Aircraft Q1’06

Total Aircraft sales of $127 million were up a remarkable 20% in the quarter. The sales increase came in both the military and the commercial sides of our business.

Military aircraft sales of $80 million were up 11% or almost $8 million. The biggest increase was on the F-35, the Joint Strike Fighter Program. Sales of almost $19 million were up $5.3 million from a year ago. You’ll remember that our F-35 sales include revenues from work done at our Company, and also work done in our partner companies, Parker, Hamilton Sundstrand and Curtiss-Wright. That work is invoiced to us and becomes part of our revenue as we, in turn, invoice to Lockheed Martin. Most of the revenue increase in the first quarter was the result of increased work done at Moog. A year ago, in the first quarter, we did $5.6 million worth of work at Moog, in this year’s first quarter, over $10 million. The first flight of the F-35 is scheduled for this summer. We and our partners are engaged in the mad dash to get all the hardware, software and test equipment delivered and tested in preparation for the first flight.

The next biggest increase in the military aircraft product line was in the aftermarket. Revenues this quarter were $26.4 million, up over $4 million from a year ago. We appear to be on track to make our $105 million aftermarket forecast for the year, which will be a $10 million increase from FY’05.

There were two other programs that saw big swings in the first quarter. Our F-15 revenues were up over $3 million to a total of $8.1 million. This is the continuation of heavy shipments of F-15 parts and subassemblies to the Japanese Defense Agency. On the other hand, in last year’s first quarter we had revenues of over $5 million on the Indian Light Combat Aircraft, and in this quarter sales were down to a more normal level of $1.8 million.

For the year, we had forecasted total military aircraft sales of $297 million. Given the first quarter activity level on the F-35, we are revising that estimate to about $301 million.

Our Commercial aircraft forecast for ’06 was $181 million, a 17% increase over last year. In the first quarter, we got off to a great start. Revenues of over $47 million were up 39% from the comparable quarter last year.

The biggest dollar increase was in the aftermarket. Sales of almost $20 million were up $6.6 million or 49% from the first quarter of last year. It appears that there has been a general improvement in the aftermarket across all aircraft models and all regions. We saw increasing sales levels in the quarter in every one of our major accounts. On the other hand, sales in the commercial aftermarket are fairly volatile so we’re not yet ready to extrapolate the first quarter’s results for the rest of the year.

Our OEM sales to Boeing were up 28% to over $11 million. Airbus sales were up 12% to $4.5 million.

Our sales to the makers of business jets were up 54% to $7.7 million. The major increases were on the Challenger 300, Gulfstream 450, and the Hawker Horizon, which is now the Hawker 4000.