“The balance between the military and the commercial sides of our business is worthy to note. Of equal importance is the balance we strike between new (system) deliveries and aftermarket services.”

Balance

Balance is key to stability in the volatile aerospace and defense marketplace. The balance that Rockwell Collins maintains between its commercial and government businesses is a significant factor in the company’s continued success. During cycles in the market, we are better positioned to offset declines in one business with growth in another.

In July 2001, our commercial business accounted for nearly 60 percent of revenues. Three months later we faced a precipitous downturn in the air transport segment due to the Sept. 11 terrorist attacks. Fortunately, our balanced business model helped us weather that storm as increases in government programs offset the commercial downturn.

Subsequently, as the economy recovered and passengers once again took to the air, the commercial business rebounded. Today, Rockwell Collins finds itself in a similar situation. With business aviation and air transport markets depressed by a severe recession, our government business has buoyed the company again, accounting for 58 percent of revenues in fiscal year 2009.

With signs pointing to an inevitable recovery in commercial aviation, Rockwell Collins is well-positioned to take advantage of our positions on numerous new aircraft programs when economic conditions improve.