TGI Triumph Group Inc

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 1, 2024

TRIUMPH GROUP, INC.

(Exact name of registrant as specified in its charter)

Delaware		1-12235		51-0347963
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

555 E Lancaster Avenue, Suite 400
Radnor, Pennsylvania		19087
(Address of principal executive offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (610) 251-1000
 

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $.001 per share		TGI		New York Stock Exchange
Purchase Rights		N/A		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Item 2.01 Completion of Acquisition or Disposition of Assets.

The closing of the transactions (the “Transaction”) under the Security and Asset Purchase Agreement, dated December 21, 2023 (the “Agreement”), by and between Triumph Group, Inc., a Delaware corporation (the “Company”), Triumph Aftermarket Services Group, LLC, a Delaware limited liability company, Triumph Group Acquisition Corp., a Delaware corporation, Triumph Group Acquisition Holdings, Inc., a Delaware corporation, and The Triumph Group Operations, Inc., a Delaware corporation (collectively, the “Sellers”), and AAR Corp., a Delaware corporation (“Buyer”), occurred on March 1, 2024. In connection therewith, the Sellers sold the Product Support business to Buyer for $725 million in cash, subject to customary adjustments set forth in the Agreement.

The foregoing description of the Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Agreement, a copy of which was attached as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on December 22, 2023, and the terms of which are incorporated by reference herein.

Item 7.01 Regulation FD Disclosure.

On March 1, 2024, the Company issued a press release announcing the closing of the Transaction. A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

The information in this Item 7.01, including Exhibit 99.1, is furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to liabilities under that section, and shall not be deemed to be incorporated by reference into any filing of the registrant under the Securities Act of 1933, as amended, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference to such filing.

Item 9.01 Financial Statements and Exhibits.

(b) Pro Forma Financial Information.

Unaudited pro forma consolidated financial information of Triumph Group, Inc., giving effect to the Transaction, is attached hereto as Exhibit 99.2.

(d) Exhibits.

Exhibit No.		Description
2.1		Securities and Asset Purchase Agreement, dated as of December 21, 2023, by and among Triumph Group, Inc., Triumph Aftermarket Services Group, LLC, Triumph Group Acquisition Corp., Triumph Group Acquisition Holdings, Inc., The Triumph Group Operations, Inc. and AAR CORP. (incorporated by reference to Exhibit 2.1 to the Form 8-K filed by Triumph Group, Inc. on December 22, 2023).*
99.1		Press Release dated March 1, 2024, issued by Triumph Group, Inc., regarding the Transaction
99.2		Triumph's Unaudited Pro Forma Condensed Consolidated Financial Statements.
104.1		Cover page interactive data file (embedded within the Inline XBRL document).

* Schedules (as similar attachments) have been omitted from this filing pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule will be furnished to the Securities and Exchange Commission upon request.

 

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Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: March 7, 2024	TRIUMPH GROUP, INC.     By: /s/ Jennifer H. Allen______________________  Jennifer H. Allen Chief Administrative Officer and Senior Vice President, General Counsel and Secretary

 

 

 

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Exhibit 99.1

 

NEWS RELEASE

 

Contact: Thomas A. Quigley, III VP, Investor Relations, Mergers & Acquisition and Treasurer Phone (610) 251-1000 tquigley@triumphgroup.com

 

TRIUMPH COMPLETES SALE OF PRODUCT SUPPORT BUSINESS TO AAR

 

 

RADNOR, Pa. – March 1, 2024 – Triumph Group, Inc. (NYSE: TGI) ("TRIUMPH" or the “Company”) announced today that it has completed the sale of its Product Support business to AAR CORP. (NYSE: AIR). The transaction is valued at $725 million, and the net after-tax proceeds are expected to be approximately $700 million, which will primarily be used for debt reduction.

The Product Support business is an industry leader in the Maintenance, Repair and Overhaul (MRO) of structures and airframe and engine accessories, servicing both the commercial and military aftermarkets across five primary locations.

“We are pleased to complete this transformative divestiture which delivers immediate and substantial value to TRIUMPH and our stakeholders. This transaction enables TRIUMPH to greatly accelerate our deleveraging progress while placing our third-party Product Support business with a market-leading MRO company that has a proven track record of customer support” said Dan Crowley, TRIUMPH’s chairman, president, and chief executive officer. “By strengthening our balance sheet and focusing on our OEM component, spares and IP-based aftermarket business, TRIUMPH will further improve its capacity to win and expects to profitably grow in the expanding markets we serve.”

Upon completion of the transaction, TRIUMPH will advance in aerospace and its adjacent markets as a value-added and IP-based business. The Systems & Support segment will consist of three pure play engineered systems components and aftermarket companies focused on Actuation Products and Services, Systems Electronics and Controls, and Geared Solutions. Together with the Interiors segment, TRIUMPH now has 21 sites and approximately 4,500 employees, and over 60% of the Company’s products and services will be based on TRIUMPH intellectual property and 90% supplied on a sole-sourced basis.

About TRIUMPH

TRIUMPH, headquartered in Radnor, Pennsylvania, designs, develops, manufactures, repairs and overhauls a broad portfolio of aerospace and defense systems and components. The company serves the global aviation industry, including original equipment manufacturers and the full spectrum of military and commercial aircraft operators.

More information about TRIUMPH can be found on the Company’s website at triumphgroup.com.

Forward Looking Statements

Statements in this release which are not historical facts are forward-looking statements under the provisions of the Private Securities Litigation Reform Act of 1995, including statements of expectations of or assumptions about financial and operational performance, revenues, earnings per share, cash flow or use, cost savings, operational efficiencies and organizational restructurings and our evaluation of potential adjustments to reported amounts, as described above. Forward-looking statements may also be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,’’ “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “seek,” “should,” “target,” “will,” or similar expressions and the negatives of those terms. All forward-looking statements involve risks and uncertainties which could affect the Company’s actual results and could cause its actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, the Company. Such risks and uncertainties include, without limitation the inability to increase the Company’s profitability and growth, adequately deleverage its business, strengthen its balance sheet and win new business. Further information regarding the important factors that could cause actual results to differ from projected results can be found in Triumph Group’s reports filed with the SEC, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2023.

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Exhibit 99.2

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Overview

On March 1, 2024, Triumph Group, Inc. ("Triumph" or the “Company”) completed its previously announced sale of its maintenance, repair, and overhaul operations located in Wellington, Kansas; Grand Prairie, Texas; San Antonio, Texas; Hot Springs, Arkansas; and Chonburi, Thailand (“Product Support” or "TPS") to AAR CORP. (“AAR”) (the "TPS Divestiture"), pursuant to a securities and asset purchase agreement entered into on December 21, 2023, (as amended or supplemented through the date hereof) (the “Divestiture Agreement”), for a purchase price of $725 million in cash, subject to transaction adjustments in accordance with the Divestiture Agreement. For purposes of the unaudited pro forma condensed balance sheet, the cash proceeds received by the Company at closing, which are net of estimated closing adjustments and transaction cost funding, have been reflected as approximately $701 million. The divestiture of Product Support represents a strategic shift and therefore, beginning with the Company's quarterly report on Form-10-Q for the period ended December 31, 2023, Product Support was reflected as discontinued operations, including prior periods.

On February 6, 2024, Triumph issued (i) a notice of conditional redemption in respect of up to all $435.6 million of its outstanding 7.750% Senior Notes due 2025 (the “2025 Notes”) to be redeemed on March 6, 2024 (the "2025 Notes Redemption) and (ii) a notice of conditional redemption in respect of $120.0 million of its 9.000% Senior Secured First Lien Notes due 2028 (the “First Lien Notes”) to be redeemed on March 4, 2024 (the "First Lien Notes Redemption") (together, the "Senior Notes Redemptions"). The Senior Notes Redemptions were conditioned upon the consummation of the TPS Divestiture and therefore, on March 1, 2024, the Company concluded that the redemptions described on its February 6, 2024, Form 8-K were probable and the disclosure of related pro forma financial information would be material to investors.

Unaudited Pro Forma Financial Information

The following unaudited pro forma consolidated financial statements of Triumph were derived from its historical consolidated financial statements and are being presented to give effect to the TPS Divestiture and the Senior Notes Redemptions (together, the "Transactions"). The unaudited pro forma condensed consolidated balance sheet as of December 31, 2023, gives effect to the Transactions as if they had occurred on that date. As the TPS Divestiture was reflected as a component of discontinued operations within the condensed consolidated statement of operations in Triumph's Quarterly Report on Form 10-Q for December 31, 2023, the unaudited pro forma consolidated statements of operations for the nine months ended December 31, 2023, only reflects pro forma transaction adjustments for the Senior Notes Redemptions.

The unaudited pro forma consolidated statements of operations for the years ended March 31, 2023, 2022 and 2021 give effect to the pro forma discontinued operations presentation of the TPS Divestiture as if the TPS Divestiture had occurred on April 1, 2020, and in accordance with Financial Accounting Standards Board Accounting Standards Codification 205, “Presentation of Financial Statements” (“ASC 205”) for those historical periods.

The unaudited pro forma consolidated statements of operations for the year ended March 31, 2023, give effect to the pro forma Senior Notes Redemptions as if they had occurred on April 1, 2022, after adjusting for the effects of the TPS Divestiture as disclosed further in Note 2 below.

The unaudited pro forma consolidated financial statements should be read in conjunction with: (i) the accompanying notes to the unaudited pro forma condensed consolidated financial statements, (ii) Triumph's audited consolidated financial statements, the accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company's Annual Report on Form 10-K for the year ended March 31, 2023; and (iii) Triumph's unaudited condensed consolidated financial statements, the accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2023.

The unaudited pro forma consolidated financial statements, prepared in accordance with Securities and Exchange Commission (“SEC”) Regulation S-X Article 11, Pro Forma Financial Information, have been prepared based upon the best available information and management estimates and are subject to assumptions and adjustments described in the accompanying notes to these financial statements, are for informational purposes only, and are not intended to be a complete presentation of the Company's operating results or financial position had the TPS Divestiture occurred as of and for the periods indicated, nor do they purport to project the results of operations or financial position for any future period or as of any future date. Accordingly, such information should not be relied upon as an indicator of future performance, financial condition or liquidity.

 

 

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TRIUMPH GROUP, INC.

Unaudited Pro Forma Condensed Consolidated Balance Sheets

as of December 31, 2023

 

(in thousands)		As Reported				TPS Divestiture					Senior Notes Redemptions					Total Pro Forma
ASSETS						Note 1					Note 2
Current assets:
Cash and cash equivalents		$	162,899			$	701,214		(a)		$	(575,202	)	(c)		$	288,911
Trade and other receivables, net			127,494				—					—					127,494
Contract assets			89,406				—					—					89,406
Inventory, net			352,188				—					—					352,188
Prepaid expenses and other current assets			16,578				—					—					16,578
Assets held for sale - current			180,642				(180,642	)	(a)			—					—
Total current assets			929,207				520,572					(575,202	)				874,577
Property and equipment, net			141,583				—					—					141,583
Goodwill			511,571				—					—					511,571
Intangible assets, net			67,308				—					—					67,308
Other, net			26,913				—					—					26,913
Total assets		$	1,676,582			$	520,572				$	(575,202	)			$	1,621,952
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Current portion of long-term debt		$	3,342			$	(141	)	(b)			—					3,201
Accounts payable			133,550				—					—					133,550
Contract liabilities			40,182				—					—					40,182
Accrued expenses			140,092				(6,835	)	(b)			(15,981	)	(c)			117,276
Liabilities related to assets held for sale - current			32,216				(32,216	)	(a)			—					—
Total current liabilities			349,382				(39,192	)				(15,981	)				294,209
Long-term debt, less current portion			1,627,810				(193	)	(b)			(555,621	)	(c)			1,071,996
Accrued pension and other postretirement benefits			301,661				—					—					301,661
Deferred income taxes			7,356				—					—					7,356
Other noncurrent liabilities			60,653				—					—					60,653
Stockholders' deficit:
Common stock			77				—					—					77
Capital in excess of par value			1,107,241				—					—					1,107,241
Treasury stock, at cost			(5	)			—					—					(5	)
Accumulated other comprehensive loss			(534,676	)			—					—					(534,676	)
Accumulated deficit			(1,242,917	)			559,957		(a)			(3,600	)	(c)			(686,560	)
Total stockholders' deficit			(670,280	)			559,957					(3,600	)				(113,923	)
Total liabilities and stockholders' deficit		$	1,676,582			$	520,572				$	(575,202	)			$	1,621,952

 

 

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TRIUMPH GROUP, INC.

Unaudited Pro Forma Condensed Consolidated Statement of Operations

for the Nine Months Ended December 31, 2023

 

(in thousands, except per share amounts)	As Reported				Senior Notes Redemptions					Total Pro Forma
Net sales	$	833,456			$	—				$	833,456
Operating costs and expenses:
Cost of sales (exclusive of depreciation shown separately below)		618,742				—					618,742
Selling, general and administrative		135,479				—					135,479
Depreciation and amortization		22,062				—					22,062
Legal judgment loss		1,338				—					1,338
Restructuring		1,985				—					1,985
Loss on sale of assets and businesses		12,208				—					12,208
		791,814				—					791,814
Operating income		41,642				—					41,642
Non-service defined benefit income		(2,460	)			—					(2,460	)
Debt modification and extinguishment (gain) loss		(5,125	)			9,691		(d)			4,566
Warrant remeasurement gain, net		(8,545	)			—					(8,545	)
Interest expense and other, net		94,354				(15,488	)	(d)			78,866
Loss from continuing operations before income taxes		(36,582	)			5,797					(30,785	)
Income tax expense		3,348				—		(g)			3,348
Net loss	$	(39,930	)		$	5,797				$	(34,133	)
Loss per share - continuing operations—basic	$	(0.55	)							$	(0.47	)
Weighted average common shares outstanding—basic		73,200									73,200
Loss per share - continuing operations—diluted	$	(0.55	)							$	(0.47	)
Weighted average common shares outstanding—diluted		73,200									73,200

 

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TRIUMPH GROUP, INC.

Unaudited Pro Forma Condensed Consolidated Statement of Operations

for the Year Ended March 31, 2023

 

(in thousands, except per share amounts)	As Reported				(a) TPS Divestiture				Senior Notes Redemptions					Total Pro Forma
					Note 1				Note 2
Net sales	$	1,379,128			$	(248,566	)			—				$	1,130,562
Operating costs and expenses:
Cost of sales (exclusive of depreciation shown separately below)		991,599				(181,717	)			—					809,882
Selling, general and administrative		210,430				(19,342	)			—					191,088
Depreciation and amortization		35,581				(3,322	)			—					32,259
Restructuring		4,949				(1,777	)			—					3,172
Gain on sale of assets and businesses		(101,523	)			—				—					(101,523	)
		1,141,036				(206,158	)			—					934,878
Operating income		238,092				(42,408	)			—					195,684
Non-service defined benefit income		(19,664	)			—				—					(19,664	)
Debt modification and extinguishment loss		33,044				—				7,337		(e)			40,381
Warrant remeasurement gain, net		(8,683	)			—				—					(8,683	)
Interest expense and other, net		137,714				(22,504	)			(23,059	)	(e)			92,151
Income from continuing operations before income taxes		95,681				(19,904	)			15,722					91,499
Income tax expense		6,088				(2,442	)			—		(g)			3,646
Net income	$	89,593			$	(17,462	)		$	15,722				$	87,853
Earnings per share - continuing operations—basic	$	1.38												$	1.35
Weighted average common shares outstanding—basic		65,021													65,021
Earnings per share - continuing operations—diluted	$	1.20											(f)	$	1.17
Weighted average common shares outstanding—diluted		71,721													71,721

 

 

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TRIUMPH GROUP, INC.

Unaudited Pro Forma Condensed Consolidated Statement of Operations

for the Year Ended March 31, 2022

 

(in thousands, except per share amounts)	As Reported				(a) TPS Divestiture				Total Pro Forma
Net sales	$	1,459,942			$	(197,238	)		$	1,262,704
Operating costs and expenses:
Cost of sales (exclusive of depreciation shown separately below)		1,073,063				(144,426	)			928,637
Selling, general and administrative		202,070				(17,815	)			184,255
Depreciation and amortization		49,635				(4,126	)			45,509
Impairment of long-lived assets		2,308				—				2,308
Restructuring		19,295				(74	)			19,221
Loss on sale of assets and businesses		9,294				—				9,294
		1,355,665				(166,441	)			1,189,224
Operating income		104,277				(30,797	)			73,480
Non-service defined benefit income		(5,373	)			—				(5,373	)
Debt modification and extinguishment loss		11,624				—				11,624
Interest expense and other, net		135,861				(22,781	)			113,080
Loss from continuing operations before income taxes		(37,835	)			(8,016	)			(45,851	)
Income tax expense		4,923				(110	)			4,813
Net loss	$	(42,758	)		$	(7,906	)		$	(50,664	)
Loss per share - continuing operations—basic	$	(0.66	)						$	(0.79	)
Weighted average common shares outstanding—basic		64,538								64,538
Loss per share - continuing operations—diluted	$	(0.66	)						$	(0.79	)
Weighted average common shares outstanding—diluted		64,538								64,538

 

 

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TRIUMPH GROUP, INC.

Unaudited Pro Forma Condensed Consolidated Statement of Operations

for the Year Ended March 31, 2021

 

(in thousands, except per share amounts)	As Reported				(a) TPS Divestiture				Total Pro Forma
Net sales	$	1,869,719			$	(171,278	)		$	1,698,441
Operating costs and expenses:
Cost of sales (exclusive of depreciation shown separately below)		1,476,266				(153,896	)			1,322,370
Selling, general and administrative		215,962				(18,787	)			197,175
Depreciation and amortization		93,334				(4,633	)			88,701
Impairment of long-lived assets		252,382				—				252,382
Restructuring		53,224				—				53,224
Loss on sale of assets and businesses		104,702				—				104,702
		2,195,870				(177,316	)			2,018,554
Operating loss		(326,151	)			6,038				(320,113	)
Non-service defined benefit income		(49,519	)			—				(49,519	)
Interest expense and other, net		171,397				(26,226	)			145,171
Loss from continuing operations before income taxes		(448,029	)			32,264				(415,765	)
Income tax expense		2,881				108				2,989
Net loss	$	(450,910	)		$	32,156			$	(418,754	)
Loss per share - continuing operations—basic	$	(8.55	)						$	(7.94	)
Weighted average common shares outstanding—basic		52,739								52,739
Loss per share - continuing operations—diluted	$	(8.55	)						$	(7.94	)
Weighted average common shares outstanding—diluted		52,739								52,739

 

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

The following items resulted in adjustments in the unaudited pro forma condensed consolidated financial statements.

Transaction Accounting Adjustments:

Note 1

Note 2

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v3.24.0.1

Document and Entity Information	Mar. 01, 2024
Document Information [Line Items]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Mar. 01, 2024
Entity Registrant Name	TRIUMPH GROUP, INC.
Entity Central Index Key	0001021162
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	51-0347963
Entity File Number	1-12235
Entity Address, Address Line One	555 E Lancaster Avenue
Entity Address, Address Line Two	Suite 400
Entity Address, City or Town	Radnor
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	19087
City Area Code	(610)
Local Phone Number	251-1000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common Stock [Member]
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $.001 per share
Trading Symbol	TGI
Security Exchange Name	NYSE
Purchase Rights [Member]
Document Information [Line Items]
Title of 12(b) Security	Purchase Rights
No Trading Symbol Flag	true
Security Exchange Name	NYSE

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