Graham Warwick/WASHINGTON DC
BFGoodrich is ahead of schedule in its integration of the former Coltec Industries, which it bought for $2.2 billion in July last year, and expects to extract anticipated savings earlier than expected.
The Charlotte, North Carolina-based parts and repair specialist initially projected post-merger savings of $60 million after three years, with $25 million coming from consolidation at corporate level and $35 million from operations, mostly in landing gear. BFGoodrich Aerospace president Marshall Larsen says the latter saving should now come early.
"We said integration would take 36 months, with the lion's share of the hard work in landing gear, but we are well on the way."
Aerospace now accounts for 64% of revenues, and the former Coltec engineered industrial products business almost 13%. The balance comes from the performance materials sector, which will be sold.
BFGoodrich sales to airframers are declining as Boeing production rates fall, but aftermarket business is growing as fleets expand. Sales to Airbus are relatively flat, but the company hopes to win more business. Tight margins in the heavy maintenance business have also caused BFGoodrich to refocus on airliner modification and, recently, business jet completions "where the value added is higher".
Landing gear was the only area of significant overlap between the merged companies, and other businesses acquired, including aircraft seating, engine components and coatings, "fit well", Larsen says.
The only Coltec aerospace business not growing is the Chandler Evans full-authority digital engine control unit, but Larsen says there are no plans to divest any of the new units, and that a new strategy will be devised for it, involving "working more with engine companies".
BFGoodrich is "never off" the acquisition trail, he adds, pointing out the company has recently entered the space components business through acquisitions.
Source: Flight International