Trimas Corporation · NASDAQ:TRS
Trimas — Investor Day (January 2014)
32 slides from Trimas's investor day presentation, Jan 15, 2014
Slide 1: TriMas' Aerospace Business Investor & Analyst Day
TriMas’ Aerospace Business Investor & Analyst Day January 15, 2014 NASDAQ • TRS
Slide 2: Forward Looking Statements
Forward Looking Statements Any “forward-looking” statements contained herein, including those relating to market conditions or the Company’s financial condition and results, expense reductions, liquidity expectations, business goals and sales growth, involve risks and uncertainties, including, but n
Slide 3: Agenda
Agenda • Opening Remarks – Dave Wathen • Aerospace Business Presentation – David Adler and Team • Monogram Facility Tour • Question and Answer Session • Lunch and Additional Discussion 3
Slide 4: Opening Remarks
Opening Remarks Dave Wathen, TriMas President and CEO
Slide 5: Common Attributes Across Businesses
Common Attributes Across Businesses • Proprietary, highly-engineered products • Focused markets with leading market positions • Strong brand names • Well-established customer relationships • Common operating processes • Opportunities for growth and productivity • Strong cash flow generation • Manage
Slide 6: Strategic Aspirations
Strategic Aspirations Our aerospace business is a key contributor to attainment of our strategic aspirations. 6 • Generate high single-digit top-line growth • Invest in growing end markets through new products, global expansion and acquisitions • Drive 3% to 5% total gross cost productivity gains an
Slide 7: Introduction
Introduction • Proprietary, innovative products • Unique market position • Opportunities for organic growth • Plan to leverage recent bolt-on acquisitions • Increased focus on productivity and lean • Strong management team 7 Strategic growth platform for TriMas. Where innovation takes flight
Slide 8: TriMas' Aerospace Business
TriMas’ Aerospace Business David Adler, President
Slide 9: Team Introductions
Team Introductions Jan Boulden Director Human Resources Don Piening Vice President Sales & Marketing Paul Felski Vice President Manufacturing Brian MacDonald General Manager Mac Fasteners (not present) 9 David Adler Aerospace & Defense President Christian Perron Division Finance Officer Behrouz Khod
Slide 10: TriMas Aerospace Opportunities
10 TriMas Aerospace Opportunities • Unique position in fragmented market • Positive end market dynamics and trends • Significant opportunities for growth (product, customer and geography) • Available acquisitions • Productivity and lean initiatives taking hold Our mission is to develop and manufactu
Slide 11: Recent History
Recent History • 2013 backlog at 5-year high • Invested capital to grow business, increase capacity and improve service to customers • Completed two bolt-on acquisitions in 2013 • Margins recently impacted by costs related to acquisitions, new facility and manufacturing ramp-up • Launched additional
Slide 12: Aerospace Market
12 Aerospace Market Aircraft Production Value Breakdown Aerostructures ~$46B Aircraft systems, avionics & defense electronics ~$27B Aeroengines ~$32B Interiors ~$6B OEM Final Assembly ~$39B Source: ICF International We operate in an $85B market – Significant opportunity in a large growing market. 20
Slide 13: TriMas Aerospace Unique Offering
13 TriMas Aerospace Unique Offering • Highly-engineered and superior products • Long development cycles • Experienced team focused on product development and continuous improvement • Reputation for quality and best-in-class lead times • Blind bolts are preferred approach for automated aircraft assem
Slide 14: TriMas Aerospace Competes On Service
14 TriMas Aerospace Competes On Service 2010 • Monogram Composi-Lok 26 weeks • Monogram OSI Blind Bolt 28 weeks • Monogram Collars 34 weeks • Monogram Temp Fasteners 24 weeks • Martinic product average 26 weeks • Mac Fasteners product average 51 weeks 8 weeks 8 weeks 8 weeks 8 weeks 14 weeks 24 week
Slide 15: Increased Content on Composite Aircraft
15 Increased Content on Composite Aircraft Legacy Aircraft • 767 $30K • A330 $25K • A320 $20K • 737 $20K • G5 $10K Composite Aircraft Designs • 787 $230K • A350 $165K • A320NEO $35K • 737MAX $40K • G650 $45K • A380 $215K • Bell 525 $15K • KC 390 $15K Examples per management estimates TriMas’ aerospa
Slide 16: Trends – Robotic Assembly and One-sided Installation
Trends – Robotic Assembly and One-sided Installation • Industry trends toward robotic assembly and one-sided fastener installation • Customer benefits include: – Reduced airframe assembly labor costs – Improvement in assembly throughput – Elimination of assembly variability • Blind bolts are inheren
Slide 17: Trends – Robotic Assembly Partners for One-sided Installation
Trends – Robotic Assembly Partners for One-sided Installation Partnered with top integrators in promotion and supply of automated fastening systems. 17 Loxin Alema Brotje Comau Kuka Bisiach & Carrú Nikon Electroimpact
Slide 18: Preferred Supplier Partnerships with Customers
18 Preferred Supplier Partnerships with Customers Provide superior quality and consistent lead times to ensure positive customer feedback. Sales by Aircraft Type Based on 2013 management estimates Key Customers Large Commercial Business Military Regional
Slide 19: Preferred Supplier Partnerships with Customers
19 Leader in automated processes for fastener assembly and secondary operations with impressive lead times and repeatable quality. Preferred Supplier Partnerships with Customers Monogram’s internal robotic assembly process and tooling enhancements create an advantage with customers
Slide 20: Product Expansion Opportunities
20 Product Expansion Opportunities Category Estimated Market Size Approximate Market Share Market Trend Blind Bolts (Threaded & Pull Type) $200 million 32% Temporary Clamps $12 million 40% Aerospace Screws $450 million 4% Collars $180 million <2% Honeycomb Pins $5 million 75% Position in the Market
Slide 21: Product Innovation - Blind Bolt Opportunities
21 Product Innovation - Blind Bolt Opportunities Vertical Tail Plane Flap Tracks Horizontal Tail Plane Nacelles Rudders • Develop OEM customer specific applications for new products • Partner with customers and automation Typical Blind Bolt Applications Category Market Size Our Market Share Market T
Slide 22: Product Innovation - Collar Opportunities
22 Product Innovation - Collar Opportunities • The Arizona facility was recently qualified to produce Titanium swage collars used on the Boeing 787 and composite aircraft • One of only three manufacturers qualified to make this high volume fastener • Qualifications continue on 13 additional strategi
Slide 23: Product Innovation - Collar Opportunities
23 Product Innovation - Collar Opportunities • Collar facility has state of the art technology and process innovation • Location and vicinity provide excellent resources, support and economic benefits • Low overhead structure, technological advances, product quality and an extremely responsive lead-
Slide 24: Recent Acquisitions – 2013
Recent Acquisitions – 2013 24 Focus for 2014 is to reduce lead times and increase customer satisfaction. • Located in Stanton, California • Manufacturer of highly-engineered, precision machined, complex parts for commercial and military aerospace applications • Well-positioned to grow as large OEMs
Slide 25: Martinic Engineering Product Growth Opportunities
25 Martinic Engineering Product Growth Opportunities • The highest product growth rates are Airbus APU and fuel control components for A320/A321 series model Martinic Engineering is positioned for product growth. • Also significant opportunities for growth in 787 housings for air conditioning system
Slide 26: Recent Acquisitions - 2013
Recent Acquisitions - 2013 • Located in Ottawa, Kansas • Manufacturer of aerospace fasteners, globally utilized by OEMs, aftermarket repair companies, and commercial and military aircraft producers • Broadens product offering on aircraft • Diversifies distribution channels • Provides flexible manufa
Slide 27: Mac Fasteners Product Growth Opportunities
Mac Fasteners Product Growth Opportunities Joint aerospace marketing team will drive cross-selling of products. 27 • When purchased in November 2013, lead times were 51 weeks and on time delivery was less than 40% with significant past dues • Many potential customers would not do business with Mac F
Slide 28: Geographic Expansion Opportunities
28 Geographic Expansion Opportunities • Europe and North America (which used to account for 72% of all air travel) will only represent 40% in 2031 as emerging economies drive future air traffic growth • New collar approvals are well positioned: • For Boeing 787 aircraft which will be the predominate
Slide 29: Productivity and Margin Expansion Opportunities
29 Productivity and Margin Expansion Opportunities • New collar families have higher margins due to product complexities • Intense focus on reducing cost of poor quality • Improvement in first pass yield • Increase margins of acquisitions by manufacturing higher margin products for Mac Fasteners, su
Slide 30: Key Messages
Key Messages 30 Our mission is to develop and manufacture complex, highly profitable aerospace components with world-class service. • Unique offering • Increased content on composite aircraft • Best-in-class service • Trends toward robotic assembly and one- sided installation • Preferred supplier re
Slide 31: Facility Tour
Facility Tour 31 • 115,000 square foot utilization with current expansion • Approximately 360 employees at Monogram facility
Slide 32: Q & A
Q & A