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Operations & Financial Advisory for Military Aircraft Repair Station

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Home·Operations & Financial Advisory for Military Aircraft Repair Station

The Situation

Repair station for small and medium-sized military aircraft. $70 million annual sales. $12 million bank debt.

  • Inability to manage fixed fee contracts and growth.
  • The Company had embarked on an ambitious growth strategy to triple its revenues within five years, thinking “if they build it, they will come.”
  • After three years, the Company had missed revenue targets, customer deliveries, suffered massive losses, defaulted on its bank loan covenants, and terminated its CEO.
  • The Company needed a plan that was capable of execution to re-establish its credibility with its employees, customers, and bank, and position the company for profitability.

How We Advised

Our experts brought in an industry expert with prior experience in owning and operating MRO facilities in the aerospace sector to analyze the Company’s bidding procedures, contracts, and operational processes, in order to determine the reasons for contract losses.

  • We analyzed the Company’s operations to identify changes or reductions to the cost structure.
  • Performed financial analysis to assess the reasonableness of the Company’s projections and the impact on the Company’s cash flow and liquidity situation.
  • Created a comprehensive restructuring plan in six weeks that would restore the Company to profitability. The plan required significant changes at all levels to achieve a 10% further reduction of its cost structure. Assisted with the implementation of Phase 1 of the plan.
  • Implemented a detailed cash flow forecasting model to provide visibility and manage cash flows more tightly.
  • Created management tools for monitoring progress on long-term contracts to provide early warning signals of potential losses. Made recommendations for changed procedures for building up costs when bidding on new contracts to mitigate potential future losses.
  • The Company was able to restore profitability and improve the accuracy of its forecasts by implementing the plan based on recommendations made by our team.
  • The Company was able to secure an extension of its loan based on greater confidence in the deliverability of the plan, better management, monitoring, and disposition of excess assets.

Key Contact

Dan F. Dooley, CTP 
Senior Managing Director 
Strategic Advisory Practice 
+1 603 660 8952 
[email protected] 

Related Practice Areas

> Business / Operational Assessment 
Most consulting firms approach a business assessment from a purely financial perspective — our assessments provide a 360° view of a business, addressing growth drivers, profitability, and uses of capital. Along with detailed financial performance reviews and cash flow forecasting, our comprehensive Business / Operational Assessment identifies the various challenges clients encounter throughout their operations. 

 

> Turnaround and Restructuring Services 
Navigating the many challenges confronting a company in transition requires an operationally focused approach that looks beyond the balance sheet to minimize further degradation and build a path to sustainable growth. Drawing upon decades of experience in the turnaround space, we help companies in transition identify practical strategies to improve profitability and liquidity for immediate relief, while concurrently developing and executing a comprehensive turnaround plan for long-term, sustainable value creation. 

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