Wood told FINN: “We've been driving hard to refine the strategy to really get strong organic growth. We're very clear going forward: we're an aerospace, defence and selective energy company. In order to take that position on the world stage, obviously we're a bigger company today, and that gives us many opportunities to grow and become a bigger player in the industry.”
Meggitt is involved with some 69,000 aircraft that are flying today, Wood said, and has a footprint from the sensing systems, control systems and advanced engine composites to fuel containment systems.
"We are literally present on just about every platform that you'll see at an airshow.”By Tony Wood, Meggitt
“It's a very nicely balanced portfolio,” he said. “Half of the business is commercial aerospace and about 35% defence, so we are literally present on just about every platform that you'll see at an airshow.”
There have been challenges, though, Wood said.
“It’s been a bit choppy over recent years obviously,” he noted. “Not only the drop in oil price and the softening in defence spending, which is clearly now returning – the world's not getting any safer – but also at a peak time for us in terms of R&D. So we've been renewing the portfolio of products as the legacy programmes start to retire, and that all happened at the same time. So, yes, a very challenging period, but one where it was a steady hand at the tiller really, to keep the investment line going. And we're now starting to see the benefit of that.
"Also, the company is much more front-footed on its technology and its investment for the future.
Integrating the business
Meggitt has sold seven of its businesses off in the last 18 months.
Commenting on this strategy, Wood said: “Historically, we were a holding company, and that meant we were in a very wide number of markets – a very acquisitive company. Increasingly, we've been on a journey to become a much more integrated business. The decision we've taken is that we will exit a lot of those non-core businesses in automotive, healthcare, and also some light industrial businesses.
"We’ve sold seven businesses over the last 18 months. That’s the crowning of our strategy to become a much more integrated business, and organisational change that will take us to be very focused around our four end markets.
“That kicks in on January 1, and that will organise the group around our airframe system customers, engine systems customers, and energy and equipment customers, with after-market as a separate business. So from six divisions to four and a very customer-focused organisation going forward.”
One question we ask all the CEOs in the From The Top series is: What keeps you awake at night?
Wood said: “We're a global business, we have a lot of operations around the world. I guess the challenge for almost all of us at the moment is a nice challenge to have – we're going through an unprecedented period of growth on both engine programmes and airframe programmes. That's exciting, and that certainly keeps the blood flowing as we're obviously industrialising all of those great inventions and designs that we've been investing in over the last few years. The technology race never stops, so a lot of ongoing investment in technology [is required] to stay ahead.”