LMI Aerospace doesn't have to "just wing it." The company makes key airplane structures such as cockpit window frames, fuselage skins, and interior components. Its aerostructures segment fabricates, machines, finishes, and integrates more than 30,000 aluminum and specialty alloy components for commercial, corporate, and military aircraft. The engineering services unit (D3 Technologies) provides design, engineering, and program management services for aircraft. The Intec division designs and tests composites for production parts. The company also makes components for laser equipment used by semiconductor makers and reusable containers with industrial and military applications.
The aerostructures segment, 66% of sales, serves aircraft OEMs and aerospace suppliers, including Gulfstream Aerospace, Boeing, and Sikorsky Aircraft, through long-term contracts as single-source providers of many of its products. The engineering services unit, D3 Technologies, supports an aircraft throughout its entire lifecycle, from conceptual design to service life extension. Specific services include system design, stress element analysis, tool design, and avionics software development for such aircraft technologies as airframes and electro/mechanical and hydraulic/pneumatic systems. Customers of the engineering services segment include Boeing (once again), Bombardier, and Mitsubishi Aircraft.
The aerostructures and engineering services segments work together to provide coordinated service for the company's clients. Most of aerostructures' revenue is recorded when a delivery is made or services given. Engineering services takes in most of its revenue through cost-plus reimbursement contracts. LMI as a whole is dependent on three major customers for much of its sales: Boeing (18%), Gulfstream (16%), and Spirit AeroSystems (about 14%).
Net sales rose about 13% in 2011 compared with 2010 thanks in part to strong sales related to the Boeing 767 and 777, the Gulfstream G650, G550, and G450, and the Mitsubishi Regional Jet program in the civilian sector and the Blackhawk program for the military.
By segment net sales for aerostructures were lifted about 13% in 2011 vs. 2010 thanks in part (as noted above) to the strong sales to Boeing, Gulfstream, Mitsubishi, and the military. Engineering services' net sales headed up 17% in 2011 compared with 2010 as a result mainly of the nacelle systems development and the Boeing Integrated Test programs. The segment also benefitted from strong sales related to the Bombardier Lear Jet L-85. The segment was also busy with Boeing 787 shipping fixtures and Boeing tooling projects. The military sector contributed with demand for the Boeing Tanker program. The company's net income has been rising steadily over the past three years, from $10.1 million in 2009 to $12.9 million in 2010 and then to about $16.4 million in 2011.
LMI's strategy is focused on its operations in high speed, hard metal machining, design-build, and composites to meet the needs of the growing number of aircraft OEMs and suppliers who rely on outsourcing. The company also cushions itself against such vicissitudes as military budget cuts or airline industry doldrums by balancing its customer mix, ensuring that the large commercial, corporate, regional, and military aircraft sectors each serve at least three large customers. Globally the company seeks low cost sourcing as a balance to its US engineering and build operations.
CEO Ronald Saks owns more than 15% of the company.
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