23-01-2016, 03:40 PM
Our client, Milco, is a leading Aerospace & Defense provider with ~$2B in revenue. The company offers a broad range of electronic products and systems, largely used on military platforms. Core products include military flight simulators and Maintenance, Repair, & Overhaul (MRO) technology systems, as well as services such as flight simulation instruction and MRO system diagnostic & repair. Milco also has been growing its Military Construction offering. Milco’s customers include the United States (U.S.) Department of Defense (DoD) and its prime contractors, U.S. Government intelligence agencies, the U.S. Department of Homeland Security (DHS), and select other U.S. federal, state, and local government agencies. While revenue in Milco’s core segments have remained strong, the dynamics of the U.S. defense industry are challenging the way they will need to conduct business going forward, forcing them to be more agile and cost effective. While traditional defense contractors used to have a ‘lock’ on the U.S. market, new entrants have joined the mix, removing some of the leverage Milco once had, making the environment much more competitive. Additionally, in response to U.S. Defense budget cutbacks, which have been steadily increasing over the last few years, Milco, and their competitors, have started to look beyond the U.S. market, exploring opportunities to offer products and services to customers in emerging geographies.
Milco recognizes the need to change the way they operate in order to reach their goals. Milco’s executive team feels a review of their current products and services is warranted to allow them to successfully compete, as well as an exploration of the potential for acquiring new capabilities to broaden their portfolio. Additionally, the executive team believes there are potential growth opportunities in several international markets. You have been engaged to help assess how Milco should move forward to strategically drive growth and margin. The brief for your team involves
• Financial Performance
– Construct a basic income statement for Milco. How would you assess the company’s overall financial
performance and health? – Are there any products/service segments that Milco may want to consider exiting from? Please support with data points.
• Competitive Position
– What is Milco’s current competitive position? Based on the data provided, segment and assess each of Milco’s major competitors.
– In what existing product/service offerings will Milco possibly be able to capture additional share?
• Recommendations
– Based on your understanding of Milco’s financial performance and competitive positioning, what should
be management’s top priorities. Recommend initiatives or opportunities for Milco to improve its position.
Ground Rules Feel free to use external research sources and make logical assumptions where necessary. Please ensure that all external sources, data, and assumptions are captured explicitly in your deliverable. Please make all submissions in PowerPoint format, limiting the main deliverable to a maximum of eight slides (including one-slide executive summary). Appendix can be used to capture external research, assumptions, or any other references/analysis in detail.