CAE reports fourth quarter and full-year financial results for fiscal year 2013

CAE reports fourth quarter and full-year financial results for fiscal year 2013 
- Q4 and full-year revenue up 16% over prior year  
- Q4 EPS of C$0.17 (C$0.21 before restructuring, integration and
acquisition costs) vs. C$0.21 in prior year  
- Full-year EPS of C$0.54 (C$0.74 before restructuring, integration
and acquisition costs) vs. C$0.70 in prior year   
- Record $4.1 billion order backlog 
MONTREAL, CANADA -- (Marketwired) -- 05/16/13 -- (NYSE:CAE)(TSX:CAE)
- CAE today reported financial results for the fourth quarter and
full-year ended March 31, 2013. Net income attributable to equity
holders was $43.8 million ($0.17 per share) this quarter, compared to
$53.2 million ($0.21 per share) last year. Net income attributable to
equity holders for the year was $139.4 million ($0.54 per share),
compared to $180.3 million ($0.70 per share) last year. All financial
information is in Canadian dollars. 
Excluding $10.1 million (after-tax) of restructuring, integration and
acquisition costs this quarter, net income attributable to equity
holders was $53.9 million ($0.21 per share). On the same basis, it
was $190.7 million ($0.74 per share) for the year. 
Revenue for the quarter was $587.9 million, 16% higher than $506.7
million in the fourth quarter last year. For the full year, revenue
was $2,104.5 million, up 16% from $1,821.2 million last year. 
"Our results for the quarter and the year reflected our integration
of new businesses and restructuring of Civil and Military
operations," said Marc Parent, CAE's President and Chief Executive
Officer. "Backlog exceeded $4 billion for the first time in CAE's
history, with a high proportion involving recurring services. In
Civil Products, we had a strong finish to the year, meeting our
mid-30s full-flight simulator order outlook. With continued high
levels of aircraft deliveries, we expect strong demand for civil
full-flight simulators again in fiscal 2014. In Civil Training, the
integration of Oxford progressed well, with cost synergies on target.
In Military, we booked orders involving enduring aircraft programs,
which gives us confidence in sustaining our business in a
still-challenging environment. New Core Markets delivered on our
financial goals and we expect our investments in new products and
expanded sales capabilities to bear fruit in the period ahead." 
Summary of consolidated results 


 
(amounts in                                                                 
 millions, except                                                           
 operating                                                                  
 margins)             FY2013  FY2012 Q4-2013 Q3-2013 Q2-2013 Q1-2013 Q4-2012
----------------------------------------------------------------------------
Revenue            $ 2,104.5 1,821.2   587.9   522.1   514.4   480.1   506.7
Operating profit                                                            
 (1)               $   245.7   302.1    71.6    62.4    66.9    44.8    88.7
As a % of revenue  %    11.7    16.6    12.2    12.0    13.0     9.3    17.5
Net Income         $   142.4   182.0    46.4    37.5    36.8    21.7    53.7
Net income                                                                  
 attributable to                                                            
 the equity                                                                 
 holders of the                                                             
 Company           $   139.4   180.3    43.8    37.8    36.5    21.3    53.2
Backlog (2)        $ 4,091.9 3,724.2 4,091.9 3,833.0 3,909.1 3,894.5 3,724.2
----------------------------------------------------------------------------

 
Civil segments 
Revenue for our combined Civil segments increased 54% in the fourth
quarter to $331.6 million compared to $215.4 million last year.
Fourth quarter operating profit was $54.1 million (16.3% of revenue)
compared to $44.3 million (20.6% of revenue) last year. 
Annual revenue was $1,158.0 million, up 38% from $840.9 million last
year. Annual operating profit was $195.1 million (16.8% of revenue)
compared to $173.8 million (20.7% of revenue) last year. 
We received 10 full-flight simulator (FFS) orders in the fourth
quarter to conclude the year with 35 in total. We also obtained
training services contracts expected to generate $456.7 million in
future revenue, including long-term training services contracts with
LAN, TAM, Turkish Airlines, Virgin Atlantic and Brussels Airlines. We
also renewed a long-term contract with GE Capital Aviation Services
for crew sourcing and we signed an agreement with Ryanair for
training and recruitment services. 
We received $607.5 million in combined civil segment orders this
quarter representing a book-to-sales ratio of 1.83x. The ratio for
the trailing 12 months was 1.18x. 
Training & Services/Civil (TS/C) 


 
(amounts in                                                                 
 millions except                                                            
 operating                                                                  
 margins, RSEU(3)                                                           
 and FFSs                                                                   
 deployed)            FY2013  FY2012 Q4-2013 Q3-2013 Q2-2013 Q1-2013 Q4-2012
----------------------------------------------------------------------------
Revenue            $   755.6   498.4   201.8   193.8   189.1   170.9   132.3
Segment operating                                                           
 income            $   121.5   122.2    31.8    29.1    27.3    33.3    30.3
Operating margins  %    16.1    24.5    15.8    15.0    14.4    19.5    22.9
Backlog            $ 1,602.2 1,183.4 1,602.2 1,345.8 1,360.9 1,400.0 1,183.4
RSEU(3)                  181     139     187     186     187     164     142
FFSs deployed            227     171     227     222     218     216     171
----------------------------------------------------------------------------

 
Simulation Products/Civil (SP/C) 


 
(amounts in                                                                 
 millions except                                                            
 operating                                                                  
 margins)             FY2013  FY2012 Q4-2013 Q3-2013 Q2-2013 Q1-2013 Q4-2012
----------------------------------------------------------------------------
Revenue            $   402.4   342.5   129.8    93.4    98.9    80.3    83.1
Segment operating                                                           
 income            $    73.6    51.6    22.3    18.0    18.9    14.4    14.0
Operating margins  %    18.3    15.1    17.2    19.3    19.1    17.9    16.8
Backlog            $   383.2   351.6   383.2   361.2   385.2   361.9   351.6
----------------------------------------------------------------------------

 
Military segments 
Revenue for our combined Military segments decreased 15% in the
fourth quarter to $227.3 million compared to $267.1 million last
year. For the year, revenue was $834.4 million, down 7% from $897.3
million last year. 
Combined Military operating income was $29.4 million (12.9% of
revenue) for the quarter, compared to $45.6 million (17.1% of
revenue) last year. For the full year, operating income was $113.1
million (13.6% of revenue), compared to $142.1 million (15.8% of
revenue) last year. 
We booked orders in our Simulation Products Military segment during
the quarter involving enduring aircraft types like the MH-60 Seahawk
helicopter and the C-130J Hercules transport aircraft. These orders
comprised simulator products and updates in support of the U.S. Navy
and Air Force, the Royal Australian Navy, and the Israeli Air Force.
We were also awarded contracts in our Training and Services Military
segment to provide a range of maintenance and support services for
customers including NATO, the U.S. Air Force, the German Armed
Forces, and the Taiwan Air Force. As part of the U.S. Air Force's
KC-135 Aircrew Training Systems program, for which CAE is the prime
contractor, we were awarded an additional contract to provide
operations and maintenance support involving the aerial refueling
aircraft's boom operator trainers. 
We received $215.9 million in combined military segment orders this
quarter, representing a book-to-sales ratio of 0.95x. The ratio for
the trailing 12 months was 0.92x. 
Simulation Products/Military (SP/M) 


 
(amounts in                                                                 
 millions except                                                            
 operating                                                                  
 margins)             FY2013  FY2012 Q4-2013 Q3-2013 Q2-2013 Q1-2013 Q4-2012
----------------------------------------------------------------------------
Revenue            $   561.6   619.2   154.9   140.5   130.8   135.4   195.6
Segment operating                                                           
 income            $    77.9   101.2    19.2    18.3    20.9    19.5    34.6
Operating margins  %    13.9    16.3    12.4    13.0    16.0    14.4    17.7
Backlog            $   685.0   786.0   685.0   728.9   723.1   755.6   786.0
----------------------------------------------------------------------------

 
Training & Services /Military (TS/M) 


 
(amounts in                                                                 
 millions except                                                            
 operating                                                                  
 margins)           FY2013  FY2012 Q4-2013 Q3-2013 Q2-2013 Q1-2013   Q4-2012
----------------------------------------------------------------------------
Revenue          $   272.8   278.1    72.4    65.7    67.3    67.4      71.5
Segment                                                                     
 operating                                                                  
 income          $    35.2    40.9    10.2     8.7     7.4     8.9      11.0
Operating                                                                   
 margins         %    12.9    14.7    14.1    13.2    11.0    13.2      15.4
Backlog          $ 1,421.5 1,403.2 1,421.5 1,397.1 1,439.9 1,377.0   1,403.2
----------------------------------------------------------------------------

 
New Core Markets 
Revenue in New Core Markets was $29.0 million for the quarter, up 20%
from $24.2 million last year. Operating income was $1.8 million for
the quarter, compared to negative $1.2 million last year. Annual
revenue was $112.1 million up 35% from $83.0 million last year and
operating income was $6.4 million, compared to negative $13.8 million
last year. 
In CAE Healthcare, we continued to make good progress penetrating
global markets with sales of our surgical, patient, and ultrasound
simulators, as well as centre management systems to customers in
Canada, the U.S., Australia, India and Saudi Arabia. 
In CAE Mining, we sold our mine planning software to customers in
China and Russia and our new stratigraphic modeling software to
customers in South Africa and Chile. We also received a contract to
implement a complete suite of geological data management, resource
modeling and mine planning software to a gold mining company
operating long life projects in Vietnam and Malaysia. 
New Core Markets (NCM) 


 
(amounts in                                                                 
 millions)           FY2013 FY2012  Q4-2013 Q3-2013 Q2-2013 Q1-2013 Q4-2012 
----------------------------------------------------------------------------
Revenue            $  112.1   83.0     29.0    28.7    28.3    26.1    24.2 
Segment operating                                                           
 income (loss)     $    6.4  (13.8)     1.8     1.7     2.2     0.7    (1.2)
Operating margins  %    5.7      -      6.2     5.9     7.8     2.7       - 
----------------------------------------------------------------------------

 
Additional financial highlights 
Income taxes this quarter were $7.0 million representing an effective
tax rate of 13%, compared to 26% last year. The decrease in the
effective tax rate from the fourth quarter of fiscal 2012 was mainly
due to the settlement of tax audits as well as the change in the mix
of income from various jurisdictions. Excluding the effect of the one
- time items in the quarter, the income tax expense would have been
$11.5 million. The impact of these one-time items represents $0.02 on
earnings per share. 
Free cash flow(4) was positive $108.6 million this quarter. Our free
cash flow is generally higher in the second half of the fiscal year,
a trend that is expected to continue in fiscal 2014. The increase in
free cash flow compared to the fourth quarter last year results
mainly from favorable changes in non-cash working capital. 
Capital expenditures totalled $32.4 million this quarter, including
$29.5 million for growth and $2.9 million for maintenance. 
Net debt(5) was $916.8 million as at March 31, 2013, compared with
$965.4 million as at December 31, 2012. 
CAE will pay a dividend of $0.05 per share effective June 28, 2013 to
shareholders of record at the close of business on June 14, 2013. 
Additional information 
You will find a more detailed discussion of our results by segment in
the Management's Discussion and Analysis 
(MD&A) as well as in our consolidated interim financial statements
which are posted on our website at www.cae.com/investors. 
CAE's unaudited consolidated interim financial statements and
management's discussion and analysis for the quarter ended March 31,
2013 have been filed with the Canadian securities commissions and are
available on our website (www.cae.com) and on SEDAR (www.sedar.com).
They have also been filed with the U.S. Securities and Exchange
Commission and are available on their website (www.sec.gov). 
Conference call Q4 and full-year FY2013 
CAE will host a conference call focusing on fiscal year 2013 fourth
quarter and full-year financial results today at 1:00 p.m. ET. The
call is intended for analysts, institutional investors and the media.
Participants can listen to the conference by dialling + 1 877 586
3392 or +1 416 981 9024. The conference call will also be audio
webcast live for the public at www.cae.com. 
CAE is a global leader in modeling, simulation and training for civil
aviation and defence. The company employs approximately 8,000 people
at more than 100 sites and training locations in approximately 30
countries. CAE offers civil aviation, military, and helicopter
training services in more than 45 locations worldwide and trains
approximately 100,000 crewmembers yearly. In addition, the CAE Oxford
Aviation Academy offers training to aspiring pilot cadets in 11
CAE-operated flight schools. CAE's business is diversified, ranging
from the sale of simulation products to providing comprehensive
services such as training and aviation services, integrated
enterprise solutions, in-service support and crew sourcing. The
company applies simulation expertise and operational experience to
help customers enhance safety, improve efficiency, maintain readiness
and solve challenging problems. CAE is leveraging its simulation
capabilities in new markets such as healthcare and mining.
www.cae.com 
You will find more information about the risks and uncertainties
associated with our business in the MD&A section of our annual report
and annual information form for the year ended March 31, 2012. These
documents have been filed with the Canadian securities commissions
and are available on our website ( www.cae.com), on SEDAR
(www.sedar.com) and a free copy is available upon request to CAE.
They have also been filed with the U.S. Securities and Exchange
Commission under Form 40-F and are available on EDGAR (www.sec.gov).
The forward-looking statements contained in this news release
represent our expectations as of May 16, 2013 and, accordingly, are
subject to change after this date. We do not update or revise
forward-looking information even if new information becomes available
unless legislation requires us to do so. You should not place undue
reliance on forward-looking statements. 
Notes 


 
(1)  Operating profit is non-GAAP measure that shows us how we have        
     performed before the effects of certain financing decisions and tax   
     structures. We track operating profit because we believe it makes it  
     easier to compare our performance with previous periods, and with     
     companies and industries that do not have the same capital structure  
     or tax laws.                                                          
                                                                           
(2)  Backlog is a non-GAAP measure that represents the expected value of   
     orders we have received but have not yet executed.                    
                                                                           
(3)  Revenue simulator equivalent unit (RSEU) is a financial measure we use
     to show the total average number of FFSs available to generate revenue
     during the period.                                                    
                                                                           
(4)  Free cash flow is a non-GAAP measure that shows us how much cash we   
     have available to build the business, repay debt and meet ongoing     
     financial obligations. We use it as an indicator of our financial     
     strength and liquidity. We calculate it by taking the net cash        
     generated by our continuing operating activities, subtracting         
     maintenance capital expenditures, other assets not related to growth  
     and dividends paid and adding proceeds from disposal of property,     
     plant and equipment.                                                  
                                                                           
(5)  Net debt is a non-GAAP measure we use to monitor how much debt we have
     after taking into account liquid assets such as cash and cash         
     equivalents. We use it as an indicator of our overall financial       
     position, and calculate it by taking our total long-term debt,        
     including the current portion of long-term debt, and subtracting cash 
     and cash equivalents.                                                 
                                                                           
                                                                           
                                                                           
                                                                            
Consolidated Statement of Financial Position                                
(Unaudited)                                                                 
As at March 31                                                              
(amounts in millions of Canadian dollars)                  2013        2012 
----------------------------------------------------------------------------
Assets                                                                      
Cash and cash equivalents                            $    293.2  $    287.3 
Accounts receivable                                       399.5       308.4 
Contracts in progress : assets                            247.3       245.8 
Inventories                                               186.6       153.1 
Prepayments                                                56.3        47.7 
Income taxes recoverable                                  141.9        95.5 
Derivative financial assets                                 9.0        10.3 
----------------------------------------------------------------------------
Total current assets                                 $  1,333.8  $  1,148.1 
Property, plant and equipment                           1,498.6     1,293.7 
Intangible assets                                         799.2       533.2 
Deferred tax assets                                        39.4        24.1 
Derivative financial assets                                 6.4         7.2 
Other assets                                              201.3       177.4 
----------------------------------------------------------------------------
Total assets                                         $  3,878.7  $  3,183.7 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Liabilities and equity                                                      
Accounts payable and accrued liabilities             $    695.5  $    597.6 
Provisions                                                 49.2        21.6 
Income taxes payable                                       13.7        10.9 
Contracts in progress : liabilities                       117.9       104.6 
Current portion of long-term debt                         113.0       136.0 
Derivative financial liabilities                           13.5        12.7 
----------------------------------------------------------------------------
Total current liabilities                            $  1,002.8  $    883.4 
Provisions                                                  8.3         6.0 
Long-term debt                                          1,097.0       685.6 
Royalty obligations                                       160.6       161.6 
Employee benefits obligations                             136.1       114.2 
Deferred gains and other non-current liabilities          194.6       186.0 
Deferred tax liabilities                                  131.6        91.8 
Derivative financial liabilities                           13.2        12.9 
----------------------------------------------------------------------------
Total liabilities                                    $  2,744.2  $  2,141.5 
----------------------------------------------------------------------------
Equity                                                                      
Share capital                                        $    471.7  $    454.5 
Contributed surplus                                        21.9        19.2 
Accumulated other comprehensive loss                      (16.6)       (9.8)
Retained earnings                                         625.7       558.0 
----------------------------------------------------------------------------
Equity attributable to equity holders of the Company $  1,102.7  $  1,021.9 
Non-controlling interests                                  31.8        20.3 
----------------------------------------------------------------------------
Total equity                                         $  1,134.5  $  1,042.2 
----------------------------------------------------------------------------
Total liabilities and equity                         $  3,878.7  $  3,183.7 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
 
Consolidated Income Statement                                               
(Unaudited)                                                                 
                                                                         
(amounts in millions of         Three months ended   Twelve months ended 
 Canadian dollars,                        March 31              March 31 
except per share amounts)          2013       2012       2013       2012 
-------------------------------------------------------------------------
Revenue                       $   587.9  $   506.7 $  2,104.5 $  1,821.2 
Cost of sales                     420.5      336.6    1,482.8    1,221.1 
-------------------------------------------------------------------------
Gross profit                  $   167.4  $   170.1 $    621.7 $    600.1 
Research and development                                                 
 expenses                          18.1       15.2       60.6       62.8 
Selling, general and                                                     
 administrative expenses           66.9       71.8      269.9      256.4 
Other gains - net                  (2.9)      (5.6)     (23.4)     (21.2)
Restructuring, integration and                                           
 acquisition costs                 13.7          -       68.9          - 
-------------------------------------------------------------------------
Operating profit              $    71.6  $    88.7 $    245.7 $    302.1 
-------------------------------------------------------------------------
Finance income                     (1.5)      (1.5)      (7.3)      (6.6)
Finance expense                    19.7       18.1       75.5       69.2 
-------------------------------------------------------------------------
Finance expense - net         $    18.2  $    16.6 $     68.2 $     62.6 
-------------------------------------------------------------------------
Earnings before income taxes  $    53.4  $    72.1 $    177.5 $    239.5 
Income tax expense                  7.0       18.4       35.1       57.5 
-------------------------------------------------------------------------
Net income                    $    46.4  $    53.7 $    142.4 $    182.0 
-------------------------------------------------------------------------
Attributable to:                                                         
Equity holders of the Company $    43.8  $    53.2 $    139.4 $    180.3 
Non-controlling interests           2.6        0.5        3.0        1.7 
-------------------------------------------------------------------------
                              $    46.4  $    53.7 $    142.4 $    182.0 
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Earnings per share from                                                  
 continuing operations                                                   
 attributable to equity                                                  
 holders of the Company                                                  
Basic and diluted             $    0.17  $    0.21 $     0.54 $     0.70 
-------------------------------------------------------------------------
-------------------------------------------------------------------------
                                                                            
                                                                            
Consolidated Statement of Comprehensive Income                              
                                                                            
                                         Three months         Twelve months 
(Unaudited)                                     ended                 ended 
                                             March 31              March 31 
(amounts in millions of Canadian                                            
 dollars)                             2013       2012       2013       2012 
----------------------------------------------------------------------------
Net income                        $   46.4  $    53.7  $   142.4  $   182.0 
----------------------------------------------------------------------------
Foreign currency translation                                                
Net currency translation                                                    
 difference on the translation of                                           
 financial statements of foreign                                            
 operations                       $   12.8  $    (5.1) $    10.6  $    13.5 
Net (losses) gains on certain                                               
 long-term debt denominated in                                              
 foreign currency and designated                                            
 as hedges of net investments in                                            
 foreign operations                   (8.6)       3.4       (8.8)      (3.9)
Income taxes                           1.2       (0.6)       0.7        0.8 
----------------------------------------------------------------------------
                                  $    5.4  $    (2.3) $     2.5  $    10.4 
----------------------------------------------------------------------------
Net changes in cash flow hedges                                             
Effective portion of changes in                                             
 fair value of cash flow hedges   $   (5.0) $     6.1  $    (2.5) $    (8.7)
Reclassifications to net income or                                          
 to the related non financial                                               
 assets or liabilities                (1.1)      (4.5)     (10.2)      (4.7)
Income taxes                           1.6       (0.2)       3.5        3.1 
----------------------------------------------------------------------------
                                  $   (4.5) $     1.4  $    (9.2) $   (10.3)
----------------------------------------------------------------------------
Defined benefit plan actuarial                                              
 losses                                                                     
Defined benefit plan actuarial                                              
 losses                           $  (10.1) $   (22.6) $   (30.8) $   (64.9)
Income taxes                           2.8        5.7        8.3       17.4 
----------------------------------------------------------------------------
                                  $   (7.3) $   (16.9) $   (22.5) $   (47.5)
----------------------------------------------------------------------------
Other comprehensive loss          $   (6.4) $   (17.8) $   (29.2) $   (47.4)
----------------------------------------------------------------------------
Total comprehensive income        $   40.0  $    35.9  $   113.2  $   134.6 
----------------------------------------------------------------------------
Attributable to:                                                            
Equity holders of the Company     $   37.4  $    35.4  $   110.1  $   132.8 
Non-controlling interests              2.6        0.5        3.1        1.8 
----------------------------------------------------------------------------
                                  $   40.0  $    35.9  $   113.2  $   134.6 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                                                                            
Consolidated Statement of Changes in Equity                                 
                                                                            
                                      Attributable to equity holders of the
(Unaudited)                                                         Company
                              ---------------------------------------------
Year ended March 31, 2013                                                  
(amounts in millions of                         Common shares              
 Canadian dollars,                  Number of          Stated  Contributed 
except number of shares)               shares           value      surplus 
---------------------------------------------------------------------------
Balances, beginning of year       258,266,295 $         454.5 $       19.2 
Net income                                  -               -            - 
Other comprehensive income                                                 
 (loss):                                                                   
  Foreign currency translation              -               -            - 
  Net changes in cash flow                                                 
   hedges                                   -               -            - 
  Defined benefit plan                                                     
   actuarial losses                         -               -            - 
---------------------------------------------------------------------------
Total comprehensive income                  - $             - $          - 
Stock options exercised               482,250             3.9            - 
Optional cash purchase                  1,683               -            - 
Stock dividends                     1,228,831            12.1            - 
Transfer upon exercise of                                                  
 stock options                              -             1.2         (1.2)
Share-based payments                        -               -          3.9 
Additions to non-controlling                                               
 interests                                  -               -            - 
Dividends                                   -               -            - 
---------------------------------------------------------------------------
Balances, end of year             259,979,059 $         471.7 $       21.9 
---------------------------------------------------------------------------
---------------------------------------------------------------------------
 
                                      Attributable to equity holders of the 
(Unaudited)                                                         Company 
                              ----------------------------------------------
Year ended March 31, 2013          Accumulated                              
(amounts in millions of                  other                              
 Canadian dollars,               comprehensive         Retained             
except number of shares)                  loss         earnings       Total 
----------------------------------------------------------------------------
Balances, beginning of year   $           (9.8) $         558.0  $  1,021.9 
Net income                                   -            139.4       139.4 
Other comprehensive income                                                  
 (loss):                                                                    
  Foreign currency translation             2.4                -         2.4 
  Net changes in cash flow                                                  
   hedges                                 (9.2)               -        (9.2)
  Defined benefit plan                                                      
   actuarial losses                          -            (22.5)      (22.5)
----------------------------------------------------------------------------
Total comprehensive income    $           (6.8) $         116.9  $    110.1 
Stock options exercised                      -                -         3.9 
Optional cash purchase                       -                -           - 
Stock dividends                              -            (12.1)          - 
Transfer upon exercise of                                                   
 stock options                               -                -           - 
Share-based payments                         -                -         3.9 
Additions to non-controlling                                                
 interests                                   -                -           - 
Dividends                                    -            (37.1)      (37.1)
----------------------------------------------------------------------------
Balances, end of year         $          (16.6) $         625.7  $  1,102.7 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
(Unaudited)                                                  
                                                             
Year ended March 31, 2013                                    
(amounts in millions of                  Non-                
 Canadian dollars,                controlling          Total 
except number of shares)           interests          equity 
-------------------------------------------------------------
Balances, beginning of year    $         20.3 $      1,042.2 
Net income                                3.0          142.4 
Other comprehensive income                                   
 (loss):                                                     
  Foreign currency translation            0.1            2.5 
  Net changes in cash flow                                   
   hedges                                   -           (9.2)
  Defined benefit plan                                       
   actuarial losses                         -          (22.5)
-------------------------------------------------------------
Total comprehensive income     $          3.1 $        113.2 
Stock options exercised                     -            3.9 
Optional cash purchase                      -              - 
Stock dividends                             -              - 
Transfer upon exercise of                                    
 stock options                              -              - 
Share-based payments                        -            3.9 
Additions to non-controlling                                 
 interests                                8.4            8.4 
Dividends                                   -          (37.1)
-------------------------------------------------------------
Balances, end of year          $         31.8 $      1,134.5 
-------------------------------------------------------------
-------------------------------------------------------------
                                                                          
                                                    Attributable to equity
(Unaudited)                                         holders of the Company
                             ---------------------------------------------
Year ended March 31, 2012                             Common              
(amounts in millions of                               shares              
 Canadian dollars,                 Number of          Stated  Contributed 
except number of shares)              shares           value      surplus 
--------------------------------------------------------------------------
Balances, beginning of year      256,964,756 $         440.7 $       17.1 
Net income                                 -               -            - 
Other comprehensive income                                                
 (loss):                                                                  
 Foreign currency translation              -               -            - 
 Net changes in cash flow                                                 
  hedges                                   -               -            - 
 Defined benefit plan                                                     
  actuarial losses                         -               -            - 
--------------------------------------------------------------------------
Total comprehensive income                 - $             - $          - 
Stock options exercised              538,600             4.4            - 
Optional cash purchase                   898               -            - 
Stock dividends                      762,041             7.8            - 
Transfer upon exercise of                                                 
 stock options                             -             1.6         (1.6)
Share-based payments                       -               -          3.7 
Dividends                                  -               -            - 
--------------------------------------------------------------------------
Balances, end of year            258,266,295 $         454.5 $       19.2 
--------------------------------------------------------------------------
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(Unaudited)                   Attributable to equity holders of the Company 
                             -----------------------------------------------
Year ended March 31, 2012          Accumulated                              
(amounts in millions of                  other                              
 Canadian dollars,               comprehensive         Retained             
except number of shares)                  loss         earnings       Total 
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Balances, beginning of year   $           (9.8) $         466.4  $    914.4 
Net income                                   -            180.3       180.3 
Other comprehensive income                                                  
 (loss):                                                                    
 Foreign currency translation             10.3                -        10.3 
 Net changes in cash flow                                                   
  hedges                                 (10.3)               -       (10.3)
 Defined benefit plan                                                       
  actuarial losses                           -            (47.5)      (47.5)
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Total comprehensive income    $              -  $         132.8  $    132.8 
Stock options exercised                      -                -         4.4 
Optional cash purchase                       -                -           - 
Stock dividends                              -             (7.8)          - 
Transfer upon exercise of                                                   
 stock options                               -                -           - 
Share-based payments                         -                -         3.7 
Dividends                                    -            (33.4)      (33.4)
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Balances, end of year         $           (9.8) $         558.0  $  1,021.9 
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(Unaudited)                                                 
                                                            
Year ended March 31, 2012                                   
(amounts in millions of                 Non-                
 Canadian dollars,               controlling          Total 
except number of shares)           interests         equity 
------------------------------------------------------------
Balances, beginning of year   $         18.5 $        932.9 
Net income                               1.7          182.0 
Other comprehensive income                                  
 (loss):                                                    
 Foreign currency translation            0.1           10.4 
 Net changes in cash flow                                   
  hedges                                   -          (10.3)
 Defined benefit plan                                       
  actuarial losses                         -          (47.5)
------------------------------------------------------------
Total comprehensive income    $          1.8 $        134.6 
Stock options exercised                    -            4.4 
Optional cash purchase                     -              - 
Stock dividends                            -              - 
Transfer upon exercise of                                   
 stock options                             -              - 
Share-based payments                       -            3.7 
Dividends                                  -          (33.4)
------------------------------------------------------------
Balances, end of year         $         20.3 $      1,042.2 
------------------------------------------------------------
------------------------------------------------------------
The total retained earnings and accumulated other comprehensive loss for the
year ended March 31, 2013 was $609.1 million (2012 - $548.2 million).       
                                                                            
                                                                            
Consolidated Statement of Cash Flows                                        
(Unaudited)                                                                 
Years ended March 31                                                        
(amounts in millions of Canadian dollars)                    2013      2012 
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Operating activities                                                        
Net income                                               $  142.4  $  182.0 
Adjustments to reconcile net income to cash flows from                      
 operating activities:                                                      
  Depreciation of property, plant and equipment             107.6      92.3 
  Amortization of intangible and other assets                49.7      33.5 
  Financing cost amortization                                 1.8       1.6 
  Deferred income taxes                                      28.1      36.4 
  Investment tax credits                                    (22.6)    (14.5)
  Share-based compensation                                   (4.2)      4.7 
  Defined benefit pension plans                              (9.3)    (13.1)
  Amortization of other non-current liabilities             (15.6)    (12.0)
  Other                                                     (12.1)     (5.3)
Changes in non-cash working capital                         (61.7)    (71.7)
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Net cash provided by operating activities                $  204.1  $  233.9 
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Investing activities                                                        
Business combinations, net of cash and cash equivalents                     
 acquired                                                $ (285.3) $ (126.0)
Joint ventures, net of cash and cash equivalents                            
 acquired                                                    (0.7)    (27.6)
Capital expenditures for property, plant and equipment     (155.8)   (165.7)
Proceeds from disposal of property, plant and equipment       8.9      34.4 
Capitalized development costs                               (49.6)    (42.8)
Enterprise resource planning (ERP) and other software       (19.4)    (17.3)
Other                                                        (3.0)      5.0 
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Net cash used in investing activities                    $ (504.9) $ (340.0)
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Financing activities                                                        
Net borrowing under revolving unsecured credit                              
 facilities                                              $   54.0  $   14.2 
Net effect of current financial assets program              (37.1)      4.9 
Proceeds from long-term debt, net of transaction costs      740.4     195.0 
Repayment of long-term debt                                (380.2)    (36.1)
Repayment of finance lease                                  (36.3)    (32.8)
Dividends paid                                              (37.1)    (33.4)
Common stock issuance                                         3.9       4.4 
Other                                                        (0.9)     (0.7)
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Net cash provided by financing activities                $  306.7  $  115.5 
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Effect of foreign exchange rate changes on cash and cash                    
 equivalents                                             $      -  $    1.5 
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Net increase in cash and cash equivalents                $    5.9  $   10.9 
Cash and cash equivalents, beginning of year                287.3     276.4 
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Cash and cash equivalents, end of year                   $  293.2  $  287.3 
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Supplemental information:                                                   
  Dividends received                                     $    2.4  $    4.7 
  Interest paid                                              53.6      49.4 
  Interest received                                           5.0       4.7 
  Income taxes paid                                          26.5      26.9 
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Contacts:
Investor relations:
Andrew Arnovitz, Vice President
Investor Relations and Strategy
(514) 734-5760
andrew.arnovitz@cae.com 
Media:
Nathalie Bourque, Vice President
Public Affairs and Global Communications
(514) 734-5788
nathalie.bourque@cae.com
 
 
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