1. technology and computing
2. electronic components

Investor Presentation
January 2015
Forward Looking Statements
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be
preceded by, followed by or include the words “believes,” “expects,” “anticipates,” “intends,” “plans,” “estimates” or similar expressions. These statements are based on the
beliefs and assumptions of our management. Generally, forward-looking statements include information concerning our possible or assumed future actions, events or results
of operations. Forward looking statements specifically include, without limitation, the information in this presentation regarding: projections; efficiencies/cost avoidance; cost
savings; forward loss reserves; income and margins; earnings per share; growth; economies of scale; the economy; capital expenditures; future financing needs; future
acquisitions and dispositions; litigation; potential and contingent liabilities; management’s plans; and integration related expenses.
Although we believe that the expectations reflected in the forward-looking statements are based on reasonable assumptions, these forward-looking statements are subject to
numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. We cannot guarantee future results,
performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. All
written and oral forward-looking statements made in connection with this presentation that are attributable to us or persons acting on our behalf are expressly qualified in their
entirety by “Risk Factors” and other cautionary statements included herein.
The information in this presentation is not a complete description of our business or the risks. There can be no assurance that other factors will not affect the accuracy of
these forward-looking statements or that our actual results will not differ materially from the results anticipated in such forward-looking statements. Factors that could cause
actual results to differ materially from those estimated by us include, but are not limited to, those factors or conditions described under “Risk Factors” in the Annual Report on
Form 10-K for the year ended December 31, 2013 and the following: the cyclicality of the aerospace market and the level of new commercial aircraft orders, customer
concentration, production rates for various commercial and military aircraft programs, the level of U.S. government defense spending, competitive pricing pressures, start-up
costs and possible overruns on new contracts, technology and product development risks and uncertainties, product performance, increasing consolidation of customers and
suppliers in the aerospace industry, price erosion within the marketplace, the risk of environmental liabilities, possible goodwill or other asset impairments, compliance with
applicable regulatory requirements and changes in regulatory requirements, including regulatory requirements applicable to government contracts and sub-contracts,
imposition of taxes, export controls, tariffs, embargoes and other trade restrictions, economic and geopolitical developments and conditions, our ability to service our
substantial indebtedness, our ability to manage and otherwise comply with our covenants with respect to our significant outstanding indebtedness, unfavorable developments
in the global credit markets, which may make it more difficult to incur new indebtedness or refinance our outstanding indebtedness, our ability to retain key employees, our
inability to maintain current customer and supplier relationships , and risks associated with other acquisitions and dispositions of businesses by us.
We caution the reader that undue reliance should not be placed on any forward-looking statements, which speak only as of the date of this presentation. We do not
undertake any duty or responsibility to update any of these forward-looking statements to reflect events or circumstances after the date of this presentation or to reflect actual
outcomes.
This presentation includes certain non-GAAP financial measures, such as EBITDA and free cash flow. Tables reconciling such non-GAAP financial measures are available in
this presentation.
2
Agenda
• Introduction
• Company Overview
• Key Company Strengths
• Capitalization
• Investment Merits
• Appendix
3
Investment Highlights
• Customer focused leading global provider of
engineering and manufacturing services to aerospace,
defense and diverse technology-driven markets
• Expanded capabilities move us up the value chain to
more sophisticated, higher value-added products
• Well positioned to benefit from increasing market
demand for more advanced integrated systems
• Long-term relationships with blue chip customers
• Sizeable backlog
• Consistent cash flow
4
Ducommun Goal: Expand Capabilities to
Provide More Value-Added Products
Driving the business to become a higher-level integrator
Tier 33
Tier
Components or
detailed parts
5
Tier 2
2
Tier
Tier 11
Tier
OEM
OEM
Manufacture
subassemblies
Manufacture
aircraft sections
and purchase
assemblies
Final
assembly,
finish and
delivery
The “One Ducommun Platform” Forms the Basis for
Achieving Sustainable Profitable Growth
6
Strategic Business Unit Structure
Aligns Capabilities & Creates Synergies
Ducommun LaBarge
Technologies
Ducommun
AeroStructures
(Electronic Solution)
57% of LTM Q3 2014 Sales
(Structural Solutions)
43% of LTM Q3 2014
Electronic
Systems Group
7
Advanced
Systems Group
Structural
Systems Group
Innovative Electronic Solutions
Ducommun LaBarge Technologies (57% of LTM Q3 2014 Sales)
Designs, engineers and manufactures high-reliability products used in worldwide technology-driven markets,
including aerospace and defense, natural resources, industrial, and medical.
Core Capabilities
From prototype development to complex
assemblies:
 Turnkey design, engineering, assembly
and test
 Cable assemblies, wire harnesses and
interconnect systems
Interconnect Systems
 PCB assemblies and
microelectronics/hybrid circuits
 Box-build, electromechanical and
mechanical systems
 Illuminated panels, microwave switches,
and motors and resolvers
Design, Engineering
and Test
Printed Circuit
Board Assemblies
 Systems integration
 Logistics
 After-market support
Integrated Electronic
Assemblies
8
Integrated
Mechanical
Assemblies
Complete System
Builds
Innovative Structural Solutions
Ducommun AeroStructures (43% of LTM Q3 2014 Sales)
Designs, engineers and manufactures large, complex contoured structural components/assemblies, and
composite and metal bonded structures/assemblies for aerospace and defense.
Core Capabilities
Commercial Aircraft
•
Fuselage skin panels & assemblies
•
Flight control surface assemblies
•
Leading edges
Composite Winglets
Military Fixed Wing Aircraft
•
Fuselage skin panels & assemblies
•
Flight control surface assemblies
•
Various door panels
•
Leading edges
•
Engine ducts
Rotor Blade
Assemblies
Fuselage Skins
and Assemblies
Exhaust Systems
and Engine Ducts
Flight Control Surface
Assemblies
Military and Commercial Rotary Wing
Aircraft
9
•
Main & tail rotor blade assemblies
•
Leading edges
•
Firewall exhaust assemblies
•
Sub-assemblies
Ducommun’s End Markets
Offer Growth Opportunities
(Results for the Twelve Months Ended 9/27/14)
(33% of Sales)
Commercial
Aerospace
Defense Structures
(31% of Sales)
Defense Technologies
Industrial
(6% of Sales)
Natural Resources
(6% of Sales)
Medical & Other
(6% of Sales)
(18% of Sales)
• Radar systems
• Flight control
assemblies
• Engine ducts
• Rotor blade assemblies
• Shipboard systems
• Fuselage assemblies
• Rotor blade assemblies
• Leading edges
• Missile systems
• Composite winglets
10
• Glass container
electronic
manufacturing systems
• Electronic test
equipment
• Semiconductor capital
equipment
• Oilfield services
equipment
• Mine automation
systems
• Agricultural control
systems
• Surgical systems
• Patient monitoring and
therapy devices
• Respiratory care
devices
• Biodecontamination
equipment
Diversified End Markets and Platforms with
Strong Industry Fundamentals
Natural Resources
6%
$742 Million
LTM Q3 2014
Sales
Industrial
6%
Commercial
Aerospace
31%
$569 Million
Backlog as
of 9/27/14
Defense Structures
18%
Defense Technologies
33%
End Use Markets
Commercial Aerospace
Defense Technologies
Defense Structures
Natural Resources
Industrial
Medical & Other
Weighted Average Growth Rate
Natural Resources
Medical/Other
4%
4%
Industrial
Defense Structures
4%
16%
Commercial
Aerospace
40%
11
Medical/Other
6%
Defense Technologies
32%
Highly diversified portfolio in low volume, high mix & high margin
businesses
Annual Expected
Growth Rate
4% - 6%
1% - 2%
(5%) - (3%)
1% - 2%
1% - 2%
1% - 2%
1% - 2%
Key Growth Drivers Allowing Ducommun to Expand
Market Presence and Service Capabilities
DAS
• Overall A&D structures market to grow 0-2% over the long-term
• Programs continue to benefit from increased shipments to support the higher
build rates in large commercial aircraft
– Boeing 737NG, 747, 777 and 787 programs
– Airbus A320, A330, A340, A350 and A380 programs
• New commercial opportunities – 737 MAX and A320 NEO
• Expect solid performance on our largest military program - Black Hawk Helicopter
DLT
•
12
Overall low volume, high mix defense technologies market growing 1-2% over
the long-term
– Commercial aerospace and industrial markets will drive growth
– Electronics upgrades and retrofit market fits strategy
A&D Market Forecasted to Grow Steadily through 2019
Driven by Strong Builds in Large Commercial Aircraft
Forecast Deliveries (US$bn)
250
200
Other
Trainers/Light Attack
150
(US$bn)
Regional Aircraft
Military Transports
Rotorcraft
100
Fighters
Commercial Jetliners
Business Aircraft
50
0
2014
2015
2016
Source: Teal Group, September 2014
13
2017
2018
2019
2020
2021
2022
2023
Steady Growth Anticipated for Boeing and Airbus
Driven by Global Demand
Commercial Aircraft Build Rates
Recovery (2013-2017E CAGR = 3%)
Trough
1,600
Recovery
Peak
Trough
1,349
1,404
1,450
1,454
1,274
626
628
642
668
691
588
Aircraft (No.)
1,189
1,200
800
400
684
303
586
605
305
320
832
894
434
453
483
441
2007
668
378
381
281
285
290
398
2002
2003
2004
2005
2006
0
858
979
1,011
498
510
534
481
477
601
648
746
749
763
462
721
375
2008
2009
2010
2011
2012
2013
2014E
2015E
2016E
2017E
Boeing Deliveries
Source:
972
Airbus Deliveries
Boeing, Airbus and Wall Street research
Y-o-Y Change (%)
Global Passenger Traffic and Capacity
20
15
10
5
0
(5)
(10)
(15)
Sep-09
Massive flight cancellations due to the Iceland volcano
Sep-10
Sep-11
Capacity Growth / (Decline)
Source:
IATA
Data as of September 2014
14
14
Sep-12
Traffic Growth
Sep-13
Sep-14
Defense Spending Forecasted to Decline,
But Remains Above Historic Averages
800
Vietnam
War
Reagan
Buildup
War on Terror
Forecast
700
600
($bn)
500
400
300
200
100
0
’62 ’64 ’66 ’68 ’70 ’72 ’74 ’76 ’78 ’80 ’82 ’84 ’86 ’88 ’90 ’92 ’94 ’96 ’98 '00 ’02 ’04 ’06 ’08 ’10 ’12 ’14 ’16 ’18 '20
Source: Congressional Budget Office, November 2014
15
15
We expect defense technologies to grow at 1–2% annually
Our Strategy for Growth
• Establishing Ducommun as an innovative
solutions provider
– Delivering a compelling value proposition to our
customers
– Expanding capabilities to provide more advanced
integrated systems
• Leveraging our portfolio of broad,
complementary capabilities
– Electronic, engineered and structural solutions
– High-performance products and high-cost-offailure applications
– Reorganized into strategic business units to align
capabilities and create synergies
16
Targets for Growth
• Commercial aerospace – Well positioned on key programs
– Boeing 737, 777 & 787; Airbus A320, A330/340, A350 & A380
– New commercial opportunities – 737 MAX and A320 NEO
– Focused on expanding presence with Boeing, Airbus and Spirit
• Jet engines – Growth expected on key commercial and military
fixed-wing aviation programs should drive increased demand in the
engine market
– Established relationships with leading engine manufacturers
– Marketing efforts to expand our customer base
17
Targets for Growth (continued)
• Defense – Focusing on opportunities resulting from military
realignment
– Modifications, foreign military sales and expanded use of electronics
• Energy and Industrial – Our high-mix/low-volume capabilities are in
demand in several niche sectors
– Long-term outlook is brightening; increased order activity
18
Goal to Reduce Leverage to 2.75-3.0x by 2015
Net Debt / LTM EBITDA1
Acquisition
of LaBarge
4.5
2015 Goal
4.2
4.0
3.2
3.5
(x)
3.0
2.75-3.0
2.5
2.0
1.5
1.0
0.5
0.0
Notes:
1
2
19
4/2/2011
9/27/14
12/31/2013
Adjusted for non-recurring items and pro-forma for acquisition of LaBarge
Based on Company Management estimates
12/31/2015 ²
Goal to Reduce Net Leverage from
Current 3.2x to 2.75-3.0x by 2015
($ i n mi l l i ons )
9/27/14
Cash
Cap.
(%)
Cumulative
Cons. EBITDA
Multiple
Amount /
Multiple (x)
$40.9
$60 million Revolver (1)
Term Loan B(1)
Sr. Notes (2)
Other
Total Debt
Equity (Book Value)
Total Capitalization
–
110.1
200.0
0.1
$310.2
257.6
$567.8
Net Debt
$269.3
–
19.4%
35.2%
–
54.6%
45.4%
100.0%
–
1.3x
3.7x
3.7x
3.7x
LTM Q3 2014 Consolidated EBITDA(3)
LTM Q3 2014 Capital Expenditures
LTM Q3 2014 Interest Expense
Consolidated EBITDA / Interest Expense
(Consolidated EBITDA – CapEx) / Interest Exp.
3.2x
Notes:
(1) Sr. credit facility terms are L+3.75%, with a 1.00% LIBOR floor. Revolver unused at 9/27/14.
(2) Sr. Notes issued at 9.75% due 2018; first callable on 7/15/15 at 104.875
(3) See reconciliation of net income to Consolidated EBITDA in appendix.
20
We expect to pay down $30M of debt annually
$83.1
14.4
28.3
2.9x
2.4x
Sound Strategies for Profitable Growth
• Customer focused both internal and externally
• Leverage “One Ducommun” platform
• Execute on market demand to deliver more
integrated solutions
• Accelerate organizational development to
support growth
• Drive cash flow
21
Ducommun’s Focus
• Business development
– Provide a compelling value proposition as an innovative
solutions provider
• Strengthen balance sheet further
– Pay down debt, reduce interest expense
• Expand margins through improved efficiencies
– Adapt organizational structure to ensure operations and support
functions are in sync
– Drive operational excellence through lean, quality and supply
chain initiatives
• Develop our people
– Support our workforce to become more nimble and able to
respond to change more quickly
22
Why Invest in Ducommun?
• Well positioned in large growing markets for both A&D and
other key technology-driven applications
• Well organized to take advantage of key growth drivers
– Steady growth in commercial aircraft build rates for large
commercial aircraft for Boeing and Airbus
– Customers are increasingly using more integrated electronic
content on their platforms
– Solid, profitable market diversification
– Customers consolidating supply base to companies with expanding
capabilities
• Solid backlogs
• Consistently strong cash flows
23
Appendix
24
Ducommun’s Facilities Locations
Ducommun AeroStructures (DAS)
Ducommun LaBarge Technologies (DLT)
Miltec
Thailand
25
Primarily U.S.-based with access to low-cost domiciles
Ducommun Headquarters
Consolidated EBITDA Reconciliation
For the Twelve Months Ended 9/27/14
($ in thousands)
Net income
Depreciation and amortization
Interest expense, net
Income tax provision
Stock-based compensation
Asset impairment
Insurance proceeds
Other (1)
Consolidated EBITDA
$
$
9,219
31,380
28,344
5,209
3,247
6,975
(1,600)
321
83,095
(1) Incl udes i nteres t for the La Ba rge Ma na gement Reti rement Sa vi ngs Pl a n a nd
La Ba rge Ma na gement Deferred Compens a ti on Pl a n.
26
Ducommun: History of Successful Acquisitions
• Founded in 1849
1849
• May 2001:
Acquisition of
Composite
Structures
1946
• Went public in
1946
27
2001
• August 2003:
Acquisition of
DBP Microwave
2003
2005
• May 2006:
Acquisition of
WiseWave
Technologies
2006
• January 2006:
Acquisition of
Miltec Corporation
2007
• December 2008:
Acquisition of
DynaBil Industries
2008
• September 2006:
Acquisition of
CMP Display
Systems
Ducommun has a history of successful integration and
deleveraging post acquisition
2011
• June 2011:
Acquisition of
LaBarge
Goal Deployment Process (GDP) Flow and X-Matrix
Review site KPIs and continual
improvement actions with
applicable team members.
Site Goals
Define and
standardize Key
Performance
Indicators (KPI) and
their goals.
KPI
AOP
LRP
Use site tracking center and 3-up charts
to trend KPI performance, identify key
drivers and track continual
improvement actions.
28
GDP links goals from LRP to individual performance plans
Established 1849
29