Slide 1: Forward-Looking Statements
Forward-Looking Statements 2 This presentation includes certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on beliefs of Company management, as
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes certain statements relating to future results, which are forward- looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on beliefs of Company management, as
Slide 3: Established Player Serving the Global Aviation Services Market
Established Player Serving the Global Aviation Services Market 4 Leading provider of Aviation Services and Expeditionary Services to commercial and defense/govt. markets NYSE: AIR Diversified $1.7B revenue stream Over 60 years as a market leader in aftermarket aviation support Over 4,500 employees i
Slide 4: Company Overview
Company Overview 5 Supply Chain Aviation Services ~$1.4B Airlift Mobility Expeditionary Services ~$0.3B Fixed- and rotary-wing expeditionary airlift services -Passenger -Cargo -Combi Mission support, logistics resupply and training MRO Aircraft maintenance and modifications Component repair Landing
Slide 5: Aviation Services: Supply Chain
Aviation Services Supply Chain 6 Buying, selling, exchanging, and leasing overhauled airframe and engine parts > 1 million parts stocked Aircraft and engine end-of-life solutions Inventory consignments Technical services including inspections and work scoping for repairs Parts Trading Supplier of fa
Slide 6: Aviation Services: MRO
Aviation Services MRO 7 Oklahoma City Regional & Narrow body 300,000 sf in six hangars Full airframe paint capabilities Miami Narrow & Wide body 226,000 sf in three hangars Full airframe paint capabilities Indianapolis Narrow & Wide body 1.1 Million sf in 10 hangars Full airframe paint capabilities
Slide 7: Expeditionary Services
Expeditionary Services 8 Airlift Mobility Rotary & fixed wing flight operations Austere environments Search & rescue Personnel, cargo, combi, and external cargo capable Day, night, & all-weather operations Shelter systems – transportable by air, land and sea and patented for rapid on- and off-loadin
Slide 8: Serving Niche and Growing Aviation Markets
Serving Niche and Growing Aviation Markets 9 Global MRO Market ~$64 ~$96 $B Parts Distribution & Surplus Parts Market ~$13 ~$20 $B ~82% ~81% * B & GA = Business and General Aviation Source: ICF International ~21% ~21% Denotes AAR market presence ~22% ~22% Continued MRO outsourcing OEM push into cert
Slide 9: Strong Industry Relationships
Strong Industry Relationships 10 U.S. DoD U.K. MoD Colombian Air Force U.S. Marshals Service Airlines OEMs Cargo & Leasing Government
Slide 10: Strong Industry Relationships
Strong Industry Relationships Airlines Ge Acromexico. CANADA @ BRITISH AIRWAYS > (CATHAY PACIFIC China ainvines 9 Gigs ADelta MSY EXPRESS/ET renga irways © Lufthansa sincapore airuines {), A “inna” UNITED®Y SQAAR™ | Celebrating 6 years OEMs @ AIRBUS Gulfstreany Honeywell LIEBHERR LOCKHEED MARTIN NOR
Slide 11: Navigated Through Five Major Industry Cycles
Navigated Through Five Major Industry Cycles 12 Arab Oil Embargo Fuel Crisis Conflicts in Iran Economic Downturn Gulf War September 11 Attacks “Great Recession” 11% CAGR Sales ($B) After Each Down Cycle, AAR Has Emerged as a Stronger Company Sale of Telair Cargo Group - 0.5 1.0 1.5 2.0 2.5 1970 1971
Slide 12: 3Q FY2016 Highlights
3Q FY2016 Highlights Sales of $402.8 million, up 6.0% from prior year $30.8 million growth (+9.7%) in Aviation Services $8.1 million decline (-13.1%) in Expeditionary Services Diluted EPS of $0.31 per share from continuing operations, inclusive of a $0.05 per diluted share income tax benefit Gross p
Slide 13: 3Q FY2016 Income Statement Highlights
3Q FY2016 Income Statement Highlights Significant Top-Line Growth over Prior Year 14 Prior Year Prior Quarter in millions except EPS 3Q 16 3Q 15 2Q 16 PY PQ Sales $402.8 $380.1 $423.8 $22.7 ($21.0) Gross Profit $58.3 $50.1 $59.9 $8.2 ($1.6) % Margin 14.5% 13.2% 14.1% 1.3% 0.3% SG&A $42.6 $41.7 $42.5
Slide 14: 3Q FY2016 Leverage & Liquidity Levels
3Q FY2016 Leverage & Liquidity Levels Strong Delevering Trend $ in million ($ in million) Q1’14 Q2’14 Q3’14 Q4’14 Q1’15 Q2’15 Q3’15 Q4’15 Q1’16 Q2’16 Q3’16 Total Debt 702.2 680.8 714.4 634.0 627.1 635.3 643.3 154.0 179.5 170.3 195.7 Cash 90.9 98.5 114.7 89.2 81.8 92.6 67.0 54.7 28.7 62.8 50.4 Availa
Slide 15: 3Q FY2016 Debt Composition Maturity Tower
3Q FY2016 Debt Composition Maturity Tower $ in million ($ in million) 2016 2017 2018 2019 2020 2021 2022 Revolver 135 as of 2/29/16 DBJ 10.0 Convert 2.25% 25.7 * IRB 25.0 * $25.7 million remaining balance of converts was retired on March 1, 2016, with available cash and liquidity Modest Debt Retirem
Slide 16: Key Investment Highlights
Key Investment Highlights 17 Commitment to Strong Shareholder Returns Sharper focus on services businesses following recent transformation Long-term aftermarket growth Strong and deep relationships with key industry players Time-proven, value-added service provider Strong balance sheet with substant
Slide 17: Key Investment Highlights
Key Investment Highlights @ Sharper focus on services businesses following recent transformation @ Long-term aftermarket growth @ Strong and deep relationships with key industry players © Time-proven, value-added service provider @ Strong balance sheet with substantial available liquidity Commitment
Slide 18: AAR’ | Celebrating
AAR’ | Celebrating