Wesco Aircraft Holdings, Inc. (NYSE:WAIR), one of the world’s
leading distributors and providers of comprehensive supply chain
management services to the global aerospace industry, today
announced the launch of Wesco 2020 – Building the Future, focused
on service excellence, inventory management and profitable growth.
As previously announced, the company initiated a
comprehensive business assessment to determine the steps necessary
to improve its operational and financial performance. The
assessment process confirmed that opportunities exist for a
significant uplift in profitability through footprint alignment,
organizational refinement and broader productivity gains, as well
as a need to invest in upgrading critical capabilities to serve
customers and manage inventory better.
The assessment led to the development of Wesco
2020, with the following key initiatives:
- Align the company’s footprint with its
customer and supplier base to enhance service, improve operating
efficiency and reduce costs. The company plans to establish
full-service distribution centers with multiple commodities that
better serve customers.
- Refine the organizational structure to drive
greater accountability, enhance capabilities, reduce management
layers, eliminate duplication and lower costs. The company’s new
organizational structure further empowers business segments and
establishes centers of excellence to leverage best practices and
lead continuous improvement efforts.
- Invest strategically in people and
capabilities, including automation and business tools to drive more
effective inventory management and greater efficiency. The company
plans to enhance warehouse management systems, implement technology
to automate administrative tasks and improve ecommerce and customer
portals.
Todd Renehan, chief executive officer, said, “We
have made considerable progress improving our business, achieving
better operating and financial results in the first half of fiscal
2018. While this progress is encouraging, we still have gaps in our
execution. Wesco 2020 is expected to accelerate these improvements,
leading to a step-change in operational performance and financial
results.”
Renehan continued, “It’s clear that in today’s
market, customers demand a broad service offering with flawless
execution; as the market evolves, we must provide best-in-class
service to meet their needs. The significant benefits expected
through Wesco 2020 will allow us to invest in our capabilities to
continue supporting our customers and deliver long-term value to
shareholders. At the same time, we will remain vigilant in
controlling the pace of implementation, balancing the sense of
urgency necessary to achieve improvement with the need to continue
providing our customers with outstanding service.”
Wesco 2020 is expected to deliver annualized
pre-tax benefits of at least $30 million; benefits realization is
expected to start in the first quarter of fiscal 2019, with the
run-rate improving steadily as the year progresses. The company
expects to incur non-recurring costs associated with Wesco 2020
approximately equal to the run-rate benefit over the implementation
period.
Additional information is provided with the
company’s fiscal 2018 second quarter financial results, which are
discussed in a separate press release issued today.
About Wesco Aircraft
Wesco Aircraft is one of the world’s leading
distributors and providers of comprehensive supply chain management
services to the global aerospace industry. The company’s services
range from traditional distribution to the management of supplier
relationships, quality assurance, kitting, just-in-time delivery,
chemical management services, third-party logistics or fourth-party
logistics and point-of-use inventory management. The company
believes it offers one of the world’s broadest portfolios of
aerospace products, including C-class hardware, chemical and
electrical and comprised of more than 565,000 active SKUs.
To learn more about Wesco Aircraft, visit our
website at www.wescoair.com. Follow Wesco Aircraft on LinkedIn at
https://www.linkedin.com/company/wesco-aircraft-corp.
Forward-Looking Statements
This press release contains forward-looking
statements (including within the meaning of the Private Securities
Litigation Reform Act of 1995) concerning Wesco Aircraft Holdings,
Inc. These statements may discuss goals, intentions and
expectations as to future plans, trends, events, results of
operations or financial condition, or otherwise, based on current
beliefs of management, as well as assumptions made by, and
information currently available to, management. In some cases,
readers can identify forward-looking statements by the use of
forward-looking terms such as “achieve,” “believe,” “continue,”
“deliver,” “drive,” “enhance,” “expect,” “future,” “grow,”
“improve,” “initiative,” “opportunity,” “plan,” “will” or similar
words, phrases or expressions. These forward-looking statements are
subject to various risks and uncertainties, many of which are
outside the company’s control. Therefore, the reader should not
place undue reliance on such statements.
Factors that could cause actual results to
differ materially from these forward-looking statements include,
but are not limited to, the following: general economic and
industry conditions; conditions in the credit markets; changes in
military spending; risks unique to suppliers of equipment and
services to the U.S. government; risks associated with the
company’s long-term, fixed-price agreements that have no guarantee
of future sales volumes; risks associated with the loss of
significant customers, a material reduction in purchase orders by
significant customers, or the delay, scaling back or elimination of
significant programs on which the company relies; the company’s
ability to effectively compete in its industry; the company’s
ability to effectively manage its inventory; the company’s
suppliers’ ability to provide it with the products the company
sells in a timely manner, in adequate quantities and/or at a
reasonable cost; the company’s ability to maintain effective
information technology systems; the company’s ability to retain key
personnel; risks associated with the company’s international
operations, including exposure to foreign currency movements; risks
associated with assumptions the company makes in connection with
its critical accounting estimates (including goodwill, excess and
obsolete inventory and valuation allowance of the company’s
deferred tax assets) and legal proceedings; changes in U.S. tax
law; changes in trade policies; the company’s dependence on
third-party package delivery companies; fuel price risks;
fluctuations in the company’s financial results from
period-to-period; environmental risks; risks related to the
handling, transportation and storage of chemical products; risks
related to the aerospace industry and the regulation thereof; risks
related to the company’s indebtedness; and other risks and
uncertainties.
The foregoing list of factors is not exhaustive.
The reader should carefully consider the foregoing factors and the
other risks and uncertainties that affect the company’s business,
including those described in Wesco Aircraft’s Annual Report on Form
10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K
and other documents filed from time to time with the Securities and
Exchange Commission. All forward-looking statements included in
this news release (including information included or incorporated
by reference herein) are based upon information available to the
company as of the date hereof, and the company undertakes no
obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Contact Information:
Jeff MisakianVice President, Investor
Relations661-362-6847Jeff.Misakian@wescoair.com
Wesco Aircraft (NYSE:WAIR)
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