OC A&D Forum Ducommuns continued drive to expand organically and - - PowerPoint PPT Presentation

SLIDE 1

Ducommun Overview OC A&D Forum

Ducommun’s continued drive to expand organically and through acquisitions, adding capabilities and value including assembly to its product, process and service offering April 5, 2012

SLIDE 2

Today’s presentation will focus on: 1) Ducommun’s strategic decision to move up the value chain with design and higher level assemblies making the transition to being a leading Tier2 2) Ducommun’s drive to broaden our product, process and service offering to add value and capabilities, including successfully integrating strategic acquisitions into "One Ducommun”. 3) Where we are on that journey to being a leading Tier 2 “Best Value” Supplier.

2

Key Overview Objectives

SLIDE 3

3

The Ducommun Team Provides Total Product Solutions

Blackhawk

Design – Development -Fabrication - Integration - Test - Production

Tony Reardon, President & CEO

Ducommun LaBarge Technologies Ducommun Miltec Ducommun AeroStructures

• Designs, engineers and manufactures aerostructure and electromechanical components and subassemblies
• Provides engineering, technical and program management services principally for the global

aerospace industry

• 2012 Estimated Sales ~$785 million
• 3400+ employees in the U.S. , Mexico and Thailand
• Founded in 1849
• Headquartered in Carson, CA

SLIDE 4

Vision Statement and Core Values

Ducommun, a global partner

• Growing profitably to $1 Billion
• Powered by the development and full commitment of our

people

• Driving innovative solutions and services to the aerospace,

defense and diverse technology-driven markets Core Values:

• Honesty
• Professionalism
• Customer Orientation
• Continuous Improvement
• Teamwork

4 4

SLIDE 5

5

Major Customers

5

SLIDE 6

15% 10% 6% 4% 4% US Government 3% Other 58%

Ducommun Inc.

2012 Sales Est: $785 million

Ducommun Inc. Pro Forma Revenue

1 1 1

1.

Designs, engineers and manufactures aerostructure and electromechanical components and subassemblies

2.

Expertise in high-mix, low-volume manufacture of custom, complex, high- reliability, mission-critical products

3.

Broad range of capabilities in electronics and interconnects to electromechanical and high-end final assemblies

4.

Extensive value-added services, such as engineering and design, program management and aftermarket support

5.

2012 Estimated sales of $785 million

6.

Growth-oriented

Ducommun Incorporated

6

SLIDE 7

7

Ducommun’s End Use Markets Offer Growth Opportunities

(Pro Forma Combined for the Twelve Months Ended 12/31/11)

Defense Technologies (32% of Sales) Defense Structures (18% of Sales) Medical (6% of LTM Sales) Natural Resources (9% of Sales)

Industrial

(10% of Sales)

 Missile systems  Radar systems  Aircraft applications  Shipboard systems  Rotor blade assemblies  Glass container electronic manufacturing systems  Electronic test equipment  Semiconductor capital equipment  Wind power generation systems  Oilfield services equipment  Mine automation  Agricultural applications  Surgical systems  Patient monitoring and therapy devices  Respiratory care devices  Biodecontamination equipment  Flight control assemblies  Rotor blade assemblies  Fuselage skins  Leading edges  Engine ducts

Commercial (25% of Sales)

SLIDE 8

8 Military & Space - Structures 22% Military & Space - Technologies 34% Commercial Aerospace 30% Industrial 4% Natural Resources 6% Medical/Other 4% Military & Space - Structures 18% Military & Space - Technologies 32% Commercial Aerospace 25% Industrial 10% Natural Resources 9% Medical/Other 6%

Highly Diversified Portfolio in Low Volume, High Mix & High Margin Businesses

Diversified End Markets and Platforms with Strong Industry Fundamentals

$744 Million 2011 Pro forma Sales $636 Million Backlog as

• f 12/31/11

Annual Expected Growth Rate Commercial Aerospace 8% - 10% Military & Space - Technologies 3% - 5% Military & Space - Structures (3%) - 2% Natural Resources 3% - 5% Industrial 3% - 5% Medical & Other 4% - 6% Weighted Average Growth Rate 3% - 6%

SLIDE 9

Manufacture subassemblies Final assembly, finish and delivery

OEM

Components or detailed parts

Tier III Tier II Tier I

Manufacture aircraft sections and purchase assemblies

• Market consolidation at all levels of the channel to market.

 The result will be fewer stronger players at each level.

• Continued OEM outsourcing / OEM move to reduce capital.
• Tier I and Tier II levels must deploy more capital.
• More engineering and integration required at both Tier I and Tier II levels.
• Tier III players must move up the value chain or find proprietary niche to survive.

DCO must move up the value chain with design and higher level assemblies

9

Ducommun Goal: Become a Leading Tier 2 Player

SLIDE 10

10

The “One Ducommun” Platform Forms the Basis for Sustainable Profitable Growth

• Training and development
• Honesty, professionalism,

customer orientation, continuous improvement, team work

• Shared services (HR, Supply

Chain, Accounting, IT)

• Lean Six Sigma
• Broader capabilities
• Production efficiencies
• Capacity
• Offshore expansion
• Supply chain management

+ =

Organizational Development Operational Excellence

= =

Sustained Profitable Growth

• Increase value-added
• fferings
• Increase operating margins
• Increase profitability of

incremental revenue

• Increase return on capital
• Increase shareholder value

OD + OE = PG

SLIDE 11

11

Monitor – 10 Types of Innovation

Daryl G. Pelc - Vice President Engineering & Technology Boeing Phantom Works’ OC A&D February presentation reference to Monitor’s “10 Types of Innovation” really resonated, and supports DCO’s Strategy perfectly.

• 1. Focus investment on the business model,

human capital, core competencies.

• 2. Drive 100% Quality and Delivery with

monotonous regularity.

• 3. Become recognized as a “Best Value Supplier”

OD + OE = PG

SLIDE 12

12

AOP

Vince Greco IPT - Stretch West Metric/TTI YTD Perf. JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2006 Baseline Plan 97.12% 97.22% 97.32% 97.42% 97.52% 97.62% Actual 96.72 96.99 96.63 97.12% 97.05% Plan 18 36 54 72 90 108 126 144 162 180 198 216 Actual 30 54 88 157 202 259 275 324 Plan 19 15 12 12 12 12 11 10 9 8 8 8 Actual 32 24 8 8 20 21 47 28 Plan 18,874 37,748 56,622 75,496 94,370 113,244 132,118 150,992 169,866 188,740 207,614 226,488 Actual 26,444 77,142 110,580 145,454 216,227 240,377 251,959 308,959 Plan 165 132 106 63 38 23 Actual 160 225 87 71 22 37 25 96 Plan 13 10 8 8 8 8 7 7 6 5 5 5 Actual 15 13 6 4.5 7.5 3 5 5 Plan 170% 170% 170% 170% 170% 170% 170% 170% 170% 170% 170% 170% Actual 146% 168% 147% 165% 161% 164% 167% 169% Plan 10.5 10.0 10.0 9.5 9.5 9.0 Actual 10.5 10.2 Plan 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% Actual 122 74 Plan Collect Data 103,571 86,093 84,015 No Data No Data No Data Actual 130,986 104,547 117,238 100% - 98% 97.9% - 96% 95.9% - IPT/Bus Mgmt 10/1/2007 IPT/Valencia 10/1/2007 IPT 8/30/2007 IPT 11/30/2007 Work with Business Mgmt to expedite customer disposition Six Sigma Teams are continuing to work on the 3971 family and the 853/854's. We have made great progress with contour issues and are now eliminating periodic orange peel. PD Hours - These 96 hours are attributed to late material arriving and being released past due to the presses (including Eclipse, which will be rescheduled out again). Scrap - Scrap went up in August. Over 50% of the scrap was attributed to old (pre-cube) Eclipse parts that had not been

• dispositioned. Much of the remaining scrap was the Chinook 3971 family

MRR Cycle Time - MRR cycle time was improved by about 43% - old tags that are driving MRR cycle time are submitted and awaiting customer response MRR Volume - There were a total of 59 pcs put on MRR in August. 71% were either Eclipse parts or 3971's. With respect to Eclipse, the parts were either 663/664's which we still cannot stretch on the Erco or 853's and 854's for wrinkles which are better and being benched into conformity. With respect to the 3971's, we are still working with Boeing to improve our yield and perhaps revise the inspection methodology. Collect Data Baselines Established Collect Data Baselines Established Metric Definition < 7 days in all w/c's, but "Submitted" w/c 15% Reduction from 2006 baseline (measured in $$) TBD 15% Annual Increase WIP / Output / CT Scrap (Cum) MFG EFF Zero by end of 2007 TBD 1st Pass Yield PD Hours by Customer Days in W/C MRR Volume (Cum) No Data 20 254 15% reduction per month (measured in pcs) MRR CT (Days) Less than 5 days No Data 14 174 260,461 Reduce WIP by XX % TBD No Data Collect Data Baselines Established Reduce O/H Exp by XX % Commit Date Issue Countermeasure Accountable No Data TBD 3 Kaizens completed in IPT West YTD Working on "Late to Release" visibility and related PO/Sales Order administration and communication w/customer Six Sigma Teams are working on both the Eclipse and the Chinook challenges and making significant progress

Using Hoshin Planning – Toyota Production System Goal Deployment Policy (GDP) X Matrix Process

LRP Site Goals

Define performance for each Integrated Program or Process Team (IPT) Use CI Calendar to drive focus & commitment to Kaizen Events / Lean Six Sigma Projects to support TTIs

… GDP links goals from LRP to individual performance plans

Review each IPT’s Target to Improve (TTI) at Monthly

• Mgmt. Meeting with IPT

Leaders and Staff

12

SLIDE 13

Sources of Variation for y = Contour (Wrinkles)

C N X Measurement C N X Method C N X Machine C N X Manpower C N X Materials C N X Environment Variable 1 X Jaw Pressure X Stretching Method X Press Type C Training X Temper N Ambient Temp. Variable 2 C Center Die-Table X Lube X Press Tonage C Procedures X Thickness N Weather Variable 3 C Center Material-Die X Saddles X Forming Die Contour C Standard Work N Size (84" X 100") C Visibility Variable 4 X Table Speed X Number of Pulls N Chemistry Variable 5 X Jaw Angles X Heat Treating N Other Mechanical Properties Variable 6 X Strain X Annealing C Alloy Type Variable 7 X Percent Stretching X Raw Material Shape Variable 8 C Distortion Variable 9 Variable 10 Variable 11 Variable 12 Measurement Method Machine Manpower Materials Environment Contour (Wrinkles) (X) Jaw Angles (X) Strain (X) Table Speed (C) Center Material- Die (C) Center Die- Table (X) Jaw Pressure (X) Heat Treating (X) Annealing (X) Number of Pulls (X) Saddles (X) Lube (X) Stretching (X) Percent Stretching (X) Forming Die Contour (X) Press Tonnage (X) Press Type (C) Procedures (C) Training (C) Standard Work (X) Thickness (X) Temper (N) Size (84" X 100") (N) Chemistry (N) Other Mechanical (N) Alloy Type (C) Distortion (N) Raw Material Shape (N) Weather (N) Ambient Temp. (C) Visibility 78 76 74 72 70 68 Median Mean 75.0 74.8 74.6 74.4 74.2 74.0 A nderson-Darling Normality Test V ariance 3.916 Skewness 0.105962 Kurtosis

• 0.434051

N 174 Minimum 68.000 A -Squared 1st Q uartile 73.000 Median 74.000 3rd Q uartile 76.000 Maximum 79.000 95% C onfidence Interv al for Mean 74.198 3.20 74.790 95% C onfidence Interv al for Median 74.000 75.000 95% C onfidence Interv al for StDev 1.791 2.212 P-V alue < 0.005 Mean 74.494 StDev 1.979 95% Confidence Intervals Summary for No HT Max

Lean Six Sigma Project Examples

L100 Worksheet - Sigma Scorecard for Attributes Confidence Level 95% Alpha = 5% One Defect per Opportunity

• n DPMO
• n Zlt
• n Yield

MRR DATE MRR# DEFECT Work Order Scrap Ord Qty OP TOP DPU DPO DPMO Lower Upper Zlt Lower Upper Yield Lower Upper 10/4/2005 A00002665 A320 AMA009386 1 1 1 1 1.000 1.000 1,000,000 25,000 #NUM! #NUM! #NUM! 1.96 0.0% #NUM! 97.5% 1/9/2006 A00002692 A290 AMA011802 1 1 1 1 1.000 1.000 1,000,000 25,000 #NUM! #NUM! #NUM! 1.96 0.0% #NUM! 97.5% 1/19/2006 A00002768 A350 AMA012040 1 1 1 1 1.000 1.000 1,000,000 25,000 #NUM! #NUM! #NUM! 1.96 0.0% #NUM! 97.5% 2/17/2006 A00002948 A290 AMA012661 2 2 1 2 1.000 1.000 1,000,000 158,114 #NUM! #NUM! #NUM! 1.00 0.0% #NUM! 84.2% 3/15/2006 A00002838 A150 AMA012664 1 2 1 2 0.500 0.500 500,000 12,579 987,421 0.00

• 2.24

2.24 50.0% 1.3% 98.7% 6/21/2006 A00003103 A350 AMA014838 2 3 1 3 0.667 0.667 666,667 94,299 991,596

• 0.43
• 2.39

1.31 33.3% 0.8% 90.6% 6/21/2006 A00003102 A410 AMA014905 2 3 1 3 0.667 0.667 666,667 94,299 991,596

• 0.43
• 2.39

1.31 33.3% 0.8% 90.6% 7/28/2006 A00003206 A150 AMA014925 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 7/31/2006 A00003212 A360 AMA014925 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 7/28/2006 A00003203 A150 AMA014934 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 7/28/2006 A00003205 A150 AMA014943 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 7/28/2006 A00003202 A150 AMA014944 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 7/28/2006 A00003204 A150 AMA014952 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 9/12/2006 A00003400 A350 AMA015327 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 9/12/2006 A00003567 A150 AMA015442 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 9/12/2006 A00003333 A350 AMA015556 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 9/12/2006 A00003331 A350 AMA015854 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 9/22/2006 A00003399 A350 AMA016002 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 9/22/2006 A00003612 A410 AMA016003 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 9/22/2006 A00003398 A150 AMA016011 3 3 1 3 1.000 1.000 1,000,000 292,402 #NUM! #NUM! #NUM! 0.55 0.0% #NUM! 70.8% 10/12/2006 A00003597 A150 AMA016012 2 3 1 3 0.667 0.667 666,667 94,299 991,596

• 0.43
• 2.39

1.31 33.3% 0.8% 90.6% 10/24/2006 A00003463 A150 AMA016147 2 3 1 3 0.667 0.667 666,667 94,299 991,596

• 0.43
• 2.39

1.31 33.3% 0.8% 90.6% 11/20/2006 A00003628 A150 AMA016148 2 3 1 3 0.667 0.667 666,667 94,299 991,596

• 0.43
• 2.39

1.31 33.3% 0.8% 90.6% 11/29/2006 A00003491 A150 AMA016265 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 11/30/2006 A00003627 A150 AMA016266 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 12/5/2006 A00003332 A350 AMA016499 2 2 1 2 1.000 1.000 1,000,000 158,114 #NUM! #NUM! #NUM! 1.00 0.0% #NUM! 84.2% 12/5/2006 A00003334 A350 AMA017276 1 1 1 1 1.000 1.000 1,000,000 25,000 #NUM! #NUM! #NUM! 1.96 0.0% #NUM! 97.5% 12/6/2006 A00003610 A150 AMA017626 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 12/7/2006 A00003617 A265 AMA017776 2 3 1 3 0.667 0.667 666,667 94,299 991,596

• 0.43
• 2.39

1.31 33.3% 0.8% 90.6% 12/8/2006 A00003589 A150 AMA017825 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 12/11/2006 A00003638 A410 AMA017887 1 3 1 3 0.333 0.333 333,333 8,404 905,701 0.43

• 1.31

2.39 66.7% 9.4% 99.2% 12/11/2006 A00003056 A340 AMR001547 1 2 1 2 0.500 0.500 500,000 12,579 987,421 0.00

• 2.24

2.24 50.0% 1.3% 98.7% Totals 56 84 1 84 0.667 0.667 666,667 555382 765815 -0.43 -0.73 -0.14 33.3% 23.4% 44.5%

Current DPMO 666,667 Sigma Level

• .73

First Time Yield 23.4%

Current Performance Cause and Effect – Fishbone Analysis Finite Element Analysis

Hot Form Inspect for Damage Pre-Form Brake - 3/16" Radius, 88 deg Deburr / Cut Edges Clean & Flash Etch OS-200-9 #28 Apply (1) Part Everlube T-50 to (3) Parts of thinned Turco Pretreat Supplied Material

• 1. Grain direction of first bend
• 2. Radius & degree of pre-form
• 3. lubricant coating of the part

prior to processing

• 4. Deburr & trim operation
• 5. AR - Material
• 6. Thickness of material

Form Tooling

• 1. Material Growth
• 2. Contour
• 3. Fit up
• 4. Cleanliness
• 5. Straightness
• 6. Joggle location
• 7. Maintenance procedures (die

& bladder). Process

• 1. Alignment
• 2. Set Temperature
• 3. Pre-Heat Time
• 4. Soak Time
• 5. Stop length wise
• 6. Part handling
• 7. Equipment operating sequence
• 8. Part removal and cooling

method

• 9. Die uniformity

Hot Form Instructions

• 1. Load part blank onto preheated die
• 2. Set pressure relief valve for outer bag at 20 PSI
• 3. Set forming pressure at 10 PSI
• 4. Heat to 1200-1350 Deg F and stabalize (5) die

Thermocouples

• 5. Hold 1.75-2 hours

Note: Bleed off pressure from outer bag and pressure pillowprior to opening press

• 6. Remove from die and cool to room temperature

Inspection Prior to Chem Mill (.080" gap max). In Clean & Descale Map Thickness Chem Mill to final

• thickness. .018-

.024

Position 1 Temp: Cold Die: Open Pressure: -0 psi Position 2 Temp: 1200-1350F Die: Partially Closed Pressure: -0 psi Position 3 Temp: 1200-1350F Die: Fully Closed Pressure: -0 psi Position 4 Temp: 1200-1350F Die: Fully Closed Pressure: -18-20 psi

Operating Parameters Process Map

Die Temperature Uniformity 1000 1100 1200 1300 1400 1500 1600 1 2 3 4 5 6 7 8 9 10 11 12 Location Temperature Min Goal Die 1 control 1 Die 2 Control 2 Die 3 Control 3 Die 4 Control 4

Thermal Analysis

Condition, 4. Bent Condition 1 Bladder Material Grade of Material being used Heat expansion Inside Bladder Skin right material Material thickness Thick Material Thickness variation Thin Material Too Thick Too Thick Too Thin Too Thin Type of lube being used Air pressure from bladder Bladder & die mismatch Cooking time -run time Joggle block Location of part in die Method of loading/unloading parts No TCs on Bladder Number of blades before replacing bladder Righ Air pressure on bladder Right thickness on inside bladder skin Run Time not well defined Runing time Shims Temperature of die during running of part Time run Welding of bladder inner skin Handling of parts Improper Training inexperianced operators Lack of scientific knowledge on process variables Not consistancy from operator to operator Not observing temperature while parts are running Not operating controls correctly Not operating electric control panels appropriately Operator experience Operator handling of blades Unloading of blades Weather conditions Foreign elements in air Electricity fluctuation Inability to measure press position Not using timers to measure run time TC wires not working correctly measuring too hot/cold Electricity not uniform throughout the parts Pressure variability Temperature Variability Bladder air Pressure Bladder and Die interferance Bladder leaking air pressure Bladder thickness - inner skin Bladder too wide in certain areas Die bent end to end Die twisted Expansion of inter skin-bladder Groove on ceramic blocks Index locator or die & bladder needed ? Inter-skin of bladder waviness Joggle block mis-located in bladder Lack of alignment of bottom base Lack of press squareness between bottom & top Lube built up on bladder Not repeatable closing of press Parts not ironining out joggle block area (too wide) Press has not foundation - not isolated Press not aligned (our of alignment) Press out of alignment Presses not able to hold temperature Repeatability of press Shape of pre-form blanks Twisted Die Instructions:

• 1. Print this file
• 2. Circle top 5-8 causes you

know are major contributors to the defects (See example 1 attached)

• 3. Return the form with your

circled causes to Luis Olmedo no later than Monday 7/31. Note: some causes are repeated. Hot forming process currently experiencing forming defects: Wrinkles, Bent, Twisted, and Convex Condition Materials Environment Methods Man (people) Measure Machine Equipment

Fishbone

Press #1 - Die Temperature Uniformity 800 900 1000 1100 1200 1300 1400 1500 1600 1 2 3 4 5 6 7 8 9 10 11 12 Thermcouple Location Temperature (deg F) Min Goal Set Temp 1 loaded Start of soak Bladder Pressurized Prior to Unloading

Die Temperature Uniformity - Test

Full tool box of lean principles & 6σ methodologies – Using the right tool for the job

13

SLIDE 14

14

Ducommun: History of Successful Acquisitions

 May 2001: Acquisition of Composite Structures  Founded in 1849  August 2003: Acquisition of DBP Microwave  May 2006: Acquisition of WiseWave Technologies  December 2008: Acquisition of DynaBil Industries  January 2006: Acquisition of Miltec Corporation  June 2011: Acquisition of LaBarge  September 2006: Acquisition of CMP Display Systems

1849 2001 2003 2005 2006 2007 2011 2008 1946

 Went public in 1946

Ducommun has a history of successful integration and deleveraging post acquisition

SLIDE 15

15

Ducommun’s Facilities Locations

Ducommun AeroStructures (DAS) Ducommun LaBarge Technologies (DLT) Miltec

Thailand

Primarily US-Based with Access to Low-Cost Domiciles

Ducommun Headquarters

SLIDE 16

16

Ducommun LaBarge Technologies (DLT)

Ducommun LaBarge Technologies (61% of 2011 Pro forma Sales) (1)

DLT designs, engineers and manufactures products used in worldwide technology-driven markets, including aerospace and defense, industrial, natural resources and medical.

Product Offerings

• Hardware and software design,

development and testing

• Cable assemblies, wiring

harnesses and interconnect systems

• PCB assemblies and miniaturized

hybrid circuits

• Complex electro-mechanical

assemblies

• Electrical & mechanical design

and manufacturing capabilities – Integrated cockpit control assemblies – Illuminated panels, advanced microwave switches and high performance motors and resolvers

• Radar sensors technology

Electronics Assemblies Radar Rack Manufacturing Electrical Harnesses Microwave Products

(1) as of 12/31/11

DLT has operations in 11 states and Thailand, internationally

Broad Based Specialized Capabilities

Interconnect Systems Printed Circuit Card Assemblies Higher-Level Assemblies Systems Integration

SLIDE 17

• Originally

Supplied Sensor

• Lens – current supplier shipped to DTT
• Horn – new supplier shipped to DTT
• CCA Card – current supplier shipped to DTT
• End Cap and Housing - new supplier shipped to DTT
• Cable Assembly – DTT Supplied

Voice of Customer

• Weak water resistance
• Metal housing heavy
• Further cost reduction
• Want to outsource some assembly work

Design Evolution

Adding Value through Design, Engineering, SCM and Manufacturing Services

17

SLIDE 18

18

Ducommun AeroStructures (DAS)

Ducommun AeroStructures (39% of 2011 Pro forma Sales)

Ducommun AeroStructures designs, engineers and manufactures large, complex contoured aerostructure components / assemblies and is a US non-OEM supplier of composite and metal bonded structures / assemblies.

Product Offering

Military Fixed Wing Aircraft

• Fuselage skin panels & assemblies
• Flight Control Surface assemblies
• Various door panels
• Leading edges

Military Rotary Wing Aircraft

• Main rotor blade assemblies
• Tail rotor blade assemblies
• Leading edges

Commercial Aircraft

• Fuselage skin panels & assemblies
• Composite winglets
• Flight Control Surface assemblies
• Leading edges
• Engine ducts

Composite Winglets Fuselage Skins & Assemblies Helicopter Firewall Assemblies Flight Control Surface Assemblies

(1) as of 12/31/11

DAS has manufacturing facilities in California, New York and Kansas

(1)

SLIDE 19

19

• Stretch, brake & roll forming
• Hot press
• Tooling design & fabrication
• Major assemblies

Metal Forming & Assembly

• Low Cost Off Shore
• Metal bond final insp
• Assembly & Paint

Guaymas Gardena, CA

• Composite & Metal Bond Assemblies
• Machining
• Chemical processing & Paint
• Rotary wing blades

Composite & Metal Bond

• Ti SPF & Hot Forming
• Ti Assemblies
• Chem milling
• Processing & Paint

Titanium Forming & Assembly Parsons, KS

• Precision Sheetmetal

Components and Assemblies

• Ti & Alum Hot Forming
• Finishing
• Brake, Roll, Hydro and

Stretch Form

Titanium & Aluminum Forming & Assembly Albany, NY Orange & El Mirage

• Chemical milling
• Machining
• Metal forming
• Sub-assemblies
• Engine ducts

Guaymas, MX Monrovia, CA El Mirage, CA Orange, CA

DAS Overview

DAS has 7 operations in 3 states and Mexico, internationally

SLIDE 20

Ducommun’s Miltec Corporation

Ducommun Miltec

Miltec Corporation, a wholly owned subsidiary of Ducommun Inc., provides system solutions and engineering support to missile and space customers Missiles and Space Core Capabilities

• Missiles, satellites, KVs
• Inertial navigation systems
• Lasers

Systems Core Capabilities

• Test management and planning
• Range and operations support
• Systems engineering and integration

Research and Technology Core Capabilities

• Basic and applied research in acoustics
• Aviation and UAV sensors
• Cruise missile detection and tracking

Providing Design and Engineering Services and Contract Labor

20

SLIDE 21

Miltec Corporation Overview

• Services
• Design
• Development
• Analysis
• Prototyping

Engineering Center

Oxford & Iuka, MS Huntsville, AL

Integration and Test

• Assembly & Integration
• IRAD
• Test & Evaluation

Providing Design and Engineering Services and Contract Labor

21

SLIDE 22

Characteristics Legend Full Partial None

22

DCO Focus on Tier II Tier II Characteristics Matrix

Tier II ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ DAS DLT Miltec

Filling gaps through acquisition and capitalization

SLIDE 23

23

Key Growth Drivers Allowing Ducommun to Expand Market Presence and Service Capabilities

DAS DLT

 Overall A&D market to grow 3-5% over the long-term  Commercial programs expect to benefit from increased shipments to support the higher build rates

– Boeing 737, 747, 777 and 787 programs – Airbus A330, A340, and A380 platforms

 Expect strong performance for Black Hawk and the Joint Strike Fighter  Overall low volume, high mix market growing 3-5% over the long-term

– Outsourcing trend drives market growth – Increased electronics content – Strong demand for military electronics solutions

 Solid sales on the F-15 , F-16 and F-18 AESA radar solutions  Increased industrial, energy and medical applications requirements

SLIDE 24

24

Significant Product Offerings Create Synergy Opportunities

Interconnect Systems Integrated Electronic Assemblies Display Systems / EMS Assemblies Advanced Microwave Switches High Performance Motors & Resolvers

Wiring Harness Temperature Control Interconnect Systems

PCB Assemblies Higher Level Assemblies Systems Integration

Multi-Branched Harness High-Flexibility Molded Gimbal Cable Display Panels Resolver Stepper Motors Raytheon AESA Radar Rack Microwave Transfer Switch Microwave Multi Position Switch Military Radar Systems Factory Automation RF & Digital Assembly Complex Wired Chassis Quality Systems Testing Capabilities

High Synergy Potential

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UH-60 Black Hawk

…with Increased Content on Growing A&D Platforms

Expansion of Current Platforms

F-35 Joint Strike Fighter

 Overhead panel assemblies  Circuit card assemblies and coaxial cables  Cockpit and airframe harnesses  Firewalls  Window assemblies  Hellfire rack  Door assemblies  Erosion shields / leading edge for rotary wings  Exhaust ducts  Cable harnesses  Circuit card assemblies  Power supplies  Engine ducts

Significant combined presence on long-term growth platforms

DAS DLT DAS DLT

SLIDE 26

Ducommun – Foam Matrix System

Foam Matrix Background

Foam Matrix Inc.

• Founded in 1995 by Kent Sherwood
• Starting with technology originally

developed for sporting goods applications including surf boards and skate boards, evolved into an innovative aerospace composite company Patented Process

• Multiple Patents on composite

manufacturing methods.

• Additional research under DOD Small

Business Innovative Research Programs SBIR Foam Matrix provides innovative structural solutions for Aerospace and Defense Applications:

• FMC System
• AirCor
• FomCel
• Matrix Shield

January 2011 – Foam Matrix becomes part of Ducommun AeroStructures

Key Foam Matrix Programs

• X45 UCAV Wing
• Insitu Scan Eagle
• Pegasus Fins
• C17 Engine Inlet Strake
• JASSM Wings / tail

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FoamMatrix System

The Foam Matrix System is a unique, patented process for producing net molded composite structures without ovens or autoclaves. Benefits

• No ovens or autoclave
• Low Part Count
• Seamless Construction
• De-Toleranced Assemblies
• Short Cycle Times
• Integrated Features
• Cored and Hollow Parts
• High Reproducibility
• Fully tooled surfaces
• Durable – Damage Resistant
• Simplified repairs
• Room Temp Material Storage
• Lower Cost Parts!

Single tool process to build net molded lofted parts!

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Development Cycle

• 3. Domestic market

penetration

• 4. International market

penetration

• 5. Ongoing support
• 6. Additional industries
• 2. Proof and refinement
• 1. Patents

Technology aligned with Market Demands?

• Consistent with current and projected market demands
• Commercially available materials
• Fast cycle times – min/max
• Readily field repairable with limited materials/skill set

Technology into production

• Foam Matrix can not adequately bring the technology to full market penetration
• A strategic partner with market clout could readily penetrate the market
• Ideal Partner – Similar Customers or Products
• Internal and External Customers

Ducommun ideal fit for exploiting Foam Matrix Technology

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SLIDE 29

Ducommun Summary - A “Best Value” Strategic Partner

 Focused on our customer requirements, we are a profitable, well-

managed company with a solid reputation, well positioned for growth

 Ducommun’s market position is a significant Tier 2 supplier for

structural and electronic assemblies, and Engineering Services

 Full-service provider of manufacturing services for A&D Industrial,

Natural Resources and Medical markets with highly specialized capabilities

 Excellent strategic partner, providing diversified capabilities, products

and services, focused on growth opportunities

 Broad value-added service offerings including engineering and design,

and program management

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Summary of Ducommun’s Key Strengths

Experienced Management Team Significant Synergy Opportunity as a Combined Entity Considerable Barriers to Entry with High Switching Costs Leading Manufacturing Services Supplier to the A&D Industry Diversified End Markets and Platforms with Strong Industry Fundamentals Long-Term Relationships with Blue Chip Customer Base Solid Revenues Supported by a Strengthening Backlog