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BBA Aviation ‐ enabling flight; expanding horizonsMarch 2017
BBA Aviation
2016 – a transformational year
Major expansion of Signature
‒ Acquired Landmark
‒ Unique global network of >200 FBOs
Focused the Group
‒ Value added, IP protected, strong ROIC / cash flow
‒ Merged aircraft management and charter business
‒ Grown Ontic
‒ ASIG disposal
Successfully integrated Landmark Aviation
‒ Cost synergies quicker and greater than anticipated
‒ Extended opportunity for outperformance
…enhanced underlying quality, growth and opportunity for value creation
106
112
115
118
125 138
203
2010 2011 2012 2013 2014 2015 Now
Signature global network expansion
Historical1 Today2
Total operating profit
$181.5m
Total operating profit
$302.6m
01Note 1: Based on 2015 financial informationNote 2: Based on 2016 financial information
Enabling flight; expanding horizons
Aftermarket Services28%
Flight Support72%
Aftermarket Services12%
Flight Support88%
BBA Aviation
Military 5% B&GA
88%
Attractive financial characteristics‒ Low asset intensity and flexible cost base‒ Strong, resilient through‐cycle cash flow
Enhanced growth prospects‒ Increased exposure to growing B&GA market‒ Extended opportunity for outperformance
BBA Aviation today - a focused B&GA service provider
…with accelerated value creation potential
Enabling flight; expanding horizons
Aftermarket Services33%
High quality businesses‒ Market leadership‒ Unmatched customer relevance‒ Strengthened barriers to entry
Flight Support67%
RoW14%
North America86%
Commercial7%
2016 Revenue Splits
02
BBA Aviation
Market leadership
…driving sustainable value through a common vision, mission and values
Enabling flight; expanding horizons
03
68 %
38 % 19 %
9 %
6 %
5 %
5 %
1 %
Signature Flight Support
Atlantic Jet Aviation
Million Air TAC Air Ross Sheltair Cutter
Signature's enhanced leadership position
Network Enlarged Signature
Atlantic Aviation
MillionAir
JetAviation
Total locations 203 65 29 23North America 139 65 27 9Sole source locations 63 24 14 1Top 50 US airports 39‡ 29 6 7
Locations comprise licenses, JVs and fully owned entities and correct as at time of announcement‡ Adjusted for overlap locations within the top 50 of the respective category shown
(i.e. where two FBOs on one airport, we count as one location)
SignatureFlight Support
>85%Group EBIT
The world’s largest fixed base operation (FBO) and line maintenance network for Business & General Aviation (B&GA) users
Engine Repair& Overhaul
<2%Group EBIT
A leading independent authorised engine service provider,with market‐leading positions in smallthrust capacity engine and rotorcraft overhaul programmes
Ontic
>13%Group EBIT
Leading provider of high‐quality equipment and cost‐effective solutions for maturing and legacy aerospace platforms with a unique portfolio of IP‐protected components and systems
Addressable market as measured by fuel burn, source: ARG/US Top 200 locations according to FAA departures
Network relevance: addressable market at top 200 U.S. airports
BBA Aviation
Unmatched customer relevance
Unique network‒ 39 Signature locations in top 50 US airports‒ At 14 of top 20 home bases for business aircraft in USA‒ Signature presence on 49 of top 50 routes‒ Key European and ROW B&GA destinations‒ Global support for customers’ aftermarket needs
Market leading customer proposition‒ Industry leading service and safety standards‒ Full service support for B&GA – FBOs, MRO, charter, aircraft management, hangarage
‒ Network pricing optimises customer cost of flying and secures customer loyalty
‒ Strong, extensive customer relationships and knowledge
Technical capability‒ IP‐protected product knowledge‒ Efficient and flexible aftermarket processes in state‐of‐the‐art facilities
…Signature US touches 63% of business jet and turboprop fleet each year
Enabling flight; expanding horizons
04
Signature locations serve both ends of 34 of the50 most heavily‐trafficked city pairs in the USA
KLAS
KOAK
KSNA
KSDL
KSFO
KDAL
KHOU
KFTW
KSAT
KSJC
KAUS
KSAV
KPDK
KPBIKOPF
KMIA
KVNYKLAX
KTEBKMMU
KBOSKBED
KHPN
KMDWKCMH
KPWK
KIAD
Type
CompetedSole Source
Source: FAA ARG/US April 2016
BBA Aviation
Barriers to entry
Scale‒ Over 220 locations on 5 continents
‒ 9.2m sq ft of hangar, terminal and office space in the USA
‒ Handle >1.4m aircraft movements p.a.
‒ >2,200 turbine engines processed annually
‒ >150 licences for >6,000 parts
Unique network locations on long leases
One of the world’s largest aircraft management and charter businesses
Licence, adoption process and authorisation IP
Highly recognised and valued brands
Cross‐business opportunities
…underpinned by unique real estate and licence portfolio
Enabling flight; expanding horizons
05
17 17 18 18 18 19
2012 2013 2014 2015 2016 2017
US FBO Long LeasesAverage remaining lease term
Trusted brands
BBA Aviation
Increased exposure to B&GA market
Indicator DetailsShortTerm
Aircraft utilisation
‒ B&GA flying hours continued growth
Corporate confidence
‒ B&GA flying closely correlated to corporate confidence
‒ SME confidence measures continue to improve
MediumTerm
Fleet growth
‒ Global B&GA fleet continues to expand‒ Forecast fleet growth of 3‐4% CAGR through 2025‒ % of second hand fleet for sale and pricing stable
Fleet dynamics
‒ Larger aircraft are an increasing proportion of the fleet, up from 22% to 28% (2005‐2016)
‒ Higher average age of fleet
LongTerm
GDP ‒ Through‐cycle growth in excess of GDP‒ External forecasts of 2.5% flight hours growth p.a.
…continued outperformance
Enabling flight; expanding horizons
06
Source: GAMA and US Bureau of Economic AnalysisNote: 2004 the GAMA survey coverage expanded for turbine airplanes and rotorcraft, accounting for part
of the increase in hours flown
0
1000
2000
3000
4000
5000
10000
15000
20000
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
Busine
ss Je
t Flight Hou
rs (0
00s)
US GDP ($bn
)
Business Jet Flight Hours (Thousands) GDP (Billions in 2009 Dollars)
US B&GA Flight Hours and GDP
‐25.0%‐20.0%‐15.0%‐10.0%‐5.0%0.0%5.0%
10.0%15.0%
Jan‐08
Jun‐08
Nov
‐08
Apr‐09
Sep‐09
Feb‐10
Jul‐1
0
Dec‐10
May‐11
Oct‐11
Mar‐12
Aug‐12
Jan‐13
Jun‐13
Nov
‐13
Apr‐14
Sep‐14
Feb‐15
Jul‐1
5
Dec‐15
May‐16
Oct‐16
US B&GA Aircraft Movements and US Small Business Confidence
YOY 12 month rolling change in B&GA aircraft movements% YOY change in Small Business Confidence
Source: FAA and Bloomberg
BBA Aviation
With longer-term structural growth drivers
… B&GA a key efficiency and productivity tool
Enabling flight; expanding horizons
07
Business aviation: principally a North American market, created by: ‒ Large distances
‒ Dispersed population centres
‒ Lack of intermodal alternatives
‒ Retrenchment from point‐to‐point routes by commercial airlines
An established market‒ c4500 airports and 2700 FBOs (of which 2100 can sell fuel)
RoW market characteristics are different‒ Europe: compact centres; fast intermodal alternatives
‒ South America & Asia Pacific : longer‐term opportunities; markets relatively immature
A worked example Business CommercialCheck‐in Pittsburgh 0800hrs 0800hrsDepart Pittsburgh 0815hrs 0930hrsConnect in Atlanta 1115hrsDepart Atlanta 1200hrsArrive Milwaukee 1000hrs 1430hrsTotal time 2 hours 6.5 hours
Large US distances vs compact European centres
KVNY
KTEB
2,450 miles
KMIA
1,098 miles
KHOU
KSFO
1, 635 miles
KPWK723 miles
MUC
LHR
645 milesLBG
218 miles
BBA Aviation
Extended opportunity for outperformance
Proven track record of outperforming market‒ Historic market outperformance of 200bps at 25% drop through
Bigger and better network positioned to capture volume and EBITDA growth
Application of operational excellence
Broader range of value‐added services
Cost and scale synergies
Growing portfolio of IP protected licences and authorisations
Unique and broad technical skill set and knowledge
…underpinned by experience, expertise, data and track record
Enabling flight; expanding horizons
08
BBA Aviation
Attractive financial characteristics
Low asset intensity and flexible cost base‒ Fixed costs c25% / Variable costs c75%
‒ Fuel costs passed through
‒ Flexible labour
‒ Lease costs <10% Signature cost base
Strong cash generation‒ 75‐105% cash conversion normal range
Positive margin drop throughCapital structure reflecting proven through‐cycle resilience
Opportunity for enhanced capital returns‒ Progressive dividend policy
Through‐cycle ROIC target >12%
…years of disciplined investment; focusing on yield optimisation
Enabling flight; expanding horizons
09
25%
75%
Flexible Cost Base
Fixed costs‐ Leases & other
Variable costs‐ Fuel & labour
0%50%100%150%200%
0
100
200
300
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
A cash generative business model
Free Cash Flow ($m, Historical Rates) Cash Conversion (%)
BBA Aviation
Appendix
Enabling flight; expanding horizons
10
BBA Aviation
BBA Aviation – a shared vision
We drive sustainable value through a common vision, mission and valuesWe instate actions throughout organisation to deliver against specific short and long terms goals‒ Market leadership and outperformance
‒ Service quality, customer satisfaction and innovation
‒ Realising cross business opportunities
‒ Employee development, health andsafety and sustainability performance
Focus on improved capital efficiency and cash generationInvestment discipline tied to generating risk adjusted returns exceeding cost of capital
Enabling flight; expanding horizons
11
Executive ManagementExecutive Directors
Executive Management Committee
Simon PryceGroup CEO
Mike PowellGroup FD(until June 2017)
David BlizzardCompany Secretary
Kevin EricksonGroup HR Director
Gareth HallPresident and MD, Ontic
Mark JohnstonePresident and MD,Global Engine Services
Erik KellerChief Information Officer
Tony LefebvrePresident and MD,MRO and AMC
Maria SastrePresident and COO,Signature Flight Support
David CrookGroup FD(from June 2017)
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