Melrose Investor Day Presentation Deck
Melrose
Conclusion higher potential
Leading Tier 1 supplier in the aerospace industry - highly resilient market position
Product on over 90% of commercial aircraft¹ with entrenched customer relationships
95% of revenue from industry leading positions²
For >70% of revenue GKN Aerospace is the single source supplier, providing excellent long-term visibility
Excellent technology portfolio focused on sustainability
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Buy
Improve
Sell
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Well positioned for market recovery and growth
Blended revenue CAGR of 7% to 2030
Faster recovery and higher growth to 2025 (>10% CAGR)
Aftermarket rising to 50% of the Engines business by 2030
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Strong, long-term cash generation
Expected lifetime cash inflow of c.£18.5bn on 19 engine contracts (NPV³ of c.£5bn), these contracts represent less than 20% of
Aerospace revenue today (5% of Melrose)
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Upgraded operating margin target to 14%+
Accelerated progress on restructuring with all projects launched and moving rapidly
Clear path to 14%+ operating margin on a full market recovery
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1. GKN Aerospace engine or airframe content onboard aircraft over 100-person capacity produced today
2. Leadership position means number 1, 2 or 3 in the global market, by sales, in aerostructures, aerospace engine systems and aerospace electrical distribution
3. Using a foreign exchange rate of USD:GBP of 1.30:1 and calculated using the midpoint between a debt related discount rate of 5% (NPV c.£7bn) and a GKN Aerospace pre-tax weighted average cost of capital discount rate of
10% consistent with data in the Melrose Industries PLC 2021 Annual Report (NPV c.£3.5bn)
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