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Editorial 2021

Dear ladies and gentlemen,

Buildings require a solid foundation, a robust design and a strong shell. Moreover, they also need to be planned with the future in mind. These actors are crucial to lasting durability in building architecture, and they are also a requirement for companies. In the past year, we have  worked intensively on our plans for the future. With the formal completion of the unbundling in early 2021, we have laid the foundation for re- engineering our company. The former RUAG Group was split into two new, independent companies and their IT infrastructure was unbundled.  This allows us to further develop RUAG as an independent company in the years to come and to make it fit for the future.

“Our RUAG”, which works for the security of Switzerland, is now a “building” in its own right. As is often the case for existing buildings,  however, we can only determine upon deeper analysis what is valuable and what needs renovating. What is most valuable are our employees  and the fact that they are deeply rooted in the dual education system. The basic training lays the foundation for good craftsmanship and the  active further development of competencies. RUAG will expand this successful model to its cooperation with universities.

At RUAG, we are therefore aware that optimum conditions for sustainable success can only be created if motivated, highly qualified and  forward-looking architects are involved. In the future, we will continue to make every effort to give our employees space for innovative  creativity and win over young people with passion and a future-oriented mentality for our company. The once again outstanding results of our apprentices at last year’s SwissSkills Championships show that we are on the right path in this respect.

RUAG is characterized by its ability to maintain systems for decades and modernize them with the latest technologies. We want to utilize our  extensive experience as technology partner of the Swiss Armed Forces to adapt to new capabilities and threat scenarios. Systems are  becoming increasingly interconnected, which demands new solutions, for example in the areas of autonomous equipment, communication  or cyber security. We are needed wherever Switzerland depends on sovereign security. Not only for the Swiss Armed Forces, but also for any  institutions relevant to security.

However, before we continue to work on our building, we urgently need to carry out necessary renovations. Cracks in the foundation or shaky  pillars are not a good basis for the future. Our infrastructure’s substance has been neglected in the past few years. Considerable efforts will  be needed to renovate our properties and test centers. New requirements will also have to be met for the Swiss Armed Forces’ major procurement projects. We see this as an opportunity, even though the financial aspects will be challenging.

A central pillar of our building is our strategic orientation. It provides direction for our employees, the owner and our partners. In the 2021  fiscal year, we worked intensively on our company strategy. We want to become an integrated service provider and agile technology partner  for Swiss sovereign security. Third-party business, which is still partly characterized by legacy projects, is a relevant element in our business mix. Furthermore, as a specific measure, we have launched our first concrete strategic initiatives. These initiatives are bundled in  the “RUAG Innovation Organization”, which will be formalized in 2022. The organization will primarily focus on technological innovations and  support RUAG in acquiring new customers, developing alternative business models, also in collaboration with partners, and establishing itself in other markets.

During the past fiscal year, our new strategy was directly impacted by the clarification of essential issues relating to security policy. In this  regard, we should highlight the decision of the Swiss citizens regarding the long-term future of the Swiss Air Force. The “yes” vote in the  referendum for a new fleet of fighter aircraft (NKF) and a new ground-based air defense with extended range (GBAD ER) will considerably change our activities in these areas – a major challenge that we will carefully prepare for.

Consistent digitalization is also one of the cornerstones of our new company. In interdisciplinary projects, we are working on digitalizing our  processes and systems and becoming more efficient and less complex as a company. As a result, our customers will benefit from shorter  lead times, greater transparency and faster decision-making processes in the future.

Another component of a building is its shell, which creates a good climate. In particular, this involves meeting the high demands put on our  social responsibility. This social responsibility includes complying with obligations under international law, making contributions to  witzerland as an education and research location, observing regional politics, promoting diversity and achieving environmental objectives.

Dear ladies and gentlemen. During the past fiscal year, we at RUAG have been working intensively on the basic structure of our new company.  We are convinced that this work will pay off and lead RUAG into a successful future.

Nicolas Perrin, Chairman of the Board of Directors RUAG MRO Holding Ltd

Peter E. Bodmer, CEO a.i. RUAG MRO Holding Ltd