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Strong first-half underpinned by breadth of portfolio revenue up 20% PBT* up 16% EPS* up 16%

Dr Julian Blogh Chairman Douglas Caster Chief Executive David Jeffcoat Finance Director. Ultra Electronics Interim Results 2008. 2008 Interim Overview. Revenue £m. Strong first-half underpinned by breadth of portfolio revenue up 20% PBT* up 16% EPS* up 16% DPS up 19%

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Strong first-half underpinned by breadth of portfolio revenue up 20% PBT* up 16% EPS* up 16%

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  1. Dr Julian Blogh Chairman Douglas Caster Chief Executive David Jeffcoat Finance Director

  2. Ultra Electronics Interim Results 2008 2008 Interim Overview Revenue £m • Strong first-half underpinned by breadth of portfolio • revenue up 20% • PBT* up 16% • EPS* up 16% • DPS up 19% • Organic revenue growth of 16% • Operating margin* maintained • Pace of acquisitions increased with four completed in period • Order book of £645m, maintaining a good level of visibility 412.9 377.0 192.9 180.7 231.9 2006 2007 2008 PBT* £m 61.1 54.9 26.2 23.8 30.4 2006 2007 2008 EPS* pence 65.4 58.4 * before amortisation of intangibles arising on acquisition and profit/loss on financial instruments 28.2 25.5 32.6 2006 2007 2008

  3. Financial Review

  4. Ultra Electronics Interim Results 2008 Profit & Loss * before amortisation of intangibles arising on acquisition** before amortisation of intangibles arising on acquisition and profit/loss on fair value movements on derivatives

  5. Ultra Electronics Interim Results 2008 Revenue Sector Destination Civilequipment14%(2007: 15%) UK37%(2007: 42%) Sonar19%(2007: 22%) Civil aircraftequipment9%(2007: 10%) Mainland Europe11%(2007: 9%) ROW8%(2007: 8%) Defenceequipment13% (2007: 13%) Battlespace IT34% (2007: 29%) Military aircraftequipment11%(2007: 11%) North America44%(2007: 41%)

  6. Ultra Electronics Interim Results 2008 Profit Progression 2008 OP* £32.5m Acquisitions+£1.8m Improved margins+£3.5m 2007 OP* £27.0m Currency effects-£1.5m Organic growth+£3.8m Higher R&D costs -£2.1m * before amortisation of intangibles arising on acquisition

  7. Ultra Electronics Interim Results 2008 Cash Flow Acquisition spending- £76m since July 2007- £45m in 2008 * before amortisation of intangibles arising on acquisition

  8. Operational Review

  9. Douglas Caster Chief Executive David Jeffcoat FinanceDirector Andy Hamment Marketing Director Bob Henry M&A Director Keith Thomson HR Director AIRCRAFT & VEHICLESYSTEMS TACTICAL & SONAR SYSTEMS INFORMATION & POWER SYSTEMS Alan Jan-Janin MD Aircraft & Vehicle Systems Phil Evans MD Sonar & Undersea Systems Rakesh Sharma MD Information & Power Systems Alan Barker President Tactical Systems Measurement Systems Wallingford, CT Command & Control Systems,Loudwater Manufacturing & Card Systems, Weymouth S&CS, Communication & Integrated Systems, Greenford S&CS, Sonar Systems Greenford Flightline Systems Rochester, NY Datel Preston SML Technologies Southampton Maritime Systems Dartmouth, NS PMES Rugeley Tactical Communication Systems, Montreal Precision Air Systems Staverton Ocean Systems Braintree, MA EMS Long Island, NY Advanced Tactical Systems Austin, TX UnderSea Sensor Systems Columbia City, IN DNE Technologies Wallingford, CT Controls Greenford & Cambridge ProLogic Fairmont, WV Airport Systems Manchester & Loudwater Electrics Cheltenham Criticom Lanham, MD Audiopack Cleveland, OH

  10. Financial results Revenue £58.9m +19% Profit £9.3m +21% Order book £195.1m +12% Aircraft & Vehicle SystemsOVERVIEW Market trends • Solid civil aerospace market sector • large and increasing backlogs • Continuing military aircraft build commitment • air superiority, ground attack and mobility • Focus on improved armoured vehicles • new build and upgrades 25% of Group sales 29% of Group OP Business highlights • Investment in Boeing 787 systems continues • support for flight test programme • Continuing development of JSF engine ice protection system • engine and lift fan systems • Satisfactory progress on five A400M development programmes • Increased sales of HiPPAG airborne compressor

  11. Aircraft & Vehicle SystemsSELECTED OPPORTUNITIES Programme Estimated date EstimatedUltra value Products $10m+ pa • Wing ice protection system • Proximity sensor electronics 2008 Boeing 787 production contract • Engine inlet ice protection $200m+ Joint Strike Fighter 2008+ • Ice protection • engine intake and lift fan • HiPPAG for weapons ejection 2008+ £15m+ • Electrical power management • Indirect vision system • Crew controls Armoured vehicle electronic upgrades Armoured vehicle electronic upgrades HiPPAG for USAF multi-purpose bomb rack $5m/$50m+ • HiPPAG for weapons ejection 2009 • Indirect vision system • Electrical power management • HUMS capability Warrior armoured vehicle turret upgrade £25m+ 2009 2010 Gulfstream G650 production contract $5m • Landing gear control system

  12. Financial results Revenue £66.0m +7% Profit £9.3m +2% Order book £134.5m +24% Ultra Electronics Interim Results 2008 INFORMATION & POWER SYSTEMS Information & Power SystemsOVERVIEW Market trends • Battlespace IT demand is strong • Increasing demand for power equipment • naval, transit and nuclear • Continuing investment in airport IT systems 28% of Group sales 29% of Group OP Business highlights • Success for broad range of ADSI-derived products • Strong demand for trackside power equipment • Production commitment for submarine nuclear reactor control and instrumentation • Airport IT system contracts around the world

  13. Ultra Electronics Interim Results 2008 INFORMATION & POWER SYSTEMS Information & Power SystemsACQUISITIONS ProLogic • Battlespace IT specialist • Complementary to Ultra’s ATS business • Moves Ultra up value chain • Well established with good growth • Pro-forma revenue for 2007: $53m Graytronics • Small, niche business • Marine intercom systems- civil and military • Complementary to Ultra SML’s naval RIB tracking • Pro-forma 2007 revenue: £1m

  14. Ultra Electronics Interim Results 2008 INFORMATION & POWER SYSTEMS Information & Power SystemsSELECTED OPPORTUNITIES Programme Estimated date EstimatedUltra value Products UK aircraft carriers 2008+ £15m+ • Power equipment • Signature management • Electro-optic sensors • Power equipment • Signature management • Reactor control equipment Astute boat 4 2008+ £20m • IT integration • Passenger, information and baggage processing Airport IT system upgrades and extensions 2008+ £20m+ pa Rolls-Royce RC&I production 2008/9 £20m • Naval nuclear reactor control system Civil nuclear equipment upgrades 2008/9 £20m+ • Surveys of existing systems • Outline designs • Nucleonic sensors and cables £20m • Trackside power equipment 2008/2011 Olympics transport infrastructureupgrade

  15. Financial results Revenue £107.0m +31% Profit £13.9m +36% Order book £315.6m +8% Ultra Electronics Interim Results 2008 TACTICAL & SONAR SYSTEMS Tactical & Sonar SystemsOVERVIEW Market trends • Increasing demand for battlespace IT equipment • Focus on upgrading capabilities of existing platforms • Increasing focus on improving ASW and torpedo defence 46% of Group sales 43% of Group OP Business highlights • Increased international demand for sonobuoys • Strong demand for higher capacity tactical radios • Typhoon ground attack capability using Litening pods • Good market acceptance of innovative PacketAssure

  16. Ultra Electronics Interim Results 2008 TACTICAL & SONAR SYSTEMS Tactical & Sonar SystemsACQUISITIONS Magneto Inductive Systems Ltd (MISL) • Unique, patented magneto inductive technology • Signalling and communications • Growth underpinned by US Army contract • Pro-forma revenue for 2007: C$10m Harris Acoustics • Underwater battlespace specialist • Acoustic transducers and arrays • Complementary to Ocean Systems • Pro-forma 2007 revenue: $10m

  17. Ultra Electronics Interim Results 2008 TACTICAL & SONAR SYSTEMS Tactical & Sonar SystemsSELECTED OPPORTUNITIES EstimatedUltra value Products Programme Estimated date 2008 £25m+ • Bow sonar • Towed array sonar • Networked sonobuoys Sonar system for Australian Air Warfare Destroyer New sonobuoy receivers for P-3 and P-8 aircraft $50m • Sonobuoy receivers 2008+ Harbour surveillance and security systems 2008/9 $20m • Command and control system • Surveillance equipment • Contingency planning tools High capacity tactical radios – export 2008/9 $20m+ • High capacity tactical radio systems • Data link equipment • Ground control stations Position on UK team complex weapons 2009+ £50m+ US and export torpedo defence systems • Torpedo detection • Countermeasure system 2009/10 £10m+

  18. Driving Long-Term Growth Investment for Growth Platforms, programmes and productsincluding: • Continuing B787; A400M • Gulfstream G650 • New variants of tactical radios • Next generation PacketAssure product • New ADSI-derived products Acquisitions: • Increased rate • More resource applied • Headroom available • Healthy pipeline Ultra’s Markets Existing markets: • Defence: continuing focus on growth in • battlespace IT • mobility • force protection • military aircraft • Civil: growth of affluent populations is driving • investment in airports • investment in mass transit systems New markets: • Civil: concerns about security of energy supply is driving nuclear power investment • Focus on stable, wealthy economies, including • Turkey • Australia • India • Middle East

  19. Summary & Outlook

  20. Summary & Outlook • Strong performance in first-half • Favourable market conditions for Ultra • Broad spread of niches and programmes underpins resilient performance • Increased pace of acquisitions • Strong balance sheet, capable of funding further acquisitions • £645m order book maintains good visibility Ultra’s Board has confidence in the continuing progress of the Group

  21. Ultra Electronics Interim Results 2008 APPENDIX 1 - Currency Effects US$14m @1.05 US$46m @1.91 Profit impact Transaction Translation US$ into C$ N/A -7% -£0.6m US$ into £ -5% -£1.3m Nil% £Nil C$ into £ 12% £0.4m N/A Total profit impact -£1.5m (-5%) Revenue translation impact £3.1m (1%)

  22. APPENDIX 2 – List of Acquisitions

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