(MOG-A)
Recommendation Regarding Acquisition of MOOG Inc. (MOG-A)
Abstract
The purpose of this report was to analyze the company Moog Inc. and recommend on whether or not the Embry Investment Group should acquire it. This business report aims to investigate and evaluate Moog Inc.’s performance and competitiveness in the market. The Embry Investment Group wanted to conduct a background research on Moog Inc. before carrying out the process of acquisition. The business report consists of the executive summary and background information on Moog Inc., which includes their history, a summary of their function, a summary of Moog Inc.’s aims and objectives, and an assessment of Moog Inc’s future performances based on their annual reports. In addition, this paper also discusses the methodology that was used in the report to examine and analyze Moog Inc. before the Embry Investment Group acquisition. In particular, the methodology used for the business report is a qualitative descriptive research, which enables the researcher to analyze and observe the overall performance of Moog Inc. By observing and investigating the company’s performance, the researcher is able to provide a recommendation on whether or not the Embry Investment Group acquires Moog Inc.
Executive Summary
The business report shows that the performance of Moog Inc. is impressive and that the company is recognized internationally for their state-of-the-art technologies and revolutionary devices and components, which are needed for missile, aircraft, medical devices and components, and space and defense controls, including the security segments. Moog Inc. is a corporation that provides, manufactures, and supports motion control systems. The proficiency of the company is in solving and helping their clients with the difficulties they may have with regards to issues on motion control. Moog Inc. frequently fixes motion control problems through the engineering and design customization of the products that are purposely suitable for the client’s need. Moog Inc. is a leading corporation in the field of innovation and revolutionary technologies, control technologies, and the integration of the latest motion control technology (Moog 2015; Moog n.d). Today, the company’s manufacturing facilities are operating in 13 countries and in five segments – space and defense controls, industrial system, aircraft controls, devices and components for medical and industrial system. The aircraft controls of Moog Inc. supplies components for aircraft where the company accommodates Navigation Aids, Civil Aircraft, Military Aircraft, and Support for commercial products. The components and medical devices provide and designs capabilities for electronics, fiber optics, and motion in market. Moog Inc. improves and designs the enteral feeding pumps, ambulatory electronic infusion systems, and surgical hand pieces. On the other hand, the Defense and Space control segment is where the company designs, assemble, and provides components for cold gas and the electrical and chemical propulsion on satellites, as well as other related space devices. The company defense control segment provides newly improved conversion vehicles, the flexibility of the control actuation system for missiles. Moog Inc. also provides services to the security and industrial system sectors (Reuters 2015).
Background Information About (MOG-A)
Moog Inc. Annual Report 2014
Moog Inc. is a corporation that provides and designs the components for missile and aircraft. Moog Inc.’s prominent motion control technology improves the overall performances of several applications and markets such as the medical infusion system, power generation turbines, and the cockpits of commercial aircrafts. Moog Inc. began in 1951 when the founder, William Moog, an entrepreneur and inventor, created a valve that would revolutionize the flight control system of missile and aircraft. Bill Moog created an effective valve by developing a device called electro hydraulic servo valve that will translate the small electrical impulses into a powerful and accurate movement. In July of the same year, the brother of Bill name Arthur, together with Lou Geyer, formed Moog Vale Company (former name) in the rented corner of the abandoned Proner Airport located in East Aurora. In 1970, Moog Inc. entered the growing market for technological innovation and process motion control technology. In addition, the company is now frequently collaborating with the United States space program, which led them to obtaining a contract where they will provide and manufacture hardware and components for the space shuttle. In 1981, the space shuttle flew for the first time. The space shuttle used the revolutionary technology called ‘Fly by Wire’. Moog Inc continued their success for years to come and has proven to the world their outstanding abilities and performances in motion control technology (Moog 2015).
The latest annual report of Moog Inc. 2014 shows that the total sales of the company amount to $1,118 million.
Products
Control of flight actuators using the electromechanical, electrohydrastic, and hydraulic technologies.
The thrust of the engine vector control actuation system
The servo valves flight control
Blade fold, wing fold, and weapons bay actuation system
Multi-axis feel, stabilizer trim controls, and trim systems
Actuator control electronics
The competitive advantages
Highly receptive and centered global aftermarket support organization
Incomparable experience in terms of the engineered secondary and primary control of flight system, both in the United State and in internationally.
Whole actuation system incorporation capacity
The incorporation and the control of flight system
The Space and Defense Control
Moog Inc. provides surveillance portfolio such as accurate positioning systems, rugged cameras. They are online based, which means that they have remotely operated systems that are used for military and commercial purposes. In 2014, Moog Inc collaborated with the U.S State Department through the installation of Moog imaging system in international facilities, which were intended to detect national security threats and terrorists in night-time and low light situations. Moog Inc. provides electromechanical actuation systems control turret that stabilize and aim on air, land, and sea platforms. In addition, Moog Inc. supplies support and hardware for twenty-four launch mediums and over forty-five spacecrafts. The company has the largest development programs, which consist of the Boeing Capture System that is used for the CST-100 and the space launch system (SLS), which is engineered for the flexibility of the cargo and/or crew that will be supported by the international partner transportation and the commercial segment of NASA.
The competitive advantages.
High volume and high quality manufacturing for the control of missile fin
The high consistency supplier of component capable system and prime level of incorporation
The motion and fluid of the control heritage
The Industrial System
The industrial system segment of Moog Inc. consists of equipment for metal forming, plastic machines for motion controls, and steel mills that are high on demand in 2014. The total sale of Moog Inc. in the year 2014 was 591 million USD, together with the sales of industrial automation amounting for 307 million USD. The total revenues of Moog Inc. on the industrial system are expected to increase by 600 million US by 2015. Moog Inc. experience in the manufacturing, supporting, and engineering in their fields is the greatest asset of the company.
The competitive advantages of the industrial system segment
application and design experience of system and products solution for use in the difficult environment
the capability to develop the performance of the machine of the customer with products that are high in quality and motion control solutions
the international organization focused on cooperating with customers
The important sector proficiency in the machine of the customer, challenges in design, and industry application.
Medical Devices
Moog Inc. supplies and manufactures eneteral nutrition and therapy delivery together with a suite of components including the sold products to the OEM manufacturers. Moog Inc. medical total sale accounting for 120 million US and the medical products are delivered to the market by the company’s regional distribution network for the eneteral pumps and IV that were sold in Canada and the United States, on which it permits Moog Inc. to capture new industry and to operate closely with the key accounts. It is expected that Moog Inc. will increase its revenue by 120 million US by 2015.
The Total Net Earnings of Moog Inc. from 2004 to 2014 where in they have increase from 57 million US in 2004 and increased by 158 million US by 2014. The net earnings of the company have increased by 101 million US in 10 years. The total sale of Moog Inc. from 2004 to 2014 on which the sales in 2004 is amounting to 939 million US and increased by 2,648 million US in 2014.
Aircraft Control Segment
Moog Inc. provided a program for the military flight control that is used in the military jet fighter of the United States called F-35 Joint Strike Fighter and the primary and secondary flight control actuators, and controls for cockpits, and the high lift system for the midsized aircraft called the ‘Gulf stream model G280’. It is expected that Moog Inc. will developed a new model and system for the Gulfstream models called the G600 and the G500 with a new flap actuation and drive system, control electronics, as well as the sensor, linkages, and the rudder pedals. Moog Inc. constantly support and provide the largest aircraft aftermarket program called the United States Air Forces C-5M Galaxy modernization program. It is expected that the total revenue for the aircraft controls will be 1.1 billion including the total sales of the aircraft of 563 million US in 2015.
The Financial Performance of Moog Inc. from 2011 to 2014
Consolidated Statements of Cash Flows
The Qualitative and Quantitative Disclosures in regards to the Market Risk
Moog Inc. experienced increase in the rate of interest rate accounting for 549 million USD. In addition, the average borrowings to the variable rates of interest were 474 million USD, hence if the rates of the interest had been higher by one percent, Moog Inc. interest would have been much higher (5 million US) (Moog Inc. 2014).
Methodology
The business report about the acquisition of Moog Inc. by the Embry Investment Group utilizes qualitative research methodology. The qualitative research methodology heavily depends on the linguistic data rather than the numerical data of a study, and it utilizes the meaning based from the interpretation of data rather than using the statistical data, analysis, and research procedure is the most significant characteristics of a qualitative research methodology. The qualitative research characteristics should centre or emphasize in order for the researcher to formulate open ideas for research questions on which it answers and explain the phenomena. The qualitative research methodology considered the complication by integrating the context of the real world which can be gathered from variety of perspectives. Furthermore, it centers on the interpretation and illustration which perhaps lead to the improvement and formulation of new theory or idea, or to an assessment of the process of an organization. The qualitative research has interpretations and numerous constructions of reality that flood and it changes over time. Qualitative research explores the perspectives, behaviors, and experience of the participants. The qualitative research method focuses on the several truths that are socially assembled. The investigator in the qualitative research method seeks to understand the feelings, experience, and thoughts of an individual. The qualitative research can be important during the initial stage of the formulation of concept or emergent themes with a view to understanding the cultural and social aspect of the phenomena. This type of research method is usually used for the enhancement of the qualification during the research principal phase. The process of analyzing the data in qualitative research is through code or organization of the gathered data or known as the data processing, explain the sample population, illustrate the summaries of the data for easy interpretation of the data, draw conclusions, and create strategies for the conformation and experiment of findings. The descriptive method refers to a type of qualitative and quantitative research methodology where it considers the data analysis, design as well as the research question that will be utilize in the given topic. The descriptive research can be in the form of statistical data, graphs, and population (quantitative) and it can be in the form of meanings, symbols, and interpretation. Since the descriptive research possess some part of each the aspects of the research like the quantitative research method in analyzing the solution and strategic solutions. In addition, this type of research is almost certainly can be determined through questions being asked, and to descriptive research the term ‘what’ is frequently used because since this question can be answered through description and observation of the data. The main purpose of the descriptive research is to describe the phenomena in order for the investigators to widen their knowledge on a specific subject matter and broaden the perspective on the gathered data for the explanation on the questions about the complexity of reality. The function of the descriptive research heavily depends on the instrumentation for observation and measurement. The moment the instruments are improved, they can be used to explain the phenomena to the investigators (Elliot et al 2005; Harwell n.d).
References
Elliot, R. & Timulak, L. (2005). Descriptive and Interpretive Approaches to Qualitative
Research [PDF Document]. Retrieved from nideffer website: http://nideffer.net/classes/GCT_RPI_S14/readings/interpretive.pdf
Harwell, M. (n.d). Research Design in Qualitative/Quantitative/Mixed Methods [PDF
Document]. Retrieved from Sage Pub website: http://www.sagepub.com/sites/default/files/upm-binaries/41165_10.pdf
Moog Inc. (2014). Moog Annual Report 2014 [PDF Document]. Retrieved from Moog Inc.
website: http://www.moog.com/literature/Corporate/Investors/Annual_Report/2014/2014_moog_annual_report.pdf
Moog Inc. (2015). Modular Design for Superior Performance Quiet and Robust [PDF
Document]. Retrieved from Moog Inc. website: http://www.moog.com/literature/ICD/Moog-Pumps-RKP-Catalog-en.pdf
Moog Inc. (n.d). Electrohydraulic Valve A Technical Look [PDF Document]. Retrieved from
Moog Inc. website: http://www.moog.com/literature/ICD/Valves-Introduction.pdf
Moog Inc. (2015). Moog Overview. Retrieved from http://www.moog.com/about/
Reuters. (2015). Profile: Moog Inc. (MOGa.N). Retrieved from
http://in.reuters.com/finance/stocks/companyProfile?symbol=MOGa.N
