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: Key Investment Highlights
Key Investment Highlights 3 Commitment to Strong Shareholder Returns Leadership positions in value-added services markets Significant recent organic growth in Aviation Services segment (~85% of sales) Market headwinds in Expeditionary Services segment (~15% of sales) Long-term favorable aftermarket
Slide 3: Key Investment Highlights
Key Investment Highlights ° ° ° Leadership positions in value-added services markets — Significant recent organic growth in Aviation Services segment (~85% of sales) — Market headwinds in Expeditionary Services segment (~15% of sales) Long-term favorable aftermarket growth trends Diversified, global
Slide 4: Established Player Serving the Global Aviation Services Market
Established Player Serving the Global Aviation Services Market 5 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 5,200 employees i
Slide 5: Company Overview
Company Overview 6 Supply Chain ~67% of segment Aviation Services (~85% of sales) Airlift Mobility Expeditionary Services (~15% of sales) Fixed- and rotary-wing expeditionary airlift services -Passenger -Cargo -Combi Mission support, logistics resupply and training MRO ~33% of segment Aircraft maint
Slide 6: Aviation Services Supply Chain
Aviation Services Supply Chain 7 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 7: Aviation Services MRO
Aviation Services MRO 8 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 8: Expeditionary Services Airlift Mobility
Expeditionary Services 9 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 9: INL/A Update
INL/A Update On September 1, 2016 AAR’s Airlift Group was awarded the Global Aviation Support Services contract for the Department of State Air Wing (INL/A) Airlift Group will be responsible for operating, maintaining, and provisioning a current fleet of 140 airplanes and helicopters operating aroun
Slide 10: Strong Industry Relationships
Strong Industry Relationships 11 U.S. DoD U.K. MoD Colombian Air Force U.S. Marshals Service Airlines OEMs Cargo & Leasing Government
Slide 11: Strong Industry Relationships
Strong Industry Relationships Airlines Fe Acromexico. AIR CANADA @ AIR FRANCE as) a Mula tlng BRITISH AIRWAYS i>] (CATHAY PACIFIC CHINA AIRLINES 9) ADelta SVEXPRESS/ET UR saga © Lufthansa SINGAPORE AIRLINES §), OEMs Cargo & Leasing @ AIRBUS a Pe ve 2 s volun Ciel AEC E-TN Gulfstreany Government Hone
Slide 12: Navigated Through Five Major Industry Cycles
Navigated Through Five Major Industry Cycles 13 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
Slide 13: FY2016 Highlights
FY2016 Highlights 14 Strength in Earnings and Balance Sheet Position Sales of $1.7 billion, up 4.3% from prior year $108.9 million organic growth (8.3%) in Aviation Services $40.6 million decline (14.6%) in Expeditionary Services due to market headwinds Diluted EPS of $1.16 per share from continuing
Slide 14: FY2016 Income Statement Highlights
FY2016 Income Statement Highlights Growth and Margin Improvement vs. FY15 15 Prior Year in millions except EPS FY 2016 FY 2015 Sales $1,662.6 $1,594.3 $68.3 Gross Profit $236.9 $159.3 $77.6 % Margin 14.2% 10.0% 4.3% SG&A $170.8 $171.4 $0.6 % Margin 10.3% 10.8% 0.5% Operating Income $65.8 ($11.9) $77
Slide 15: FY2016 Segment Financial Summary
FY2016 Segment Financial Summary 16 Aviation Services (~85% of sales) Expeditionary Services (~15% of sales) 7.6% Annual Growth 29.4% Annual Decline ($000) 2014 2015 2016 Gross Profit 173 144 230 Total Assets 931 919 945 D&A 26 29 26 Sales ($000) 2014 2015 2016 116 16 7 424 388 367 37 25 24 Strong G
Slide 16: 4Q FY2016 Leverage & Liquidity Levels
4Q FY2016 Leverage & Liquidity Levels 17 $ in million ($ in million) Q2’14 Q3’14 Q4’14 Q1’15 Q2’15 Q3’15 Q4’15 Q1’16 Q2’16 Q3’16 Q4’16 Total Debt 680.8 714.4 634.0 627.1 635.3 643.3 154.0 179.5 170.3 195.7 150.1 Cash 98.5 114.7 89.2 81.8 92.6 67.0 54.7 28.7 62.8 50.4 31.2 Available Cash 463.9 439.9
Slide 17: Fiscal Year 2017 Guidance
Fiscal Year 2017 Guidance 18 Consolidated sales of $1.7 billion to $1.8 billion Diluted earnings per share from continuing operations of $1.30 to $1.40 Midpoint represents 16.4% growth from FY16 diluted EPS from continuing operations of $1.16
Slide 18: Key Investment Highlights
Key Investment Highlights 19 Commitment to Strong Shareholder Returns Leadership positions in value-added services markets Significant recent organic growth in Aviation Services segment (~85% of sales) Market headwinds in Expeditionary Services segment (~15% of sales) Long-term favorable aftermarket
Slide 19: Key Investment Highlights
Key Investment Highlights ° ° ° Leadership positions in value-added services markets — Significant recent organic growth in Aviation Services segment (~85% of sales) — Market headwinds in Expeditionary Services segment (~15% of sales) Long-term favorable aftermarket growth trends Diversified, global
Slide 20: Mission