ANNUAL REPORT 2016 Executives 11 Board of Directors 12 Board of Advisors 14 Corporate Overview & Background

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  • ANNUAL REPORT 2016

  • Annual Report 2016

    1

    A LETTER FROM THE CEO

    This past year, like nearly every year before, has brought tremendous growth to MAG. Once again we nearly doubled the size of our company in just twelve months. We owe this growth to every one of our dedicated professionals worldwide. Like any growth, it came with pain. MAG professionals have deployed to every continent in 2016, working existing contracts while standing up new programs in some of the most challenging places in the world. Meanwhile, our corporate staff has worked tirelessly to ensure that the company runs smoothly and our forward deployed professionals get the support they need. I am humbled by the professionalism and commitment of our team members every day.

    The accomplishments of 2016 are staggering. We fl ew over 68,000 hours with 140+ platforms on 5 continents. We strengthened existing customer relationships and expanded the scope of current contracts. We won new contracts in the Pacifi c and launched our Australia offi ce. We integrated our most recent acquisition and consolidated our brand to MAG Aerospace. We nearly doubled in revenue and number of employees. Everywhere I traveled, MAG was the company everyone talked about. And the message was clear: we perform, no matter how diffi cult the task.

    2016 saw MAG truly make the world smaller and safer. We continue to punch well above our weight, making contributions to the world that would be the envy of much larger companies. 2017 holds even more promise, with new contracts, new customers, and new members to the MAG family. This report looks back, but at MAG we always focus on the task ahead as we serve, win, and perform all over the world.

    Sincerely,

    Joseph E. Fluet

    With 900+ employees serving the needs of military, international, civilian, and commercial customers around the world, the sun never sets on MAG.

  • Annual Report 2016

    3

    Company Snapshot 4 Summary 4 Key Facts 5 2016 Initiatives and Accomplishments 5 2016 Signifi cant Wins 5 Locations and Services 6 ISR Operations 7 ISR Training 7 ISR Technical Services 7 Other 7 Employee Breakdown 8 2016 Awards and Recognitions 9

    Our Leadership Team 10 Executives 11 Board of Directors 12 Board of Advisors 14

    Corporate Overview & Background 16 Services 17 Customer Diversifi cation 18 Contract Diversifi cation 19 Worldwide Footprint 20 Corporate Overview & Background 20 Operational Key Performance Indicators 20 MAG Employees Making an Impact 21 Our Growth 22 Worldwide Business Development Network/Footprint 23 Forward Revenue Strategy 23

    Financial Statements & Supplementary Data 23

    T A B

    L E O

    F C

    O N

    T E N

    T S

  • Annual Report 2016

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    AEROSPACE

    A COMPANY SNAPSHOT - 5

    C O

    M P A N

    Y S

    N A P S

    H O

    T Key Facts Began Operations:: 2010 Headquarters: Woodbridge, VA

    Employees: Over 900+ experts providing full spectrum ISR capabilities (operations, training, and technical services) and other specialty aviation services worldwide.

    Strong Revenue Growth: $153M in 2016 (110% Increase in Revenue from 2015)

    2016 Flight Hours Fixed Wing: 30,625

    Rotary Wing: 13,930

    UAV: 24,370

    Total Flight Hours: 68,925

    2016 Initiatives and Accomplishments

    ● Established Safety Management System (SMS) to provide risk mitigation oversight of our worldwide fl ight operations.

    ● Successfully captured the prime position on the SOUTHCOM C4ISR contract

    ● MARSS Pilot Contract: achieved program steady state, increased fl ight hour operational tempo by 25% resulting in an average of over 3,000 fl ight hours per month, seamlessly integrated SS-AISR contract into existing fl ight operations (MAG combined aircrews)

    ● Increased footprint in Pacifi c market: Philippines Super Swiper SUAS sale, launched MAG Australia, Malaysia Royal Police Maritime Patrol mission training, Foreign Fisheries Agency (FFA) study completed, Seychelles awarded & executed

    ● Established a Corporate Compliance Department that manages all international trade procedures across the MAG enterprise to include MAG’s subsidiary entities, and manages all Defense Security Service (DSS) compliance requirements

    ● Company Re-Org: Agile business units structured for high contract performance organic growth, and competitive rates.

    2016 Signifi cant Wins

    SS-AISR

    MAG is providing operations management for aerial ISR aircraft and sensor platforms and logistics support.

    RQ-170 Mission Planning

    MAG is providing ISR operational support, mission planning, training and test and evaluation support to Air Force bases within the continental United States.

    INSCOM B300

    MAG is providing Aerial ISR fl ight operations, pilot support, and Airborne Sensor Operators for aircraft operating overseas and within the continental United States.

    25th AF IDIQ

    MAG is providing actionable, multi-discipline intelligence derived from multiple ISR platforms to Combatant Commands (COCOMs), Component Numbered Air Forces (C-NAF) and national command authorities across the globe, 24/7.

    FBI MAG is building a web collaboration tool for the FBI.

    TUAS Shadow

    MAG is providing RQ-7 Shadow Unmanned Aerial Systems (UAS) operators and maintainers to the US Army.

    JTAC | CAS

    MAG is providing pre- deployment reconnaissance and close-air support training and services to diff erent special teams.

    Summary MAG Aerospace is an industry leader in providing and enabling global situational awareness to help our customers make the world smaller and safer.

    In 2016, MAG’s team of 900+ professionals operated 140+ manned and unmanned special mission aircraft during more than 68,000 fl ight hours on 5 continents in support of our customers’ missions. MAG’s world class tactical-technical-intelligence experts fl awlessly executed manned and unmanned Intelligence, Surveillance, and Reconnaissance (ISR) operations, aviation training, and technical services to military, international, civilian, and commercial customers worldwide. Because of this, MAG has developed outstanding relationships with a diverse set of highly sought after customers and gained a proven record of past performance around the globe. Now entering our 7th year, MAG is one of the fastest growing companies in the aerospace and defense industry, with three years of consecutive near 100% growth and signifi cant forward revenue visibility. Led by an executive team with demonstrated prowess in achieving and managing explosive organic and inorganic growth, MAG looks forward to continued success in 2017 and beyond.

    4 - A COMPANY SNAPSHOT

  • USA (15 locations)

    Virginia, USA Canada

    Kosovo SW Asia (11 locations)

    Afghanistan

    Djibouti

    Seychelles

    Philippines

    Democratic Republic of the Congo

    Malaysia Solomon Islands

    UK

    Uganda

    Central America, South America, Caribbean

    AEROSPACE Annual Report 2016

    7A COMPANY SNAPSHOT - 766 - A COMPANY SNAPSHOT

    Locations and Services Manned ISR Operations

    Operate and maintain multi-mission manned airborne ISR platforms with complex mission systems

    Unmanned ISR Operations

    Operate, maintain, and evaluate all sizes of Unmanned Aircraft Systems

    Manned ISR Training

    Provide training for fixed wing aircraft ISR operations

    Unmanned ISR Training

    Provide training for Unmanned Aircraft Systems ISR operations

    C2 Systems & Operations

    Operate, maintain, manage, and evaluate Command & Control and ISR network systems

    Data Dissemination/GIS

    Provide video, network, geospatial, and software engineering solutions, simulation, and assessments

    Other Specialty Aviation

    Provide training and logistics support for non- standard aviation operations

    Manned ISR

    Operations

    Other Specialty Aviation

    Manned ISR

    Training

    C2 Systems &

    Operations

    Data Dissemination

    / GIS

    Unmanned ISR

    Operations

    Unmanned ISR

    Training

    ISR Operations

    ISR Training

    ISR Technical Services

    Other

  • Annual Report 2016

    8 9

    AEROSPACE

    8 - A COMPANY SNAPSHOT A COMPANY SNAPSHOT - 9

    Tech Services (224)

    Tier 3 Employees (32)

    ISR (130)

    Corporate (41) Global Ops

    (481)

    TOTAL 908

    31% Mission Systems Operators

    42% Secret

    34% Top Secret

    6% Maintainers

    9% Corporate

    54% Middle East

    23% United States

    11% Other North America

    27% Masters Degree

    1% Doctorate

    17% Skilled

    89% Co-located with Customer

    31% Pilots

    41% Bachelors

    3% None 11%

    Working at MAG Facilities

    21% TS-SCI

    8% Subject Matter Experts

    15% Overhead

    2% Africa

    7% South America

    3% Europe

    14% Associates

    MAG workforce can be found all across the globe

    MAG workforce is experienced and educated

    97% of the MAG workforce holds a security clearance

    Most of MAG employees work alongside our customers

    MAG workforce provides a skilled team