference Orlando 11_07_08 2

Ground Vehicles

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Customer Needs Drive Strategy

• LM market gap analysis in 2002 -- enter military vehicle market

• Wheeled vehicle fleet needs to be replaced– 60% of fleet over 20 years old

– Customer ops tempo wearing out fleet

– New threats require new vehicles

• Customer needs a “system”, not a “truck”

$20B+ JLTV Opportunity

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Why Lockheed Martin?

• Dedicated Team Established– Hired 50+ automotive/

customer/user experts– 75+ patent/applications/

disclosures– Detroit/Quantico offices

established• Acquired Key Technologies

– Purchased HMT Vehicles– Early IRAD prototypes

• Developed Customer Intimacy

• Strategic Partnering• Systems Approach to JLTV

Strategically Positioned to win JLTV and Other Int’l Opportunities

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Drive TypeWeight Class

End Use

WheeledWheeled

TrackedTracked

LightLight

HeavyHeavy

MediumMedium

Logistic SupportLogistic Support

Mission SystemsMission Systems

CombatCombat

Special MissionSpecial Mission

Military Vehicle Market Segments

= Current LM Play= Current LM PlayFTTSJLTV TDOUVSMiddle East

STRAT-VLWPMCanada

LAV-C2Saudi-C2JLTV TD

MRAP “Lite”MPC

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Infantry Carrier

General Purpose

JLTV Program OverviewCustomer: Joint: USMC/Army led

International cooperation desired (e.g. Australia, UK)

Program Description: Replace existing HMMWV fleet

Schedule: Tech Development Phase – October 2008- 3 Awards

SDD Phase – 2010 - TBD

Production Phase – 2012 - TBD

Production: 63,321 JLTVs thru 2020

Value: ~$20B+

Utility Vehicle

170,000+ HMMWVs Worldwide - ~$75B

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Fabricated Assemblies

Vehicle SafetySystems

Mobility & Protection SystemsArmor, High Volume Assembly

Chassis DesignMaterial Expertise

Engines

Transmissions

Advanced Networking/Routing

Netcentric Computer System

JLTV Team Lockheed Martin

Modeling & Simulation

Prime, Design Authority, Systems Integration, C4ISR

Development, T&E, Advanced Systems Capabilities,

Supportability

Systems Integration - OwegoSimulation, Training & Support

Integrated Logistics/Training

Missiles & Fire ControlSurvivability, Modeling & Simulation

Corporate ResourcesNet-Centricity - Lighthouse

Advanced Development ProgramsMaterials (Super TI)

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TD Program Overview• Award Date : Oct. 29• Value: Approx. $50M• Duration: 27 Months• Deliverables:

– 7 Vehicles– 4 Trailers– Blast Hulls– Ballistic Panels– 12 Month Test Program– Data similar to SDD program

• Anticipated Outcome: Inform requirements for SDD Phase or direct advancement to Production Contract

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LM JLTV Operational Prototypes

JLTV Infantry Carrier Operational Prototype 22,000+ Miles of Test

COMPLETED!

JLTV Utility Vehicle Prototype5,000+ Miles of Test

COMPLETED!

Demonstrating System Maturity

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LMT JLTV General Purpose Test Vehicle

JLTV General Purpose Prototype – Operational and Ready for Test!

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MRAP “Lite”• Driven by Urgent Operational need

for Afghanistan• MRAP protection, JLTV Speed and

Mobility• Production of 2,000 Vehicles in

2009/2010• RFP expected in November

– LM Team JLTV will respond with a JLTV variant

• JLTV-CVL (Combat Vehicle – Light)

Additional $1-2B Opportunity

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OUVS - Operational Utility Vehicle System• Customer: UK MoD• 8,000 vehicles desired• LM leading UK Team• PQQ responded to in August

– Competition – 36 vehicles from 18 companies– Down selected to 7 competitors for small, 6

competitors for large• LM one of 4 companies down selected in both

• ITT expected May 2009, Contract Award April 2011

Additional ££1B+ Opportunity1B+ Opportunity

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Video Clip

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•• JLTV JLTV –– TD AwardTD Award–– JLTV General Purpose TV BuiltJLTV General Purpose TV Built–– 25K+ Tested Miles on TVs25K+ Tested Miles on TVs–– Strategic TeamingStrategic Teaming

•• OUVSOUVS–– DownselectedDownselected

•• Pursuing International Pursuing International OpportunitiesOpportunities

Ground Vehicle Summary

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LMT Investor Conference Orlando 11_07_08 15

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LMT Investor Conference Orlando 11_07_08 1

Doug GreenlawVice President, STS

Simulation, Training & Support

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STS Overview• A Leader in US Military Market for 10+

Years

• Operate in over 50 Locations Worldwide

• Balanced Portfolio Across DoD

• Significant Expansion into International and Civil Sectors

Navy  / Marines24%

Army27%

Air Force49%

International

DefenseCivil Gov't/ 

Intelligence

84%84%5%5%

11 %11 %

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What we do …

Video Clip

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What we do …

SimulationSimulation TrainingTraining SupportSupport

““Reinvent How People Prepare Reinvent How People Prepare For Their TomorrowFor Their Tomorrow””

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Market Trends

Demographics ChangingTechnology Accelerating

Emergence

Traditional Training Approaches will not Suffice

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Leading the Training RevolutionTraining Today

• Training is a Discrete Event

• Instructor-centric

• Fixed Curriculum

• Considered a Cost

Training Tomorrow• Persistent, Anytime / Anywhere, Lifelong

• Learner-centric

• Adaptive to Learner Experience and Style

• Viewed as an Investment

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Key Technologies

Science of Learning Human Performance Engineering

Performance Optimization Virtual Worlds

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Business Strategy

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Aug Aug ‘‘07 Investor Conference07 Investor Conference

• UK Military Flying Training System– Program Well Underway– 25 Year Partnership

• Singapore Basic Wings Course– Achieved Initial Capability in 19 Months– 20 year Partnership

First to Market with Turnkey Training Approach

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Comprehensive Training Solutions Special Operations Mission Rehearsal

Lockheed Martin Aircraft JSF Training Solution

Flight Training

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Ground Training

Live Training Vehicle Training

Command Training & Wargaming Urban Operations

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Logistics

Support & Test Equipment Sensor Systems

Logistics Information Fusion Autonomic Logistics

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Market Evolution

CommodityCommodity

Class RoomsImage Generators

Market Value Chai

nMarket Va

lue Chain2000

1990

1980

2010ProductProduct

Training Devices

10x

ServiceService

Training Centers

10x

F‐35 JSF Training System

10x

ExperienceExperience

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Turn Key Training Growth

US Traditional Training US Traditional Training ProviderProvider

UK Military Flying UK Military Flying Training SystemTraining System

Singapore Basic Wings Singapore Basic Wings CourseCourse

FF--35 JSF Training 35 JSF Training SolutionSolution

US Turn Key TrainingUS Turn Key TrainingProviderProvider

25 Yr Public Private Partnership (PPP)

20 Yr Privately Finance Initiative (PFI)

US and 8+ International Countries

Middle East Training CentersMiddle East Training Centers

Market Changing Approach

Multiple Air & Ground Opportunities

Foundation for International Growth

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Turn Key Business

Singapore Basic Wings Course

UK Military Flying Training System

Singapore FighterWings Course

Australia PilotTraining System

UAE TrainingSystems Integrator

Kuwait Training Center

India Multi‐Role Combat Aircraft

F‐35 Joint Strike Fighter

Traditional 

TrainingProducts

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Adjacent Market Opportunities Expansion

Disaster Disaster 

PreparednessPreparednessSimulation BasedSimulation Based

AcquisitionAcquisitionNurse Nurse 

EducationEducationTeacher Teacher 

DevelopmentDevelopment

Modeling & Simulation Training & Learning

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Summary• STS is Redefining Training and Support

– A Leader in US Military Market for over 10 Years– Recognized Training Arm of Corporation

• Positioned for Growth …– Rapidly Growing International Portfolio – Leading Implementation of Military Turn Key Training Model– Reinventing How People Prepare For Their Tomorrow

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Facility Tour

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iTouch Tour Assistant

Resilient 

Core

Agility/Speed 

to Market

?

Market

Expansion

Innovative 

Business

Models 

Innovative Technology 

Resilient Core

Agility/Speed 

to Market

?

Market

Expansion

Innovative 

Business

Models  Innovative 

Technology 

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Tour Layout & Flow

Maritime Training 

& Controls

LMIS

Turn KeyTraining Virtual

Training

CombatConvoySimulator

11

22

EndEnd

Tactical 

Ops 

Center

Military OperationsIn Urban Terrain

UnmannedOperations

Logistics IT& Sensors

F‐35 JSF& Space

STS Solutions CenterSTS Solutions Center

After Action 

Review

33

VisualDome

Resilient Core Agility/Speed to 

Market

?

Market

Expansion

Innovative 

Business

Models  Innovative 

Technology 

GroundTraining

Incident‐Management 

Simulation

55

Yesterday’s 

Classroom

44

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