Outlook 2010

When MTU published its half-year results on July 27, 2010, the company also adjusted its full-year guidance, the reason for the update being in particular a more advantageous exchange rate between the euro and the U.S. dollar.

Since, in the first months of 2010, passenger and freight traffic have substantially recovered, MTU expects markets to further stabilize. The recovery will be driven principally by the Asia-Pacific region and the Middle East. MTU is well positioned in this market environment, thanks to its business model and local presence in the major growth markets.

In 2010, the company expects to generate revenues in the amount of approximately 2,750 million euros. So far, MTU had anticipated revenues on the level of last year. In the commercial engine business, MTU assumes that revenues in U.S. dollars will remain stable on last year's level. The forecast for the military OEM business remains unchanged. This business segment is expected to generate annual revenues in the amount of about 500 million euros also in 2010. In the commercial engine maintenance business, revenues in U.S. dollars will remain stable. In the wake of the economic recovery, demand for maintenance services and spare parts can be expected to rise again slightly in the course of the year, in particular in the second half.

For 2010, MTU is expecting an operating profit (EBIT adjusted) of about 310 million euros. Initially, the company had assumed an operating profit on the level of the previous year. The adjusted EBIT margin will be approximately the same as last year. Compared with 2009, the 2010 result will be negatively impacted by a slight rise in development expenditure, especially in connection with the geared turbofan programs. This will be compensated by cost savings resulting from the Challenge 2010 improvement program.

Net income for the financial year 2010 is similarly expected to remain close to the 2009 level.

In the financial year 2010, the company expects a free cash flow in the order of 120 million euros despite persistently high investments in future projects. So far, MTU had assumed a free cash flow of approx. 100 million euros.

in € million	2009	Outlook 2010 February	Outlook 2010 new*
Revenues	2,611	stable	~ 2,750
EBIT adjusted	292	stable	~ 310
Free cash flow	120	~ 100	~ 120
Net income	141	stable	stable

* The outlook is based on an exchange rate assumption for the fiscal year 2010 of 1.30 $/€.

Status: July 27, 2010

Disclaimer

In addition to information relating to past events, this report also contains forward-looking statements. Such passages can generally be identified through the use of such terms as ‘expect’, ‘estimate’, ‘intend’, ‘plan’, ‘anticipate’, ‘predict’, ‘will’, ‘believe’, ‘is likely to’, ‘might’ and similar phrases, or through the fact that they are presented in the context of a strategy. Forward-looking statements relate to future expectations, developments, trends, and business strategies, and are based on analyses or predictions of MTU’s future business performance and estimates of figures that cannot be affirmed with any certainty at the present time. These forward-looking statements merely reflect MTU’s current outlook at the time the statements were made, and MTU does not accept any responsibility for updating forward-looking statements except in cases where it is a statutory requirement. The forward-looking statements contained in this report involve known and unknown risks, uncertainties, and other factors that may result in an actual future outcome based on real events, developments and performances that deviates significantly from the content of the statements presented here. These factors include changes in the general economic climate and business environment, exchange rate fluctuations, in addition to the factors enumerated in the "risk report" section of the MTU Annual Report 2009 (p. 109 - 125).