CAE reports first quarter financial results for fiscal year 2014

CAE reports first quarter financial results for fiscal year 2014 
- 15 full-flight simulator (FFS) sales in Q1 and eight more announced
today for 23 year to date  
- Raised annual FFS sales outlook to record 40 units 
MONTREAL, CANADA -- (Marketwired) -- 08/08/13 -- (NYSE:CAE)(TSX:CAE)
- CAE today reported financial results for the first quarter ended
June 30, 2013. Net income attributable to equity holders was $45.6
million ($0.18 per share) this quarter, compared to $21.5 million
($0.08 per share) last year. All financial information is in Canadian
dollars. 
The quarter included a one-time tax benefit of $11.0 million and
severance costs of $2.8 million (after-tax), excluding which,
earnings per share would have been $0.03 lower. Excluding
restructuring, integration and acquisition costs last year, it was
$46.9 million ($0.18 per share). 
Revenue for the quarter was $530.4 million, 15% higher than $462.2
million in the first quarter last year.  
"We maintained our market leadership this quarter with strong
full-flight simulator sales in Civil and higher orders in Military
than last year," said Marc Parent, CAE's President and Chief
Executive Officer. "In Civil, despite disappointing margin
performance this quarter, 23 FFS sales fiscal year to date give us a
strong start and we expect to reach a record of 40 units by March 31.
The Civil team, led by its new group president, Nick Leontidis, is
focused on the execution of its plan and we expect the combined Civil
operating margin to reflect the underlying strength of the business
by reaching high-teens percentages in the second half of the fiscal
year. In Military, we sustained revenue and grew orders over last
year which demonstrates our resiliency in a challenging defence
budget environment. New Core Markets continued to perform well."  
Summary of consolidated results 


 
(amounts in millions, except                                                
 operating margins)              Q1-2014  Q4-2013  Q3-2013  Q2-2013  Q1-2013
----------------------------------------------------------------------------
Revenue                       $    530.4    565.6    500.9    506.5    462.2
Operating profit (1)          $     62.8     66.9     59.8     64.0     43.3
As a % of revenue             %     11.8     11.8     11.9     12.6      9.4
Net Income                    $     45.4     45.7     37.2     35.9     21.9
Net income attributable to                                                  
 the equity holders of the                                                  
 Company                      $     45.6     43.1     37.5     35.6     21.5
Backlog (2)                   $  3,714.5  3,717.8  3,462.8  3,561.3  3,517.6
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Civil segments  
Revenue for our combined Civil segments increased 27% in the first
quarter to $301.8 million compared to $238.4 million last year. First
quarter operating income was $37.6 million (12.5% of revenue)
compared to $46.9 million (19.7% of revenue) last year.  
We received 15 FFS orders in the first quarter and we expect to sell
a record 40 FFSs for the year. During the quarter we signed a 10-year
agreement with Etihad Airways for seven FFSs and related training
devices for the Airbus A320, A350, A380 and Boeing B787 airliners, as
well as long term services to support Etihad's expanding training
base in Abu Dhabi. We received $313.5 million in combined civil
segment orders this quarter for a book-to-sales ratio of 1.04x. The
ratio for the trailing 12 months was 1.19x. First quarter Civil
backlog was $1.754 billion, and we had an additional $310.6 million
backlog related to our joint ventures, no longer included in the
total under IFRS. 
CAE today announced the sale of eight FFSs and a 15-year services
agreement for approximately $210 million at list prices to an
undisclosed customer. This brings CAE's year-to-date total FFS sales
to 23. 
Training & Services/Civil (TS/C) 


 
(amounts in millions except                                                 
 operating margins, SEU and                                                 
 FFSs deployed)                  Q1-2014  Q4-2013  Q3-2013  Q2-2013  Q1-2013
----------------------------------------------------------------------------
Revenue                       $    178.3    176.1    169.0    166.8    147.9
Segment operating income      $     17.5     24.9     24.2     22.1     29.5
Operating margins             %      9.8     14.1     14.3     13.2     19.9
Backlog                       $  1,300.0  1,311.6  1,065.8  1,092.9  1,118.4
SEU(3)                               190      187      186      187      164
FFSs deployed                        230      227      222      218      216
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Simulation Products/Civil (SP/C) 


 
(amounts in millions except                                                 
 operating margins)              Q1-2014  Q4-2013  Q3-2013  Q2-2013  Q1-2013
----------------------------------------------------------------------------
Revenue                       $    123.5    143.4    104.4    118.5     90.5
Segment operating income      $     20.1     25.8     21.9     23.1     17.4
Operating margins             %     16.3     18.0     21.0     19.5     19.2
Backlog                       $    454.4    411.0    393.3    427.4    394.2
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Military segments  
Revenue for our combined Military segments increased 1% in the first
quarter to $198.8 million compared to $197.7 million last year.
Combined Military operating income was $23.6 million (11.9% of
revenue) for the quarter, compared to $27.7 million (14.0% of
revenue) last year.  
We booked orders during the quarter in both established and emerging
defence markets including the sale of three Hawk Mk127 fast jet full
mission simulators for the Royal Australian Air Force and an AW139
helicopter simulator for Coptersafety in Finland. Under U.S. foreign
military sales programs, we were awarded a contract to expand a
training facility for the Kuwait Air Force, and we received a
contract for KC-130R Hercules training services for the Japan
Maritime Self Defense Force. We signed two strategically important
memorandums of understanding (MOU) with OEMs during the quarter. The
first with Lockheed Martin, which would have CAE become the preferred
provider of Canadian F-35 training support, training systems
integration, operations and maintenance should Canada ultimately
select the F-35. We also signed an MOU with General Atomics to pursue
international opportunities for CAE to offer its simulation and
training systems for the Predator family of remotely piloted
aircraft.  
We received $153.5 million in combined military segment orders this
quarter, representing a book-to-sales ratio of 0.77x. The ratio for
the trailing 12 months was 0.95x. First quarter Military backlog was
$1.96 billion, and we had an additional $257.9 million of unfunded
backlog and another $125.6 million from our joint ventures. 
In addition to the Hawk Mk127 full mission simulator sales for
Australia announced today, CAE also announced a contract for the U.S.
Air Force (USAF) in our second quarter with an expected value of
approximately $100 million over a five-year period. This contract
entrusts CAE to train its total population of about 1,500 pilot and
sensor operator crews of the Predator and Reaper remotely piloted
vehicles. CAE will provide classroom, simulator and live flying
instruction at USAF bases in New Mexico, Nevada, California, and New
York.  
Simulation Products/Military (SP/M) 


 
(amounts in millions except                                                 
 operating margins)              Q1-2014  Q4-2013  Q3-2013  Q2-2013  Q1-2013
----------------------------------------------------------------------------
Revenue                       $    137.8    153.1    140.1    132.4    136.9
Segment operating income      $     16.5     19.4     19.3     21.1     20.2
Operating margins             %     12.0     12.7     13.8     15.9     14.8
Backlog                       $    673.4    688.7    729.2    722.6    754.9
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Training & Services /Military (TS/M) 


 
(amounts in millions except                                                 
 operating margins)              Q1-2014  Q4-2013  Q3-2013  Q2-2013  Q1-2013
----------------------------------------------------------------------------
Revenue                       $     61.0     64.0     58.7     60.5     60.8
Segment operating income      $      7.1      8.8      6.1      5.0      7.5
Operating margins             %     11.6     13.8     10.4      8.3     12.3
Backlog                       $  1,286.7  1,306.5  1,274.5  1,318.4  1,250.1
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New Core Markets  
Revenue in New Core Markets was $29.8 million for the quarter, up 14%
from $26.1 million last year. Operating income was $1.6 million, up
129% compared to $0.7 million last year.  
In CAE Healthcare, we have been successfully leveraging CAE's global
reach. We signed an agreement with a private hospital group in Brazil
to establish a training centre, utilizing our patient simulators and
centre management system. We also sold our centre management systems
to a public research university in the U.S, and a private hospital
group in Turkey.  
In CAE Mining, we sold our resource modeling and mine planning
software to customers in Russia, India and Mexico. We also announced
the delivery of our first turnkey mining training solution, based on
aviation standards and involving CAE Mining Terra simulators and
e-learning courseware, to Fresnillo, the world's largest silver
producer.  
New Core Markets (NCM) 


 
(amounts in millions except                                                 
 operating margins)              Q1-2014  Q4-2013  Q3-2013  Q2-2013  Q1-2013
----------------------------------------------------------------------------
Revenue                       $     29.8     29.0     28.7     28.3     26.1
Segment operating income      $      1.6      1.8      1.7      2.2      0.7
Operating margins             %      5.4      6.2      5.9      7.8      2.7
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Additional financial highlights  
Income taxes this quarter were $0.3 million representing an effective
tax rate of 1%, compared to 19% last year. The decrease in the
effective tax rate from last quarter was mainly due to a favorable
decision by the Federal Court of Appeal of Canada, rendered April 17,
2013, with respect to the tax treatment of the depreciation and sale
of simulators in Canada, as well as a change in the mix of income
from various jurisdictions. Excluding the effect of this one-time
item in the quarter, the income tax expense would have been $11.3
million.  
Free cash flow(4) was negative $11.5 million this quarter. The
decrease from last quarter was mainly attributable to unfavourable
changes in non-cash working capital and higher maintenance capital
expenditures. The unfavourable changes in non-cash working capital,
as we normally see in the first quarter of the fiscal year, are
mainly due to a decrease in our accounts payable and accrued
liabilities. Free cash flow was $96.5 million higher than the first
quarter last year mainly due to an increase in cash provided by
operating activities and favourable changes in non-cash working
capital. 
Capital expenditures totaled $29.9 million this quarter with $22.7
million for growth and $7.2 million for maintenance. 
Net debt(5) was $897.8 million as at June 30, 2013, compared with
$813.4 million as at March 31, 2013. Our net debt to total
capitalization ratio remained stable at 42%. 
CAE will pay a dividend of $0.05 per share effective September 30,
2013 to shareholders of record at the close of business on September
16, 2013. 
Effective April 1, 2013, we implemented the new IFRS 11, Joint
Arrangements and the amended IAS 19, Employee Benefits. Certain
comparative figures provided for each quarter of the year ended March
31, 2013 have been restated to reflect the adoption of these
accounting standards. Tables summarizing the impact of the changes in
the accounting of our joint ventures can be found on the investor
page of our website at www.cae.com/investors. 
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 June 30,
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 Q1 FY2014  
CAE will host a conference call focusing on fiscal year 2014 first
quarter 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, 2013. 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 August 8, 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)  Simulator equivalent unit (SEU) is a financial measure we use to show  
     the total average number of FFSs available to generate earnings 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 the disposal of property,  
     plant and equipment, dividends received from equity accounted investees
     and proceeds, net of payments, from equity accounted investees.        
                                                                            
(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 Interim Financial Statements                                   
                                                                            
Consolidated Statement of Financial Position                                
                                                                            
(Unaudited)                                  June 30   March 31     April 1 
(amounts in millions of Canadian dollars)       2013       2013        2012 
----------------------------------------------------------------------------
                                                       Restated    Restated 
Assets                                                                      
Cash and cash equivalents                  $   258.9  $   260.0   $   254.7 
Accounts receivable                            419.8      401.4       302.3 
Contracts in progress : assets                 276.9      265.6       259.8 
Inventories                                    185.9      176.2       146.9 
Prepayments                                     60.6       53.5        46.1 
Income taxes recoverable                        26.4      141.9        95.5 
Derivative financial assets                      7.6        9.0        10.3 
----------------------------------------------------------------------------
Total current assets                       $ 1,236.1  $ 1,307.6   $ 1,115.6 
Property, plant and equipment                1,180.8    1,142.8       993.2 
Intangible assets                              815.7      794.4       527.9 
Investment in equity accounted investees       207.4      196.9       172.9 
Deferred tax assets                             32.4       31.3        16.9 
Derivative financial assets                      6.7        6.4         7.2 
Other assets                                   358.8      211.9       195.2 
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Total assets                               $ 3,837.9  $ 3,691.3   $ 3,028.9 
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Liabilities and equity                                                      
Accounts payable and accrued liabilities   $   611.1  $   644.2   $   556.2 
Provisions                                      48.2       49.0        21.6 
Income taxes payable                            11.6       10.0         9.4 
Contracts in progress : liabilities            120.5      122.3       110.4 
Current portion of long-term debt               42.4       70.6       119.3 
Derivative financial liabilities                21.2       10.3         8.9 
----------------------------------------------------------------------------
Total current liabilities                  $   855.0  $   906.4   $   825.8 
Provisions                                       6.6        7.9         5.5 
Long-term debt                               1,114.3    1,002.8       588.4 
Royalty obligations                            162.9      160.6       161.6 
Employee benefits obligations                  115.7      136.1       114.3 
Deferred gains and other non-current                                        
 liabilities                                   196.3      191.4       182.5 
Deferred tax liabilities                       141.6      129.9        90.0 
Derivative financial liabilities                10.0        9.8         9.4 
----------------------------------------------------------------------------
Total liabilities                          $ 2,602.4  $ 2,544.9   $ 1,977.5 
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Equity                                                                      
Share capital                              $   478.9  $   471.7   $   454.5 
Contributed surplus                             22.3       21.9        19.2 
Accumulated other comprehensive income                                      
 (loss)                                         19.7      (12.0)       (6.0)
Retained earnings                              683.0      633.0       563.4 
----------------------------------------------------------------------------
Equity attributable to equity holders of                                    
 the Company                               $ 1,203.9  $ 1,114.6   $ 1,031.1 
Non-controlling interests                       31.6       31.8        20.3 
----------------------------------------------------------------------------
Total equity                               $ 1,235.5  $ 1,146.4   $ 1,051.4 
----------------------------------------------------------------------------
Total liabilities and equity               $ 3,837.9  $ 3,691.3   $ 3,028.9 
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Consolidated Interim Financial Statements                                   
                                                                            
Consolidated Income Statement                                               
                                                                            
(Unaudited)                                                                 
three months ended June 30                                                  
(amounts in millions of Canadian dollars,                                   
 except per share amounts)                             2013            2012 
----------------------------------------------------------------------------
                                                                   Restated 
Revenue                                         $     530.4     $     462.2 
Cost of sales                                         382.9           312.3 
----------------------------------------------------------------------------
Gross profit                                    $     147.5     $     149.9 
Research and development expenses                      17.5            13.9 
Selling, general and administrative expenses           75.3            67.2 
Other gains - net                                      (5.2)           (0.8)
After tax share in profit of equity                                         
 accounted investees                                   (2.9)           (5.7)
Restructuring, integration and acquisition                                  
 costs                                                    -            32.0 
----------------------------------------------------------------------------
Operating profit                                $      62.8     $      43.3 
----------------------------------------------------------------------------
Finance income                                         (2.8)           (2.0)
Finance expense                                        19.9            18.1 
----------------------------------------------------------------------------
Finance expense - net                           $      17.1     $      16.1 
----------------------------------------------------------------------------
Earnings before income taxes                    $      45.7     $      27.2 
Income tax expense                                      0.3             5.3 
----------------------------------------------------------------------------
Net income                                      $      45.4     $      21.9 
----------------------------------------------------------------------------
Attributable to:                                                            
Equity holders of the Company                   $      45.6     $      21.5 
Non-controlling interests                              (0.2)            0.4 
----------------------------------------------------------------------------
                                                $      45.4     $      21.9 
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Earnings per share from continuing                                          
 operations attributable to equity holders                                  
 of the Company                                                             
Basic and diluted                               $      0.18     $      0.08 
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Consolidated Interim Financial Statements                                   
                                                                            
Consolidated Statement of Comprehensive Income                              
                                                                            
(Unaudited)                                                                 
three months ended June 30                                                  
(amounts in millions of Canadian dollars)                  2013        2012 
----------------------------------------------------------------------------
                                                                   Restated 
Net income                                            $    45.4   $    21.9 
----------------------------------------------------------------------------
Items that may be reclassified to net income                                
  Foreign currency translation                                              
  Net currency translation difference on the                                
   translation of financial statements of foreign                           
   operations                                         $    48.4   $     0.6 
  Net losses on certain long-term debt denominated                          
   in foreign currency and designated as hedges of                          
   net investments in foreign operations                  (14.9)       (2.5)
  Income taxes                 
                             1.7           - 
  Share in foreign currency translation difference                          
   of equity accounted investees                            7.0         2.3 
----------------------------------------------------------------------------
                                                      $    42.2   $     0.4 
----------------------------------------------------------------------------
Net changes in cash flow hedges                                             
Effective portion of changes in fair value of cash                          
 flow hedges                                          $   (15.4)  $    (5.1)
Reclassifications to net income or to related non-                          
 financial assets or liabilities                            2.5        (0.7)
Income taxes                                                3.4         1.5 
After tax share in net changes in fair value of cash                        
 flow hedges of equity accounted investees                 (1.0)       (1.0)
----------------------------------------------------------------------------
                                                      $   (10.5)  $    (5.3)
----------------------------------------------------------------------------
Items that are never reclassified to net income                             
  Defined benefit plan actuarial gains (losses)                             
  Defined benefit plan actuarial gains (losses)       $    23.7   $    (4.8)
  Income taxes                                             (6.3)        1.3 
----------------------------------------------------------------------------
                                                      $    17.4   $    (3.5)
----------------------------------------------------------------------------
Other comprehensive income (loss)                     $    49.1   $    (8.4)
----------------------------------------------------------------------------
Total comprehensive income                            $    94.5   $    13.5 
----------------------------------------------------------------------------
Attributable to:                                                            
Equity holders of the Company                         $    94.7   $    13.0 
Non-controlling interests                                  (0.2)        0.5 
----------------------------------------------------------------------------
                                                      $    94.5   $    13.5 
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Consolidated Interim Financial Statements    
                                             
Consolidated Statement of Changes in Equity  
                                                                            
                               Attributable to equity holders of the Company
                        ----------------------------------------------------
                                 Common shares                              
(Unaudited)                                                                 
three months ended June                                                     
 30, 2013                                                                   
(amounts in millions of                                         Accumulated 
 Canadian dollars,            Number                                  other 
 except number of                 of    Stated  Contributed   comprehensive 
 shares)                      shares     value      surplus          income 
----------------------------------------------------------------------------
Balances, beginning of                                                      
 period - restated       259,979,059 $   471.7 $       21.9  $        (12.0)
Net income                         -         -            -               - 
Other comprehensive                                                         
 income (loss):                                                             
  Foreign currency                                                          
   translation                     -         -            -            42.2 
  Net changes in cash                                                       
   flow hedges                     -         -            -           (10.5)
  Defined benefit plan                                                      
   actuarial gains                 -         -            -               - 
----------------------------------------------------------------------------
Total comprehensive                                                         
 income (loss)                     - $       - $          -  $         31.7 
Stock options exercised      446,928       3.5            -               - 
Optional cash purchase           325         -            -               - 
Stock dividends              262,311       2.8            -               - 
Transfer upon exercise                                                      
 of stock options                  -       0.9         (0.9)              - 
Share-based payments               -         -          1.3               - 
Dividends                          -         -            -               - 
----------------------------------------------------------------------------
Balances, end of period  260,688,623 $   478.9 $       22.3  $         19.7 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
 
                                                                            
                                 Attributable to                            
                           equity holders of the                            
                                         Company                            
                        ------------------------                            
                                                                            
(Unaudited)                                                                 
three months ended June                                                     
 30, 2013                                                                   
(amounts in millions of                                                     
 Canadian dollars,                                        Non-              
 except number of          Retained                controlling        Total 
 shares)                   earnings        Total     interests       equity 
----------------------------------------------------------------------------
Balances, beginning of                                                      
 period - restated       $    633.0  $   1,114.6  $       31.8  $   1,146.4 
Net income                     45.6         45.6          (0.2)        45.4 
Other comprehensive                                                         
 income (loss):                                                             
  Foreign currency                                                          
   translation                    -         42.2             -         42.2 
  Net changes in cash                                                       
   flow hedges                    -        (10.5)            -        (10.5)
  Defined benefit plan                                                      
   actuarial gains             17.4         17.4             -         17.4 
----------------------------------------------------------------------------
Total comprehensive                                                         
 income (loss)           $     63.0  $      94.7  $       (0.2) $      94.5 
Stock options exercised           -          3.5             -          3.5 
Optional cash purchase            -            -             
-            - 
Stock dividends                (2.8)           -             -            - 
Transfer upon exercise                                                      
 of stock options                 -            -             -            - 
Share-based payments              -          1.3             -          1.3 
Dividends                     (10.2)       (10.2)            -        (10.2)
----------------------------------------------------------------------------
Balances, end of period  $    683.0 $    1,203.9  $       31.6  $   1,235.5 
----------------------------------------------------------------------------
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                               Attributable to equity holders of the Company
                        ----------------------------------------------------
                                 Common shares                              
(Unaudited)                                                                 
three months ended June                                                     
 30, 2012                                                                   
(amounts in millions of                                         Accumulated 
 Canadian dollars,            Number                                  other 
 except number of                 of    Stated  Contributed   comprehensive 
 shares)                      shares     value      surplus            loss 
----------------------------------------------------------------------------
Balances, beginning of                                                      
 period - restated       258,266,295 $   454.5 $       19.2  $         (6.0)
Net income                         -         -            -               - 
Other comprehensive                                                         
 income (loss) :                                                            
  Foreign currency                                                          
   translation                     -         -            -             0.3 
  Net changes in cash                                                       
   flow hedges                     -         -            -            (5.3)
  Defined benefit plan                                                      
   actuarial losses                -         -            -               - 
----------------------------------------------------------------------------
Total comprehensive                                                         
 (loss) income                     - $       - $          -  $         (5.0)
Stock options exercised      217,875       1.8            -               - 
Optional cash purchase           516         -            -               - 
Stock dividends              224,245       2.1            -               - 
Transfer upon exercise                                                      
 of stock options                  -       0.6         (0.6)              - 
Share-based payments               -         -          1.5               - 
Acquisition of non-                                                         
 controlling interests             -         -            -               - 
Dividends                          -         -            -               - 
----------------------------------------------------------------------------
Balances, end of period                                                     
 - restated              258,708,931 $   459.0 $       20.1  $        (11.0)
----------------------------------------------------------------------------
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                          Attributable to equity                            
                          holders of the Company                            
                        ------------------------                            
                                                                            
(Unaudited)                                                                 
three months ended June                                                     
 30, 2012                                                                   
(amounts in millions of                                                     
 Canadian dollars,                                         Non-             
 except number of          Retained                 controlling       Total 
 shares)                   earnings        Total      interests      equity 
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Balances, beginning of                                                      
 period - restated       $    563.4  $   1,031.1  $        20.3 $   1,051.4 
Net income                     21.5         21.5            0.4        21.9 
Other comprehensive                                                         
 income (loss) :                                                            
  Foreign currency                                                          
   translation                    -          0.3            0.1         0.4 
  Net changes in cash                                                       
   flow hedges                    -         (5.3)             -        (5.3)
  Defined benefit plan                                                      
   actuarial losses            (3.5)        (3.5)             -        (3.5)
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Total comprehensive                                                         
 (loss) income           $     18.0  $      13.0  $         0.5 $      13.5 
Stock options exercised           -          1.8              -         1.8 
Optional cash purchase            -            -              -           - 
Stock dividends                (2.1)           -              -           - 
Transfer upon exercise                                                      
 of stock options                 -            -              -           - 
Share-based payments              -          1.5              -         1.5 
Acquisition of non-                                                         
 controlling interests            -            -            0.8         0.8 
Dividends                      (8.2)        (8.2)             -        (8.2)
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Balances, end of period                                                     
 - restated              $    571.1  $   1,039.2  $        21.6 $   1,060.8 
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The total of retained earnings and accumulated other comprehensive
(loss) income for the three months ended June 30, 2013 was $702.7
million (2012 - $560.1 million). 


 
Consolidated Interim Financial Statements                                   
                                                                            
Consolidated Statement of Cash Flows                                        
                                                                            
(Unaudited)                                                                 
three months ended June 30                                                  
(amounts in millions of Canadian dollars)                  2013        2012 
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                                                                   Restated 
Operating activities                                                        
Net income                                            $    45.4   $    21.9 
Adjustments to reconcile net income to cash flows                           
 from operating activities:                                                 
  Depreciation of property, plant and equipment            24.8        21.8 
  Amortization of intangible and other assets              14.9        10.0 
  Financing cost amortization                               0.4         0.5 
  After tax share in profit of equity accounted                             
   investees                                               (2.9)       (5.7)
  Deferred income taxes                                     8.0         5.5 
  Investment tax credits                                   (4.2)       (4.9)
  Share-based compensation                                  0.2        (3.9)
  Defined benefit pension plans                             2.6           - 
  Amortization of other non-current liabilities            (4.3)       (3.4)
  Other                                                     0.7        (4.0)
Changes in non-cash working capital                       (69.0)     (120.1)
----------------------------------------------------------------------------
Net cash provided by (used in) operating activities   $    16.6   $   (82.3)
----------------------------------------------------------------------------
Investing activities                                                        
Business combinations, net of cash and cash                                 
 equivalents acquired                                 $       -   $  (264.4)
Net proceeds (payments) from equity accounted                               
 investees                                                  0.5        (2.4)
Capital expenditures for property, plant and                                
 equipment                                                (29.9)      (34.5)
Proceeds from disposal of property, plant and                               
 equipment                                                  1.7           - 
Capitalized development costs                             (12.1)      (12.4)
Enterprise resource planning (ERP) and other                                
 software                                                  (2.1)       (4.5)
Other                                                     (10.8)        0.8 
----------------------------------------------------------------------------
Net cash used in investing activities                 $   (52.7)  $  (317.4)
----------------------------------------------------------------------------
Financing activities                                                        
Net change in restricted cash                         $   (18.1)  $       - 
Net effect of current financial assets program                -       (16.7)
Proceeds from borrowing under revolving unsecured                           
 credit facilities                                        189.3       200.0 
Repayment of borrowing under revolving unsecured                            
 credit facilities                                       (131.1)      (75.0)
Proceeds from long-term debt, net of transaction                            
 costs                                                     25.6       317.4 
Repayment of long-term debt                               (24.5)      (37.9)
Repayment of finance lease                                 (4.4)       (3.7)
Dividends paid                                            (10.2)       (8.2)
Common stock issuance                                       3.5         1.8 
Other                                                         -        (1.3)
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Net cash provided by financing activities             $    30.1   $   376.4 
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Effect of foreign exchange rate changes on cash and                         
 cash equivalents                                     $     4.9   $     0.1 
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Net decrease in cash and cash equivalents             $    (1.1)  $   (23.2)
Cash and cash equivalents, beginning of period            260.0       254.7 
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Cash and cash equivalents, end of period              $   258.9   $   231.5 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Supplemental information:                                                   
  Dividends received                                  $     0.6   $     2.0 
  Interest paid                                            11.2        13.9 
  Interest received                                         1.8         2.0 
  Income taxes paid                                         4.0         6.2 
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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