Triumph Group Annual Report 2008

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FY2008 Annual Report · Triumph Group

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Triumph Group, Inc. | 2008 Annual Report

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One name. Many solutions.

In fiscal 2008, as we marked our 15th anniversary, Triumph set records in every key

performance measure.

(cid:129) Net sales in fiscal 2008 totaled more than $1.15 billion, a 23% increase over

fiscal 2007. Revenues reflected a balanced mix among the key market sectors

of our industry.

(cid:129) Operating income exceeded $126.3 million in fiscal 2008, a 35% increase over

fiscal 2007.

(cid:129) Income from continuing operations grew 49% to $75.7 million, or $4.32 per diluted

share – up from $3.11 per share last year.

(cid:129) During fiscal 2008, Triumph generated $51.1 million of cash flow from operations.

(cid:129) Our balance sheet remains exceptionally strong, with a debt-to-capitalization

ratio of 37%.

(cid:129) Backlog, the value of firm orders under contract for delivery over the next two years,

increased 13% to a record $1.3 billion in fiscal 2008. Our top ten programs measured

by backlog display a balanced mix of commercial and military platforms.

We owe our success to a clear strategic vision and our unique operating philosophy

that values and rewards the many contributions of our operating companies,

employees, suppliers, customers and investors.

Triumph Group, Inc., headquartered in
Wayne, Pennsylvania, is comprised
of 33 highly specialized aerospace
manufacturing and maintenance, repair and
overhaul companies, providing integrated
solutions to the global aerospace market.

Triumph companies design, engineer,
manufacture, repair and overhaul a
broad portfolio of aircraft components,
accessories and assemblies. All companies
share the Triumph name and a common
commitment to integrity, innovation, quality
and service.

Major Markets

Top Ten Platforms
as of March 31, 2008
(based on backlog)

1. Boeing 777

2. Boeing 737 NG

3. Boeing 787

CH-47

UH60

V-22

7. Airbus A320/321

8. Boeing C-17

9. Boeing 747

10. Airbus A380

44% Commercial Aerospace

33% Military

9% Business Jets

9% Non-Aviation

5% Regional Jets

Financial Highlights
(Dollars in thousands, except per share data)

Results for Year:

Sales

Income from Continuing Operations

% of Sales

Income Tax Expense
Interest Expense & Other
Operating Income
% of Sales

Depreciation & Amortization
Earnings before Interest, Taxes, Depreciation & Amortization*

% of Sales

Net Income

% of Sales

Earnings per Share – Diluted:
Income from Continuing Operations
Loss from Discontinued Operations
Net Income

March 08
$1,151,090

75,742
7%
37,161
13,422
$ 126,325
11%
43,215
$ 169,540
15%

67,274
6%

4.32
(0.48)
3.84

March 07
$ 937,327

$ 50,976
5%
26,129
16,794
$ 93,899
10%
35,703
$ 129,602
14%

$ 47,071
5%

March 06
$ 749,368

$ 39,259
5%
11,608
10,304
$ 61,171
8%
30,827
$ 91,998
12%

$ 34,515
5%

3.11
(0.24)
2.87

2.45
(0.30)
2.15

Weighted Shares – Diluted (in thousands)

17,540

16,413

16,060

Capital Expenditures

Year-End Position:
Working Capital
Current Ratio

Property & Equipment at cost
Property & Equipment, net

Debt
Cash
Net Debt
Stockholders’ Equity
Capital
Net Debt to Capital Ratio

Book Value per Common Share

Employees
Sales per Employee

62,368

$ 59,191

$ 27,991

$ 404,180
2.9

$ 515,523
$ 324,095

$ 419,813
13,738
$ 406,075
692,729
$1,098,804
37%

41.94

5,572
207

$ 317,451
2.7

$ 443,575
$ 283,681

$ 316,183
7,243
$ 308,940
627,363
$ 936,303
33%

38.09

5,010
187

$ 256,480
2.6

$ 358,936
$ 225,321

$ 161,417
5,643
$ 155,774
563,703
$ 719,477
22%

35.21

4,034
186

* Management believes that earnings before interest, taxes, depreciation and amortization (“EBITDA”) provides the reader a good measure of cash generated from the operations of the
business before any investment in working capital or fixed assets.

Sales

1
5
1
,
1

7
3
9

9
4
7

Cash Flow from
Operations

1
5

5
4

0
4

EBITDA

Backlog

0
7
1

0
3
1

2
9

8
7
2
,
1

7
2
1
,
1

6
7
8

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Fellow Stockholders:

As we celebrate our 15th anniversary and mark the
achievement of $1 billion in revenues, I am pleased to
report that fiscal 2008 was Triumph’s most successful
year ever. We not only exceeded the results achieved
in fiscal 2007, but also established records in virtually
every important performance measure.

Second is growing demand for rotorcraft for both military
and civilian use. Current U.S. military conflicts around the
world are making extensive use of rotorcraft in extremely
difficult environments. Replacement rates are likely to
remain high for the foreseeable future, even in the
eventual aftermath of these conflicts.

Since Triumph’s inception in 1993, we’ve extended and
expanded our boundaries by acquiring some of the world’s
finest privately-held aerospace companies and have
created an environment where all can thrive together.
We’ve managed Triumph according to a somewhat
unconventional philosophy that places a great deal of
discretion and accountability with our individual companies.
This approach has allowed us to work together to serve
our customers, provide opportunities for our employees
and suppliers, and create value for our investors.

Our philosophy has served us well. By
almost any standard, Triumph has enjoyed
exceptional success throughout our
relatively short history – achieving
compound annual growth of 18% in
revenues and 22% in operating income
over a 15-year time span. Even more
important, we’ve established a foundation
for solid performance in the years ahead.

Industry Outlook

The outlook for our industry is extremely
positive, as build rates remain strong.
Widely-reported production delays in
next-generation aircraft may actually
serve to extend the current build cycle.
This could benefit Triumph by moderating
future fluctuations in aircraft production.

Although the aviation industry is cyclical, the majority of
our business is derived from long-standing customers
with well-established platforms that produce consistent
revenue and income. Triumph continues to build and
maintain our reputation as a trusted and reliable supplier.

Our Aerospace Systems Group is well positioned to
capitalize on a number of emerging industry trends.
First, as the price of jet fuel has doubled in just the past
year, our customers are placing greater emphasis on
technologies able to increase fuel efficiency. Triumph’s
proficiency in both lightweight composite materials and
airframe structures provides an opportunity to work with
our customers to address these important concerns.

Third, demand for light jets for private and commercial
use continues to grow rapidly, as short-distance, niche
markets proliferate. Triumph maintains an active role in
supplying components and services to several key
platforms in this emerging market.

Our Aftermarket Services Group is prepared to meet
additional demand for maintenance, repair and overhaul
(MRO) services as the global commercial fleet ages and
platforms like the 737NG, 777 and the A-320 family all
come off warranty and are placed on standard
maintenance schedules. Airlines and air cargo carriers
continue to perform at high levels, albeit in a highly
competitive marketplace beset by rising fuel prices and
ever-tightening margins.

We expect that recent attention to safety concerns will
drive our customers to focus less on price and more
on quality and performance. As airlines are driven to
adopt more disciplined inspection schedules, Triumph’s
value proposition – founded on safety, reliability and
service – becomes increasingly attractive.

Partners in Performance

As we pass the $1 billion milestone in annual revenues,
I am frequently asked if we plan to change our
operating philosophy and become more centralized to
take greater advantage of our size. This question, while
timely, overlooks the strengths of an approach that has
served our company and all our stakeholders extremely
well through the years.

Our philosophy is successful because it allows us to
act as a large corporation and as a small company at
the same time. While Triumph management establishes
the overall direction for the entire organization, each
individual company has broad latitude and discretion to
apply our strategies in ways that make sense for their
own customers and markets. Because our operating
companies are extremely nimble and responsive to
changing market conditions, Triumph as a whole is also
highly adaptive and flexible.

At the same time, Triumph acts as a large corporation
by presenting a common face and a single point of
contact to our customers. Our companies are able to
share knowledge and collaborate together to meet a
broader range of customer needs than any one
company could serve on its own.

RICHARD C. ILL
President and
Chief Executive Officer

C O R E P H I L O S O P H Y

To protect the integrity of the individual companies
and the products and services they provide,
while offering each company the advantages
of being part of a larger entity.

An evolving fleet and increased fuel costs challenge

commercial aviation as carriers seek

innovative manufacturing and maintenance solutions.

Today’s commercial aviation fleet
faces new demands for greater
efficiency. Triumph’s design and
engineering know-how, along
with our expertise in lightweight
composite materials, allows us to
collaborate with both OEM and
MRO customers to identify cost-
saving opportunities.

C O C K P I T C O N S O L E

C F 6 - 8 0 C 2 R E V E R S E R

C O C K P I T G L A R E S H I E L D

A composite translating sleeve
for the CF6-80C2 reverser is
lighter in weight, does not
corrode and is much easier to
repair than its aluminum
predecessor. The sleeve is
compatible with the 747, 767,
MD-11 and A-300 platforms.

U.S. military conflicts around the world

are making extensive use of rotorcraft

in extremely difficult environments.

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V- 2 2 H Y D R A U L I C S TA R T E R M O T O R

V- 2 2 A C T U AT O R

Demand for both new production
and MRO services has risen
dramatically as rotorcraft
equipment deteriorates due to
heavy utilization in current
military conflicts. Rotorcraft
account for three of Triumph’s
top ten platforms in terms of
backlog.

(Above) The V-22 Osprey
tilt rotor aircraft

Partnerships with Our Companies

The value we create for our customers lies in integrating
outstanding technology and the exceptional know-how
of our people in the service of our customers.

The foundation of our operating philosophy is the
entrepreneurial spirit of our companies. Many of our
companies share a common ancestry that dates back
to the formative years of today’s aerospace industry.
As aircraft manufacturers and airlines were established
throughout the United States, a network of cottage
industries grew up around major aviation hubs to
provide an array of goods and services. Among them
were local specialty manufacturers who saw enormous
potential in this rapidly growing industry.

Managing such a company demanded a special breed
of entrepreneur. It required an investment in both the
latest machinery and tools, and in the talented people
required to run them. Outstanding customer service
wasn’t a goal to which a company aspired; it was a
prerequisite for doing business. Running such a
company required the ability to seek out new business
wherever it might be found, the tenacity to drive a hard
bargain, and an instinct for efficiency that made
frugality a basic fact of day-to-day business.

These fundamental entrepreneurial survival skills are
present in the very core of all the companies that have
joined Triumph through the years. We make every
effort to preserve and leverage these qualities by
emphasizing responsibility and accountability at the
individual company level.

In return, Triumph provides our companies with
advantages they could never enjoy on their own –
access to capital markets, the ability to invest in new
capabilities and increased capacity, access to new
markets and attractive employee benefits. These tools
allow them to compete effectively in today’s highly
competitive marketplace.

Partnerships with Our Employees

Being part of Triumph, our companies are able to
attract and retain the very best people available.
Triumph offers employees an excellent compensation
package that compares favorably with those offered by
larger corporations.

However, some of the most important advantages of
working at Triumph are not measured in dollars and
cents. Many companies talk a great deal about
personal accountability and empowerment. At Triumph,
we actually put these ideas into practice.

Our employees don’t need to request permission to go
the extra mile for a customer – so long as their actions
are anchored in our values of integrity, innovation, quality
and service. Not only are employees empowered to take
the initiative; they are expected to take the initiative.

Likewise, since our 5,600 employees are distributed
among 33 companies, we’re able to maintain close,
personal relationships at each work site. Our people
know one another by name. There’s no multi-level
corporate bureaucracy. When there are problems,
management hears about it first hand. Communication
is direct, personal and timely. Decisions are quickly
translated into results.

Partnerships with Suppliers

Each of our companies regularly augments its own
expertise with the skills and capabilities of a wide range
of suppliers. Indeed, materials and services obtained
from suppliers can account for a significant portion of
product cost and have a major impact on delivery
schedules. Our suppliers are a cornerstone of our
ability to provide world class products and services to
our customers, and are an important key to production
flexibility, warranties, inventory/asset turns and
transportation costs.

Triumph companies work with literally thousands of
suppliers worldwide. All our companies have pooled
their supplier information in a web-based procurement
system. This allows us to request bids for materials
and components from multiple suppliers simultaneously
– with confidence that the supplier has an established
relationship with one of our Triumph companies.

Partnerships with Customers

Triumph’s capabilities are specifically designed for the
needs of today’s aerospace manufacturers and
commercial and military fleets. As the industry moves
toward a business model characterized by outsourcing
entire assemblies and systems – including design,
engineering, manufacturing and repair – Triumph is
ideally positioned to meet these needs as they evolve.

Since 2006, all our companies have shared the
Triumph name and a common commitment to work
together to serve our customers. Indeed, among the
fastest-growing segments of our business are sales
involving two or more Triumph companies working
together to achieve a result that neither could
accomplish on their own.

In February 2008, Triumph
Structures-Long Island, the
former B. & R. Machine &
Tool Corp., joined our
Aerospace Systems Group.
This latest acquisition
enhances Triumph’s ability
to provide state-of-the-art
high-speed machining
processes to our major
airframe customers.

C O R E S T R A T E G I E S

(cid:129) Continually add products and services.
(cid:129) Expand operating capacity.
(cid:129) Acquire aggressively.
(cid:129) Market our complete portfolio of capabilities.
(cid:129) Expand internationally.

To meet our customers’ needs, we assemble project
teams that draw on the expertise of all Triumph
companies as required – all through a single point of
contact. The Triumph project team becomes, in effect,
an ad hoc enterprise specifically designed and solely
dedicated to meeting the customer’s requirements. The
team provides a comprehensive systems solution,
integrating procurement, design, engineering,
manufacturing and assembly – including on-site
support at a customer’s location when required.

Likewise, our Group marketing capabilities allow
Triumph to cross-sell the products and services of
individual companies to our entire customer base. Our
companies gain access to new markets, while
customers benefit from the ability to meet more of their
needs from a single source. This allows them to reduce
their number of suppliers and increase efficiency.

Similarly, air carriers are able to bundle complete
packages of maintenance and repair services, drawing
on the capabilities and services of all our Aftermarket
Services companies through a single point of contact.
In addition, Triumph offers customers a range of
inventory and asset management services that no
individual company could provide on its own. These
capabilities now extend to the Asian market through
Triumph’s MRO facility in Bangkok, Thailand.

Partnerships with Investors

There has never been any confusion that the mission of
the Triumph Group is to enhance shareholder value.
Just as the consistency of our operating philosophy
and business strategy has defined our relationships
with our companies, our employees, our suppliers and
our customers, it has been the driving force in our
partnership with investors as well.

That’s why we manage Triumph to protect the financial
integrity of our company at all times – regardless of
external events, the state of the economy, or the overall
health of the aerospace industry.

(cid:129) We operate as a decentralized alliance of operating

companies, where the management of each Triumph
company is accountable for achieving excellent
financial performance. Each company is responsible
for its own contribution to Triumph’s results.

(cid:129) We value the agility that comes from few

management layers, close customer relationships
and hands-on attention to detail. At the same time,
we leverage the Triumph brand and approach our
customers through a single point of contact as one
company offering many solutions.

(cid:129) Triumph maintains a diversified mix of customers
throughout the aerospace industry. No single
market sector, company or platform dominates
our business. The vast majority of our business is
devoted to long-established platforms which
produce steady, consistent earnings.

(cid:129) We maintain a strong balance sheet that minimizes

risk and allows us to take advantage of opportunities
as they arise. In fiscal 2008, for example, we
took action to buy back stock in order to enhance
shareholder return.

(cid:129) We value and respect our employees, because we

fully understand that they represent the real strength
of our company. It is their expertise and know-how
that creates value for our customers and ultimately
for our investors.

Looking to the Future

Triumph’s business strategy and decentralized
operating philosophy have served us well for 15 years.
They have given us the ability to adapt and change to
meet the needs of a rapidly evolving marketplace.

Few industries have witnessed the degree of change
we’ve seen in aerospace manufacturing, air travel and
air freight. Who would have predicted that today two
giant companies would dominate the global aerospace
industry? Who saw the looming challenges of
globalization? Who could have forecast the 9/11
disaster and its effects on air travel? Who knew that
the cost of aviation fuel would skyrocket beyond all
expectations? Who would have confidently predicted
an industry operating at near-full-capacity in a difficult
and volatile economy?

Triumph’s unique alliance of companies has provided
solutions to address the ongoing and continuing
challenges in our industry. I have no doubt that 15
years from now we’ll look back at an entirely different,
equally unpredictable set of questions. I also have no
doubt that the people and companies of the Triumph
Group will continue to find the answers.

To our investors. To our customers. To our suppliers.
To our employees.

Thank you.

RICHARD C. ILL
President and Chief Executive Officer

Demand for light jets for private and

commercial use continues to grow rapidly.

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As major airlines focus on
longer, established routes, a new
generation of affordable light jets
provides the flexibility to reach
virtually any destination. Triumph
provides parts and components
for a number of platforms in this
emerging market.

M A I N L A N D I N G G E A R

Triumph collaborated with Cirrus
Design Corporation in the design
and manufacture of both the
nose and main landing gear
assemblies for “The-Jet”, a new-
generation personal jet aircraft.

N O S E L A N D I N G G E A R

Company Directory

Triumph Aerospace Systems –

Seattle

System engineering and integration for
landing gear, hydraulic, deployment, cargo
door and electromechanical type systems.
Capabilities include design, analysis and
testing to support these types of systems
and components.
Don P. Fowler, President
E-mail: dfowler@triumphgroup.com
Phone: 425-636-9001
Redmond, Washington

Triumph Aerospace Systems –

Wichita

Designs and manufactures aircraft
windows, sheet metal assemblies (wing
spars and leading edges), pilot/co-pilot
control wheels, cockpit sunvisors and
structural composite parts for the
aerospace industry.
James E. Lee, President
E-mail: jlee@triumphgroup.com
Phone: 800-379-6840
Wichita, Kansas

Triumph Composite Systems
Manufactures interior non-structural
composites for the aviation industry,
including environmental control system
ducting, floor panels, aisle stands
and glareshields.
Timothy A. Stevens, President
E-mail: tstevens@triumphgroup.com
Phone: 509-623-8100
Spokane, Washington

Triumph Controls
Designs and manufactures mechanical
and electromechanical control systems.
William Bernardo, President
E-mail: bbernardo@triumphgroup.com
Phone: 215-699-4861
North Wales, Pennsylvania
Phone: 317-421-8760
Shelbyville, Indiana

Triumph Fabrications – Fort Worth
Manufactures metallic/composite bonded
components and assemblies.
M. Anthony Johnson, President
E-mail: tjohnson@triumphgroup.com
Phone: 817-451-0620
Fort Worth, Texas

Triumph Fabrications – Hot Springs
Produces complex sheet metal parts and
assemblies, titanium hot forming,
metallic/composite bonding and performs
chem-milling and other metal finishing
processes.
M. Anthony Johnson, President
E-mail: tjohnson@triumphgroup.com
Phone: 501-321-9325
Hot Springs, Arkansas

Triumph Fabrications – Shelbyville
Produces aircraft fuselage skins, leading
edges and web assemblies through the
stretch forming of sheet, extrusion, rolled
shape and light plate metals.
Donald E. Kendall, President
E-mail: dkendall@triumphgroup.com
Phone: 317-398-6684
Shelbyville, Indiana

Triumph Fabrications – San Diego
Triumph Fabrications – Phoenix
Produces complex welded and riveted
sheet metal assemblies for aerospace
applications. Components include exhaust
systems, ducting, doors, panels, control
surfaces and engine components.
Mark Gobin, President
E-mail: mgobin@triumphgroup.com
Phone: 619-440-2504
El Cajon, California
Phone: 480-449-5820
Chandler, Arizona

Triumph Gear Systems – Park City
Triumph Gear Systems – Macomb
Specializes in the design, development,
manufacture, sale and repair of gearboxes,
high-lift flight control actuators,
gear-driven actuators and gears for
the aerospace industry.
Carla Bowman, President
E-mail: cbowman@triumphgroup.com
Phone: 586-781-2800
Macomb, Michigan
Phone: 435-649-1900
Park City, Utah

Triumph Northwest
Machines and fabricates refractory,
reactive, heat and corrosion-resistant
precision products.
Clyde Forrest, President
E-mail: cforrest@triumphgroup.com
Phone: 541-926-5517
Albany, Oregon

Triumph Processing
Provides high-quality finishing services to
the aerospace, military and commercial
industries.
Peter J. LaBarbera, President
E-mail: plabarbera@triumphgroup.com
Phone: 323-563-1338
Lynwood, California

Triumph Structures – Kansas City
Manufactures precision machined parts
and mechanical assemblies for the
aviation, aerospace and defense industries.
David Soper, President
E-mail: dsoper@triumphgroup.com
Phone: 816-763-8600
Grandview, Missouri

Triumph Structures – Long Island
Manufactures high quality structural
and dynamic parts and assemblies for
commercial and military aerospace
programs.
Lenny Gross, President
E-mail: lgross@triumphgroup.com
Phone: 516-997-5757
Westbury, New York

Triumph Structures – Los Angeles
Manufactures long structural components
such as stringers, cords, floor beams and
spars for the aviation industry. Machines,
welds and assembles large complex
precision structural components.
Kevin Dahlin, President
E-mail: kdahlin@triumphgroup.com
Phone: 626-965-1630
City of Industry, California
Phone: 818-341-1314
Chatsworth, California
Phone: 626-965-1630
Walnut, California

Triumph Structures – Wichita
Specializes in complex, high speed
monolithic precision machining, turning,
subassemblies and sheet metal
fabrication, serving domestic and
international aerospace customers.
Phone: 316-942-0432
Wichita, Kansas

Triumph Thermal Systems
Designs, manufactures and repairs aircraft
thermal transfer components and systems.
Michael Perhay, President
E-mail: mperhay@triumphgroup.com
Phone: 419-273-2511
Forest, Ohio

Triumph Aftermarket
Services Group
John Brasch, Group President
Phone: 602-659-7301
E-mail: jbrasch@triumphgroup.com
Mike Abram, Senior Vice President
Phone: 501-262-1555
E-mail: mabram@triumphgroup.com

Triumph Accessory Services –

Wellington

Provides maintenance services for aircraft
heavy accessories and airborne electrical
power generation devices, including
constant speed drives, integrated drive
generators, air cycle machines and
electrical generators.
Robert Bierk, President
E-mail: bbierk@triumphgroup.com
Phone: 620-326-2235
Wellington, Kansas
Phone: 414-543-5604
Milwaukee, Wisconsin

Triumph Accessory Services –

Grand Prairie

Provides maintenance services for engine
and airframe accessories including a
variety of engine gearboxes, pneumatic
starters, valves and drive units, hydraulic
actuators, lube system pumps, fuel
nozzles, fuel pumps and fuel controls.
Kevin Murphy, President
E-mail: kmurphy@triumphgroup.com
Phone: 972-641-4677
Grand Prairie, Texas

Triumph Air Repair
Repairs and overhauls auxiliary power
units (APUs) and related accessories.
John Jenson, President
E-mail: jjenson@triumphgroup.com
Phone: 602-437-1144
Phoenix, Arizona

Triumph Airborne Structures
Repairs and overhauls fan reversers,
nacelle components, flight control surfaces
and other aerostructures.
Mike Abram, President
E-mail: mabram@triumphgroup.com
Phone: 501-262-1555
Hot Springs, Arkansas

Triumph Aviation Services – Asia
Repairs and overhauls complex aircraft
operational components, such as auxiliary
power units (APUs), nacelles, constant
speed drives, fan reversers and related
accessories.
Remy Maitam, President
E-mail: rmaitam@triumphgroup.com
Phone: 011 66 38 465 070
Chonburi, Thailand

Triumph Engines – Tempe
Designs, engineers, manufactures, repairs
and overhauls aftermarket aerospace gas
turbine engine components and provides
repair services and aftermarket parts and
services to aircraft operators, maintenance
providers and third-party overhaul facilities.
Elizabeth Rakestraw, President
E-mail: erakestraw@triumphgroup.com
Phone: 602-438-8760
Tempe, Arizona

Triumph Instruments –

Burbank

Repairs and overhauls aircraft
instrumentation, power systems and
avionics. Distributes and repairs aircraft
smoke detectors and industrial
instrumentation.
Robert Bierk, President
E-mail: bbierk@triumphgroup.com
Phone: 818-246-8431
Burbank, California

Triumph Instruments –
Ft. Lauderdale
Triumph Instruments –

Austin

Specializes in the repair, overhaul and
exchange of electromechanical and
pneumatic aircraft instruments.
David G. Vorsas, President
E-mail: dvorsas@triumphgroup.com
Phone: 954-772-4559
Fort Lauderdale, Florida
Phone: 512-218-1900
Austin, Texas

Triumph Interiors
Refurbishes and repairs aircraft interiors
such as sidewalls, ceiling panels, galleys
and overhead storage bins and
manufactures a full line of PMA interior
lighting and plastic components.
Mike Abram, President
E-mail: mabram@triumphgroup.com
Phone: 412-788-4200
Oakdale, Pennsylvania
Phone: 972-623-3344
Grand Prairie, Texas
Phone: 011 35 361 472711
Shannon, Ireland

Triumph Logistics
Provides distribution, exchange and lease
programs for auxiliary power units (APUs),
APU components and other components
supported by Triumph Group Companies.
Lee R. Jacobs, President
E-mail: ljacobs@triumphgroup.com
Phone: 602-470-7226
Phoenix, Arizona
Phone: 011 44 1256 337640
Basingstoke, England

Triumph San Antonio
Support Center

Provides maintenance services for aircraft
ground support equipment.
Robert Bierk, President
E-mail: bbierk@triumphgroup.com
Phone: 210-932-6700
San Antonio, Texas

Triumph Aerospace
Systems Group
Jeffry D. Frisby, Group President
Phone: 336-766-9036
E-mail: jfrisby@triumphgroup.com

Construction Brevetees
d’Alfortville (C.B.A.)

Manufactures mechanical ball bearing
control assemblies for the aerospace,
ground transportation, defense and
marine industries.
Michel Pommey, President
E-mail: mpommey@triumphgroup.com
Phone: 011 33 1 4375 2053
Alfortville, France

Triumph Actuation Systems –

Clemmons

Triumph Actuation Systems –

Freeport

Designs, manufactures and repairs
complex hydraulic and hydromechanical
aircraft components and systems, such as
variable displacement pumps and motors,
linear actuators and valves and cargo
door actuation systems.
Richard Reed, President
E-mail: rreed@triumphgroup.com
Phone: 336-766-9036
Clemmons, North Carolina
Phone: 516-378-0162
Freeport, New York

Triumph Actuation Systems –

Connecticut

Designs, manufactures and repairs
complex hydraulic, hydromechanical and
mechanical components and systems,
such as nose wheel steering motors,
helicopter blade lag dampers, mechanical
hold-open rods, coupling and latching
devices, as well as mechanical and
electromechanical actuation products.
Thomas Holzthum, President
E-mail: tholzthum@triumphgroup.com
Phone: 860-242-5568
Bloomfield, Connecticut
Phone: 860-739-4926
East Lyme, Connecticut
Phone: 203-748-0027
Bethel, Connecticut

Triumph Actuation Systems –

Valencia

Designs, manufactures and repairs complex
hydraulic and hydromechanical aircraft
components and systems, such
as accumulators, actuators, complex
valve packages and landing gear
retract actuators.
Lea Black, President
E-mail: lblack@triumphgroup.com
Phone: 661-295-1015
Valencia, California

Triumph Aerospace Systems –

Newport News

Offers a fully integrated range of
capabilities, including systems engineering,
conceptual engineering, mechanical design
and analysis, prototype and limited-rate
production, instrumentation assembly and
testing services and complex structural
composite design and manufacturing.
Bill Jacobson, President
E-mail: wjacobson@triumphgroup.com
Phone: 757-873-1344
Newport News, Virginia

Corporate Officers & Directors

Executive Officers
RICHARD C. ILL
President and Chief Executive Officer

M. DAVID KORNBLATT
Senior Vice President,
Chief Financial Officer and Treasurer

JOHN B. WRIGHT, II
Vice President,
General Counsel and Secretary

KEVIN E. KINDIG
Vice President and Controller

SHEILA G. SPAGNOLO
Vice President,
Tax and Investor Relations

Shareholder Information

Triumph Group, Inc.
Corporate Headquarters
1550 Liberty Ridge Drive
Suite 100
Wayne, PA 19087
610-251-1000
www.triumphgroup.com

Annual Meeting
July 24, 2008, 9:00 am
Millenium Hilton, 55 Church Street,
New York, NY 10007

Financial Information
A copy of the Company’s Form 10-K
filed with the Securities and Exchange
Commission may be obtained without
charge upon written request. Requests for
Triumph Group, Inc.’s 10-K or other
shareholder inquiries should be directed to:
Sheila G. Spagnolo
Vice President, Tax and Investor Relations
Triumph Group, Inc.
1550 Liberty Ridge Drive, Suite 100
Wayne, PA 19087
610-251-1000

Directors
WILLIAM O. ALBERTINI
Executive Vice President,
Chief Financial Officer
Bell Atlantic Global Wireless, Inc. (Retired)

RICHARD C. GOZON
Executive Vice President
Weyerhaeuser Company (Retired)

RICHARD C. ILL
President and Chief Executive Officer
Triumph Group, Inc.

CLAUDE F. KRONK
Vice Chairman and Director
J&L Specialty Steel, Inc. (Retired)

GEORGE SIMPSON
Chief Executive Officer
Marconi, PLC (Retired)

TERRY D. STINSON
(Not standing for election)
President and CEO
Stinson Consulting LLC
Group Vice President
AAR Corp.

Fiscal 2008 Stock Prices
Per Common Share
$86.38
High
$48.25
Low
$56.93
Year-End

Common Stock
Triumph Group, Inc. Common Stock
is listed on the NYSE.
Ticker symbol: TGI

Independent Auditors
Ernst & Young LLP
2001 Market Street
Suite 4000
Philadelphia, PA 19103

Transfer Agent
National City Bank
Corporate Trust Operations
P.O. Box 92301
Cleveland, OH 44193-0900
888-843-5542
E-mail: shareholder.inquiries@nationalcity.com

Equal Opportunity at Triumph
Triumph Group, Inc. is committed to
providing equal opportunities in the
workplace.

Forward–Looking Statements
In accordance with the safe harbor
provisions of the Private Securities Litigation
Reform Act of 1995, the Company notes
that certain statements contained in this
report are forward-looking in nature. These
forward-looking statements include matters
such as our expectations for our industry,
our markets, our Company’s business
strategy and potential and other future-
oriented matters. Such matters inherently
involve many risks and uncertainties that
may cause actual results to differ materially
from expected results. For additional
information, please refer to the Company’s
Securities and Exchange Commission filings
including its Form 10-K for the year ended
March 31, 2008.

Certifications
The certifications by the Chief Executive
Officer and Chief Financial Officer of Triumph
Group, Inc. required under Section 302 of
the Sarbanes-Oxley Act of 2002 have been
filed as exhibits to Triumph Group, Inc.’s
2008 Annual Report on Form 10-K. In
addition, in August 2007, the Chief Executive
Officer of Triumph Group, Inc. certified to the
New York Stock Exchange (“NYSE”) that he
is not aware of any violation by the Company
of NYSE corporate governance listing
standards, as required by Section 303A.12(a)
of the NYSE Corporate Governance Rules.

Triumph Group, Inc.

1550 Liberty Ridge Drive
Suite 100
Wayne, PA 19087

610-251-1000
www.triumphgroup.com

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Mark One)

FORM 10-K

(cid:1) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2008

(cid:2) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission File No. 1-12235

Triumph Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)

51-0347963
(I.R.S. Employer Identification Number)

1550 Liberty Ridge Drive, Suite 100, Wayne, Pennsylvania 19087
(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (610) 251-1000

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

Common Stock, par value $.001 per share
(Title of each class)

New York Stock Exchange
(Name of each exchange on which registered)

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities

Act. Yes (cid:1) No (cid:2)

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Securities

Exchange Act of 1934. Yes (cid:2) No (cid:1)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes (cid:1) No (cid:2)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will

not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K. (cid:2)

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller

reporting company. See definitions of ‘‘large accelerated filer,’’ ‘‘accelerated filer,’’ and ‘‘smaller reporting company’’ in Rule 12b-2 of
the Exchange Act. (Check one):
Large accelerated filer (cid:1) Accelerated filer (cid:2) Non-accelerated filer (cid:2) Smaller reporting company (cid:2)

(Do not check if a
smaller reporting
company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of

1934). Yes (cid:2) No (cid:1)

As of September 30, 2007, the aggregate market value of the shares of Common Stock held by non-affiliates of the Registrant was

approximately $1.3 billion. Such aggregate market value was computed by reference to the closing price of the Common Stock as
reported on the New York Stock Exchange on September 30, 2007. For purposes of making this calculation only, the Registrant has
defined affiliates as including all directors and executive officers.

The number of outstanding shares of the Registrant’s Common Stock, par value $.001 per share, on April 30, 2008 was 16,522,874.

Portions of the following document are incorporated herein by reference:

Documents Incorporated by Reference

The Proxy Statement of Triumph Group, Inc. to be filed in connection with our 2008 Annual Meeting of Stockholders is

incorporated in part in Part III hereof, as specified herein.

Item No.

Page

Table of Contents

PART I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1.
General
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Products and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proprietary Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Raw Materials and Replacement Parts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating Locations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales, Marketing and Engineering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Backlog . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
United States and International Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Government Regulation and Industry Oversight
. . . . . . . . . . . . . . . . . . . . . . . . . .
Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Research and Development Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Executive Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Available Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1A. Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1B. Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 2.
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 3.
Submission of Matters to a Vote of Security Holders . . . . . . . . . . . . . . . . . . . . . . .
Item 4.

PART II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer

Item 6.
Item 7.

Purchases of Equity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Management’s Discussion and Analysis of Financial Condition and Results of

Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 7A. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . .
Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 8.
Changes in and Disagreements With Accountants on Accounting and Financial
Item 9.

Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 9A. Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 9B. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PART III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . .
Item 10.
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 11.
Security Ownership of Certain Beneficial Owners and Management and Related
Item 12.

Item 13.
Item 14.

Stockholder Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain Relationships and Related Transactions, and Director Independence . . . . . .
Principal Accounting Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PART IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exhibits, Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 15.

3
3
3
3
4
5
6
14
14
15
15
15
16
17
17
17
18
18
22
22
23
24

25
27

28
42
43

80
80
83

83
83
83

84
84
84

84
84

Item 1. Business

PART I

This report contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 relating to our future operations and prospects, including statements
that are based on current projections and expectations about the markets in which we operate, and
management’s beliefs concerning future performance and capital requirements based upon current
available information. Actual results could differ materially from management’s current expectations.
Additional capital may be required and, if so, may not be available on reasonable terms, if at all, at the
times and in the amounts we need. In addition to these factors and others described elsewhere in this
report, other factors that could cause actual results to differ materially include competitive and cyclical
factors relating to the aerospace industry, dependence of some of our businesses on key customers,
requirements of capital, product liabilities in excess of insurance, uncertainties relating to the
integration of acquired businesses, general economic conditions affecting our business segment,
technological developments, limited availability of raw materials or skilled personnel, changes in
governmental regulation and oversight and international hostilities and terrorism. For a more detailed
discussion of these and other factors affecting us, see the Risk Factors described in Item 1A of this
Annual Report on Form 10-K. We do not undertake any obligation to revise these forward-looking
statements to reflect future events.

General

Triumph Group, Inc. (‘‘Triumph’’ or the ‘‘Company’’) was incorporated in 1993 in Delaware. Our
companies design, engineer, manufacture, repair, overhaul and distribute aircraft components, such as
hydraulic, mechanical and electromechanical control systems, aircraft and engine accessories, structural
components and assemblies, non-structural composite components, auxiliary power units, or APUs,
avionics and aircraft instruments. We serve a broad spectrum of the aerospace industry, including
original equipment manufacturers, or OEMs, of commercial, regional, business and military aircraft and
components, as well as commercial airlines and air cargo carriers.

Products and Services

We offer a variety of products and services to the aerospace industry through two groups of
operating businesses: (i) Triumph Aerospace Systems Group, whose companies design, engineer and
manufacture a wide range of proprietary and build-to-print components, assemblies and systems for the
global aerospace OEM market; and (ii) Triumph Aftermarket Services Group, whose companies serve
aircraft fleets, notably commercial airlines, the U.S. military and cargo carriers, through the
maintenance, repair and overhaul of aircraft components and accessories manufactured by third parties.

Our Aerospace Systems Group consists of companies that service the full spectrum of aerospace

customers, which include aerospace OEMs and the top-tier manufacturers who supply them and
airlines, air cargo carriers, and domestic and foreign militaries. This group utilizes its capabilities to
design, engineer and build complete mechanical, electromechanical and hydraulic systems, while
continuing to broaden the scope of detailed parts and assemblies that we supply to the aerospace
market. Customers typically return such systems to us for repairs and overhauls and spare parts. This
group also includes companies performing complex manufacturing, machining and forming processes
for a full range of structural components, as well as complete assemblies and subassemblies.

The products that companies within this group design, engineer, build and repair include:

(cid:127) Main engine gear box assemblies

(cid:127) High lift actuation

(cid:127) Hydraulic systems

(cid:127) Landing gear actuation systems

(cid:127) Primary and secondary flight control systems

(cid:127) Thermal management systems

(cid:127) Wing spars and stringers

(cid:127) Stretch-formed leading edges and fuselage skins

(cid:127) Formed structural sheet metal components

(cid:127) Monolithic floors, bulkheads and frames

(cid:127) Floor beams

(cid:127) Landing gear components and assemblies

(cid:127) Complex composite structures

(cid:127) Composite floor panels, environmental control system ducting and non-structural composite

flight deck and other interior components

(cid:127) Bonded components

Our Aftermarket Services Group serves a diverse group of customers which includes airlines, air
cargo carriers, domestic and foreign militaries and third-party repair and overhaul providers. This group
operates one of the world’s largest independent APU repair and overhaul business and endeavors to be
the vendor of choice for airborne structures, airframe and main engine accessories and component
repair and overhaul to our customers as they continue to consolidate vendors. We will also continue to
develop Federal Aviation Administration, or FAA, approved Designated Engineering Representative, or
DER, and Special Federal Aviation Regulation 36, or SFAR 36, proprietary repair procedures for the
components we repair and overhaul. Companies in our aftermarket services group repair and overhaul
various components for the aviation industry including:

(cid:127) APUs

(cid:127) Nacelles, thrust reversers and flight control surfaces

(cid:127) Engine accessories, including main engine fuel pumps

(cid:127) Constant speed drives, integrated drive generators and air-cycle machines

(cid:127) Cockpit instrumentation

(cid:127) Interior sidewalls, ceiling panels and overhead bins

(cid:127) Ground support equipment

Certain financial information about our two segments can be found in Note 18 of ‘‘Notes to

Consolidated Financial Statements.’’

Proprietary Rights

We benefit from our proprietary rights relating to designs, engineering and manufacturing

processes and repair and overhaul procedures. For some products, our unique manufacturing
capabilities are required by the customer’s specifications or designs, thereby necessitating reliance on us
for the production of such specially designed products. We also hold two SFAR 36 certifications that
permit us to develop proprietary repair procedures to be used in some repair and overhaul processes.

We view our name and mark as significant to our business as a whole. Our products are protected

by a portfolio of patents, trademarks, licenses or other forms of intellectual property that expire at
various dates in the future. We develop and acquire new intellectual property on an ongoing basis and
consider all of our intellectual property to be valuable. However, based on the broad scope of our
product lines, management believes that the loss or expiration of any single intellectual property right
would not have a material effect on our results of operations, our financial position or our business
segments. Our policy is to file applications and obtain patents for our new products as appropriate,
including product modifications and improvements. While patents generally expire 20 years after the
patent application filing date, new patents are issued to us on a regular basis.

In our overhaul and repair businesses, OEMs of equipment that we maintain for our customers
increasingly include language in repair manuals that relate to their equipment asserting broad claims of
proprietary rights to the contents of the manuals used in our operations. There can be no assurance
that OEMs will not try to enforce such claims including the possible use of legal proceedings. In the
event of such legal proceedings, there can be no assurance that such actions against the Company will
be unsuccessful. However, we believe that our use of manufacture and repair manuals is lawful.

Raw Materials and Replacement Parts

We purchase raw materials, primarily consisting of extrusions, forgings, castings, aluminum and

titanium sheets and shapes, from various vendors. We also purchase replacement parts which are
utilized in our various repair and overhaul operations. We believe that the availability of raw materials
to us is adequate to support our operations.

Operating Locations

We conduct our business through operating companies and divisions. The following chart describes

the operations, customer base and certain other information with respect to our principal operating
locations at April 30, 2008:

Operation

Subsidiary

TRIUMPH AEROSPACE SYSTEMS GROUP

Construction
Brevetees
d’Alfortville

Construction
Brevetees
d’Alfortville SAS

Operating
Location

Business

Type of Customers

Alfortville, France Manufactures

Triumph Actuation
Systems—
Clemmons(1)

Triumph
Actuation
Systems, LLC

Clemmons, NC

Triumph Actuation
Systems—
Freeport(1)

Freeport, NY

Triumph Actuation
Systems—
Connecticut

Triumph
Actuation
Systems—
Connecticut, LLC

Bloomfield, CT
East Lyme, CT
Bethel, CT

Triumph Actuation
Systems—
Valencia(1)

Triumph
Actuation
Systems—
Valencia, Inc.

Valencia, CA

Number of
Employees

268

147

Commercial and
Military OEMs,
Ground
Transportation and
Marine OEMs.

Commercial, General
Aviation, and Military
OEMs; Commercial
Airlines, General
Aviation and Military
Aftermarket.

Commercial, General
Aviation, and Military
OEMs; Military
Aftermarket.

Commercial, General
Aviation, and Military
OEMs.

236

mechanical ball
bearing control
assemblies for the
aerospace, ground
transportation,
defense and marine
industries.

Designs, manufactures
and repairs complex
hydraulic and
hydromechanical
aircraft components
and systems, such as
accumulators,
actuators, complex
valve packages, and
landing gear retract
actuators.

Business

Type of Customers

Commercial and
Military OEMs;
Commercial and
Military Aftermarket.

Number of
Employees

144

Operation

Subsidiary

Triumph Aerospace
Systems—Newport
News

Triumph
Aerospace
Systems—
Newport
News, Inc.

Operating
Location

Newport News,
VA
San Diego, CA
Huntsville, AL
New Haven, CT

Triumph Aerospace
Systems—Seattle

Triumph
Actuation
Systems—
Connecticut, LLC

Redmond, WA
Rochester, NY

Triumph Aerospace
Systems—
Wichita(1)

Triumph
Aerospace
Systems—
Wichita, Inc.

Wichita, KS

Triumph Composite
Systems

Triumph
Composite
Systems, Inc.

Spokane, WA

Triumph Controls(1)

Triumph
Controls, LLC

North Wales, PA
Shelbyville, IN

Offers a fully
integrated range of
capabilities, including
systems engineering,
conceptual
engineering,
mechanical design and
analysis,
prototype and
limited-rate
production, and
instrumentation
assembly and testing
services and complex
structural composite
design and
manufacturing.

System engineering
and integration for
landing gear,
hydraulic, deployment,
cargo door and
electro-mechanical
type systems.
Capabilities include
design, analysis and
testing to support
these types of systems
and components.

Designs and
manufactures aircraft
windows, sheet metal
assemblies (wing spars
and leading edges),
pilot/co-pilot control
wheels, cockpit sun
visors, and structural
composite parts for
the aerospace
industry.

Manufactures interior
non-structural
composites for the
aviation industry,
including
environmental control
system ducting, floor
panels, aisle stands
and glareshields.

Designs and
manufactures
mechanical and
electromechanical
control systems.

Commercial, General
Aviation and Military
OEMs.

Commercial and
General Aviation
OEMs; General
Aviation Aftermarket.

Commercial, General
Aviation, and Military
OEMs; Commercial
Aftermarket.

Commercial, General
Aviation and Military
OEMs and
Aftermarket.

175

577

170

Operation

Subsidiary

Triumph
Fabrications—Fort
Worth(1)

Triumph
Fabrication—
Fort Worth, Inc.

Triumph
Fabrications—Hot
Springs

Triumph
Fabrications—
Hot
Springs, Inc.

Operating
Location

Fort Worth, TX

Hot Springs, AR

Triumph
Fabrications—
Shelbyville

The Triumph
Group
Operations, Inc.

Shelbyville, IN

Triumph
Fabrications—
San Diego(1)

Triumph
Fabrications—
San Diego, Inc.

El Cajon, CA

Triumph
Fabrications—
Phoenix

Triumph
Engineered
Solutions, Inc.

Chandler, AZ

Number of
Employees

170

382

153

218

Business

Type of Customers

Commercial, General
Aviation and Military
OEMs and
Aftermarket.

Commercial, General
Aviation and Military
OEMs.

Manufactures
metallic/composite
bonded components
and assemblies.

Produces complex
sheet metal parts and
assemblies, titanium
hot forming, and
performs chem-milling
and other metal
finishing processes.

Produces aircraft
fuselage skins, leading
edges and web
assemblies through
the stretch forming of
sheet, extrusion,
rolled shape and light
plate metals.

Produces complex
welded and riveted
sheet metal
assemblies for
aerospace
applications.
Components include
exhaust systems,
ducting, doors, panels,
control surfaces and
engine components.

Operation

Subsidiary

Triumph Gear
Systems—Park City(1)

Triumph Gear
Systems, Inc.

Triumph Gear
Systems—Macomb(1)

Triumph Gear
Systems—
Macomb, Inc.

Operating
Location

Park City, UT

Macomb, MI

Triumph Northwest

The Triumph
Group
Operations, Inc.

Albany, OR

Triumph Processing

Triumph
Processing, Inc.

Lynwood, CA

Triumph Structures— Triumph
Kansas City

Structures—
Kansas
City, Inc.

Grandview, MO

Westbury, NY

Triumph Structures— Triumph
Long Island

Structures—
Long
Island, LLC
(formerly B. &
R. Machine &
Tool Corp.)

Number of
Employees

442

105

152

124

Business

Type of Customers

Commercial and
Military OEMs and
Aftermarket.

Military, Medical and
Electronic OEMs.

Commercial, General
Aviation, and Military
OEMs.

Commercial and
Military OEMs.

Specializes in the
design, development,
manufacture, sale and
repair of gearboxes,
high-lift flight control
actuators, gear-driven
actuators and gears
for the aerospace
industry.

Machines and
fabricates refractory,
reactive, heat and
corrosion-resistant
precision products.

Provides high-quality
finishing services to
the aerospace,
military and
commercial industries.

Manufactures
precision machined
parts and mechanical
assemblies for the
aviation, aerospace
and defense
industries.

Manufactures high
quality structural and
dynamic parts and
assemblies for
commercial and
military aerospace
programs.

Operation

Subsidiary

Triumph
Structures—
Los Angeles

Triumph
Structures—
Los
Angeles, Inc.

Operating
Location

Chatsworth, CA
City of Industry,
CA
Walnut, CA

Triumph Structures— Triumph
Wichita

Structures—
Wichita, Inc.

Wichita, KS

Triumph Thermal
Systems(1)

Triumph
Thermal
Systems, Inc.

Forest, OH

Business

Type of Customers

Commercial, General
Aviation and Military
OEMs.

Number of
Employees

342

Commercial and
Military OEMs.

186

Commercial, General
Aviation and Military
OEMs.

179

Manufactures long
structural
components, such as
stringers, cords, floor
beams and spars for
the aviation industry.
Machines, welds and
assembles large
complex precision
structural
components.

Specializes in
complex, high speed
monolithic precision
machining, turning,
subassemblies, and
sheet metal
fabrication, serving
domestic and
international
aerospace customers.

Designs, manufactures
and repairs aircraft
thermal transfer
components and
systems.

Operation

Subsidiary

TRIUMPH AFTERMARKET SERVICES GROUP

Operating
Location

Triumph Accessory
Services—
Wellington(1)(2)

The Triumph
Group
Operations, Inc.

Wellington, KS
Milwaukee, WI

Triumph Accessory
Services—Grand
Prairie(1)

Triumph
Accessory
Services—Grand
Prairie, Inc.

Grand Prairie,
TX

Triumph Air
Repair(1)(2)

Triumph Airborne
Structures(1)

The Triumph
Group
Operations, Inc.

Triumph
Airborne
Structures, Inc.

Phoenix, AZ

Hot Springs, AR

Business

Type of Customers

Number of
Employees

129

Commercial, General
Aviation and Military
Aftermarket.

Commercial and
Military Aftermarket.

Commercial, General
Aviation and Military
Aftermarket.

Commercial
Aftermarket.

214

133

Provides maintenance
services for engine
and air frame
accessories including a
variety of engine
gearboxes, pneumatic
starters, valves and
drive units, hydraulic
actuators, lube system
pumps, fuel nozzles,
fuel pumps and fuel
controls.

Repairs and overhauls
auxiliary power units
(APUs) and related
accessories.

Repairs and overhauls
fan reversers, nacelle
components, flight
control surfaces and
other aerostructures.

Operation

Subsidiary

Triumph Aviation
Services—Asia(1)

Triumph
Aviation
Services
Asia Ltd.

Operating
Location

Chonburi,
Thailand

Triumph Engines—
Tempe(1)

Triumph
Engineered
Solutions, Inc.

Tempe, AZ
Chandler, AZ

Triumph
Instruments—
Burbank(1)

Triumph
Instruments—
Burbank, Inc.

Burbank, CA

Triumph
Instruments—Ft.
Lauderdale(1)

Triumph
Instruments—
Austin(1)

Triumph
Instruments, Inc.

Ft. Lauderdale,
FL

Austin, TX

Business

Type of Customers

Commercial
Aftermarket.

Number of
Employees

113

Commercial, General
Aviation and Military
Aftermarket.

182

Commercial, General
Aviation and Military
Aftermarket.

Repairs and overhauls
complex aircraft
operational
components, such as
auxiliary power units
(APUs), nacelles,
constant speed drives,
fan reversers and
related accessories.

Designs, engineers,
manufactures, repairs
and overhauls
aftermarket aerospace
gas turbine engine
components and
provides repair
services and
aftermarket parts and
services to aircraft
operators,
maintenance
providers, and third-
party overhaul
facilities.

Repairs and overhauls
aircraft
instrumentation,
power systems and
avionics. Distributes
and repairs aircraft
smoke detectors and
industrial
instrumentation.

Specializes in the
repair, overhaul and
exchange of
electromechanical and
pneumatic aircraft
instruments.

Operation

Subsidiary

Triumph Interiors

Triumph
Interiors, LLC

Triumph
Interiors
Limited

Triumph Logistics—
Phoenix

Triumph Logistics—
U.K.

Triumph San Antonio
Support Center

The Triumph
Group
Operations, Inc.

Triumph
Logistics
(UK) Ltd.

The Triumph
Group
Operations, Inc.

Operation

Subsidiary

DISCONTINUED OPERATIONS

Triumph Precision
Castings

Triumph
Precision
Castings Co.

Operating
Location

Oakdale, PA(1)
Grand Prairie,
TX(1)

Shannon,
Ireland(1)

Phoenix, AZ

Basingstoke,
England

San Antonio, TX

Operating
Location

Chandler, AZ

(1) Designates FAA-certified repair station.

(2) Designates SFAR 36 certification.

Number of
Employees

132

Number of
Employees

101

Business

Type of Customers

Commercial
Aftermarket.

Commercial, General
Aviation and Military
Aftermarket.

Refurbishes and
repairs aircraft
interiors such as
sidewalls, ceiling
panels, galleys and
overhead storage bins
and manufactures a
full line of PMA
interior lighting and
plastic components.

Provides distribution,
exchange and lease
programs for auxiliary
power units (APUs),
APU components and
components
supported by Triumph
Group Companies.

Provides maintenance Military Aftermarket.
services for aircraft
ground support
equipment.

Business

Type of Customers

Commercial and

Applies advanced
directionally solidified Military Aftermarket.
(polycrystal or single
crystal) and Equiax
investment casting
processes to produce
products for the
commercial and
defense gas turbine
market.

Sales, Marketing and Engineering

While each of our operating companies maintains responsibility for selling and marketing its
specific products, we have developed two group marketing teams focused on cross-selling our broad
capabilities. The focus of these two marketing organizations, one for the Aerospace Systems Group and
one for the Aftermarket Services Group, is to sell systems, integrated assemblies and bundled repair
and overhaul services, reaching across our operating companies, to our OEM, military, airline and air
cargo customers. We also conduct sales activities in the Wichita, Kansas area through Triumph Wichita
Support Center, a third party sales organization dedicated solely to a sales effort on behalf of Triumph
Group companies, which is staffed by sales professionals focused on Boeing IDS, Spirit AeroSystems,
Cessna, Bombardier/Learjet and Raytheon. In certain limited cases, we use independent, commission-
based representatives to facilitate responsiveness to each customer’s changing needs and current trends
in each market/geographic region in which we operate.

All three of these marketing organizations operate as the front-end of the selling process,

establishing or maintaining relationships, identifying opportunities to leverage our brand, and providing
service for our customers. Each individual operating company is responsible for its own engineering
and technical support, pricing, manufacturing and product support. Also, within the Aerospace Systems
Group, we have created a group engineering function to provide integrated solutions to meet our
customer needs by designing systems that integrate the capabilities of our companies.

A significant portion of our government and defense contracts are awarded on a competitive
bidding basis. We generally do not bid or act as the primary contractor, but will typically bid and act as
a subcontractor on contracts on a fixed fee basis. We generally sell to our other customers on a fixed
fee, negotiated contract or purchase order basis.

Backlog

We have a number of long-term agreements with several of our customers. These agreements
generally describe the terms under which the customer may issue purchase orders to buy our products
and services during the term of the agreement. These terms typically include a list of the products or
repair services customers may purchase, initial pricing, anticipated quantities and, to the extent known,
delivery dates. In tracking and reporting our backlog, however, we only include amounts for which we
have actual purchase orders with firm delivery dates or contract requirements generally within the next
24 months, which primarily relates to sales to our OEM customer base. Purchase orders issued by our
aftermarket customers are usually completed within a short period of time. As a result, our backlog
data relates primarily to the OEM customers. The backlog information set forth below does not include
the sales that we expect to generate from long-term agreements for which we do not have actual
purchase orders with firm delivery dates.

As of March 31, 2008, our continuing operations had outstanding purchase orders representing an
aggregate invoice price of approximately $1,278 million, of which $1,246 million and $32 million relate
to the Aerospace Systems Group and the Aftermarket Services Group, respectively. As of March 31,
2007, our continuing operations had outstanding purchase orders representing an aggregated invoice
price of approximately $1,127 million, of which $1,093 million and $34 million relate to the Aerospace
Systems Group and the Aftermarket Services Group, respectively. Of the existing backlog of
$1,278 million, approximately $426 million will not be shipped by March 31, 2009.

For the year ended March 31, 2008, the Boeing Company, or Boeing, represented approximately
22.5% of the net sales. A significant reduction in sales to Boeing could have material adverse impact
on our financial position, results of operations, and cash flows.

United States and International Operations

Our revenues from our continuing operations to customers in the United States for fiscal years
2008, 2007 and 2006 were approximately $914 million, $735 million and $581 million, respectively. Our
revenues from our continuing operations to customers in all other countries for fiscal years 2008, 2007
and 2006 were approximately $237 million, $202 million and $168 million, respectively.

As of March 31, 2008, 2007 and 2006, our long-lived assets for our continuing operations located
in the United States were approximately $775 million, $687 million and $551 million, respectively. As of
March 31, 2008, 2007 and 2006, our long-lived assets for our continuing operations located in all other
countries were approximately $25 million, $23 million and $11 million, respectively.

Competition

We compete primarily with the top-tier systems integrators and manufacturers that supply them,

some of which are divisions or subsidiaries of other large companies, in the manufacture of aircraft
systems components and subassemblies. OEMs are increasingly focusing on assembly activities while
outsourcing more manufacturing and repair to third parties, and therefore are less of a competitive
force than in previous years.

Competition for the repair and overhaul of aviation components comes from three primary

sources, some with greater financial and other resources than we have: OEMs, major commercial
airlines and other independent repair and overhaul companies. Some major commercial airlines
continue to own and operate their own service centers, while others have begun to sell or outsource
their repair and overhaul services to other aircraft operators or third parties. Large domestic and
foreign airlines that provide repair and overhaul services typically provide these services not only for
their own aircraft but for other airlines as well. OEMs also maintain service centers which provide
repair and overhaul services for the components they manufacture. Other independent service
organizations also compete for the repair and overhaul business of other users of aircraft components.

Participants in the aerospace industry compete primarily on the basis of breadth of technical

capabilities, quality, turnaround time, capacity and price.

Government Regulation and Industry Oversight

The aerospace industry is highly regulated in the United States by the FAA and in other countries
by similar agencies. We must be certified by the FAA and, in some cases, by individual OEMs, in order
to engineer and service parts and components used in specific aircraft models. If material
authorizations or approvals were revoked or suspended, our operations would be adversely affected.
New and more stringent government regulations may be adopted, or industry oversight heightened, in
the future and these new regulations, if enacted, or any industry oversight, if heightened, may have an
adverse impact on us.

We must also satisfy the requirements of our customers, including OEMs, that are subject to FAA

regulations, and provide these customers with products and repair services that comply with the
government regulations applicable to aircraft components used in commercial flight operations. The
FAA regulates commercial flight operations and requires that aircraft components meet its stringent
standards. In addition, the FAA requires that various maintenance routines be performed on aircraft
components, and we currently satisfy these maintenance standards in our repair and overhaul services.
Several of our operating locations are FAA-approved repair stations.

Generally, the FAA only grants licenses for the manufacture or repair of a specific aircraft
component, rather than the broader licenses that have been granted in the past. The FAA licensing
process may be costly and time-consuming. In order to obtain an FAA license, an applicant must satisfy
all applicable regulations of the FAA governing repair stations. These regulations require that an

applicant have experienced personnel, inspection systems, suitable facilities and equipment. In addition,
the applicant must demonstrate a need for the license. Because an applicant must procure
manufacturing and repair manuals from third parties relating to each particular aircraft component in
order to obtain a license with respect to that component, the application process may involve
substantial cost.

The license approval processes for the European Aviation Safety Agency (EASA was formed in
2002 and is handling most of the responsibilities of the national aviation authorities, such as the United
Kingdom Civil Aviation Authority), which regulates this industry in the European Union, the Civil
Aviation Administration of China, and other comparable foreign regulatory authorities are similarly
stringent, involving potentially lengthy audits.

Our operations are also subject to a variety of worker and community safety laws. For example,
the Occupational Safety and Health Act of 1970, or OSHA, mandates general requirements for safe
workplaces for all employees. In addition, OSHA provides special procedures and measures for the
handling of hazardous and toxic substances. Specific safety standards have been promulgated for
workplaces engaged in the treatment, disposal or storage of hazardous waste. We believe that our
operations are in material compliance with OSHA’s health and safety requirements.

Environmental Matters

Our business, operations and facilities are subject to numerous stringent federal, state, local and

foreign environmental laws and regulation by government agencies, including the Environmental
Protection Agency, or the EPA. Among other matters, these regulatory authorities impose requirements
that regulate the emission, discharge, generation, management, transportation and disposal of
hazardous materials, pollutants and contaminants, govern public and private response actions to
hazardous or regulated substances which may be or have been released to the environment, and require
us to obtain and maintain licenses and permits in connection with our operations. This extensive
regulatory framework imposes significant compliance burdens and risks on us. Although management
believes that our operations and our facilities are in material compliance with such laws and
regulations, future changes in these laws, regulations or interpretations thereof or the nature of our
operations or regulatory enforcement actions which may arise, may require us to make significant
additional capital expenditures to ensure compliance in the future.

Certain of our facilities have been or are currently the subject of environmental remediation
activities, the cost of which is subject to indemnification provided by IKON Office Solutions, Inc.
(‘‘IKON’’) in connection with the acquisition by us of these facilities in 1993 from IKON. One of these
facilities is located on a site included in the EPA’s database of potential Superfund sites. IKON’s
indemnification covers us for losses we might suffer in connection with liabilities and obligations arising
under environmental, health and safety laws with respect to operations or use of those facilities prior to
their acquisition by us. Some other facilities acquired and operated by us or one of our subsidiaries,
including a leased facility located on an EPA National Priorities List site, were under active
investigation for environmental contamination by federal or state agencies when acquired, and at least
in some cases, continue to be under investigation. We are generally indemnified by prior owners or
operators and/or present owners of the facilities for liabilities which we incur as a result of these
investigations and the environmental contamination found which pre-dates our acquisition of these
facilities, subject to certain limitations. We also maintain a pollution liability policy that provides
coverage for material liabilities associated with the clean-up of on-site pollution conditions, as well as
defense and indemnity for certain third party suits (including Superfund liabilities at third party sites),
in each case, to the extent not otherwise indemnified. This policy applies to all of our manufacturing
and assembly operations worldwide. However, if we were required to pay the expenses related to
environmental liabilities for which neither indemnification nor insurance coverage is available, these
expenses could have a material adverse effect on us.

Employees

As of March 31, 2008, for our continuing operations we employed 5,572 persons, of whom 549

were management employees, 121 were sales and marketing personnel, 567 were technical personnel,
769 were administrative personnel and 3,566 were production workers. As of March 31, 2008, for our
discontinued operations we employed 101 persons, of whom 4 were management employees, 10 were
technical personnel, 18 were administrative personnel and 69 were production workers.

Several of our subsidiaries are parties to collective bargaining agreements with labor unions. Under
those agreements, we currently employ approximately 752 full-time employees. Currently, approximately
13.5% of our permanent employees are represented by labor unions and approximately 21.9% of net
sales are derived from the facilities at which at least some employees are unionized. Our inability to
negotiate an acceptable contract with any of these labor unions could result in strikes by the affected
workers and increased operating costs as a result of higher wages or benefits paid to union members. If
the unionized workers were to engage in a strike or other work stoppage, or other employees were to
become unionized, we could experience a significant disruption of our operations and higher ongoing
labor costs, which could have an adverse effect on our business and results of operations.

We have not experienced any material labor-related work stoppage and consider our relations with

our employees to be good.

Research and Development Expense

Certain information about our research and development expenses for the fiscal years ended
March 31, 2008, 2007 and 2006 is available in Note 2 of ‘‘Notes to Consolidated Financial Statements.’’

Executive Officers

Name

Richard C. Ill . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . .
M. David Kornblatt

Age

65
48

Position

President and Chief Executive Officer
Senior Vice President, Chief Financial Officer
and Treasurer

John B. Wright, II . . . . . . . . . . . . . .
Kevin E. Kindig . . . . . . . . . . . . . . . .

54 Vice President, General Counsel and Secretary
51 Vice President and Controller

Richard C. Ill has been our President and Chief Executive Officer and a director since 1993.
Mr. Ill is a director of P.H. Glatfelter Company, Airgas Inc. and Baker Industries and a member of the
advisory board of Outward Bound, USA.

M. David Kornblatt has been Senior Vice President and Chief Financial Officer since June 2007.

From 2006 until joining us, Mr. Kornblatt served as Senior Vice President—Finance and Chief
Financial Officer at Carpenter Technology Corporation, a manufacturer and distributor of specialty
alloys and various engineered products. From 2003 to 2005, he was Vice President and Chief Financial
Officer at York International, prior to its acquisition by Johnson Controls in December 2005. Before
that, Mr. Kornblatt was the Director of Taxes-Europe for The Gillette Company in London, England
for three years. Mr. Kornblatt is a director of Universal Stainless & Alloy Products, Inc.

John B. Wright, II has been a Vice President and our General Counsel and Secretary since 2004.
From 2001 until he joined us, Mr. Wright was a partner with the law firm of Ballard Spahr Andrews &
Ingersoll, LLP, where he practiced corporate and securities law.

Kevin E. Kindig has been our Controller since 1993 and a Vice President since April 1999.

Available Information

For more information about us, visit our website at www.triumphgroup.com. The contents of the

website are not part of this Form 10-K. Our electronic filings with the Securities and Exchange
Commission (including all Forms 10-K, 10-Q and 8-K, and any amendments to these reports) are
available free of charge through our website immediately after we electronically file with or furnish
them to the Securities and Exchange Commission. These filings may also be read and copied at the
SEC’s Public Reference Room which is located at 100 F Street, N.E., Washington, D.C. 20549.
Information about the operation of the Public Reference Room can be obtained by calling the SEC at
1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information
statements, and other information regarding issuers who file electronically with the SEC at
www.sec.gov.

Item 1A. Risk Factors

Factors that have an adverse impact on the aerospace industry may adversely affect our results of
operations. A substantial percentage of our gross profit and operating income was derived from
commercial aviation for fiscal year 2008. Our operations are focused on designing, engineering and
manufacturing aircraft components for new aircraft, selling spare parts and performing repair and
overhaul services on existing aircraft and aircraft components. Therefore, our business is directly
affected by economic factors and other trends that affect our customers in the aerospace industry,
including a possible decrease in outsourcing by OEMs and aircraft operators or projected market
growth that may not materialize or be sustainable. We are also significantly dependent on sales to the
commercial aerospace market, which has been cyclical in nature with significant downturns in the past.
When these economic and other factors adversely affect the aerospace industry, they tend to reduce the
overall customer demand for our products and services, which decreases our operating income.
Economic and other factors that might affect the aerospace industry may have an adverse impact on
our results of operations. The financial condition of our airline customers has deteriorated and thereby
introduced credit risk with some of our significant airline customers, as well as introducing negative
implications for their ability to fund the acquisition of new aircraft for their fleet. In addition, the
recent rise in energy costs has significantly increased the price of fuel to the airlines resulting in
additional pressure on operating costs. These or other events may lead to further declines in the
worldwide aerospace industry that could further adversely affect our business and financial condition.

Competitive pressures may adversely affect us. We have numerous competitors in the aerospace
industry. We compete primarily with the top-tier systems integrators and the manufacturers that supply
them, some of which are divisions or subsidiaries of OEMs and other large companies that
manufacture aircraft components and subassemblies. Competition for the repair and overhaul of
aviation components comes from three primary sources: OEMs, major commercial airlines and other
independent repair and overhaul companies. Some of our competitors have substantially greater
financial and other resources than we have. Competitive pressures may materially adversely affect our
operating revenues and margins, and, in turn, our business and financial condition.

We may need to expend significant capital to keep pace with technological developments in our

industry. The aerospace industry is constantly undergoing development and change and it is likely that
new products, equipment and methods of repair and overhaul service will be introduced in the future.
In order to keep pace with any new developments, we may need to expend significant capital to
purchase new equipment and machines or to train our employees in the new methods of production
and service.

We may incur significant expenses to comply with new or more stringent governmental regulation. The

aerospace industry is highly regulated in the United States by the FAA and in other countries by

similar agencies. We must be certified by the FAA and, in some cases, by individual OEMs in order to
engineer and service parts and components used in specific aircraft models. If any of our material
authorizations or approvals were revoked or suspended, our operations would be adversely affected.
New or more stringent governmental regulations may be adopted, or industry oversight heightened in
the future, and we may incur significant expenses to comply with any new regulations or any
heightened industry oversight.

A significant decline in business with a key customer could have a material adverse effect on us. For
the year ended March 31, 2008, The Boeing Company, or Boeing, represented approximately 22.5% of
net sales. Accordingly, a significant reduction in purchases by this customer could have a material
adverse impact on our financial position, results of operations, and cash flows. In addition, some of our
operating locations have significant customers, the loss of whom could have an adverse effect on those
businesses.

Demand for our military and defense products is dependent upon government spending.

Approximately 33% of our sales for fiscal year 2008 were derived from the military and defense
market, which includes both direct and indirect sales to the U.S. Government. The military and defense
market is largely dependent upon government budgets, particularly the U.S. defense budget, and even
an increase in defense spending may not be allocated to programs that would benefit our business.
Moreover, the new military aircraft programs in which we participate may not enter full-scale
production as expected. A change in the levels of defense spending or levels of military flight
operations could curtail or enhance our prospects in this market depending upon the programs
affected.

Some contractual arrangements with our customers may cause us to bear significant up-front costs that

we may not be able to recover. Many new aircraft programs require that major suppliers bear the cost
of design, development and engineering work associated with the development of the aircraft usually in
exchange for a long-term agreement to supply critical parts once the aircraft is in production. Boeing’s
787 and Airbus’ A380 are examples of two new aircraft programs in which we are competing in a
product development process in order to obtain eventual long term production agreements. If the
aircraft fails to reach the full production stage or we fail to win the long-term contract, the outlays we
have made in research and development and other start-up costs may not produce the anticipated
return on investment.

We may not realize our anticipated return on capital commitments made to expand our capabilities.

We continually make significant capital expenditures to implement new processes and to increase both
efficiency and capacity. Some of these projects require additional training for our employees and not all
projects may be implemented as anticipated. If any of these projects do not achieve the anticipated
increase in efficiency or capacity, our returns on these capital expenditures may not be as expected.

Our expansion into international markets may increase credit, currency and other risks. As we pursue

customers in Asia, South America and other less developed aerospace markets throughout the world,
our inability to ensure the creditworthiness of our customers in these areas could adversely impact our
overall profitability. In addition, with the completion of our Thailand facility and as we pursue
customers in other parts of the world, we will be subject to the legal, political, social and regulatory
requirements and economic conditions of other jurisdictions. In the future, we may also make
additional international capital investments, including acquisitions of companies outside the United
States or companies having operations outside the United States. Risks inherent to international
operations include, but are not limited to, the following:

(cid:127) difficulty in enforcing agreements in some legal systems outside the United States;

(cid:127) countries may impose additional withholding taxes or otherwise tax our foreign income, impose
tariffs or adopt other restrictions on foreign trade and investment, including currency exchange
controls;

(cid:127) fluctuations in exchange rates may affect demand for our products and services and may

adversely affect our profitability in U.S. dollars;

(cid:127) inability to obtain, maintain or enforce intellectual property rights;

(cid:127) changes in general economic and political conditions in the countries in which we operate;

(cid:127) unexpected adverse changes in the laws or regulatory requirements outside the U.S., including

those with respect to environmental protection, export duties and quotas;

(cid:127) difficulty with staffing and managing widespread operations; and

(cid:127) difficulty of and costs relating to compliance with the different commercial and legal

requirements of the countries in which we operate.

We may need additional financing for acquisitions and capital expenditures and additional financing

may not be available on terms acceptable to us. A key element of our strategy has been, and continues
to be, internal growth supplemented by growth through the acquisition of additional companies and
product lines engaged in the aerospace industry. In order to grow internally, we may need to make
significant capital expenditures, such as investing in facilities in low cost countries, and may need
additional capital to do so. Our ability to grow is dependent upon, and may be limited by, among other
things, availability under our credit facility and by particular restrictions contained in our credit facility
and our other financing arrangements. In that case, additional funding sources may be needed, and we
may not be able to obtain the additional capital necessary to pursue our internal growth and acquisition
strategy or, if we can obtain additional financing, the additional financing may not be on financial terms
that are satisfactory to us, particularly in light of the current instability in the credit markets.

Cancellations, reductions or delays in customer orders may adversely affect our results of operations.
Our overall operating results are affected by many factors, including the timing of orders from large
customers and the timing of expenditures to manufacture parts and purchase inventory in anticipation
of future sales of products and services. A large portion of our operating expenses are relatively fixed.
Because several of our operating locations typically do not obtain long-term purchase orders or
commitments from our customers, they must anticipate the future volume of orders based upon the
historic purchasing patterns of customers and upon our discussions with customers as to their
anticipated future requirements. These historic patterns may be disrupted by many factors, including
changing economic conditions, inventory adjustments, or work stoppages or labor disruptions at our
customers. Cancellations, reductions or delays in orders by a customer or group of customers could
have a material adverse effect on our business, financial condition and results of operations.

Our acquisition strategy exposes us to risks, including the risk that we may not be able to successfully

integrate acquired businesses. We have a consistent strategy to grow, in part, by the acquisition of
additional businesses in the aerospace industry and are continuously evaluating various acquisition
opportunities, including those outside the United States and those that are larger than the acquisitions
we have made previously. However, we do not have any definitive agreements at this time to acquire
additional businesses. Our ability to grow by acquisition is dependent upon, among other factors, the
availability of suitable acquisition candidates. Growth by acquisition involves risks that could adversely
affect our operating results, including difficulties in integrating the operations and personnel of
acquired companies, the potential amortization of acquired intangible assets, the potential impairment
of goodwill and the potential loss of key employees of acquired companies. We may not be able to

consummate acquisitions on satisfactory terms or, if any acquisitions are consummated, satisfactorily
integrate these acquired businesses.

Any product liability claims in excess of insurance may adversely affect our financial condition. Our

operations expose us to potential liability for personal injury or death as a result of the failure of an
aircraft component that has been serviced by us or the failure of an aircraft component designed or
manufactured by us. While we believe that our liability insurance is adequate to protect us from these
liabilities, our insurance may not cover all liabilities. Additionally, insurance coverage may not be
available in the future at a cost acceptable to us. Any material liability not covered by insurance or for
which third party indemnification is not available could have a material adverse effect on our financial
condition.

The lack of available skilled personnel may have an adverse effect on our operations. From time to

time, some of our operating locations have experienced difficulties in attracting and retaining skilled
personnel to design, engineer, manufacture, repair and overhaul sophisticated aircraft components. Our
ability to operate successfully could be jeopardized if we are unable to attract and retain a sufficient
number of skilled personnel to conduct our business.

Any exposure to environmental liabilities may adversely affect us. Our business, operations and
facilities are subject to numerous stringent federal, state, local and foreign environmental laws and
regulations. Although management believes that our operations and facilities are in material
compliance with such laws and regulations, future changes in such laws, regulations or interpretations
thereof or the nature of our operations or regulatory enforcement actions which may arise, may require
us to make significant additional capital expenditures to ensure compliance in the future. Some of our
facilities have been or are currently the subject of environmental remediation activities, the cost of
which is subject to indemnification provided by IKON Office Solutions, Inc., or IKON. The IKON
indemnification covers the cost of liabilities that arise from environmental conditions or activities
existing at facilities prior to our acquisition from IKON in July 1993, including the costs and claims
associated with the environmental remediation activities and liabilities discussed above. Some other
facilities acquired and operated by us or one of our subsidiaries have at one time or another been
under active investigation for environmental contamination by federal or state agencies when acquired
and, at least in some cases, continue to be under investigation or subject to remediation. Individual
facilities of ours have also been subject to investigation on occasion for possible past waste disposal
practices which might have contributed to contamination at or from remote waste disposal sites. We are
often indemnified by prior owners or operators and/or present owners of the facilities for liabilities
which we might otherwise incur as a result of these investigations and the environmental contamination
found which pre-dates our acquisition of these facilities, subject to certain limitations, including but not
limited to limitations on the survival period of the indemnity. We also maintain a pollution liability
policy that provides coverage for material liabilities associated with the clean-up of on-site pollution
conditions, as well as defense and indemnity for certain third party suits (including Superfund liabilities
at third party sites), in each case, to the extent not otherwise indemnified. This policy applies to all of
our manufacturing and assembly operations worldwide. However, if we were required to pay the
expenses related to environmental liabilities for which neither indemnification nor insurance coverage is
available, these expenses could have a material adverse effect on our financial position, results of
operations, and cash flows.

We are currently involved in intellectual property litigation, which could have a material and adverse

impact on our profitability, and we could become so involved again in the future. We and other
companies in our industry possess certain proprietary rights relating to designs, engineering,
manufacturing processes and repair and overhaul procedures. In the event that we believe that a third
party is infringing upon our proprietary rights, we may bring an action to enforce such rights. In
addition, third parties may claim infringement by us with respect to their proprietary rights and may

initiate legal proceedings against us in the future. The expense and time of bringing an action to
enforce such rights or defending against infringement claims can be significant, as in the case of the
litigation arising out of the claims of Eaton Corporation discussed in ‘‘Item 3. Legal Proceedings.’’ The
expense and time associated with such litigation may have a material and adverse impact on our
profitability. In addition, in our overhaul and repair businesses, OEMs of equipment that we maintain
for our customers increasingly include language in repair manuals relating to their equipment asserting
broad claims of proprietary rights to the contents of the manuals used in our operations. Although we
believe that our use of manufacture and repair manuals is lawful, there can be no assurance that
OEMs will not try to enforce such claims, including through the possible use of legal proceedings, or
that any such actions will be unsuccessful.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

Our executive offices are located in Wayne, Pennsylvania, where we lease 11,691 square feet of

space. In addition, as of May 15, 2008, we owned or leased the following operating facilities.

Location

Description

TRIUMPH AEROSPACE SYSTEMS GROUP
Hot Springs, AR . . . . . . . . . . . . . . Manufacturing facility/office
Chandler, AZ . . . . . . . . . . . . . . . . Manufacturing facility/office
Chatsworth, CA . . . . . . . . . . . . . . . Manufacturing facility/office
Chatsworth, CA . . . . . . . . . . . . . . . Manufacturing facility
City of Industry, CA . . . . . . . . . . . . Manufacturing facility/office
El Cajon, CA . . . . . . . . . . . . . . . . . Manufacturing facility/office
Lynwood, CA . . . . . . . . . . . . . . . . . Processing and finishing facility/office
Lynwood, CA . . . . . . . . . . . . . . . . . Office/warehouse/aerospace metal processing
San Diego, CA . . . . . . . . . . . . . . . Force measurement systems facility
Valencia, CA . . . . . . . . . . . . . . . . . Manufacturing facility/office
Walnut, CA . . . . . . . . . . . . . . . . . . Manufacturing facility/office
Bethel, CT . . . . . . . . . . . . . . . . . . . Office
Bloomfield, CT . . . . . . . . . . . . . . . Manufacturing facility/office
East Lyme, CT . . . . . . . . . . . . . . . . Manufacturing facility/office
New Haven, CT . . . . . . . . . . . . . . . Engineering/manufacturing
Alfortville, France . . . . . . . . . . . . . Manufacturing facility/office
Shelbyville, IN . . . . . . . . . . . . . . . . Manufacturing facility/office
Shelbyville, IN . . . . . . . . . . . . . . . . Manufacturing facility/office
Wichita, KS . . . . . . . . . . . . . . . . . . Manufacturing facility/office
Wichita, KS . . . . . . . . . . . . . . . . . . Manufacturing facility/office
Macomb, MI . . . . . . . . . . . . . . . . . Manufacturing facility/office
Grandview, MO . . . . . . . . . . . . . . . Manufacturing facility/office
Freeport, NY . . . . . . . . . . . . . . . . . Manufacturing facility/office/warehouse
Rochester, NY . . . . . . . . . . . . . . . . Engineering Office
Westbury, NY . . . . . . . . . . . . . . . . Manufacturing facility/office
Westbury, NY . . . . . . . . . . . . . . . . Aerospace Metal Processing
Clemmons, NC . . . . . . . . . . . . . . . Manufacturing facility/repair/office
Forest, OH . . . . . . . . . . . . . . . . . . Manufacturing facility/office

Square
Footage

Owned/
Leased

217,348 Owned
34,263 Leased
101,900 Owned
21,600 Leased
75,000 Leased
122,390 Leased
59,662 Leased
105,000 Leased
7,000 Leased
86,970 Leased
126,000 Leased
1,650 Leased
29,825 Leased
59,550 Owned
2,400 Leased
7,500 Leased
193,905 Owned
100,000 Owned
145,200 Leased
130,275 Leased
86,000 Leased
78,000 Owned
29,000 Owned
5,000 Leased
93,500 Leased
12,500 Leased
110,000 Owned
125,000 Owned

Location

Description

TRIUMPH AEROSPACE SYSTEMS GROUP (continued)
Albany, OR . . . . . . . . . . . . . . . . . . Machine shop/office
North Wales, PA . . . . . . . . . . . . . . Manufacturing facility/office
Fort Worth, TX . . . . . . . . . . . . . . . Manufacturing facility/office
Park City, UT . . . . . . . . . . . . . . . . Manufacturing facility/office
Newport News, VA . . . . . . . . . . . . Engineering/Manufacturing/office
Redmond, WA . . . . . . . . . . . . . . . . Manufacturing facility/office
Spokane, WA . . . . . . . . . . . . . . . . . Manufacturing facility/office

TRIUMPH AFTERMARKET SERVICES GROUP
Hot Springs, AR . . . . . . . . . . . . . . Machine shop/office
Chandler, AZ . . . . . . . . . . . . . . . . Thermal processing facility/office
Phoenix, AZ . . . . . . . . . . . . . . . . . Repair and overhaul shop/office
Phoenix, AZ . . . . . . . . . . . . . . . . . Repair and overhaul/office
Tempe, AZ . . . . . . . . . . . . . . . . . . Manufacturing facility/office
Tempe, AZ . . . . . . . . . . . . . . . . . . Machine shop
Tempe, AZ . . . . . . . . . . . . . . . . . . Machine shop
Burbank, CA . . . . . . . . . . . . . . . . .
Basingstoke, England . . . . . . . . . . . Repair and overhaul/office
Ft. Lauderdale, FL . . . . . . . . . . . . .
Shannon, Ireland . . . . . . . . . . . . . . Production/warehouse/office
Wellington, KS . . . . . . . . . . . . . . . . Repair and overhaul/office
Oakdale, PA . . . . . . . . . . . . . . . . . Production/warehouse/office
Austin, TX . . . . . . . . . . . . . . . . . .
Dallas, TX . . . . . . . . . . . . . . . . . . . Production/office
Grand Prairie, TX . . . . . . . . . . . . . Repair and overhaul shop/office
San Antonio, TX . . . . . . . . . . . . . . Repair and overhaul/office
Chonburi, Thailand . . . . . . . . . . . . Repair and overhaul shop/office
Milwaukee, WI . . . . . . . . . . . . . . . Office

Instrument shop/warehouse/office

DISCONTINUED OPERATIONS
Chandler, AZ . . . . . . . . . . . . . . . . Casting facility/office

Square
Footage

Owned/
Leased

25,000 Owned
111,400 Owned
114,100 Owned
180,000 Owned
93,000 Leased
19,404 Leased
392,000 Owned

219,728 Owned
15,000 Leased
50,000 Leased
24,796 Leased
13,500 Owned
9,300 Owned
32,000 Owned
23,000 Leased
3,350 Leased
11,700 Leased
13,000 Leased
65,000 Leased
68,000 Leased
4,500 Leased
28,602 Leased
60,000 Leased
30,000 Leased
85,000 Owned
2,600 Leased

31,000 Leased

We believe that our properties are adequate to support our operations for the foreseeable future.

Item 3. Legal Proceedings

On July 9, 2004, Eaton Corporation and several Eaton subsidiaries filed a complaint against us,

our subsidiary, Frisby Aerospace, LLC (now named Triumph Actuation Systems, LLC), certain related
subsidiaries and certain employees of ours and our subsidiaries. The complaint was filed in the Circuit
Court of the First Judicial District of Hinds County, Mississippi and alleged nineteen causes of action
under Mississippi law. In particular, the complaint alleged the misappropriation of trade secrets and
intellectual property allegedly belonging to Eaton relating to hydraulic pumps and motors used in
military and commercial aviation. Triumph Actuation Systems and the individual defendants filed
separate responses to Eaton’s claims. Triumph Actuation Systems filed counterclaims against Eaton
alleging common law unfair competition, interference with existing and prospective contracts, abuse of
process, defamation, violation of North Carolina’s Unfair and Deceptive Trade Practices Act, and
violation of the false advertising provisions of the Lanham Act. We and defendant Jeff Frisby, President
of Triumph Actuation Systems at the time the engineer defendants were hired, moved to dismiss the
complaint for lack of personal jurisdiction.

The above allegations also relate to alleged conduct that has been the subject of an investigation
by the office of the U.S. Attorney in Jackson, Mississippi. On January 22, 2004, a search warrant was
executed on the offices of Triumph Actuation Systems in connection with this investigation. Triumph
Actuation Systems cooperated with the investigation. On December 20, 2006, five engineers of Triumph
Actuation Systems who are former employees of Eaton Aerospace, LLC, were indicted by a grand jury
sitting in the Southern District of Mississippi on five counts of trade secret misappropriation, conspiracy
to misappropriate trade secrets, and mail and wire fraud. On June 15, 2007, all counts other than
part of one count were dismissed by the court, leaving a charge of conspiracy to misappropriate trade
secrets.

On October 11, 2007, the government obtained a new indictment against the same five engineer
defendants raising new charges arising out of the same investigation, which were essentially reiterated
in a second superseding indictment obtained on November 11, 2007. The defendant engineers
subsequently filed pretrial motions, including motions to dismiss. On April 25, 2008, the court granted
some of those motions and dismissed seven of the twelve counts of the second superseding indictment.
The government has filed an appeal of this dismissal with the United States Court of Appeals for the
Fifth Circuit. The trial date of June 16, 2008 will be continued while the appeal is pending. No charges
have been brought against Triumph Actuation Systems or us, and we understand that neither Triumph
Actuation Systems nor the Company is currently the subject of the criminal investigation.

In the civil case, following stays of most discovery while the parties litigated a motion to dismiss

and a motion to protect the defendant engineers’ Fifth Amendment rights, discovery recommenced in
late August 2007. However, on January 4, 2008, the judge in the civil case, Judge Bobby DeLaughter,
recused himself on his own motion. The case has been reassigned to a new judge, Chief Judge W. Swan
Yerger.

On January 24, 2008, Triumph Actuation Systems filed a motion to stay all discovery in order to
review and reconsider Judge DeLaughter’s prior orders based on the ongoing federal investigation of
an alleged ex parte and inappropriate relationship between Judge DeLaughter and Ed Peters, a lawyer
representing Eaton for whom Judge DeLaughter had worked prior to his appointment to the bench.
Judge DeLaughter has since been suspended from the bench. Triumph Actuation Systems has also filed
other motions relating to this alleged inappropriate relationship, including a motion for sanctions.
Judge Yerger has ordered that this conduct be examined and has undertaken, along with a newly
appointed Special Master, to review Judge DeLaughter’s rulings in the case from the time Mr. Peters
became involved. In the meantime, all other proceedings in the case have been stayed. No trial date
has been set. It is too early to determine what, if any, exposure to liability Triumph Actuation Systems
or the Company might face as a result of the civil suit. We intend to continue to vigorously defend the
allegations contained in Eaton’s complaint and to vigorously prosecute the counterclaims brought by
Triumph Actuation Systems.

In the ordinary course of our business, we are also involved in disputes, claims, lawsuits, and

governmental and regulatory inquiries that we deem to be immaterial. Some may involve claims or
potential claims of substantial damages, fines or penalties. While we cannot predict the outcome of any
pending or future litigation or proceeding, we do not believe that any pending matter will have a
material effect, individually or in the aggregate, on our financial position or results of operations,
although no assurances can be given to that effect.

Item 4. Submission of Matters to a Vote of Security Holders

None.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases

PART II

of Equity Securities

Range of Market Price

Our Common Stock is traded on the New York Stock Exchange under the symbol ‘‘TGI.’’ The

following table sets forth the range of high and low prices for our Common Stock for the periods
indicated:

Fiscal 2007

1st Quarter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2nd Quarter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3rd Quarter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4th Quarter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Fiscal 2008

High

Low

$54.90
50.85
55.03
57.45

$69.63
85.14
86.38
82.71

$43.83
40.60
40.98
51.61

$54.49
65.72
71.84
48.25

On May 15, 2008, the reported closing price for our Common Stock was $68.94. As of May 15,
2008, there were approximately 78 holders of record of our Common Stock and we believe that our
Common Stock was beneficially owned by approximately 13,000 persons.

Dividend Policy

During fiscal 2008 and 2007, we paid cash dividends of $0.16 per share and $0.12 per share,
respectively. However, our declaration and payment of cash dividends in the future and the amount
thereof will depend upon our results of operations, financial condition, cash requirements, future
prospects, limitations imposed by credit agreements or indentures governing debt securities and other
factors deemed relevant by our board of directors. No assurance can be given that cash dividends will
continue to be declared and paid at historical levels or at all. Certain of our debt arrangements,
including our credit facility, restrict our paying dividends and making distributions on our capital stock,
except for the payment of stock dividends and redemptions of an employee’s shares of capital stock
upon termination of employment.

Repurchases of Stock

Period

Total number of
shares purchased

Average price
paid per share

Total number of
shares purchased
as part of publicly
announced plans

Maximum number
of shares that may
yet be purchased
under the plans

February 1-29, 2008 . . . . . . . . . . . . .

220,000

$56.10

499,200

500,800

Equity Compensation Plan Information

The information required regarding equity compensation plan information is included in our Proxy

Statement in connection with our 2008 Annual Meeting of Stockholders to be held on July 24, 2008,
under the heading ‘‘Equity Compensation Plan Information’’ and is incorporated herein by reference.

Stock Performance Graph

The following graph compares the cumulative 5-year total return provided shareholders on

Triumph Group, Inc.’s common stock relative to the cumulative total returns of the Russell 2000 index
and the S&P Aerospace & Defense index. An investment of $100 (with reinvestment of all dividends) is
assumed to have been made in our common stock and in each of the indexes on 3/31/2003 and its
relative performance is tracked through 3/31/2008. The stock price performance included in this graph
is not necessarily indicative of future stock price performance.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among Triumph Group, Inc., The Russell 2000 Index
And The S&P Aerospace & Defense Index

$300

$250

$200

$150

$100

$50

3/03

3/04

3/05

3/06

3/07

3/08

Triumph Group, Inc.

Russell 2000

S&P Aerospace & Defense

22MAY200816093858

$100 invested on 3/31/03 in stock or index-including reinvestment of dividends. Fiscal year ended
March 31.

Triumph Group, Inc.
. . . . . . . . . . . . . . . . . . . . .
Russell 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . .
S&P Aerospace & Defense . . . . . . . . . . . . . . . . .

100.00
100.00
100.00

147.22
163.83
141.37

173.45
172.70
177.87

197.15
217.34
219.14

247.09
230.18
254.32

254.79
200.25
267.32

3/03

3/04

3/05

3/06

3/07

3/08

Item 6. Selected Financial Data

The following selected financial data should be read in conjunction with the Consolidated
Financial Statements and related Notes thereto and ‘‘Management’s Discussion and Analysis of
Financial Condition and Results of Operations’’ included herein.

Fiscal Years Ended March 31,

2008(1)(2)(3)

2007(2)(3)(4)

2006(3)

2005(3)(5)

2004(3)(6)

(in thousands, except per share data)

Operating Data:
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cost of products sold, . . . . . . . . . . . . . . . . . . . . .

$1,151,090
822,288

$937,327
671,838

$749,368
549,307

$676,557
504,752

$602,868
449,486

Selling, general and administrative expense . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . .

Operating income . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense and other . . . . . . . . . . . . . . . . . .
. . . . . . . . .
Charge for early extinguishment of debt

Income from continuing operations, before income

taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income tax expense . . . . . . . . . . . . . . . . . . . . . .

Income from continuing operations
. . . . . . . . . . . .
Loss from discontinued operations . . . . . . . . . . . . .

328,802
159,262
43,215

126,325
13,422
—

112,903
37,161

75,742
(8,468)

265,489
135,887
35,703

93,899
11,706
5,088

77,105
26,129

50,976
(3,905)

200,061
108,063
30,827

61,171
10,304
—

50,867
11,608

39,259
(4,744)

171,805
105,382
29,500

36,923
11,259
—

25,664
6,437

19,227
(7,799)

153,382
88,812
28,054

36,516
11,780
—

24,736
5,108

19,628
(1,406)

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . .

67,274

$ 47,071

$ 34,515

$ 11,428

$ 18,222

Earnings per share:

Income from continuing operations:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash dividends declared per share . . . . . . . . . . . . . .

$
$
$

Shares used in computing earnings per share:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.59
4.32
0.16

16,497
17,540

$
$
$

3.14
3.11
0.12

16,220
16,413

$
$

2.47
2.45
—

$
$

1.21
1.20
—

15,920
16,060

15,877
15,971

$
$

1.24
1.23
—

15,842
15,918

2008(1)(2)(3)

2007(2)(3)(4)

2006(3)

2005(3)(5)

2004(3)(6)

As of March 31,

(in thousands)

Balance Sheet Data:
Working capital
. . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 404,180
1,414,835

$ 317,451
1,219,887

$256,480
977,253

$222,280
937,715

$260,269
935,541

Long-term debt, including current portion . . . . . . . . . .

419,813

316,183

161,417

157,782

225,847

Total stockholders’ equity . . . . . . . . . . . . . . . . . . . .

$ 692,729

$ 627,363

$563,703

$526,663

$514,314

(1)

Includes the acquisition of the assets and business of B. & R. Machine & Tool Corp. from the date of acquisition. See
Note 3 to the Consolidated Financial Statements.

(2) Fiscal years 2008 and 2007 include stock-based compensation pre-tax charges of $2.8 million and $2.5 million, respectively,

related to the adoption of SFAS No. 123R as of April 1, 2006.

(3) During 2008, the Company sold the assets of Triumph Precision, Inc. and also decided to sell Triumph Precision

Castings Co. These businesses have been classified as discontinued operations in 2008 and, accordingly, the results for fiscal
years prior to 2008 have also been reclassified to conform with the 2008 presentation. See Note 4 to the Consolidated
Financial Statements.

(4)

Includes the acquisition of the assets and businesses of Excel Manufacturing, Inc., Air Excellence International, Inc., Grand
Prairie Accessory Services, LLC and the acquisition through merger of Allied Aerospace Industries, Inc., from the date of
each respective acquisition. See Note 3 to the Consolidated Financial Statements.

(5) Results include $3.1 million of restructuring costs associated with ceasing the operations of the Company’s Phoenix

Manufacturing Division of the Company’s Triumph Engineered Solutions subsidiary and the divestitures of the Company’s
IGT repair division and the Wisconsin Manufacturing division of the Company’s Triumph Engineered Solutions subsidiary.

(6)

Includes the acquisitions of Parker Hannifin’s United Aircraft Products Division and Rolls-Royce Gear Systems, Inc. from
the date of each respective acquisition.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

(The following discussion should be read in conjunction with the Consolidated Financial

Statements and notes thereto contained elsewhere herein.)

OVERVIEW

We are a major supplier to the aerospace industry and have two operating segments: (i) Triumph

Aerospace Systems Group, whose companies design, engineer, manufacture and sell a wide range of
proprietary and build-to-print components, assemblies and systems for the global aerospace OEM
market; and (ii) Triumph Aftermarket Services Group, whose companies serve aircraft fleets, notably
commercial airlines, the U.S. military and cargo carriers, through the maintenance, repair and overhaul
of aircraft components and accessories manufactured by third parties.

Financial highlights for the fiscal year ended March 31, 2008 include:

(cid:127) Net sales for fiscal 2008 increased 23% to $1.2 billion

(cid:127) Operating income in fiscal 2008 increased 35% to $126.3 million

(cid:127) Net income for fiscal 2008 increased 43% to $67.3 million

(cid:127) Backlog increased 13% over prior year to $1.3 billion

For the fiscal year ended March 31, 2008, net sales totaled $1.2 billion, a 23% increase from fiscal

year 2007 net sales of $0.9 billion. Net income for fiscal year 2008 increased 43% to $67.3 million, or
$3.84 per diluted common share, versus $47.1 million, or $2.87 per diluted common share, for fiscal
year 2007.

Our working capital needs are generally funded through cash flows from operations and
borrowings under our credit arrangements. For the fiscal year ended March 31, 2008, we generated
approximately $51.1 million of cash flows from operating activities, used approximately $125.2 million
in investing activities and generated approximately $79.8 million in financing activities.

We continue to remain focused on growing our core businesses as well as growing through

strategic acquisitions. Our organic growth remained strong in fiscal 2008 through the addition of
products and services, the expansion of our operating capacity and marketing our complete portfolio of
capabilities, while benefiting from the continued strength in the aerospace markets generally. Our core
revenue growth in fiscal 2008 as compared to fiscal 2007 excluding the impact of acquisitions was 19%.
Our company has an aggressive but selective acquisition approach that adds capabilities and increases
our capacity for strong and consistent internal growth. In February 2008, the Company acquired the
assets and business of B. & R. Machine & Tool Corp. (‘‘B & R’’) through a newly organized, wholly-
owned subsidiary of the Company, Triumph Structures—Long Island, LLC. Triumph Structures—Long
Island, LLC provides aircraft structural components and dynamic parts and assemblies for commercial
and military aerospace programs. The results for Triumph Structures—Long Island, LLC are included
in the Company’s Aerospace Systems Segment.

OUTLOOK

Based upon the assumptions about our market set forth below, and subject to the risks and
uncertainties described elsewhere in this Annual Report on Form 10-K, we expect net sales for the
fiscal year ending March 31, 2009 to be in the range of $1.25 billion to $1.35 billion, and earnings per
share for fiscal 2009 to be between $4.85 and $5.05. The fiscal 2009 outlook assumes, among other
factors, a full-year effective tax rate of 35.0%, which reflects the fact that the research and development
tax credit expired on December 31, 2007. The 2009 outlook for earnings per share is based on a fully
diluted share count of 18 million shares.

Our fiscal 2009 outlook is based on the following market assumptions:

(cid:127) We expect the commercial jet aircraft market and the airline industry to remain extremely

competitive. Market liberalization in Europe and Asia has continued to enable low-cost airlines
to gain market share, and traditional airlines continue to improve their competitive position by
lowering their cost structure through merger, bankruptcy and restructuring. Some of the airline
restructurings have led to increased outsourcing opportunities, benefiting our Aftermarket
Services segment.

(cid:127) The financial health of the commercial airline industry has a direct effect on our commercial

aircraft programs. While near-term challenges include high fuel prices and continuing turmoil in
global credit markets, airlines are responding by focusing on controlling non-fuel related
expenses and implementing operational efficiencies. Based upon currently available market
forecasts, we expect aircraft seat miles, a key indicator of airline health, to remain steady at 4%
to 5% annual growth in calendar 2008 and continue at these levels through calendar 2012,
positively affecting our business. The airlines’ ability to implement fare increases to partially
offset the high cost of fuel should also help to stabilize the financial position of the airlines.

(cid:127) Air cargo continues to exhibit strong growth and financial stability, a key market segment for

Triumph given our product penetration with these carriers. We expect the continued growth in
air freight will benefit us and the industry.

(cid:127) Deliveries of Boeing and Airbus large commercial aircraft are expected to be higher in calendar
2008 compared to calendar 2007. Boeing and Airbus reported actual deliveries for calendar 2007
of 894 aircraft. Their deliveries for calendar 2008 are expected to increase by approximately 6%,
to about 950 aircraft. We expect our direct and indirect sales to Boeing and Airbus will benefit
from such increases.

(cid:127) Total regional and business aircraft production is expected to increase in fiscal 2009 compared to

fiscal 2008, as deliveries of business jets are expected to significantly increase with the
production of various models of very light jets. In the regional aircraft market we expect to see
growth driven by the 80-100 seat jet and 40-60 seat turboprop segments, slightly offset by
continued weakness in the 40-60 seat jet products.

(cid:127) The major trends that shape the current military/defense environment include a growing U.S.

Government defense budget and rapid expansion of information and communication
technologies. Although under pressure, the U.S. defense budget remains strong and focused on
transformation. With this continued pressure on the budget, we believe the U.S. Department of
Defense will continue to focus on affordability strategies emphasizing network-centric operations,
joint interoperability, long-range strike capability, unmanned air combat and reconnaissance
vehicles, precision guided weapons and continued privatization of logistics and support activities
as a means to improve overall effectiveness while maintaining control over costs.

(cid:127) Military sales (OEM and aftermarket) are expected to increase roughly in line with global
military budgets, which are expected to grow in the single digit range for calendar 2008
compared to calendar 2007.

RESULTS OF OPERATIONS

Fiscal year ended March 31, 2008 compared to fiscal year ended March 31, 2007

Year Ended March 31,

2008

2007

(in thousands)

Net Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$1,151,090

$937,327

Segment Operating Income . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate General and Administrative Expenses . . . . . . . . .

148,292
(21,967)

113,251
(19,352)

Total Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest Expense and Other . . . . . . . . . . . . . . . . . . . . . . . .
Charge for early extinguishment of debt . . . . . . . . . . . . . . . .
Income Tax Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Income from Continuing Operations . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . .

Loss from Discontinued Operations, net

126,325
13,422
—
37,161

75,742
(8,468)

93,899
11,706
5,088
26,129

50,976
(3,905)

Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

67,274

$ 47,071

Net sales increased by $213.8 million, or 22.8%, to $1.2 billion for the fiscal year ended March 31,

2008 from $937.3 million for the fiscal year ended March 31, 2007. The acquisitions of the assets and
businesses of Allied Aerospace Industries, Inc. (now Triumph Aerospace Systems—Newport News) and
Grand Prairie Accessory Services, LLC (now Triumph Accessory Services—Grand Prairie), which were
completed during the fiscal year ended March 31, 2007, and the acquisition of the assets and business
of B. & R. Machine & Tool Corp. (now Triumph Structures—Long Island) together contributed
$39.3 million. Excluding the effects of these acquisitions, organic sales growth was $174.5 million, or
19.0%.

The Aerospace Systems segment benefited primarily from increased sales to our OEM customers

driven by increased aircraft build rates, while the increase in sales for our Aftermarket Services
segment was the result of increased demand for our services as a result of growth in global air traffic.

Segment operating income increased by $35.0 million, or 30.9%, to $148.3 million for the fiscal
year ended March 31, 2008 from $113.3 million for the fiscal year ended March 31, 2007. Operating
income growth was a direct result of margins attained on increased sales volume as described above,
and the contribution of $2.3 million from the above-mentioned acquisitions, partially offset by increases
in litigation costs, payroll, incentive compensation, healthcare, and depreciation and amortization
expenses associated with our acquisitions.

Corporate expenses increased by $2.6 million, or 13.5%, to $22.0 million for the fiscal year ended

March 31, 2008 from $19.4 million for the fiscal year ended March 31, 2007, primarily due to increased
litigation costs, workers compensation and stock compensation costs, partially offset by an insurance
reimbursement related to product liability claims.

Interest expense and other increased by $1.7 million, or 14.7%, to $13.4 million for the fiscal year

ended March 31, 2008 compared to $11.7 million for the prior year period. This increase was due to
higher average borrowings outstanding and amortization of debt issuance costs, partially offset by lower
interest on our convertible notes issued in September 2006 as compared to the previously outstanding
Class A Senior Notes and Class B Senior Notes (collectively, the ‘‘Senior Notes’’).

During the third quarter of fiscal 2007 we recorded a charge for early extinguishment of debt
totaling $5.1 million related to the prepayment of the Senior Notes on October 4, 2006, which included
a ‘‘make-whole’’ premium of approximately $4.4 million and the write-off of unamortized debt issuance
costs related to the Senior Notes of $0.7 million.

The effective tax rate was 32.9% for the fiscal year ended March 31, 2008 and 33.9% for the fiscal
year ended March 31, 2007. The decrease in the tax rate was primarily due to final return to provision
adjustments. Additionally, both rates vary from the Federal statutory tax rate of 35% primarily due to
benefits realized from the research and development tax credit and the domestic production activities
deduction.

Loss from discontinued operations before income taxes was $13.0 million for the fiscal year ended
March 31, 2008, which included an impairment of $4.0 million, compared with a loss from discontinued
operations before income taxes of $6.0 million for the fiscal year ended March 31, 2007. The benefit
for income taxes was $4.6 million for the fiscal year ended March 31, 2008 compared to a benefit of
$2.1 million for the prior year.

Fiscal year ended March 31, 2007 compared to fiscal year ended March 31, 2006

Year Ended March 31,

2007

2006

(in thousands)

Net Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$937,327

$749,368

Segment Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate General and Administrative Expenses . . . . . . . . . . .

113,251
(19,352)

75,678
(14,507)

Total Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest Expense and Other . . . . . . . . . . . . . . . . . . . . . . . . . .
Charge for early extinguishment of debt . . . . . . . . . . . . . . . . .
Income Tax Expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Income from Continuing Operations . . . . . . . . . . . . . . . . . .
Loss from Discontinued Operations, net . . . . . . . . . . . . . . . . .

93,899
11,706
5,088
26,129

50,976
(3,905)

61,171
10,304
—
11,608

39,259
(4,744)

Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 47,071

$ 34,515

Net sales increased by $188.0 million, or 25.1%, to $937.3 million for the fiscal year ended
March 31, 2007 from $749.4 million for the fiscal year ended March 31, 2006. The acquisitions of the
assets and businesses of Excel Manufacturing, Inc. (now Triumph Structures—Wichita), Air Excellence
International, Inc. and its affiliates (now Triumph Interiors), Allied Aerospace Industries, Inc. (now
Triumph Aerospace Systems—Newport News) and Grand Prairie Accessory Services, LLC (now
Triumph Accessory Services—Grand Prairie), herein referred to collectively as the ‘‘2007 Acquisitions,’’
contributed $75.7 million of the net sales increase. Excluding the effects of the 2007 Acquisitions,
organic sales growth was $112.3 million, or 15.0%.

The Aerospace Systems segment benefited primarily from increased sales to our OEM customers

Segment operating income increased by $37.6 million, or 49.6%, to $113.3 million for the year
ended March 31, 2007 from $75.7 million for the year ended March 31, 2006. Operating income growth
was a direct result of margins attained on increased sales volume as described above and the
contribution of $22.3 million from the 2007 Acquisitions, partially offset by increases in payroll,
healthcare, litigation costs and costs associated with the startup of our new Thailand maintenance and
repair facility.

Corporate general and administrative expenses increased by $4.8 million, or 33.4%, to

$19.4 million for the year ended March 31, 2007 from $14.5 million for the year ended March 31, 2006,
primarily due to recognition of stock-based compensation, increased bonus accruals and a settlement of
a $1.1 million claim.

Interest expense and other increased by $1.4 million, or 13.6%, to $11.7 million for the year ended
March 31, 2007 from $10.3 million for the year ended March 31, 2006. This increase was due to higher
average borrowings outstanding used to fund the 2007 Acquisitions and our capital expenditures,
partially offset by lower interest on our new convertible notes issued on September 18, 2006 as
compared to the Senior Notes.

During fiscal 2007, we recorded a charge for early extinguishment of debt totaling $5.1 million
related to the prepayment of the Senior Notes on October 4, 2006, which included a ‘‘make whole’’
premium of approximately $4.4 million and the write-off of unamortized debt issuance costs related to
the Senior Notes of $0.7 million.

The effective income tax rates of 33.9% and 22.8% for the year ended March 31, 2007 and 2006,

respectively, vary from the Federal statutory tax rate of 35% primarily due to tax benefits realized from
export sales and domestic production activities and from the research and development tax credit.
Additionally, fiscal 2006 included a $2.0 million reduction of income tax resulting from adjusting the
income tax rate at which reversals of temporary differences were taxed and a $2.2 million reduction of
income tax expense related to the completion of income tax audits.

Business Segment Performance

We are a major supplier to the aerospace industry and have two operating segments: (i) Triumph

Aerospace Systems Group; and (ii) Triumph Aftermarket Services Group. Our Aerospace Systems
segment includes 34 operating locations, and the Aftermarket Services segment includes 17 operating
locations at March 31, 2008.

The Aerospace Systems segment consists of the Company’s operations which manufacture products

primarily for the aerospace OEM market. The Aerospace Systems segment’s operations design and
engineer mechanical and electromechanical controls, such as hydraulic systems and components, main
engine gearbox assemblies, accumulators and mechanical control cables. The Aerospace Systems
segment’s revenues are also derived from stretch forming, die forming, milling, bonding, machining,
welding and assembly and fabrication of various structural components used in aircraft wings, fuselages
and other significant assemblies. Further, the segment’s operations also design and manufacture
composite assemblies for floor panels, environmental control system ducts and non-structural cockpit
components. These products are sold to various aerospace OEMs on a global basis.

The Aftermarket Services segment consists of the Company’s operations that provide maintenance,

repair and overhaul services to both commercial and military markets on components and accessories
manufactured by third parties. Maintenance, repair and overhaul revenues are derived from services on
auxiliary power units, airframe and engine accessories, including constant-speed drives, cabin
compressors, starters and generators, and pneumatic drive units. In addition, the Aftermarket Services
segment’s operations repair and overhaul thrust reversers, nacelle components and flight control
surfaces. The Aftermarket Services segment’s operations also perform repair and overhaul services and
supply spare parts for various types of cockpit instruments and gauges for a broad range of commercial
airlines on a worldwide basis.

Business Segment Performance—Fiscal year ended March 31, 2008 compared to fiscal year ended

March 31, 2007

Year Ended March 31,

2008

2007

%
Change

% of Total Sales

2008

2007

(in thousands)

NET SALES
Aerospace Systems . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket Services . . . . . . . . . . . . . . . . . . . . . . .
Elimination of inter-segment sales . . . . . . . . . . . . .

$ 907,376
246,609
(2,895)

$743,742
196,526
(2,941)

22.0% 78.8% 79.3%
25.5% 21.4% 21.0%
(1.6)% (.2)% (0.3)%

Total Net Sales . . . . . . . . . . . . . . . . . . . . . . . . . . .

$1,151,090

$937,327

22.8% 100.0% 100.0%

Year Ended March 31,

2008

2007

(in thousands)

%
Change

% of Segment
Sales

2008

2007

SEGMENT OPERATING INCOME
. . . . . . . . . . . . . . . . . . . . . . . . . .
Aerospace Systems
Aftermarket Services . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$124,812
23,480
(21,967)

$101,867
11,384
(19,352)

22.5% 13.8% 13.7%
106.3% 9.5% 5.8%
(13.5)% n/a

n/a

Total Segment Operating Income . . . . . . . . . . . . . . . .

$126,325

$ 93,899

34.5% 11.0% 10.0%

Aerospace Systems: The Aerospace Systems segment net sales increased by $163.6 million, or
22.0%, to $907.4 million for the fiscal year ended March 31, 2008 from $743.7 million for the fiscal
year ended March 31, 2007. The increase was primarily due to organic sales growth to our OEM
customers of $150.5 million driven by increased aircraft build rates and the net sales contributed from
the acquisition of the assets and business of Allied Aerospace Industries, Inc. (now Triumph Aerospace
Systems—Newport News).

Aerospace Systems segment operating income increased by $22.9 million, or 22.5%, to

$124.8 million for the fiscal year ended March 31, 2008 from $101.9 million for the fiscal year ended
March 31, 2007. Operating income increased primarily due to margins attained on increased sales
volume, partially offset by an increase of $3.7 million in litigation expenses, net of insurance
reimbursements, and additional increases in payroll, incentive compensation, and healthcare costs.

Aftermarket Services: The Aftermarket Services segment net sales increased by $50.1 million, or

25.5%, to $246.6 million for the fiscal year ended March 31, 2008 from $196.5 million for the fiscal
year ended March 31, 2007. This increase was due to the sales increase associated with the acquisition
of Triumph Accessory Services—Grand Prairie, Inc., and an increase in same store sales of
$23.9 million due to new customers and products, growth in global commercial air traffic and U.S.
military maintenance requirements resulting in increased demand for repair and overhaul of auxiliary
power units and the brokering of similar units.

Aftermarket Services segment operating income increased by $12.1 million, or 106.3%, to
$23.5 million for the fiscal year ended March 31, 2008 from $11.4 million for the fiscal year ended
March 31, 2007. Operating income increased primarily due to margins attained on increased sales
volume and the contribution from the acquisition of Triumph Accessory Services—Grand Prairie, Inc.
partially offset by increases in incentive compensation, write-offs of bad debt and depreciation and
amortization expenses.

Business Segment Performance—Fiscal year ended March 31, 2007 compared to fiscal year ended

March 31, 2006

Year Ended March 31,

2007

2006

(in thousands)

%
Change

% of Total Sales

2007

2006

NET SALES
Aerospace Systems . . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket Services . . . . . . . . . . . . . . . . . . . . . . . .
Elimination of inter-segment sales . . . . . . . . . . . . . .

$743,742
196,526
(2,941)

$593,759
159,198
(3,589)

25.3% 79.3% 79.2%
23.4% 21.0% 21.2%
(18.1)% (.3)% (0.4)%

Total Net Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$937,327

$749,368

25.1% 100.0% 100.0%

Year Ended March 31,

2007

2006

(in thousands)

%
Change

% of Segment
Sales

2007

2006

SEGMENT OPERATING INCOME
Aerospace Systems . . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket Services . . . . . . . . . . . . . . . . . . . . . . . .
Corporate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$101,867
11,384
(19,352)

$ 67,122
8,556
(14,507)

51.8% 13.7% 11.3%
5.8% 5.4%
33.1%
n/a
33.4%

n/a

Total Segment Operating Income . . . . . . . . . . . . . . .

$ 93,899

$ 61,171

53.5% 10.0% 8.2%

Aerospace Systems: The Aerospace Systems segment net sales increased by $150.0 million, or
25.3%, to $743.7 million for the year ended March 31, 2007 from $593.8 million for the year ended
March 31, 2006. The increase was primarily due to increased sales to our OEM customers of
$94.2 million driven by increased aircraft build rates and the net sales contributed from the acquisition
of the assets and business of Excel Manufacturing, Inc. (now Triumph Structures-Wichita) and Allied
Aerospace Industries, Inc. (now Triumph Aerospace Systems—Newport News) of $55.8 million.

Aerospace Systems segment operating income increased by $34.7 million, or 51.8%, to

$101.9 million for the year ended March 31, 2007 from $67.1 million for the year ended March 31,
2006. Operating income increased primarily due to margins attained on increased sales volume and the
margins contributed from the Triumph Structures—Wichita and Triumph Aerospace Systems—Newport
News acquisitions of $19.7 million, partially offset by increases in payroll, research and development
costs, litigation costs and healthcare costs.

Aftermarket Services: The Aftermarket Services segment net sales increased by $37.3 million, or

23.4%, to $196.5 million for the year ended March 31, 2007 from $159.2 million for the year ended
March 31, 2006. This increase was primarily due to organic growth of $17.4 million which was
principally associated with global air traffic growth, resulting in increased demand for our repair and
overhaul services and $19.9 million of net sales contributed from the acquisition of the assets and
business of Air Excellence International, Inc. and its affiliates (now Triumph Interiors) and Grand
Prairie Accessory Services, LLC (now Triumph Accessory Services—Grand Prairie).

Aftermarket Services segment operating income increased by $2.8 million, or 33.1%, to

$11.4 million for the year ended March 31, 2007 from $8.6 million for the year ended March 31, 2006.
Operating income increased primarily due to margins attained on increased sales volume and the
contribution from the acquisition of Triumph Interiors and Triumph Accessory Services—Grand Prairie
of $2.6 million partially offset by increases in payroll, costs associated with the startup of our new
Thailand maintenance and repair facility and a charge related to a change in our method of
recognizing revenue for the power by the hour contracts.

Liquidity and Capital Resources

Our working capital needs are generally funded through cash flows from operations and
borrowings under our credit arrangements. During the year ended March 31, 2008, we generated
approximately $51.1 million of cash flows from operating activities, used approximately $125.2 million
in investing activities and generated approximately $79.8 million in financing activities.

In February 2008, the Company acquired the assets and business of B. & R. Machine & Tool
Corp. (now Triumph Structures—Long Island), located in Westbury, New York. The total cash paid at
closing for the acquisition of $67.0 million was funded by borrowings under the Company’s revolving
credit facility. Included in the purchase agreement is an earnout note for $13.0 million. Payments under
the earnout note are contingent upon the achievement of certain earnings levels during the earnout
period. The maximum amounts payable in respect of fiscal 2009, 2010 and 2011, respectively, are
$3.5 million, $4.5 million and $5.0 million, respectively.

In April 2006, the Company acquired the assets and business of Excel Manufacturing, Inc. (now
Triumph Structures—Wichita), located in Wichita, Kansas. In April 2006, the Company also acquired
the assets and business of Air Excellence International, Inc. and its affiliates (now Triumph Interiors)
which is headquartered in Pittsburgh, Pennsylvania, and operates two other strategically located
facilities: Dallas, Texas, and Shannon, Ireland. In November 2006, the Company acquired Allied
Aerospace Industries, Inc. (now Triumph Aerospace Systems—Newport News) located in Newport
News, Virginia. In January 2007, the Company acquired Grand Prairie Accessory Services, LLC (now
Triumph Accessory Services—Grand Prairie), located in Grand Prairie, Texas. The total cash paid at
closing for these acquisitions of approximately $136.8 million was funded by borrowings under the
Company’s revolving credit facility.

During February 2008, the Company exercised existing authority to make stock repurchases and
repurchased 220,000 shares of its outstanding shares under the program for an aggregate consideration
of $12.3 million, funded by borrowings under the Company’s existing amended and restated credit
agreement (the ‘‘Credit Facility’’). In February 2008, the Company’s Board of Directors then authorized
an increase in the Company’s existing stock repurchase program by up to an additional 500,000 shares
of its common stock. As a result, as of May 15, 2008, the Company remains able to purchase an
additional 500,800 shares. Repurchases may be made from time to time in open market transactions,
block purchases, privately negotiated transactions or otherwise at prevailing prices. No time limit has
been set for completion of the program.

On September 18, 2006, the Company issued $201.3 million in convertible senior subordinated
notes (the ‘‘Notes’’). The Notes are direct, unsecured, senior subordinated obligations of the Company,
and rank (i) junior in right of payment to all of the Company’s existing and future senior indebtedness,
(ii) equal in right of payment with any other future senior subordinated indebtedness, and (iii) senior in
right of payment to all subordinated indebtedness.

The Company received net proceeds from the sale of the Notes of approximately $195.0 million

after deducting offering expenses of approximately $6.3 million. The use of the net proceeds from the
sale was for prepayment of the Company’s outstanding Senior Notes, including a make-whole premium,
fees and expenses in connection with the prepayment, and to repay a portion of the outstanding
indebtedness under the Company’s Credit Facility. Approximately $6.3 million in debt issuance costs
have been recorded as other assets in the accompanying consolidated balance sheets. Debt issuance
costs are being amortized over a period of five years.

during the applicable interest period if the average trading price of a Note for the five consecutive
trading days ending on the third trading day immediately preceding the first day of the relevant
six-month period equals or exceeds 120% of the principal amount of the Notes. The contingent interest
payable per Note in respect of any six-month period will equal 0.25% per annum calculated on the
average trading price of a Note for the relevant five trading day period. This contingent interest feature
represents an embedded derivative. Since it is in the control of the Company to call the Notes at any
time after October 6, 2011, the value of the derivative was determined to be de minimis. Accordingly,
no value has been assigned at issuance or at March 31, 2008.

The Notes mature on October 1, 2026 unless earlier redeemed, repurchased or converted. The
Company may redeem the Notes for cash, either in whole or in part, anytime on or after October 6,
2011 at a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus
accrued and unpaid interest, including contingent interest and additional amounts, if any, up to but not
including the date of redemption. In addition, holders of the Notes will have the right to require the
Company to repurchase for cash all or a portion of their Notes on October 1, 2011, 2016 and 2021, at
a repurchase price equal to 100% of the principal amount of the Notes to be repurchased plus accrued
and unpaid interest, including contingent interest and additional amounts, if any, up to, but not
including, the date of repurchase. The Notes are convertible into the Company’s common stock at a
rate equal to 18.3655 shares per $1,000 principal amount of the Notes (equal to an initial conversion
price of approximately $54.45 per share), subject to adjustment as described in the Indenture. Upon
conversion, the Company will deliver to the holder surrendering the Notes for conversion, for each
$1,000 principal amount of Notes, an amount consisting of cash equal to the lesser of $1,000 and the
Company’s total conversion obligation and, to the extent that the Company’s total conversion obligation
exceeds $1,000, at the Company’s election, cash or shares of the Company’s common stock in respect
of the remainder.

The Notes are eligible for conversion upon meeting certain conditions as provided in the indenture

agreement. For the periods from October 1, 2007 through December 31, 2007 and January 1, 2008
through March 31, 2008, the Notes were eligible for conversion; however, during this period, none of
the Notes was converted.

To be included in the calculation of diluted earnings per share, the average price of the Company’s

common stock for the fiscal year must exceed the conversion price per share of $54.45. The average
price of the Company’s stock for the fiscal year ended March 31, 2008 was $68.95, therefore, 777,059
additional shares were included in the diluted earnings per share calculation. No additional shares were
included in the diluted earnings per share calculation for the fiscal year ended March 31, 2007 since
the average price of the Company’s stock did not exceed the conversion price.

If the Company undergoes a fundamental change, holders of the Notes will have the right, subject
to certain conditions, to require the Company to repurchase for cash all or a portion of their Notes at
a repurchase price equal to 100% of the principal amount of the Notes to be repurchased plus accrued
and unpaid interest, including contingent interest and additional amounts, if any. The carrying amount
of convertible senior subordinated notes approximates fair value.

On October 4, 2006, the Company prepaid all of its outstanding Senior Notes and, accordingly, the

rights of the holders of the Senior Notes under the Note Purchase Agreement, dated November 21,
2002, between the Company and such holders, as amended, ceased. The Senior Notes were prepaid
with the proceeds from the Company’s sale of the Notes as discussed above. Immediately prior to
prepayment, $68.4 million aggregate principal amount of Class A Senior Notes, which carried a fixed
rate of interest of 6.06%, were outstanding, and $56.0 million aggregate amount of Class B Senior
Notes, which carried a fixed rate of interest of 5.59%, were outstanding. If the Company had not
prepaid the outstanding Senior Notes, they would have matured on December 2, 2012, subject to a
requirement under the Note Purchase Agreement that the Company annually prepay $8.0 million of

the outstanding Class B Senior Notes starting on December 2, 2006. The Senior Notes were senior
unsecured obligations of the Company and ranked junior in right of payment to the rights of the
Company’s secured creditors to the extent of their security in the Company’s assets, equal in right of
payment to the rights of creditors under the Company’s other existing and future unsecured
unsubordinated obligations, senior in right of payment to the rights of creditors under obligations
expressly subordinated to the Senior Notes, and effectively subordinated to secured and unsecured
creditors of the Company’s subsidiaries. The prepayment was made upon proper notice to the holders
of the Senior Notes at a price equal to 100% of the principal amount of the outstanding Senior
Notes being prepaid, plus accrued and unpaid interest of approximately $2.5 million, plus a ‘‘make
whole’’ premium of approximately $4.4 million based on the value of the remaining scheduled interest
payments on the Senior Notes being prepaid. The Company expensed the ‘‘make whole’’ premium of
$4.4 million as well as unamortized debt issuance costs related to the Senior Notes of $0.7 million in
the third quarter of fiscal 2007.

The indentures under the Company’s debt agreements and the Credit Facility contain restrictions

and covenants which include limitations on the Company’s ability to incur additional indebtedness,
issue stock options or warrants, make certain restricted payments and acquisitions, create liens, enter
into transactions with affiliates, sell substantial portions of its assets and pay cash dividends. Additional
covenants require compliance with financial tests, including leverage and interest coverage ratio.

At March 31, 2008, there were $193.8 million in borrowings and $5.9 million in letters of credit
outstanding under the Credit Facility. At March 31, 2007, there were $100.8 million in borrowings and
$6.3 million in letters of credit outstanding under the Credit Facility. The level of unused borrowing
capacity under the Company’s revolving Credit Facility varies from time to time depending in part upon
its compliance with financial and other covenants set forth in the related agreement. The Company is
currently in compliance with all such covenants. As of March 31, 2008, the Company had borrowing
capacity under the Credit Facility of $150.3 million, after reductions for borrowings and letters of credit
outstanding.

Effective April 2007, the Company entered into a settlement agreement with a customer relating

to a long-term supply agreement (‘‘LTSA’’). The LTSA is related to the Company’s acquisition of Rolls-
Royce Gear Systems, Inc., in fiscal 2004. The Company has been producing the component parts for
this LTSA at a loss for approximately two years which has been reserved for through a loss contract
reserve. The agreement provides for the parties to establish a transition plan that provides for the
customer to re-source the component parts from other suppliers, essentially terminating the Company’s
requirement to provide future deliveries of these component parts. The agreement establishes a date of
no later than December 31, 2008 for completion of the re-sourcing effort. Additionally, the Company is
required to make a total of four payments of $0.5 million upon successful transition of the component
parts by the customer to other vendors. A payment of $0.5 million was made in October 2007. The
Company recorded the estimated impact of this settlement in its March 31, 2007 balance sheet, which
did not result in a significant adjustment to the recorded loss reserve. As of March 31, 2007 and
March 31, 2008, the recorded loss reserve was $7.2 million and $2.9 million, respectively. If the
transition is completed earlier than December 31, 2008, or the quantity, price or cost of units delivered
by the Company is different than anticipated under the settlement agreement, an adjustment to the
recorded loss reserve may be required. Because we cannot determine the extent of re-sourcing that may
occur or the timing of the re-sourcing, we monitor progress and make appropriate adjustments, as may
be necessary, to the loss contract reserve on a periodic basis.

Capital expenditures were approximately $62.4 million for the fiscal year ended March 31, 2008

primarily for manufacturing machinery and equipment. We funded these expenditures through
borrowings under our Credit Facility. We expect capital expenditures to be in the range of $55.0 to
$70.0 million for our fiscal year ending March 31, 2009. The expenditures are expected to be used
mainly to expand capacity or replace old equipment at several facilities.

Our expected future cash flows for the next five years for long term debt, leases and other

obligations are as follows:

Contractual Obligations

Payments Due by Period

Total

Less than
1 year

1-3 years

4-5 years

After 5
Years

Debt Principal(1) . . . . . . . . . . . . . . . . . . . . . . .
Debt-Interest(2) . . . . . . . . . . . . . . . . . . . . . . . .
Operating Leases . . . . . . . . . . . . . . . . . . . . . . .
Purchase Obligations . . . . . . . . . . . . . . . . . . . .

$419,813
20,195
70,149
374,753

1,010
5,575
18,333
288,725

(in thousands)
$211,111
11,091
17,612
79,736

$200,048
2,993
12,764
6,218

$ 7,644
536
21,440
74

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$884,910

$313,643

$319,550

$222,023

$29,694

(1) Included in the Company’s balance sheet at March 31, 2008.

(2) Includes fixed-rate interest only.

The above table excludes unrecognized tax benefits of $2.9 million as of March 31, 2008 since we

cannot predict with reasonable certainty the timing of cash settlements with the respective taxing
authorities.

The table also excludes our pension benefit obligations. We made pension contributions of

$2.7 million and $0.6 million in fiscal 2008 and 2007, respectively. These contributions include payments
related to a supplemental executive retirement plan of $2.3 million in fiscal 2008, and payments to our
union pension plans of $0.4 million and $0.6 million in fiscal 2008 and 2007, respectively. We expect to
make pension contributions of $3.2 million to our pension plans during fiscal 2009. See Note 10,
‘‘Employee Benefit Plans’’ of our Consolidated Financial Statements for a further discussion of our
pension and other employee benefit plans.

We believe that cash generated by operations and borrowings under the Credit Facility will be
sufficient to meet anticipated cash requirements for our current operations. However, we have a stated
policy to grow through acquisitions and are continuously evaluating various acquisition opportunities.
As a result, we currently are pursuing the potential purchase of a number of candidates. In the event
that more than one of these transactions are successfully consummated, the availability under the
Credit Facility might be fully utilized and additional funding sources may be needed. There can be no
assurance that such funding sources will be available to us on terms favorable to us, if at all.

CRITICAL ACCOUNTING POLICIES

Critical accounting policies are those accounting policies that can have a significant impact on the

presentation of our financial condition and results of operations, and that require the use of complex
and subjective estimates based upon past experience and management’s judgment. Because of the
uncertainty inherent in such estimates, actual results may differ from these estimates. Below are those
policies applied in preparing our financial statements that management believes are the most
dependent on the application of estimates and assumptions. For additional accounting policies, see
Note 2 of ‘‘Notes to Consolidated Financial Statements.’’

Allowance for Doubtful Accounts

Trade receivables are presented net of an allowance for doubtful accounts. In determining the

appropriate allowance, we consider a combination of factors, such as industry trends, our customers’
financial strength and credit standing, and payment and default history. The calculation of the required
allowance requires a judgment as to the impact of these and other factors on the ultimate realization of

our trade receivables. We believe that these estimates are reasonable and historically have not resulted
in material adjustments in subsequent periods when the estimates are adjusted to actual amounts.

Inventories

Inventories are stated at the lower of cost or market using the average cost or specific

identification methods. We write down our inventory for estimated obsolescence or
unmarketable inventory equal to the difference between the cost of inventory and estimated market
value based upon assumptions about future demand and market conditions. If actual market
conditions are less favorable than those anticipated, inventory adjustments may be required. We believe
that these estimates are reasonable and historically have not resulted in material adjustments in
subsequent periods when the estimates are adjusted to actual amounts.

Revenue Recognition

Revenues are recognized in accordance with the contract terms when products are shipped,

Reserves for contract losses are accrued when estimated costs to complete exceed expected future

revenues. The Company’s policy with respect to sales returns and allowances generally provides that the
customer may not return products or be given allowances, except at the Company’s option. Accruals for
sales returns, other allowances, and estimated warranty costs are provided at the time of shipment
based upon past experience.

Goodwill and Intangible Assets

Under Statement of Financial Accounting Standards (‘‘SFAS’’) No. 142, Goodwill and Intangible

Assets (‘‘SFAS No. 142’’), goodwill and intangible assets with indefinite lives are not amortized; rather,
they are tested for impairment on at least an annual basis. Additionally, intangible assets with finite
lives continue to be amortized over their useful lives.

The Company’s operating segments of Aerospace Systems and Aftermarket Services are also the

reporting units under SFAS No. 142. Each operating segment has a president who is responsible for
managing the segment and reporting to the president and CEO of the Company, the Company’s Chief
Operating Decision Maker (‘‘CODM’’), as defined in SFAS No. 131, Disclosures about Segments of an
Enterprise and Related Information. Each of the operating segments is comprised of a number of
operating units which are considered to be components under SFAS No. 142. The operating units, for
which discrete financial information exists, are aggregated for purposes of goodwill impairment testing.
The Company’s acquisition strategy is to acquire companies that complement and enhance the
capabilities of the operating segments of the Company. Each acquisition is assigned to either the
Aerospace Systems reporting unit or the Aftermarket Services reporting unit. The goodwill that results
from each acquisition is also assigned to the reporting unit to which the acquisition is allocated,
because it is that reporting unit which is intended to benefit from the synergies of the acquisition.

SFAS No. 142 requires a two-step impairment test for goodwill. The first step is to compare the
carrying amount of the reporting unit’s assets to the fair value of the reporting unit. If the fair value
exceeds the carrying value, no further work is required and no impairment loss is recognized. If the
carrying amount exceeds the fair value, then the second step is required to be completed, which
involves allocating the fair value of the reporting unit to each asset and liability, with the excess being

implied goodwill. An impairment loss occurs if the amount of the recorded goodwill exceeds the
implied goodwill. The determination of the fair value of our reporting units is based, among other
things, on estimates of future operating performance of the reporting unit being valued. We are
required to complete an impairment test for goodwill and record any resulting impairment losses at
least annually. Changes in market conditions, among other factors, may have an impact on these
estimates and require interim impairment assessments. We completed our required annual impairment
test in the fourth quarter of fiscal 2008 and determined that there was no impairment. For our
impairment test, we use market multiples from an external source for an average of stock price to
earnings before interest, taxes, depreciation and amortization (‘‘EBITDA’’) for certain companies in the
aerospace and defense markets in computing the fair value of each reporting unit. In the event that
market multiples for stock price to EBITDA in the aerospace and defense markets decrease, or the
expected EBITDA for our reporting units decreases, a goodwill impairment charge may be required,
which would adversely affect our operating results and financial condition. No impairment charges have
been incurred since the adoption of SFAS No. 142.

Recently Issued Accounting Pronouncements

In May 2008, the Financial Accounting Standards Board (‘‘FASB’’) issued FASB Staff Position
(‘‘FSP’’) No. APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon
Conversion (Including Partial Cash Settlement) (‘‘FSP APB 14-1’’). FSP APB 14-1 clarifies that
convertible debt instruments that may be settled in cash upon conversion (including partial cash
settlement) are not addressed by paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt
and Debt Issued with Stock Purchase Warrants. Additionally, this FSP specifies that issuers of such
instruments should separately account for the liability and equity components in a manner that will
reflect the entity’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent
periods. This FSP is effective for financial statements issued for fiscal years beginning after
December 15, 2008, and interim periods within those fiscal years. Early adoption is not permitted. The
Company is currently evaluating the impact of the adoption of FSP APB 14-1 on the Company’s
financial condition and results of operations.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and
Hedging Activities (‘‘SFAS 161’’), which amends and expands the disclosure requirements of FASB
Statement No. 133, Accounting for Derivative Instruments and Hedging Activities (‘‘SFAS 133’’), with the
intent to provide users of financial statements with an enhanced understanding of: (a) how and why an
entity uses derivative instruments; (b) how derivative instruments and related hedged items are
accounted for under SFAS 133 and its related interpretations; and (c) how derivative instruments and
related hedged items affect an entity’s financial position, financial performance and cash flows.
SFAS 161 requires enhanced qualitative disclosures about objectives and strategies for using derivatives,
quantitative disclosures about fair value amounts of and gains and losses on derivative instruments and
enhanced disclosures about credit-risk-related contingent features in derivative instruments. This
statement applies to all entities and all derivative instruments. SFAS 161 is effective for financial
statements issued for fiscal years and interim periods beginning after November 15, 2008.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations (‘‘SFAS 141(R)’’)

and SFAS No. 160, Accounting and Reporting of Noncontrolling Interests in Consolidated Financial
Statements, an amendment of ARB No. 51 (‘‘SFAS 160). SFAS 141(R) and SFAS 160 significantly change
the accounting for and reporting of business combination transactions and noncontrolling (minority)
interests. SFAS 141(R) and SFAS 160 are effective for fiscal years beginning after December 15, 2008.
SFAS 141(R) and SFAS 160 are effective prospectively; however, the reporting provisions of SFAS 160
are effective retroactively. SFAS 141(R) is required to be adopted concurrently with SFAS 160. The
Company is currently evaluating the impact of the adoption of SFAS 141(R) and SFAS 160 on the
Company’s financial condition and results of operations.

In July 2007, the FASB ratified Emerging Issues Task Force Issue No. 06-11 Accounting for the
Income Tax Benefits of Dividends on Share-Based Payments Awards (‘‘EITF 06-11’’). EITF 06-11 requires
companies to recognize the tax benefits of dividends on unvested share-based payments in equity and
reclassify those tax benefits from additional paid-in capital (‘‘APIC’’) to the income statement when the
related award is forfeited or no longer expected to vest. The amount reclassified is limited to the
amount of the Company’s APIC pool balance on the reclassification date. EITF 06-11 is effective, on a
prospective basis, for fiscal years beginning after December 15, 2007. The Company has determined the
impact of adopting EITF 06-11 will not be material to the Company’s results of operations or financial
condition.

In March 2007, the FASB ratified Emerging Issues Task Force Issue No. 06-10 Accounting for
Collateral Assignment Split-Dollar Life Insurance Agreements (‘‘EITF 06-10’’). EITF 06-10 provides
guidance for determining a liability for the post-retirement benefit obligation as well as recognition and
measurement of the associated asset on the basis of the terms of the collateral assignment agreement.
EITF 06-10 is effective for fiscal years beginning after December 15, 2007. The Company has
determined the impact of adopting EITF 06-10 will not be material to the Company’s results of
operations or financial condition.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and

Financial Liabilities, including an amendment of FASB Statement No. 115 (‘‘SFAS 159’’). SFAS 159
permits the Company to elect fair value as the initial and subsequent measurement attribute for certain
financial assets and liabilities that are not otherwise required to be measured at fair value, on an
instrument-by-instrument basis. If the Company elects the fair value option, it would be required to
recognize changes in fair value in its earnings. This standard also establishes presentation and
disclosure requirements designed to improve comparisons between entities that choose different
measurement attributes for similar types of assets and liabilities. SFAS 159 is effective for fiscal years
beginning after November 15, 2007 although early adoption is permitted. The Company does not expect
to elect the fair value measurement option provided by SFAS 159.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (‘‘SFAS 157’’).

SFAS 157 does not require additional fair value measures but defines fair value, establishes a
framework for measuring fair value in accordance with generally accepted accounting principles and
expands disclosures about fair value measurements. SFAS 157 is effective for the fiscal years beginning
after November 15, 2007; however, the FASB has agreed to a one-year deferral of the adoption of
SFAS 157 for non-financial assets and liabilities. The Company’s evaluation of the impact of the
adoption of SFAS 157 is ongoing; however, the Company does not expect the impact of SFAS 157 on
the Company’s financial condition and results of operations to be material.

In June 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes,

an interpretation of SFAS No. 109 (‘‘FIN 48’’). FIN 48 creates a single model to address accounting for
uncertainty in tax positions by prescribing a minimum recognition threshold a tax position is required to
meet before being recognized in the financial statements. FIN 48 also provides guidance on
derecognition, measurement, classification, interest and penalties, accounting in interim periods,
disclosure and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006. In
connection with its adoption of FIN 48 on April 1, 2007, the Company recognized a charge of
approximately $0.3 million to retained earnings. See Note 6 of ‘‘Notes to Consolidated Financial
Statements’’ for additional information regarding the Company’s uncertain tax positions.

Stock-Based Compensation

Through March 31, 2006, the Company used the accounting method set forth in Accounting
Principles Board Opinion No. 25 (‘‘APB 25’’) and related interpretations in accounting for its employee
stock options. Under APB 25, generally, when the exercise price of the Company’s employee stock

options equals the market price of the underlying stock on the date of grant, no compensation cost is
recognized.

In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment, which requires

companies to measure compensation cost for all share-based payments (including employee stock
options) at fair value. The Company adopted SFAS No. 123R, using the modified-prospective transition
method, beginning on April 1, 2006, and therefore began to expense the fair value of all outstanding
options over their remaining vesting periods to the extent the options were not fully vested as of the
adoption date and began to expense the fair value of all options granted subsequent to March 31, 2006
over their requisite service periods. SFAS No. 123R also requires the benefits of tax deductions in
excess of recognized compensation expense to be reported as a financing cash flow ($1.7 million and
$1.9 million for fiscal years ended March 31, 2008 and March 31, 2007, respectively), rather than an
operating cash flow. Stock-based compensation expense related to employee stock options recognized
under SFAS No. 123R for fiscal 2008 and fiscal 2007 was $2.8 million and $2.5 million, respectively,
and in accordance with Staff Accounting Bulletin (‘‘SAB’’) 107 the Company has classified share-based
compensation within selling, general and administrative expenses to correspond with the same line
item as the majority of the cash compensation paid to employees. Previous periods have not been
restated. The Company estimates it will record share-based compensation expense of approximately
$3.3 million in fiscal 2009. This estimate may be impacted by potential changes to the structure of the
Company’s share-based compensation plans which could impact the number of stock options granted in
fiscal 2009, changes in valuation assumptions, and changes in the market price of the Company’s
common stock, among other things and, as a result, the actual share-based compensation expense in
fiscal 2009 may differ from the Company’s current estimate. (See Note 11 of ‘‘Notes to Consolidated
Financial Statements’’ for further details).

Forward-Looking Statements

This report contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 relating to our future operations and prospects, including statements
that are based on current projections and expectations about the markets in which we operate, and
management’s beliefs concerning future performance and capital requirements based upon current
available information. Such statements are based on management’s beliefs as well as assumptions made
by and information currently available to management. When used in this document, words like ‘‘may,’’
‘‘might,’’ ‘‘will,’’ ‘‘expect,’’ ‘‘anticipate,’’ ‘‘believe,’’ ‘‘potential,’’ and similar expressions are intended to
identify forward-looking statements. Actual results could differ materially from management’s current
expectations. For example, there can be no assurance that additional capital will not be required or that
additional capital, if required, will be available on reasonable terms, if at all, at such times and in such
amounts as may be needed by us. In addition to these factors, among other factors that could cause
actual results to differ materially, are uncertainties relating to the integration of acquired businesses,
general economic conditions affecting our business segments, dependence of certain of our businesses
on certain key customers as well as competitive factors relating to the aviation and metals industries.
For a more detailed discussion of these and other factors affecting us, see the risk factors described in
‘‘Item 1A. Risk Factors’’.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk

Our primary exposure to market risk consists of changes in interest rates on borrowings. An
increase in interest rates would adversely affect our operating results and the cash flow available after
debt service to fund operations and expansion. In addition, an increase in interest rates would adversely
affect our ability to pay dividends on our common stock, if permitted to do so under certain of our
debt arrangements, including the Credit Facility. We manage exposure to interest rate fluctuations by

optimizing the use of fixed and variable rate debt. As of March 31, 2008, approximately 52% of our
debt is fixed rate debt. In March 2008, the Company entered into a thirty-nine month interest rate
swap to exchange floating rate for fixed rate interest payments to hedge against interest rate changes
on $85.0 million of the Company’s outstanding balance of the Credit Facility. The Company utilizes the
swap to provide protection to meet actual exposures and does not speculate in derivatives. The net
effect of the spread between the floating rate (30-day LIBOR) and the fixed rate (2.925%) will be
reflected as an adjustment to interest expense in the period incurred. No gain or loss was recognized in
earnings during fiscal year 2008. The Company estimates that $0.6 million of losses presently in
accumulated other comprehensive income will be reclassified into earnings during fiscal year 2009. The
information below summarizes our market risks associated with debt obligations and should be read in
conjunction with Note 7 of ‘‘Notes to Consolidated Financial Statements.’’

The following table presents principal cash flows and the related interest rates. Fixed interest rates

disclosed represent the weighted average rate as of March 31, 2008. Variable interest rates disclosed
fluctuate with the LIBOR, federal funds rates and other weekly rates and represent the weighted
average rate at March 31, 2008.

Expected Years of Maturity

Fixed rate cash flows

Next 12
Months Months

13-24

25-36
Months

37-48
Months

49-60
Months

Thereafter

Total

(in thousands) . . . . . . . . . . .

$ 933

$4,400

$206,649

5,809

$ 490

$1,830

$220,111

Weighted average interest

rate (%) . . . . . . . . . . . . . . . .

6.07

3.76

2.65

3.56

5.79

4.01

Variable rate cash flows

(in thousands) . . . . . . . . . . .

$ 77

$193,750

$5,814

$199,702

Weighted average interest

rate (%) . . . . . . . . . . . . . . . .

6.17

—

3.80

—

4.21

There are no other significant market risk exposures.

Item 8. Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Triumph Group, Inc.

We have audited the accompanying consolidated balance sheets of Triumph Group, Inc. as of
March 31, 2008 and 2007, and the related consolidated statements of income, stockholders’ equity, and
cash flows for each of the three years in the period ended March 31, 2008. Our audits also included the
financial statement schedule listed in the index at Item 15(a). These financial statements and
schedule are the responsibility of the Company’s management. Our responsibility is to express an
opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all
material respects, the consolidated financial position of Triumph Group, Inc. at March 31, 2008 and
2007, and the consolidated results of its operations and its cash flows for each of the three years in the
period ended March 31, 2008, in conformity with U.S. generally accepted accounting principles. Also, in
our opinion, the related financial statement schedule, when considered in relation to the basic financial
statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Notes 2 and 6, the Company changed its method of accounting for uncertain tax
positions in 2008. As discussed in Note 2, the Company changed its method of accounting for employee
stock compensation plans in 2007. Also, as discussed in Note 10, the Company changed its method of
accounting for defined benefit pension and other postretirement plans in 2007.

We also have audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), Triumph Group, Inc.’s internal control over financial reporting as of
March 31, 2008, based on criteria established in Internal Control-Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission and our report dated May 27,
2008 expressed an unqualified opinion thereon.

/S/ ERNST & YOUNG LLP

Philadelphia, Pennsylvania
May 27, 2008

TRIUMPH GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)

March 31,

2008

2007

Current assets:

ASSETS

Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable, less allowance for doubtful accounts of $4,723

and $3,857 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Assets held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

13,738

7,243

207,975
361,667
24,763
1,450
5,207

614,800
324,095
383,740
78,488
13,712

168,372
296,080
28,643
2,045
6,713

509,096
283,681
339,930
69,919
17,261

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$1,414,835

$1,219,887

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities related to assets held for sale . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current portion of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 120,117
83,397
4,587
1,509
1,010

$ 101,332
75,582
7,545
1,484
5,702

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

210,620

191,645

Long-term debt, less current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes payable, non-current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

418,803
1,437
91,246

310,481
—
90,398

Stockholders’ equity:

Common stock, $.001 par value, 50,000,000 shares authorized, 16,517,374

and 16,469,617 shares issued . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital in excess of par value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Treasury stock, at cost, 213,950 and 0 shares . . . . . . . . . . . . . . . . . . . . . . .
Accumulated other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . .
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

16
288,154
(12,003)
2,950
413,612

16
278,177
—
(120)
349,290

Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

692,729

627,363

Total liabilities and stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . .

$1,414,835

$1,219,887

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

Year ended March 31,

2008

2007

2006

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$1,151,090

$937,327

$749,368

Operating costs and expenses:

Cost of products sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . .

822,288
159,262
43,215

671,838
135,887
35,703

549,307
108,063
30,827

Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Charge for early extinguishment of debt . . . . . . . . . . . . . . . . . . . . .

Income from continuing operations before income taxes . . . . . . . . .
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,024,765

843,428

688,197

126,325
13,422
—

112,903
37,161

93,899
11,706
5,088

77,105
26,129

61,171
10,304
—

50,867
11,608

Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . .
Loss from discontinued operations, net

75,742
(8,468)

50,976
(3,905)

39,259
(4,744)

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

67,274

$ 47,071

$ 34,515

Earnings per share—basic:

Income from continuing operations . . . . . . . . . . . . . . . . . . . . . .
Loss from discontinued operations, net . . . . . . . . . . . . . . . . . . . .

Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Weighted average common shares outstanding—basic . . . . . . . . . . .

Earnings per share—diluted:

Income from continuing operations . . . . . . . . . . . . . . . . . . . . . .
Loss from discontinued operations, net . . . . . . . . . . . . . . . . . . . .

Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.59
(0.51)

4.08

16,497

4.32
(0.48)

3.84

3.14
(0.24)

2.90

16,220

3.11
(0.24)

2.87

2.47
(0.30)

2.17

15,920

2.45
(0.30)

2.15

Weighted average common shares outstanding—diluted . . . . . . . . .

17,540

16,413

16,060

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Dollars in thousands)

Balance at March 31, 2005 . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . .

Foreign currency translation

adjustment . . . . . . . . . . . . . . . . . .

Minimum pension liability adjustment,

net of income tax benefit of $140 . . .

Unrealized gain on securities, net of

income taxes of $37 . . . . . . . . . . . .

Total comprehensive income . . . . . .

Exercise of stock options . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . .

Balance at March 31, 2006 . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . .
Foreign currency translation

adjustment . . . . . . . . . . . . . . . . . .

Minimum pension liability adjustment,

net of income tax benefit of $330 . . .

Reclassification adjustment for realized
gain on securities, net of income tax
benefit of $37 . . . . . . . . . . . . . . . .

Total comprehensive income . . . . . .

Adoption of SFAS No. 158, net of

income taxes of $948 . . . . . . . . . . .
Exercise of stock options . . . . . . . . . .
Cash dividends ($0.12 per share) . . . . .
Share-based compensation . . . . . . . . .
Excess tax benefit from exercise of

stock options

. . . . . . . . . . . . . . . .

Balance at March 31, 2007 . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . .
Foreign currency translation

adjustment . . . . . . . . . . . . . . . . . .

Pension liability adjustment, net of

income tax benefit of $396 . . . . . . .

Change in fair value of interest rate
swap, net of income tax benefit of
$196 . . . . . . . . . . . . . . . . . . . . . .

Total comprehensive income . . . . . .

Adoption of FIN. 48 . . . . . . . . . . . . .
Purchase of 220,000 shares of common

stock . . . . . . . . . . . . . . . . . . . . . .
Exercise of stock options . . . . . . . . . .
Cash dividends ($0.16 per share) . . . . .
Share-based compensation . . . . . . . . .
Excess tax benefit from exercise of

stock options

. . . . . . . . . . . . . . . .

Common
Stock
All Classes

Capital in
Excess of
Par Value

Treasury
Stock

Accumulated
Other
Comprehensive
(Loss) Income

$16

$259,448

$ (3,057)

306

Retained
Earnings

$269,950
34,515

Total

$526,663
34,515

(699)

169

(3)
679

2,602

(285)

(699)

169

34,047

2,314
679

260,124

(455)

(162)

304,180
47,071

563,703
47,071

1,155

562

(62)

(1,613)

13,588

455

2,524

1,941

278,177

—

(120)

(1,961)

349,290
67,274

2,731

674

(335)

1,155

562

(62)

48,726

(1,613)
14,043
(1,961)
2,524

1,941

627,363
67,274

2,731

674

(335)

70,344

(12,342)
339

5,431

2,809

1,737

(291)

(2,661)

(12,342)
5,770
(2,661)
2,809

1,737

Balance at March 31, 2008 . . . . . . . . . .

$16

$288,154

$(12,003)

$ 2,950

$413,612

$692,729

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

Operating Activities
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Adjustments to reconcile net income to net cash provided by

operating activities:
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . .
Other amortization included in interest expense . . . . . . . . . . . . .
Provision for doubtful accounts receivable . . . . . . . . . . . . . . . . . .
Provision for deferred income taxes . . . . . . . . . . . . . . . . . . . . . .
Employee stock compensation . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in other current assets and liabilities, excluding the

effects of acquisitions:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other current assets . . . . . . . . . . . . . . . .
Accounts payable, accrued expenses and income taxes payable . . .
Changes in discontinued operations . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Year ended March 31,

2008

2007

2006

$ 67,274

$ 47,071

$ 34,515

43,215
1,621
1,643
8,380
2,809

35,703
1,835
1,047
5,969
2,524

30,827
748
983
(489)
—

(36,112)
(54,903)
591
21,665
(3,913)
(1,148)

(9,571)
(51,330)
(623)
16,305
(792)
(2,699)

(18,596)
(15,019)
(903)
5,751
(3,405)
5,182

Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . .

51,122

45,439

39,594

Investing Activities
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from sale of assets and businesses . . . . . . . . . . . . . . . . . .
Cash used for businesses and intangible assets acquired . . . . . . . . . .

(62,368)
5,698
(68,527)

(59,191)
1,123
(140,332)

(27,991)
114
(15,351)

Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . .

(125,197)

(198,400)

(43,228)

Financing Activities
Net increase in revolving credit facility . . . . . . . . . . . . . . . . . . . . . .
Proceeds from issuance of long-term debt . . . . . . . . . . . . . . . . . . . .
Retirement of long-term debt
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repayment of debt and capital lease obligations . . . . . . . . . . . . . . .
Payment of deferred financing cost . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from exercise of stock options, including excess tax benefit
of $1,737 and $1,941 in 2008 and 2007 . . . . . . . . . . . . . . . . . . . .

68,975
92,950
161
202,088
— (124,424)
(114)
(6,252)
(1,961)
—

(5,775)
(72)
(2,661)
(12,342)

7,507

15,984

Net cash provided by financing activities . . . . . . . . . . . . . . . . . . . . .

79,768

154,296

Effect of exchange rate changes on cash . . . . . . . . . . . . . . . . . . . . .

Net change in cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

802

6,495
7,243

265

1,600
5,643

5,575
4,888
(2,320)
(4,508)
(1,317)
—
—

2,314

4,632

(135)

863
4,780

Cash at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 13,738

7,243

$ 5,643

See notes to consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share data)

1. BASIS OF PRESENTATION

Triumph Group, Inc. (‘‘Triumph’’) is a Delaware corporation which, through its operating
subsidiaries, designs, engineers, manufactures and sells products for the global aerospace original
equipment manufacturers (‘‘OEMs’’) of aircraft and aircraft components and repairs and overhauls
aircraft components and accessories for commercial airline, air cargo carrier and military customers on
a worldwide basis. Triumph and its subsidiaries (collectively, the ‘‘Company’’) is organized based on the
products and services that it provides. Under this organizational structure, the Company has two
reportable segments: the Aerospace Systems Group and the Aftermarket Services Group.

The Aerospace Systems segment consists of the Company’s operations which manufacture products

primarily for the aerospace OEM market. The segment’s operations design and engineer mechanical
and electromechanical controls, such as hydraulic systems and components, main engine
gearbox assemblies, accumulators and mechanical control cables. The segment’s revenues are also
derived from stretch forming, die forming, milling, bonding, machining, welding and assembly and
fabrication of various structural components used in aircraft wings, fuselages and other significant
assemblies. Further, the segment’s operations also design and manufacture composite assemblies for
floor panels, environmental control system ducts and non-structural cockpit components. These
products are sold to various aerospace OEMs on a global basis.

The Aftermarket Services segment consists of the Company’s operations that provide maintenance,

repair and overhaul services to both commercial and military markets on components and accessories
manufactured by third parties. Maintenance, repair and overhaul revenues are derived from services on
auxiliary power units, air frame and engine accessories, including constant-speed drives, cabin
compressors, starters and generators, and pneumatic drive units. In addition, the segment’s operations
repair and overhaul thrust reversers, nacelle components and flight control surfaces. The segment’s
operations also perform repair and overhaul services, and supply spare parts, for various types of
cockpit instruments and gauges for a broad range of commercial airlines on a worldwide basis.

Repair services generally involve the replacement of parts and/or the remanufacture of parts, which

is similar to the original manufacture of the part. The processes that the Company performs related to
repair and overhaul services are essentially the repair of wear parts or replacement of parts that are
beyond economic repair. The repair service generally involves remanufacturing a complete part or a
component of a part.

The accompanying consolidated financial statements include the accounts of Triumph and its
subsidiaries. Intercompany accounts and transactions have been eliminated from the consolidated
financial statements.

The preparation of financial statements in conformity with accounting principles generally accepted

in the United States requires management to make estimates and assumptions that affect the amounts
reported in the financial statements and accompanying notes. Actual results could differ from those
estimates.

Certain reclassifications have been made to prior year amounts in order to conform to the current

year presentation.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Concentration of Credit Risk

Accounts receivable are recorded net of an allowance for doubtful accounts. The Company
performs ongoing credit evaluations of its customers and generally does not require collateral. The
Company records the allowance for doubtful accounts based on prior experience and for specific
collectibility matters when they arise. The Company writes off balances against the reserve when
collectibility is deemed remote.

The Company’s trade accounts receivable are exposed to credit risk; however, the risk is limited

due to the diversity of the customer base and the customer base’s wide geographical area. Trade
accounts receivable from The Boeing Company (‘‘Boeing’’) represented approximately 17% and 16% of
total accounts receivable as of March 31, 2008 and 2007, respectively. The Company had no other
significant concentrations of credit risk. Sales to Boeing for fiscal 2008 were $259,516, or 23% of net
sales, of which $215,018 and $44,498 were from the Aerospace Systems segment and the Aftermarket
Services segment, respectively. Sales to Boeing for fiscal 2007 were $205,440 or 22% of net sales, of
which $172,829 and $32,611 were from the Aerospace Systems segment and the Aftermarket Services
segment, respectively. Sales to Boeing for fiscal 2006 were $164,992, or 22% of net sales, of which
$137,120 and $27,872 were from the Aerospace Systems segment and the Aftermarket Services
segment, respectively. No other single customer accounted for more than 10% of the Company’s net
sales; however, the loss of any significant customer, including Boeing, could have a material adverse
effect on the Company and its operating subsidiaries.

Inventories

Inventories are stated at the lower of cost or market using the average cost or specific

Property and Equipment

Property and equipment, which includes equipment under capital lease and leasehold

improvements, are recorded at cost and depreciated over the estimated useful lives of the related
assets, or the initial lease term if shorter in the case of leasehold improvements, by the straight-line
method. Buildings and improvements are depreciated over a period of 15 to 391⁄2 years, and machinery
and equipment are depreciated over a period of 7 to 15 years (except for furniture, fixtures and
computer equipment which are depreciated over a period of 3 to 10 years).

Goodwill and Intangible Assets

The Company accounts for purchased goodwill and intangible assets in accordance with Statement

of Financial Accounting Standards (‘‘SFAS’’) No. 142, Goodwill and Other Intangible Assets (‘‘SFAS
No. 142’’). Under SFAS No. 142, purchased goodwill and intangible assets with indefinite lives are not
amortized; rather, they are tested for impairment on at least an annual basis. Intangible assets with
finite lives are amortized over their useful lives.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

The Company’s operating segments of Aerospace Systems and Aftermarket Services are also the

In order to test goodwill and intangible assets with indefinite lives under SFAS No. 142, a
determination of the fair value of the Company’s reporting units and intangible assets with indefinite
lives is required and is based, among other things, on estimates of future operating performance of the
reporting unit and/or the component of the entity being valued. The Company is required to complete
an impairment test for goodwill and intangible assets with indefinite lives and record any resulting
impairment losses at least on an annual basis. The Company uses an income approach to determine the
fair value of its reporting units and intangible assets with indefinite lives. Changes in market conditions,
among other factors, may have an impact on these fair values. The Company completed its required
annual impairment tests in the fourth quarters of fiscal 2008, 2007 and 2006 and determined that there
was no impairment.

Revenue Recognition

Revenues are recognized in accordance with the contract terms when products are shipped,

delivery has occurred or services have been rendered, pricing is fixed or determinable, and collection is
reasonably assured. The Aftermarket Services Segment provides repair and overhaul services, certain of
which services are provided under long term power-by-the-hour contracts. The Company applies the
proportional performance method to recognize revenue under these contracts. Revenue is recognized
over the contract period as units are delivered based on the relative fair value in proportion to the
total estimated contract consideration. Reserves for contract losses are accrued when estimated costs to
complete exceed expected future revenues. The Company’s policy with respect to sales returns and
allowances generally provides that the customer may not return products or be given allowances, except
at the Company’s option. Accruals for sales returns, other allowances, and estimated warranty costs are
provided at the time of shipment based upon past experience.

Shipping and Handling Costs

The cost of shipping and handling products is included in cost of products sold.

Research and Development Expense

Research and development expense was approximately $9,883, $8,767 and $7,988 for the fiscal

years ended March 31, 2008, 2007 and 2006, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Foreign Currency Translation

The determination of the functional currency for Triumph’s foreign subsidiaries is made based on

appropriate economic factors. The functional currency of the Company’s subsidiaries in the United
Kingdom and Thailand is the U.S. dollar since that is the currency in which those entities primarily
generate and expend cash. The financial statements of the Company’s French subsidiaries are measured
using the local currency as the functional currency. Assets and liabilities of these subsidiaries are
translated at the rates of exchange at the balance sheet date. Income and expense items are translated
at average monthly rates of exchange. The resultant translation adjustments are included in
accumulated other comprehensive income. At March 31, 2008 and 2007, accumulated comprehensive
income resulting from foreign currency translation was $5,111 and $2,380, respectively. Gains and losses
arising from foreign currency transactions of these subsidiaries are included in net earnings.

Income Taxes

In accordance with the provisions of SFAS No. 109, Accounting for Income Taxes, the Company
accounts for income taxes using the asset and liability method. The asset and liability method requires
recognition of deferred tax assets and liabilities for expected future tax consequences of temporary
differences that currently exist between tax bases and financial reporting bases of the Company’s assets
and liabilities.

Recently Issued Accounting Pronouncements

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

statement applies to all entities and all derivative instruments. SFAS 161 is effective for financial
statements issued for fiscal years and interim periods beginning after November 15, 2008.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations (‘‘SFAS 141(R)’’)

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (‘‘SFAS 157’’).

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

adoption of SFAS 157 is ongoing; however, the Company does not expect the impact of SFAS 157 on
the Company’s financial condition and results of operations to be material.

In June 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes,

an interpretation of SFAS No. 109 (‘‘FIN 48’’). FIN 48 creates a single model to address accounting for
uncertainty in tax positions by prescribing a minimum recognition threshold a tax position is required to
meet before being recognized in the financial statements. FIN 48 also provides guidance on
derecognition, measurement, classification, interest and penalties, accounting in interim periods,
disclosure and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006. In
connection with its adoption of FIN 48 on April 1, 2007, the Company recognized a charge of
approximately $291 to retained earnings. See Note 6 of ‘‘Notes to Consolidated Financial Statements’’
for additional information regarding the Company’s uncertain tax positions.

Stock-Based Compensation

In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment, which requires

3. ACQUISITIONS

FISCAL 2008 ACQUISITIONS

Acquisition of B. & R. Machine & Tool Corp.

Effective February 27, 2008, the Company acquired the assets and business of B. & R. Machine &

Tool Corp. (‘‘B & R’’) through a newly organized, wholly-owned subsidiary of the Company, Triumph
Structures—Long Island, LLC. Triumph Structures—Long Island, LLC provides aircraft structural
components and dynamic parts and assemblies for commercial and military aerospace programs. The

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

3. ACQUISITIONS (Continued)

results for Triumph Structures—Long Island, LLC are included in the Company’s Aerospace Systems
segment.

The purchase price for B & R of $84,044 includes cash paid at closing, estimated deferred

payments and direct costs of the transaction. Included in the estimated deferred payments is an earnout
note for $13,000. Payments under the earnout note are contingent upon the achievement of certain
earnings levels during the earnout period. The maximum amounts payable in respect of fiscal 2009,
2010 and 2011, respectively, are $3,500, $4,500 and $5,000, respectively. The excess of the purchase
price over the preliminary estimated fair value of the net assets acquired of $35,512 was recorded as
goodwill, all of which is tax deductible. The Company has also identified intangible assets valued at
approximately $20,000 with a weighted-average life of 10 years. The Company is awaiting final
valuation of inventory and final appraisals of tangible and intangible assets related to its acquisition of
B & R. Accordingly, the Company has recorded its best estimate of the value of inventory, intangible
assets and property and equipment. Therefore, the allocation of purchase price for the acquisition of
B & R is not complete and is subject to change.

FISCAL 2007 ACQUISITIONS

Acquisition of Excel Manufacturing, Inc.

Effective April 1, 2006, the Company acquired the assets and business of Excel Manufacturing, Inc.

(‘‘Excel’’) through a newly organized, wholly-owned subsidiary of the Company, Triumph Structures—
Wichita, Inc. The results for Triumph Structures—Wichita, Inc. are included in the Company’s
Aerospace Systems segment. The purchase accounting for the acquisition of Excel was finalized during
fiscal 2007.

Acquisition of Air Excellence International, Inc.

Effective April 1, 2006, the Company acquired the assets and business of Air Excellence
International, Inc. and its affiliates (‘‘Air Excellence’’) through two newly organized, wholly-owned
subsidiaries of the Company, Triumph Interiors, LLC and Triumph Interiors Limited. The results for
Triumph Interiors, LLC and Triumph Interiors Limited are included in the Company’s Aftermarket
Services segment. The purchase accounting for the acquisition of Air Excellence was finalized during
fiscal 2007.

Acquisition of Allied Aerospace Industries, Inc.

Effective November 1, 2006, the Company acquired Allied Aerospace Industries, Inc. (‘‘Allied’’)

through the merger of a newly organized, wholly-owned subsidiary of the Company, with and into
Allied. The acquired business has since been consolidated into a single subsidiary of the Company,
Triumph Aerospace Systems—Newport News, Inc. Triumph Aerospace Systems—Newport News, Inc.
specializes in engineering design and manufacturing solutions for complex aerospace and defense
programs. The results for Triumph Aerospace Systems—Newport News, Inc. are included in the
Company’s Aerospace Systems segment.

During the first half of fiscal 2008, the Company finalized the purchase price allocation for the
Allied acquisition as a result of receiving the final appraisal of tangible and intangible assets, finalizing
the deferred tax accounting and recording the final purchase price adjustment as per the purchase

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

3. ACQUISITIONS (Continued)

agreement. Based on the revised allocation, an additional $100 was allocated to intangible assets while
the amount allocated to tangible assets was reduced by $232. The purchase price was reduced by $1,055
related to the final negotiation of the values on the closing balance sheet.

Acquisition of Grand Prairie Accessory Services, LLC

Effective January 1, 2007, the Company acquired the assets and business of Grand Prairie

Accessory Services, LLC (‘‘Grand Prairie’’) through a newly organized, wholly-owned subsidiary of the
Company, Triumph Accessory Services—Grand Prairie, Inc. Triumph Accessory Services—Grand
Prairie, Inc. provides comprehensive maintenance solutions for engine accessories related to the CF34,
CFM56, CF6, CT7 and V2500 family of engines. Capabilities include fuel, oil, pneumatic, hydraulic and
mechanical engine accessories for those and other aero and aero-derivative gas turbine engines. The
results for Triumph Accessory Services—Grand Prairie are included in the Company’s Aftermarket
Services segment.

During the third quarter of fiscal 2008, the Company finalized the purchase price allocation for the

Grand Prairie acquisition as a result of receiving the final appraisal of tangible and intangible assets
and finalizing the deferred tax accounting. Based on the revised allocation, an additional $1,532 was
allocated to tangible assets; intangible assets and goodwill were reduced by $1,215 and $561,
respectively; a deferred tax asset of $169 was established, and other liabilities were reduced by $75.

The following condensed balance sheet represents the amounts assigned to each major asset and

liability caption in the aggregate for the B & R acquisition:

Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaids and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property and equipment
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 4,468
10,000
34
295
10,000
44,488
20,000

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$89,285

Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other long-term liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 3,019
2,972
786
2,508

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 9,285

The B & R acquisition has been accounted for under the purchase method and, accordingly, is
included in the consolidated financial statements from the effective date of acquisition. The acquisition
was funded by the Company’s long-term borrowings in place at the date of acquisition.

The following unaudited pro forma information for the fiscal years ended March 31, 2008 and
2007 have been prepared assuming the B & R acquisition and the 2007 Acquisitions had occurred on
April 1, 2006. The pro forma information for the fiscal year ended March 31, 2008 is as follows: Net
sales: $1,192,080; Income from continuing operations: $78,988; Income per share from continuing

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

3. ACQUISITIONS (Continued)

operations—basic: $4.79; Income per share from continuing operations—diluted: $4.50. The pro forma
information for the fiscal year ended March 31, 2007 is as follows: Net sales: $1,012,840; Income from
continuing operations: $51,008; Income per share from continuing operations—basic: $3.14; and Income
per share from continuing operations—diluted: $3.11.

The unaudited pro forma information includes adjustments for interest expense that would have
been incurred to finance the purchase, additional depreciation based on the estimated fair market value
of the property and equipment acquired, and the amortization of the intangible assets arising from the
transactions. The unaudited pro forma financial information is not necessarily indicative of the results
of operations as it would have been had the transaction been effected on the assumed date.

4. DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE

In September 2007, the Company sold the assets of Triumph Precision, Inc., a build-to-specification

manufacturer and supplier of ultra-precision machined components and assemblies in its Aerospace
Systems segment. The effective date of the sale was July 1, 2007. The Company recognized a pre-tax
loss of $650 on the sale of the business, which included costs to sell of $150. The Company has also
decided to sell Triumph Precision Castings Co., a casting facility in its Aftermarket Services segment
that specializes in producing high quality hot gas path components for aero and land based gas
turbines. The Company recognized a pre-tax loss of $3,500 in the first quarter of fiscal 2008 based
upon a write-down of the carrying value of the business to estimated fair value less costs to sell. The
write-down was applied to inventory and long-lived assets, consisting primarily of property, plant and
equipment. For financial statement purposes, the assets, liabilities, results of operations and cash flows
of these businesses have been segregated from those of the continuing operations and are presented in
the Company’s consolidated financial statements as discontinued operations and assets and liabilities
held for sale.

Revenues of discontinued operations were $10,913, $17,408 and $11,053 for the fiscal years ended

March 31, 2008, March 31, 2007, and March 31, 2006, respectively. The loss from discontinued
operations was $8,468, $3,905 and $4,744, net of income tax benefit of $4,560, $2,103 and $2,556 for the
fiscal years ended March 31, 2008, March 31, 2007, and March 31, 2006, respectively. Interest expense
of $2,835, $2,762, and $2,215 was allocated to discontinued operations for the fiscal years ended
March 31, 2008, March 31, 2007, and March 31, 2006, respectively, based upon the actual borrowings of
the operations, and such interest expense is included in the loss from discontinued operations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

4. DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE (Continued)

Assets and liabilities held for sale are comprised of the following:

March 31, March 31,

2008

2007

Assets held for sale:

Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 7,689
11,272
5,711
91

$ 6,154
11,585
10,798
106

Total assets held for sale . . . . . . . . . . . . . . . . . . . . . . . . .

$24,763

$28,643

Liabilities held for sale:

Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax liabilities and other . . . . . . . . . . . . . . . . . . . . .

$ 1,378
1,253
1,956

$ 1,832
2,610
3,103

Total liabilities held for sale . . . . . . . . . . . . . . . . . . . . . . .

$ 4,587

$ 7,545

5. INVENTORIES

Inventories are stated at the lower of cost (average cost or specific identification methods) or

market. The components of inventories are as follows:

Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Manufactured and purchased components . . . . . . . . . . . . . . .
Work-in-process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 31,937
133,343
117,061
79,326

$ 30,357
100,512
99,660
65,551

Total inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$361,667

$296,080

March 31,

2008

2007

6. INCOME TAXES

The components of income tax expense are as follows:

Current:

Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$25,870
1,530

$18,582
1,338

$11,004
977

Year ended March 31,

2008

2007

2006

Deferred:

Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

27,400

19,920

11,981

9,498
263

9,761

5,688
521

6,209

1,315
(1,688)

(373)

$37,161

$26,129

$11,608

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

6. INCOME TAXES (Continued)

Income tax expense for the Company’s foreign operations, which is included in the above amounts,

for fiscal years 2008, 2007 and 2006 was $855, $1,289 and $487, respectively.

A reconciliation of the statutory federal income tax rate to the effective tax rate is as follows:

Statutory federal income tax rate . . . . . . . . . . . . . . . . . . . . . . . .
State and local income taxes, net of federal tax benefit . . . . . . . .
Miscellaneous permanent items and nondeductible accruals . . . .
Research and development tax credit . . . . . . . . . . . . . . . . . . . . .
ETI exclusion/domestic production tax benefits . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Year ended
March 31,

2008

2007

2006

35.0% 35.0% 35.0%
1.5
1.3
0.1
0.2
(2.0)
(1.8)
(2.3)
(1.3)
1.6
(0.5)

1.5
0.2
(1.8)
(3.5)
(8.6)

Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

32.9% 33.9% 22.8%

The components of deferred tax assets and liabilities are as follows:

March 31,

2008

2007

Deferred tax assets:

Net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accruals and reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 4,539
1,989
7,737
1,739

16,004
(1,374)

Net deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14,630

$ 3,380
1,626
8,363
1,687

15,056
—

15,056

Deferred tax liabilities:

Property and equipment
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill and other intangible assets . . . . . . . . . . . . . . . . . . .
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . . . . .

39,927
45,278
6,684
6,094

97,983

38,865
41,351
5,944
2,766

88,926

Net deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$83,353

$73,870

As of March 31, 2008, the Company has federal and state net operating loss carryforwards expiring

in various years through 2025.

Net income taxes paid during the fiscal years ended March 31, 2008, 2007 and 2006 were $21,740,

$19,351 and $6,979, respectively. The Company also has a foreign net operating loss carryforward for
which a valuation allowance has been established.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

6. INCOME TAXES (Continued)

Effective April 1, 2007, the Company adopted FIN 48, Accounting for Uncertainty in Income Taxes.

The cumulative effect of adoption of FIN 48 has been recorded as a charge of $291 to retained
earnings, an increase of $66 to net deferred income tax liabilities and an increase of $225 to income
taxes payable as of April 1, 2007.

In conjunction with the adoption of FIN 48, the Company has classified uncertain tax positions as

non-current income tax liabilities unless expected to be paid in one year. Penalties and tax-related
interest expense are reported as a component of income tax expense. As of March 31, 2008 and upon
adoption of FIN 48 on April 1, 2007, the total amount of accrued income tax-related interest and
penalties was $433 and $254, respectively.

As of March 31, 2008, and April 1, 2007, the total amount of unrecognized tax benefits was $2,950

and $2,534, respectively, of which $2,698 and $2,181, respectively, would impact the effective rate, if
recognized. The Company anticipates that total unrecognized tax benefits may be reduced by $1,140
due to the expiration of statutes of limitation for various federal tax issues in the next 12 months.

As of March 31, 2008, the Company was subject to examination in state jurisdictions for the fiscal
years ended March 31, 2004 through March 31, 2006, none of which we believe is individually material.
The Company has filed appeals in a state jurisdiction related to fiscal years ended March 31, 1999
through March 31, 2003. The Company believes appropriate provisions for all outstanding issues have
been made for all jurisdictions and all open years.

With few exceptions, the Company is no longer subject to U.S. federal income tax examinations for

fiscal years ended before March 31, 2005, state or local examinations for fiscal years ended before
March 31, 2004, or foreign income tax examinations by tax authorities for fiscal years ended before
March 31, 2006.

From the FIN 48 adoption date of April 1, 2007 and during the fiscal year ended March 31, 2008,

the Company added $517 of tax, interest and penalties related to activity for identified uncertain tax
positions.

A reconciliation of the liability for uncertain tax positions for the year ended March 31, 2008

follows:

Opening Balance—April 1, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Additions for tax positions related to the current year . . . . . . . . . . . .
Additions for tax positions of prior years . . . . . . . . . . . . . . . . . . . . . .
Reductions for tax positions of prior years . . . . . . . . . . . . . . . . . . . . .
Reductions as a result of a lapse of statute of limitations . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Ending Balance—March 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . .

$2,279
329
87
(178)
—
—

$2,517

March 31, 2008

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

7. LONG-TERM DEBT

Long-term debt consists of the following:

Convertible senior subordinated notes . . . . . . . . . . . . . . . . . .
Revolving credit facility . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subordinated promissory notes . . . . . . . . . . . . . . . . . . . . . . .
Other debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Less current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

March 31,

2008

2007

$201,250
193,750
13,000
11,813

419,813
1,010

$201,250
100,800
5,500
8,633

316,183
5,702

$418,803

$310,481

Credit Facility

On October 20, 2006, the Company amended the Credit Facility with its lenders to increase the
Credit Facility to $350,000 from $250,000, extend the maturity date to June 30, 2011 and amend certain
other terms and covenants. The Credit Facility bears interest at either: (i) LIBOR plus between 0.625%
and 2.00%; (ii) the prime rate; or (iii) an overnight rate at the option of the Company. The applicable
interest rate is based upon the Company’s ratio of total indebtedness to earnings before interest, taxes,
depreciation and amortization. In addition, the Company is required to pay a commitment fee of
between 0.175% and 0.400% on the unused portion of the Credit Facility.

On December 22, 2006, the Company amended the Credit Facility with its lenders primarily to

eliminate a financial covenant restricting aggregate capital expenditures to 200% of consolidated
depreciation expense in any fiscal year. The Company’s obligations under the Credit Facility are
guaranteed by the Company’s subsidiaries.

At March 31, 2008, there were $193,750 in borrowings and $5,941 in letters of credit outstanding
under the facility. At March 31, 2007 there were $100,800 in borrowings and $6,309 in letters of credit
outstanding under the facility. The level of unused borrowing capacity under the Company’s revolving
credit facility varies from time to time depending in part upon its compliance with financial and other
covenants set forth in the related agreement. The Company is currently in compliance with all such
covenants. As of March 31, 2008, the Company had borrowing capacity under this facility of $150,309
after reductions for borrowings and letters of credit outstanding under the facility.

Interest Rate Swap

The Company uses interest rate swaps, a type of derivative financial instrument, to manage interest

costs and minimize the effects of interest rate fluctuations on cash flows associated with its Credit
Facility. The Company does not use derivatives for trading or speculative purposes. While interest rate
swaps are subject to fluctuations in value, these fluctuations are generally offset by the value of the
underlying exposures being hedged. The Company minimizes the risk of credit loss by entering into
these agreements with major financial institutions that have high credit ratings. The Company accounts
for its interest rate swaps in accordance with SFAS No. 133, Accounting for Derivative Instruments and
Hedging Activities, (‘‘SFAS 133’’), which requires that all derivatives be recorded on the balance sheet at
fair value. SFAS 133 also requires that changes in the fair value be recorded each period in current

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

7. LONG-TERM DEBT (Continued)

earnings or other comprehensive income, depending on whether a derivative has been designated as
part of a hedge transaction and, if it is, depending on the type of hedge transaction. Interest rate swaps
are designated as cash flow hedges. Changes in the fair value of a cash flow hedge, to the extent the
hedge is effective, are recorded, net of tax, in other comprehensive income (loss), a component of
stockholders’ equity, until earnings are affected by the variability of the hedged cash flows. Cash flow
hedge ineffectiveness, defined as the extent that the changes in the fair value of the derivative exceed
the variability of cash flows of the forecasted transaction, is recorded currently in earnings.

In March 2008, the Company entered into an $85,000 floating to fixed interest rate swap
agreement (the ‘‘Swap’’), maturing June 2011. Under the Swap, the Company receives interest
equivalent to the one-month LIBOR and pays a fixed rate of interest of 2.925 percent with settlements
occurring monthly. The objective of the hedge is to eliminate the variability of cash flows in interest
payments for $85,000 of floating rate debt under the Credit Facility. To maintain hedge accounting for
the Swap, the Company is committed to maintaining at least $85,000 in borrowings on the revolver at
an interest rate based on one-month LIBOR, plus an applicable margin, through June 2011. The
Swap’s fair value of $531 is included in deferred income taxes and other on the consolidated balance
sheet and the corresponding change in fair value is included in other comprehensive income, a
component of stockholders’ equity. The Company estimates that $574 of losses presently in
accumulated other comprehensive income will be reclassified into earnings during fiscal year 2009.

Convertible Senior Subordinated Notes

On September 18, 2006, the Company issued $201,250 in convertible senior subordinated

notes (the ‘‘Notes’’). The Notes are direct, unsecured, senior subordinated obligations of the Company,
and rank (i) junior in right of payment to all of the Company’s existing and future senior indebtedness,
(ii) equal in right of payment with any other future senior subordinated indebtedness, and (iii) senior in
right of payment to all subordinated indebtedness.

The Company received net proceeds from the sale of the Notes of approximately $194,998 after
deducting offering expenses of approximately $6,252. The use of the net proceeds from the sale was for
prepayment of the Company’s outstanding senior notes, including a make-whole premium, fees and
expenses in connection with the prepayment, and to repay a portion of the outstanding indebtedness
under the Company’s Credit Facility. Approximately $6,252 in debt issuance costs have been recorded
as other assets in the accompanying consolidated balance sheets. Debt issuance costs are being
amortized over a period of five years.

The Notes bear interest at a fixed rate of 2.625% per annum, payable in cash semi-annually in
arrears on each April 1 and October 1 beginning April 1, 2007. During the period commencing on
October 6, 2011 and ending on, but excluding, April 1, 2012 and each six-month period from October 1
to March 31 or from April 1 to September 30 thereafter, the Company will pay contingent interest
during the applicable interest period if the average trading price of a Note for the five consecutive
trading days ending on the third trading day immediately preceding the first day of the relevant
six-month period equals or exceeds 120% of the principal amount of the Notes. The contingent interest
payable per Note in respect of any six-month period will equal 0.25% per annum calculated on the
average trading price of a Note for the relevant five trading day period. This contingent interest feature
represents an embedded derivative. Since it is in the control of the Company to call the Notes at any

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

7. LONG-TERM DEBT (Continued)

time after October 6, 2011, the value of the derivative was determined to be de minimis. Accordingly,
no value has been assigned at issuance or at March 31, 2008.

The Notes are eligible for conversion upon meeting certain conditions as provided in the indenture
governing the Notes. For the periods from October 1, 2007 through December 31, 2007 and January 1,
2008 through March 31, 2008, the Notes were eligible for conversion; however, during this period, none
of the Notes was converted. The Company has classified the Notes as long-term as of March 31, 2008.

To be included in the calculation of diluted earnings per share, the average price of the Company’s

common stock for the fiscal year must exceed the conversion price per share of $54.45. The average
price of the Company’s common stock for the fiscal year ended March 31, 2008 was $68.95, therefore,
777,059 additional shares were included in the diluted earnings per share calculation. No additional
shares were included in the diluted earnings per share calculation for the fiscal year ended March 31,
2007 since the average price of the Company’s stock did not exceed the conversion price.

Prepayment of Senior Notes

On October 4, 2006, the Company prepaid all of its outstanding Class A Senior Notes and Class B
Senior Notes (collectively, the ‘‘Senior Notes’’) and, accordingly, the rights of the holders of the Senior
Notes under the Note Purchase Agreement, dated November 21, 2002, between the Company and such
holders, as amended, ceased. The Senior Notes were prepaid with the proceeds from the Company’s
sale of the Notes as discussed above. Immediately prior to prepayment, $68,375 aggregate principal
amount of Class A Senior Notes, which carried a fixed rate of interest of 6.06%, were outstanding, and
$56,049 aggregate amount of Class B Senior Notes, which carried a fixed rate of interest of 5.59%,
were outstanding. If the Company had not prepaid the outstanding Senior Notes, they would have
matured on December 2, 2012, subject to a requirement under the Note Purchase Agreement that the

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

7. LONG-TERM DEBT (Continued)

Company annually prepay $8,007 of the outstanding Class B Senior Notes starting on December 2,
2006. The Senior Notes were senior unsecured obligations of the Company and ranked junior in right
of payment to the rights of the Company’s secured creditors to the extent of their security in the
Company’s assets, equal in right of payment to the rights of creditors under the Company’s other
existing and future unsecured unsubordinated obligations, senior in right of payment to the rights of
creditors under obligations expressly subordinated to the Senior Notes, and effectively subordinated to
secured and unsecured creditors of the Company’s subsidiaries. The prepayment was made upon proper
notice to the holders of the Senior Notes at a price equal to 100% of the principal amount of the
outstanding Senior Notes being prepaid, plus accrued and unpaid interest of approximately $2,466, plus
a ‘‘make whole’’ premium of approximately $4,395 based on the value of the remaining scheduled
interest payments on the Senior Notes being prepaid. The Company expensed the ‘‘make whole’’
premium of $4,395 as well as unamortized debt issuance costs related to the Senior Notes of $693 in
the third quarter of fiscal 2007.

The indentures under the debt agreements and the Credit Facility described above contain
restrictions and covenants which include limitations on the Company’s ability to incur additional
indebtedness, issue stock options or warrants, make certain restricted payments and acquisitions, create
liens, enter into transactions with affiliates, sell substantial portions of its assets and pay cash dividends.
Additional covenants require compliance with financial tests, including leverage and interest coverage
ratio.

The Company’s long-term debt portfolio consists of fixed-rate and variable-rate instruments and is
managed to reduce the overall cost of borrowing and to mitigate fluctuations in interest rates. Interest
rate fluctuations result in changes in the market value of the Company’s fixed-rate debt. The fair values
of the Company’s Notes are determined using discounted cash flows based upon the Company’s
estimated current cost for similar types of borrowings or current market value. The fair value of the
Notes was $247,874 and $238,218 as of March 31, 2008 and March 31, 2007, respectively. The carrying
value of other long-term debt and notes payable approximate their fair market values as of March 31,
2008 and March 31, 2007, respectively.

As of March 31, 2008, the maturities of long-term debt are as follows: 2009—$1,010; 2010—$4,461;

2011—$206,649; 2012—$199,559; 2013—$490; thereafter, $7,644 through 2026.

Interest paid on indebtedness during the years ended March 31, 2008, 2007, and 2006 amounted to

$14,512, $16,880 and $11,379, respectively.

8. STOCKHOLDERS’ EQUITY

During February 2008, the Company exercised existing authority to make stock repurchases and
repurchased 220,000 shares of its outstanding shares under the program for an aggregate consideration
of $12,342, funded by borrowings under the Company’s Credit Facility. In February 2008, the
Company’s Board of Directors then authorized an increase in the Company’s existing stock repurchase
program by up to an additional 500,000 shares of its common stock. As a result, as of May 15, 2008,
the Company remains able to purchase an additional 500,800 shares. Repurchases may be made from
time to time in open market transactions, block purchases, privately negotiated transactions or
otherwise at prevailing prices. No time limit has been set for completion of the program.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

8. STOCKHOLDERS’ EQUITY (Continued)

During fiscal 2007, the Company filed a registration statement with the SEC to register shares of

Common Stock issuable by the Company upon conversion (the ‘‘Conversion Shares’’) of the Company’s
issued and outstanding Notes. The Company cannot determine the number of Conversion Shares it will
issue upon conversion of the Notes, if any. The Notes are further discussed in Note 7.

The holders of the Common stock and the Class D common stock are entitled to one vote per
share on all matters to be voted upon by the stockholders of Triumph except that Class D does not
participate in the voting of directors and is entitled to participate ratably in any distributions.

The Company has preferred stock of $.01 par value, 250,000 shares authorized. At March 31, 2008

and 2007, no shares of preferred stock were outstanding.

The Company has Class D common stock of $.001 par value, 6,000,000 shares authorized. At

March 31, 2008 and 2007, no shares of Class D common stock were outstanding.

9. EARNINGS PER SHARE

The following is a reconciliation between the weighted average common shares outstanding used in

the calculation of basic and diluted earnings per share:

Weighted average common shares outstanding—basic . . . .
Net effect of dilutive stock options . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . .
Net effect of convertible debt

16,497
266
777

(thousands)
16,220
193
—

15,920
140
—

Weighted average common shares outstanding—diluted . .

17,540

16,413

16,060

Year ended March 31,

2008

2007

2006

10. EMPLOYEE BENEFIT PLANS

Defined Contribution Pension Plan

The Company sponsors a defined contribution 401(k) plan, under which salaried and certain
hourly employees may defer a portion of their compensation. Eligible participants may contribute to
the plan up to the allowable amount as determined by the plan of their regular compensation before
taxes. The Company generally matches contributions at 50% of the first 6% of compensation
contributed by the participant. All contributions and Company matches are invested at the direction of
the employee in one or more mutual funds. Company matching contributions vest immediately and
aggregated $5,309, $4,006 and $3,619 for the fiscal years ended March 31, 2008, 2007 and 2006,
respectively.

Defined Benefit Pension Plans

The Company has several defined benefit pension plans covering eligible employees. U.S. plans

covering union employees generally provide benefit payments of stated amounts for each year of
service. The Company also sponsors an unfunded supplemental executive retirement plan (‘‘SERP’’)
that provides retirement benefits to certain key employees. The Company uses a December 31
measurement date for its union plans and March 31 for its SERP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

10. EMPLOYEE BENEFIT PLANS (Continued)

On March 31, 2007, the Company adopted the recognition and disclosure provisions of SFAS
No. 158. SFAS No. 158 required the Company to recognize the funded status (i.e., the difference
between the fair value of plan assets and the projected benefit obligations) of the Company’s pension
plans and SERP plan as of March 31, 2007 in its Consolidated Balance Sheet, with a corresponding
adjustment to accumulated other comprehensive income (loss), net of tax. The adjustment to
accumulated other comprehensive income (loss) at adoption represents the net unrecognized actuarial
gains/(losses), unrecognized prior service costs and unrecognized transition obligation remaining from
the initial adoption of SFAS No. 87, all of which were previously netted against the plan’s funded status
in the Company’s Consolidated Balance Sheet. These amounts will be subsequently recognized as net
periodic benefit cost. Further, actuarial gains and losses that arise in subsequent periods and are not
recognized as net periodic benefit cost in the same periods will be recognized as a component of
accumulated other comprehensive income (loss). Those amounts will be subsequently recognized as a
component of net periodic benefit cost on the same basis as the amounts recognized in accumulated
other comprehensive income (loss) at adoption of SFAS No. 158.

The effects of adopting the provisions of SFAS No. 158 at March 31, 2007 resulted in an increase

in total liabilities of $2,561 and a reduction of total stockholders’ equity of $1,613. The adoption of
SFAS No. 158 had no effect on the Company’s Consolidated Statement of Income for the fiscal year
ended March 31, 2007, or for any prior periods presently and will not affect the Company’s
Consolidated Statement of Income in future periods.

SFAS No. 158 also includes a requirement to measure plan assets and benefit obligations as of the

date of the Company’s fiscal year-end statement of financial position. The requirement is effective for
fiscal years ending after December 15, 2008, and shall not be applied retrospectively. The Company will
adopt the measurement provisions of SFAS No. 158 on March 31, 2009. Only the Company’s union
plans are affected by the measurement provisions of SFAS No. 158 since the union plans have a
December 31 measurement date. The net periodic benefit cost for the period between December 31,
2008 and March 31, 2009 shall be recognized, net of tax, as a separate adjustment of the opening
balance of retained earnings. The Company does not expect the impact of adopting the measurement
provisions of SFAS No. 158 on the Company’s financial condition and results of operations to be
material.

Included in accumulated other comprehensive income at March 31, 2008, are the following
amounts that have not yet been recognized in net periodic pension cost: unrecognized prior service
costs of $1,083 ($682 net of tax) and unrecognized actuarial losses of $1,815 ($1,144 net of tax). The
prior service cost and actuarial loss included in other comprehensive income and expected to be
recognized in net periodic pension cost during the fiscal year ended March 31, 2009 is $519 ($327 net
of tax) and $108 ($68 net of tax), respectively.

The following table sets forth the Company’s consolidated defined benefit pension plans for its
union employees as of December 31, 2007 and 2006 and its SERP as of March 31, 2008 and 2007, and
the amounts recorded in the Consolidated Balance Sheet at March 31, 2008 and 2007. Company
contributions include amounts contributed directly to plan assets and indirectly as benefits are paid

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

10. EMPLOYEE BENEFIT PLANS (Continued)

from the Company’s assets. Benefit payments reflect the total benefits paid from the plan and the
Company’s assets. Information on the plans includes both the qualified and non-qualified plans.

Change in Projected Benefit Obligations
Projected benefit obligation at beginning of year . . . . . . . . . . . .
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial loss/(gain) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in plan provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Curtailment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

March 31,

2008

2007

$12,562
91
608
319
—
(451)
(2,580)

$11,450
200
677
(15)
428
—
(178)

Projected benefit obligation at end of year . . . . . . . . . . . . . . . . .

$10,549

$12,562

Weighted-average Assumptions Used to Determine Benefit

Obligations at End of Year

Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate of compensation increase . . . . . . . . . . . . . . . . . . . . . . . . .
Change in Plan Assets
Fair value of plan assets at beginning of year . . . . . . . . . . . . . . .
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Company contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.25% 6.00%
N/A

N/A

$ 6,206
426
(155)
2,699
(2,580)

$ 5,217
704
(141)
604
(178)

Fair value of plan assets at end of year . . . . . . . . . . . . . . . . . . .

$ 6,596

$ 6,206

Funded Status (Underfunded)
Funded status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ (3,953) $ (6,356)

Amounts Recognized in the Balance Sheet Consist of:
Accrued expenses—current liability . . . . . . . . . . . . . . . . . . . . . .
Pension obligation—noncurrent liability . . . . . . . . . . . . . . . . . . .
Pension asset—current asset . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ (3,003) $ (2,292)
(4,064)
—

(1,102)
152

Net amount recognized . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ (3,953) $ (6,356)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

10. EMPLOYEE BENEFIT PLANS (Continued)

The components of net periodic pension cost for fiscal years 2008, 2007 and 2006 are as follows:

Year Ended March 31,

2008

2007

2006

Components of Net Periodic Pension Cost:
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . .
Amortization of prior service cost . . . . . . . . . . . . . . . . . . .
Amortization of net loss . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 171
608
(489)
518
104

$ 260
677
(433)
482
199

$ 234
616
(371)
465
179

Total net periodic pension cost

. . . . . . . . . . . . . . . . . . . . .

$ 912

$1,185

$1,123

Weighted-average Assumptions Used to Determine Net

Periodic Pension Cost:

Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected long-term rate on assets . . . . . . . . . . . . . . . . . . .
Rate of compensation increase . . . . . . . . . . . . . . . . . . . . . N/A

6.00% 5.75% 5.75%
8.00% 8.00% 8.00%
N/A

N/A

Expected Pension Benefit Payments

Benefit payments for pensions (including the SERP), which reflect expected future service, as

appropriate, are expected to be as follows:

Year

2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2014-2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Amount

$3,284
326
581
376
402
2,477

The table below sets forth the Company’s target asset allocation for fiscal 2009 and the actual asset

allocations at March 31, 2008 and 2007.

Asset Category

Actual Allocation

Target Allocation

March 31,

Fiscal 2009

2008

2007

Equity securities . . . . . . . . . . . . . . . . . . . . . . .
Fixed income securities . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

40-70%
25-40%
0-10%

Total

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

62%
37%
1%

66%
34%
0%

100% 100%

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

10. EMPLOYEE BENEFIT PLANS (Continued)

Investment Policy and Strategy

The policy, as established by the benefits committee (‘‘Committee’’), is to provide for growth of
capital with a moderate level of volatility by investing assets per the target allocations stated above. The
assets will be reallocated periodically, but in no event less than every six months, to meet the above
target allocations. The investment policy will be reviewed on a regular basis, in conjunction with an
investment advisor, to determine if the policy should be changed.

Determination of Expected Long-term Rate of Return

The expected long-term rate of return for the plan’s total assets is based on the expected return of

each of the above categories, weighted based on the median of the target allocation for each class.
Equity securities are expected to return 10% to 11% over the long-term, while cash and fixed income is
expected to return between 4% to 6%. Based on historical experience, the Committee expects that the
plans’ asset managers will provide a modest (0.5% to 1.0% per annum) premium to their respective
market benchmark indices.

Anticipated Contributions to Defined Benefit Plans

Assuming a normal retirement age of 65, the Company expects to contribute approximately $3,194

to its pension plans during fiscal 2009.

11. STOCK COMPENSATION PLANS

The Company has stock incentive plans under which employees and non-employee directors may

be granted options to purchase shares of the Company’s common stock at the fair value at the time of
the grant. Employee options and non-employee director options generally vest over three to four years
and expire ten years from the date of the grant. Compensation expense recognized for all option grants
is net of estimated forfeitures and is recognized over the awards’ respective requisite service periods.
There were no employee or non-employee director options granted during fiscal 2008 or 2007. The fair
values relating to prior option grants were estimated using a Black-Scholes option pricing model.
Expected volatilities are based on historical volatility of the Company’s stock and other factors, such as
implied market volatility. We used historical exercise data based on the age at grant of the option
holder to estimate the options’ expected term, which represents the period of time that the options
granted are expected to be outstanding. The Company anticipated the future option holding periods to
be similar to the historical option holding periods. The risk-free rate for periods within the contractual
life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company
recognizes compensation expense for the fair values of these awards on a straight-line basis over the
requisite service period of these awards.

In April 2005, the Compensation and Management Development Committee approved the
granting of restricted stock to several of its senior executives and employees, the number of shares of
which was to be determined based upon the Company’s financial performance during fiscal 2006. Also
on the same date, the Compensation and Management Development Committee granted to the same
group of executives and employees options to purchase 113,750 shares of the Company’s common stock
at an exercise price of $30.74 per share. In April 2006, 54,898 restricted shares were earned following
the determination of net earnings per share for fiscal 2006. The restricted shares are subject to

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

11. STOCK COMPENSATION PLANS (Continued)

forfeiture should the grantee’s employment be terminated prior to the fourth anniversary of the date of
grant, and are included in capital in excess of par value.

Restricted shares generally vest in full after four years. The fair value of restricted shares under
the Company’s restricted stock plans is determined by the product of the number of shares granted and
the grant date market price of the Company’s common stock. The fair value of restricted shares is
expensed on a straight-line basis over the requisite service period of four years.

The Company recorded $2,809 and $2,524 of share-based compensation expense during the fiscal
years ended March 31, 2008 and March 31, 2007, respectively. The total income tax benefit recognized
for share-based compensation arrangements for fiscal years ended March 31, 2008 and March 31, 2007
was $937 and $808, respectively. Total share-based compensation expense was comprised of stock
option expense of $453 and $595 and restricted stock expense of $2,356 and $1,929 for the fiscal years
ended March 31, 2008 and March 31, 2007, respectively. The Company estimates it will record share-
based compensation expense of approximately $3,300 in fiscal 2009. This estimate may be impacted by
potential changes to the structure of the Company’s share-based compensation plans which could
impact the number of stock options granted in fiscal 2009, changes in valuation assumptions, and
changes in the market price of the Company’s common stock, among other things and, as a result, the
actual share-based compensation expense in fiscal 2009 may differ from the Company’s current
estimate. The following table illustrates the impact of share-based compensation on reported amounts:

Fiscal Year ended
March 31, 2008

Fiscal Year ended
March 31, 2007

Operating income . . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . .

$126,325
$ 75,742

$2,809
$1,872

As
Reported

Impact of
Share-Based
Compensation

As
Reported

$93,899
$50,976

Impact of
Share-Based
Compensation

$2,524
$1,716

Earnings per share:

Income from continuing operations—

Basic . . . . . . . . . . . . . . . . . . . . . . . . . .

Income from continuing operations—

Diluted . . . . . . . . . . . . . . . . . . . . . . . .

4.59

$ 0.11

4.32

$ 0.11

3.14

$ 0.11

3.11

$ 0.10

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

11. STOCK COMPENSATION PLANS (Continued)

A summary of the Company’s stock option activity and related information for its option plans for

the fiscal year ended March 31, 2008 was as follows:

Outstanding at March 31, 2007 . . . . . . . . .
Granted . . . . . . . . . . . . . . . . . . . . . . . .
Exercised . . . . . . . . . . . . . . . . . . . . . . .
Forfeited . . . . . . . . . . . . . . . . . . . . . . .

Options

508,869
—
(170,943)
(3,044)

Outstanding at March 31, 2008 . . . . . . . . .

334,882

Exercisable at March 31, 2008 . . . . . . . . .

301,223

Weighted
Average
Exercise
Price

$35.91
—
$37.87
$30.74

$34.95

$35.42

Weighted
Average
Remaining
Contractual
Term

Aggregate
Intrinsic Value

4.5 years

4.2 years

$7,933

$6,994

At March 31, 2008 and 2007, 1,384,504 shares and 1,424,840 shares of common stock, respectively,

were available for issuance under the plans. A summary of the status of the Company’s nonvested
options as of March 31, 2008 and changes during the fiscal year ended March 31, 2008, is presented
below:

Nonvested at March 31, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Options

72,823
—
(36,120)
(3,044)

Nonvested at March 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

33,659

Weighted
Average Grant
Date Fair Value

$14.25
—
$14.25
$14.25

$14.25

Expected future compensation expense relating to the 33,659 nonvested options outstanding as of
March 31, 2008, net of expected forfeitures, is approximately $32, which is expected to be recognized
over a weighted-average period of .25 years.

There are 49,792 nonvested restricted shares outstanding from the 2006 grant of restricted stock
from the 2004 Stock Incentive Plan as of March 31, 2008. Expected future compensation expense on
these shares, net of expected forfeitures, is approximately $581, which is expected to be recognized over
the remaining vesting period of 1.0 years.

There are 90,399 nonvested restricted shares outstanding from the 2007 grant of restricted stock
from the 2004 stock Incentive Plan as of March 31, 2008. Expected future compensation expense on
those shares, net of expected forfeitures, is approximately $2,174, which is expected to be recognized
over the remaining vesting period of 2.0 years.

In June 2007, the Compensation and Management Development Committee of the Board of
Directors approved the granting of restricted stock to several of its senior executives and employees,
the number of shares of which was to be determined based upon the Company’s financial performance
during fiscal 2008. In April 2008, 40,902 restricted shares were earned following the determination of
net earnings per share for fiscal 2008. Expected future compensation expense on these shares, net of

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

11. STOCK COMPENSATION PLANS (Continued)

anticipated forfeitures is approximately $1,816, which is expected to be recognized over the remaining
vesting period of 3.0 years.

In July 2006, the Board of Directors approved the granting of deferred stock units to each of the

non-employee members of the Board of Directors under the Directors’ Plan. Concurrent with the
approval, in July 2006, 5,000 total deferred stock units were granted to the non-employee members of
the Board of Directors. In June 2007, an additional 2,500 deferred stock units were granted to the
non-employee members of the Board of Directors. Each deferred stock unit represents the contingent
right to receive one share of the Company’s common stock. The deferred stock units vest over a four
year period and the shares of common stock underlying vested deferred stock units will be delivered on
January 1 of the year following the year in which the non-employee director terminates service as a
Director of the Company.

Pro forma disclosure for 2006 regarding net income and earnings per share has been determined

as if the Company had accounted for its employee stock options under the fair value method. The fair
value of the Company’s stock options was estimated at the date of grant using a Black-Scholes option
pricing model with the following weighted-average assumptions: risk-free interest rate of 4.0%; no
dividends; a volatility factor of the expected market price of the Company’s common stock of .42, and a
weighted-average expected life of the options of 6 years.

For purposes of pro forma disclosures, the weighted average fair value of the options ($14.25) is
amortized to expense over the options’ assumed vesting period. The following pro forma information
has been prepared assuming the Company accounted for its stock options under the fair value method:

Pro Forma Income and Earnings Per Share from Continuing Operations

Income from continuing operations, as reported . . . . . . . . . . . . . . . . . . . . . . .
Stock-based employee compensation cost, net of related tax effects, included in
reported income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . .
Stock-based employee compensation cost, net of related tax effects, determined
under the fair value method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Year ended
March 31, 2006

$39,259

430

(3,590)

Pro forma income from continuing operations

. . . . . . . . . . . . . . . . . . . . . . . .

$36,099

Earnings per share—basic:

Income from continuing operations, as reported . . . . . . . . . . . . . . . . . . . . .
Pro forma income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .

Earnings per share—diluted

Income from continuing operations, as reported . . . . . . . . . . . . . . . . . . . . .
Pro forma income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .

$
$

2.47
2.27

2.45
2.25

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

12. ACCRUED EXPENSES

Accrued expenses are composed of the following items:

Accrued compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued payable relating to CFM56 Contract (see Note 15) . . . .
All other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$39,098
—
44,299

$31,628
2,860
41,094

Total accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$83,397

$75,582

March 31,

2008

2007

13. LEASES

At March 31, 2008, future minimum payments under noncancelable operating leases with initial or

remaining terms of more than one year were as follows: 2009—$18,333; 2010—$9,073; 2011—$8,539;
2012—$7,198; 2013—$5,567; thereafter, $21,440 through 2022. In the normal course of business,
operating leases may contain residual value guarantees and purchase options are generally renewed or
replaced by other leases.

At March 31, 2008, future minimum sublease rentals are as follows: 2009—$636; 2010—$654;

2011—$669; 2012—$685; 2013—$618; thereafter, $2,539 through 2018.

Total rental expense was $14,725, $13,151 and $12,007 for the fiscal years ended March 31, 2008,

2007 and 2006, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

14. PROPERTY AND EQUIPMENT

Net property and equipment at March 31, 2008 and 2007 is:

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Buildings and improvements . . . . . . . . . . . . . . . . . . . . . . . . .
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . .

Less accumulated depreciation . . . . . . . . . . . . . . . . . . . . . .

March 31,

2008

2007

$ 17,802
128,038
369,683

515,523
191,428

$ 18,075
124,655
300,845

443,575
159,894

$324,095

$283,681

Depreciation expense for the fiscal years ended March 31, 2008, 2007 and 2006 was $32,779,

$26,947 and $23,642, respectively, which includes depreciation of assets under capital lease.

15. GOODWILL AND OTHER INTANGIBLE ASSETS

The following is a summary of the changes in the carrying value of goodwill by reportable segment,

for the fiscal years ended March 31, 2008 and March 31, 2007:

Aerospace
Systems

Aftermarket
Services

Total

Fiscal 2008
Balance at beginning of year . . . . . . . . . . . . . . . .
Goodwill recognized in connection with

acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase price allocation adjustments . . . . . . . . . .
Effect of exchange rate changes and other . . . . . .

$285,797

$54,133

$339,930

44,488
(1,103)
993

—
(568)
—

44,488
(1,671)
993

Balance at end of year . . . . . . . . . . . . . . . . . . . .

$330,175

$53,565

$383,740

Fiscal 2007
Balance at beginning of year . . . . . . . . . . . . . . . .
Goodwill recognized in connection with

acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of exchange rate changes and other . . . . . .

$241,776

$30,961

$272,737

43,517
504

23,172
—

66,689
504

Balance at end of year . . . . . . . . . . . . . . . . . . . .

$285,797

$54,133

$339,930

Intangible assets, cost and accumulated amortization at March 31, 2008 were $129,920 and $51,432,
respectively. Intangible assets, cost and accumulated amortization at March 31, 2007 were $112,710 and
$42,791, respectively. Intangible assets consist of two major classes: (i) product rights and licenses,
which at March 31, 2008 had a weighted-average life of 11.3 years, and (ii) non-compete agreements,
customer relationships and other, which at March 31, 2008 had a weighted-average life of 10.4 years.
Gross cost and accumulated amortization of product rights and licenses at March 31, 2008 were $74,082
and $38,087 respectively, and at March 31, 2007 were $73,957 and $31,070, respectively. Gross cost and
accumulated amortization of noncompete agreements, customer relationships and other at March 31,
2008 were $55,838 and $13,345, respectively, and at March 31, 2007 were $38,753 and $11,721,

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

15. GOODWILL AND OTHER INTANGIBLE ASSETS (Continued)

respectively. Amortization expense for the fiscal years ended March 31, 2008, 2007, and 2006 was
$10,436, $8,756 and $7,185, respectively. Amortization expense for the five fiscal years succeeding
March 31, 2008 by year is expected to be as follows: 2009: $10,544; 2010: $10,294; 2011: $8,546;
2012: $6,997; 2013: $6,792.

Effective February 9, 2007, the Company, through its Triumph Air Repair subsidiary, included in

the Aftermarket Services segment, entered into a software licensing agreement with Honeywell
Intellectual Properties, Inc. (‘‘Honeywell’’). The agreement grants Triumph a non-exclusive, limited
license to access Honeywell proprietary commercial service manuals identified for use on the Boeing
331-250[G] APU installed on the United States Air Force C-17 aircraft. The license expires on
September 30, 2013. As consideration, the Company agreed to pay $5,000 inclusive of imputed interest
of $529, of which $700 and $1,500 was paid during fiscal years 2008 and 2007, respectively. At
March 31, 2008, the remaining payable to Honeywell of $2,302 is included in the balance sheet in
accrued expenses and deferred income taxes and other in the amounts of $631 and $1,671, respectively.
As a result of the agreement, the Company recorded an intangible asset in the amount of $4,471, which
is included in product rights and licenses intangible assets, with a life of 6.7 years. The Company
amortized to expense $671 and $112 of this intangible during fiscal years 2008 and 2007, respectively.

Effective January 1, 2005, the Company, through its Triumph Gear Systems—Macomb subsidiary,
included in the Aerospace Systems segment, entered into an exclusive agreement with General Electric
(‘‘GE’’) to provide the inlet gearbox as well as specific related spare parts for the CFM56 engine
program for the life of the program. The Boeing 737 and the Airbus A318, A319, A320, A321 and
A340-200/-300 aircraft are the primary platforms for the CFM56 engine. As consideration, the
Company agreed to pay an amount of $32,158 for the exclusive right to use certain propriety
technology owned by GE, of which $2,572, $10,200, $14,232 and $5,154 was paid during fiscal 2008,
2007, 2006 and fiscal 2005, respectively. As a result of the agreement, the Company recorded an
intangible asset in the amount of $32,158, which is included in product rights and licenses intangible
assets, with a weighted-average life of 12.1 years. The Company amortized to expense $2,814, $2,816,
and $2,808 of this intangible asset during fiscal 2008, 2007 and 2006, respectively.

16. COMMITMENTS AND CONTINGENCIES

Certain of the Company’s business operations and facilities are subject to a number of federal,
state, local and foreign environmental laws and regulations. Former owners generally indemnify the
Company for environmental liabilities related to the assets and businesses acquired which existed prior
to the acquisition dates. In the opinion of management, there are no significant environmental concerns
which would have a material effect on the financial condition or operating results of the Company
which are not covered by such indemnification.

In the ordinary course of our business, we are also involved in disputes, claims, lawsuits, and

governmental and regulatory inquiries that we deem to be immaterial. Some may involve claims or
potential claims of substantial damages, fines or penalties. While we cannot predict the outcome of any
pending or future litigation or proceeding and no assurances can be given, we do not believe that any
pending matter will have a material effect, individually or in the aggregate, on our financial position or
results of operations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

17. COLLECTIVE BARGAINING AGREEMENTS

Approximately 14% of the Company’s labor force is covered under collective bargaining

agreements.

18. SEGMENTS

The Company is organized based on the products and services that it provides. Under this

organizational structure, the Company has two reportable segments: the Aerospace Systems Group and
the Aftermarket Services Group. The Company evaluates performance and allocates resources based on
operating income of each reportable segment. The accounting policies of the reportable segments are
the same as those described in the summary of significant accounting policies (see Note 2). Each
segment has a president and controller who manage their respective segment. The segment president
reports directly to the President and CEO of the Company, the Chief Operating Decision Maker
(‘‘CODM’’), as defined in SFAS No. 131, Disclosure about Segments of an Enterprise and Related
Information. The segment presidents maintain regular contact with the CODM to discuss operating
activities, financial results, forecasts and plans for the segment. The segment controllers have dual
reporting responsibilities, reporting to both their segment president as well as the Corporate Controller.
The Company’s CODM evaluates performance and allocates resources based upon review of segment
information. The CODM utilizes operating income as a primary measure of profitability.

Our Aerospace Systems segment consists of 34 operating locations, and the Aftermarket Services

segment consists of 17 operating locations at March 31, 2008.

The Aerospace Systems segment consists of the Company’s operations which manufacture products

primarily for the aerospace OEM market. The segment’s operations design and engineer mechanical
and electromechanical controls, such as hydraulic systems, main engine gearbox assemblies,
accumulators and mechanical control cables. The segment’s revenues are also derived from stretch
forming, die forming, milling, bonding, machining, welding and assembly and fabrication of various
structural components used in aircraft wings, fuselages and other significant assemblies. Further, the
segment’s operations also manufacture metallic and composite bonded honeycomb assemblies for floor
panels, fuselage, wings and flight control surface parts. These products are sold to various aerospace
OEMs on a global basis.

The Aftermarket Services segment consists of the Company’s operations that provide maintenance,

repair and overhaul services to both commercial and military markets on components and accessories
manufactured by third parties. Maintenance, repair and overhaul revenues are derived from services on
auxiliary power units, aircraft accessories, including constant-speed drives, cabin compressors, starters
and generators, and pneumatic drive units. In addition, the segment’s operations repair and overhaul
thrust reversers, nacelle components and other aerostructures. The segment’s operations also perform
repair and overhaul services, and supply spare parts, for various types of cockpit instruments and
gauges for a broad range of commercial airlines on a worldwide basis.

Segment operating income is total segment revenue reduced by operating expenses identifiable

with that segment. Corporate includes general corporate administrative costs and any other costs not
identifiable with one of the Company’s segments.

The Company does not accumulate net sales information by product or service or groups of similar

products and services, and therefore the Company does not disclose net sales by product or service
because to do so would be impracticable.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

18. SEGMENTS (Continued)

Selected financial information for each reportable segment is as follows:

Year Ended March 31,

2008

2007

2006

Net sales:

Aerospace systems . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket services . . . . . . . . . . . . . . . . . . . . . . . . . .
Elimination of inter-segment sales . . . . . . . . . . . . . . . . .

$ 907,376
246,609
(2,895)

$743,742
196,526
(2,941)

$593,759
159,198
(3,589)

$1,151,090

$937,327

$749,368

Income before income taxes:
Operating income (loss):

Aerospace systems . . . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket services . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$ 124,812
23,480
(21,967)

$101,867
11,384
(19,352)

$ 67,122
8,556
(14,507)

Interest expense and other . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . .
Charge for early extinguishment of debt

Depreciation and amortization:

Aerospace systems . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket services . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Capital expenditures:

126,325
13,422
—

93,899
11,706
5,088

61,171
10,304
—

$ 112,903

$ 77,105

$ 50,867

30,007
12,943
265

$ 26,080
9,394
229

$ 23,278
7,396
153

43,215

$ 35,703

$ 30,827

40,762
20,652
954

$ 39,220
19,672
299

$ 17,148
10,470
373

62,368

$ 59,191

$ 27,991

March 31,
2008

March 31,
2007

Total Assets:

Aerospace systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Aftermarket services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$1,034,294
321,757
34,021
24,763

$ 883,890
272,972
34,382
28,643

$1,414,835

$1,219,887

During fiscal years 2008, 2007 and 2006, the Company had foreign sales of $237,043, $201,920 and
$167,791, respectively. The Company reports as foreign sales those sales with delivery points outside of
the United States.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

19. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

BUSINESS SEGMENT SALES

Fiscal 2008

Fiscal 2007(1)

June 30

Sept. 30

Dec. 31 Mar. 31

June 30

Sept. 30

Dec. 31 Mar. 31

(2)

Aerospace Systems . . . . . . . . . $217,280 $220,511 $213,025 $256,560 $172,573 $178,520 $187,846 $204,803
55,585
Aftermarket Services . . . . . . . .
(622)
Inter-segment Elimination . . . .

46,447
(1,024)

44,035
(746)

50,459
(549)

58,313
(589)

60,054
(793)

62,728
(654)

65,514
(859)

TOTAL SALES . . . . . . . . . . . $275,004 $279,772 $275,099 $321,215 $217,996 $221,809 $237,756 $259,766

GROSS PROFIT(3) . . . . . . . . . . $ 81,118 $ 80,043 $ 76,462 $ 91,179 $ 59,770 $ 63,184 $ 67,364 $ 75,171

OPERATING INCOME

Aerospace Systems . . . . . . . . . $ 30,329 $ 31,135 $ 26,095 $ 37,253 $ 20,341 $ 25,332 $ 26,064 $ 30,130
2,950
Aftermarket Services . . . . . . . .
(6,514)
Corporate . . . . . . . . . . . . . . .

2,989
(4,112)

3,229
(4,780)

6,519
(3,888)

6,408
(8,159)

2,216
(3,946)

5,728
(5,803)

4,825
(4,117)

TOTAL OPERATING INCOME . $ 30,254 $ 31,843 $ 28,726 $ 35,502 $ 19,218 $ 23,602 $ 24,513 $ 26,566

INCOME FROM

Continuing Operations . . . . . . . $ 17,811 $ 18,702 $ 17,923 $ 21,306 $ 10,466 $ 13,272 $ 11,730 $ 15,508
(1,282)
Discontinued Operations . . . . .

(1,206)

(1,896)

(3,894)

(1,472)

(1,033)

(929)

(661)

NET INCOME . . . . . . . . . . . . . $ 13,917 $ 17,230 $ 16,717 $ 19,410 $

9,433 $ 12,611 $ 10,801 $ 14,226

Basic Earnings per Share(4)

Continuing Operations . . . . . . . $
Discontinued Operations . . . . .

1.08 $
(0.24)

1.13 $
(0.09)

1.08 $
(0.07)

1.30 $
(0.12)

0.65 $
(0.06)

0.82 $
(0.04)

0.72 $
(0.06)

0.95
(0.08)

Net Income . . . . . . . . . . . . . . $

0.85 $

1.04 $

1.01 $

1.18 $

0.59 $

0.78 $

0.66 $

0.87

Diluted Earnings per share(4)(5)

Continuing Operations . . . . . . . $
Discontinued Operations . . . . .

1.04 $
(0.23)

1.05 $
(0.08)

1.00 $
(0.07)

1.26 $
(0.11)

0.64 $
(0.06)

0.81 $
(0.04)

0.71 $
(0.06)

0.93
(0.08)

Net Income . . . . . . . . . . . . . . $

0.81 $

0.97 $

0.93 $

1.15 $

0.58 $

0.77 $

0.66 $

0.86

(1) The historical amounts presented above have been reclassified to present the Company’s former Triumph

Precision and Triumph Precision Castings businesses as discontinued operations.

(2) The results for the third quarter of fiscal 2007 include a charge to earnings of $5,088 ($3,307 after tax or

$0.20 per diluted share) for early extinguishment of debt.

(3) Gross profit includes depreciation.

(4) The sum of the earnings for Continuing Operations and Discontinued Operations does not necessarily equal

the earnings for the quarter due to rounding.

(5) The sum of the diluted earnings per share for the four quarters does not necessarily equal the total year

diluted earnings per share due to the dilutive effect of the potential common shares related to the convertible
debt.

TRIUMPH GROUP, INC.

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS
(Dollars in thousands)

Balance
at beginning of
year

Additions
charged to
expense

Additions(1)
(Deductions)(2)

Balance at
end of year

For year ended March 31, 2008:

Allowance for doubtful accounts receivable . . . .

$3,857

For year ended March 31, 2007:

Allowance for doubtful accounts receivable . . . .

$3,625

For year ended March 31, 2006:

Allowance for doubtful accounts receivable . . . .

$5,176

For year ended March 31, 2005:

1,687

1,036

983

Allowance for doubtful accounts receivable . . . .

$7,272

2,071

130
(951)
23
(827)
(14)
(2,520)
451
(4,618)

$4,723

$3,857

$3,625

$5,176

(1) Additions consist of accounts receivable recoveries, miscellaneous adjustments and amounts

recorded in conjunction with the acquisitions of B & R, Allied, Grand Prairie, Parker Hannifin’s
United Aircraft Products Division and Triumph Gear Systems, Inc.

(2) Deductions represent write-offs of related account balances.

Item 9.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information
required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported
within the time periods specified in the SEC’s rules and forms, and that such information is
accumulated and communicated to our management, including our principal executive officer and
principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In
designing and evaluating the disclosure controls and procedures, management recognized that any
controls and procedures, no matter how well designed and operated, can provide only reasonable
assurance of achieving the desired control objectives, and management necessarily was required to
apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As of March 31, 2008, we completed an evaluation, under the supervision and with the
participation of our management, including our principal executive officer and principal financial
officer, of the effectiveness of the design and operation of our disclosure controls and procedures.
Based on the foregoing, our principal executive officer and principal financial officer concluded that
our disclosure controls and procedures were effective at the reasonable assurance level as of March 31,
2008.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of Triumph Group, Inc. (‘‘Triumph’’) is responsible for establishing and

maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and
15d-15(f) under the Securities Exchange Act of 1934. Triumph’s internal control system over financial
reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with U.S. generally
accepted accounting principles. The company’s internal control over financial reporting includes those
policies and procedures that:

(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect

the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit

preparation of financial statements in accordance with U.S. generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and

(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized

acquisition, use or disposition of the company’s assets that could have a material effect on the
financial statements.

Because of inherent limitations, internal control over financial reporting may not prevent or detect

misstatements. Therefore, even those systems determined to be effective can provide only reasonable
assurance with respect to financial statement preparation and presentation. Also, projections of any
evaluation of effectiveness to future periods are subject to risk that controls may become inadequate
because of changes in condition, or that the degree of compliance with the policies or procedures may
deteriorate.

Triumph’s management assessed the effectiveness of Triumph’s internal control over financial
reporting as of March 31, 2008. In making this assessment, management used the criteria set forth by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-
Integrated Framework. Based on management’s assessment and those criteria, management believes
that Triumph maintained effective internal control over financial reporting as of March 31, 2008.

Triumph’s independent registered public accounting firm, Ernst & Young LLP, has issued an audit

report on the effectiveness of Triumph’s internal control over financial reporting. This report appears
on page 82.

/s/ RICHARD C. ILL

Richard C. Ill
President and Chief Executive Officer

/s/ M. DAVID KORNBLATT

Senior Executive Vice President,
Chief Financial Officer & Treasurer

/s/ KEVIN E. KINDIG

Kevin E. Kindig
Vice President and Controller

May 28, 2008

Report of Independent Registered Public Accounting Firm on Internal Control Over
Financial Reporting

To the Board of Directors and Stockholders of Triumph Group, Inc.

We have audited Triumph Group, Inc.’s internal control over financial reporting as of March 31,
2008, based on criteria established in Internal Control—Integrated Framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Triumph Group Inc.’s
management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting included in the
accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility
is to express an opinion on the company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether effective internal control over financial reporting was maintained
in all material respects. Our audit included obtaining an understanding of internal control over
financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design
and operating effectiveness of internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable

assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A company’s internal
control over financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only
in accordance with authorizations of management and directors of the company; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or

detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.

In our opinion, Triumph Group, Inc. maintained, in all material respects, effective internal control

over financial reporting as of March 31, 2008, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the consolidated balance sheets of Triumph Group, Inc., as of
March 31, 2008 and 2007, and the related consolidated statements of income, stockholders’ equity, and
cash flows for each of the three years in the period ended March 31, 2008 and our report dated
May 27, 2008 expressed an unqualified opinion thereon.

/s/ ERNST & YOUNG LLP

Philadelphia, Pennsylvania
May 27, 2008

Changes in Internal Control Over Financial Reporting

In addition to management’s evaluation of disclosure controls and procedures as discussed above,

we continue to review and enhance our policies and procedures for internal control over financial
reporting.

We have developed and implemented a formal set of internal controls and procedures for financial
reporting in accordance with the SEC’s rules regarding management’s report on internal controls. As a
result of continued review and testing by management and by our internal and independent auditors,
additional changes may be made to our internal controls and procedures. However, we did not make
any changes to our internal control over financial reporting in our fourth quarter of fiscal 2008 that has
materially affected or is reasonably likely to materially affect our internal control over financial
reporting.

Item 9B. Other Information

None.

Item 10. Directors, Executive Officers and Corporate Governance

PART III

The information required for directors is incorporated herein by reference to our definitive Proxy
Statement for our 2008 Annual Meeting of Stockholders, which shall be filed within 120 days after the
end of our fiscal year (the ‘‘2008 Proxy Statement’’). Information required by this item concerning
executive officers is included in Part I of this Annual Report on Form 10-K.

Section 16(a) Beneficial Ownership Reporting Compliance

The information required regarding Section 16(a) beneficial ownership reporting compliance is

incorporated herein by reference to the 2008 Proxy Statement.

The information required regarding our Code of Business Conduct is incorporated herein by

reference to the 2008 Proxy Statement.

Code of Business Conduct

Stockholder Nominations

The information required with respect to any material changes to the procedures by which

stockholders may recommend nominees to the Company’s board of directors is incorporated herein by
reference to the 2008 Proxy Statement.

Audit Committee

The information required with respect to the Audit Committee and Audit Committee financial

experts is incorporated herein by reference to the 2008 Proxy Statement.

Item 11. Executive Compensation

The information required regarding executive compensation is incorporated herein by reference to

the 2008 Proxy Statement.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder

Matters

The information required under this item is incorporated herein by reference to the 2008 Proxy

Statement.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required under this item is incorporated herein by reference to the 2008 Proxy

Statement.

Item 14. Principal Accounting Fees and Services

The information required under this item is incorporated herein by reference to the 2008 Proxy

Statement.

Item 15. Exhibits, Financial Statement Schedules

(a) Financial Statements

PART IV

(1) The following consolidated financial statements are included in Item 8 of this report:

Triumph Group, Inc.

Report of Ernst & Young LLP, Independent Registered Public Accounting Firm . . . . . .
Consolidated Balance Sheets as of March 31, 2008 and 2007 . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Income for the Fiscal Years Ended March 31, 2008, 2007

and 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Stockholders’ Equity for the Fiscal Years Ended March 31,

2008, 2007 and 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Cash Flows for the Fiscal Years Ended March 31, 2008,

2007 and 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) The following financial statement schedule is included in this report:

Schedule II—Valuation and Qualifying Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

44
45

48
49

Page

All other schedules have been omitted as not applicable or because the information is included

elsewhere in the Consolidated Financial Statements or notes thereto.

(3) The following is a list of exhibits. Where so indicated by footnote, exhibits which were

previously filed are incorporated by reference.

Exhibit
Number

3.1

3.2

3.3

4.1

Description

Amended and Restated Certificate of Incorporation of Triumph Group, Inc.(1)

Bylaws of Triumph Group, Inc.(1)

Certificate of Amendment to Amended and Restated Certificate of Incorporation of
Triumph Group, Inc.(2)

Form of certificate evidencing Common Stock of Triumph Group, Inc.(1)

Exhibit
Number

4.2

4.3

4.4

10.1

10.2

Indenture, dated as of September 18, 2006, between Triumph Group, Inc. and The Bank of
New York Trust Company, N.A. relating to the 2.625% Convertible Senior Subordinated
Notes Due 2026.(3)

Description

Form of the 2.625% Convertible Senior Subordinated Note Due 2026. (Included as
Exhibit A to Exhibit 4.2).(3)

Registration Rights Agreement, dated as of September 18, 2006, between Triumph
Group, Inc. and Banc of America Securities LLC.(3)

Amended and Restated Directors’ Stock Incentive Plan.(4)

Form of Deferred Stock Unit Award Agreement under the Amended and Restated
Directors’ Stock Incentive Plan.(4)

10.3#

2004 Stock Incentive Plan.(5)

10.4

10.4(a)

10.4(b)

10.4(c)

10.4(d)

Amended and Restated Credit Agreement (the ‘‘Amended and Restated Credit Agreement’’)
dated July 27, 2005 among Triumph Group, Inc., PNC Bank National Association, as
Administrative Agent, Bank of America, N.A., as Syndication Agent, Citizens Bank of
Pennsylvania, as Documentation Agent, and Manufacturers and Traders Trust Company, as
Managing Agent, National City Bank of Pennsylvania, as Managing Agent and PNC Capital
Markets, Inc., as Lead Arrangers and the Banks party thereto.(6)

First Amendment to Amended and Restated Credit Agreement, dated September 18,
2006.(7)

Second Amendment to Amended and Restated Credit Agreement, dated October 20,
2006.(7)

Third Amendment to Amended and Restated Credit Agreement, dated December 22,
2006.(8)

Fourth Amendment to Amended and Restated Credit Agreement, dated October 15,
2007.(9)

10.5#

Triumph Group, Inc. Supplemental Executive Retirement Plan effective January 1, 2003.(10)

10.6

10.7

10.8

10.9

10.10

21.1*

23.1*

31.1*

31.2*

32.1*

Compensation for the non-employee members of the Board of Directors of Triumph
Group, Inc.(4)

Form of Stock Award Agreement under the 2004 Stock Incentive Plan.(11)

Description of the Triumph Group, Inc. Annual Cash Bonus Plan.(12)

Change of Control Employment Agreement with: Richard C. Ill, M. David Kornblatt,
John B. Wright, II and Kevin E. Kindig.(13)

Restricted Stock Award Agreement for M. David Kornblatt.(14)

Subsidiaries of Triumph Group, Inc.

Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.

Principal Executive Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a)
under the Securities Exchange Act of 1934, as amended.

Principal Financial Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under
the Securities Exchange Act of 1934, as amended.

Principal Executive Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b)
under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.

Exhibit
Number

32.2*

Principal Financial Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b)
under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.

Description

(1) Incorporated by reference to our Registration Statement on Form S-1 (Registration

No. 333-10777), declared effective on October 24, 1996.

(2) Incorporated by reference to our Annual Report on Form 10-K for the year ended March 31,

1999.

(3) Incorporated by reference to our Current Report on Form 8-K filed on September 22, 2006.

(4) Incorporated by reference to our Current Report on Form 8-K filed on August 1, 2006.

(5) Incorporated by reference to our Proxy Statement on Schedule 14A for the 2004 Annual Meeting

of Stockholders.

(6) Incorporated by reference to our Current Report on Form 8-K filed August 2, 2005.

(7) Incorporated by reference to our Current Report on Form 8-K filed on October 26, 2006.

(8) Incorporated by reference to our Current Report on Form 8-K filed on December 29, 2006.

(9) Incorporated by reference to our Quarterly Report on Form 10-Q for the quarter ended

September 30, 2007.

(10) Incorporated by reference to our Annual Report on Form 10-K for the year ended March 31, 2003

(11) Incorporated by reference to our Current Report on Form 8-K filed on June 12, 2007.

(12) Incorporated by reference to our Current Report on Form 8-K filed on July 31, 2007.

(13) Incorporated by reference to our Current Report on Form 8-K filed on March 13, 2008

(14) Incorporated by reference to our Current Report on Form 8-K filed on June 14, 2007.

Filed herewith.

# Compensation plans and arrangements for executives and others.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed by the undersigned, thereunto duly
authorized.

SIGNATURES

TRIUMPH GROUP, INC.

Dated: May 28, 2008

By: /s/ RICHARD C. ILL

Richard C. Ill
President and Chief Executive Officer
(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has

been signed below by the following persons on behalf of the Registrant and in the capacities and on
the dates indicated.

Each person whose signature appears below in so signing also makes, constitutes and appoints

Richard C. Ill and M. David Kornblatt, and each or anyone of them, his true and lawful
attorneys-in-fact and agents with full power of substitution and resubstitution, for him and, in his name,
place and stead in any and all capacities to execute and cause to be filed with the Securities and
Exchange Commission any or all amendments to this report.

/s/ RICHARD C. ILL

Richard C. Ill

President, Chief Executive Officer and Director
(Principal Executive Officer)

May 28, 2008

/s/ M. DAVID KORNBLATT

M. David Kornblatt

Senior Vice President, Chief Financial Officer
and Treasurer (Principal Financial Officer)

May 28, 2008

/s/ KEVIN E. KINDIG

Kevin E. Kindig

Vice President and Controller (Principal
Accounting Officer)

/s/ WILLIAM O. ALBERTINI

William O. Albertini

/s/ RICHARD C. GOZON

Richard C. Gozon

/s/ CLAUDE F. KRONK

Claude F. Kronk

/s/ GEORGE SIMPSON

George Simpson

/s/ TERRY D. STINSON

Terry D. Stinson

Director

May 28, 2008

Exhibit
Number

3.1

3.2

3.3

4.1

4.2

4.3

4.4

10.1

10.2

EXHIBIT INDEX

Description

Amended and Restated Certificate of Incorporation of Triumph Group, Inc.(1)

Bylaws of Triumph Group, Inc.(1)

Certificate of Amendment to Amended and Restated Certificate of Incorporation of Triumph
Group, Inc.(2)

Form of certificate evidencing Common Stock of Triumph Group, Inc.(1)

Indenture, dated as of September 18, 2006, between Triumph Group, Inc. and The Bank of
New York Trust Company, N.A. relating to the 2.625% Convertible Senior Subordinated
Notes Due 2026.(3)

Form of the 2.625% Convertible Senior Subordinated Note Due 2026. (Included as Exhibit A
to Exhibit 4.2).(3)

Registration Rights Agreement, dated as of September 18, 2006, between Triumph
Group, Inc. and Banc of America Securities LLC.(3)

Amended and Restated Directors’ Stock Incentive Plan.(4)

Form of Deferred Stock Unit Award Agreement under the Amended and Restated
Directors’ Stock Incentive Plan.(4)

10.3#

2004 Stock Incentive Plan.(5)

10.4

10.4(a)

10.4(b)

10.4(c)

10.4(d)

First Amendment to Amended and Restated Credit Agreement, dated September 18,
2006.(7)

Second Amendment to Amended and Restated Credit Agreement, dated October 20,
2006.(7)

Third Amendment to Amended and Restated Credit Agreement, dated December 22,
2006.(8)

Fourth Amendment to Amended and Restated Credit Agreement, dated October 15,
2007.(9)

10.5#

Triumph Group, Inc. Supplemental Executive Retirement Plan effective January 1, 2003.(10)

10.6

10.7

10.8

10.9

Compensation for the non-employee members of the Board of Directors of Triumph
Group, Inc.(4)

Form of Stock Award Agreement under the 2004 Stock Incentive Plan.(11)

Description of the Triumph Group, Inc. Annual Cash Bonus Plan.(12)

Change of Control Employment Agreement with: Richard C. Ill, M. David Kornblatt,
John B. Wright, II and Kevin E. Kindig.(13)

Exhibit
Number

10.10

21.1*

23.1*

31.1*

31.2*

32.1*

32.2*

Restricted Stock Award Agreement for M. David Kornblatt.(14)

Subsidiaries of Triumph Group, Inc.

Description

Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.

Principal Executive Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under
the Securities Exchange Act of 1934, as amended.

Principal Financial Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under
the Securities Exchange Act of 1934, as amended.

Principal Executive Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b)
under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.

Principal Financial Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under
the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.

(1) Incorporated by reference to our Registration Statement on Form S-1 (Registration

No. 333-10777), declared effective on October 24, 1996.

(2) Incorporated by reference to our Annual Report on Form 10-K for the year ended March 31,

1999.

(3) Incorporated by reference to our Current Report on Form 8-K filed on September 22, 2006.

(4) Incorporated by reference to our Current Report on Form 8-K filed on August 1, 2006.

(5) Incorporated by reference to our Proxy Statement on Schedule 14A for the 2004 Annual Meeting

of Stockholders.

(6) Incorporated by reference to our Current Report on Form 8-K filed August 2, 2005.

(7) Incorporated by reference to our Current Report on Form 8-K filed on October 26, 2006.

(8) Incorporated by reference to our Current Report on Form 8-K filed on December 29, 2006.

(9) Incorporated by reference to our Quarterly Report on Form 10-Q for the quarter ended

September 30, 2007.

(10) Incorporated by reference to our Annual Report on Form 10-K for the year ended March 31, 2003

(11) Incorporated by reference to our Current Report on Form 8-K filed on June 12, 2007.

(12) Incorporated by reference to our Current Report on Form 8-K filed on July 31, 2007.

(13) Incorporated by reference to our Current Report on Form 8-K filed on March 13, 2008

(14) Incorporated by reference to our Current Report on Form 8-K filed on June 14, 2007.

Filed herewith.

# Compensation plans and arrangements for executives and others.

SUBSIDIARIES OF TRIUMPH GROUP, INC.

Exhibit 21.1

Triumph Brands, Inc.

Triumph Group Acquisition Corp.

Triumph Group Acquisition Holdings, Inc.

The Triumph Group Operations, Inc.

CBA Acquisition LLC

Triumph Controls (Europe) SAS

Construction Brevetees d’Alfortville SAS

HT Parts LLC

Kilroy Steel, Inc.

Kilroy Structural Steel Co.

Lamar Electro-Air Corp.

Nu-Tech Brands, Inc.

Triumph Accessory Services—Grand Prairie, Inc.

Triumph Actuation Systems, LLC

Triumph Actuation Systems—Connecticut, LLC

Triumph Actuation Systems—Valencia, Inc.

Triumph Aerospace Systems Group, Inc.

Triumph Aerospace Systems—Wichita, Inc.

Triumph Aerospace Systems—Newport News, Inc.

Triumph Aftermarket Services Group, Inc.

Triumph Logistics- UK, Ltd.

Triumph Airborne Structures, Inc.

Triumph Aviations Inc.

Triumph Aviation Services Asia, Ltd.

Triumph Composite Systems, Inc.

Triumph Controls, LLC

Triumph Engineering Services, Inc.

Triumph Engineered Solutions, Inc.

Triumph Fabrications—Fort Worth, Inc.

Triumph Fabrications—Hot Springs, Inc.

Triumph Fabrications—San Diego, Inc.

Triumph Gear Systems, Inc.

Triumph Gear Systems—Macomb, Inc.

Triumph Instruments, Inc.

Triumph Instruments—Burbank, Inc.

Triumph Interiors Limited

Triumph Interiors, LLC

Triumph Metals Company

Triumph Precision, Inc.

Triumph Precision Castings Co.

Triumph Processing, Inc.

Triumph Structures—Kansas City, Inc.

Triumph Structures—Long Island, LLC

Triumph Structures—Los Angeles, Inc.

Triumph Structures—Wichita, Inc.

Triumph Thermal Systems, Inc.

Triumph Turbine Services, Inc.

Exhibit 23.1

Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:

1) Registration Statements (Form S-8 No. 333-36957 and Form S-8 No. 333-50056) pertaining to

the 1996 Stock Option Plan of Triumph Group, Inc.;

2) Registration Statements (Form S-8 No. 333-81665 and Form S-8 No. 333-134861) pertaining to

the Amended and Restated Directors’ Stock Incentive Plan of Triumph Group, Inc.;

3) Registration Statement (Form S-8 No. 333-125888) pertaining to the 2004 Stock Incentive Plan

of Triumph Group, Inc.; and

4) Registration Statement (Form S-3 No. 333-139323) pertaining to the resale of the Triumph

Group, Inc. 2.625% Convertible Senior Notes Due 2026 and the shares of Triumph
Group, Inc. Common Stock issuable upon conversion,

of our reports dated May 27, 2008, with respect to the consolidated financial statements and schedule
of Triumph Group, Inc. and the effectiveness of internal control over financial reporting of Triumph
Group, Inc., included in this Annual Report (Form 10-K) for the year ended March 31, 2008.

Philadelphia, Pennsylvania
May 27, 2008

/s/ Ernst & Young LLP

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF
THE SECURITIES AND EXCHANGE ACT OF 1934

I, Richard C. Ill, certify that:

I have reviewed this annual report on Form 10-K of Triumph Group, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period
covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in
this report, fairly present in all material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining

disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for
the registrant and have:

designed such disclosure controls and procedures, or caused such disclosure controls and

procedures to be designed under our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principals;

evaluated the effectiveness of the registrant’s disclosure controls and procedures and
presented in this report our conclusions about the effectiveness of the disclosure controls and
procedures as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial
reporting that occurred during the registrant’s fourth fiscal quarter that has materially affected, or
is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent
evaluation of internal control over financial reporting, to the registrant’s auditors and the audit
committee of the registrant’s board of directors (or persons performing the equivalent functions):

all significant deficiencies and material weaknesses in the design or operation of internal

control over financial reporting which are reasonably likely to adversely affect the registrant’s
ability to record, process, summarize and report financial information; and

any fraud, whether or not material, that involves management or other employees who

have a significant role in the registrant’s internal control over financial reporting.

Dated: May 28, 2008

/s/ RICHARD C. ILL

Richard C. Ill
President and Chief Executive Officer (Principal
Executive Officer)

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF
THE SECURITIES AND EXCHANGE ACT OF 1934

I, M. David Kornblatt, certify that:

I have reviewed this annual report on Form 10-K of Triumph Group, Inc.;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining

designed such disclosure controls and procedures, or caused such disclosure controls and

all significant deficiencies and material weaknesses in the design or operation of internal

control over financial reporting which are reasonably likely to adversely affect the registrant’s
ability to record, process, summarize and report financial information; and

any fraud, whether or not material, that involves management or other employees who

have a significant role in the registrant’s internal control over financial reporting.

Dated: May 28, 2008

/s/ M. DAVID KORNBLATT

M. David Kornblatt
Senior Vice President, Chief Financial Officer and
Treasurer (Principal Financial Officer)

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Exhibit 32.1

In connection with the Annual Report of Triumph Group, Inc. (the ‘‘Company’’) on Form 10-K for

the year ended March 31, 2008 as filed with the Securities and Exchange Commission on the date
hereof (the ‘‘Report’’), I, Richard C. Ill, President, and Chief Executive Officer of the Company,
certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002,
to the best of my knowledge, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities

Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial

condition and results of operations of the Company.

By: /s/ RICHARD C. ILL

Richard C. Ill
President and Chief Executive Officer
(Principal Executive Officer)
May 28, 2008

A signed original of this written statement required by Section 906 has been provided to Triumph
Group, Inc. and will be retained by Triumph Group, Inc. and furnished to the Securities and Exchange
Commission or its staff upon request.

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Exhibit 32.2

In connection with the Annual Report of Triumph Group, Inc. (the ‘‘Company’’) on Form 10-K for

the year ended March 31, 2008 as filed with the Securities and Exchange Commission on the date
hereof (the ‘‘Report’’), I, M. David Kornblatt, Senior Vice President, Chief Financial Officer and
Treasurer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the
Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities

Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial

condition and results of operations of the Company.

By: /s/ M. DAVID KORNBLATT

M. David Kornblatt
Senior Vice President, Chief Financial Officer and
Treasurer(Principal Financial Officer)
May 28, 2008