Independent MROs Investing In Capabilities, Growing Profits

By Henry Canaday
Source: Aviation Week & Space Technology

JAS grows because “we deliver what we promise,” Beltran emphasizes. “Meeting customer expectations is not enough. We need to anticipate and surpass expectations.” He says even powerful engine OEMs often receive poor service from suppliers.

Beltran expects JAS may acquire other businesses in two or three years.

Another independent engine service provider, Prime Turbines, part of Killick Aerospace Group, also is looking for new businesses that complement its current PT6 maintenance activities.

Capital is no constraint. The hurdle in acquiring companies is finding the right opportunities. Prime Turbine looks for ongoing MRO businesses it believes it can grow. The MRO will probably add another corporate-aircraft engine type to its capabilities in 2014, says John Waldrop, vice president of sales.

“We would like to grow 10 percent per year, but that is tough,” he says. “People say flat is the new up, but if we see a good opportunity we will take it.”

Turbine Controls generates $30 million a year working on engine accessories, rotating components, gearboxes and cases, says sales executive Andrew Walmsley. At the start of 2013, it purchased World Aircraft Accessories' assets that enable repair of pneumatics, hydraulics and electro-mechanical components, its first nonengine capabilities.

Turbine's five-year plan is to continue growing, expand its Connecticut facilities, identify products and processes it can pursue, and consider different aircraft. The company aims for a 5% annual growth rate. “You can try to grow your slice of the pie or look for more pies,” Walmsley explains. “We look for more pies.”

Privately held Turbine funds growth internally, and Walmsley says obtaining capital is not a challenge, so long as there is a history of return on investment.

Recognizing that OEMs now control the engine aftermarket, Turbine seeks to partner with them. Walmsley notes, “if you are adversarial, you will have a problem in the medium to long term because the independent engine market is shrinking.”


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