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1 TIMET
Commercial Aerostructures Market Finally Ready for Take-off
Henry S. Seiner TIMET
2014 09.22
2 TIMET
Disclaimer Certain of the information presented herein relates to matters that are not historical facts but are forward-looking projections/statements that involve risks and uncertainties associated with TIMET’s business that are described more fully in TIMET’s filings with the United States Securities & Exchange Commission. Actual future results could differ materially from these projections. You rely on these projections and other information in this presentation at your own risk, and TIMET assumes no duty to update any of this information should expectations change.
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3 TIMET
Traffic Backlog Drivers
Integration Trends Forecast
3
4 TIMET
Record Backlogs
4 Source: Boeing, Airbus
5 TIMET
Record Backlogs
5
650K MTs of titanium demand over life of the backlog.
Source: Backlogs per Boeing and Airbus, Buy weight estimates per Goldman Sachs
AircraftApproximate Airframe Ti
Demand (MTs)Approximate
Years of Backlog737 125,000 7747 10,000 2767 5,000 3777 90,000 3787 85,000 7
Total 315,000
Boeing Backlog by Aircraft
AircraftApproximate Airframe Ti
Demand (MTs)Approximate
Years of BacklogA320 170,000 9A330 25,000 2A350 90,000 7A380 50,000 6Total 335,000
Airbus Backlog by Aircraft
6 TIMET
Traffic Backlog Drivers
Integration Trends Forecast
6
7 TIMET
World Traffic
7 Source: June 2014 Airline Monitor
Region 1990 2013 2035US 41% 27% 13%Europe 27% 27% 19%Asia Pacific 19% 30% 43%
SHARE OF WORLD TRAFFIC
8 TIMET
World Traffic
8
↑2.5% ↑6.8% ↑6.2% ↑6.2%
↑3.6% ↑7.4%
Source: June 2014 Airline Monitor
9 TIMET
Traffic Backlog Drivers
Integration Trends Forecast
9
10 TIMET
Oil & Aircraft Deliveries
10 Source: www.titudorancea.com
11 TIMET
Oil & Aircraft Deliveries
11 Source: June 2014 Airline Monitor and www.titudorancea.com
12 TIMET
Oil & Aircraft Deliveries
12 Source: June 2014 Airline Monitor and www.titudorancea.com
13 TIMET
Retirements
13 767 retired for 787 747-4 retired for 777-300 ER
Source: June 2014 Airline Monitor and Aviation Week
14 TIMET
Traffic Backlog Drivers
Integration Trends Forecast
14
15 TIMET
Increasing Ti per Plane
15 Source: Goldman Sachs
16 TIMET
Other Trends
16
Ultra Clean, Highly Spherical Metal Powders Supply chain is responding to demands with new technologies
17 TIMET
Traffic Backlog Drivers
Integration Trends Forecast
17
18 TIMET
Supply Chain Alignment
PCC acquires Exacta Aerospace
RTI acquires Dynamet Technology
Alcoa acquires Firth Rixson
Leggett & Platt acquires David Hart Aerospace Pipes Ltd
PCC acquires ADI
Triumph Group acquires GE Aviation Hydraulics
Sifco acquires MW General
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul
ATI acquires Hanard Machine Inc
RTI acquires Directed Manufacturing
PCC acquires SOS Metals
Héroux Devtek acquires BBA Aviation PLC
RTI acquires Osborn Steel Extrusions
ATI acquires Dynamic Flowform Corp
PCC acquires Designed Metal Connections
PCC acquires Summit Machining Inc.
19 TIMET
Aerospace & Defense M&A
19 Source: www.imaa-institute.org
20 TIMET
Traffic Backlog Drivers
Integration Trends Forecast
20
21 TIMET
Making Sense of Airline Monitor Forecasts ??
21 Source: Airline Monitor
22 TIMET
Airline Monitor Forecast: 2014-2020 Deliveries
22
January 2006 Forecast
2014 Deliveries = 1315 2017 Deliveries = 1495 2020 Deliveries = 1695 Source: Airline Monitor
23 TIMET
Airline Monitor Forecast: 2014-2020 Deliveries
23
January 2008 Forecast
2014 Deliveries = 1120 2017 Deliveries = 1615 2020 Deliveries = 1720 Source: Airline Monitor
24 TIMET
Airline Monitor Forecast: 2014-2020 Deliveries
24
January 2010 Forecast
2014 Deliveries = 1180 2017 Deliveries = 1200 2020 Deliveries = 1825 Source: Airline Monitor
25 TIMET
Airline Monitor Forecast: 2014-2020 Deliveries
25
January 2012 Forecast
2014 Deliveries = 1590 2017 Deliveries = 1540 2020 Deliveries = 1710 Source: Airline Monitor
26 TIMET
Airline Monitor Forecast: 2014-2020 Deliveries
26
June 2014 Forecast
2014 Deliveries = 1580 2017 Deliveries = 1990 2020 Deliveries = 2180 Source: Airline Monitor
27 TIMET
Airline Monitor Forecast Recap
27
Build Rate Year January 2006 AM Forecast
January 2008 AM Forecast
January 2010 AM Forecast
January 2012 AM Forecast
June 2014 AM Forecast
2014 1315 1120 1180 1590 1580
2017 1495 1615 1200 1540 1990
2020 1695 1720 1825 1710 2180
Source: Airline Monitor
28 TIMET
Forecast
28 Source: June 2014 Airline Monitor and internal TIMET estimates
29 TIMET
Commercial Aerostructures Market Finally Ready for Take-off
Henry S. Seiner TIMET
2014 09.22