Triumph Group names Raytheon executive as CEO, shares rise 19 percent

By Andrea Shalal

WASHINGTON (Reuters) - Shares of Triumph Group Inc , a supplier of aerospace components and systems, rose 19 percent on Tuesday after it named Dan Crowley, a senior executive at Raytheon Co , as chief executive.

Crowley, also appointed Triumph's president, said he planned to help the company "raise its bar on performance" and would undertake a "top to bottom strategic review" aimed at boosting its operational performance and margins, while expanding its defence and international business.

Crowley will replace Richard Ill, effective Jan. 4. Ill founded Triumph and served has served as CEO since April 2015, after previously serving as CEO from 1993 until his retirement in July 2012. He will remain a member of the board of the Berwyn, Pennsylvania-based company.

 

Triumph shares closed at $40.98 per share, raising the company's market capitalisation more than $300 million, to $1.7 billion.

Crowley, who held senior positions with Lockheed Martin Corp before joining Raytheon in 2010, told Reuters he would study the company's business areas closely before making recommendations on any portfolio changes to the board."Triumph is in need of some changes in operational execution and strategy," Crowley said. "But the overall market in which Triumph competes is still a very attractive market," with expected annual growth of 4 percent of 7 percent per year, spurred by what he called the "democratization of air travel."

He said he had been in touch with the CEOs of key customers, including Boeing Co , Northrop Grumman Corp , Airbus Group SE , Bombardier Inc , the Gulfstream unit of General Dynamics Corp and Brazil's Embraer SA about his new role, and received positive reactions.

"It's a very competitive business, and Triumph knows that it has to raise its bar on performance," he said. He said major equipment manufacturers such as Boeing were pressuring suppliers to improve cost, quality and delivery times, and he hoped Triumph could win one of Boeing's annual operational excellence awards.

He said Triumph had been, and would remain, active in the mergers and acquisitions market, but his initial focus would be on better integrating companies acquired in recent years and assessing the strengths of various business units.

RBC Capital Markets' Steven Cahall said the announcement was the catalyst that market had been waiting for.

"The street broadly feels it will take an outsider to shake things up and kick-start a meaningful operational improvement process," he wrote in a note to investors.

(Reporting by Andrea Shalal; Editing by Alan Crosby and Steve Orlofsky)