Interview With The Chairman And CEO: Moog Inc. (MOG-A) - Robert T. Brady And John Scannell
January 5, 2012 - The Wall Street Transcript has just published Aerospace and Defense Report offering a timely review of the sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.
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Robert T. Brady is Chairman and Chief Executive Officer of Moog Inc. He earned a B.S. in mechanical engineering at the Massachusetts Institute of Technology in 1962, completed a tour of duty as a Naval Officer in 1964 and then attended the Harvard Business School. He joined Moog in 1966 immediately after Harvard. In 1968, Mr. Brady became the Manufacturing Manager of Moog's aerospace division, and in 1976 was named Vice President and General Manager. In 1981, the aerospace division was reorganized into four divisions and Mr. Brady became President in the aerospace group and a Moog Director. In 1988, when Bill Moog, the Founder and CEO of Moog, retired from active participation in the company, the board of directors elected Mr. Brady as President and CEO. In 1996, he was elected Chairman.John Scannell is President and Chief Operating Officer of Moog Inc. He joined the company in 1990 as an Engineering Manager of Moog's company in Cork, Ireland.
TWST: Please start by introducing us to Moog with a brief company history and an overview of your operations and focus today.
Mr. Brady: Our company was founded in 1951 around the invention of a device called a servovalve. It was founded by Bill Moog, who was at that time a Research Engineer at a laboratory that was part of Cornell University. He was offered the opportunity to take a leave of absence and start a business, and he took that offer and he succeeded. Servovalves became the heart of very high-performance electrohydraulic motion-control systems. Over the last 60 years, our company has elaborated and extended our capability in high-performance motion-control systems.
Today, we consider ourselves one of the world's leading designers and suppliers of this kind of equipment. We build controls that are used to position flight surfaces on military and commercial aircraft, controls that steer the rockets that launch satellites and then position the satellites in orbit. We build controls for various types of high-performance industrial machinery. A few years ago we established an initiative in the medical devices market, and we are now a designer and supplier of infusion pumps for both intravenous applications and enteral feeding.
Today our company has just finished a fiscal year with sales of about $2.3 billion, earnings of $136 million. We employ over 10,000 people worldwide, and 4,000 of those folks are citizens of countries other than the U.S. They're part of an international network of 27 companies we have in other countries. Over the last 60 years, we've built on the foundation of the technology that Bill developed, and we're now a specialist on a global basis in very high-performance motion-control systems.
TWST: Would you talk about your typical customers?
Mr. Brady: The end users are different depending on which market we're talking about. In the aircraft business, we're a supplier to the major aerospace and defense contractors. In the military, that would include of course Lockheed Martin and Boeing. We also do business with General Dynamics and Raytheon. In commercial aircraft, we're a supplier to both Boeing and Airbus and to some of the producers of business jets, Gulfstream, Bombardier and Hawker Beechcraft. In the space and defense business, once again we're a supplier to Boeing, Lockheed, for satellites, Orbital Sciences, all of the major names. Our industrial customers are a completely different set of companies and a wide variety of companies, and they are the kind of companies that build specialized machinery.
In the flight-simulator business our customers are FlightSafety, CAE and we've begun doing business with Thales in France. In the industrial machinery business, most of our customers are European and Asian companies. In Europe, on the machinery side, they would include companies whose names might not be familiar to American investors. They would be Arbor, Engel, Netstal, a Canadian company Husky. In Asia, our major customers are Mitsubishi and Toshiba. In the medical devices arena, we're both direct and through distribution, and our customers are primarily outpatient clinics.
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