Financial and Technical Glossary

Altitude Test Facility

Altitude test facilities are used to test engines on the ground under simulated conditions of flight altitude. Every newly developed engine undergoes a series of tests on an altitude test facility before actual flight testing begins.

ASE series

The ASE series is a family of gas turbines in the 0.5 to 15 MW power category initially produced by former AlliedSignal. When AlliedSignal and Honeywell merged, production moved to Honeywell and later to Vericor Power Systems, then a 50/50 joint venture of Honeywell and MTU Aero Engines. When Honeywell exited Vericor, all rights to the ASE series were transferred to MTU.

Avio

The Italian engine manufacturer Avio has its origins in former FiatAvio, the aircraft engine division of the Italian Fiat Group.

Cashflow

Cashflow refers to the internal financing potential of a company.

CEO

CEO stands for Chief Executive Officer.

CF34

The main applications for the CF34 engine are 50-, 70- or 100-seat business jets and regional jets. Maintenance for the CF34 is provided by MTU Maintenance Berlin- Brandenburg.

CF6

Engines of General Electric’s CF6 family power medium- and long-haul Airbus and Boeing aircraft. For the CF6, MTU manufactures parts of the high-pressure turbine and the compressor. For this engine, which has been in service for over 25 years, the maintenance and spare parts business is becoming increasingly important.

CF6-50

Engine of the CF6 family.

CF6-80

Engine of the CF6 family.

CFM56

CFM56 engines power the twin-jet Airbus A320 family, the long-haul A340 jet, and the standard and new-generation Boeing 737. The CFM56 is the world’s best-selling engine for commercial jetliners. MTU concentrates on maintenance for a number of CFM56 variants.

CFO

CFO stands for Chief Financial Officer.

Clean Demonstrator

Clean (component validator for environmentally friendly aero engine) is a European technology demonstrator program under the direction of MTU Aero Engines. Its special feature: The concept is based on geared fan technology and includes a heat exchanger. It affords substantial fuel savings as well as significant noise reductions.

Combustor

In the combustor, the air coming from the compressor is mixed with fuel and burned. This creates extremely high pressures and very high temperatures of well over 2,000° C. All the hazardous substances which the engine emits are produced in the combustor. Therefore, an attempt is made today to lower the level of these hazardous substances – especially of nitrogen oxides – by changing the injection and mixing concepts in the combustor. Because of the high temperatures, the combustors are provided with special thermal protection.

Compressor

The compressor consists of several stages of bladed compressor disks that rotate at very high speeds between stationary guide vanes. Large volumes of air are ingested and compressed greatly before being passed into the combustor. To achieve the compression ratio of over 30:1 of current engines, two different types of compressors are used: the lowpressure and the high-pressure compressor. These compressors are driven at different speeds by the associated turbines via concentric shafts.

Control and Monitoring Systems

The control system comprises the individual devices used to monitor the engine and to control the fuel supply system, actuation of guide vanes and nozzles, bleed-air system and lubrication system, as well as the necessary sensors for engine speed, pressure, and temperature.

Cooperative Model

Under the Cooperative Model, the maintenance activities for aircraft engines operated by the German Armed Forces (Bundeswehr) are pooled under the umbrella of industry. The Bundeswehr is closely involved in all procedures, with airmen and MTU personnel working shoulder-to-shoulder.

Corporate Governance

Corporate governance refers to the rules of good, value-oriented corporate management. The principles of corporate governance are aimed at promoting trust in the company among investors, customers, employees, and the general public.

D&O Insurance

D&O insurance covers liability risks resulting from the execution of professional or official responsibilities in a company (= director and officer liability insurance).

DECMU

The DECMU (digital engine control and monitoring unit) is an engine subsystem for the complete digital control and monitoring of the engine. Normally, there are two separate units for these two functions. In the DECMU, they are integrated into one single unit.

EASA

EASA (European Aviation Safety Agency) is the European approval agency and has the same approval authority for all EU member states as the FAA has in the U.S.

EBIT

Earnings before interest and taxes.

EBITDA

Earnings before interest, taxes, depreciation, and amortization.

EJ200

The EJ200 engine powers the Eurofighter and its export version, the Typhoon. MTU is responsible for the development and manufacture of the low-pressure and high-pressure compressors and the electronic control unit. The company also manufactures highpressure turbine parts, and carries out engine assembly and test runs.

Engine Pool Services

The Engine Pool Services are MTU’s response to the increasing demand for engine services beyond maintenance proper. The focus is on the provision of lease and spare engines as well as industrial gas turbines.

Equity Ratio

The equity ratio is a parameter for the financing structure. It indicates the percentage of equity capital to total capital.

FAA

The Federal Aviation Administration (FAA) is the U.S. approval agency for all matters pertaining to aviation.

FAR33

FAR is the abbreviation for the FAA’s Federal Aviation Regulations. Part 33 of the FAR specifies test standards for engines.

Free Cashflow

Free cashflow is the total of operational cashflow and cashflow from investment activities. It provides funds for retiring debt, paying dividends, and increasing cash reserves.

Free Float

Free float refers to the part of capital stock held by shareholders with a low stockholding.

General Electric

General Electric is a diversified technology, manufacturing and services company. One of its businesses is aircraft engines. In this business, General Electric is the world leader.

GP7000

MTU has a share of 22.5% in the GP7000 engine co-developed by General Electric and Pratt & Whitney. This completely new family of engines will be used in long-haul service. It is intended to power the Airbus A380 and possibly other Airbus and Boeing aircraft as well.

High-Pressure Compressor

See Compressor.

High-Pressure Turbine

See Turbine.

IAE

IAE stands for IAE International Aero Engines AG, Zurich. IAE is the consortium for the V2500 engine. Partners in this consortium are Pratt & Whitney, Rolls-Royce, JAEC, and MTU Aero Engines.

IFRS

IFRS is the abbreviation for international financial reporting standards, which are based on Anglo-American balance sheet principles.

Intermediate-Pressure Compressor

See Intermediate-Pressure Turbine.

Intermediate-Pressure Turbine

In addition to the usual high-pressure and low-pressure turbines, three-shaft engines also feature an intermediate-pressure turbine. It drives the intermediate-pressure compressor.

Interturbine Duct

The interturbine duct connects the highpressure turbine to the low-pressure turbine. This transition area is particularly critical. Therefore, the interturbine duct must meet very stringent requirements.

ISIN

ISIN stands for International Securities Identification Number. It is a unique worldwide identification number for securities.

ITP

Industria de Turbo Propulsores (ITP) is Spain’s only engine manufacturer. ITP is represented in a number of European engine programs, for example the EJ200, the TP400-D6, and the MTR390 Enhanced.

J79

The J79 has been manufactured by MTU under license from General Electric since 1970. It was used initially on the Lockheed F-104 Starfighter and since 1973 has been powering the McDonnell Douglas F-4 Phantom II aircraft of the German Armed Forces (Bundeswehr). Today MTU’s J79-related activities concentrate on maintenance.

JAEC

Japanese Aero Engines Corporation (JAEC) is a joint venture in which Kawasaki, Mitsubishi, and Ishikawajima Harima have pooled their engine activities in conjunction with their participation in IAE, the international V2500 engine consortium.

Joint Venture

A contractual agreement joining two or more independent companies for the purpose of executing a particular joint business undertaking.

JT15D

The JT15D can be used both in the military and in the commercial sector. For years, the characteristics of the JT15D have made it the ideal engine for business jets. The JT15D is maintained by MTU Maintenance Berlin- Brandenburg.

LM Series

The LM series refers to General Electric industrial gas turbines, which are derived from aircraft engines. Examples are the LM5000 based on the CF6-50 and the LM6000 based on the CF6-80.

LM2500

The LM2500, an industrial gas turbine manufactured by General Electric, derives from the CF6-6 aircraft engine. It is maintained by MTU Maintenance Berlin-Brandenburg.

LM6000

For General Electric’s family of LM6000 industrial gas turbines, which is derived from the CF6-80 aircraft engine, MTU offers repair and maintenance services.

Low-Pressure Turbine

See Turbine.

MTR390 / MTR390 Enhanced

The MTR390, which was developed by MTU in cooperation with Turbomeca and Rolls- Royce, is the powerplant of the German- French support and anti-tank helicopter Tiger. MTU’s workshare comprises the core engine with combustor and gas generator turbine, as well as a number of accessories. For the export customer Spain, an uprated version – the MTR390 Enhanced – is being developed.

OCCAR

OCCAR (Organisation Conjointe de Coopération en Matière d’Armement) is a European procurement agency headquartered in Bonn, which, among other things, is responsible for the procurement of the Tiger helicopter and the A400M military transport.

Pratt & Whitney

The engine manufacturer Pratt & Whitney is a division of U.S. based United Technologies Corporation. Next to General Electric, it is the second big engine manufacturer in the country. Pratt & Whitney Canada is part of the Pratt & Whitney group.

Price-Earnings Ratio (PER)

The price-earnings ratio refers to the relationship between the price of a company’s stock at the end of the accounting term and the net profit per share for this accounting term.

PT6A

The PT6A is an especially lightweight turboprop engine for business jets. Special versions of the engine power transport and military aircraft. The PT6A is maintained by MTU Maintenance Berlin-Brandenburg.

PW200

Pratt & Whitney Canada’s PW200 is an engine for light and medium-weight helicopters. It is part of MTU Maintenance Berlin-Brandenburg’s maintenance portfolio.

PW2000

In cooperation with Pratt & Whitney, MTU has been developing and manufacturing the PW2000 since 1979. PW2000 engines are used in the commercial and military area on medium- and long-haul aircraft, such as the Boeing 757 and C-17. MTU’s contribution to this engine includes the development of the low-pressure turbine and the turbine exhaust casing, as well as the production of the most important parts of the low-pressure turbine and highly-engineered turbine disks. MTU Maintenance Hannover offers complete maintenance for the engine.

PW300

PW300 engines are used on mid-size business jets. MTU contributes the development and production of the complete three-stage low-pressure turbine, including the turbine exit case, and conducts test runs.

PW6000

The PW6000 is being developed in cooperation with Pratt & Whitney. In a first for the company, MTU is developing and delivering the entire low-pressure turbine subsystem and the high-pressure compressor for a commercial engine. The PW6000 is designed for use on short-haul aircraft and will power the Airbus A318. Final assembly of all PW6000 engines will be performed exclusively at MTU Maintenance Hannover.

Rating

Ratings are standardized credit evaluations of debt instruments and companies by independent, specialized rating agencies. They are used to assess the future ability of a company to fulfill its payment obligations completely and on time and result from the analysis of quantitative and qualitative factors.

RB199

The RB199 was developed and produced jointly with Rolls-Royce and FiatAvio (now: Avio) for use on the Tornado multi-role combat aircraft. MTU’s contribution to this engine included the intermediate-pressure and high-pressure compressors, the external wheelcase, the thrust reverser, and the bypass casing. Now that production of this engine has been discontinued, MTU is concentrating on maintenance for this engine.

Risk and Revenue Sharing

When an engine manufacturer – for example, MTU Aero Engines – participates in a program as a risk-and-revenue-sharing partner, it bears all risks of the overall program for its percentage share – not just for the parts of its workshare. In compensation, it also receives the same percentage share of profits from sales.

Rolls-Royce

Next to General Electric and Pratt & Whitney, the British company Rolls-Royce is the world’s third large engine manufacturer.

Snecma Moteurs

Snecma Moteurs – now part of the French SAFRAN Group – is the French engine manufacturer. In the commercial area, it cooperates closely with General Electric; in the military area, Snecma acts as an OEM, for example for the M88 engine.

Subsystem

The overall engine is made up of a number of subsystems. They include the high-pressure and low-pressure compressors, combustor, high-pressure and low-pressure turbines, and the control system.

TP400-D6

The TP400-D6, a military turboprop engine, is intended to power the A400M military transport. MTU is responsible for the intermediate shaft with intermediate-pressure compressor and turbine and parts of the control system. Furthermore, final assembly and testing of all TP400-D6 engines manufactured in Europe are being performed exclusively at MTU Maintenance Berlin- Brandenburg.

Turbine

In the turbine, the energy contained in the gases emitted from the combustor at high pressures and high velocity is converted into mechanical energy. Like the compressor, the turbine is divided into two parts: the highpressure and low-pressure sections. The turbine is connected directly to the corresponding compressor via the respective shaft. The turbine has to withstand substantially higher stresses than the compressor, being exposed to high gas temperatures and additionally to extreme centrifugal forces that tear at the outer rim of the turbine disks with a force of several tons.

Turbomeca

Turbomeca is a subsidiary of the Snecma Group, which specializes in helicopter engines. It is a partner in the MTR390 program.

V2500

The V2500, a two-spool turbofan engine for short- and medium-haul aircraft, is used on the Airbus A319, A320, and A321 as well as the Boeing/McDonnell Douglas MD90. MTU is responsible for the complete lowpressure turbine. The current annual production rate of this engine type is 250 to 300 units. The maintenance business is becoming increasingly important for the V2500.

Working Capital

The working capital is the difference between current assets (not counting liquid assets and securities) and short-term liabilities (not counting bank loans). It is a parameter for monitoring changes in liquidity.