summer 2013 aerospace / defense and government services · government strategy to reduce...

Summer 2013

8000 Towers Crescent Drive Suite 1200

Tysons Corner, Virginia 22182 703.442.1400

www.kippsdesanto.com

Aerospace / Defense and Government Services MarketView

http://www.kippsdesanto.com

(1) See pg. 9 for Aggregate Aerospace Suppliers, inclusive of Aerospace Systems and Structures companies.

(2) Wall Street Research, OMB, Deltek 2

Aerospace / Defense and Government Services MarketView Summer 2013

Operational / Funding Environment

The 50th Paris Air Show showcased robust order flow and new platform rollouts by the commercial aerospace original equipment manufacturers (“OEMs”). On the third day of the event, Airbus stole the show with the highly anticipated flyover of its A350, just one week after the wide-body jet’s maiden flight. The introduction of the A350, which received 69 orders from four customers on different continents, heightened the competition between Airbus and Boeing in the fuel-efficient, wide-body jet market. Ultimately, Airbus topped Boeing with respect to total purchase orders at the show, totaling 446 aircraft at a list price of $69 billion while Boeing secured 442 aircraft orders valued at $66 billion. Both companies are well positioned for the future with Airbus’ backlog totaling more than 5,000 aircraft, the equivalent of seven years of sustained production, and Boeing’s commercial airplane backlog growing to a record $338 billion. Additionally, large orders for single-aisle, narrow-body jets confirmed a shift in global demand towards the space. Airbus’ narrow-body A320 family, led by the A320neo which is due out in 2015, accumulated 371 orders worth ~$37.8 billion. Boeing was also able to capitalize on the trend, coupling a successful week of 787 orders by securing 317 orders worth ~$29.7 billion for its 737 narrow-body models, highlighted by the 737 MAX efficiency model due out in 2017. Embraer also had an impressive showing in the narrow-body market, stepping out of the Boeing / Airbus shadow with the launch of its new E2 series of jetliners. The Brazilian narrow-body jet maker locked down high profile orders from SkyWest, Inc. and International Lease Finance Corp., both of which placed orders for 100 planes. With the large number of orders and record backlogs, there is high visibility in the market, creating a healthy environment for suppliers. According to analyst estimates, the aggregate revenue for aerospace suppliers is expected to exceed $45 billion in 2014, representing an 11.7% compound annual growth rate (“CAGR”) since 2011.

The impact of sequestration has become more tangible from a defense standpoint over the past few months with the Army’s forced personnel cuts and restructuring, as well as the implementation of a furlough period for roughly 650,000 Department of Defense (“DoD”) civilian employees, which ended during the week of August 12

th. Army Chief

General Ray Odierno announced a plan that aims to cut 12 brigade combat teams (“BCT”) from active duty by 2017. The reduction in BCTs from 45 to 33 depicts one piece of the Army’s strategy to trim its force by almost 80,000 soldiers over the next three and a half years, and also serves as an indication of the likelihood for more substantial personnel cuts if sequestration continues beyond 2014. Despite the future outlook, broad furloughs for DoD civilian employees, which began July 8

th, ended during the week of August 12

th after the DoD was able to find additional

funding to cut the number of furlough days from eleven to six days.

Despite sequestration taking effect at the start of 2Q13, Federal spending remained higher than expected as the broader economy improved. One projected area of modest growth is IT spending, expected to drive innovation and efficiencies. Total GFY2014 requested Federal IT spending of $82.0 billion is a 2.1% increase over $80.3 billion in GFY2012. The largest proposed budget increases include Veterans Affairs (“VA”) at 22.8%, Treasury at 10.0%, and Department of Homeland Security (“DHS”) at 9.2%. The VA continues to be relatively insulated from broader cuts, in part due to increased pressure to reduce the large backlog of Veteran benefit claims. As part of a broader government strategy to reduce procurement costs and budget outlays, agencies have also requested $18.3 billion for shared services efforts in GFY2014, up from $12.1 billion in GFY2012. The VA plans to spend over 90% of total major investments on shared services technologies, while DHS and Health and Human Services (“HHS”) expect shared services to comprise more than 60%, respectively. Finally, as intelligence agencies move to fulfill Intelligence Community Information Technology Enterprise (“IC-ITE”) goals, the total award value of cloud solutions and services has more than quadrupled from $0.8 billion in 2011 to $4.0 billion in 2013, providing another growth avenue for public and private sector companies.(2)

Firm Orders / Commitments at the 2013 Paris Air Show

(# in actuals)

Aggregate Aerospace Suppliers 2011 – 2014P Revenue(1)

($ in billions)

Airbus Boeing

Model Orders / Commit. Model Orders / Commit.

A320 371 737 317

A330 6 747 5

A350 69 777 15

A380 20 787 105

Total 466 Total 442

$32.5 $37.4 $41.7 $45.4

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

2011 2012 2013E 2014P


(1) Capital IQ, company filings, and KippsDeSanto research 3


Capital Markets and Public Market Valuation Trends

Aerospace and defense shares continued to experience positive performance in the second quarter, building on the trends experienced in the first quarter. Following a successful Paris Air Show, the aerospace sector is consistently outperforming the market with increased order activity, growing backlog, and accelerating production schedules. Players in the defense sector remain on a positive trend following additional clarity on sequestration earlier this year with the passing of the Continuing Resolution (“CR”), though long-term uncertainty still persists. Aerospace shares continue to perform well as the commercial jet delivery and order environment remain healthy, returning 18.1% year to date (“YTD”) through July 31. Record high backlog and significant numbers of new orders are driving the industry’s strong performance. As the industry maintains its positive momentum, Wall Street analysts have reinforced their sanguine view on the market as the percentage of “Buy” ratings remains above 75%. Boeing, although faced with negative 787 headlines, holds an estimated $338 billion in commercial airplane backlog, and has seen its shares rise by 39.5% YTD through July 31. Smaller jet makers are also experiencing tremendous success, including Embraer, which collected over 200 orders at the Paris Air Show, further demonstrating the global demand for fuel-efficient planes. However, as large orders on newer models are made due to low interest rates and innovation in fuel efficiency, older aircraft models are increasingly being retired, resulting in a surplus of spare parts and creating pressure for aftermarket suppliers such as B/E Aerospace to foster continuous growth. Amidst a budgetary environment that is nagged by uncertainty, defense companies have delivered solid financial results, and their shares have responded positively, up 28.5% YTD through July 31. On the whole, equity analysts view the defense market as having bottomed out last year as the percentage of “Buy” ratings has increased while the proportion of “Hold” and “Sell” ratings has decreased. The CR passed earlier this year effectively alleviated growing concerns of a government shutdown, pushing defense shares to well outperform the broader market, reaching previous highs from 2007. However, a sense of uncertainty persists with this optimism as the likelihood of a CR renewal is still unknown. In response, defense primes are acclimating to the current environment by stressing operational efficiencies and seeking new opportunities. Lockheed Martin launched a new international arm based in London, Lockheed Martin International, to grow its global presence and soften potential effects of pending domestic budget cuts. Additionally, Northrop Grumman is up 36.2% YTD through July 31 after successful landing demonstrations of its X-47B unmanned combat air system and nearly $1 billion in new contracts from the DoD and UK Ministry of Defense.

Through July 31st, our Government Services index returned 27.8%, compared to 15.3% for the S&P 500. CACI

issued FY2014 earnings guidance in line with estimates, projecting revenue between $3.5 – $3.7 billion, and EPS between $5.70 – $6.10. As the government prioritizes procurement of cost-effective solutions amidst a difficult budget environment, management noted expense reduction actions to increase operating margins and be more cost competitive. SAIC reaffirmed its FY2014 earnings guidance in line with estimates, expecting total revenue of $10.0 billion to $10.7 billion, and EPS of $1.16 to $1.33, and similarly mentioned operational improvements to drive cost reductions. SAIC paid a special dividend of $1.00 per share along with its regular dividend, in an effort to create shareholder value in light of an impending split of the company that has redirected time away from M&A efforts. To that end, SAIC said it remains on track for its planned separation into two companies later this year, which is expected to streamline operations and improve efficiency. Separately, some government contractors have attributed diversification into commercial markets as a catalyst for growth. For instance, ICF International beat 1Q13 revenue and EPS estimates when it announced revenue of $233.9 million and EPS of $0.51. Management noted 14.3% year-over-year growth in commercial revenue enabled the company to report higher 1Q13 revenue, even as a (2.8%) decrease in Federal business revenue weighed on the business.

(1)

Relative Stock Price Performance(1)

YTD Ended July 31, 2013

Public Company Analyst Recommendations(1)

As of June 30, 2012 and June 30, 2013

90

95

100

105

110

115

120

125

130

135

Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13

Defense Primes Defense Systems Aerospace Government Services S&P 500

2Q13

Sell Hold Buy Sell Hold Buy

Defense 11% 62% 27% 5% 61% 34%

Aerospace 4% 20% 76% 3% 21% 77%

2Q12

27.8%

28.5%

15.3%

18.1%

24.3%


(1) Capital IQ, company filings, and KippsDeSanto research

(2) KippsDeSanto & Co. acted as exclusive financial advisor to both Max-Viz and Ballard in these transactions 4


M&A Trends and Activity

In the continued wake of tax-related / year-end selling in 4Q12 and uncertainty in spending policy changes, there was a decline in the volume of M&A transactions this past quarter. A total of 37 aerospace and defense transactions were announced in 2Q13 compared to 63 transactions during the same period last year.

Relative private equity involvement decreased in the aerospace and defense sectors, with only 30% of deals involving a financial sponsor in 2Q13 compared to 48% of deals in 1Q13. The environment arising from a potential $500 billion budget cut over the next 10 years resonates in the defense M&A landscape as companies are looking to either strengthen existing business sectors or divest lagging operations to prepare for future changes. Fittingly, the majority of defense transactions in 2Q13 were strategic acquisitions, including Colt Defense acquiring New Colt Holding Corporation, creating a single company to develop, manufacture, and sell firearms under the Colt brand for the first time in nearly a decade. Conversely, EADS, which rebranded itself by its commercial moniker, Airbus, stated it will consider divesting and consolidating parts of its defense business to boost profitability amidst an uncertain future outlook. Activity within the aerospace market continued to lean towards the components and subsystem subsector, though the capabilities mix was much more even when compared to 1Q13. The continued transaction activity in the components and subsystem subsector indicates the growing need for buyers to not only further develop their own technologies, but also expand into new strategic markets. Active players in the aerospace industry are being generously rewarded in the market to the extent their M&A strategies are well-conceived and executed. One such example is Astronics, up 72.7% YTD through July 31 after acquisitions of PECO in 2013, Max-Viz in 2012, and Ballard Technology in 2011.(2) Additionally, TransDigm is up 6.0% YTD through July 31 following its acquisition of Arkwin (its third acquisition of the year) to strengthen its core platforms and engine applications, and Precision Castparts is up 17.1% YTD through July 31 following its $600 million acquisition of Permaswage (its third acquisition of the year) to expand its fitting capabilities, both represent an ongoing trend of buyers finding appealing opportunities in the aerospace field.

For government services, 2013 has seen a slowdown in M&A activity. While announced transactions in the first half of 2013 are down ~52% over the same period last year, market activity and acquisition appetite remain strong. For instance, in ICF’s spring investment presentation, the company noted flat year-over-year organic growth following first quarter results, and that an active acquisition pipeline remains a sustainable growth strategy. Furthermore, in CACI’s initial FY2014 guidance call, management reiterated its commitment to growth via acquisitions and indicated that the company is in the market for transactions as large as $1 billion. This strategy is noteworthy considering CACI’s last ten acquisitions have all been sub-$150 million transactions. Furthermore, the market has seen a continued trend of divestitures by companies looking to focus strategy, position in growing markets, and create value for shareholders. Noteworthy transactions include the divestiture of a portion of SRA’s Health Sciences Research business to Social & Scientific Systems in July as well as CSC’s announced divestiture of its Applied Technology Division to PAE for $175 million. The announced CSC transaction would be the company’s sixth divestiture in seven months as it continues to divest non-strategic assets. Specifically, David Zolet, the head of CSC’s North American public sector business, said that the business did not fit the company’s focus on new technologies, such as cloud computing and cybersecurity.

M&A Transaction Volume(1)

e

1924

1116

21 2518

2721 17 16 18 14

2617 21

16 13

1415

1311

1512 22

18

1515

2932

20

37

2023

2724

9

20

2226

2517

3126

18 28

2222

24

24

24

34

13

1042

59

46

53

61

54

71 71

54

60

6772

58

87

61

78

56

47

0

10

20

30

40

50

60

70

80

90

100

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Defense Aerospace Government Services

2009200 deals announced

2010257 deals announced 2011

253 deals announced

2012284 deals announced


(1) Capital IQ, company filings and releases, and KippsDeSanto research 5


Defense Update

Defense Earnings Update(1)

Public defense firms have continued to beat expectations as some effects of sequestration have been pushed to the right and belt-tightening efforts have yielded efficiencies within large corporations. While there remains a considerable amount of uncertainty around future defense spending, the current environment has begun to stabilize, and defense companies are reporting stronger earnings with investors focused on the here and now. Raytheon reported strong earnings as a result of cost-cutting operational improvements and strong international sales. Lockheed Martin also beat analyst estimates and reaffirmed its growth message as part of its push into more international markets.

U.S. Troop Presence in Afghanistan, 2007-2014P(1)

(Numbers in thousands)

On June 18th, the lead for security operations officially transitioned from NATO to Afghan forces. With the end of NATO combat operations in Afghanistan scheduled for December 2014, NATO forces are increasingly transitioning to a “train-and-advise” role in support of the Afghan National Security Forces. As part of the transition, the U.S. is planning to keep 8,000 combat troops in Afghanistan after 2014; however, plans may change as the Afghan government will make the ultimate decision regarding international forces. For example, Afghan President Hamid Karzai temporarily suspended talks with the U.S. on future security arrangements in response to the U.S. opening negotiations with the Taliban. Though talks between the two countries resumed shortly after the breakdown, there remains persistent uncertainty around the future role of the U.S. in Afghanistan, as even the 8,000 troops slated to remain beyond 2014 are not a guarantee.

2013 European Defense Spending by Country(1)

Despite the failed BAE-EADS merger last year, the European Union (“EU”) continues to push for greater defense integration. In July, the EU Internal Market Commission released a number of recommendations to boost Europe’s struggling defense industry. At the heart of the report is a focus on Europe developing its own defense capabilities through government cooperation and integration. Currently, most EU defense integration has been the result of one-off deals, such as the agreement between the U.K. and France. However, areas such as research, technology, manufacturing, and procurement offer strong synergy cases. One recommendation includes the EU developing its own drone manufacturing capabilities rather than importing them. Another involves aircraft and naval refueling systems being jointly purchased and shared. With Europe facing a budget crisis, pooling resources can offer not only cost savings, but a boost to domestic defense capabilities.

27 30

68

9498 97 100 99

89

6860

158

0

20

40

60

80

100

120

Early2008

Early2009

Late2009

Early2010

Mid2010

Late2010

Early2011

Mid2011

Late2011

Late2012

Late2013E

Late2014P

Early2015P

2Q13 DEFENSE EARNINGS: FULL SEQUESTRATION IMPACT NOT YET FELT

UNCERTAIN FUTURE FOR U.S. FORCES IN

AFGHANISTAN

EUROPEAN UNION MOVES TOWARDS GREATER

DEFENSE INTEGRATION


(1) Capital IQ, company filings and releases, and KippsDeSanto research 6


Aerospace Update

Aerospace Earnings Update(1)

Aerospace companies reported strong earnings for the past quarter as they continue to capitalize on a growing demand for aircraft. On the heels of its success at the Paris Air Show, Boeing reported earnings above analyst estimates, citing new orders of the 787 and rising backlog as main growth drivers. Rockwell Collins also exceeded expectations, reporting EPS 5% higher than analyst estimates, as the company expects continued growth on the back of new programs such as the 787, A350, CSeries, MRJ, and new business jets. After divesting a number of large units from Pratt Whitney, United Technologies reported earnings above analyst estimates, and projects increased profits as demand for spare parts grows moving forward.

Embraer’s Continued Success in Small Aircraft Market(1)

The 2013 Paris Air Show was a clear success for a number of aerospace companies. One key trend was the continuing growth in sales of small body aircraft as a result of increasing demand from emerging markets. Among manufacturers specializing in smaller frame aircraft, Embraer launched its E-Jet E2 family and locked down 100 plane orders from both SkyWest and International Lease Finance Corporation. The Company also stated that it will offer newer versions of its larger E-Jets by the end of the decade, as well as more fuel efficient engines and modern wings. Embraer’s continued success and growing market share puts additional pressure on its primary competitor, Bombardier, who has experienced stagnant orders and delays on its CSeries model. However, analysts believe Embraer’s recent push is more of a threat to Bombardier’s CRJ business, and that the market is already demanding an upgrade in Bombardier’s regional jet fleet.

Long-Term World Aircraft Growth(1)

Boeing’s 2013 Current Market Outlook presents an optimistic view of the aerospace market for the 2013-2032 timeframe. According to the report, air passenger traffic increased by 5.0% in 2012, a growth rate that is expected to continue through 2032. Boeing also predicts a similar 5.0% annual increase in cargo traffic through 2032. Both of these outpace Boeing’s projected annual global GDP growth rate of 3.2%, and translates to an anticipated long-term demand of 35,280 planes over the next 20 years. Of this number, roughly 41% will be replacement orders for older planes. The remaining 20,930 new plane orders, indicative of fleet growth, are predicted to consist of approximately 70% single aisle planes. As such, the share of wide-body plane orders is expected to remain relatively flat, increasing from roughly 23% today to only 24% in the future. These trends are facilitated not only by the growth of emerging economies, but also a greater presence of air travel within these countries.

7,670

12,998

29,130

2,596

4,610

9,930

1,534

2,640

2,180

11,800

20,249

41,240

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1992 2012 2032

Single Aisle Widebody Regional Jet

2Q13 AEROSPACE EARNINGS: FLYING HIGH

UPGRADED EMBRAER E-JET FAMILY TAKING OFF

BOEING PREDICTS LONG-TERM AEROSPACE

MARKET GROWTH


(1) Capital IQ, company filings, and KippsDeSanto research 7


Government Services Update

YTD Government Services Performance Review(1)

Our Government Services index is outperforming the S&P 500, up 27.8% for the YTD period through July 31

st. Booz

Allen Hamilton beat expected FY4Q13 earnings with $0.40 EPS, and shares rose after the company issued FY2014 guidance above estimates. ICF beat 1Q13 revenue and EPS estimates, and announced the Company captured nearly 100 contracts worth ~$225 million. CACI, up 16.8% YTD through July 31

st, issued FY2014 guidance in line with

analyst estimates, and noted that expense reductions have improved operating margins and competitiveness. QinetiQ was removed from the KippsDeSanto comp set after the Company announced a potential sale of its U.S. services business. The announcement was made after a $385 million write down due to spending cuts by the U.S. government. Finally, Kratos announced 8.3% growth in year-over-year organic revenue and has since announced ten new awarded contracts with a total value of $74 million.

Total Contract Obligations Remaining(1) For GFY4Q12 and GFY4Q13

($ in billions)

In an effort to close out 2013 government fiscal year budgets, Federal agencies will likely analyze remaining procurement obligations and available spending dollars. Although a 10% cut was made from GFY2012 due to sequestration, the remaining procurement obligations for GFY4Q13 is $210.5 billion, a 66% increase from only $127.1 billion, not including previous cuts in GFY4Q12. This increase may result in a surge in procurements during GFY4Q13. Most notably, remaining obligations for the Army and Navy account for 64% and 49% of total GFY2013 obligations for respective agency. In total, military / DoD remaining procurement obligations for GFY4Q13 represent a 92.1% increase over GY4Q12, up to $184.6 billion from $96.1 billion. Thus, these agencies may see a burst of Federal spending despite overall budget cuts.

DoD Spending on Cyber Capabilities(1) ($ in billions)

According to a report obtained by Bloomberg, the Pentagon plans to spend $23 billion from 2014 to 2018 on defensive and offensive cyber capabilities, including $9.3 billion for information assurance systems and $8.9 billion for cyber-operations. Additionally, the Chairman of the Joint Chiefs of Staff, Martin Dempsey, says the Pentagon will add 4,000 cyber specialists over the next four years to build capabilities that will provide an “asymmetric advantage” in future conflicts.

As attacks multiply from sources such as state-

sponsored cyberespionage to rogue hackers, officials have made progress to define rules of engagement that permit offensive operations to stem breaches. With intrusions into U.S. critical infrastructure increasing 17-fold over the last two years according to the Brookings Institution, cyber spending is also expected to remain strong across civilian federal agencies, despite broader budgetary pressures.

$3.9$4.7 $4.7 $4.6 $4.5 $4.5

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

2013E 2014P 2015P 2016P 2017P 2018P

+4,000 Pentagon Cyber Specialists

GOVERNMENT SERVICES HAS SHARE OF POSITIVE

EARNINGS HEADLINES

POTENTIAL FOR SUBSTANTIAL 4Q13 PROCUREMENTS

ASYMMETRIC ADVANTAGE: PENTAGON FOCUSES BUDGET ON CYBERSECURITY

8.9

5.7 5.0 4.63.3 3.5

7.24.6 4.3 3.9 3.6

2.3

30%

46%

33%

60%

37%33%

14%

57%

42%

30%

58%

34%

40%

10%

$0.0

$5.0

$10.0

$15.0

$20.0

$25.0

$30.0

$35.0

$40.0

$45.0

$50.0

Military / DoD HHS VA State DHS GSA Energy

GFY4Q12 Remaining Obligation GFY4Q13 Remaining Obligation

2012 % of Total 2013 % of Total

96.1

$95.0

$100.0

$105.0

184.6

$180.0

$185.0

14%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


(1) Company filings, Capital IQ, and KippsDeSanto research 8


Public Company Trading Analysis(1) ($ in millions, except per share amounts)

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PDefense Primes 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

The Boeing Company $106.42 97.2% $80,288.0 $75,693.0 $84,838.0 $8,347.1 9.8% $92,610.0 $9,401.6 10.2% 0.89x 9.1x 0.82x 8.1x

Lockheed Martin Corporation 124.54 99.9% 39,745.3 43,040.3 44,934.9 5,611.0 12.5% 43,534.5 5,652.0 13.0% 0.96x 7.7x 0.99x 7.6x

General Dynamics Corp. 87.02 99.1% 30,445.5 30,595.5 31,265.1 4,250.1 13.6% 31,018.3 4,279.1 13.8% 0.98x 7.2x 0.99x 7.2x

Raytheon Co. 76.38 99.8% 24,631.9 26,070.9 23,632.3 3,235.9 13.7% 23,063.2 3,268.3 14.2% 1.10x 8.1x 1.13x 8.0x

BAE Systems plc 6.96 97.1% 22,486.0 24,282.5 29,151.8 3,643.4 12.5% 28,411.5 3,532.9 12.4% 0.83x 6.7x 0.85x 6.9x

Northrop Grumman Corporation 95.83 99.6% 22,056.7 23,085.7 24,311.2 3,411.5 14.0% 23,295.1 3,239.8 13.9% 0.95x 6.8x 0.99x 7.1x

Median 99.3% $27,538.7 $28,333.2 $30,208.4 $3,946.7 13.0% $29,714.9 $3,906.0 13.4% 0.95x 7.4x 0.99x 7.4x

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PDefense Systems 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

Rockwell Collins Inc. $74.69 99.8% $10,083.8 $10,897.8 $4,651.4 $1,119.1 24.1% $4,870.0 $1,149.7 23.6% 2.34x 9.7x 2.24x 9.5x

L-3 Communications Holdings Inc. 93.19 98.8% 8,348.4 11,744.4 12,564.1 1,458.0 11.6% 12,052.3 1,415.4 11.7% 0.93x 8.1x 0.97x 8.3x

Cobham plc 4.65 95.8% 4,957.9 5,557.4 2,649.5 578.3 21.8% 2,680.2 597.8 22.3% 2.10x 9.6x 2.07x 9.3x

FLIR Systems, Inc. 32.88 100.0% 4,665.1 4,567.5 1,530.8 385.0 25.2% 1,603.6 416.1 26.0% 2.98x 11.9x 2.85x 11.0x

Huntington Ingalls Industries, Inc. 63.33 99.0% 3,175.7 4,369.7 6,641.4 607.7 9.2% 6,641.3 683.2 10.3% 0.66x 7.2x 0.66x 6.4x

Alliant Techsystems Inc. 97.19 99.4% 3,119.5 4,293.9 4,411.3 598.0 13.6% 4,367.2 629.3 14.4% 0.97x 7.2x 0.98x 6.8x

Exelis, Inc. 15.19 97.1% 2,860.4 3,250.4 4,987.8 603.7 12.1% 4,762.2 622.8 13.1% 0.65x 5.4x 0.68x 5.2x

Kongsberg Gruppen ASA 18.68 81.5% 2,240.3 2,100.0 2,834.6 368.6 13.0% 3,069.0 402.1 13.1% 0.74x 5.7x 0.68x 5.2x

Cubic Corporation 51.77 96.8% 1,384.1 1,270.6 1,387.7 136.3 9.8% 1,424.9 150.2 10.5% 0.92x 9.3x 0.89x 8.5x

AeroVironment, Inc. 22.99 92.4% 511.1 362.5 215.3 7.7 3.6% 242.8 19.5 8.0% 1.68x NM 1.49x NM

Median 97.9% $3,147.6 $4,331.8 $3,623.0 $588.1 12.6% $3,718.1 $610.3 13.1% 0.95x 8.1x 0.98x 8.3x

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PDefense Electronics / Comm. 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

Harris Corporation $57.00 98.3% $6,246.2 $7,660.3 $5,058.9 $1,004.0 19.8% $5,102.9 $1,073.3 21.0% 1.51x 7.6x 1.50x 7.1x

Teledyne Technologies Inc. 81.83 98.0% 3,063.4 3,674.1 2,378.4 346.7 14.6% 2,495.3 382.0 15.3% 1.54x 10.6x 1.47x 9.6x

ViaSat Inc. 66.15 90.1% 3,005.9 3,519.4 1,274.7 213.3 16.7% 1,523.7 312.8 20.5% 2.76x 16.5x 2.31x 11.3x

Ultra Electronics Holdings plc 29.93 99.7% 2,075.9 2,148.6 1,200.0 209.0 17.4% 1,230.9 213.1 17.3% 1.79x 10.3x 1.75x 10.1x

Orbital Sciences Corp. 18.67 96.6% 1,123.3 1,059.6 1,400.5 150.8 10.8% 1,539.7 163.9 10.6% 0.76x 7.0x 0.69x 6.5x

Comtech Telecommunications Corp. 26.97 92.2% 442.4 300.2 308.8 48.1 15.6% 327.2 62.7 19.2% 0.97x 6.2x 0.92x 4.8x

Mercury Systems, Inc. 9.50 86.8% 307.1 268.0 212.4 19.7 9.3% 234.3 24.8 10.6% 1.26x 13.6x 1.14x 10.8x

Median 96.6% $2,075.9 $2,148.6 $1,274.7 $209.0 15.6% $1,523.7 $213.1 17.3% 1.51x 10.3x 1.47x 9.6x

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PHomeland Security 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

Smiths Group plc $20.27 89.7% $7,980.8 $9,346.9 $4,918.1 $1,010.0 20.5% $5,142.0 $1,075.3 20.9% 1.90x 9.3x 1.82x 8.7x

Mine Safety Appliances Co. 53.27 96.2% 1,979.9 2,208.5 1,186.5 188.3 15.9% 1,243.7 211.6 17.0% 1.86x 11.7x 1.78x 10.4x

OSI Systems, Inc. 69.00 84.9% 1,375.7 1,395.9 828.0 137.1 16.6% 921.2 175.6 19.1% 1.69x 10.2x 1.52x 7.9x

Analogic Corporation 73.40 86.6% 899.2 807.8 575.5 90.0 15.6% 635.0 111.7 17.6% 1.40x 9.0x 1.27x 7.2x

Smith & Wesson Holding Corporation 12.58 94.0% 810.3 759.6 537.8 129.5 24.1% 618.8 164.5 26.6% 1.41x 5.9x 1.23x 4.6x

Federal Signal Corp. 9.40 90.4% 586.9 735.4 820.2 68.9 8.4% 863.7 88.6 10.3% 0.90x 10.7x 0.85x 8.3x

Airboss of America Corp. 6.08 100.0% 137.5 147.7 232.8 19.2 8.2% 246.0 21.5 8.8% 0.63x 7.7x 0.60x 6.9x

Median 90.4% $899.2 $807.8 $820.2 $129.5 15.9% $863.7 $164.5 17.6% 1.41x 9.3x 1.27x 7.9x




Public Company Trading Analysis, cont.(1) ($ in millions, except per share amounts)

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PAerospace Systems 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

Zodiac Aerospace $148.77 98.8% $8,047.6 $9,439.8 $5,269.9 $874.3 16.6% $5,677.8 $961.0 16.9% 1.79x 10.8x 1.66x 9.8x

B/E Aerospace Inc. 72.24 99.2% 7,570.0 8,957.4 3,424.7 724.1 21.1% 3,833.3 844.3 22.0% 2.62x 12.4x 2.34x 10.6x

TransDigm Group Incorporated 143.03 86.9% 7,494.6 11,168.1 1,973.8 913.1 46.3% 2,215.2 1,022.4 46.2% 5.66x 12.2x 5.04x 10.9x

Meggitt PLC 8.41 94.3% 6,639.7 7,705.0 2,606.4 769.2 29.5% 2,748.4 822.1 29.9% 2.96x 10.0x 2.80x 9.4x

Triumph Group, Inc. 78.03 91.3% 3,760.9 5,156.1 3,877.5 698.0 18.0% 4,044.6 788.7 19.5% 1.33x 7.4x 1.27x 6.5x

Esterline Technologies Corp. 82.63 96.9% 2,584.7 3,205.0 2,039.2 367.1 18.0% 2,130.5 393.5 18.5% 1.57x 8.7x 1.50x 8.1x

HEICO Corporation 57.78 97.9% 2,526.3 2,898.5 1,009.4 228.2 22.6% 1,116.4 251.5 22.5% 2.87x 12.7x 2.60x 11.5x

AAR Corp. 24.58 94.0% 937.7 1,529.8 2,121.5 232.4 11.0% 2,123.8 242.0 11.4% 0.72x 6.6x 0.72x 6.3x

Astronics Corporation 39.93 93.0% 575.9 584.8 336.1 56.9 16.9% 408.2 82.2 20.1% 1.74x 10.3x 1.43x 7.1x

Median 94.3% $3,760.9 $5,156.1 $2,121.5 $698.0 18.0% $2,215.2 $788.7 20.1% 1.79x 10.3x 1.66x 9.4x

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PAerospace Structures 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

Precision Castparts Corp. $220.96 81.8% $32,277.8 $35,825.8 $9,733.2 $2,871.9 29.5% $11,060.0 $3,253.7 29.4% 3.68x 12.5x 3.24x 11.0x

Hexcel Corp. 36.57 99.5% 3,638.3 3,895.6 1,704.8 339.2 19.9% 1,869.2 388.9 20.8% 2.29x 11.5x 2.08x 10.0x

Spirit AeroSystems Holdings, Inc. 25.19 94.3% 3,619.1 4,484.5 5,978.5 711.4 11.9% 6,575.1 782.1 11.9% 0.75x 6.3x 0.68x 5.7x

Senior plc 4.34 97.3% 1,797.0 1,896.6 1,201.5 190.8 15.9% 1,281.2 205.7 16.1% 1.58x 9.9x 1.48x 9.2x

LMI Aerospace Inc. 18.39 79.3% 231.9 510.1 465.6 70.0 15.0% 516.9 83.7 16.2% 1.10x 7.3x 0.99x 6.1x

Median 94.3% $3,619.1 $3,895.6 $1,704.8 $339.2 15.9% $1,869.2 $388.9 16.2% 1.58x 9.9x 1.48x 9.2x

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PGovernment Services 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

SAIC, Inc. $15.69 99.4% $5,374.1 $6,109.1 $10,375.8 $766.7 7.4% $10,050.5 $843.9 8.4% 0.59x 8.0x 0.61x 7.2x

Booz Allen Hamilton 20.43 91.7% 2,842.9 4,161.5 5,702.0 544.2 9.5% 5,615.6 530.1 9.4% 0.73x 7.6x 0.74x 7.8x

QinetiQ Group Plc 2.80 84.1% 1,820.0 1,716.2 1,945.4 263.5 13.5% 1,922.3 249.4 13.0% 0.88x 6.5x 0.89x 6.9x

CACI International Inc. 66.81 98.6% 1,541.2 2,175.1 3,612.1 318.6 8.8% 3,564.4 315.9 8.9% 0.60x 6.8x 0.61x 6.9x

ManTech International Corporation 28.42 94.1% 1,056.0 1,062.4 2,393.7 173.5 7.2% 2,279.3 167.3 7.3% 0.44x 6.1x 0.47x 6.4x

ICF International Inc. 34.00 97.1% 672.1 741.7 962.3 92.4 9.6% 990.0 97.3 9.8% 0.77x 8.0x 0.75x 7.6x

Engility Holdings, Inc. 33.40 94.9% 572.6 882.8 1,456.7 137.4 9.4% 1,474.1 132.0 9.0% 0.61x 6.4x 0.60x 6.7x

The KEYW Holding Corporation 12.46 75.7% 456.9 544.1 336.9 36.7 10.9% 392.7 54.4 13.9% 1.62x 14.8x 1.39x 10.0x

Kratos Defense & Security Solutions 6.54 90.5% 370.5 966.1 982.6 114.9 11.7% 1,014.0 121.3 12.0% 0.98x 8.4x 0.95x 8.0x

Dynamics Research Corporation 6.41 87.8% 66.4 154.6 287.7 25.0 8.7% 283.2 24.3 8.6% 0.54x 6.2x 0.55x 6.4x

NCI, Inc. 5.00 62.5% 64.6 73.6 310.2 15.5 5.0% 288.6 13.3 4.6% 0.24x 4.8x 0.26x 5.5x

Median 91.7% $672.1 $966.1 $1,456.7 $137.4 9.4% $1,474.1 $132.0 9.0% 0.61x 6.8x 0.61x 6.9x

Stock Price % of 52 Market Enterprise CY 2013E CY 2014P EV / CY 2013E EV / CY 2014PEngineering & Construction 08/07/13 Week High Cap Value Rev. EBITDA Margin Rev. EBITDA Margin Rev. EBITDA Rev. EBITDA

Jacobs Engineering Group Inc. $59.41 95.3% $7,810.4 $6,990.1 $12,160.6 $785.1 6.5% $13,514.1 $898.1 6.6% 0.57x 8.9x 0.52x 7.8x

Babcock International Group plc 18.65 98.1% 6,696.5 7,638.9 5,240.9 624.6 11.9% 5,637.2 657.7 11.7% 1.46x 12.2x 1.36x 11.6x

URS Corporation 45.73 92.5% 3,424.7 5,419.2 11,745.5 891.5 7.6% 12,315.1 932.9 7.6% 0.46x 6.1x 0.44x 5.8x

AECOM Technology Corporation 29.49 83.7% 3,039.9 3,759.9 8,308.3 519.3 6.3% 8,638.4 617.5 7.1% 0.45x 7.2x 0.44x 6.1x

Tetra Tech Inc. 23.28 73.9% 1,511.5 1,618.6 2,068.1 158.4 7.7% 2,164.9 245.8 11.4% 0.78x 10.2x 0.75x 6.6x

Median 92.5% $3,424.7 $5,419.2 $8,308.3 $624.6 7.6% $8,638.4 $657.7 7.6% 0.57x 8.9x 0.52x 6.6x




Select Recent Aerospace / Defense M&A(1) ($ in millions)

Announce EBITDA EV / LTM

Date Buyer / Investor Target Target Description EV Revenue EBITDA Margin Revenue EBITDA

08/05/13 Micross Components, Inc. Premier Semiconductor

Services, LLC

Provides comprehensive array of outsourced final manufacturing

services in North America for commercial, military, and aerospace

applications

NA NA NA NA NA NA

07/23/13 Quality Aluminum Forge, LLC MW General, Inc. Supplies precision aluminum forgings to the commercial aerospace

industry

NA NA NA NA NA NA

07/22/13 Singapore Technologies

Engineering

Technicae Projetos e

Servicos Automotivos

Ltda.

Provides automotive maintenance, repair, and overhaul services to

military customers

$ 2.2 NA NA NA NA NA

07/22/13 Swissport International Ltd. Servisair GmbH Provides ground handling, cargo, fuelling, lounges, airport agencies,

central de-icing, and transportation services

599.7 $ 916.9 NA NA 0.65x NA

07/15/13 Cobham plc FB Heliservices Limited Provides helicopter aircrew training solutions, helicopters, helicopter

engineering support, and specialist manpower services to military and

government agencies

114.8 NA $ 31.0 NA NA 3.7x

07/15/13 Colt Defense LLC New Colt Holding Corp. Manufactures and sells arms and related accessories for military and

law enforcement use

60.5 NA NA NA NA NA

07/15/13 Edac Technologies Corp. Parkway Products

Aerospace & Defense

Business

Produces polymer-matrix composite engine components and

aerostructures for customers around the world

NA NA NA NA NA NA

07/11/13 Acorn Growth Companies

and The Edgewater Funds

Tods Aerospace &

Defense Ltd.

Engineers, designs, and manufactures advanced materials technology

for aerospace and naval acoustic structures

NA NA NA NA NA NA

07/08/13 Data Device Corporation National Hybrid Inc. Designs and manufactures military standard data networking

technology, specializing in critical components for the aerospace and

defense markets

32.5 13.0 4.4 33.5% 2.50x 7.5x

07/03/13 AMTEC Corporation DSE, Inc. Manufactures specialized military products including precision metal

components, assemblies, and ordnance products

NA NA NA NA NA NA

07/03/13 Zodiac Seats UK Limited Threesixty Aerospace

Ltd, Engineering

Department

Designs, develops, and manufactures business class seats for Virgin

Atlantic

NA NA NA NA NA NA

07/02/13 Cubic Corporation Advanced Interactive

Systems, Inc.

Provides technology-based training solutions for professionals in high-

risk environments

NA NA NA NA NA NA

07/02/13 Saturn Scientific -

Production Association Open

Joint Stock Co.

Ufa Engine Industry

Union

Produces aircraft engines, liquid propellant rocket engines,

transmissions for helicopters, and other engines / turbines

NA 668.3 NA NA NA NA

06/29/13 Sensintel Inc. BAE Systems'

Unmanned Aircraft

Programs

Engineers, designs, and manufactures unmanned aircraft systems for

defense purposes

NA NA NA NA NA NA

06/27/13 ESCO Technologies Inc. Canyon Engineering

Products, Inc.

Designs, develops, and manufactures industrial valves and fluid control

devices for aerospace and industrial applications

NA 12.0 NA NA NA NA

06/26/13 Precision Castparts Corp. Permaswage SA Provides mechanically attached aerospace tube fitting systems, radially

and axially swaged permanent fittings, end fitting systems, straight,

elbow, and U shaped swivel fittings, and MRO services

600.0 NA NA NA NA NA

06/25/13 Communications & Power

Industries LLC

M C L, Inc. Designs and manufactures power amplifiers and systems for the

satellite communications market

NA 55.0 NA NA NA NA

06/21/13 Senior Leadership Team led

by Matt Yerbic

Aviation Technical

Services

Provides MRO services for aerostructures and components for military,

commercial, and business aircraft

NA NA NA NA NA NA

06/21/13 TransDigm Group GE Aviation,

Electromechanical

Actuation Division

Manufactures aerospace motion control subsystems, including control

electronics, motors, and high power mechanical transmissions and

actuators

150.0 80.0 NA NA 1.88x NA

06/10/13 Paramount Group Advanced Technology

and Engineering

Company Ltd

Offers aeronautical engineering and integration services for civilian and

military systems, including unmanned aircraft and mission sensors

NA NA NA NA NA NA

06/06/13 Ultra Electronics Holdings plc Varisys Ltd Designs and manufactures embedded computer systems for the

aerospace, military, telecommunications, vestronics, and industrial

control markets

28.0 NA NA NA NA NA

06/05/13 Zodiac Aerospace SA La Jonchere Designs and manufactures hose systems, expansion joints, bellows ball

joints, and compensators

NA NA NA NA NA NA

06/03/13 MB Aerospace Delta Industries Provides engineering, manufacturing, and repair services for engine

components, including casings, rotating rings, and structural assemblies

NA 60.0 NA NA NA NA

05/29/13 PAE CSC Applied

Technology Division

Provides aviation maintenance, base operations and maintenance, test

and training range services, and space range services

175.0 760.0 NA 5.3% 0.23x NA




Select Recent Aerospace / Defense M&A, cont.(1) ($ in millions)



05/29/13 Winchester Electronics Continental Connector

Company

Manufactures ruggedized multi-pin connectors used in electronic

communications equipment, radar systems, missiles, space

instrumentation, and aircraft equipment

NA NA NA NA NA NA

05/28/13 Astronics Corporation PECO Inc. Designs and manufactures highly engineered commercial aerospace

interior components and systems for the aerospace industry

$ 136.0 $ 83.0 NA NA 1.64x NA

05/23/13 Air Comm Corporation Meggitt (Addison) Inc. Manufactures aircraft air conditioning, heating, and ventilation systems

for military and special mission aircraft

NA NA NA NA NA NA

05/16/13 Maz Aviation Consulting Gore Design

Completions

Designs and manufactures custom aircraft interiors for corporate

aircraft and provides maintenance support services

NA NA NA NA NA NA

05/15/13 TransDigm Group Arkwin Industries, Inc. Manufactures proprietary aerospace hydraulic and fuel system

components for commercial and military fixed wing and rotary aircraft

286.0 95.0 NA NA 3.01x NA

05/13/13 Mistral Detection O.D.F. Optronics Manufactures optical intelligence-gathering systems for defense, law

enforcement and security personnel

NA NA NA NA NA NA

05/10/13 a2e Venture Catalysts BHW (Components) Manufactures airframe components including leading and trailing

edges, structural ribs, fusealge sections, and instrument panels

NA NA NA NA NA NA

05/10/13 Seven Technologies Datong plc Manufactures covert intelligence gathering solutions for international

defense and law enforcement markets

6.8 15.6 $ 0.5 2.9% 0.44x 15.1x

05/10/13 Cobham plc Axell Wireless Limited Provides technologies and platforms in the areas of cellular, public

safety, broadcast, military communication, and air band communication

92.0 NA NA NA NA NA

05/07/13 Secure Communication

Systems, Inc.

Smart Electronics &

Assembly, Inc.

Provides electro-mechanical solutions for high-reliability applications in

defense, commercial aerospace, and industrial markets

NA 24.7 NA NA NA NA

05/06/13 Triumph Group Primus Composites Manufactures composite and metallic propulsion and structural

components for aerospace and defense applications

NA 55.0 NA NA NA NA

05/06/13 HEICO Corp. Reinhold Holdings Produces advanced custom composite components and complex

composite assemblies for commercial aviation, defense, and space

applications

130 NA NA NA NA NA

04/23/13 Honeywell International, Inc. RAE Systems Inc. Manufactures multi-sensor chemical and radiation detection monitors

and networks for hazardous material management, industrial safety, and

environmental remediation applications

340.0 107.0 26.2 24.4% 3.18x 13.0x

04/23/13 Safran SA Rolls-Royce RTM322

Program (50% stake)

Develops, manufactures, and markets two-shaft turbofan aircraft

engines

380.5 NA NA NA NA NA

04/23/13 System Studies and

Simulation, Inc.

Summit Aviation Provides aircraft maintenance, inspection, and bench repair services,

permit assistance, avionics repair and installation, sheet metal and

composite repair, aircraft pick up and delivery, and wash and detail

NA NA NA NA NA NA

04/22/13 TransDigm Group

Incorporated

Aerosonic Corp. Provides aircraft instrumentation including digital altimeters, airspeed

indicators, air data test sets, and other flight instruments

37.5 31.0 4.8 15.4% 1.21x 7.9x

04/18/13 Diversified Aero Services

Inc.

Aero Inventory (UK) Ltd Offers one of the world’s largest inventories of aircraft parts through a

fully functioning online sales platform, with over 200,000 SKUs

supporting all major commercial aircraft and engines

NA NA NA NA NA NA

04/17/13 Measurement Specialties,

Inc.

Spectrum Sensors and

Controls, Inc.

Designs and manufactures custom temperature probes, high reliability

encoders, and inertial sensors

51.4 26.0 8.0 30.8% 1.98x 6.4x

04/17/13 Bohemia Interactive

Simulations

TerraSim, Inc. Provides automated terrain generation software for use in interactive

simulation systems for defense, emergency, and mission-critical

customers

NA NA NA NA NA NA

04/16/13 Merex Incorporated ALCO Services, Inc.

(Aircraft Logistic-

support Company)

Provides MRO services for auxiliary power units and engine driven

compressors, as well as a variety of other critical components for

hydraulic, pneumatic, fuel, and electrical systems

NA NA NA NA NA NA

04/16/13 Prospect Partners Velocity Aerospace

Group

Provides MRO services for commercial, corporate, regional, and

helicopter airline carriers through repair stations in Florida and

California

NA NA NA NA NA NA

04/08/13 Altran Technologies SA AirCaD SAS Provides engineering, modification, mechanical completion, and

simulation and structural analysis for aircraft interiors, cabins, avionics,

and other components

NA NA NA NA NA NA

04/04/13 Turkish Airlines (THY) MNG Technic Offers base maintenance services, such as scheduled or non-

scheduled periodic maintenance, light and heavy overhauls on

airframes, and component accomplishment

NA NA NA NA NA NA

04/03/13 Horst Engineering &

Manufacturing Co.

Sterling Machine

Company

Manufactures jet engine components, specializing in close tolerance,

high precision components from high strength metals and polymers

NA NA NA NA NA NA




Select Recent Government Services M&A(1) ($ in millions)



07/31/13 Accenture plc ASM Research, Inc. Provides information technology, information assurance, and

professional services to the U.S. Federal health and defense

communities

NA NA NA NA NA NA

07/29/13 Integrated Mission Solutions,

LLC

Michael Baker

Corporation

Provides engineering services for public and private sector clients

worldwide through its Federal and Transportation divisions

$ 327.6 $ 585.7 $ 26.3 4.5% 0.56x 12.4x

07/08/13 Social & Scientific Systems,

Inc.

SRA, Health Sciences

Research Group

Provides design, execution, and analysis of public health studies,

survey research and evaluation, and statistics and bioinformatics for

government agencies

NA NA NA NA NA NA

07/02/13 Caltius Capital Management SM&A Provides competition management services through proprietary

proposal management strategies and processes for defense, homeland

security, and aerospace customers

NA NA NA NA NA NA

06/19/13 Subsystem Technologies,

Inc.

Alapko, Incorporated Provides lifecycle development and support services for database

management, business intelligence, and business process re-

engineering for the Intelligence Community and DoD

NA NA NA NA NA NA

06/04/13 Information Innovators, Inc. GoldBot Consulting, Inc. Provides system engineering, software development, and intelligence

analysis services to DoD customers; specializes in knowledge

discovery and geospatial information systems

NA NA NA NA NA NA

06/03/13 Quantum Research

International

J2 Technologies, Inc. Provides aviation and missile defense architecture, defense technology

assessments, and software and prototype development support for the

DoD

NA NA NA NA NA NA

05/31/13 Argol America, Inc. Eagle Support Services

Corporation

Provides training services in the areas of military occupational skill

training, platform instruction, new equipment training, and situational

training scenarios

NA NA NA NA NA NA

05/30/13 Deloitte & Touche LLP Vigilant, LLC Provides managed threat intelligence and IT risk consulting services,

focusing on security and IT risk program, planning, and security

monitoring lifecycle services

NA NA NA NA NA NA

05/15/13 The SI Organization, Inc. Applied

Communications

Sciences

Provides communications research, consulting, and engineering

services in the areas of cybersecurity, wireless and mobile applications,

and information analytics to governments worldwide

NA NA NA NA NA NA

05/07/13 Haystax Technology, Inc. FlexPoint Technology,

LLC

Provides cloud computing and enterprise content management services

to government customers with demanding security requirements

NA NA NA NA NA NA

04/22/13 Birch Hill Equity Partners

Management Inc.

Softchoice Corporation Provides IT infrastructure solutions to enterprise, government, and small

business customers in the U.S. and Canada

334.8 1,065.6 52.6 4.9% 0.31x 6.4x

04/09/13 Braxton Technologies, Inc. Net-Centric Design

Professionals LLC

Provides engineering, systems integration, and technology development

services to develop, modernize, and maintain ground stations, data

centers, and computer systems

NA 20.0 NA NA NA NA

04/02/13 EOIR Technologies, Inc. Viecore Federal

Systems Division, Inc.

Provides decision support technologies and data management systems

for the U.S. military and homeland security communities

NA NA NA NA NA NA

03/27/13 True North Logistics RAMTECH Support

Services, Inc.

Provides operations and maintenance, systems engineering, and

technical assistance, primarily to the Department of Defense and other

federal agencies

NA NA NA NA NA NA

03/14/13 ORBCOMM Inc. System Planning

Corporation,

GlobalTrakDivision

Provides real-time situational awareness and intelligence for military,

government, and commercial customers

NA NA NA NA NA NA

03/08/13 The Parsons Corporation First Support Services,

Inc.

Provides operations and maintenance services, primarily facility

support, for the U.S. government, Department of Defense, state and

local government agencies, and commercial businesses

NA 50.0 NA NA NA NA

03/04/13 MacAulay-Brown, Inc. Luna Innovations,

Secure Computing and

Comm. Group

Provides technical services for electronic components and methods with

a focus on critical U.S. military and national security applications

6.7 8.0 NA NA 0.84x NA

02/15/13 Ball Aerospace &

Technologies Corp.

OGSystems TASER

Business Unit

Provides high-end mission analysis, systems and software engineering,

integration, and IT services for the National Geospatial-Intelligence

Agency

NA NA NA NA NA NA

01/30/13 DC Capital Partners, LLC Computer Security

Solutions, Inc.

Provides technology solutions for the Intelligence Community, including

PC, notebook, and videoconferencing security solutions, and secure

modifications to COTS products

NA NA NA NA NA NA

01/23/13 Network Designs, Inc. BitSec Global Forensics Provides digital forensics, electronic discovery, data breach

investigations, and training for federal and state investigative agencies,

law firms, and corporations

NA NA NA NA NA NA

01/22/13 Projility, Inc. SharkPro Software

Corporation

Provides integrated work management solutions for commercial and

government customers by building complementary tools for Microsoft

Project Server

NA NA NA NA NA NA

01/17/13 First Advantage Corporation LexisNexis Risk Solut.,

Employment and

Resident Screening

Provides talent acquisition solutions with a focus on technology-enabled

background screening solutions and services

NA NA NA NA NA NA

01/09/13 Behrman Capital Tresys Technologies

LLC

Provides content filtering, file sanitization, information sharing, and

cross domain solutions for DoD and commercial customers

NA NA NA NA NA NA


13


Select Recent KippsDeSanto & Co. Advised Transactions

Recognized in Washington Technology’s “Who Made 2012’s Biggest Deals?” Report


`

About KippsDeSanto & Co.

KippsDeSanto is an investment banking firm focused on delivering M&A and financing expertise. Our solutions are focused on the technology sectors we know – Aerospace / Defense and Government Services. We are recognized for our depth of industry experience, knowledge of sector-specific transaction drivers, and long-standing relationships with industry participants.

We welcome the opportunity to have a more detailed discussion of developments in our focus industries. For more information, please contact us:

Robert D. Kipps Managing Director [email protected] Marc B. Marlin Director [email protected] Karl M. Schmidt Director [email protected] Toby Albright Vice President [email protected] Robert G. Dowling Associate [email protected] Christos G. Tsentas Associate [email protected]

Kevin P. DeSanto Managing Director [email protected] Michael J. Misantone Director [email protected] Jon Yim Director [email protected] Aaron M. Sharp Vice President [email protected] Kenneth L. Morris Associate [email protected] Brian T. Tunney Associate [email protected]

Connect with KippsDeSanto:

The information and opinions in this newsletter were prepared by KippsDeSanto & Co. and the information herein is believed to be reliable and has been obtained from and based upon public sources believed to be reliable. KippsDeSanto & Co. makes no representation as to the accuracy or completeness of such information. Opinions, estimates, and analyses in this newsletter constitute the current judgment of the author as of the date of this newsletter. They do not necessarily reflect the opinions of KippsDeSanto & Co. and are subject to change without notice. This newsletter is meant to impart general knowledge about a sector or industry and is not expected to provide reasonably sufficient information upon which to make any investment decisions. KippsDeSanto & Co. is not affiliated with any of the companies identified in this newsletter. Unless otherwise described, the companies identified are also not affiliated with one another.

8000 Towers Crescent Drive Suite 1200

Tysons Corner, Virginia 22182 703.442.1400

www.kippsdesanto.com


http://www.linkedin.com/company/1717017

http://www.facebook.com/pages/KippsDeSanto-Company/144516898946294

http://twitter.com/kippsdesanto

http://www.kippsdesanto.com/feed/

summer 2013 aerospace / defense and government services · government strategy to reduce...

Documents