In Fokker Technologies, a world-class aerospace and defense company, and 100 years of aircrafting experience, are brought together
Eyrir Invest sold its 17% holding in Fokker Technologies in July 2015
Fokker Technologies is a leading global aerospace specialist that designs, develops and manufactures highly engineered aircraft systems to aircraft manufacturers and provides through-life aircraft fleet support services. Fokker’s main advantage is its capability to approach aircraft systems design from the perspective of an aircraft manufacturer and understanding the aircraft and its operation as a whole.
The company operates through its principal units:
- Fokker Aerostructures: light-weight aerostructures e.g. tails, wing components, fuselage panels
- Fokker Elmo: electrical wiring and interconnection systems
- Fokker Landing Gear: landing gear
- Fokker Services: aircraft and parts availability services
Headquartered in the city of Papendrecht, the Netherlands, Fokker operates facilities in the Netherlands, Romania, Turkey, Canada, Mexico, the USA, Singapore and China. Fokker currently has 4.900 employees.
Strategy
By improving its financial performance and long-term health, Fokker aims to reinforce its position as a Tier 1 specialist over the next five years. In order to achieve this, Fokker needs to deliver on its ramp-up promises, improving its balance between affordability and technology, whilst sustaining its technology leadership by acting more as One Fokker. Fokker will deliver on its ramp-up promises in line with the customers’ production heartbeat, as it has done many time previously for other existing aircraft programs. Fokker has an above market revenue growth potential backed by a strong order book.
To ensure a sustainable position for new aircraft programs, it is vital for Fokker that it remains a technology leader. This is also what customers rely on. Fokker will continue to cooperate closely with its customers to support them in the development of more competitive aircraft and increased operational competitiveness.
Operations 2014
Revenues in 2014 amounted to €758 million and operational EBIT increased markedly from previous year to €53 million by stronger performances in both the Design & Build and Services segment. In 2014 Fokker improved operational excellence through higher productivity and efficiency, supply chain management and by enlarging its global footprint. In particular the results of the recurring programs of the Design & Build showed this improvement. Operational cash flow was €45 million, €19 million higher than in 2013.
Revenue in the Design & Build segment amounted to €561 million. Fokker saw a decrease in non-recurring revenues and an increase in recurring revenues, as more design programs from prior years end and production on these programs picks up. Design & Build increased its operational EBIT by 11% to €56 million, largely as a result of improved margins in the recurring area. Revenue in the Services segment amounted to €201 million. The key challenge for Services is to grow non-Fokker aircraft business. This is to compensate for the declining Fokker aircraft revenue driven by less flight hours, and Fokker aircraft transfers to operators that fly less. Profitability of the Services segment more than doubled to €8.5 million.
Market focus
The Design & Build market is dominated by the Original Aircraft Manufacturers (OAMs), such as Airbus and Boeing, and suppliers providing subsystems to the OAMs, known as Tier 1 suppliers. Fokker is regarded as a Tier 1 specialist, and derives its seat at the table of the OAMs based on its advanced technologies.
The civil aerospace market is expected to grow by 5% per annum in the coming 15 years. In this segment, the B737MAX, B787, A320neo and A350XWB are ramping up production and will represent 60% of the commercial production value by 2020. In the defense segment, emerging markets sales and the F-35 program are driving new production, with the F-35 representing 30% of the total defense market by 2020.
The business jet segment is expected to return above-average growth following a recovery after the economic downturn, with the high speed/long-range business jet aircraft segment expected to recover particularly well.
Outlook
Fokker is now preparing for a considerable ramp-up in some of its aircraft programs over the coming years. Fokker’s overall outlook is strong, partly based on the well-balanced order book, including the Airbus A350XWB, the Lockheed Martin F-35 Lightning II, the Dassault Falcon F5X and Bombardier CSeries programs. These are multi-year contracts that will result in a step up in revenue in the coming years.
Fokker continues to partner with aircraft manufacturers and operators for these ramp-ups, to develop new business and with smart and affordable integrator solutions Fokker will support the affordability initiatives of its customers in the recurring and non-recurring aircraft programs. For 2015, Fokker remains focused on strengthening its market position in aerostructures, electrical systems and landing gear and further developing Fokker Services.
