Time is running out for 27 per cent of the aviation equipment industry

Citation

(2001), "Time is running out for 27 per cent of the aviation equipment industry", Aircraft Engineering and Aerospace Technology, Vol. 73 No. 2. https://doi.org/10.1108/aeat.2001.12773baf.005

Time is running out for 27 per cent of the aviation equipment industry

Time is running out for 27 per cent of the aviation equipment industry

Keywords Plimsoll, United Kingdom, Aerospace industry

Over a quarter of all UK aviation equipment companies will not see out 2001 in their present shape, according to Plimsoll Publishing. Identified in their new First Edition 2001, Plimsoll Portfolio Analysis are predicting in 2001 that these losers will disappear, be taken over or be forced to change to stay in the market.

The analysis, which included 816 companies in total, predicts that the winners and the chancers, who are capturing market and profits with a combined sales growth average of over 22.5 per cent, are pushing the losers out of the market. As they try to maintain sales and profit targets, acquisition activity could intensify in 2001.

The First Edition 2001, describes four types of company strategy. The Winners have low borrowings (debt) as a percentage of sales and have high sales growth. The Chancers have high borrowings and high sales growth. The Sleepers have low borrowings and low sales growth. The Losers have high borrowings and are growing below average.

For these 120 Losers time is running out. Their level of debt is high at 43.1 per cent of sales on average. A more sensible average would have been about 18.3 per cent. These companies have lost market share and sales growth average for the latest period is showing an average decline of 7.5 per cent. Their margins are slim at 2.2 per cent on average and almost 38 per cent of them are loss making. They have borrowed to stay in the market, but how long can this strategy be maintained?

The publication contains the most up-to-date analysis of 816 UK aviation equipment companies covering their latest four years of trading. Presented in a one-page per company format, setting into context the strengths and weaknesses of each company could not be simpler. In addition, it is a great tool for searching acquisition prospects.

The First Edition 2001 Plimsoll Portfolio Analysis: Aviation Equipment costs £305. Readers of this publication can obtain a 5 per cent discount by mentioning this article upon ordering.

Further details are available from Plimsoll Publishing Ltd. Tel: +44 (0)1642 257800; Fax: +44 (0)257806; E-mail: plimsoll@dial.pipex.com Website: www.plimsoll.co.uk