<SEC-DOCUMENT>0001173382-12-000004.txt : 20120213
<SEC-HEADER>0001173382-12-000004.hdr.sgml : 20120213
<ACCEPTANCE-DATETIME>20120213104638
ACCESSION NUMBER:		0001173382-12-000004
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20111231
FILED AS OF DATE:		20120213
DATE AS OF CHANGE:		20120213

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CAE INC
		CENTRAL INDEX KEY:			0001173382
		STANDARD INDUSTRIAL CLASSIFICATION:	MISCELLANEOUS ELECTRICAL MACHINERY, EQUIPMENT & SUPPLIES [3690]
		IRS NUMBER:				000000000

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-31402
		FILM NUMBER:		12596000

	BUSINESS ADDRESS:	
		STREET 1:		2025 LOGISTICS DRIVE
		CITY:			MISSISSAUGA
		STATE:			A6
		ZIP:			L5S 1Z9
		BUSINESS PHONE:		514-341-6780

	MAIL ADDRESS:	
		STREET 1:		8585 COTE DE LIESSE, CP 1800
		STREET 2:		DEPT. 04
		CITY:			ST-LAURENT, QUEBEC
		STATE:			A6
		ZIP:			H4L 4X4
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>ksignedqereport.htm
<DESCRIPTION>3RD QUARTER REPORT 2012
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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">SECURITIES AND EXCHANGE COMMISSION</FONT></B></TD></TR>

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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">Washington, DC 20549</FONT></B></TD></TR>

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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">Form 6-K</FONT></B></TD></TR>

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   <TD colSpan=3>&nbsp;</TD></TR>

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   <TD colSpan=3 align=center><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Report of Foreign Issuer</FONT></TD></TR>

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   <TD colSpan=3 align=center><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Pursuant to Rule 13a-16 or 15d-16 of</FONT></TD></TR>

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   <TD colSpan=3 align=center><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">the Securities Exchange Act of 1934</FONT></TD></TR>

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   <TD align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">For the month of:</FONT></TD>

   <TD align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">February, 2012</FONT></TD>

   <TD style="TEXT-INDENT: 114.74pt" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Commission File Number: 1-31402</FONT></TD></TR>

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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">CAE INC.</FONT></B></TD></TR>

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   <TD colSpan=3 align=center><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">(Name of Registrant)</FONT></TD></TR>

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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">8585 Cote de Liesse</FONT></B></TD></TR>

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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">Saint-Laurent, Quebec</FONT></B></TD></TR>

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   <TD colSpan=3 align=center><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">Canada H4T 1G6</FONT></B></TD></TR>

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   <TD colSpan=3 align=center><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">(Address of Principal Executive Offices)</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: center"><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:</FONT></P>

<P style="TEXT-ALIGN: center"><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Form 20-F&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </FONT><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Form 40-F X</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): X</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the SEC pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:</FONT></P>

<P style="TEXT-ALIGN: center"><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Yes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </FONT><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">No X</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">If &#8220;Yes&#8221; is marked, indicate the file number assigned to the registrant in connection with Rule </FONT><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">12g3-2(b): N/A</FONT></P></DIV>

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<P style="TEXT-ALIGN: center"><B><FONT size=3 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">SIGNATURES</FONT></B></P>

<P style="TEXT-ALIGN: left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.</FONT></P>

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   <TD width="37%" align=left>&nbsp;</TD>

   <TD width="15%" align=left><B><FONT size=4 face="Times New Roman,Bold,Arial,Helvetica,sans-serif"></FONT></B></TD>

   <TD width="48%" colSpan=2 align=left><B><FONT size=4 face="Times New Roman,Bold,Arial,Helvetica,sans-serif">CAE Inc.</FONT></B></TD></TR>

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   <TD width="100%" colSpan=4>&nbsp;</TD></TR>

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   <TD width="37%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Date: February <FONT size=3 face="Times New Roman">10</FONT>, 2012</FONT></TD>

   <TD width="15%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif"></FONT></TD>

   <TD width="3%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">By:</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="45%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">/s/ Hartland Paterson</FONT></TD></TR>

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   <TD width="3%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Name:</FONT></TD>

   <TD width="45%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Hartland J. Paterson</FONT></TD></TR>

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   <TD width="3%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Title:</FONT></TD>

   <TD width="45%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">Vice President Legal, General Counsel</FONT></TD></TR>

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   <TD width="37%" align=left>&nbsp;</TD>

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   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="45%" align=left><FONT size=3 face="Times New Roman,Arial,Helvetica,sans-serif">and Corporate Secretary</FONT></TD></TR></TABLE></DIV>

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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">1</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><B><FONT size=2 face="HelveticaNeue-Bold,Arial,Helvetica,sans-serif">Report to Shareholders</FONT></B></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">3</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><B><FONT size=2 face="HelveticaNeue-Bold,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></B></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">3</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">1. Highlights</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">4</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">2. Introduction</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">5</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">3. About CAE</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">13</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">4. Foreign exchange</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">14</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">5. Non-GAAP and other financial measures</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">16</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">6. Consolidated results</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">18</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">7. Results by segment</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">27</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">8. Consolidated cash movements and liquidity</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">28</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">9. Consolidated financial position</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">29</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">10. Business combinations</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">31</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">11. Change in accounting standards</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">31</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">12. International financial reporting standards (IFRS) implementation</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">31</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">13. Controls and procedures</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">32</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">14. Selected quarterly financial information</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">33</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><B><FONT size=2 face="HelveticaNeue-Bold,Arial,Helvetica,sans-serif">Consolidated Interim Financial Statements</FONT></B></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">33</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Consolidated statement of financial position</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">34</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Consolidated income statement</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">35</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Consolidated statement of comprehensive income</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">36</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Consolidated statement of changes in equity</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">37</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Consolidated statement of cash flows</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">38</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><B><FONT size=2 face="HelveticaNeue-Bold,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT></B></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">38</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 1 &#150; Nature of operations and summary of significant accounting policies</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">39</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 2 &#150; First-time adoption of IFRS</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">45</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 3 &#150; Business combinations</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">47</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 4 &#150; Investments in joint ventures</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">47</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 5 &#150; Accounts receivable</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">48</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 6 &#150; Debt facilities and finance expense, net</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">49</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 7 &#150; Earnings per share and dividends</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">49</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 8 &#150; Employee compensation</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">49</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
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<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 9 &#150; Other (gains) losses - net</FONT></P>
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<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">50</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 10 &#150; Supplementary cash flows information</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">50</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 11 &#150; Government assistance</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">51</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 12 &#150; Related party transactions</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">52</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=2 face="HelveticaNeue-Light,Arial,Helvetica,sans-serif">Note 13 &#150; Operating segments and geographic information</FONT></P>
	</TD>
</TR>
</TABLE>
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<P style="text-align: left;">
<FONT size=5 face="ArialMT,Arial,Helvetica,sans-serif">Report to Shareholders</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE reported financial results for the third quarter ended December 31, 2011. Net income attributable to equity holders of the company was C&#36;45.6 million (C&#36;0.18 per share) this quarter, up 18% compared to C&#36;38.5 million (C&#36;0.15 per share) last year. All financial information is in Canadian dollars.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue for the quarter was &#36;453.1 million, 10% higher than &#36;410.8 million in the third quarter last year. Third quarter operating profit was &#36;77.5 million, or 17.1% of revenue.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#147;We are pleased with our financial performance this quarter with stronger margins in both our civil and defence business units,&#148; said Marc Parent, CAE&#146;s President and Chief Executive Officer. &#147;The level of civil aviation market activity remains high in all regions and our order intake reflects our strong competitive position. Although procurement delays in defence continue to make predicting the timing of orders a challenge, we won contracts with key defence customers during the quarter. As well, we remain encouraged by the range of global opportunities in our pipeline.&#148;</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Civil segments</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue for our combined Civil segments increased 13% in the third quarter to &#36;203.7 million compared to &#36;179.9 million last year. Operating profit was &#36;42.0 million (20.6% of revenue) compared to &#36;32.1 million (17.8% of revenue) last year. Revenue for the first nine months increased 18% to &#36;625.5 million compared to &#36;529.7 million last year. Year-to-date operating profit was &#36;129.5 million (20.7% of revenue), compared to &#36;100.0 million (18.9% of revenue) last year.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our civil market activity continued to be strong across all regions in the third quarter. We sold 11 full-flight simulators, bringing our nine month total orders to 30, which exceeds the total number we sold all of last year. We also signed training services contracts expected to generate &#36;122.2 million in future revenue, including an exclusive long term agreement with flydubai in the United Arab Emirates. We also broadened our footprint in South East Asia with the announcement of a training joint venture with Cebu Pacific Air in the Philippines.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We received &#36;234.6 million in combined civil segment orders this quarter representing a book-to-sales ratio of 1.15x. The ratio for the last 12 months was 1.24x.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Military segments</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue for CAE&#146;s combined Military segments increased 1% in the third quarter to &#36;222.3 million compared to &#36;219.8 million last year. Third quarter operating profit was &#36;36.9 million (16.6% of revenue), compared to &#36;39.5 million (18.0% of revenue) last year. Revenue for the first nine months increased 4% to &#36;630.2 million compared to &#36;608.6 million last year. Year-to-date operating profit was &#36;96.5 million (15.3% of revenue), compared to &#36;109.3 million (18.0% of revenue) last year.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">During the quarter, CAE was awarded contracts for Tornado jet maintenance trainers for the German Air Force and UK Royal Air Force, and we received additional contract options for P-8A Poseidon simulators for Boeing and the US Navy. In terms of aftermarket opportunities, we won upgrade work for Canadian Forces simulators involving the CC-130H Hercules aircraft and the CH-146 Griffon helicopter. In Asia, we were awarded contracts to provide support services for an AW139 helicopter simulator in Malaysia and a multi-year, helicopter training services contract with another key customer in the region.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Combined Military orders in the quarter totaled &#36;124.1 million for a book-to-sales ratio of 0.56x. The ratio for the last 12 months was 0.89x. In addition to CAE&#146;s combined military backlog of &#36;2.0 billion at December 31, 2011, CAE&#146;s unfunded military backlog was &#36;269.4 million.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">New Core Markets</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue for New Core Markets was &#36;27.1 million compared to &#36;11.1 million last year. Operating loss was &#36;1.4 million, compared to a loss of &#36;1.3 million last year.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Healthcare received endorsement for its ultrasound e-Learning curriculum and seminars from the Canadian Critical Care Society and the simulation centre we manage at Universit&eacute; de Montr&eacute;al received accreditation from The Royal College of Physicians and Surgeons of Canada. During the quarter we sold patient simulators, courseware, and centre management systems to customers in North America, Eastern Europe, and the Middle East.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Mining added new customers for its geological modeling, data management, and mine planning systems including Silver Lake Resources and Optiro in Australia and Exploraciones Mineras Parre&ntilde;a in Mexico.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 1</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=2 face="ArialMT,Arial,Helvetica,sans-serif">Report to Shareholders</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Additional financial highlights</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes this quarter were &#36;15.2 million representing an effective tax rate of 25%, compared to 29% last year. The decrease was mainly due to the settlement of a tax audit in Canada as well as a change in the mix of income from various jurisdictions.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Free cash flow was &#36;46.2 million this quarter owing to a favourable change in non-cash working capital compared to last year and more cash provided by continuing operations.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital expenditures totalled &#36;44.1 million this quarter, including &#36;25.3 million in support of our growth initiatives and the balance for maintenance.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net debt was &#36;593.9 million as at December 31, 2011 compared with &#36;618.8 million as at September 30, 2011. The decrease of &#36;24.9 million was mainly due to favourable foreign exchange movements.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE will pay a dividend of &#36;0.04 per share on March 30, 2012 to shareholders of record at the close of business on March 15, 2012.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2 | CAE Third Quarter Report 2012</FONT></P>
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<P style="text-align: left;">
<FONT size=5 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">for the three months ended December 31, 2011</FONT></I></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1. HIGHLIGHTS</FONT></B></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">International Financial Reporting Standards (IFRS)</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This quarterly report is prepared in accordance with IFRS and should be read in conjunction with our consolidated interim financial statements for the nine-month period ending December 31, 2011, which were prepared in accordance with IAS 34, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Interim financial reporting, </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and IFRS 1, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">First-time adoption of IFRS, </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">as issued by the International Accounting Standards Board (IASB). The comparative figures for each period of the year ended March 31, 2011 have been restated to comply with IFRS. See Note 2 of the consolidated interim financial statements for details on the most significant adjustments to the statements of changes in equity, net income, comprehensive income and cash flows.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">FINANCIAL</FONT></B></P>
<P style="text-align: left;">
<FONT color="#777777" size=2 face="ArialMT,Arial,Helvetica,sans-serif">THIRD QUARTER OF FISCAL 2012</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Higher revenue over last quarter and higher revenue over the third quarter of fiscal 2011</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated revenue was &#36;453.1 million this quarter, &#36;19.6 million or 5% higher than last quarter and &#36;42.3 million or 10% higher</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">than the third quarter of fiscal 2011;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For the first nine months of fiscal 2012, consolidated revenue was &#36;1,314.5 million, &#36;149.3 million or 13% higher than the same</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">period last year.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Higher net income attributable to equity holders of the Company compared to last quarter and compared to the third quarter of fiscal 2011</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net income attributable to equity holders of the Company was &#36;45.6 million (or &#36;0.18 per share) this quarter, compared to</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;38.4 million (or &#36;0.15 per share) last quarter, representing an increase of &#36;7.2 million or 19%, and compared to &#36;38.5 million</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(or &#36;0.15 per share) in the third quarter of fiscal 2011, representing an increase of &#36;7.1 million or 18%;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For the first nine months of fiscal 2012, net income attributable to equity holders of the Company was &#36;127.1 million (or &#36;0.49 per</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">share) compared to &#36;114.8 million (or &#36;0.45 per share) for the same period last year, a &#36;12.3 million or 11% increase;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Excluding charges of &#36;8.4 million (&#36;2.7 million after tax) related to the acquisition and integration of Medical Education</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Technologies, Inc. (METI), which was acquired during the second quarter of fiscal 2012, net income attributable to equity holders</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">of the Company would have been &#36;41.1 million (or &#36;0.16 per share) last quarter and &#36;129.8 million (or &#36;0.50 per share) for the first</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">nine months of fiscal 2012.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Free cash flow</FONT></B><B><SUP><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1 </FONT></SUP></B><B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">at positive &#36;46.2 million this quarter</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net cash provided by operations was &#36;70.4 million this quarter, compared to &#36;129.2 million last quarter and &#36;33.9 million in the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">third quarter of last year;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Maintenance capital expenditures</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and other asset expenditures were &#36;17.3 million this quarter, &#36;15.1 million last quarter, and</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;16.9 million in the third quarter of last year;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash dividends were &#36;8.0 million this quarter, &#36;8.3 million last quarter and &#36;10.1 million in the third quarter of last year.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Capital employed</FONT></B><B><SUP><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1 </FONT></SUP></B><B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">decreased by &#36;6.5 million over last quarter</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-cash working capital</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">increased by &#36;18.7 million, ending at &#36;144.0 million;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment decreased by &#36;18.5 million;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other long-term assets decreased by &#36;11.4 million, while other long-term liabilities decreased by &#36;4.7 million;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net debt</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">ended at &#36;593.9 million this quarter compared to &#36;618.8 million last quarter.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">ORDERS</FONT></B><B><SUP><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1</FONT></SUP></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The book-to-sales ratio</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">for the quarter was 0.85x (combined civil was 1.15x, combined military was 0.56x and New Core Markets</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">was 1.0x). The ratio for the last 12 months was 1.05x (combined civil was 1.24x, combined military was 0.89x and New Core</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Markets was 1.0x);</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total order intake was &#36;385.8 million, compared to &#36;563.4 million last quarter and &#36;514.4 million in the third quarter of fiscal 2011;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total backlog</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">was &#36;3,514.9 million as at December 31, 2011.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Civil segments</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Civil obtained contracts with an expected value of &#36;122.2 million;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Civil won &#36;112.4 million of orders, including contracts for 11 full-flight simulators (FFSs). During the quarter,</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">the segment also received a cancellation of a simulator order from a prior year.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Military segments</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Military won &#36;67.5 million of orders for new training systems and upgrades;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Military won contracts valued at &#36;56.6 million.</FONT></P></LI>
<LI>
<P align="justify"></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-GAAP and other financial measures (see Section 5).</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 3</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">New Core Markets segment</FONT></B><BR>
<FONT size=1 face="SymbolMT,Arial,Helvetica,sans-serif">- </FONT><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">New Core Markets won &#36;27.1 million of orders.</FONT><BR>
<BR>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">OTHER</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">During the quarter, we entered into a new joint venture arrangement to form Philippine Academy for Aviation Training, Inc.</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(50% interest).</FONT></P></LI>
<LI>
<P align="justify"></P></LI>
<LI>
<P align="justify"><B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">INTRODUCTION</FONT></B></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In this report, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">we, us, our, CAE </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Company </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">refer to CAE Inc. and its subsidiaries. Unless we have indicated otherwise:</FONT></P>
<UL>
<LI>
<P align="justify"><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">This year </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">2012 </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">mean the fiscal year ending March 31, 2012;</FONT></P></LI>
<LI>
<P align="justify"><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Last year, prior year </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">a year ago, </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">mean the fiscal year ended March 31, 2011;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Dollar amounts are in Canadian dollars.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This report was prepared as of February 8, 2012, and includes our management&#146;s discussion and analysis (MD&amp;A), unaudited consolidated interim financial statements and notes for the third quarter ended December 31, 2011. We have written it to help you understand our business, performance and financial condition for the third quarter of fiscal 2012. Except as otherwise indicated, all financial information has been reported in accordance with IFRS. All tables disclosed are based on unaudited figures.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For additional information, please refer to our unaudited consolidated interim financial statements for the quarter ended December 31, 2011, and our annual consolidated financial statements, which you will find in our annual report for the year ended March 31, 2011. The MD&amp;A section of our 2011 annual report also contains more information about:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our vision;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our strategy and value proposition;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our operations;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Foreign exchange;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-GAAP and other financial measures;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated results;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Acquisitions, business combinations and divestitures;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Business risk and uncertainty;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Controls and procedures;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The oversight role of the Audit Committee and Board of Directors.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">You will find our most recent annual report and Annual Information Form (AIF) on our website at www.cae.com, on SEDAR at www.sedar.com or on EDGAR at www.sec.gov.</FONT></P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">ABOUT MATERIAL INFORMATION</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This report includes the information we believe is material to investors after considering all circumstances, including potential market sensitivity. We consider something to be material if:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">It results in, or would reasonably be expected to result in, a significant change in the market price or value of our shares, or;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">It is quite likely that a reasonable investor would consider the information to be important in making an investment decision.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">ABOUT FORWARD-LOOKING STATEMENTS</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This report includes forward-looking statements about our activities, events and developments that we expect to or anticipate may occur in the future including, for example, statements about our business outlook, assessment of market conditions, strategies, future plans, future sales, pricing for our major products and capital spending. Forward-looking statements normally contain words like </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">believe</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">expect</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">anticipate</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">plan, intend</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">continue</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">estimate</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">may</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">will</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">should </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and similar expressions. Such statements are not guarantees of future performance. They are based on management&#146;s expectations and assumptions regarding historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate in the circumstances.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We have based these statements on estimates and assumptions that we believed were reasonable when the statements were prepared. Our actual results could be substantially different because of the risks and uncertainties associated with our business. Important risks that could cause such differences include, but are not limited to, the length of sales cycles, rapid product evolution, level of defence spending, condition of the civil aviation industry, competition, availability of critical inputs, foreign exchange rate occurrences and doing business in foreign countries. Additionally, differences could arise because of events that are announced or completed after the date of this report, including mergers, acquisitions, other business combinations and divestitures. You will find more information about the risks and uncertainties affecting our business in our 2011 annual report.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">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.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4 | CAE Third Quarter Report 2012</FONT></P>
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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<TABLE border=0 cellspacing=0>
<TR>
	<TD nowrap valign=top width="2%">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.</FONT></B>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">ABOUT CAE</FONT></B></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.1</FONT></B>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Who we are</FONT></B></P>
	</TD>
</TR>
</TABLE>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE is a world leader in providing simulation and modeling technologies and integrated training services primarily to the civil aviation industry and defence forces around the globe. We are globally diversified with more than 7,500 people at more than 100 sites and training locations in over 25 countries. We have annual revenue exceeding &#36;1.6 billion, nearly 90% of which comes from worldwide exports and international activities. We have the largest installed base of civil and military flight simulators and a broad global aviation training network of 34 civil aviation, military and helicopter training centres where we train more than 80,000 civil and military crewmembers annually. Our main products include full-flight simulators (FFSs), which replicate aircraft performance in a full array of situations and environmental conditions. By leveraging our core competencies and aviation best practices, we also offer solutions in healthcare and mining where similar operational imperatives exist for increased safety, efficiency and mission readiness.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Approximately half of our revenue comes from the sale of simulation products, software and simulator updates, and the balance from services including training, maintenance, aviation services and professional services.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Founded in 1947 and headquartered in Montreal, Canada, CAE has built an excellent reputation and long-standing customer relationships based on more than 60 years of experience, strong technical capabilities, a highly trained workforce, and global reach.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE&#146;s common shares are listed on the Toronto and New York stock exchanges under the symbol CAE.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.2 Our vision</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our vision is for CAE to be synonymous with safety, efficiency and mission readiness. We intend to be the mission partner of choice for customers operating in complex mission-critical environments by providing the most innovative product and service solutions to enhance safety, improve efficiency and provide superior decision-making capabilities.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.3 Our operations</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We primarily serve two markets globally:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The civil market includes aircraft manufacturers, major commercial airlines, regional airlines, business aircraft operators, civil</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">helicopter operators, third-party training centres, ab initio pilot students and flight training organizations (FTOs);</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The military market includes original equipment manufacturers (OEMs), government agencies and defence forces worldwide.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We also serve the healthcare market, involving hospital and university simulation centres, teaching institutions, medical societies and OEMs, and the mining market, serving global mining corporations, exploration companies, mining contractors and the world&#146;s premier mining consultancies.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We are a global leader with an unparalleled range of capabilities to help our customers achieve greater levels of operational efficiency, safety and readiness. As such, we use an integrated solutions-based approach to market, which often results in multi-year agreements with our customers to provide them with a full complement of both products and services. Although this go-to-market approach increasingly entails the bundling of products and services, since fiscal 2006, we have reported our operating results in four individual segments: one for products and one for services for each of our two main markets. In addition to our Civil and Military business segments, we report Healthcare and Mining which, as of the first quarter of fiscal 2012, are presented together as the New Core Markets (NCM) segment (previously presented in Training &amp; Services/Civil). Fiscal 2011 comparative figures for Training &amp; Services/Civil have been restated.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">CIVIL MARKET</FONT></B></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Training &amp; Services/Civil (TS/C)</FONT></B></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Provides business, commercial and helicopter aviation training for flight, cabin, maintenance and ground personnel and associated services</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We are the largest provider of commercial and helicopter aviation training services in the world and the second largest provider of business aviation training services. We lead the market in the high-growth emerging regions of Latin America, China, Southeast Asia, India and the Middle East. Through our broad global network of training centres we serve all sectors of civil aviation including general aviation, major and regional airlines, helicopter operators and business aviation. We currently operate 170 FFSs and provide aviation training and services in more than 20 countries around the world, including aviation training centres, FTOs and third-party locations. Among our thousands of customers, we have strategic relationships, partnerships and joint ventures with more than 20 major airlines, aircraft operators and OEMs around the world. We offer a comprehensive range of training solutions and services, including curriculum development, training centre operations, pilot training, cabin crew training, aircraft maintenance technician training services, e-Learning and courseware solutions, and consulting services. We are a leader in flight sciences, using flight data analysis to improve airline safety, maintenance, flight operations and training. CAE Global Academy is the world&#146;s largest network of ab initio FTOs, with a capacity for training up to 1,800 pilot cadets annually. We also offer our global base of airline customers a long-term solution to pilot recruitment with pilot sourcing services.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 5</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Simulation Products/Civil (SP/C)</FONT></B></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Designs, manufactures and supplies civil flight simulation training devices and visual systems</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We are the world leader in the provision of civil flight simulation equipment, including FFSs and a comprehensive suite of integrated training procedures trainers, flight training devices and web-based e-learning, using the same high-fidelity Level D software as the FFSs. We have designed and manufactured more civil FFSs for major and regional commercial airlines, third-party training centres and OEMs than any other company. We have developed a wealth of experience in developing first-to-market simulators for more than 35 new types of aircraft models, and more recently we have developed or have been awarded contracts to develop simulators for the Airbus A350 XWB, Boeing 747-8 and 787, Mitsubishi Regional Jet (MRJ), ATR42-600 and ATR72-600, Bombardier CSeries, Global Express and Learjet 85, Embraer Phenom 100 and 300, Dassault Falcon 7X, and the Commercial Aircraft Corporation of China, Ltd (COMAC) ARJ21. We also offer a full range of support services including simulator updates and upgrades, maintenance services, sales of spare parts and simulator relocations.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Market trends and outlook</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In commercial aviation, aircraft capacity and passenger traffic growth are primarily driven by gross domestic product (GDP). The aerospace industry&#146;s widely held expectation is that long-term average growth for air travel will be approximately 5% annually over the next two decades. The growth rates in the emerging markets have been outpacing this global average growth rate, which is of particular interest to us given our leadership position in these regions. The U.S. legacy airlines, a traditional CAE customer base, are in the process of renewing their aircraft fleets to modern, efficient aircraft. The growth in air travel and re-fleeting requirements have led to high commercial aircraft backlogs, to commercial aircraft manufacturers increasing their production rates and to the announcement of new aircraft programs.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In business aviation, aircraft orders and utilization are also primarily driven by GDP and by general economic conditions. U.S.-operated aircraft utilization has to improve by approximately 15-20% in order to recover the ground lost during the last recession. The business aviation industry remains cautiously optimistic, and while some market uncertainty persists, the number of business jet flights has risen in the last 12 months according to the Federal Aviation Industry (FAA).</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Major business aircraft OEMs such as Bombardier, Cessna, Dassault and Gulfstream have announced new aircraft programs which are an indication of their long-term confidence in the demand for business aircraft travel. Globally, there continues to be steady demand for large-cabin business jets and to a lesser extent, mid-sized jets. In the small-cabin segment, demand has remained stable at low levels.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In the SP/C segment, the level of market activity has improved in the current fiscal year. We expect to maintain our leadership position and reach FFS unit sales in the mid-30s in fiscal 2012.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The following secular trends form the basis of our Civil market investment hypothesis:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Expected long-term growth in air travel;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Demand in emerging markets arising from secular growth and a need for infrastructure to support air travel;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Aircraft backlogs;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">More efficient and more technologically advanced aircraft platforms;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Aircraft re-fleeting by legacy airlines;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Long-term demand and shortage of trained aviation professionals (pilots, maintenance, cabin crew);</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Continued strong regulatory environment.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Expected long-term growth in air travel</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In calendar 2011, passenger traffic increased by 5.9% compared to calendar 2010, while freight-tonne-kilometres remained stable over the same period, a modest 0.7% decrease compared to calendar 2010. Over the past 20 years, air travel has grown at an average rate of 4.8% and this is expected to continue over the next 20 years. Possible impediments to steady growth progression in air travel include major disruptions such as regional political instability, acts of terrorism, pandemics, natural disasters, sharp and sustained increases in fuel costs, major prolonged economic recessions or other major world events.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Demand in emerging markets arising from secular growth and a need for infrastructure to support air travel</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Emerging markets such as Southeast Asia, the Indian sub-continent, the Middle East, Eastern Europe, Africa, South America and China are expected to continue experiencing higher air traffic and economic growth over the long term more than mature markets such as North America and Western Europe, as well as an increasing liberalization of air policy and bilateral air agreements. We expect these markets to drive the long-term demand for the broad array of products and services solutions that we bring to bear. We have been active in these high-growth regions for several decades and are positioned as the market leader with well-established operations, strategic partnerships and joint ventures in each of these regions.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Aircraft backlogs</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In calendar 2011, commercial aircraft OEMs Boeing and Airbus received 2,224 net orders for new aircraft (firm orders minus cancellations), compared to 1,104 net orders in calendar 2010. Boeing and Airbus are working through a record backlog of more than 8,200 aircraft, which should help generate opportunities for CAE with its full offering of training products and services. In calendar 2011, Boeing and Airbus reported a total of 1,011 airplane deliveries, compared to 972 deliveries in calendar 2010. Airbus and Boeing have announced a succession of upcoming significant production increases of key models such as the Airbus A320-family and A330, and Boeing&#146;s B737NG and B777. Higher aircraft deliveries should translate into higher demand for training products and services.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6 | CAE Third Quarter Report 2012</FONT></P>
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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">More efficient and more technologically advanced aircraft platforms</FONT></I></B></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Airlines demand more efficient aircraft</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Commercial aircraft OEMs have announced plans to introduce, or have already introduced, new, more efficient platforms. Some examples include the new Boeing 737 MAX, the Boeing 747-8 and 787, Airbus A350 XWB and Airbus A320neo, Mitsubishi MRJ, COMAC ARJ21, Russia&#146;s UAC SSJ100 and the Bombardier CSeries. The demand for these new, more efficient platforms is driven by high fuel prices, and, as fuel accounts for a significant portion of an airline&#146;s operating costs, airlines are actively seeking ways to reduce this cost. The International Air Transport Association (IATA) estimates that every dollar increase in the price of a barrel of oil adds US&#36;1.6 billion in costs for the global airline industry. Jet fuel prices are expected to remain above US&#36;100 per barrel in calendar 2012, according to the Organisation for Economic Co-operation and Development (OECD), necessitating the need for these new platforms.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Business jet operators demand high performance aircraft</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Business aircraft OEMs have announced plans to introduce, or have already introduced, a variety of new aircraft models incorporating the latest technologies to enhance performance and operator benefits such as range, speed, comfort and the accessibility of business air travel. Some examples include the Embraer Phenom 100 VLJ and 300 LJ aircraft, the Bombardier Learjet 85, Global 7000 and 8000, as well as the Cessna Citation M2 and Latitude.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">These more efficient and more technologically advanced aircraft platforms will drive the demand for new types of simulators and training programs. One of our strategic priorities is to partner with manufacturers to position ourselves for future opportunities. Similar to the contract signed during fiscal 2010 with Bombardier for the CSeries aircraft, we signed, in fiscal 2011, agreements with ATR for the new ATR42/72-600 aircraft, Mitsubishi Aircraft Corporation for the new MRJ, and with Airbus for the A350 XWB to leverage our modeling, simulation and training expertise to deliver training solutions, including CAE 7000 Series FFS, CAE Simfinity</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">TM </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">procedures trainers, comprehensive training programs and expansion of our network to meet airlines&#146; training needs. Deliveries of new-model aircraft are subject to program delays, which in turn affect the timing of FFS orders and deliveries.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Aircraft re-fleeting by legacy airlines</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Legacy airlines have been taking steps to renew their aging aircraft fleets. The recent order activity in the U.S. from Boeing and Airbus, for example from customers such as American Airlines and Southwest Airlines, highlights the potential for greater penetration of new generation of aircraft in the U.S. air transportation system.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Long-term demand and shortage of trained aviation professionals (pilots, maintenance, cabin crew)</FONT></I></B></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Worldwide demand is expected to increase over the long term</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growth in the civil aviation market has driven the demand for pilots, maintenance technicians and cabin crew worldwide, resulting in a shortage of qualified professionals in several markets. Pilot supply constraints include aging crew demographics, fewer military pilots transferring to civil airlines and low enrolment in technical schools. In emerging markets such as India, China, Latin America, the Middle East and Southeast Asia, long-term air traffic growth is outpacing the growth in mature markets and this trend is expected to continue.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">New pilot certification process requires simulation-based training</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation-based pilot certification training is beginning to take on an even greater role with the Multi-crew Pilot License (MPL) certification process developed by the International Civil Aviation Organization (ICAO), which has been adopted by several individual national aviation authorities around the world. The MPL process places more emphasis on simulation-based training to develop ab initio students into First Officers for modern aircraft. We launched the CAE MPL course in fiscal 2010; graduates of our MPL program are now flying. If the MPL process continues to be adopted and gains momentum in emerging markets like China, India, Southeast Asia, Eastern Europe and the Middle East where there is the greatest need for a large supply of qualified pilots trained in an efficient and effective manner, it would result in increased use of simulation-based training.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Continued strong regulatory environment</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">On August 1, 2010, the United States approved the </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Airline Safety and Federal Aviation Administration Act of 2010. </FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This Act requires the FAA to develop and issue new and updated regulations with effective dates between August 2012 and August 2013 for significant issues such as:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Flight and duty time limitations, and rest requirements;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The use of flight simulation training devices in areas that are critical to safety, such as airplane stalls, airplane upsets, airplane</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">icing, wind shear and other adverse weather phenomena;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Proposed increased qualification requirements for airline pilot certification.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">These new pilot training requirements could potentially drive more immersive simulation and more use of simulation for mission training.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 7</FONT></P>
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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">MILITARY MARKET</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We generate revenue across the defence market value chain by offering solutions to help maintain and enhance our customers&#146; mission readiness and decision-making capabilities. We provide simulation products such as full-mission simulators (FMS); we perform updates and upgrades to simulators; we provide maintenance and support services; we offer turnkey training services; we have a range of capabilities to provide simulation-based professional services for analysis, training and operational decision-making; and we have a software business called Presagis, which develops and sells commercial-off-the-shelf (COTS) modeling and simulation software solutions to OEMs, government agencies and defence forces.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We approach the world&#146;s defence markets by leveraging our global footprint and our in-country expertise. We have local presence and centres of excellence in key markets including Australia, Canada, Germany, India, Singapore, the U.K and the U.S. We have developed global operating processes which allow us to place a high level of decision-making autonomy within the regions while leveraging the full breadth of our products, services and capabilities which results in greater efficiency and stronger customer relationships.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Simulation Products/Military (SP/M)</FONT></B></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Designs, manufactures and supplies advanced military training equipment and software tools for air forces, armies and navies</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our SP/M segment is a world leader in the design and production of military flight simulation equipment. We develop simulation equipment, training systems and software tools for a variety of military aircraft, including fast jets, helicopters, maritime patrol and tanker/transport aircraft. We also offer simulation-based solutions for land and naval forces, including hands-on trainers and virtual maintenance trainers for the U.S. Army&#146;s Abrams tank and Bradley fighting vehicle. We have designed the broadest range of military helicopter simulators in the world, and we have also developed more training systems for the C-130 Hercules transport aircraft than any other company. We have delivered simulation products and training systems to more than 50 defence operators in approximately 35 countries, including all of the U.S. services.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Training &amp; Services/Military (TS/M)</FONT></B></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Supplies turnkey training services, maintenance and support services, simulation-based professional services and in-service support solutions</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our TS/M segment provides turnkey training services and training systems integration expertise to global defence forces, such as the Medium Support Helicopter Aircrew Training Facility (MSHATF) at Royal Air Force (RAF) Benson in the U.K., the Operational Training Systems Provider (OTSP) program for the Canadian Forces, the German Army Aviation School at Buckeburg, and the KC-135 Aircrew Training System for the United States Air Force (USAF) at 13 U.S. and international bases. We also provide a range of training support services such as contractor logistics support, maintenance services and simulator training at approximately 70 sites around the world. TS/M additionally provides a variety of modeling and simulation-based professional and defence services, and offers a range of in-service support solutions such as systems engineering and lifecycle management.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Market trends and outlook</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We continue to see a good number of opportunities globally for our modeling and simulation-based solutions. These opportunities are increasingly originating from regions with growing defence budgets, like Asia and the Middle East, where CAE has an established presence. Overall, militaries are still spending, however the contract award process has become slower, causing some programs to be delayed. Three important factors help to distinguish our defence business. First, we have a uniquely global position that gives us balance and diversity across the world&#146;s defence market. Second, we have a strong, experienced position on aircraft platforms that are expected to have a long program life. Third, and most fundamentally, simulation-based training provides considerable value as defence forces operate in a constrained budget environment yet still need to train and maintain troops&#146; readiness.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Global position</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE&#146;s military business has, since its inception, been globally diversified as the majority of global defence expenditures have been outside the Canadian domestic market. Approximately 1/3 of our business comes from the U.S., 1/3 from Europe and 1/3 from the rest of the world. We are currently working from a solid backlog and continue to see a broad pipeline of global opportunities despite known pressures on governments, mainly in the U.S., continental Europe and the U.K., to reduce defence spending in order to achieve fiscal reforms. These pressures have led to some program delays and reductions, which has made it more difficult to predict the timing and size of opportunities in the U.S. and Europe. Nations, such as Germany and the U.K., are in the process of reducing their force structures, which will result in fewer personnel requiring training on the affected platforms, which may impact our future business. Yet at the same time, emerging markets such as India, other Asian countries and the Middle East are planning growth in defence expenditures and we are well positioned in these regions. Since our interests span across a broad range of more than 50 defence operators in approximately 35 countries, our military business is diversified across markets experiencing various rates of defence expenditure.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">8 | CAE Third Quarter Report 2012</FONT></P>
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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Platform position</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We have made a conscious effort over the last several years to position the company on aircraft platforms that we believe have long program lives ahead of them. We are mainly involved with the air domain on platforms such as helicopters, transport aircraft, tankers, maritime patrol, and lead-in fighter trainer aircraft. We have a good track record for delivering programs on time and on budget and we are well positioned to provide defence forces with simulation and training solutions on a range of these type of military platforms. These aircraft segments specifically include the C-130J transport aircraft, P-8A Poseidon and P-3C Orion maritime patrol aircraft, KC-46A tanker, A330 Multi-Role Tanker Transport, NH90 helicopter, M-346 and Hawk lead-in fighter trainers, S-70 and H-60 helicopter variants, CH-47 Chinook heavy-lift helicopter, Unmanned Aerial Systems (UAS) and other aircraft that form part of the backbone of defence forces globally. Thus far, while in some markets these platforms are not completely immune to pressures, platforms involving helicopters and airlift/transport aircraft, which serve both defence and humanitarian operations, have been relatively less exposed to reductions when compared to platforms like combat aircraft (i.e. fighters). In the U.S., planned budget cuts have so far not materially impacted programs where we have a strong position, and we do not anticipate impacts to programs such as the MH-60S/R, C-130J, P-8A, and others. In the U.K., the announcement in calendar 2011 that the Royal Air Force will acquire 14 additional CH-47 Chinook helicopters is positive news for our MSHATF. Our positive long-term outlook is supported by the expectation that aircraft types such as the C-130 and CH-47, which serve critical military as well as humanitarian roles, will continue to be in demand globally. These platforms are comprised of newer aircraft types with long program lives ahead of them and we believe this will drive opportunities for us over the next decade.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Value of simulation-based training</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Industry research studies suggest that simulation-based solutions will be well placed to address some of the budget challenges facing defence operators. For example, a market research study by ASD Reports in calendar 2012 estimates that military pilot training done in simulators will increase from an estimated 50% in 2011 to almost 80% percent by 2021. We view ourselves as fundamentally being part of the solution to achieving lower training costs while maintaining or improving readiness. To date we have seen some of our defence customers move to increase their use of simulation-based training in an effort to achieve operational savings, and we expect this kind of activity to continue over the long term, even as force structures in some countries contract. The heads of defence forces and governments have expressed their explicit desire to move more training hours from actual weapon systems platforms to simulators as a means of achieving recurring savings. In the near term, though, the urgency of budget reductions has meant that the first priority for defence forces is finding areas to cut and then secondly, to look for ways to save going forward, which we believe will lead to increased use of simulation. We also continue to pursue new growth opportunities by expanding our core capabilities to other defence domains such as land vehicle and professional services.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Market drivers and our position</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We believe that we are uniquely positioned in the current environment to be part of the solution to reducing the cost of military readiness. Demand for our products and services should be driven by the:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Explicit desire of governments and defence forces to increase the use of modeling and simulation;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growing demand for our specialized modeling and simulation-based products and services;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">High cost of operating live assets for training which leads to more use of simulation;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Current and future nature of warfare requires joint forces training and mission rehearsal;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growing demand for traditional home station training.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Explicit desire of governments and defence forces to increase the use of modeling and simulation</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Governments and defence forces have demonstrated an explicit desire to increase the use of modeling and simulation for analysis, training, and operational decision-making. These sentiments are expressed by militaries globally, especially by the U.S. and other defence forces facing budget challenges. Unlike civil aviation where the use of simulators for training is common practice, there are no requirements to train in simulators in defence, therefore the level of adoption has traditionally been much lower. Simulation offers a number of advantages that address an ever increasing global threat level and new economic constraints that are pressuring top-line defence spending. The cost savings from the use of modeling and simulation are considerable. The USAF estimates that live training is approximately 10 times more costly than simulation-based training. According to the Department of Defence Fiscal Year 2012 budget request, the USAF officials, in an effort to reduce costs, have proposed cutting the service&#146;s flight training budget. The USAF promises that, by spending more time in &#147;advanced simulator training&#148;, aircrews will make up the lost flight training. The cost of fuel, detrimental environmental impacts, and significant wear and tear on weapon systems and aircraft all point to greater use of simulation and synthetic training. This type of training is critical for ensuring the readiness of global defence forces as they face new and challenging threats.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Growing demand for our specialized modeling and simulation-based products and services</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">New aircraft platforms</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">One of our strategic priorities is to partner with manufacturers in the defence market to strengthen relationships and position ourselves for future opportunities. OEMs are introducing new platforms that will drive worldwide demand for simulators and training. For example, Boeing is developing a new maritime patrol aircraft called the P-8A Poseidon and has won the U.S. Air Force contract for new air refueling tankers, NH Industries is delivering the NH90 helicopter, Airbus Military is aggressively marketing the A330 MRTT, A400M and C-295 transport aircraft worldwide, Lockheed Martin is doubling production of the C-130J aircraft, Alenia Aermacchi is successfully marketing the M-346 advanced lead-in fighter trainer and Sikorsky is offering new models of its H-60 helicopter to armies and navies worldwide, all of which fuel the demand for new simulators and training, and for all of which we have products at different development and production stages.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 9</FONT></P>
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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Use of modeling and simulation for analysis and decision support</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Traditionally, modeling and simulation have been used to support training. This specific application is well understood and employed by militaries and civilian agencies around the world. We believe there are growth opportunities in taking the simulation out of the simulator and applying simulation across the program lifecycle, including support for analysis and decision-making operations. We see governments and militaries looking to use simulation-based synthetic environments to support research and development programs, system design and testing, intelligence analysis, integration and exploitation, and to provide the decision support tools necessary to support mission planning in operations. As an example, we developed a National Modelling and Simulation Centre (NMSC) for the Ministry of Defence of Brunei. The NMSC is being used by the Royal Brunei Armed Forces and Ministry of Defence to analyze force structure options, evaluate and validate capabilities, develop doctrine and tactics, and support training and mission rehearsal exercises.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Trend towards outsourcing of training and maintenance services</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">With finite defence budgets and resources, defence forces and governments continue to scrutinize expenditures to find ways to reduce costs and allow active-duty personnel to focus on operational requirements. There has been a growing trend among defence forces to outsource a variety of training services and we expect this trend to continue. Governments are outsourcing training services because they can be delivered more quickly and more cost effectively. We have participated in contracts of this nature in Canada, Germany, Australia, the U.K. and the U.S. In fiscal 2011, we announced that CAE USA was awarded an expected ten-year contract (subject to annual funding) to provide comprehensive KC-135 aircrew training services to the USAF. CAE USA is the prime contractor responsible for providing program management, academic and simulator instruction, maintenance and logistics services, training device upgrades, and relocation services for more than 3,500 USAF KC-135 tanker aircrews. In Australia, we have delivered a suite of KC-30A MRTT training devices and following entry into service, we will provide comprehensive training services, including classroom and simulator instruction to the Royal Australian Air Force.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Extension and upgrade of existing weapon system platforms</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">OEMs are extending the life of existing weapon system platforms by introducing upgrades or adding new features, which increases the demand for upgrading simulators to meet the new standards. For example, several OEMs are offering global militaries operating C-130 aircraft a suite of avionics upgrades, which in turn leads to a requirement for major upgrades to existing C-130 training systems or potential new C-130 training systems. We recently won a contract to perform a major upgrade to the Canadian Forces&#146; existing CC-130H FMS. The USAF is also upgrading 52 legacy C-5 aircraft to the new C-5M configuration, which includes both avionics upgrades and a re-engining program. In fiscal 2011 we won a competitive contract to perform upgrades on the USAF&#146;s C-5 training devices over the next several years. The award of the USAF KC-135 Aircrew Training System has provided us with a contract vehicle for performing upgrades to all the KC-135 training devices resulting from major aircraft upgrades and simulator obsolescence.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">High cost of operating live assets for training which leads to more use of simulation</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">More defence forces and governments are adopting simulation in training programs because it improves realism, significantly lowers costs, reduces operational demands on aircraft that are being depreciated faster than originally planned, and lowers risk compared to operating actual weapon system platforms. Using a simulator for training also reduces actual aircraft flying hours and allows training for situations where an actual aircraft and/or its crew and passengers would be at risk.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Current and future nature of warfare requires joint forces training and mission rehearsal</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Demand for networking</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Allies are cooperating and creating joint and coalition forces which are driving the demand for joint and networked training and operations. Training devices that can be networked to train different crews and allow for networked training across a range of platforms are increasingly important as the desire to conduct mission rehearsal exercises in a synthetic environment increases.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growing adoption of synthetic training for mission rehearsal</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">There is a growing trend among defence forces to use synthetic training to meet more of their training requirements. Simulation technology solutions enable defence customers to plan sophisticated missions and carry out full-mission rehearsals in a synthetic environment as a complement to traditional live training or mission preparation. Synthetic training offers militaries a cost-effective way to provide realistic training for a wide variety of scenarios while ensuring they maintain a high state of readiness. For example, at our MSHATF in the United Kingdom, we have provided pre-deployment training to the Royal Air Force and other allied forces prior to Afghanistan deployments.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Growing demand for traditional home station training</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">With the United States and allies in the process of reducing the number of troops deployed to support operations in Afghanistan and elsewhere, there will be a growing demand for traditional home station training. When the troops are not involved in actual operations, military forces need to train to maintain the troops&#146; skills and readiness. Most militaries expect to rebalance the mix of live, virtual and constructive training. For example, the U.S. Army is planning to reduce the use of live training ranges and transfer some of this training to virtual and constructive simulation to reduce costs. This will ultimately create opportunities for training devices and training services. However, most militaries are also planning to reduce force levels, which will impact the existing and future training infrastructure required.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10 | CAE Third Quarter Report 2012</FONT></P>
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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">NEW CORE MARKETS (NCM)</FONT></B><BR>
<BR>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Healthcare market</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation-based training is becoming recognized as one of the most effective ways to prepare healthcare practitioners to care for patients and respond to critical situations while reducing the overall risk to patients. Through acquisitions and partnerships with experts in the healthcare field, we are leveraging our knowledge, experience and best practices in simulation-based aviation training to work with healthcare experts to deliver innovative education, technologies and service solutions to improve the safety and efficiency of this industry. Our objective is to offer realistic and comprehensive tools that will help students and practitioners sharpen their skills and prepare for better patient outcomes. Our offering, which integrates simulation and modeling, ranges from creating learning programs to deploying a wide range of specialty-based simulators.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We generate revenue in five main areas: patient simulators, surgical simulators, ultrasound simulators, learning modules/curriculum and centre management system. Our patient simulators offer a high level of believability and life-like accuracy and teach students and healthcare practitioners to intervene quickly in trauma scenarios with appropriate clinical measures. Our surgical simulators incorporate haptic technology designed to allow students and practitioners to practice and acquire skills to perform minimally invasive procedures, including bronchoscopies, endoscopies and cardiac valve replacements. Our ultrasound simulators combine e-learning, a mannequin and real time 3D animated display that allows students and practitioners to become familiar with diagnostic bedside ultrasound. Our simulation learning programs, such as our learning modules, e-learning and mobile applications provide simulation tools which can be embedded within hospital work environments or large teaching institutions which maximize time available for student-learning through remote delivery of content and allows for self-guided learning experiences and assessment. Our medical simulation centre solutions are designed to simplify the logistics behind managing complex simulation, assessment, recording and debriefing, scheduling and event activities and student learning.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Following the acquisition of Medical Education Technologies, Inc. (METI) during the second quarter of fiscal 2012, CAE Healthcare has now become a leader in simulation-based technology for healthcare. METI is a worldwide leader in medical simulation technologies and education software with approximately 6,000 simulators in medical schools, nursing schools, hospitals, defence forces and other entities. CAE Healthcare now has offices located in Canada, the U.S., Hungary and Germany and has over 300 employees that work with a team of 50 clinical educators and a network of more than 40 distributors in 40 countries.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Market trends and outlook</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The Healthcare simulation-based market is today focused mainly on education, consisting of the operation, maintenance and procurement of all types of simulation technology, and ranges from about &#36;750 million to upward of &#36;1 billion. Of that, approximately &#36;150 million is represented by the human patient simulation market, which is expected to grow in the double-digit range over the next several years, driven by the need for greater patient safety and better efficiency and effectiveness of healthcare education using simulation technology. Our vision is for CAE Healthcare to lead broad adoption of simulation-based training solutions for healthcare practitioners, improve patient safety and ultimately save more lives.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Medical simulation allows students and practitioners to practice procedures in an environment where errors do not result in unwanted circumstances. Medical errors result in 50,000 to 100,000 fatalities per year in the U.S. alone, according to the Institute of Medicine's (IOM) published report, &#147;To Err is Human: Building a Safer Health System&#148;. Medical simulators can help to reduce procedural errors by working to fundamentally change the competency assessment and training of healthcare practitioners, just as flight simulators revolutionized pilot certification and training decades ago. In addition to the 793,000 physicians and 67,000 medical students, there are approximately 3 million nurses and 250,000 nursing students in the U.S. and 8.8 million physicians and 14.5 million nurses worldwide.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The demand for our products and services is driven by the:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Use of patient simulators;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Increased adoption of minimally-invasive surgery;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Advances in imaging technology applications in healthcare;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Increasing healthcare costs;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Service provider shortages.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Use of patient simulators</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Patient simulators are the most commonly used simulators in the healthcare education and training markets. Patient simulators have been designed and developed to support a variety of applications in the education and training of practitioners. Human patient simulation provides an opportunity to reduce medical errors and their severity while improving patient care by enabling tailored clinical learning experiences to provide opportunities to train for high-risk, low-frequency events.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Human patient simulation can also provide practitioners with an opportunity to practice care for a simulated patient with acute problems, such as airway obstruction or cardiac arrest, hemorrhage, shock, or various other common emergent situations. Using simulators, healthcare team members can work through each clinical situation by assessing the presenting symptoms, providing appropriate interventions, and managing the simulator&#146;s response to the various treatments.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 11</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Increased adoption of minimally-invasive surgery</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Minimally-invasive surgery (MIS) is accomplished through small surgical incisions, specialized surgical instruments, and endoscopic or other alternative surgical imaging. Due to the advantages of MIS (reduced patient trauma and shorter hospitalization periods), it has seen increased adoption and utilization in a number of previously invasive surgical procedures. Continuing advances in surgical technology and MIS techniques for a variety of procedures have established surgery as the leading market application for simulation technology in healthcare.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Advances in imaging technology applications in healthcare</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Advanced imaging technology integration into healthcare industry practices has increased due to regulatory healthcare reform, the development of affordable technology-driven products and growing industry awareness of the advantages of technology implementation. Increasing patient awareness of alternative technological options in surgery and other medical procedures have also helped to pressure insurers and service providers into accepting and implementing information technologies and advanced imaging technologies. For example, bedside ultrasonography has become an invaluable tool in the management of critically ill patients. The hand-carried ultrasound (HCU) has tremendous potential to immediately provide diagnostic information at the bedside not assessable by a physical examination alone. Provided that healthcare practitioners performing point-of-care examinations with the HCU have adequate training, the HCU has the potential to become a tremendous advantage for bedside assessment and treatment of intensive care unit (ICU) patients.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Increasing healthcare costs</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growth and costs of primary care services are correlated to general population growth and healthcare coverage expansion. Longer life expectancy and the baby boomer generation have generated significant demand for services associated with chronic illnesses and aging populations. In addition, general consensus exists among health economists that the rise in healthcare costs and spending is principally the result of widespread adoption of medical technologies and a greater number of advanced medical services and treatments during inpatient and outpatient visits. Widespread adoption of medical technologies and a greater number of advanced medical services could ultimately translate into higher demand for training products and services.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Service provider shortages</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Shortages of primary care or family medicine physicians and specialty-medicine physicians are expected to occur. Virtual medical and surgical simulators will aid in the education and training of physicians and medical professionals, by helping to relieve bottlenecks and improve the effectiveness of training. An aging population is driving an increasing need for healthcare delivery while the aging healthcare workforce is resulting in increasing turnover risk at hospitals. According to the U.S. Department of Health and Human Services, "the U.S. will require 1.2 million new RNs [Registered Nurses] by 2014 to meet the nursing needs of the country, 500,000 to replace those leaving practice and an additional 700,000 new RNs to meet growing demands for nursing services". As students graduate and move into clinical practice, there is a growing need among hospitals for on-boarding programs that transition the new nurse to competent practitioner effectively and efficiently. Simulation is now moving from the academic setting into clinical practice as a means to provide a safe environment for clinical training.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Mining market</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We have customers in over 90 countries that are currently supported by our offices in Canada, the U.S., the U.K., South Africa, Australia, India, Kazakhstan, Brazil, Peru and Chile. We provide products and services for open pit and underground operations to mining organizations, from large diversified miners to junior miners and consultancies.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We generate revenue by delivering solutions in all parts of the mining market value chain. Solutions consist of one or more products or services from our five lines of business. Our software is used for managing geotechnical data, geological modeling for economic evaluation, mine strategy, design and production. Our consulting services provide advice for concept, pre-feasibility and feasibility studies along with mine planning services for operating mines. Our training services range from teaching the fundamentals of using our software to in-depth professional development covering complex multi-disciplinary techniques. Our remote sensing devices are used to capture images of mine faces that are used to create 3D images for structural analysis. Our operations centres provide services to design, construct, integrate and manage operation centres.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Market trends and outlook</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our technology and services are used by customers to increase productivity and improve safety. The factors driving demand for our technology and services are:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Greater need for operational efficiency to optimize yields from currently operating mines;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Increased activity in exploration and mining due to higher commodity prices;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Industry skills shortages due to rapid expansion in new mines;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Declining grades and higher energy consumption resulting in increased cost of extraction;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Health and safety priority.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12 | CAE Third Quarter Report 2012</FONT></P>
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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Greater need for operational efficiency to optimize yields from currently operating mines</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In the last 30 years the average grade of ore bodies in some mining regions of the world has halved, while the waste removed to access the minerals has more than doubled. Given the volatility of mineral prices and energy costs, a different approach is needed within the industry to maximize value and maintain the viability of current operations, to focus on maximizing metal recovery instead of simply maximizing throughput.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Increased activity in exploration and mining due to higher commodity prices</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Commodity prices are driven by supply and demand. Increased consumerism and urbanization in emerging markets are fueling growth in demand for raw materials, particularly for bulk materials such as iron ore and coal although economic conditions in the U.S. and Europe are dampening growth in mature markets.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The world&#146;s largest miners have collectively announced the investment of more than &#36;300 billion for capital programs. Investment in new supply is increasingly focused on deposits in more remote territories or those requiring more complex development. Much of the exploration activity is being performed by junior miners who are investing in drilling programs to determine mineral resources and ore reserves.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Industry skills shortages due to rapid expansion in new mines</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Skill shortages in many regions are putting upward pressure on wages and project costs. Without significant increases in the number of skilled workers or the introduction of new technology to expand production with fewer workers, growth in supply will be constrained.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Declining grades and higher energy consumption resulting in increased cost of extraction</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average grades have been trending lower while energy consumption has been on the rise, leading to a significant change in the cost base of the industry. Large mining organizations are requiring multi-disciplinary expertise to help address complex industry-wide challenges.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Health and safety priority</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Health and safety standards continue to be an area of focus for improvement through the use of technological advances and increased skills training to create a more highly skilled and better-educated work force. Mining companies are focusing on automated equipment, remote control of operations and simulation-based training of the workforce as means to improve overall safety.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">4. FOREIGN EXCHANGE</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We report all dollar amounts in Canadian dollars. We value assets, liabilities and transactions that are measured in foreign currencies using various exchange rates as required by IFRS.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The tables below show the variations of the closing and average exchange rates for our three main operating currencies.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We used the closing foreign exchange rates below to value our assets, liabilities and backlog in Canadian dollars at the end of each of the following periods:</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=23%></TD>
     <TD width=17%></TD>
     <TD width=15%></TD>
     <TD width=12%></TD>
     <TD width=2%></TD>
     <TD width=14%></TD>
     <TD width=10%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">September 30</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">March 31</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Increase /</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Decrease</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(decrease)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">U.S. dollar (US&#36; or USD)</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.02</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.04</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(2</FONT></I></TD>
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%)</FONT></I></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.97</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">5</FONT></I></TD>
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Euro (&#128;)</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.32</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.40</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(6</FONT></I></TD>
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%)</FONT></I></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.38</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(4</FONT></I></TD>
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%)</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">British pound (&#163; or GBP)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.58</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.62</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(2</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.56</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">1</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We used the average foreign exchange rates below to value our revenues and expenses:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">September 30</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">December 31</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Increase</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Increase</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">U.S. dollar (US&#36; or USD)</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.02</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.98</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">4</FONT></I></TD>
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.01</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">1</FONT></I></TD>
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Euro (&#128;)</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.38</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.38</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">-</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.38</FONT></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">-</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">British pound (&#163; or GBP)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.61</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.58</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">2</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.60</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">1</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The effect of translating the results of our self-sustaining subsidiaries into Canadian dollars resulted in an increase in this quarter&#146;s revenue of &#36;2.2 million and an increase in net income of &#36;0.6 million, when compared to the third quarter of fiscal 2011. For the first nine months of fiscal 2012, the effect of translating the results of our self-sustaining subsidiaries into Canadian dollars resulted in a decrease in revenue of &#36;3.3 million and a decrease in net income of &#36;0.6 million when compared to the first nine months of fiscal 2011.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 13</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Three areas of our business are affected by changes in foreign exchange rates:</FONT></P>
<UL>
<LI>
<P align="justify"><B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Our network of training centres</FONT></B><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Most of our training network revenue and costs are in local currencies. Changes in the value of local currencies relative to the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canadian dollar therefore have an impact on the network&#146;s net profitability and net investment. Under IFRS, gains or losses in the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">net investment in a foreign operation that result from changes in foreign exchange rates are deferred in the foreign currency</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">translation adjustment (other reserves), which is part of the equity section of the consolidated statement of financial position. Any</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">effect of the fluctuation between currencies on the net profitability has an immediate translation impact on the consolidated income</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">statement and an impact on year-to-year and quarter-to-quarter comparisons.</FONT></P></LI>
<LI>
<P align="justify"><B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Our simulation products operations outside of Canada (Australia, Germany, India, Singapore, U.K and U.S.)</FONT></B><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Most of the revenue and costs in these operations from foreign operations are generated in their local currency except for some</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">data and equipment bought in different currencies from time to time as well as any work performed by our Canadian manufacturing</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">operations. Changes in the value of the local currency relative to the Canadian dollar therefore have a translation impact on the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">operation&#146;s net profitability and net investment when expressed in Canadian dollars.</FONT></P></LI>
<LI>
<P align="justify"><B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Our simulation products operations in Canada</FONT></B><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Although the net assets of our Canadian operations are not exposed to changes in the value of foreign currencies (except for</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">receivables and payables in foreign currencies), a significant portion of our annual revenue generated from Canada is in foreign</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">currencies (mostly the U.S. dollar and the euro), while a significant portion of our expenses are in Canadian dollars.</FONT><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We generally hedge the milestone payments of sales contracts denominated in foreign currencies to protect ourselves from some</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">of the foreign exchange exposure. Since less than 100% of our revenue is hedged, it is not possible to completely offset the effects</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">of changing foreign currency values, which leaves some residual exposure that can affect the consolidated income statement.</FONT><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We continue to hold a portfolio of currency hedging positions intended to mitigate the risk to a portion of future revenues presented</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">by the current high-level volatility of the Canadian dollar versus the U.S. currency. The hedges are intended to cover a portion of</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">the revenue in order to allow the unhedged portion to match the foreign cost component of the contract. With respect to the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">remaining expected future revenues, our manufacturing operations in Canada remain exposed to changes in the value of the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canadian dollar.</FONT><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In order to reduce the variability of specific U.S. and euro-denominated manufacturing costs, we hedge some of the foreign</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">currency costs incurred in our manufacturing process.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">5. NON-GAAP AND OTHER FINANCIAL MEASURES</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This MD&amp;A includes non-GAAP and other financial measures. Non-GAAP measures are useful supplemental information but may not have a standardized meaning according to GAAP. You should not confuse this information with, or use it as an alternative for, performance measures calculated according to GAAP. You should also not use them to compare with similar measures from other companies.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Backlog</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Backlog is a non-GAAP measure that represents the expected value of orders we have received but have not yet executed.</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For the SP/C, SP/M and TS/M segments, we consider an item part of our backlog when we have a legally binding commercial</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">agreement with a client that includes enough detail about each party&#146;s obligations to form the basis for a contract or an order;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Military contracts are usually executed over a long-term period and some of them must be renewed each year. For the SP/M and</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">TS/M segments, we only include a contract item in backlog when the customer has authorized the contract item and has received</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">funding for it;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For the TS/C and NCM segments, we include revenues from customers with both long-term and short-term contracts when these</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">customers commit to pay us training fees, or when we reasonably expect them from current customers.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The book-to-sales ratio is the total orders divided by total revenue in the period.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Capital employed</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital employed is a non-GAAP measure we use to evaluate and monitor how much we are investing in our business. We measure it from two perspectives: Capital used:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For the company as a whole, we take total assets (not including cash and cash equivalents), and subtract total liabilities (not</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">including long-term debt and the current portion of long-term debt);</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For each segment, we take the total assets (not including cash and cash equivalents, tax accounts and other non-operating</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">assets), and subtract total liabilities (not including tax accounts, long-term debt and the current portion of long-term debt, royalty</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">obligations, employee benefits obligations and other non-operating liabilities).</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Source of capital:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In order to understand our source of capital, we add net debt to total equity.</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">| CAE Third Quarter Report 2012</FONT></P></LI>
</UL>
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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Capital expenditures (maintenance and growth) from property, plant and equipment</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Maintenance capital expenditure is a non-GAAP measure we use to calculate the investment needed to sustain the current level of economic activity.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growth capital expenditure is a non-GAAP measure we use to calculate the investment needed to increase the current level of economic activity.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Free cash flow</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">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.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Gross profit</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Gross profit is a non-GAAP measure equivalent to the operating profit excluding research and development expenses, selling, general and administrative expenses and other (gains) losses &#150; net.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net debt</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">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.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Non-cash working capital</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-cash working capital is a non-GAAP measure we use to monitor how much money we have committed in the day-to-day operation of our business. We calculate it by taking current assets (not including cash and cash equivalents or the current portion of assets held-for-sale) and subtracting current liabilities (not including the current portion of long-term debt or the current portion of liabilities related to assets held-for-sale).</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Operating profit</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Operating profit is a 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.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Research and development expenses</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Research and development expenses are a financial measure we use to measure the amount of expenditures directly attributable to research and development activities that we have expensed during the period, net of investment tax credits and government contributions.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Return on capital employed</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Return on capital employed (ROCE) is a non-GAAP measure we use to evaluate the profitability of our invested capital. We calculate this ratio over a rolling four-quarter period by taking earnings from continuing operations attributable to equity holders of the Company excluding interest expense, after tax, divided by the average capital employed.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Revenue simulator equivalent unit</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue simulator equivalent unit (RSEU) is a financial measure we use to show the total average number of FFSs available to generate revenue during the period. For example, in the case of a 50/50 flight training joint venture, we will report only 50% of the FFSs deployed under this joint venture as an RSEU. If a FFS is being powered down and relocated, it will not be included as an RSEU until the FFS is re-installed and available to generate revenue.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Segment operating income (loss)</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating income or loss (SOI) is a non-GAAP measure and our key indicator of each segment&#146;s financial performance. This measure gives us a good indication of the profitability of each segment because it does not include the impact of any items not specifically related to the segment&#146;s performance. We calculate it by using segment operating profit, which excludes the net finance expense, income taxes, discontinued operations and other items not specifically related to the segment&#146;s performance.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Unfunded backlog</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Unfunded backlog is a non-GAAP measure that represents firm military orders we have received but have not yet executed for which funding authorization has not yet been obtained. We include unexercised options with a high probability that they will be exercised, but exclude indefinite-delivery/indefinite-quantity (IDIQ) contracts.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 15</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<TABLE border=0 cellspacing=0>
<TR>
	<TD nowrap valign=top width="2%">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">6.</FONT></B>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">CONSOLIDATED RESULTS</FONT></B><B><SUP><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2</FONT></SUP></B></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">6.1</FONT></B>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Results of our operations &#150; third quarter of fiscal 2012</FONT></B></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"></P>
	</TD>
</TR>
</TABLE>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=37%></TD>
     <TD width=5%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=7%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except per share amounts) </FONT></I><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">453.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">433.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">427.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">465.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">410.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cost of sales</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">300.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">296.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">288.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">311.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">274.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Gross profit</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">152.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">137.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">139.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">154.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">136.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">As of % of revenue</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">33.7</FONT></I></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">31.7</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">32.6</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">33.2</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">33.1</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Research and development expenses</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Selling, general and administrative expenses</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">62.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">59.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">62.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">67.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">61.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other (gains) losses - net</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(3.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(9.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Operating profit</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">77.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">63.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">72.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">77.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">70.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">As of % of revenue</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">17.1</FONT></I></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">14.7</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">16.8</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">16.7</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">17.1</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(1.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance expense</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">17.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">17.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance expense - net</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Earnings before income taxes</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">61.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">49.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">57.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">62.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">54.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income tax expense</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">15.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">13.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:7.500000pt">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">As a % of earnings before income taxes (tax rate)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">25</FONT></I></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">21</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">24</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">27</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">29</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net income</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">43.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">46.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Attributable to:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">45.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">43.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">45.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">43.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">46.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Earnings per share (EPS) attributable to equity holders</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">of the Company</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic EPS</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.18</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.17</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.18</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Diluted EPS</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.18</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.17</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.18</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Revenue was 5% higher than last quarter and 10% higher than the third quarter of fiscal 2011</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue was &#36;19.6 million higher than last quarter mainly because:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">SP/M&#146;s revenue increased by &#36;16.4 million, or 12%, mainly due to higher revenue on programs executed in North America and to a</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">favourable foreign exchange impact on the translation of U.S. operations;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">NCM&#146;s revenue increased by &#36;6.8 million, or 33%, mainly due to higher revenue from CAE Healthcare, resulting primarily from the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">integration of METI, acquired in August 2011;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">TS/M&#146;s revenue increased by &#36;4.4 million, or 7%, mainly due to a higher level of activity on our European maintenance and training</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">programs, increased volume on Canadian programs and a favourable foreign exchange impact on the translation of U.S.</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">operations. The increase was partially offset by a lower level of activity in our Professional Services business in the U.S.;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">TS/C&#146;s revenue increased by &#36;3.9 million, or 3%, mainly due to the positive effect from a stronger U.S. dollar against the Canadian</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">dollar and a higher demand in the emerging markets and in Europe. The increase was partially offset by a lower contribution from</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">ab initio training in Europe;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">SP/C&#146;s revenue decreased by &#36;11.9 million, or 13%, mainly due to lower revenue recorded in the quarter for sales of simulators</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">already manufactured, partially offset by higher production levels resulting from an increase in order intake.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-GAAP and other financial measures (see Section 5).</FONT><BR>
<BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue was $42.3 million higher than the third quarter of fiscal 2011 largely because:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM&#8217;s revenue increased by $16.0 million, or 144%, mainly due to higher revenue from CAE Healthcare, resulting primarily from</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>the integration of METI, and increased revenue from CAE Mining;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C&#8217;s revenue increased by $14.0 million, or 21%, mainly due to higher production levels resulting from an increase in order</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>intake, partially offset by less favourable hedging rates;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C&#8217;s revenue increased by $9.8 million, or 9%, mainly due to higher revenue generated in the emerging markets and in North</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and South America and the integration into our results of CHC Helicopter&#8217;s Helicopter Flight Training Operations (CHC Helicopter&#8217;s</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>HFTO), acquired in February 2011. The increase was partially offset by a lower contribution from ab initio training in Europe;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M&#8217;s revenue increased by $3.8 million, or 6%, mainly due to a higher level of activity on our European maintenance and training</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>programs, increased revenue on the U.S. KC-135 ATS program and higher revenue on programs executed in Canada. The</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>increase was partially offset by a lower level of activity in our Professional Services business in the U.S.;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M&#8217;s revenue remained stable.</FONT></P></LI></UL>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue year to date was $1,314.5 million, 13% or $149.3 million higher than the same period last year, largely because:</FONT></P>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD vAlign=top rowSpan=2 noWrap>&nbsp;&nbsp;&nbsp;&nbsp; </TD>

   <TD vAlign=top rowSpan=2 noWrap>

   <LI></LI></TD>

   <TD vAlign=top rowSpan=2 colSpan=2 noWrap>

   <P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C&#8217;s revenue increased by $62.7 million, or 32%, mainly due to higher production levels resulting from an increase in order </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>intake,&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>partially offset by less favourable hedging rates;<BR></FONT></P></TD></TR>

<TR></TR>

<TR>

   <TD vAlign=top rowSpan=3 noWrap></TD>

   <TD vAlign=top rowSpan=3 noWrap>

   <LI></LI></TD>

   <TD vAlign=top rowSpan=3 colSpan=2 noWrap>

   <P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C&#8217;s revenue increased by $33.1 million, or 10%, mainly due to higher revenue generated in all regions, as well as the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>integration&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>into our results of CHC Helicopter&#8217;s HFTO. The increase was <BR>partially offset by the negative effect from the stronger </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>dollar against the U.S. dollar and a lower contribution from ab initio training in Europe;<BR></FONT></P></TD></TR>

<TR></TR>

<TR></TR>

<TR>

   <TD vAlign=top rowSpan=2 noWrap></TD>

   <TD vAlign=top rowSpan=2 noWrap>

   <LI></LI></TD>

   <TD vAlign=top rowSpan=2 colSpan=2 noWrap>

   <P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM&#8217;s revenue increased by $31.9 million, or 119%, mainly due to more revenue from CAE Healthcare, resulting primarily from </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>the&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>integration of METI, and more revenue from CAE Mining;<BR></FONT></P></TD></TR>

<TR></TR>

<TR>

   <TD vAlign=top rowSpan=4 noWrap></TD>

   <TD vAlign=top rowSpan=4 noWrap>

   <LI></LI></TD>

   <TD vAlign=top rowSpan=4 colSpan=2 noWrap>

   <P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M&#8217;s revenue increased by $16.9 million, or 4%, mainly due to higher revenue on programs executed in the U.S. and the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>integration&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>of RTI International&#8217;s Technology Assisted Learning <BR>(TAL) business unit. The increase was partially offset by the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>completion&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>of a Canadian helicopter program in fiscal 2011, a lower level of activity on our Australian helicopter programs and<BR>&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>programs&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>executed in Europe, in addition to an unfavourable foreign exchange impact on the translation of U.S. operations;<BR></FONT></P></TD></TR>

<TR></TR>

<TR></TR>

<TR></TR>

<TR>

   <TD vAlign=top rowSpan=3 noWrap></TD>

   <TD vAlign=top rowSpan=3 noWrap>

   <LI></LI></TD>

   <TD vAlign=top rowSpan=3 colSpan=2 noWrap>

   <P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M&#8217;s revenue increased by $4.7 million, or 2%, mainly due to higher in-service support for a Canadian program and increased </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>revenue&nbsp;</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>generated on U.S. ATS programs, partially offset by <BR>a lower level of activity in our Professional Services business in the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>U.</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>S.</FONT></P></TD></TR>

<TR></TR>

<TR></TR></TABLE>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>You will find more details in </FONT><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>Results by segment</FONT></I><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Operating profit was $13.6 million higher than last quarter and $7.2 million higher compared to the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Operating profit for this quarter was $77.5 million, or 17.1% of revenue, compared to $63.9 million or 14.7% of revenue last quarter and $70.3 million or 17.1% of revenue in the third quarter of fiscal 2011. Excluding charges of $8.4 million related to the acquisition and integration of METI, which was acquired in August 2011, operating profit would have been $72.3 million last quarter.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Operating profit increased by 21% compared to last quarter. Increases in segment operating income of $7.2 million, $6.0 million, $1.2 million and $0.7 million for NCM, SP/M, TS/C and TS/M respectively, were partially offset by a decrease of $1.5 million for SP/C.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Operating profit increased by 10% over the third quarter of fiscal 2011. Increases in segment operating income of $5.3 million for SP/C and $4.6 million for TS/C were partially offset by decreases of $1.7 million, $0.9 million and $0.1 million for SP/M, TS/M and NCM respectively.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>For the first nine months of fiscal 2012, operating profit was $213.4 million, $8.6 million or 4% higher than operating profit for the same period last year. Increases in segment operating income of $17.3 million for TS/C and $12.2 million for SP/C were partially offset by decreases of $8.4 million, $8.1 million and $4.4 million for TS/M, NCM and SP/M respectively. Excluding charges of $8.4 million related to the acquisition and integration of METI, operating profit would have been $221.8 million for the first nine months of fiscal 2012.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>You will find more details in </FONT><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>Results by segment</FONT></I><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Net finance expense was $1.3 million higher than last quarter and $0.6 million higher than the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The net finance expense was higher than last quarter, mainly due to the new private placement of senior notes issued at the end of last quarter, resulting in higher interest this quarter.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase in the net finance expense over the third quarter of fiscal 2011 was mainly due to the new private placement of senior notes issued at the end of last quarter, resulting in higher interest this quarter, partially offset by lower interest on finance leases.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>For the first nine months of fiscal 2012, the net finance expense was $46.0 million, which was $1.2 million higher than the same period last year. The increase was mainly due to the new private placement of senior notes issued at the end of last quarter, resulting in higher interest this year, partially offset by an increase in capitalized interest for assets under construction, more interest income on loans and receivables and lower interest on finance leases.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 17</FONT></P></DIV>

<HR align=center SIZE=2 width="100%" noShade>



<DIV style="PAGE-BREAK-BEFORE: always"></DIV>

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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Effective income tax rate was 25% this quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Income taxes this quarter were $15.2 million, representing an effective tax rate of 25%, compared to 21% last quarter and 29% for the third quarter of fiscal 2011. Income taxes for the first nine months of fiscal 2012 were $39.1 million, representing an effective tax rate of 23%, compared to 28% for the same period last year.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The higher tax rate this quarter compared to last quarter was mainly attributable to the recognition of previously unrecognized tax assets last quarter resulting from net operating losses in the U.S. triggered by the acquisition of METI. Excluding that element, the income tax rate last quarter would have been 28%.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The lower tax rate this quarter compared to the third quarter of fiscal 2011 was mainly due to the settlement of a tax audit in Canada as well as the change in the mix of income from various jurisdictions.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>6.2 Consolidated orders and backlog</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Our consolidated backlog was $3,514.9 million at the end of this quarter. New orders of $385.8 million were added this quarter, while $453.1 million in revenue was generated from the backlog. The negative adjustment of $66.0 million was mainly due to foreign exchange.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="43%"></TD>

   <TD width="17%"></TD>

   <TD width="13%"></TD>

   <TD width="2%"></TD>

   <TD width="11%"></TD>

   <TD width="8%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Backlog down 4% compared to last quarter</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Three months ended</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3,648.2</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3,449.0</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ orders</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>385.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,400.1</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- revenue</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(453.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1,314.5</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ / - adjustments (mainly F/X)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(66.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(19.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3,514.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3,514.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The negative adjustment of $66.0 million was mainly due to foreign exchange. The adjustment was also due to the cancellation of an order in our SP/C segment and an adjustment made for a defence services program resulting from a delay in the performance of a delivery obligation by the OEM.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The book-to-sales ratio for the quarter was 0.85x. The ratio for the last 12 months was 1.05x.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>You will find more details in </FONT><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>Results by segment.</FONT></I></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7. RESULTS BY SEGMENT</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>We manage our business and report our results in five segments:</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Civil segments:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Training &amp; Services/Civil (TS/C);</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Simulation Products/Civil (SP/C).</FONT></P></LI></UL>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Military segments:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Simulation Products/Military (SP/M);</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Training &amp; Services/Military (TS/M).</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>New Core Markets (NCM) segment.</FONT></P></LI></UL>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Transactions between operating segments are mainly simulator transfers from the SP/C segment to the TS/C segment and are recorded at cost.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The method used for the allocation of assets jointly used by the operating segments and costs and liabilities jointly incurred (mostly corporate costs) between operating segments is based on the level of utilization when determinable and measurable, otherwise the allocation is based on a proportion of each segment&#8217;s cost of sales.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>18 | CAE Third Quarter Report 2012</FONT></P></DIV>

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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=34%></TD>
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	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">KEY PERFORMANCE INDICATORS</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Segment operating income (loss)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except operating margins)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Civil segments</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Civil</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">28.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">27.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">35.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">25.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">24.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">23.4</FONT></I></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">23.2</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">28.6</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">20.9</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">21.4</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Civil</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">13.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">16.4</FONT></I></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">15.9</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">11.3</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">12.3</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">11.8</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Military segments</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Military</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">26.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">18.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">34.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">28.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">17.7</FONT></I></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">15.4</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">13.9</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">19.0</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">18.6</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Military</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">10.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">14.3</FONT></I></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">14.2</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">14.9</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">15.4</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">16.5</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">New Core Markets</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(1.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total segment operating income (SOI)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">77.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">63.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">72.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">76.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">70.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Reversal of restructuring provision</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">-</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Operating profit</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">77.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">63.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">72.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">77.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">70.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Capital employed</FONT></B><B><SUP><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3</FONT></SUP></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Civil segments</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Civil</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,150.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,149.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,083.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,070.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,019.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Civil</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">65.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">62.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">83.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">58.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">86.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Military segments</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Military</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">266.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">262.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">282.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">197.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">224.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Military</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">199.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">190.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">205.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">177.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">182.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">New Core Markets</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">174.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">181.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">44.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">33.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,856.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,847.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,699.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,544.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,545.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">7.1 Civil segments</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">THIRD QUARTER OF FISCAL 2012 EXPANSIONS AND NEW INITIATIVES</FONT></B><B><SUP><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3</FONT></SUP></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We announced a joint venture with Cebu Pacific Air to establish the Philippine Academy for Aviation Training, Inc., an aviation</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">training centre for airlines in Clark Freeport Zone, Philippines. The joint venture will also be responsible for type-rating training of</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cebu Pacific Air pilots;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We have begun work on a new five-year Long-Term Support Agreement (LTSA) with US Airways. This represents the launch of a</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">new efficiency-oriented solution which enables aviation training centres to improve schedule predictability in planning multi-year</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">updates and reduces life-cycle training costs;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We broke ground, with InterGlobe Enterprises and Airbus, for a new pilot and maintenance technician training centre in Delhi,</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">India. The Delhi training centre is expected to start offering pilot and maintenance training solutions in calendar 2013 and will</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">eventually be able to train up to 5,000 pilots and technicians annually for airlines in India and the neighbouring region;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We announced that a new CAE 5000 Series FFS will be built for the Melbourne, Australia area in the first half of calendar 2012 for</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">the training of pilots and maintenance technicians for the Hawker Beechcraft King Air 350 aircraft with Pro Line 21 avionics;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We announced that Mexico's first business jet and civil helicopter training centre is open and ready for pilot training in Toluca. New</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">FFSs for the Bombardier Learjet 40/45 aircraft and the Bell 412 helicopter were recently qualified to Level D-equivalent standards</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">by Mexico's Direcci&oacute;n General de Aeron&aacute;utica Civil (DGAC);</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We announced that the CAE Flightscape and RUAG Aviation partnership has been selected by Dassault Falcon as the preferred</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Dassault authorized provider of Flight Data Monitoring Services (FDM) for all new production and in-service Falcon aircraft;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We announced that our training organization worldwide passed the rigorous requirements of Dassault Aviation's Falcon Training</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Policy Manual quality system audit. This is the highest level attainable by a flight training organization;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We inaugurated the expansion of our training centre for pilots and cabin crew with LAN Airlines S.A., a leading Latin American</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">airline for both passengers and cargo.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-GAAP and other financial measures (see Section 5).</FONT></P>
<P style="text-align: right;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 19</FONT></P>
</DIV>

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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=40%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=8%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">COMBINED FINANCIAL RESULTS</FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except operating margins)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">203.7</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">211.7</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">210.1</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">197.2</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">179.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">42.0</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">42.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">45.2</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">34.7</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">32.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Operating margins</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">20.6</FONT></I></B></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">20.0</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">21.5</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">17.6</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">17.8</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Backlog</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,469.3</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,466.0</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,311.6</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,290.3</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,098.5</FONT></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The combined civil book-to-sales ratio was 1.15x for the quarter and 1.24x on a trailing 12-month basis.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">TRAINING &amp; SERVICES/CIVIL</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">TS/C obtained contracts this quarter expected to generate future revenues of &#36;122.2 million, including:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A new exclusive training services contract with flydubai, through Emirates-CAE Flight Training (ECFT), the joint venture between</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Emirates Group and CAE;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">An extension of a pilot training contract for various aircraft with Dallas Jet International, based in the U.S.;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A new contract with Arabian Jets for pilot training services on eight business aircraft types at ECFT;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A long-term agreement with Qatar Executive, Qatar Airways' corporate jet subsidiary, for pilot training services on the Bombardier</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Global Express XRS (GEX) and the Bombardier Challenger 605 at ECFT.</FONT></P></LI>
</UL>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=43%></TD>
     <TD width=5%></TD>
     <TD width=11%></TD>
     <TD width=9%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=8%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Financial Results </FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except operating margins, RSEU and</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">FFSs deployed)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">123.0</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">119.1</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">124.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">121.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">113.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">28.8</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">27.6</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">35.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">25.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">24.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Operating margins</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">23.4</FONT></I></B></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">23.2</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">28.6</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">20.9</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">21.4</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Depreciation and amortization</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">21.0</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">19.6</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">19.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">18.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment expenditures</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">37.6</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">23.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">27.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">17.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Intangible assets and other assets expenditures</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2.3</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.4</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.9</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.8</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital employed</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,150.8</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,149.7</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,083.8</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,070.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,019.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Backlog</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,102.8</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,125.4</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">970.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">986.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">774.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">RSEU</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4</FONT></SUP></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">140</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">139</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">137</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">132</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">132</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">FFSs deployed</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">170</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">165</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">160</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">156</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">152</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=3>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Comparative figures for fiscal 2011 quarters have been restated to exclude NCM.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Revenue up 3% over last quarter and up 9% over the third quarter of fiscal 2011</FONT></B><B><SUP><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">4</FONT></SUP></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase over last quarter was mainly attributable to the positive effect from a stronger U.S. dollar against the Canadian dollar and a higher demand in the emerging markets and in Europe. The increase was partially offset by a lower contribution from ab initio training in Europe.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase over the third quarter of fiscal 2011 was mainly due to higher revenue generated in the emerging markets and in North and South America and the integration into our results of CHC Helicopter&#146;s HFTO, acquired in February 2011. The increase was partially offset by a lower contribution from ab initio training in Europe.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue year to date was &#36;366.1 million, &#36;33.1 million or 10% higher than the same period last year. The increase was mainly due to higher revenue generated in all regions, as well as the integration into our results of CHC Helicopter&#146;s HFTO. The increase was partially offset by the negative effect from the stronger Canadian dollar against the U.S. dollar and a lower contribution from ab initio training in Europe.</FONT></P>
<P style="text-align: left;">
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-GAAP and other financial measures (see Section 5).</FONT><BR>
<BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

<HR noshade align="center" width="100%" size=2><DIV STYLE="page-break-before: always"></div>


<!--$$/page=--><A name="page_25"></A><BR>

<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Segment operating income up 4% over last quarter and up 19% over the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income was $28.8 million (23.4% of revenue) this quarter, compared to $27.6 million (23.2% of revenue) last quarter and $24.2 million (21.4% of revenue) in the third quarter of fiscal 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income increased by $1.2 million, or 4%, over last quarter. The increase was mainly attributable to higher segment operating income generated in Europe, a higher contribution from CHC Helicopter&#8217;s HFTO and ab initio training.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income increased by $4.6 million, or 19%, over the third quarter of fiscal 2011. The increase was mainly due to higher segment operating income generated in the emerging markets and in North and South America, in addition to a gain from strategic expansion initiatives and the integration into our results of CHC Helicopter&#8217;s HFTO. The increase was partially offset by a lower contribution from ab initio training in Europe.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income year to date was $91.9 million (25.1% of revenue), $17.3 million or 23% higher than the same period last year. The increase was mainly attributable to higher segment operating income generated in North and South America, the emerging markets and Europe, gains from strategic expansion initiatives and the integration into our results of CHC Helicopter&#8217;s HFTO. The increase was partially offset by a lower contribution from ab initio training in Europe.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Property, plant and equipment expenditures at $37.6 million this quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Maintenance capital expenditures were $14.4 million for the quarter, which included the repurchase of leased simulators already included in our network, and growth capital expenditures were $23.2 million. As the civil aviation market trends and outlook point to prolonged global growth, we continue to selectively invest in our training network to keep pace with the growth of our customers, especially in the emerging markets, in both the commercial and business aviation sectors.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Capital employed increased by $1.1 million over last quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase in capital employed was mainly due to investments in our network and an increase non-cash working capital, mainly due to a decrease in accounts payable and accrued liabilities, partially offset by the impact of movements in foreign exchange rates.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="47%"></TD>

   <TD width="12%"></TD>

   <TD width="13%"></TD>

   <TD width="2%"></TD>

   <TD width="12%"></TD>

   <TD width="7%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Backlog was at $1,102.8 million at the end of the quarter</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Three months ended</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,125.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>986.5</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ orders</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>122.2</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>472.6</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- revenue</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(123.0</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(366.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ / - adjustments (mainly F/X)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(21.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,102.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,102.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>This quarter's book-to-sales ratio was 0.99x. The ratio for the last 12 months was 1.29x.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>SIMULATION PRODUCTS/CIVIL</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C was awarded contracts for the following 11 FFSs this quarter:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Airbus A320 FFS to Alpha Aviation Group;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Airbus A320 FFS to the Philippine Academy for Aviation Training, a joint venture between CAE and Cebu Pacific Air;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Airbus A320 FFS and one Boeing 737 FFS to Shanghai Eastern Flight Training Centre;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Airbus A320 FFS and one Boeing 737-800 FFS to Air China;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Airbus A380 FFS and one Boeing 777 FFS to Emirates;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One ATR 42/72-600 FFS to ATR;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Boeing 737 FFS to Shandong Airlines;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>One Bombardier Dash 8 Q400 FFS to Ethiopian Airlines.</FONT></P></LI></UL>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>This brings SP/C&#8217;s order intake for the year to 30 FFSs.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>During the quarter, the segment also received a cancellation of a simulator order from a prior year.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 21</FONT></P></DIV>

<HR align=center SIZE=2 width="100%" noShade>



<DIV style="PAGE-BREAK-BEFORE: always"></DIV>

<!--$$/page=--><A name="page_26"></A><BR>

<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="41%"></TD>

   <TD width="8%"></TD>

   <TD width="10%"></TD>

   <TD width="10%"></TD>

   <TD width="10%"></TD>

   <TD width="10%"></TD>

   <TD width="8%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Financial Results</FONT></B><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions, except operating margins)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Q3-2012</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q2-2012</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q1-2012</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q4-2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q3-2011</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>80.7</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>92.6</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>86.1</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>76.2</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>66.7</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>13.2</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>14.7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.4</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.9</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>Operating margins</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>%</FONT></I></TD>

   <TD align=right><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>16.4</FONT></I></B></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>15.9</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>11.3</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>12.3</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>11.8</FONT></I></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Depreciation and amortization</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.7</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.6</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment expenditures</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.3</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.1</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.1</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.3</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.4</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Intangible assets and other assets expenditures</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.5</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.9</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.4</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.0</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Capital employed</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>65.4</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>62.9</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>83.4</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>58.7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>86.8</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>366.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>340.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>341.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>303.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>324.3</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Revenue down 13% from last quarter and up 21% over the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The decrease from last quarter was mainly due to lower revenue recorded in the quarter for sales of simulators already manufactured, partially offset by higher production levels resulting from an increase in order intake.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase over the third quarter of fiscal 2011 was mainly due to higher production levels resulting from an increase in order intake, partially offset by less favourable hedging rates.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue year to date was $259.4 million, 32% or $62.7 million higher than the same period last year. The increase was mainly due to higher production levels resulting from an increase in order intake, partially offset by less favourable hedging rates.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Segment operating income down 10% from last quarter and up 67% over the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income was $13.2 million (16.4% of revenue) this quarter, compared to $14.7 million (15.9% of revenue) last quarter and $7.9 million (11.8% of revenue) in the third quarter of fiscal 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The decrease from last quarter was mainly due to lower volume and higher research and development expenses, partially offset by a favourable program mix.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase over the third quarter of fiscal 2011 was mainly due to a favourable program mix and higher volume, partially offset by an unfavourable foreign exchange impact.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income for the first nine months of the year was $37.6 million (14.5% of revenue), 48% or $12.2 million higher than the same period last year. The increase was mainly due to higher volume, an improvement in project margins and a favourable program mix, partially offset by an unfavourable foreign exchange impact.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Capital employed increased by $2.5 million over last quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Capital employed increased over last quarter mainly due to an increase in intangible assets. Non-cash working capital remained stable.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="38%"></TD>

   <TD width="22%"></TD>

   <TD width="12%"></TD>

   <TD width="2%"></TD>

   <TD width="12%"></TD>

   <TD width="7%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Backlog up 8% over last quarter</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Three months ended</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>340.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>303.8</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ orders</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>112.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>328.7</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- revenue</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(80.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(259.4</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ / - adjustments</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(5.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>366.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>366.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Adjustments in the third quarter of fiscal 2012 include the cancellation of an order, partially offset by a favourable foreign exchange impact.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>This quarter's book-to-sales ratio was 1.39x. The ratio for the last 12 months was 1.15x.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>22 | CAE Third Quarter Report 2012</FONT></P></DIV>

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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
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<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
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&nbsp;</TD>
</TR>
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	<TD align=left>
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">7.2</FONT></B></TD>
	<TD align=left>
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Military segments</FONT></B></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">THIRD QUARTER OF FISCAL 2012 EXPANSIONS AND NEW INITIATIVES</FONT></B></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We completed a major upgrade to one of the CH-47 Chinook dynamic mission simulators located at our Medium Support</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Helicopter Aircrew Training Facility (MSHATF) in the U.K., and the Royal Air Force (RAF) is now training its Chinook aircrews to</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">the new RAF CH-47 Mk4 standard. The simulator upgrade was done in parallel with the upgrades currently being performed on the</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">RAF&#146;s CH-47 Chinook fleet as part of the JULIUS program;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We inaugurated, through our Rotorsim s.r.l. joint venture with AgustaWestland, the launch of the Joint NH90 Training Program</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(JNTP) for the Netherlands Ministry of Defence;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We inaugurated, through our Helicopter Academy to Train by Simulation of Flying (HATSOFF) joint venture with Hindustan</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Aeronautics Limited (HAL), the launch of training for the Eurocopter AS365 N3 Dauphin helicopter in India. A CAE-built</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">AS365 Dauphin simulator cockpit was certified to Level D, the highest qualification for flight simulators, by India&#146;s Directorate</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">General Civil Aviation (DGCA) as well as the European Aviation Safety Agency (EASA).</FONT></P></LI>
</UL>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=40%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=8%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">COMBINED FINANCIAL RESULTS</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except operating margins)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">222.3</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">201.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">206.4</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">257.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">219.8</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">36.9</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">30.2</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">29.4</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">46.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.5</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Operating margins</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">16.6</FONT></I></B></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">15.0</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">14.2</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">17.9</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">18.0</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Backlog</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2,045.6</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2,182.2</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2,151.6</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2,158.7</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2,126.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The combined military book-to-sales ratio was 0.56x for the quarter and 0.89x on a trailing 12-month basis.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The combined military unfunded backlog was &#36;269.4 million at December 31, 2011.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">SIMULATION PRODUCTS/MILITARY</FONT></B><BR>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">SP/M was awarded &#36;67.5 million in orders this quarter, including:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Upgrades to the Canadian Forces&#146; CC-130H FMS and to the CH-146 Griffon helicopter simulator;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Two Tornado maintenance trainers, one for the German Air Force and one for the Royal Air Force;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">One CAE 3000 Series helicopter FFS to a European customer;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Additional contract options as part of the design and manufacturing of P-8A operational flight trainers for Boeing and the U.S.</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Navy.</FONT></P></LI>
</UL>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=41%></TD>
     <TD width=8%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=10%></TD>
     <TD width=8%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Financial results</FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except operating margins)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">152.4</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">136.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">135.2</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">179.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">153.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">26.9</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20.9</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">18.8</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">34.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">28.6</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Operating margins</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">%</FONT></I></TD>
	<TD align=right>
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">17.7</FONT></I></B></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">15.4</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">13.9</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">19.0</FONT></I></TD>
	<TD align=right>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">18.6</FONT></I></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Depreciation and amortization</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.1</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.9</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.7</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.9</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment expenditures</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2.6</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.0</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.8</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.2</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.5</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Intangible assets and other assets expenditures</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">5.4</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4.3</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.8</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital employed</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">266.7</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">262.5</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">282.7</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">197.9</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">224.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Backlog</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">812.7</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">907.4</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">897.8</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">888.7</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">883.0</FONT></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Revenue up 12% over last quarter and stable compared to the third quarter of fiscal 2011</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase over last quarter was mainly due to higher revenue on programs executed in North America and to a favourable foreign exchange impact on the translation of U.S. operations.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue was stable compared to third quarter of fiscal 2011. Lower volume on our European programs, on an Australian helicopter program and the completion of a Canadian helicopter program in fiscal 2011, was offset by higher revenue on programs executed in the U.S. and the integration of RTI International&#146;s TAL business unit, acquired in February 2011.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue year to date was &#36;423.6 million, 4% or &#36;16.9 million higher than the same period last year. The increase was mainly due to higher revenue on programs executed in the U.S. and the integration of RTI International&#146;s TAL business unit. The increase was partially offset by the completion of a Canadian helicopter program in fiscal 2011, a lower level of activity on our Australian helicopter programs and programs executed in Europe, in addition to an unfavourable foreign exchange impact on the translation of U.S. operations.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 23</FONT></P>
</DIV>

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<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Segment operating income up 29% from last quarter and down 6% from the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income was $26.9 million (17.7% of revenue) this quarter, compared to $20.9 million (15.4% of revenue) last quarter and $28.6 million (18.6% of revenue) in the third quarter of fiscal 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase from last quarter was mainly due to higher revenue, as mentioned above, and lower operational costs. The increase was partially offset by increased research and development expenses.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The decrease from the third quarter of fiscal 2011 was mainly due to lower volume on European programs, the completion of a Canadian helicopter program in fiscal 2011 and increased research and development expenses. The decrease was partially offset by a favourable program mix and higher revenue on programs executed in North America, and by the integration of RTI International&#8217;s TAL business unit.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income for the first nine months of the year was $66.6 million (15.7% of revenue), 6% or $4.4 million lower than the same period last year. The decrease was mainly due to a lower volume on programs executed in Europe, the completion of a Canadian helicopter program in fiscal 2011 and higher research and development expenses. The decrease was partially offset by higher volume in North America and the integration of RTI International&#8217;s TAL business unit.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Capital employed increased by $4.2 million over last quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase over last quarter was mainly due to a higher investment in non-cash working capital primarily resulting from lower accounts payable and accrued liabilities and derivative financial liabilities and higher accounts receivable and derivative financial assets which were partially offset by higher contracts in progress liabilities.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="40%"></TD>

   <TD width="20%"></TD>

   <TD width="13%"></TD>

   <TD width="2%"></TD>

   <TD width="12%"></TD>

   <TD width="7%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Backlog down 10% from last quarter</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Three months ended</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Dece</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>mber 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>907.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>888.7</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ orders</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>67.5</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>349.1</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- revenue</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(152.4</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(423.6</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ / - adjustments (mainly F/X)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(9.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>812.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>812.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>This quarter's book-to-sales ratio was 0.44x. The ratio for the last 12 months was 0.79x.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>TRAINING &amp; SERVICES/MILITARY</FONT></B><BR><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M was awarded $56.6 million in orders this quarter including:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A contract from Professional Way Sdn Bhd, a Malaysia-based company, to provide comprehensive maintenance and lifecycle</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>support services for the CAE 3000 Series AW139 FFS that we are currently developing;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A multi-year, comprehensive helicopter training services contract for a customer in Asia;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A subcontract from Lockheed Martin to continue providing maintenance and support services as part of the USAF C-130 Aircrew</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Training System program.</FONT></P></LI></UL>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="41%"></TD>

   <TD width="8%"></TD>

   <TD width="10%"></TD>

   <TD width="10%"></TD>

   <TD width="10%"></TD>

   <TD width="10%"></TD>

   <TD width="8%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Financial results</FONT></B><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions, except operating margins)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Q3-2012</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q2-2012</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q1-2012</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q4-2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Q3-2011</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>69.9</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>65.5</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>71.2</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>78.0</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>66.1</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.0</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.3</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>10.6</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>12.0</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>10.9</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>Operating margins</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>%</FONT></I></TD>

   <TD align=right><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>14.3</FONT></I></B></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>14.2</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>14.9</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>15.4</FONT></I></TD>

   <TD align=right><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>16.5</FONT></I></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Depreciation and amortization</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.0</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.0</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.9</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.1</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.0</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment expenditures</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.1</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.6</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.0</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.2</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.2</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Intangible assets and other assets expenditures</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.1</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.3</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.2</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.3</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.2</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Capital employed</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>199.0</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>190.7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>205.2</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>177.7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>182.4</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,232.9</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,274.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,253.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,270.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,243.4</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Revenue up 7% over last quarter and up 6% over the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase over last quarter was mainly due to a higher level of activity on our European maintenance and training programs, increased volume on Canadian programs and a favourable foreign exchange impact on the translation of U.S. operations. The increase was partially offset by a lower level of activity in our Professional Services business in the U.S.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase over the third quarter of fiscal 2011 was mainly due to a higher level of activity on our European maintenance and training programs, increased revenue on the U.S. KC-135 ATS program and higher revenue on programs executed in Canada. The increase was partially offset by a lower level of activity in our Professional Services business in the U.S.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>24 | CAE Third Quarter Report 2012</FONT></P></DIV>

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<DIV style="PAGE-BREAK-BEFORE: always"></DIV>

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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue year to date was $206.6 million, 2% or 4.7 million higher than the same period last year. The increase was mainly due to higher in-service support for a Canadian program and increased revenue generated on U.S. ATS programs, partially offset by a lower level of activity in our Professional Services business in the U.S.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Segment operating income up 8% over last quarter and down 8% from the third quarter of fiscal 2011</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income was $10.0 million (14.3% of revenue) this quarter, compared to $9.3 million (14.2% of revenue) last quarter and $10.9 million (16.5% of revenue) in the third quarter of fiscal 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase over last quarter was mainly due to increased volume on programs executed in Canada and maintenance programs in Europe, partially offset by a lower level of activity in our Professional Services business in the U.S.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The decrease from the third quarter of fiscal 2011 was mainly due to a lower level of activity in our Professional Services business in the U.S. and lower margins on some U.S. training programs, partially offset by increased volume on European maintenance programs and better execution of programs in Canada and Australia.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income for the first nine months of the year was $29.9 million (14.5% of revenue), 22% or $8.4 million lower than the same period last year. The decrease was mainly due to the ramp-up of the KC-135 ATS program, a lower level of activity in our Professional Services business in the U.S., lower volume and margins on some U.S. training programs and a lower dividend received from a U.K.-based TS/M investment. The decrease was partially offset by lower selling, general and administrative expenses and higher in-service support for a Canadian program.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Capital employed increased by $8.3 million over last quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase from last quarter was mainly due to a higher investment in non-cash working capital, primarily due to an increase in prepayments and a decrease in accounts payable and accrued liabilities, partially offset by lower property, plant and equipment as a result of movements in foreign exchange rates.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="40%"></TD>

   <TD width="20%"></TD>

   <TD width="13%"></TD>

   <TD width="2%"></TD>

   <TD width="12%"></TD>

   <TD width="7%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Backlog down 3% from last quarter</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Three months ended</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,274.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,270.0</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ orders</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>56.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>190.9</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- revenue</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(69.9</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(206.6</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>+ / - adjustments</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(28.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(21.4</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Backlog, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,232.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,232.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Adjustments this quarter were mainly due to an unfavourable foreign exchange impact, in addition to an adjustment made for a defence services program resulting from a delay in the performance of a delivery obligation by the OEM.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>This quarter's book-to-sales ratio was 0.81x. The ratio for the last 12 months was 1.09x.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7.3 New Core Markets</FONT></B></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>THIRD QUARTER OF FISCAL 2012 EXPANSIONS AND NEW INITIATIVES</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Healthcare expansions and new initiatives this quarter included the following:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>We announced that the Canadian Critical Care Society endorsed our ultrasound e-Learning curriculum and seminars;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Our Centre d&#8217;apprentissage des attitudes et habilet&#233;s cliniques (CAAHC) simulation centre received accreditation privileges by</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The Royal College of Physicians and Surgeons of Canada.</FONT></P></LI></UL>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Mining expansions and new initiatives this quarter included the following:</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=SymbolMT,Arial,Helvetica,sans-serif>- </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>We have opened an office in Vancouver, British Columbia, to focus on the western Canadian market.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>ORDERS</FONT></B><BR><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Major CAE Healthcare sales this quarter included:</FONT></P>

<UL>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to President's Hospital in Moscow, Russia, of patient simulators, centre management systems and simulator accessories;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to Americare Diagnostic Services of patient simulators and centre management systems;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to Central New Mexico College in Albuquerque, U.S., of centre management systems;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to Universiti Brunei Darussalam in Jalan Tungku Link, Brunei, of patient simulators and centre management systems;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to Mount Sinai Hospital in New York, U.S., of patient simulators;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to Tufts University in Boston, U.S., of centre management systems;</FONT></P>

<LI>

<P align=justify><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A sale to the U.S. Air Force of patient simulators and simulator accessories.</FONT></P></LI></UL>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 25</FONT></P></DIV>

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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Mining added new customers for its software solutions. Major sales this quarter included:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A sale to Silver Lake Resources in Australia of process and data management and visualisation software;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A sale to Exploraciones Mineras Parre&ntilde;a, S.A. de C.V. in Mexico of geological data management systems;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A sale to Optiro in Australia of geological modelling and mine planning systems.</FONT></P></LI>
</UL>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=35%></TD>
     <TD width=2%></TD>
     <TD width=15%></TD>
     <TD width=2%></TD>
     <TD width=8%></TD>
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     <TD width=8%></TD>
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     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Financial results</FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Q3-2012</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1-2012</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3-2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">27.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">11.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">11.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">11.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating loss</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(1.4</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.6</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2.6</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Depreciation and amortization</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment expenditures</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Intangible assets and other assets expenditures</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(2.5</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital employed</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">174.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">181.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">44.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">33.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Revenue up 33% over last quarter and up 144% over the third quarter of fiscal 2011</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase over last quarter was mainly due to higher revenue from CAE Healthcare, resulting primarily from the integration of METI, acquired in August 2011.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase over the third quarter of fiscal 2011 was mainly due to higher revenue from CAE Healthcare, resulting primarily from the integration of METI, and increased revenue from CAE Mining.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue year to date was &#36;58.8 million, 119% or &#36;31.9 million higher than the same period last year. The increase was mainly due to more revenue from CAE Healthcare, resulting primarily from the integration of METI, and more revenue from CAE Mining.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Segment operating loss down from last quarter and up over the third quarter of fiscal 2011</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating loss was &#36;1.4 million this quarter, compared to &#36;8.6 million last quarter and &#36;1.3 million in the third quarter of fiscal 2011.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The decrease in the segment operating loss from last quarter was mainly due to &#36;8.4 million of charges recognized last quarter related to the acquisition and integration of METI, partially offset by lower segment operating income from CAE Mining.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase in segment operating loss over the third quarter of fiscal 2011 was primarily due to lower segment operating income from CAE Mining, partially offset by higher segment operating income from CAE Healthcare.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Segment operating loss for the first nine months of the year was &#36;12.6 million, 180% or 8.1 million higher than the same period last year. The increase in the segment operating loss was due to the recognition this year of &#36;8.4 million of charges related to the acquisition and integration of METI.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Capital employed decreased by &#36;7.4 million over last quarter</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The decrease from last quarter was mainly due to lower intangible assets, which was mainly due to the recognition of government assistance related to technology and intellectual property rights acquired, and by the impacts of movements of foreign exchange rates.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">26 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">8. CONSOLIDATED CASH MOVEMENTS AND LIQUIDITY</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We manage liquidity and regularly monitor the factors that could affect it, including:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash generated from operations, including timing of milestone payments and management of working capital;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital expenditure requirements;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Scheduled repayments of long-term debt obligations, our credit capacity and expected future debt market conditions.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">8.1 Consolidated cash movements</FONT></B></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=33%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=4%></TD>
     <TD width=6%></TD>
     <TD width=2%></TD>
     <TD width=2%></TD>
     <TD width=7%></TD>
     <TD width=2%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=4%></TD>
     <TD width=5%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:2.339996pt">
<FONT size=1 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31 </FONT></B><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">September 30</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash provided by operating activities*</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">73.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:15.179993pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">61.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">61.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">207.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:15.179932pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">208.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Changes in non-cash working capital</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(3.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(27.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">67.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(96.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(143.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net cash provided by operating activities</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">70.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:15.179993pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">33.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">129.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">111.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:15.179932pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">64.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Maintenance capital expenditures</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">5</FONT></SUP></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(18.8</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(10.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(40.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(26.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other assets</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.0</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(7.5</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(16.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Proceeds from the disposal of property, plant</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:17.368561pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and equipment</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">28.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Dividends paid</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(8.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(10.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(25.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(27.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Free cash flow</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">5</FONT></SUP></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:15.179993pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">109.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">67.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:15.179932pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growth capital expenditures</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">5</FONT></SUP></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(25.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(14.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(35.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(80.7</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(48.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capitalized development costs</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(11.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(7.7</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(11.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(30.0</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(16.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other cash movements, net</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(7.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Business combinations, net of cash and cash</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">equivalents acquired</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">-</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.7</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(126.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(126.1</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(23.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Joint ventures, net of cash and cash equivalents</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">acquired</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.8</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(27.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Effect of foreign exchange rate changes on cash</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and cash equivalents</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(4.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net increase (decrease) in cash before proceeds</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">and repayment of long-term debt</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.179993pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(22.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(58.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(194.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.179932pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(104.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">* before changes in non-cash working capital</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Free cash flow of positive &#36;46.2 million this quarter</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The decrease over last quarter was mainly attributable to unfavourable changes in non-cash working capital and higher maintenance capital expenditures, partially offset by more cash provided by operating activities and lower other asset expeditures.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase over the third quarter of fiscal 2011 was mainly due to favourable changes in non-cash working capital, more cash provided by continuing operations and lower other asset expenditures, partially offset by higher maintenance capital expenditures.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Free cash flow year to date was &#36;67.0 million, &#36;72.9 million higher than in the same period last year. The increase was mainly attributable to favourable changes in non-cash working capital and higher proceeds from the disposal of property, plant and equipment, partially offset by higher maintenance capital expenditures.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Capital expenditures of &#36;44.1 million this quarter</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Growth capital expenditures were &#36;25.3 million this quarter and &#36;80.7 million for the first nine months of the year. We are continuing to selectively expand our training network to address additional market share and in response to training demands for our customers. Maintenance capital expenditures were &#36;18.8 million this quarter, which included the repurchase of leased simulators already included in our network, and &#36;40.6 million for the first nine months of the year.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Business combinations, net of cash and cash equivalents acquired</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">There were no cash movements resulting from business combinations this quarter, compared to &#36;126.1 million last quarter, which was mainly due to the acquisition of METI.</FONT></P>
<P style="text-align: left;">
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">5 </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-GAAP and other financial measures (see Section 5).</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 27</FONT></P>
</DIV>

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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Management&#8217;s Discussion and Analysis</FONT></P>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD vAlign=top width="2%" noWrap><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.</FONT></B>&nbsp; &nbsp; &nbsp; </TD>

   <TD width="98%">

   <P align=justify><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>CONSOLIDATED FINANCIAL POSITION</FONT></B><B><SUP><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>6</FONT></SUP></B></P></TD></TR>

<TR>

   <TD vAlign=top width="2%" noWrap><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.1</FONT></B>&nbsp; &nbsp; &nbsp; </TD>

   <TD width="98%">

   <P align=justify><B><FONT color=#777777 size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Consolidated capital employed</FONT></B></P></TD></TR>

<TR>

   <TD vAlign=top width="2%" noWrap><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT>&nbsp; &nbsp; &nbsp; </TD>

   <TD width="98%">

   <P align=justify></P></TD></TR></TABLE>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="38%"></TD>

   <TD width="9%"></TD>

   <TD width="9%"></TD>

   <TD width="2%"></TD>

   <TD width="8%"></TD>

   <TD width="11%"></TD>

   <TD width="2%"></TD>

   <TD width="6%"></TD>

   <TD width="7%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 3.899pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>As at December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>As at September 30</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>As at March 31</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Use of capital:</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Current assets</FONT></TD>

   <TD style="TEXT-INDENT: 22.559pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,090.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 21.6pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,053.7</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 3.659pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,049.2</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Less: cash and cash equivalents</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(241.7</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(227.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(276.4</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Current liabilities</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(852.7</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(827.0</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(810.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Less: current portion of long-term debt</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>147.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>125.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>86.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Non-cash working capital</FONT><SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>6</FONT></SUP></TD>

   <TD style="TEXT-INDENT: 22.559pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>144.0</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 21.6pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>125.3</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 3.659pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>48.9</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment, net</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,273.2</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,291.7</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,211.0</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other long-term assets</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>725.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>737.3</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>557.1</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other long-term liabilities</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(537.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(542.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(500.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total capital employed</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 22.559pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,605.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.6pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,612.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3.659pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,316.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Source of capital:</FONT></B></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Current portion of long-term debt</FONT></TD>

   <TD style="TEXT-INDENT: 22.559pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>147.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 21.6pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>125.7</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 3.659pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>86.2</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Long-term debt</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>688.0</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>720.2</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>574.0</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Less: cash and cash equivalents</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(241.7</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(227.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(276.4</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net debt</FONT><SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>6</FONT></SUP></TD>

   <TD style="TEXT-INDENT: 22.559pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>593.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 21.6pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>618.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 3.659pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>383.8</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Equity attributable to equity holders of the Company</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>991.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>973.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>914.4</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Non-controlling interests</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>19.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>19.4</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>18.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Source of capital</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 22.559pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,605.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.6pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,612.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3.659pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,316.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Capital employed decreased $6.5 million from last quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The decrease was mainly due to lower property, plant and equipment and other long-term assets, partially offset by an increase in non-cash working capital and a decrease in other long-term liabilities.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Our return on capital employed (ROCE)</FONT><SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>6 </FONT></SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>was 14.9% this quarter.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Non-cash working capital increased by $18.7 million from last quarter</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The increase was mainly due to lower derivative financial liabilities and higher contracts in progress assets, derivative financial assets, accounts receivable and prepayments, partially offset by higher contracts in progress liabilities.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="49%"></TD>

   <TD width="14%"></TD>

   <TD width="13%"></TD>

   <TD width="2%"></TD>

   <TD width="13%"></TD>

   <TD width="7%"></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" colSpan=2 align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Net property, plant and equipment down $18.5 million from last quarter</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" colSpan=5 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The decrease was mainly due to foreign exchange variations and depreciation, partially offset by capital expenditures.</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=6>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Change in net debt</FONT></B><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Three months ended</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31, 2011</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net debt, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>618.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>383.8</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact of cash movements on net debt</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(see table in the consolidated cash movements section)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(3.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>194.8</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(2.2</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Effect of foreign exchange rate changes on long-term debt</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(19.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>15.2</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(Decrease) increase in net debt during the period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(24.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>210.1</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net debt, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 21.9pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>593.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 18.119pt" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>593.9</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>6 </FONT></SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Non-GAAP and other financial measures (see Section 5).</FONT><BR><BR><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>28 | CAE Third Quarter Report 2012</FONT></P></DIV>

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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Effective April 1, 2011, we amended our US&#36;450.0 million revolving credit facility to extend the maturity date by two years from April 2013 to April 2015.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We also have an agreement to sell certain of our accounts receivable and contracts in progress assets (current financial assets program) for an amount up to &#36;150.0 million. As at December 31, 2011, we have applied &#36;80.7 million of accounts receivable and &#36;60.1 million of contracts in progress assets towards this program.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In August 2011, we issued senior notes for US&#36;150.0 million by way of a private placement to fund the METI acquisition and to replace other existing obligations at lower interest costs. The average maturity is 11.7 years with an average interest rate of approximately 4.5%, with interest payable semi-annually in August and February. These unsecured senior notes have fixed repayment amounts of US&#36;100.0 million in 2021 and US&#36;50.0 million in 2026. These notes were issued to two institutional investors.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In November 2011, we exercised purchase options in the amount of US&#36;13.2 million for two simulators previously accounted for as finance leases, resulting in a reduction of our obligations under finance leases.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">We believe that our cash and cash equivalents, access to credit facilities and expected free cash flow is enabling the pursued growth of our business, the payment of dividends and will enable us to meet all other expected financial requirements in the near term.</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total equity increased by &#36;18.4 million this quarter</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The increase in equity was mainly due to net income of &#36;46.1 million and a net positive change in cash flow hedge of &#36;13.9 million, partially offset by an unfavourable foreign currency translation adjustment of &#36;36.2 million and dividends of &#36;8.0 million.</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Outstanding share data</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Our articles of incorporation authorize the issue of an unlimited number of common shares and an unlimited number of preferred shares issued in series. We had a total of 257,821,966 common shares issued and outstanding as at December 31, 2011 with total share capital of &#36;449.4 million.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">As at January 31, 2011, we had a total of 257,859,064 common shares issued and outstanding.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">10. BUSINESS COMBINATIONS</FONT></B></P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Fiscal 2012 acquisitions</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">As at December 31, 2011, we entered into business combination transactions for a total cost of &#36;129.7 million.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=2 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Medical Education Technologies, Inc.</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In August 2011, we acquired 100% of the shares of Medical Education Technologies, Inc. (METI). With this acquisition, we gain global market access, expand our product and services offering and acquired simulation-based technology for healthcare.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The preliminary determination of the fair value for the above acquisition of the net identifiable assets acquired and liabilities assumed has not changed since those disclosed for the period ended September 30, 2011 and is included in the table below. The fair value of the acquired identifiable intangible assets of &#36;39.0 million (including technology and customer relationships) is still provisional for the period ended December 31, 2011 and will be until the valuation for those assets are finalized.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Preliminary goodwill of &#36;99.1 million arising from the acquisition of METI is attributable to the advantages gained, which include:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A platform that immediately propels us to an important position by providing access to the human patient simulator segment, a</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">significant segment of the overall healthcare simulation market;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">An expanded customer base for CAE Healthcare, enabling the offering of the existing portfolio of solutions to a much broader</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">market;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">An experienced management team with subject matter expertise and industry know-how.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The fair value of the acquired accounts receivable was &#36;9.7 million, net of an allowance for doubtful accounts of &#36;0.8 million.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The revenue and operating profit included in the consolidated income statement, from METI since the acquisition date, is &#36;22.2 million and &#36;1.4 million respectively. Had METI been consolidated from April 1, 2011, the consolidated income statement would have shown additional revenue and operating profit from METI of &#36;31.0 million and &#36;1.8 million respectively. These pro-forma amounts are estimated based on the operations of the acquired business prior to the business combination by CAE, but are adjusted to reflect our accounting policies where significant. The amounts are provided as supplemental information and are not necessarily indicative of our future performance.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 29</FONT></P>
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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=2 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Haptica Limited</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In July 2011, we acquired the assets and intellectual property of Haptica Limited (Haptica). The acquisition serves to add to CAE Healthcare&#146;s surgical solution offering.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The fair value of the net identifiable assets acquired and liabilities assumed is also included in the table below. The fair value of the acquired identifiable assets amount to &#36;0.7 million (including technology and intellectual property rights) and no goodwill is recognized from this acquisition.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=2 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Other</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Adjustments to the determination of the net identifiable assets acquired and liabilities assumed for certain fiscal 2011 acquisitions were also completed during the period and resulted in a net decrease to goodwill of &#36;0.3 million. Remaining additional consideration outstanding for previous years&#146; acquisitions amounts to &#36;12.3 million which is contingent on certain conditions being satisfied.</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=48%></TD>
     <TD width=5%></TD>
     <TD width=4%></TD>
     <TD width=2%></TD>
     <TD width=5%></TD>
     <TD width=6%></TD>
     <TD width=2%></TD>
     <TD width=2%></TD>
     <TD width=8%></TD>
     <TD width=5%></TD>
     <TD width=4%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left colspan=5 style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net assets acquired and liabilities assumed arising from the acquisitions were as follows:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.559998pt">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right colspan=3 style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31, 2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Current assets</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1)</FONT></SUP></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:20.399902pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">17.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Current liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(19.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Intangible assets excluding goodwill</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">39.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Goodwill</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">99.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Deferred income taxes</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(8.1</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-current liabilities</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(5.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Fair value of net assets, excluding cash position at acquisition</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:20.399902pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">126.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash and cash equivalents in subsidiary acquired</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.559998pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total purchase consideration</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:20.399902pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">129.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.559998pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Purchase price payable</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.559998pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total cash consideration</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:20.399902pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">129.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1) </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Excluding cash on hand.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2) </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">This goodwill is not deductible for tax purposes.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Changes in goodwill were as follows:</FONT><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=5>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net book value, beginning of period</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">307.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:20.400024pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">179.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">195.1</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:20.399902pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">161.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Acquisition of subsidiaries</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">99.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Exchange differences</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(6.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">6.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net book value, end of period</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">301.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:20.400024pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">175.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">301.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:20.399902pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">175.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">30 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<P style="text-align: right;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">11. CHANGE IN ACCOUNTING STANDARDS</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">There were no changes in accounting standards this period.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">12. INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) IMPLEMENTATION</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Effective April 1, 2010, we began reporting our financial results in accordance with IFRS. This MD&amp;A should be read in conjunction with our consolidated interim financial statements for the nine-month period ended December 31, 2011, which were prepared in accordance with IAS 34, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">Interim financial reporting</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, and IFRS 1, </FONT><I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">First-time adoption of IFRS</FONT></I><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">, as issued by the IASB and the MD&amp;A for fiscal 2011. The comparative figures for each period of the year ended March 31, 2011 have been restated to comply with IFRS. For details on the most significant adjustments to the consolidated financial statements, refer to Note 2 &#150; First-time adoption of IFRS of our consolidated interim financial statements.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The accounting policy differences and impacts identified should not be considered complete or final as the information presented in Note 2 &#150; First-time adoption of IFRS of our consolidated interim financial statements reflects our current assumptions, estimates and expectations, all of which are subject to change. Any subsequent changes to IFRS that are issued and effective as at December 31, 2011 could result in a restatement of our consolidated interim financial statements, including the transition adjustments recognized on conversion to IFRS. In addition, final decisions on accounting policies are not required to be made until the preparation of the fiscal 2012 annual financial statements is complete.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">13. CONTROLS AND PROCEDURES</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In the third quarter ended December 31, 2011, the Company did not make any significant changes in, nor take any significant corrective actions regarding its internal controls or other factors that could significantly affect such internal controls. The Company&#146;s CEO and CFO periodically review the Company&#146;s disclosure controls and procedures for effectiveness and conduct an evaluation each quarter. As of the end of the third quarter, the Company&#146;s CEO and CFO were satisfied with the effectiveness of the Company&#146;s disclosure controls and procedures.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 31</FONT></P>
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<TABLE border=0 cellspacing=0>
<TR>
     <TD width=43%></TD>
     <TD width=3%></TD>
     <TD width=7%></TD>
     <TD width=2%></TD>
     <TD width=8%></TD>
     <TD width=2%></TD>
     <TD width=8%></TD>
     <TD width=2%></TD>
     <TD width=8%></TD>
     <TD width=2%></TD>
     <TD width=7%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Management&#146;s Discussion and Analysis</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2 style="TEXT-INDENT:1.800003pt">
<B><FONT color="#777777" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">14. </FONT></B><B><FONT color="#808080" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">SELECTED QUARTERLY FINANCIAL INFORMATION</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Year</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.800003pt">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except per share amounts and exchange rates)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Q4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">to date</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Fiscal 2012 - IFRS</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">427.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">433.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">453.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,314.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net income</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">43.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">38.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">128.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:11.252823pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">43.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">38.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">45.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">127.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:11.253220pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic EPS attributable to equity holders of the Company</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.17</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.15</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.18</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.49</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Diluted EPS attributable to equity holders of the Company</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.17</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.15</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.18</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.49</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average number of shares outstanding (basic)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">257.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">257.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">257.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">257.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average number of shares outstanding (diluted)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">258.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">258.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">258.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">258.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, U.S. dollar to Canadian dollar</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.97</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.98</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.02</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.99</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, Euro to Canadian dollar</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.39</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.38</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.38</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.39</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, British pound to Canadian dollar</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.58</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.58</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.61</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.59</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Fiscal 2011 - IFRS</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">366.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">388.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">410.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">465.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,630.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net income</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">36.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">46.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">160.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:11.252823pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">37.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">45.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">160.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:11.253220pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.6</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic EPS attributable to equity holders of the Company</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.18</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.62</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Diluted EPS attributable to equity holders of the Company</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.14</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.18</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.62</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average number of shares outstanding (basic)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average number of shares outstanding (diluted)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">257.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">257.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">258.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">257.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, U.S. dollar to Canadian dollar</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.03</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.04</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.01</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.99</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.02</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, Euro to Canadian dollar</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.31</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.34</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.38</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.35</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.34</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, British pound to Canadian dollar</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.53</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.61</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.60</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.58</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.58</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Fiscal 2010 - Canadian GAAP</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">383.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">364.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">382.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">395.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,526.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Earnings from continuing operations</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">27.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">37.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">144.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic earnings per share from continuing operations</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.11</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.16</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.56</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Diluted earnings per share from continuing operations</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.11</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.16</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.56</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net earnings</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">27.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">37.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">144.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic earnings per share</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.11</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.16</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.56</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Diluted earnings per share</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.11</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.16</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.56</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average number of shares outstanding (basic)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average number of shares outstanding (diluted)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.4</FONT></TD>
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.6</FONT></TD>
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.9</FONT></TD>
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.4</FONT></TD>
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">255.8</FONT></TD>
	<TD align=left>
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, U.S. dollar to Canadian dollar</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.17</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.10</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.06</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.04</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.09</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, Euro to Canadian dollar</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.59</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.57</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.56</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.44</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.54</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.800003pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Average exchange rate, British pound to Canadian dollar</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.81</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.80</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.73</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.63</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.74</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1) </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Not available</FONT></P>
<P style="text-align: left;">
<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2) </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">For these periods, the effect of stock options potentially exercisable was anti-dilutive; therefore, the basic and diluted weighted average number of shares outstanding are the same.</FONT></P>
<IMG src="q3reportenx34x1.jpg" border=0>
<BR>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">32 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<TABLE border=0 cellspacing=0>
<TR>
     <TD width=42%></TD>
     <TD width=21%></TD>
     <TD width=8%></TD>
     <TD width=8%></TD>
     <TD width=2%></TD>
     <TD width=2%></TD>
     <TD width=11%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=4>
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Interim Financial Statements</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<FONT size=4 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Statement of Financial Position</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">March 31</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions of Canadian dollars)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Assets</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(Note 2)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash and cash equivalents</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">241.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">276.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Accounts receivable</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">312.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">296.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Contracts in progress : assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">251.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">230.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Inventories</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">145.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">124.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Prepayments</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">43.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes recoverable</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">80.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">58.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Derivative financial assets</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">12.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">18.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total current assets</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,090.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,049.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,273.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,211.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Intangible assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">530.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">375.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Deferred tax assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">25.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Derivative financial assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">8.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">11.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other assets</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">161.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">149.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total assets</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3,089.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2,817.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Liabilities and equity</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Accounts payable and accrued liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">529.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">551.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Provisions</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">23.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">20.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes payable</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">9.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Contracts in progress : liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">126.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">125.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Current portion of long-term debt</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">147.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">86.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Derivative financial liabilities</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total current liabilities</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">852.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">810.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Provisions</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">9.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Long-term debt</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">688.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">574.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Royalty obligations</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">158.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">161.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Employee benefits obligations</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">96.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">62.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Deferred gains and other non-current liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">180.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">187.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Deferred tax liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">80.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">64.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Derivative financial liabilities</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">12.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">13.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total liabilities</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2,078.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,884.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Equity</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Share capital</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">449.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">440.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Contributed surplus</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">19.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">17.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other reserves</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(8.9</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(9.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Retained earnings</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">532.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">466.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity attributable to equity holders of the Company</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">991.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">914.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">19.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">18.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total equity</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,011.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">932.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total liabilities and equity</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:29.099976pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3,089.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2,817.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The accompanying notes form an integral part of these Consolidated Financial Statements.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: right;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 33</FONT></P>
</DIV>

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<TR>
     <TD width=38%></TD>
     <TD width=8%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=2%></TD>
     <TD width=4%></TD>
     <TD width=7%></TD>
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     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=4%></TD>
     <TD width=5%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Interim Financial Statements</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=14>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=14>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=4 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Income Statement</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=14>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions of Canadian dollars,</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">except per share amounts)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(Note 2)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(Note 2)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">13</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">453.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">410.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,314.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,165.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cost of sales</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">300.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">274.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">884.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">771.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Gross profit</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">152.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">136.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">430.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">394.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Research and development expenses</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">47.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">31.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Selling, general and administrative expenses</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">62.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">61.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">184.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">172.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other (gains) losses - net</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(3.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(15.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(15.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Operating profit</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">77.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">70.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">213.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">204.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(1.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(5.1</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance expense</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">17.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">51.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">48.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance expense - net</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">44.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Earnings before income taxes</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">61.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">54.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">167.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">160.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income tax expense</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">15.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">39.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">45.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net income</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">128.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">114.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=14>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Attributable to:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">45.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">127.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">114.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">128.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">114.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Earnings per share from continuing operations</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">attributable to equity holders of the Company</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic and diluted</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.18</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:12.480011pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.15</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.49</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.45</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=14>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=6>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The accompanying notes form an integral part of these Consolidated Financial Statements.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">34 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<TR>
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     <TD width=3%></TD>
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     <TD width=7%></TD>
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     <TD width=9%></TD>
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     <TD width=4%></TD>
     <TD width=4%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=7>
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Interim Financial Statements</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=13>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=13>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=3>
<FONT size=4 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Statement of Comprehensive Income</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
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&nbsp;</TD>
</TR>
<TR>
	<TD colspan=13>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions of Canadian dollars)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net income</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">46.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">128.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">114.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other comprehensive income (loss)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Foreign currency translation adjustment</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net currency translation difference on the translation of financial</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">statements of foreign operations</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(39.9</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(42.7</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">18.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(16.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net change in gains (losses) on certain long-term debt denominated in foreign</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">currency and designated as hedges of net investments in foreign operations</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">4.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(7.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Reclassifications to income</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">-</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.6</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">-</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.6</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(36.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(40.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">12.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(14.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net changes in cash flow hedge</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Effective portion of changes in fair value of cash flow hedges</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">13.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">13.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(14.8</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net change in fair value of cash flow hedges transferred to</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">net income or to related non-financial assets or liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">6.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.2</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(7.5</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(5.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">13.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">8.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(11.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Defined benefit plan actuarial gains (losses) adjustment</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Defined benefit plan actuarial gains (losses)</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.5</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(42.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.5</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">11.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(30.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(6.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Other comprehensive loss</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(20.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(31.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(29.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(21.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total comprehensive income</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">25.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">98.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">93.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total comprehensive income attributable to:</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">25.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">97.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">93.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total comprehensive income</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">25.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">98.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">93.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=13>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=3>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The accompanying notes form an integral part of these Consolidated Financial Statements.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: right;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 35</FONT></P>
</DIV>

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<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=4 face=ArialMT,Arial,Helvetica,sans-serif>Consolidated Statement </FONT><FONT size=4 face=ArialMT,Arial,Helvetica,sans-serif>of </FONT><FONT size=4 face=ArialMT,Arial,Helvetica,sans-serif>Changes </FONT><FONT size=4 face=ArialMT,Arial,Helvetica,sans-serif>in Equity</FONT></P>

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   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

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   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=7 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Attributable to equity holders of the Company</FONT></TD>

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   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>nine months ended December 31, 2011</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Common shares</FONT></TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif></FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Non</FONT>-</FONT></TD>

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   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions</FONT></I></TD>

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   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Number of</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Stated</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contributed</FONT></TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other</FONT></TD>

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   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Retained</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

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   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>controlling</FONT></TD>

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   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Total</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

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   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>of Canadian dollars, except number of shares)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>shares</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>value</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>surplus</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>reserves</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>earnings</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>interests</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>equity</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

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   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Balances, beginning of period</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>256,964,756</FONT></TD>

   <TD style="TEXT-INDENT: 19.32pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>440.7</FONT></TD>

   <TD style="TEXT-INDENT: 3.119pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>17.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(9.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>466.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>914.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>18.5</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>932.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

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   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net income</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>127.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>127.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.2</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>128.3</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

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   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other comprehensive income (loss):</FONT></TD>

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   <TD align=left>&nbsp;</TD>

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   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Foreign currency translation adjustment</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>12.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>12.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>12.7</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net changes in cash flow hedge</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(11.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(11.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(11.7</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Defined benefit plan actuarial losses adjustment</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(30.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(30.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(30.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total comprehensive income</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="TEXT-INDENT: 19.32pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="TEXT-INDENT: 3.119pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.9</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>96.5</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>97.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.3</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>98.7</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Stock options exercised</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>283,975</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.0</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Optional cash purchase</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>599</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Stock dividends</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>572,636</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.9</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(5.9</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Transfer upon exercise of stock options</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Share-based payments</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.0</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Dividends</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(25.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(25.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(25.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Balances, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>257,821,966</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 19.32pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>449.4</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3.119pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>19.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(8.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>532.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>991.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>19.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,011.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=23>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=7 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Attributable to equity holders of the Company</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>nine months ended December 31, 2010</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Common shares</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Non</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Number of</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Stated</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contributed</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Retained</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>controlling</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>of Canadian dollars, except number of shares)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>shares</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>value</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>surplus</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>reserves</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>earnings</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>interests</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>equity</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Balances, beginning of period</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>256,516,994</FONT></TD>

   <TD style="TEXT-INDENT: 19.32pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>436.3</FONT></TD>

   <TD style="TEXT-INDENT: 3.119pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>14.2</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>11.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 1.5pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>338.5</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>800.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>18.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>818.4</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net income</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>114.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>114.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>114.9</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other comprehensive income (loss):</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Foreign currency translation adjustment</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(14.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(14.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(14.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net changes in cash flow hedge</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Defined benefit plan actuarial losses adjustment</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total comprehensive income (loss)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="TEXT-INDENT: 19.32pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD style="TEXT-INDENT: 3.119pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(15.5</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="TEXT-INDENT: 1.5pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>108.5</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>93.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>93.1</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Stock options exercised</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>267,225</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Stock dividends</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>38,222</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.4</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Transfer upon exercise of stock options</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.7</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.7</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Share-based payments</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.4</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Acquisition of non-controlling interests</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.2</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.2</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.2</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.4</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Dividends</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(27.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(27.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(27.8</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Balances, end of period</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>256,822,441</FONT></TD>

   <TD style="TEXT-INDENT: 19.32pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>439.2</FONT></TD>

   <TD style="TEXT-INDENT: 3.119pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>16.9</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(4.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="TEXT-INDENT: 1.5pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>418.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>870.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>17.9</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>888.5</FONT></TD>

   <TD align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The total of </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>retained earnings </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and other </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>reserves </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>for the nine </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>months </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>ended </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>31, 2011 was $523.1 million ($414.5 million as at </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>31, 2010).</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>accompanying </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>notes form an </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>integral </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>part of these </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Consolidated Financial Statements.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>36 | CAE Third </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Quarter </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Report 2012</FONT></P></DIV>

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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Interim Financial Statements</FONT></TD>
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<FONT size=4 face="ArialMT,Arial,Helvetica,sans-serif">Consolidated Statement of Cash Flows</FONT><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
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	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">nine months ended December 31</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions of Canadian dollars)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Operating activities</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net income</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">128.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">114.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Adjustments to reconcile net income to cash flows from operating activities:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Depreciation of property, plant and equipment</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">68.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">63.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Amortization of intangible and other assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">24.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Financing cost amortization</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Deferred income taxes</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">18.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">25.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Investment tax credits</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(10.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(9.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Share-based payments</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Defined benefit pension plans</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(9.0</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(8.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Amortization of other non-current liabilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(8.5</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(5.4</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Changes in non-cash working capital</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(96.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(143.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net cash provided by operating activities</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">111.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">64.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Investing activities</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Business combinations, net of cash and cash equivalents acquired</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3</FONT></TD>
	<TD align=left style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(126.1</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(23.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Joint venture, net of cash and cash equivalents acquired</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(27.6</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capital expenditures for property, plant and equipment</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(121.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(75.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Proceeds from disposal of property, plant and equipment</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">28.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Capitalized development costs</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(30.0</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(16.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">ERP and other software</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(12.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(12.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">4.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net cash used in investing activities</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(284.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(132.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Financing activities</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net borrowing under revolving unsecured credit facilities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">14.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net effect of current financial assets program</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">10.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Proceeds from long-term debt, net of transaction costs</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">182.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">35.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Repayment of long-term debt</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(26.7</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(37.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Proceeds from finance lease</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">-</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">11.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Repayment of finance lease</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(19.9</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(26.5</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Dividends paid</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(25.0</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(27.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Common stock issuance</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(9.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net cash provided by (used in) financing activities</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">136.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(53.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net decrease in cash and cash equivalents</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(36.2</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(120.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Cash and cash equivalents, beginning of period</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">276.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">312.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Effect of foreign exchange rate changes on cash</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.000000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">and cash equivalents</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.5</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Cash and cash equivalents, end of period</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">241.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">190.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Supplemental information:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Interest paid</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:23.880005pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">35.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">39.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Interest received</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">4.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income taxes paid</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">23.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The accompanying notes form an integral part of these Consolidated Financial Statements.</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: right;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 37</FONT></P>
</DIV>

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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT></P>
<P style="text-align: left;">
<FONT size=4 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements (Unaudited)</FONT></P>
<P style="text-align: left;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unless otherwise stated, all amounts are in millions of Canadian dollars)</FONT></I></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The consolidated interim financial statements were authorized for issue by the board of directors on February 8, 2012.</FONT></P>
<P style="text-align: left;">
<B><FONT color="#5f5f5f" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">NOTE 1 &#150; NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</FONT></B></P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nature of operations</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Inc. and its subsidiaries (or the Company) design, manufacture and supply simulation equipment services and develop integrated training solutions for the military, commercial airlines, business aircraft operators, aircraft manufacturers, healthcare education and service providers and the mining industry. CAE&#146;s flight simulators replicate aircraft performance in normal and abnormal operations as well as a comprehensive set of environmental conditions utilizing visual systems that contain an extensive database of airports, other landing areas, flying environments, motion and sound cues to create a fully immersive training environment. The Company offers a range of flight training devices based on the same software used on its simulators. The Company also operates a global network of training centres in locations around the world.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The Company&#146;s operations are managed through five segments:</FONT></P>
<TABLE border=0 cellspacing=0>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(i)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Civil (TS/C) &#150; Provides business, commercial and helicopter aviation training for flight, cabin, maintenance and ground personnel and associated services;</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(ii)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Civil (SP/C) &#150; Designs, manufactures and supplies civil flight simulation, training devices and visual systems;</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(iii)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Simulation Products/Military (SP/M) &#150; Designs, manufactures and supplies advanced military training equipment and software tools for air forces, armies and navies;</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(iv)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Training &amp; Services/Military (TS/M) &#150; Supplies turnkey training services, maintenance and support services, simulation-based professional services and in-service support solutions;</FONT></P>
	</TD>
</TR>
<TR>
	<TD nowrap valign=top width="2%">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(v)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="98%">
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">New Core Markets (NCM) &#150; Provides, designs and manufactures healthcare training services and devices and mining services and tools.</FONT></P>
	</TD>
</TR>
</TABLE>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE is a limited liability company incorporated and domiciled in Canada. The address of the main office is 8585 C&ocirc;te-de-Liesse, Saint-Laurent, Qu&eacute;bec, Canada, H4T 1G6. CAE shares are traded on the Toronto Stock Exchange and on the New York Stock Exchange.</FONT></P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Seasonality and cyclicality of the business</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The Company&#146;s business operating segments are affected in varying degrees by market cyclicality and/or seasonality. As such, operating performance over a given interim period should not necessarily be considered indicative of full fiscal year performance.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The Simulation Products/Civil segment sells equipment directly to airlines and to the extent that the entire commercial airline industry is affected by cycles of expansion and contraction, the Company&#146;s performance will also be affected. The Training &amp; Services/Civil segment activities are affected by the seasonality of its industry &#150; in times of peak travel (such as holidays), airline and business jet pilots are generally occupied flying aircraft rather than attending training sessions. The opposite also holds true &#150; slower travel periods tend to be more active training periods for pilots. Therefore, the Company has historically experienced greater demand for training services in the first and fourth quarters of the fiscal year and lower demand during the second and third quarters.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Order intake for the Military segments can be impacted by the unique nature of military contracts and the irregular timing in which they are awarded.</FONT></P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Basis of preparation</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The key accounting policies applied in the preparation of these consolidated interim financial statements are consistent with those disclosed in Note 1 of the Company&#146;s consolidated interim financial statements for the quarter ended June 30, 2011. These policies have been consistently applied to all years presented, unless otherwise stated.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The consolidated interim financial statements of CAE have been prepared in accordance with Part I of the Canadian Institute of Chartered Accountants (CICA) Handbook (referred to as IFRS). The accounting policies and basis of preparation differ from those set out in the Annual Report for the year ended March 31, 2011, which was prepared in accordance with Part V of the CICA Handbook (referred to as previous Canadian Generally Accepted Accounting Principles (previous Canadian GAAP)). Details of the effect of the transition from previous Canadian GAAP to IFRS on the Company&#146;s reported equity, financial performance and cash flows are provided in Note 2. Comparative figures for fiscal 2011 in these consolidated interim financial statements have been restated to give effect to these changes.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>These consolidated interim financial statements have been prepared in accordance with IFRS applicable to the preparation of interim financial statements, including IAS 34 (&#8220;Interim Financial Reporting&#8221;) and IFRS 1 (&#8220;First-time Adoption of International Financial Reporting Standards&#8221;). The accounting policies applied in these consolidated interim financial statements are the same as those applied in the Company&#8217;s interim financial statements for the period ended June 30, 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The accounting policies applied in these consolidated interim financial statements are based on IFRS issued and outstanding as of February 8, 2012, the date the Board of Directors approved the statements. Any subsequent changes to IFRS that are given effect in the Company&#8217;s annual consolidated financial statements for the year ending March 31, 2012 could result in restatement of these consolidated interim financial statements, including the transition adjustments recognized on change-over to IFRS.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>These consolidated interim financial statements should be read in conjunction with the Company&#8217;s Canadian GAAP annual consolidated financial statements for the year ended March 31, 2011 and the Company&#8217;s IFRS consolidated interim financial statements for the quarter ended June 30, 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The consolidated interim financial statements have been prepared under the historical cost convention, except for the following items measured at fair value: derivative financial instruments, financial instruments at fair value through profit and loss, certain available-for-sale financial assets and liabilities for cash-settled share-based arrangements, and as modified by the transitional arrangements permitted by IFRS 1 (see Note 2).</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The functional and presentation currency of CAE Inc. is the Canadian dollar.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 2 &#8211; FIRST-TIME ADOPTION OF IFRS</FONT></B></P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>First-time adoption</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>For all periods up to and including the year ended March 31, 2011, the Company prepared its consolidated financial statements in accordance with previous Canadian GAAP. For periods beginning on or after April 1, 2011, the Company has adopted IFRS for its consolidated financial statements. Consequently, for the interim period ending December 31, 2011, the Company has prepared its financial statements in accordance with IFRS.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>This note explains the principal adjustments made by the Company in restating previously published Canadian GAAP financial statements for the three and nine months ended December 31, 2010. For a detailed explanation of the IFRS adjustments, including adjustments to equity as at April 1, 2010, refer to the Company&#8217;s consolidated interim financial statements for the three months ended June 30, 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The accounting policy differences and impacts identified should not be considered complete or final as the information presented below reflects the Company&#8217;s current assumptions, estimates and expectations, all of which are subject to change. Any subsequent changes to IFRS that are issued and effective as at December 31, 2011 could result in a restatement of these consolidated interim financial statements, including the transition adjustments recognized on conversion to IFRS. In addition, final decisions on accounting policies are not required to be made until the preparation of the fiscal 2012 annual financial statements is complete.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Reconciliation of equity as previously reported under Canadian GAAP to IFRS</FONT></B></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="43%"></TD>

   <TD width="22%"></TD>

   <TD width="10%"></TD>

   <TD width="24%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD width="22%" align=left>&nbsp;</TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>December 31</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="43%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Shareholders' equity as previously reported under Canadian GAAP</FONT></TD>

   <TD width="22%" align=left>&nbsp;</TD>

   <TD width="10%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,233.6</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS adjustments decrease:</FONT></TD>

   <TD width="22%" align=left>&nbsp;</TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Government assistance*</FONT></TD>

   <TD width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>A</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(103.5</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment*</FONT></TD>

   <TD width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>B</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(64.1</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Employee benefits</FONT></TD>

   <TD width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>C</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(62.6</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Borrowing costs*</FONT></TD>

   <TD width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>D</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(24.6</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Leases*</FONT></TD>

   <TD width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>E</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(23.4</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue</FONT></TD>

   <TD width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>F</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(5.8</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Income taxes and other</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="22%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>G</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(79.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Equity attributable to equity holders of the Company under IFRS</FONT></TD>

   <TD width="22%" align=left>&nbsp;</TD>

   <TD width="10%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>870.6</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="43%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Non-controlling interests</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="22%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="24%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>17.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="43%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Total equity as reported under IFRS</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="22%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="24%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>888.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR>

<TR>

   <TD width="101%" colSpan=5>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="65%" colSpan=2 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>* Certain tax effects for these adjustments are included in income taxes and other.</FONT></TD>

   <TD width="10%" align=right>&nbsp;</TD>

   <TD width="24%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 39</FONT></P></DIV>

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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Reconciliation of net income as previously reported under Canadian GAAP to IFRS</FONT></B></TD>
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&nbsp;</TD>
	<TD align=right colspan=8>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">three months ended December 31, 2010</FONT></B></TD>
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&nbsp;</TD>
	<TD align=right>
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	<TD align=right colspan=9>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">nine months ended December 31, 2010</FONT></B></TD>
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<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions, except</FONT></I></TD>
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<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">per share amounts)</FONT></I></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">411.3</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.5</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">410.8</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,164.6</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.6</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,165.2</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cost of sales</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A, B, D-F</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">280.0</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.2</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
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&nbsp;</TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">274.8</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">787.2</FONT></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(16.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">771.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Gross profit</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">131.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">136.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">377.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">394.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Research and development</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">9.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">31.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">31.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Selling, general and administrative A, C, D, G</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">61.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">61.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">172.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">172.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other losses (gains) - net</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(4.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(15.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(15.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Operating profit</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">64.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">5.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">70.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">188.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">204.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance income</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.0</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.1</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(1.1</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(3.0</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(3.2</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance expense</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A, D, E</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.3</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">25.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">22.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">48.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Finance expense - net</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">8.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">15.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">22.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">21.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">44.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Earnings before income taxes</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">56.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.7</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">54.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">166.0</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(6.0</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">160.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Income tax expense</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">G</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">15.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">45.9</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">45.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net income</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">38.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">120.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">114.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Attributable to:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.7</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">38.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">120.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">114.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Earnings per share from continuing operations</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">attributable to equity holders of the Company</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Basic</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.16</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.01</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.15</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.47</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:4.800018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.02</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.45</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Diluted</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.16</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.01</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.15</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.47</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.02</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.45</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Weighted average number of</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:2.101486pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">shares outstanding (basic)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">256.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">256.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">256.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Weighted average number of</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:2.101486pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">shares outstanding (diluted)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">257.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">257.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">257.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">257.2</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=14>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Reconciliation of comprehensive income as previously reported under Canadian GAAP to IFRS</FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=22>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=7>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">three months ended December 31, 2010</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=8>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">nine months ended December 31, 2010</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canadian</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canadian</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">GAAP</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right colspan=2 style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Adjustment</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">IFRS</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">GAAP</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right colspan=2 style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Adjustment</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">IFRS</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Net income</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.7</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">38.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">120.1</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(5.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">114.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other comprehensive income (loss):</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Foreign currency translation</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">adjustment</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">B-G</FONT></TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(43.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(40.1</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(18.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(14.8</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net changes in cash flow hedge</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">9.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.5</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">8.7</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.7</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Defined benefit plan actuarial</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">losses adjustment</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">C</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(0.4</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.4</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(6.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(6.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other comprehensive income (loss)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(34.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(31.8</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(19.2</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2.6</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(21.8</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total comprehensive income (loss)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">7.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">100.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(7.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">93.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total comprehensive income (loss) attributable to:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Equity holders of the Company</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">6.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">100.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(7.9</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">93.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-controlling interests</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.2</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.1</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Total comprehensive income (loss)</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.5</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">7.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">100.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:6.300018pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(7.8</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:1.500000pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">93.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

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<P style="text-align: center;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT></P>
<P style="text-align: left;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Summary reconciliation of statement of cash flows as previously reported under Canadian GAAP to IFRS</FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=44%></TD>
     <TD width=17%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=11%></TD>
     <TD width=2%></TD>
     <TD width=5%></TD>
     <TD width=2%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=5>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">nine months ended December 31, 2010</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canadian</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">GAAP</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Adjustment</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">IFRS</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash flows provided by operating activities</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">E, H</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">56.5</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">7.7</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">64.2</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash flows (used in) provided by investing activities</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(136.3</FONT></TD>
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4.3</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(132.0</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Cash flows used in financing activities</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">E, H</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(41.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(12.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(53.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Restatement of the financial statements from Canadian GAAP to IFRS</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The following items explain the most significant and pertinent restatements to the financial statements resulting from the application of IFRS.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">A) IAS 20 and IAS 32 - Accounting for government grants and disclosure of government assistance and financial instruments: presentation</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Royalty arrangements with the government</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=25%></TD>
     <TD width=74%></TD></TR>
<TR valign="top">
	<TD width=25%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canadian GAAP accounting policy</FONT></P>
</TD>
	<TD width=74% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">With the exception of the Government of Canada&#146;s contributions for Project Falcon, other government contributions are recorded as a reduction of the related R&amp;D program costs or as a reduction in the program&#146;s capitalized expenditures.</FONT></P>
<P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A liability to repay the government contribution is recognized when conditions arise and the repayment thereof is reflected in the consolidated earnings statement when royalties become due.</FONT></P>
<P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Contributions for Project Falcon are recognized as an interest-bearing long-term obligation. The difference between the face value of the long-term obligation and the discounted value of the long-term obligation is accounted for as a government contribution and is recognized as a reduction of costs or as a reduction of capitalized expenditures.</FONT></P>
</TD>
</TR>
<TR valign="top">
	<TD width=25%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">IFRS accounting policy</FONT></P>
</TD>
	<TD width=74% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Repayable government assistance arrangements are recognized as royalty obligations. The obligation to repay royalties is recorded when the contribution is received and is estimated based on future projections. Subsequent re-measurement of these obligations is recognized in income.</FONT></P>
</TD>
</TR>
<TR valign="top">
	<TD width=25%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Impact on net income for the three month period ended December 31, 2010</FONT></P>
</TD>
	<TD width=74% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">When compared to the amount recognized under Canadian GAAP, cost of sales was reduced by &#36;2.3 million as royalty expenses from arrangements with the government on R&amp;D programs are not recognized under IFRS. Conversely, the net finance expense related to government royalty obligations increased by &#36;3.3 million.</FONT></P>
</TD>
</TR>
<TR valign="top">
	<TD width=25%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Impact on net income for the nine month period ended December 31, 2010</FONT></P>
</TD>
	<TD width=74% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">When compared to the amount recognized under Canadian GAAP, cost of sales was reduced by &#36;5.4 million as royalty expenses from arrangements with the government on R&amp;D programs are not recognized under IFRS. Conversely, the net finance expense related to government royalty obligations increased by &#36;9.8 million.</FONT></P>
</TD>
</TR>
<TR valign="top">
	<TD width=25%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Impact on statement of cash flows</FONT></P>
</TD>
	<TD width=74% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P>
</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><I><FONT size=1 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">B) IAS 16 - Property, plant and equipment (PP&amp;E)</FONT></I></B><BR>
<BR>
<U><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">IFRS 1 Exemption &#150; fair value as deem</FONT></U><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">ed cost</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=28%></TD>
     <TD width=71%></TD></TR>
<TR valign="top">
	<TD width=28%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Exemption applied</FONT></P>
</TD>
	<TD width=71% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The company elected to use fair value as deemed cost on the date of transition for specific items of property, plant and equipment.</FONT></P>
</TD>
</TR>
<TR valign="top">
	<TD width=28%><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Impact on net income for the three month period ended December 31, 2010</FONT></P>
<P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Impact on net income for the nine month period ended December 31, 2010</FONT></P>
<P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Impact on statement of cash flows</FONT></P>
</TD>
	<TD width=71% colspan=1><P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">When compared to the amount recognized under Canadian GAAP, cost of sales was reduced by &#36;1.3 million, given the lower depreciation of the specific training devices.</FONT></P>
<P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">When compared to the amount recognized under Canadian GAAP, cost of sales was reduced by &#36;3.8 million, given the lower depreciation of specific training devices.</FONT></P>
<P><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P>
</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 41</FONT></P>
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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Componentization</FONT></P></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="74%"></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The cost of an item of PP&amp;E made up of significant separable component parts is allocated to the component parts when practicable and when an estimate can be made of the lives of the separate components.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Each part of an item of PP&amp;E with a cost that is significant in relation to the total cost of the item, and which has a useful life which is different than the main asset, must be depreciated separately.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales increased by $0.1 million given the reduced depreciation periods of certain components of buildings.</FONT></P></TD></TR>

<TR>

   <TD width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales increased by $0.2 million given the reduced depreciation periods of certain components of buildings.</FONT></P></TD></TR>

<TR>

   <TD width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="74%"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>De-recognition</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>PP&amp;E are recorded at cost less accumulated depreciation, net of any impairment charges. Subsequent costs are capitalized if they constitute an asset betterment or are expensed if they constitute a repair or maintenance.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Upon replacement of a component, a loss on disposal is recognized to income when the carrying value of a replaced item is de-recognized, unless the item is transferred to inventories. If it is not practical to determine such carrying value, the cost and accumulated depreciation will be calculated by reference to the cost of the replacement part.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales decreased by $0.1 million given the de-recognition and consequential reduction in PP&amp;E upon the transition to IFRS.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales decreased by $0.3 million given the de-recognition and consequential reduction in PP&amp;E upon the transition to IFRS.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>C) IAS 19 - Employee benefits</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><U><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS 1 Exemption and accounting imp</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>act on our continuing operations - actuarial gains and losses</FONT></U></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="26%"></TD>

   <TD width="73%"></TD></TR>

<TR vAlign=top>

   <TD width="26%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="73%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The excess of the net actuarial gain (loss) over 10% of the greater of the benefit obligation and the fair value of plan assets is not immediately recognized in income, but is amortized over the remaining service period of active employees (corridor approach). Unrecognized actuarial gains and losses below the corridor are deferred.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="26%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS 1 exemption applied and IFRS accounting policy</FONT></P></TD>

   <TD width="73%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The Company elected to recognize all cumulative actuarial gains and losses of defined benefit plans deferred under previous Canadian GAAP in opening retained earnings.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Subsequently, actuarial gains and losses for the Company&#8217;s defined benefit plans will be recognized in the period in which they occur on the statement of financial position and in other comprehensive income.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="26%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="73%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, general and administrative expenses were reduced by $0.6 million, given the reduced amortization of actuarial gains and losses.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, general and administrative expenses were reduced by $1.7 million given the reduced amortization of actuarial gains and losses.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>42 | CAE Third Quarter Report 2012</FONT></P></DIV>

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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif><U>Actuarial valuations</U></FONT></P></TD>

   <TD width="42%"></TD>

   <TD width="5%"></TD>

   <TD width="8%"></TD>

   <TD width="6%"></TD>

   <TD width="7%"></TD>

   <TD width="3%"></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="71%" colSpan=6>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>It is possible to value pension assets and obligations up to three months prior to year-end.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Pension assets and obligations are required to be valued as at the statement of financial position date.</FONT></P></TD></TR>

<TR vAlign=bottom>

   <TD rowSpan=2 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>three month period ended December 31, 2010</FONT></TD>

   <TD vAlign=top rowSpan=2 colSpan=6 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>under</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>GAAP,</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>general</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>administrative expenses increased by $0.3 million.</FONT></TD></TR>

<TR vAlign=top></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>nine month period ended December 31, 2010</FONT></FONT></TD>

   <TD vAlign=top colSpan=6 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>under</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>GAAP,</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>general</FONT> <FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>administrative expenses increased by $0.9 million.</FONT></FONT></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="71%" colSpan=6>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif><U>Past service costs</U></FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="25%"></TD>

   <TD width="74%"></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Past service costs are amortized on a straight-line basis over the average remaining service period of active employees expected to receive benefits under the plan up to the full eligibility date.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Past service costs are recognized as an expense on a straight-line basis over the average period until the benefits become vested. To the extent that the benefits are already vested following the introduction of, or changes to, a defined benefit plan, past service costs are recognized immediately.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three and nine month periods ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the amount recognized under Canadian GAAP.</FONT></P></TD></TR>

<TR>

   <TD vAlign=top width="25%">&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></TD>

   <TD vAlign=top width="74%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>D) IAS 23 - Borrowing costs</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><U><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS 1 Exemption &#8211; borrowing costs</FONT></U></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="25%"></TD>

   <TD width="74%"></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Exemption applied</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The Company elected to apply the requirement of IAS 23</FONT><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>, Borrowing Costs</FONT></I><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>, whereby interest must be capitalized to qualifying assets beginning only on April 1, 2010.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales decreased by $0.2 million, due to lower amortization resulting from the elimination of unamortized capitalized interest. However, finance expense increased by $1.0 million given that interest on certain assets did not qualify for capitalization. Under Canadian GAAP, this interest was capitalized to the cost of the related asset.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales decreased by $0.9 million due to lower amortization resulting from the elimination of unamortized capitalized interest. However, finance expense increased by $3.1 million given that interest on certain assets did not qualify for capitalization. Under Canadian GAAP, this interest was capitalized to the cost of the related asset.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 43</FONT></P></DIV>

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<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>E) IAS 17 &#8211; Leases</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Classification</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Under Canadian GAAP, a lease is classified as either a capital (finance) lease or as an operating lease. Lease classification is dependent on whether substantially all of the benefits and risks of ownership of a leased asset are transferred to the lessee and the assessment is made at the inception of the lease. Quantitative thresholds are given as determining classification thresholds.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Lease classification under IFRS is also dependent on whether substantially all of the benefits and risks of ownership of a leased asset are transferred to the lessee at the inception of the lease. No quantitative thresholds are offered, and there are additional qualitative indicators provided.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales decreased by $2.5 million, mainly due to the reversal of rent expense, which was partially offset by the depreciation incurred on the assets that changed lease classification. Conversely, finance expense increased by $2.8 million mainly due to interest accretion on the long-term debt.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>When compared to the amount recognized under Canadian GAAP, cost of sales decreased by $7.8 million, mainly due to the reversal of rent expense, which was partially offset by the depreciation incurred on the assets that changed lease classification. Conversely, finance expense increased by $8.4 million mainly due to interest accretion on the long-term debt.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Under Canadian GAAP, payments for certain simulators installed in the Company&#8217;s global network of training centres and specific buildings previously classified as operating leases were classified as cash flows from operating activities. Under IFRS, given that these leases are recognized on the balance sheet as finance leases, such payments are treated as financing activities. For the nine month period ended December 31, 2010, cash flows from financing activities were adjusted by $11.6 million as the lease obligations were repaid.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>F) IAS 18 &#8211; Revenue</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Long-term service arrangements</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Generally, revenue from long-term maintenance contracts is recognized in earnings on a straight-line method over the contract period, or in situations when it is clear that costs will be incurred on other than a straight-line basis, based on historical evidence, revenue is recognized over the contract period in proportion to the costs expected to be incurred in performing services under the contract (the percentage-of-completion or POC method).</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The notion that historical evidence is needed to recognize revenue under the POC method of accounting is not necessary. As a result, for service contracts where POC accounting more appropriately estimates the outcome of the contract, revenue recognition using the straight-line method is not appropriate.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue decreased by $0.5 million, while cost of sales increased by $0.2 million.</FONT></P></TD></TR>

<TR>

   <TD vAlign=top width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P></TD>

   <TD vAlign=top width="74%">&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue increased by $0.6 million, while cost of sales increased by $0.4 million.</FONT></TD></TR>

<TR>

   <TD vAlign=top width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD vAlign=top width="74%">&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>44 | CAE Third Quarter Report 2012</FONT></P></DIV>

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<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>G) Income taxes and other</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>Unrecognized deferred tax assets</FONT></I></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Certain transitional adjustments have resulted in the computation of additional deferred tax assets but given that IFRS imposes restrictions on the full recognition of future taxes by requiring that they be recognized only to the extent that their realization is probable, certain future tax assets have not been recognized as some benefits are expected to materialize in periods subsequent to the period meeting the probability of recovery test required to support such assets.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>IFRS 3 - Business combinations</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Acquisition costs</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Acquisition-related costs are costs an acquirer incurs to effect a business combination. Under Canadian GAAP, direct costs of a business acquisition are capitalized as part of the purchase price allocation while indirect costs are expensed.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS accounting policy</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The acquirer accounts for all acquisition-related costs as expenses in the periods in which the costs are incurred and the services are received, with the exception of costs to issue debt or equity securities.</FONT></P></TD></TR>

<TR vAlign=top>

   <TD width="25%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the three month period ended December 31, 2010</FONT></P></TD>

   <TD width="74%">

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There was no significant impact when compared to Canadian GAAP given that there were no acquisition costs incurred during the quarter.</FONT></P></TD></TR>

<TR>

   <TD width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on net income for the nine month period ended December 31, 2010</FONT></P></TD>

   <TD vAlign=top width="74%">&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>As a result of expensing the acquisition costs, general and administrative expenses increased by $1.3 million</FONT></TD></TR>

<TR>

   <TD vAlign=top width="25%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impact on statement of cash flows</FONT></P></TD>

   <TD vAlign=top width="74%">

   <P></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There is no significant impact when compared to the cash flows recognized under Canadian GAAP.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=1 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>H) Reclassifications</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Below is a reclassification that has a significant impact on the statement of cash flows:</FONT></P>

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   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Canadian GAAP</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- Certain accounts receivables and contracts in progress assets are sold to third parties for cash consideration through a financial asset program.</FONT></P></TD>

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   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>IFRS</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>- Certain contracts in progress assets sold through the financial asset program are not eligible for de-recognition. As a result, the cash consideration received for these assets are classified in the current portion of long-term debt.</FONT></P>

   <P><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>For the nine month period ended December 31, 2010, there was no significant impact when compared to the cash flows recognized under Canadian GAAP from this reclassification.</FONT></P></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 3 &#8211; BUSINESS COMBINATIONS</FONT></B></P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Fiscal 2012 acquisitions</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>As at December 31, 2011, the Company entered into business combination transactions for a total cost of $129.7 million.</FONT></P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=2 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>Medical Education Technologies, Inc.</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>In August 2011, the Company acquired 100% of the shares of Medical Education Technologies, Inc. (METI). With this acquisition, the Company gains global market access, expands CAE&#8217;s product and services offering and acquired simulation-based technology for healthcare.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The preliminary determination of the fair value for the above acquisition of the net identifiable assets acquired and liabilities assumed has not changed since those disclosed for the period ended September 30, 2011 and is included in the table below. The fair value of the acquired identifiable intangible assets of $39.0 million (including technology and customer relationships) is still provisional for the period ended December 31, 2011 and will be until the valuation for those assets are finalized.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 45</FONT></P></DIV>

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<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Preliminary goodwill of &#36;99.1 million arising from the acquisition of METI is attributable to the advantages gained, which include:</FONT></P>
<UL>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">A platform that immediately propels the Company to an important position by providing access to the human patient simulator</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">segment, a significant segment of the overall healthcare simulation market;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">An expanded customer base for CAE Healthcare, enabling the offering of the existing portfolio of solutions to a much broader</FONT> <FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">market;</FONT></P></LI>
<LI>
<P align="justify"><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">An experienced management team with subject matter expertise and industry know-how.</FONT></P></LI>
</UL>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The fair value of the acquired accounts receivable was &#36;9.7 million, net of an allowance for doubtful accounts of &#36;0.8 million.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The revenue and operating profit included in the consolidated income statement, from METI since the acquisition date, is &#36;22.2 million and &#36;1.4 million respectively. Had METI been consolidated from April 1, 2011, the consolidated income statement would have shown additional revenue and operating profit from METI of &#36;31.0 million and &#36;1.8 million respectively. These pro-forma amounts are estimated based on the operations of the acquired business prior to the business combination by the Company, but are adjusted to reflect the Company&#146; accounting policies where significant. The amounts are provided as supplemental information and are not necessarily indicative of the Company&#146;s future performance.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=2 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Haptica Limited</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In July 2011, the Company acquired the assets and intellectual property of Haptica Limited (Haptica). The acquisition serves to add to CAE Healthcare&#146;s surgical solution offering.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The fair value of the net identifiable assets acquired and liabilities assumed is also included in the table below. The fair value of the acquired identifiable assets amount to &#36;0.7 million (including technology and intellectual property rights) and no goodwill is recognized from this acquisition.</FONT></P>
<P style="text-align: left;">
<B><I><FONT size=2 face="Arial-BoldItalicMT,Arial,Helvetica,sans-serif">Other</FONT></I></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Adjustments to the determination of the net identifiable assets acquired and liabilities assumed for certain fiscal 2011 acquisitions were also completed during the period and resulted in a net decrease to goodwill of &#36;0.3 million. Remaining additional consideration outstanding for previous years&#146; acquisitions amounts to &#36;12.3 million which is contingent on certain conditions being satisfied.</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net assets acquired and liabilities assumed arising from the acquisitions were as follows:</FONT></P>
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<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">nine months ended December 31, 2011</FONT></I></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Current assets</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1)</FONT></SUP></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">17.3</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Current liabilities</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(19.6</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Property, plant and equipment</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.3</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other assets</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.1</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Intangible assets excluding goodwill</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">39.7</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Goodwill</FONT><SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(2)</FONT></SUP></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">99.1</FONT></B></TD>
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<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Deferred income taxes</FONT></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(8.1</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Fair value of net assets, excluding cash position at acquisition</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">126.4</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.3</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">129.7</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.3</FONT></B></TD>
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<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Total cash consideration</FONT></B></TD>
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<SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1) </FONT></SUP><FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Excluding cash on hand.</FONT></TD>
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	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Changes in goodwill were as follows:</FONT><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=12>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=4>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net book value, beginning of period</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">307.4</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:14.699982pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">179.8</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">195.1</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">161.9</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Acquisition of subsidiaries</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(0.3</FONT></B></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">99.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.6</FONT></TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Exchange differences</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">(6.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">)</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(4.8</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">6.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">(1.5</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">)</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Net book value, end of period</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">301.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.699982pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">175.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">301.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">175.0</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">46 | CAE Third Quarter Report 2012</FONT></P>
</DIV>

<HR noshade align="center" width="100%" size=2><DIV STYLE="page-break-before: always"></div>


<!--$$/page=--><A name="page_51"></A><BR>

<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 4 &#8211; INVESTMENTS IN JOINT VENTURES</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>During the quarter, the Company entered into a new joint venture arrangement for a 50% interest in the Philippine Academy for Aviation Training, Inc.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Except for the Helicopter Training Media International GmbH joint venture, whose operations are essentially focused on designing, manufacturing and supplying advanced helicopter military training product applications, the other joint venture companies&#8217; operations are focused on providing civil and military aviation training and related services.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="45%"></TD>

   <TD width="8%"></TD>

   <TD width="11%"></TD>

   <TD width="5%"></TD>

   <TD width="2%"></TD>

   <TD width="9%"></TD>

   <TD width="5%"></TD>

   <TD width="4%"></TD>

   <TD width="2%"></TD>

   <TD width="9%"></TD></TR>

<TR vAlign=bottom>

   <TD width="85%" colSpan=7 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The following table summarizes the financial information of the Company's investment in all of its joint ventures:</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR>

   <TD width="100%" colSpan=10>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" colSpan=3 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>March 31</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="45%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2011</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Assets</FONT></B></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Current assets</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>70.4</FONT></B></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>67.6</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment and other non-current assets</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>300.7</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>258.7</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Liabilities</FONT></B></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Current liabilities</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>45.3</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>49.0</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Long-term debt (including current portion)</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>121.3</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>123.1</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Deferred gains and other non-current liabilities</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>8.0</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 2.339pt" width="45%" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="27%" colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="15%" colSpan=3 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="16%" colSpan=3 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="45%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Earnings information</FONT></B></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Revenue</FONT></TD>

   <TD width="8%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>28.6</FONT></B></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>23.0</FONT></TD>

   <TD width="5%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>81.8</FONT></B></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>66.2</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net income</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>6.7</FONT></B></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.8</FONT></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>20.2</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>14.3</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segmented operating income</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 30pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7.5</FONT></B></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.4</FONT></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>18.0</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>12.2</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=center><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.1</FONT></B></TD>

   <TD width="5%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.5</FONT></TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.3</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.6</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 30pt" width="45%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="5%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>8.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.7</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="45%" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="8%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD>

   <TD width="5%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There are no contingent liabilities relating to the Company&#8217;s interests in the joint ventures, and no contingent liabilities of the joint ventures themselves.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The Company&#8217;s share of the capital commitments of the joint ventures themselves amount to $53.0 million as at December 31, 2011 (March 31, 2011 - $37.5 million).</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 5 &#8211; ACCOUNTS RECEIVABLE</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Accounts receivable are carried on the consolidated statement of financial position net of allowance for doubtful accounts. This provision is established based on the Company&#8217;s best estimates regarding the ultimate recovery of balances for which collection is uncertain. Uncertainty of ultimate collection may become apparent from various indicators, such as a deterioration of the credit situation of a given client and delay in collection beyond the contractually agreed upon payment terms. Management regularly reviews accounts receivable, monitors past due balances and assesses the appropriateness of the allowance for doubtful accounts.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="50%"></TD>

   <TD width="26%"></TD>

   <TD width="6%"></TD>

   <TD width="2%"></TD>

   <TD width="2%"></TD>

   <TD width="8%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Details of accounts receivable were as follows:</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=7>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>March 31</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2011</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Past due trade receivables not impaired</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1-30 days</FONT></TD>

   <TD style="TEXT-INDENT: 36.66pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>27.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>33.0</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>31-60 days</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>15.7</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>22.4</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>61-90 days</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.4</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>11.7</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Greater than 90 days</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>44.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>15.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total</FONT></TD>

   <TD style="TEXT-INDENT: 36.66pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>97.0</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>82.3</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Allowance for doubtful accounts</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(7.5</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.0</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Current trade receivables</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>93.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>114.8</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Accrued receivables</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>41.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>41.3</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Receivables from related parties</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>40.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>16.6</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other receivables</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>47.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>47.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total accounts receivable</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 36.66pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>312.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>296.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=7>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 47</FONT></TD>

   <TD align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P></DIV>

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<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="44%"></TD>

   <TD width="8%"></TD>

   <TD width="4%"></TD>

   <TD width="2%"></TD>

   <TD width="4%"></TD>

   <TD width="6%"></TD>

   <TD width="2%"></TD>

   <TD width="2%"></TD>

   <TD width="8%"></TD>

   <TD width="2%"></TD>

   <TD width="4%"></TD>

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   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Changes in the allowance for doubtful accounts were as follows:</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Allowance for doubtful accounts, beginning of period</FONT></TD>

   <TD style="TEXT-INDENT: 20.699pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(8.3</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="TEXT-INDENT: 14.76pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(7.2</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(6.0</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(5.6</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Additions</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.8</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(4.3</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(2.9</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Amounts charged off</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.2</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.3</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.8</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Unused amounts reversed</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.2</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.8</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.6</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Exchange differences</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Allowance for doubtful accounts, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 20.699pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(7.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.76pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(7.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 6 &#8211; DEBT FACILITIES AND FINANCE EXPENSE, NET</FONT></B></P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Long-term debt</FONT></B></P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=2 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>Senior notes</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>In August 2011, the Company issued senior notes for US$150.0 million by way of a private placement to fund the METI acquisition and to replace other existing obligations at lower interest costs. The average maturity is 11.7 years with an average interest rate of approximately 4.5% with interest payable semi-annually in August and February. These unsecured senior notes have fixed repayment amounts of US$100.0 million in 2021 and US$50.0 million in 2026. The notes were issued to two institutional investors.</FONT></P>

<P style="TEXT-ALIGN: left"><B><I><FONT size=2 face=Arial-BoldItalicMT,Arial,Helvetica,sans-serif>Repurchase of finance leases</FONT></I></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>In November 2011, the Company exercised purchase options in the amount of US$13.2 million for two simulators previously accounted for as finance leases, resulting in a reduction in the Company&#8217;s obligations under finance leases.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="47%"></TD>

   <TD width="2%"></TD>

   <TD width="10%"></TD>

   <TD width="2%"></TD>

   <TD width="4%"></TD>

   <TD width="8%"></TD>

   <TD width="2%"></TD>

   <TD width="2%"></TD>

   <TD width="10%"></TD>

   <TD width="2%"></TD>

   <TD width="4%"></TD>

   <TD width="4%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD width="47%" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp; &nbsp;&nbsp;</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="24%" colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="20%" colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="47%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="12%" colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="20%" colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="47%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Finance expense:</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Long-term debt (other than finance leases)</FONT></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.5</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 13.979pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>8.2</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>27.7</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 13.98pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>23.6</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Finance leases</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.8</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.5</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>8.7</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.7</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Royalty obligations</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.3</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.4</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.1</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>10.0</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Amortization of deferred financing costs</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.5</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.4</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.3</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.3</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Accretion of provisions</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.4</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.3</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.5</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.0</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.2</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.5</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.9</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.0</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Post interest rate swaps interest expense</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.5</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.5</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.5</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.5</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Borrowing costs capitalized </FONT><SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1)</FONT></SUP></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.4</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="47%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Finance expense</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>17.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.979pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>16.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>51.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.98pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>48.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Finance income:</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="10%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Interest income on loans and receivables</FONT></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.3</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="TEXT-INDENT: 13.979pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.3</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="TEXT-INDENT: 13.98pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.2</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.619pt" width="47%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.3</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(3.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(3.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="47%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Finance income</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.979pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(5.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.98pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(3.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="47%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Finance expense - net</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>16.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.979pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>15.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="10%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>46.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 13.98pt" width="4%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>44.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1) </FONT></SUP><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The capitalization rate used to determine the amount of borrowing costs eligible for capitalization was 6.0% for the three months ended June 30, 2011, 5.3% for the three months ended September 30, 2011 and 4.8% for the three months ended December 31, 2011.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>48 | CAE Third Quarter Report 2012</FONT></P></DIV>

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   <TD colSpan=4 align=right><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></TD></TR>

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   <TD colSpan=5>&nbsp;</TD></TR>

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   <TD colSpan=5>&nbsp;</TD></TR>

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   <TD align=left><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 7 &#8211; EARNINGS PER SHARE AND DIVIDENDS</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

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   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

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   <TD colSpan=4 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The following is a reconciliation of the denominators for the basic and diluted earnings per share computations:</FONT><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

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   <TD colSpan=5>&nbsp;</TD></TR>

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   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp; &nbsp;&nbsp;</FONT></TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD></TR>

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   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Weighted average number of common shares outstanding</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>257,570,425</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>256,754,692</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>257,306,019</FONT></B></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>256,621,063</FONT></TD></TR>

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   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Effect of dilutive stock options</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>401,927</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>933,251</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>795,859</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>608,768</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Weighted average number of common shares outstanding</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>for diluted earnings per share</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>257,972,352</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>257,687,943</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>258,101,878</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>257,229,831</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>For the three months ended December 31, 2011, options to acquire 2,836,347 common shares (December 31, 2010 - 1,827,361) have been excluded from the above calculation since their inclusion would have an anti-dilutive effect.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>For the nine months ended December 31, 2011, options to acquire 2,683,931 common shares (December 31, 2010 - 1,856,011) have been excluded from the above calculation since their inclusion would have an anti-dilutive effect.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Dividends</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The dividends declared for the third quarter of fiscal 2012 were $10.3 million or $0.04 per share (2011 - $10.2 million or $0.04 per share). For the first nine months of fiscal 2012, dividends declared were $30.9 million or $0.12 per share (2011 - $28.2 million or $0.11 per share).</FONT><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></P>

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   <TD width="2%"></TD>

   <TD width="4%"></TD>

   <TD width="4%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

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<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 8 &#8211; EMPLOYEE COMPENSATION</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

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<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" colSpan=5 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The following table provides the total employee compensation expense recognized in income:</FONT></TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=left>&nbsp;</TD>

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   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=right><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;&nbsp;&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 4.2pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 2.1pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Salaries and benefits</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>155.5</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.699pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>143.3</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>463.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>419.5</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Share-based payments, net of equity swap</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.9</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.5</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>16.5</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Pension costs - defined benefit plans</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>8.3</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Pension costs - defined contribution plans</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.4</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total employee compensation expense</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>163.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.699pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>153.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>487.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>448.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 9 &#8211; OTHER (GAINS) LOSSES - NET</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

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   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 2.1pt" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Disposal / full retirement of property, plant and equipment</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.7</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="TEXT-INDENT: 14.699pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.2</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(8.3</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Net foreign exchange differences</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.1</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(3.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.1</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(6.6</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Gain on sale of subsidiary</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Dividend income</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.1</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(3.1</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(5.0</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Royalty income</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.4</FONT></B></TD>

   <TD align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.3</FONT></TD>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.7</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(3.7</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Other (gains) losses - net</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(3.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.699pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(4.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(15.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(15.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 49</FONT></P></DIV>

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<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="1%"></TD>

   <TD width="59%"></TD>

   <TD width="16%"></TD>

   <TD width="11%"></TD>

   <TD width="2%"></TD>

   <TD width="2%"></TD>

   <TD width="8%"></TD>

   <TD width="2%"></TD></TR>

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   <TD style="TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR>

   <TD width="101%" colSpan=8>&nbsp;</TD></TR>

<TR>

   <TD width="101%" colSpan=8>&nbsp;</TD></TR>

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   <TD style="TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 10 &#8211; SUPPLEMENTARY CASH FLOWS INFORMATION</FONT></B></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR>

   <TD width="101%" colSpan=8>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="1%" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left>&nbsp;</TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>nine months ended December 31</FONT></I></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="16%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Cash (used in) provided by non-cash working capital:</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Accounts receivable</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(10.4</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(52.5</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contracts in progress: assets</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(8.4</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(21.0</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Inventories</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(9.2</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.6</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Prepayments</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.7</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.7</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Income taxes recoverable</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(3.8</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(10.8</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Derivative financial assets</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>33.2</FONT></B></TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>33.7</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Accounts payable and accrued liabilities</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(58.7</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(36.8</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Provisions</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.7</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(7.8</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Income taxes payable</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(3.7</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>11.9</FONT></TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contracts in progress: liabilities</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.8</FONT></B></TD>

   <TD width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(40.2</FONT></TD>

   <TD width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" width="1%" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="59%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Derivative financial liabilities</FONT><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="16%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(32.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(24.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Changes in non-cash working capital</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="16%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="11%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(96.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="8%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(143.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="1%" align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="59%" align=left>&nbsp;</TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR>

<TR>

   <TD width="101%" colSpan=8>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 0pt" width="60%" colSpan=2 align=left><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE 11 &#8211; GOVERNMENT ASSISTANCE</FONT></B></TD>

   <TD width="16%" align=right>&nbsp;</TD>

   <TD width="11%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="8%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Project Falcon and Project New Core Markets</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The following table provides information regarding aggregate contributions recognized and aggregate amounts not yet received for the projects Falcon and New Core Markets:</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="41%"></TD>

   <TD width="11%"></TD>

   <TD width="4%"></TD>

   <TD width="2%"></TD>

   <TD width="4%"></TD>

   <TD width="6%"></TD>

   <TD width="2%"></TD>

   <TD width="2%"></TD>

   <TD width="7%"></TD>

   <TD width="2%"></TD>

   <TD width="4%"></TD>

   <TD width="4%"></TD>

   <TD width="2%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 2.339pt" align=left><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Outstanding contribution receivable, beginning of period</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.1</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>12.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>14.7</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contributions</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>15.3</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>11.2</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>34.2</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>30.3</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Payments received</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(15.9</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(10.7</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(37.9</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(35.4</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Outstanding contribution receivable, end of period</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Aggregate information about programs</FONT></B><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD colSpan=5 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The following table provides details on the aggregate contributions recognized for the programs:</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contributions credited to capitalized expenditures:</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Project Falcon</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.4</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.5</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.6</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Project New Core Markets</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.1</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.0</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Contributions credited to income:</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Project Falcon</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.3</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.6</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>16.1</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>18.2</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Project New Core Markets</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total contributions:</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Project Falcon</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7.1</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>10.0</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>21.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>22.8</FONT></TD>

   <TD align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 15pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Project New Core Markets</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>8.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>12.6</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>

<TR>

   <TD colSpan=13>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD colSpan=6 align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>There are no unfulfilled conditions or unfulfilled contingencies attached to these government contributions.</FONT></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>50 | CAE Third Quarter Report 2012</FONT></P></DIV>

<HR align=center SIZE=2 width="100%" noShade>



<DIV style="PAGE-BREAK-BEFORE: always"></DIV>


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<TABLE border=0 cellspacing=0>
<TR>
     <TD width=49%></TD>
     <TD width=2%></TD>
     <TD width=14%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=4%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=7>
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT></TD>
</TR>
<TR>
	<TD colspan=9>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=9>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT color="#5f5f5f" size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">NOTE 12 &#150; RELATED PARTY TRANSACTIONS</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The following transactions were carried out in the normal course of business with related parties:</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=9>
&nbsp;</TD>
</TR>
<TR>
	<TD colspan=9>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=right colspan=2>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">March 31</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Current amounts owed from</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Portion attributable to the interests of the other venturers</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:14.699982pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">40.4</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.5</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Current amounts owed to</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Portion attributable to the interests of the other venturers</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left style="TEXT-INDENT:14.699982pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">18.5</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.7</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Non-current amounts owed from</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Portion attributable to the interests of the other venturers</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.699982pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:2.100006pt">
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Sales to related parties</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Portion attributable to the interests of the other venturers</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">29.9</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">15.2</FONT></TD>
	<TD align=left style="TEXT-INDENT:14.699982pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">72.2</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">40.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.6</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.6</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">4.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">4.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Purchases from related parties</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Portion attributable to the interests of the other venturers</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">5.9</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12.7</FONT></TD>
	<TD align=left style="TEXT-INDENT:14.699982pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">11.1</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">16.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.2</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.8</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Other transactions</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Portion attributable to the interests of the other venturers</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.7</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.699982pt">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">8.4</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.700012pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The non-current amounts owed from related parties mature in October 2022 and carry an interest rate of 5.14% per annum. There are no provisions held against any of the receivables from related parties as at December 31, 2011 (March 31, 2011 - nil).</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">In addition, during the third quarter of fiscal 2012, transactions amounting to &#36;1.6 million (2011 - &#36;1.7 million) were made, at normal market prices, with organizations of which some of the Company&#146;s directors are partners or officers.</FONT></P>
<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Compensation of key management personnel</FONT></B></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Key management personnel have the ability and responsibility to make major operational, financial and strategic decisions for the Company and include certain executive officers. The compensation paid or payable to key management for employee services is shown below:</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=43%></TD>
     <TD width=14%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=6%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Salaries and other short-term employee benefits</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.0</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.699982pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1.1</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">3.5</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.6</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Post-employment benefits</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.2</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">0.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">0.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Termination benefits</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">-</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.5</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">-</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Share-based payments</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.0</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2.2</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1.5</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">6.5</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2.3</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.699982pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">3.5</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">7.3</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">10.8</FONT></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">CAE Third Quarter Report 2012 | 51</FONT></P>
</DIV>

<HR noshade align="center" width="100%" size=2><DIV STYLE="page-break-before: always"></div>


<!--$$/page=--><A name="page_56"></A><BR>

<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: left"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the </FONT><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>NOTE </FONT></B><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>13 &#8211; </FONT></B><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>OPERATING SEGMENTS </FONT></B><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>AND </FONT></B><B><FONT color=#5f5f5f size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>GEOGRAPHIC INFORMATION</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Company elected </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>to </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>organize </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>its </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>businesses </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>based </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>principally </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>on </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>products </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>services. Operating segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>are </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>reported </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>in a </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>manner consistent </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>with the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>internal reporting provided </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>to the chief </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>operating decision </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>maker. </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Company manages operations through </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>its five </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(see Note 1).</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Results </FONT></B><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>by </FONT></B><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>segment</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>The </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>profitability measure employed </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>by the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Company </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>for </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>making decisions </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>about </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>allocating resources </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>to </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>assessing segment performance </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>is </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>operating </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>profit </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(hereinafter referred </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>to as </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>segment operating income) </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>. The </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>accounting principles </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>used to </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>prepare </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>information </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>by </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>operating segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>are the same as those used to </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>prepare </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Company&#8217;s consolidated financial statements. Transactions between operating segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>are mainly </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>simulator transfers </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>from the SP/C </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>segment </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>to the TS/C </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>segment, </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>which are </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>recorded </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>at cost. The </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>method </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>used for the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>allocation </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>of assets jointly used by </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>operating segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and costs and </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>liabilities </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>jointly </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>incurred (mostly corporate </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>costs) </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>between operating segments </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>is based on the level of </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>utilization </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>when </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>determinable </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>and </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>measurable, otherwise </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>the </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>allocation </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>is based on a </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>proportion </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>of each </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>segment&#8217;s </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>cost of sales.</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="13%"></TD>

   <TD width="1%"></TD>

   <TD width="3%"></TD>

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<TR vAlign=bottom>

   <TD width="13%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I><FONT size=1 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

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<TR vAlign=bottom>

   <TD width="13%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>three months ended December 31</FONT></I></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Civil</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Military</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="13%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>External revenue</FONT></TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>123.0</FONT></B></TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>113.2</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>80.7</FONT></B></TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>66.7</FONT></TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>203.7</FONT></B></TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>179.9</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>152.4</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>153.7</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>69.9</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>66.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>222.3</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>219.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>27.1</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>11.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>453.1</FONT></B></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>410.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Depreciation and amortization</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>17.3</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>16.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.2</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.2</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>18.5</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>17.3</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.9</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.5</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.5</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.4</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.4</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.9</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.5</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.3</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>23.4</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>21.5</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Intangible and other assets</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.7</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.5</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.6</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.2</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.4</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.2</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.5</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.6</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.7</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.9</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.6</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>9.8</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Write-downs and reversals of</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>write-downs of accounts receivable</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.3</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.1</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.1</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.3</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.5</FONT></B></TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.3</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.1</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.4</FONT></B></TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.3</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.3</FONT></B></TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.6</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income (loss)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>28.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>24.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>13.2</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>42.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>32.1</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>26.9</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>28.6</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>10.9</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>36.9</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>39.5</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(1.4</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(1.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>77.5</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>70.3</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD></TR>

<TR>

   <TD width="86%" colSpan=44>&nbsp;</TD></TR>

<TR>

   <TD width="86%" colSpan=44>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>nine months ended December 31</FONT></I></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Civil</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Military</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="13%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>External revenue</FONT></TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>366.1</FONT></B></TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>333.0</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>259.4</FONT></B></TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>196.7</FONT></TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>625.5</FONT></B></TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>529.7</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>423.6</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>406.7</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>206.6</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>201.9</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>630.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>608.6</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>58.8</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>26.9</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="9%" colSpan=5 align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>&nbsp; $</FONT></B><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,314.5&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$1,165.2</FONT></FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Depreciation and amortization</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Property, plant and equipment</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>50.5</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>47.4</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.7</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.7</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>54.2</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>51.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>4.5</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>7.5</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.0</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>12.7</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>11.5</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.1</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.6</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>68.0</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>63.2</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Intangible and other assets</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>10.1</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>8.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.6</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.5</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>11.7</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>9.6</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.5</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>3.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.4</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.0</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>8.9</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3.7</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.5</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>24.3</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>16.9</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Impairment and reversal of</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>impairment of non-financial assets</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Write-downs and reversals of</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>write-downs of inventories</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>-</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Write-downs and reversals of</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD style="TEXT-INDENT: 13.5pt" width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>write-downs of accounts receivable</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.9</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.3</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.2</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.9</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.2</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(0.1</FONT></B></TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(0.1</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.1</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>-</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>0.4</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>0.1</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1.7</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.0</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="13%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Segment operating income (loss)</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>91.9</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>74.6</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>37.6</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>25.4</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>129.5</FONT></B></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>100.0</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>66.6</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>71.0</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>29.9</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>38.3</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>96.5</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>109.3</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(12.6</FONT></B></TD>

   <TD width="1%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>(4.5</FONT></TD>

   <TD width="1%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>)</FONT></TD>

   <TD width="1%" align=right>&nbsp;</TD>

   <TD width="4%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>213.4</FONT></B></TD>

   <TD width="1%" align=left>&nbsp;</TD>

   <TD width="2%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>204.8</FONT></TD>

   <TD width="1%" align=left>&nbsp;</TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>52 | CAE Third </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Quarter </FONT><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Report 2012</FONT></P></DIV>

<HR align=center SIZE=2 width="100%" noShade>



<DIV style="PAGE-BREAK-BEFORE: always"></DIV>

<!--$$/page=--><A name="page_57"></A><BR>

<DIV style="PADDING-LEFT: 0%; PADDING-RIGHT: 0%">

<P style="TEXT-ALIGN: right"><FONT color=#777777 size=1 face=ArialMT,Arial,Helvetica,sans-serif>Notes to the Consolidated Interim Financial Statements</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Capital expenditures which consist of additions to non-current assets (other than financial instruments and deferred tax assets), by segment are as follows:</FONT><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="34%"></TD>

   <TD width="23%"></TD>

   <TD width="5%"></TD>

   <TD width="2%"></TD>

   <TD width="5%"></TD>

   <TD width="6%"></TD>

   <TD width="2%"></TD>

   <TD width="9%"></TD>

   <TD width="5%"></TD>

   <TD width="4%"></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD align=left><FONT size=2 face=Calibri,Arial,Helvetica,sans-serif>&nbsp;</FONT></TD>

   <TD colSpan=4 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Three months ended</FONT></B></TD>

   <TD align=right>&nbsp;</TD>

   <TD colSpan=3 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Nine months ended</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD colSpan=2 align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2010</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C</FONT></TD>

   <TD style="TEXT-INDENT: 20.699pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>39.9</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD style="TEXT-INDENT: 14.699pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>19.9</FONT></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>106.5</FONT></B></TD>

   <TD style="TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>56.3</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>5.8</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>5.4</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>17.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>15.0</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>8.0</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>6.7</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>21.6</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>15.6</FONT></TD></TR>

<TR vAlign=bottom>

   <TD align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2.2</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1.4</FONT></TD>

   <TD align=right>&nbsp;</TD>

   <TD align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>8.3</FONT></B></TD>

   <TD align=left>&nbsp;</TD>

   <TD align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>10.7</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>(2.0</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>)</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2.8</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>4.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>7.9</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total capital expenditures</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 20.699pt" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>53.9</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.699pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>36.2</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>158.8</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 14.7pt" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>105.5</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><B><FONT size=2 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Assets and liabilities employed by segment</FONT></B></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE uses assets employed and liabilities employed to assess resources allocated to each segment. Assets employed include accounts receivable, contracts in progress, inventories, prepayments, property, plant and equipment, intangible assets, derivative financial assets and other assets. Liabilities employed include accounts payable and accrued liabilities, provisions, contracts in progress, deferred gains and other non-current liabilities and derivative financial liabilities.</FONT></P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Assets and liabilities employed by segment are reconciled to total assets and liabilities as follows:</FONT></P>

<DIV align=left>

<TABLE border=0 cellSpacing=0>



<TR>

   <TD width="64%"></TD>

   <TD width="2%"></TD>

   <TD width="18%"></TD>

   <TD width="3%"></TD>

   <TD width="3%"></TD>

   <TD width="9%"></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(Unaudited)</FONT></I></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>December 31</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="12%" colSpan=2 align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>March 31</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="64%" align=left><I><FONT size=1 face=Arial-ItalicMT,Arial,Helvetica,sans-serif>(amounts in millions)</FONT></I></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2011</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2011</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Assets employed</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=left>&nbsp;</TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C</FONT></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,300.6</FONT></B></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif></FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,225.4</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>292.4</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>251.6</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>510.0</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>506.5</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>358.8</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>352.5</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>227.4</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>68.2</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Assets not included in assets employed</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>400.7</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>413.1</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total assets</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>3,089.9</FONT></B></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif></FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>2,817.3</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>Liabilities employed</FONT></B></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=left>&nbsp;</TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=left>&nbsp;</TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/C</FONT></TD>

   <TD width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>149.8</FONT></B></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif></FONT></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>155.4</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/C</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>227.0</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>192.9</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>SP/M</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>243.3</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>308.6</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>TS/M</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>159.8</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>174.8</FONT></TD></TR>

<TR vAlign=bottom>

   <TD width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>NCM</FONT></TD>

   <TD width="2%" align=right>&nbsp;</TD>

   <TD width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>52.9</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD width="3%" align=right>&nbsp;</TD>

   <TD width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>27.8</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Liabilities not included in liabilities employed</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>1,245.5</FONT></B></TD>

   <TD width="3%" align=right></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right>&nbsp;</TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,024.9</FONT></TD></TR>

<TR vAlign=bottom>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="64%" align=left><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>Total liabilities</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="2%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>$</FONT></B></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="18%" align=right><B><FONT size=1 face=Arial-BoldMT,Arial,Helvetica,sans-serif>2,078.3</FONT></B></TD>

   <TD width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif></FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="3%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>$</FONT></TD>

   <TD style="BORDER-BOTTOM: #000000 1px solid" width="9%" align=right><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>1,884.4</FONT></TD></TR></TABLE></DIV>

<P style="MARGIN: 0px">&nbsp;</P>

<P style="TEXT-ALIGN: left"><FONT size=1 face=ArialMT,Arial,Helvetica,sans-serif>CAE Third Quarter Report 2012 | 53</FONT></P></DIV>

<HR align=center SIZE=2 width="100%" noShade>



<DIV style="PAGE-BREAK-BEFORE: always"></DIV>


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<P style="text-align: left;">
<FONT color="#777777" size=1 face="ArialMT,Arial,Helvetica,sans-serif">Notes to the Consolidated Interim Financial Statements</FONT><BR>
<BR>
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Geographic information</FONT></B><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">The Company markets its products and services globally. Sales are attributed to countries based on the location of customers. Non-current assets other than financial instruments and deferred tax assets are attributed to countries based on the location of the assets.</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=51%></TD>
     <TD width=6%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=5%></TD>
     <TD width=2%></TD>
     <TD width=10%></TD>
     <TD width=2%></TD>
     <TD width=9%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Three months ended</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right colspan=3>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">Nine months ended</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right colspan=2>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2010</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Revenue from external customers</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canada</FONT></TD>
	<TD align=left>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">51.0</FONT></B></TD>
	<TD align=left style="TEXT-INDENT:14.760010pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">59.0</FONT></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">142.6</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">148.0</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">United States</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">144.5</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">118.1</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">432.5</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">331.0</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">United Kingdom</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">31.6</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">38.0</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">112.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">126.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Germany</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">37.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">33.8</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">112.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">98.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Netherlands</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">14.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">14.2</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">42.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">44.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other European countries</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">47.0</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">42.7</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">138.3</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">115.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">China</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">27.9</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">24.1</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">83.2</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">59.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">United Arab Emirates</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">16.1</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">19.4</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">39.1</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">55.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other Asian countries</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">43.3</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">24.2</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">102.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">84.6</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Australia</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">15.8</FONT></B></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">24.8</FONT></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">51.2</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">64.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other countries</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">24.9</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">12.5</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">56.4</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">37.8</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">453.1</FONT></B></TD>
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:14.760010pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">410.8</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,314.5</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,165.2</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(Unaudited)</FONT></I><FONT size=2 face="Calibri,Arial,Helvetica,sans-serif">&#160;</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">December 31</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">March 31</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<I><FONT size=1 face="Arial-ItalicMT,Arial,Helvetica,sans-serif">(amounts in millions)</FONT></I></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">2011</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">2011</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Non-current assets other than financial instruments and deferred tax assets</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Canada</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">377.1</FONT></B></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">354.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">United States</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">600.4</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">431.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">South America</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">97.2</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">71.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">United Kingdom</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">251.2</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">248.1</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Spain</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">50.0</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">53.6</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Germany</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">61.4</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">64.3</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Belgium</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">64.6</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">60.0</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Netherlands</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">79.7</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">93.3</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other European countries</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">71.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">80.3</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">United Arab Emirates</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">81.8</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">74.9</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other Asian countries</FONT></TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">135.5</FONT></B></TD>
	<TD align=right>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">117.7</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;" style="TEXT-INDENT:15.000000pt">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">Other countries</FONT></TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">34.6</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">28.4</FONT></TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">&#36;</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="Arial-BoldMT,Arial,Helvetica,sans-serif">1,905.3</FONT></B></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">&#36;</FONT></TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">1,679.1</FONT></TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="ArialMT,Arial,Helvetica,sans-serif">54 | CAE Third Quarter Report 2012</FONT></P>
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