An aphorism of the corporate world holds that turnover is vanity, margin is sanity. In other words: grow sales all you want, it's profits that count. By that logic, our Top 100 rankings contain a troubling finding.
The combined profits of aerospace's manufacturing elite fell 17% last year, after climbing 8% in 2008. What's more, revenue grew just 0.6% (2008: 7%).
Of course, reverses were inevitable given the havoc wreaked by 2008's banking crisis. Nor is it surprising to see Boeing regain the number-one spot. The airframer bounced back from its machinists' strike of late 2008 to boost commercial deliveries by 106 aircraft last year.
What is perhaps unexpected is that many players did manage to command high margins amid the general purse-tightening. Tending to focus in niches - aftermarket support, electronics - these included TransDigm, FLIR, Precision Castparts and Garmin. All could outgun higher-ranked rivals in profitability if not name recognition.
In 2010, niche players are a target of financial investors that kept their powder dry last year. Consolidation is certain to influence next year's Top 100, as will a reversal of 2009's sectoral split, with civil aerospace resurgent while defence players - relatively prosperous last year - face the certainty of budget cuts. However the drama unfolds, industry giants will hope 2010's figures give a boost to their health, if not their egos.
Source: Flight International
