Triumph Group, Inc. today provided an update on the current impact of the coronavirus (COVID-19) on the business and the steps the Company is taking to mitigate it.
- All 36 of Triumph’s operational factories have returned to safe operational status following closures related to government-mandated shutdowns, COVID-19 cases, and temporary closure of customer facilities.
- The State of Baja in Mexico approved aerospace factories, including Triumph’s Mexicali interiors operation that supports Boeing and Airbus deliveries, to return to work. Employees have returned to work at levels consistent with customer demand.
- Selected sites with stay at home orders for non-essential salaried personnel will return to work in waves consistent with local government approvals.
The Company also reported on further safeguards made available to its sites as follows:
- Over 100,000 face coverings have been provided to Triumph personnel to ensure their safety.
- Temperature screening equipment has been added at multiple U.S. and international sites and thermometers provided to over 5,000 employees for self-checks.
- Designation of usable and restricted areas and traffic patterns to limit employee exposure risks.
- Use of inhouse and third-party cleaning services in commonly used areas.
- Adoption of staggered shifts at sites to reduce congestion at start and end of shifts.
To align capacity with short- and medium-term customer demand, conserve cash and maintain long-term competitiveness, the following actions are underway:
- Given the latest Boeing, Airbus and engine provider demand rates that provide sustaining levels of production at Triumph factories, Triumph has recalled approximately 2,000 of the previously announced 4,200 furloughs to resume production of OEM hardware.
- The previously announced 700-person reduction in force of salaried positions as part of its austerity measures has been completed. Triumph will reduce headcount to match the near-term forecast and conserve cash while preparing for the recovery in production rates and MRO demand.
- To reduce inventory and working capital expenditures, the Company is also adjusting its supply chain demand consistent with updated OEM production and aftermarket forecasts received in early May.
These actions preserve Triumph’s liquidity allowing Triumph to continue to support its customers’ anticipated rates of production. Further workforce adjustments may be required based on site closures or changes in demand for Triumph’s products and services. As of March 31, 2020, Triumph had over $550.0 million in cash and availability under its revolving credit agreement to support its working capital requirements.
Daniel J. Crowley, President and CEO of Triumph Group, commented, “Our workforce’s strong response to the COVID-19 crisis has minimized employee risks and customer impacts. We are increasing our safeguards to protect our people and ensure that any new infection cases are addressed quickly. Customer demand is firming up and we have secured orders to sustain economic production levels. We look forward to returning all employees to work consistent with state and local timelines.”