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About Advanced Input Devices, Inc.

TransDigm Group supplies a variety of behind-the-scenes componentry for aircraft manufacturing, including audio systems, pumps and valves, and power conditioning devices. Operating through a plethora of subsidiaries, TransDigm makes and distributes systems and components for commercial and military aircraft. Its products are found in several Boeing and Airbus airplanes and a number of military planes and helicopters. TransDigm acquired Esterline for about $4 billion in 2019, later that year it planned to divest the Esterline to KPS Capital. The majority of the company's products are sold to customers in the US.

Operations

TransDigm operates in three segments: Power and Control (contributing more than half of revenue), Airframe (about 45%), and Non-aviation (less than 5%).

The Power and Control segment makes and sells systems and components that provide or control power for aircraft. Its products operate through electronics, fluid (hydraulic), and mechanical motion control. The segment offers mechanical/electro-mechanical actuators and controls, ignition systems, pumps and valves, power conditioning devices, AC/DC electric motors and generators, and cargo loading systems.

The Airframe division produces non-powered systems and products that are used in the airframe, for example, latching and locking devices, connectors and elastomers, cockpit security components, and aircraft audio systems.

The Non-aviation segment includes products such as seat belts and safety restraints for ground transportation applications.

Geographic Reach

Cleveland, Ohio-headquartered TransDigm maintains approximately 110 manufacturing facilities throughout the US, Canada, Mexico, Europe, and Asia.

Sales and Marketing

The company sells its products primarily through its own sales organization with a business unit manager assigned to specific products and supported by account managers and sales engineers. TransDigm also uses several distributors that provide logistical support and serve as the primary customer contact for certain smaller accounts. Its major distributors are Aviall (a subsidiary of Boeing) and Satair (a subsidiary of Airbus). The company's top ten customers account for more than 40% of sales.

TransDigm's business serving customers in the commercial, regional, business jet, and general aviation aftermarket accounts for around one-third of total sales. The commercial aerospace OEM market, comprised of large commercial transport manufacturers and regional and business jet manufacturers, accounts for roughly 25% of total sales. The defense market represents more than 35% and non-aerospace sales make up about 5%.

Financial Performance

n recent years, TransDigm steadily increased revenue, lifting such results from just under $2 billion in FY2015 (ended September 30) to FY2019 results exceeding $5.2 billion. In FY2019, the company's $5.2 billion sales figure represents a 37% increase over 2018. Organic sales—those from subsidiaries already within its family—saw a 7.9% increase in sales primarily driven by commercial aftermarket and defense sales; 13.6% increase in defense sales and 11.9% increase in commercial OEM sales.

Although faced with increased cost of sales, increased SG&A expenses, and higher interest expense, TransDigm's net income dropped to 7% lower in 2018 to $889.8 million primarily due to the discontinued operations.

Cash on hand at the end of the year was $1.5 billion, a decrease of $605.5 million from FY2019 (ended September). The company generated $1.0 billion in cash from operating activities. Investing activities used $3.9 billion, with most of it going to acquisitions costs. Financing activities provided $2.3 billion primarily from net proceeds from term loans and issuance of notes.

Strategy

TransDigm business strategy is made up of two key elements: a value- driven operating strategy focused around its three core value drivers and a selective acquisition strategy.

Value – driven operating strategy three core value drivers are obtaining profitable new business, improving its cost structure and providing highly engineered value-added products to customer by focusing on the engineering, manufacturing and marketing. TransDigm selectively pursue the acquisition of proprietary aerospace components business when they see an opportunity to create value through the application of its three-core value-driven operating strategies.

Consistent with overall strategy, its sales and marketing organization is structured to continually develop technical solutions that meet customer needs. TransDigm attempt to focus on its products and programs that will lead to high-margin, repeatable sales in the market.

Another revenue producing endeavor arises from the proliferation of its componentry across manufacturers and industries. It has a large install base, estimated to be over 100,000 aircraft, for which it is typically the sole source of replacement and aftermarket products.

Mergers and Acquisitions

TransDigm acquires companies that offer niche products that fit well with other subsidiary operations or have significant aftermarket sales.

The company went beyond that pattern in 2019, when it spent $4 billion to buy Esterline Technologies Corp, an aerospace and defense parts supplier with a large aftermarket portfolio including knobs, sensors, and materials. (TransDigm had purchased the Kirkhill elastomers business from Esterline in 2018 for $49.3 million). Esterline, which had $2 billion in annual revenue, brings its platform of proprietary and sole-source products for the aerospace and defense industries, including significant aftermarket offerings.

Advanced Input Devices, Inc.

600 W Wilbur Ave
Coeur D Alene, ID 83815-9496
Phone: 1 (208) 765-8000

Firm Stats

Employer Type: Privately Owned
Director Of Pharmacy Services: Scott Byre
Vice President Engineering: Craig Moss
V Pres: James Tsadilas
Employees (This Location): 325
Employees (All Locations): 330

Major Office Locations

Coeur D Alene, ID