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United States
Securities and Exchange Commission
Washington, D.C. 20549

FORM 10-Q

Commission File Number: 1-12235

TRIUMPH GROUP, INC.
(Exact name of registrant as specified in its charter)

        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 periods that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ý    No o

        Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date.

        Common Stock, par value $0.001 per share, 15,854,064 shares as of January 24, 2003.

TRIUMPH GROUP, INC.

INDEX

Part I. Financial Information

Item: 1. Financial Statements

Triumph Group, Inc.

Consolidated Balance Sheets

(dollars in thousands, except per share data)

1

Triumph Group, Inc.

Consolidated Balance Sheets (continued)

(dollars in thousands, except per share data)

SEE ACCOMPANYING NOTES.

2

Triumph Group, Inc.

Consolidated Statements of Income

(in thousands, except per share data)

(unaudited)

SEE ACCOMPANYING NOTES.

3

Triumph Group, Inc.

Consolidated Statements of Cash Flows

(dollars in thousands)

(unaudited)

4

Triumph Group, Inc.

Consolidated Statements of Cash Flows (continued)

(dollars in thousands)

(unaudited)

SEE ACCOMPANYING NOTES.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(dollars in thousands, except per share data)

(Unaudited)

1. BASIS OF PRESENTATION

        The accompanying unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine-month periods ended December 31, 2002 are not necessarily indicative of the results that may be expected for the fiscal year ended March 31, 2003. For further information, refer to the consolidated financial statements and footnotes thereto included in Triumph Group, Inc.'s (the "Company") Annual Report on Form 10-K for the year ended March 31, 2002.

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

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION

        The Company's Aviation segment designs, engineers, manufactures or repairs and overhauls aircraft components and industrial gas turbine components and accessories for commercial airlines, air cargo carriers, and original equipment manufacturers of aircraft and aircraft components and power generation equipment on a worldwide basis. The Company's Metals segment manufactures, machines, processes, and distributes metal products to customers in the computer, construction, container and office furniture industries, primarily within North America.

USE OF ESTIMATES

        The preparation of the 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.

USE OF DERIVATIVE FINANCIAL INSTRUMENTS

        The Company periodically uses derivative financial instruments principally to manage the risk that changes in interest rates will affect the amount of its future interest payments. The Company had entered into an interest rate swap contract which effectively converted a portion of its floating-rate debt to a fixed-rate basis through November 2002. Under the interest rate swap contract, the Company paid amounts equal to the specified fixed-rate interest (6.56%) multiplied by the notional principal amount ($100,000), and received a floating-rate interest (30-day LIBOR) multiplied by the same notional principal amount. The net effect of the spread between the floating rate and the fixed rate is reflected as an adjustment to interest expense in the period incurred.

        No other cash payments are made unless the contract is terminated prior to maturity, in which case the amount paid or received in settlement is established by agreement at the time of termination and should represent the market quotation, at current rates of interest, of the remaining obligations to

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exchange payments under the terms of the contract. The Company accounted for its interest rate swap contract as a cash flow hedge which was highly effective. At March 31, 2002, the interest rate swap is reflected at fair value of $3,115 and is included in accrued expenses and other. The Company's interest rate swap terminated in November 2002. The Company did not experience any ineffectiveness with its interest rate swap and, accordingly, did not recognize any gains or losses in its earnings.

INTANGIBLE ASSETS

        Intangible assets cost and accumulated amortization at December 31, 2002 were $48,619 and $16,558 respectively. Intangible assets cost and accumulated amortization at March 31, 2002 were $48,219 and $13,272, respectively. Intangible assets consist of two major classes: (i) product rights and licenses and (ii) non-compete agreements and other. Gross cost and accumulated amortization of product rights and licenses at December 31, 2002 were $37,108 and $9,816 respectively, and at March 31, 2002 were $36,708 and $7,136, respectively. Gross cost and accumulated amortization of noncompete agreements and other at December 31, 2002 were $11,511 and $6,742, respectively, and at March 31, 2002 were $11,511 and $6,136, respectively. Amortization expense for the three and nine-month periods ended December 31, 2002 were $1,125 and $3,286 respectively. Amortization expense for the fiscal year ending March 31, 2003 and the succeeding five fiscal years by year is expected to be as follows: 2003: $4,411; 2004: $4,500; 2005: $4,500; 2006: $4,500; 2007: $3,673; 2008: $3,343.

3. ACQUISITIONS

        In April 2002, the Company acquired certain assets of Ozone Industries, Inc. ("Ozone Assets"), which are being operated by the Company's subsidiary, HTD Aerospace, Inc. In July 2002, the Company acquired substantially all of the assets of Aerocell Structures, Inc. ("Aerocell Assets"), which are being operated by the Company's subsidiary, Airborne Nacelle Services, Inc. In August 2002, the Company acquired substantially all of the assets of Furst Aircraft and Instrument ("Furst") which are being operated by the Company's subsidiary, Furst Aircraft, Inc. The Company acquired the Ozone Assets to expand its product line offerings in hydraulic control systems, the Aerocell Assets to expand its capabilities and customer base in repair of flight control surfaces, and Furst to expand its capabilities and customer base in instrument repair. The Ozone Assets are used in conjunction with the design, development, testing and manufacturing of aircraft hydraulic systems and components for the defense and commercial aircraft markets. These proprietary products include nose wheel steering assemblies and hydraulic quick disconnect couplings. The Aerocell Assets are used in the repair and overhaul of airframe components, bonded components and structural assemblies for all commercial air fleets. Furst operates within the business jet market as a certified instrument repair, overhaul and re-certification facility and has capabilities on more than 1,500 components and represents most major manufacturers. In addition, Furst provides avionics installation services, rotables, loaners, engineering, 24-hour AOG support, inventory and parts management and field services. The purchase price of the combined asset purchases of $28,558 includes cash paid at the closings, direct costs of the transactions and deferred payments. The excess of the purchase price over the preliminary estimated fair value of the net assets acquired of $4,764 was recorded as goodwill.

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        In November 2002, the Company acquired the remaining four percent of the stock of its subsidiary, Triumph Controls, Inc. The purchase price of $3,425, net of the minority interest liability, was recorded as goodwill.

        These acquisitions have been accounted for under the purchase method and, accordingly, are included in the consolidated financial statements from their dates of acquisition. These acquisitions were funded by the Company's long-term borrowings in place at the date of each respective acquisition.

        The following unaudited pro forma information for the nine months ended December 31, 2002 and 2001 have been prepared assuming the acquisition of the Ozone Assets, the Aerocell Assets and Furst had occurred on April 1, 2001. The pro forma information for the nine months ended December 31, 2002 is as follows: Net sales: $451,754; Net income: $27,474; Earnings per share—basic: $1.74; and Earnings per share—diluted: $1.72. The pro forma information for the nine months ended December 31, 2001 is as follows: Net sales: $492,754; Net income: $34,026; Earnings per share—basic: $2.16; and Earnings per share—diluted: $2.14. The unaudited pro forma information includes adjustments for interest expense that would have been incurred to finance the purchases and additional depreciation based on the estimated fair market value of the property and equipment acquired. The unaudited pro forma financial information is not necessarily indicative of the results of operations as they would have been had the transactions been effected on the assumed dates.

4. INVENTORIES

        The components of inventories are as follows:

5. LONG-TERM DEBT

        Long-term debt consists of the following:

        In November 2002, the Company retired all of the outstanding industrial revenue bonds ("Bonds") totaling $7,500, plus accrued interest. The retirement of the Bonds was funded by borrowings under the Company's revolving credit facility ("Credit Facility").

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5. LONG-TERM DEBT (Continued)

        In November 2002, the Company retired $11,180 of the subordinated promissory notes and $674 of junior subordinated promissory notes, which were included in other debt. The retirement of the subordinated promissory notes and junior subordinated promissory notes were funded by borrowings under the Company's Credit Facility.

        In December 2002, the Company issued two classes of Senior Notes: $80,000 of Class A notes and $70,000 of Class B notes. Class A notes carry a fixed rate of interest of 6.06% and mature on December 2, 2012. Class B notes carry a fixed rate of interest of 5.59% and mature in seven annual installments of $10,000 starting on December 2, 2006 through December 2, 2012. The proceeds of the Senior Notes were used to pay down the Credit Facility.

        In conjunction with the issuance of the Senior Notes, the Company amended its Credit Facility to reduce the credit limit from $350,000 to $250,000, extend the expiration date thereof from June 13, 2004 to December 13, 2006 and amend certain terms and covenants. The Credit Facility bears interest at either LIBOR plus between 1.0% and 2.0% or the prime rate (or the Federal Funds rate plus 0.5% if greater) or an overnight interest rate at the option of the Company. The variation in the 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 0.2% and 0.4% on the unused portion of the Credit Facility.

6. EARNINGS PER SHARE

        The following is a reconciliation between the weighted average outstanding shares used in the calculation of basic and diluted earnings per share:

        Options to purchase 548,500 shares of common stock, at prices ranging from $31.38 per share to $44.91 per share, were outstanding during the three months ended December 31, 2002. These options were not included in the computation of diluted earnings per share because the exercise price was greater than the average market price of the common stock during the three months ended December 31, 2002 and, therefore, the effect would be antidilutive.

7. COMMON STOCK

        During the quarter ended June 30, 2002, all 1,848,535 shares of Class D Common stock outstanding were converted to Common stock.

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8. SEGMENT REPORTING

        Selected financial information for each reportable segment is as follows:

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        For the three months ended December 31, 2002 and 2001, the Company had foreign sales of $27,991 and $35,710, respectively. For the nine months ended December 31, 2002 and 2001, the Company had foreign sales of $86,755 and $102,567, respectively.

9. SUBSEQUENT EVENT

        In January 2003, the Company acquired substantially all of the assets of The Boeing Company's Spokane Fabrication Operation, located in Spokane, Washington. The acquired business, which was renamed Triumph Composite Systems, Inc., adds new products and new capabilities to the Company's portfolio of Structural Component products and services. Triumph Composite Systems is dedicated to the production of aircraft parts made of composite and thermoplastic materials. Primary products include floor panels, air control system ducts and nonstructural composite flight deck components. As part of the transaction, the Company and The Boeing Company have entered into an eight-year single-source supply agreement for the products currently produced by Triumph Composite Systems. The purchase price which was paid in cash at closing for this acquisition of approximately $42,200 was funded by borrowings under the Company's Credit Facility.

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Item 2. 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 contained elsewhere herein.)

Three months ended December 31, 2002 compared to three months ended December 31, 2001

Aviation Segment

        Net sales.    Net sales for the Aviation segment decreased by $5.9 million, or 4.3%, to $132.6 million for the third quarter of fiscal 2003 from $138.5 million for the prior year period. This decline in revenue is primarily due to a decrease in commercial airframe build rates as compared to the prior year period, partially offset by certain military programs, most significantly the CH 47 and F-18 E/F programs. Revenue in the third quarter of fiscal 2003 was also assisted by the positive impact from the acquisitions of certain assets of Ozone Industries, Inc. in April 2002, certain assets of Aerocell Structures, Inc. in July 2002 and the acquisition of certain assets of Furst Aircraft and Instrument in August 2002 (collectively, the "2003 Acquisitions").

        Costs of products sold.    Costs of products sold for the Aviation segment decreased by $2.7 million, or 2.8%, to $92.6 million for the third quarter of fiscal 2003 from $95.3 million for the third quarter of fiscal 2002. Cost of products sold increased as a percentage of sales primarily due to lower operating rates in relation to fixed costs, as well as significant increases in healthcare costs.

        Gross profit.    Gross profit for the Aviation segment decreased by $3.2 million, or 7.5%, to $39.9 million for the third quarter of fiscal 2003 from $43.2 million for the third quarter of fiscal 2002. This decrease was primarily due to the reasons discussed above. As a percentage of net sales, gross profit for the Aviation segment was 30.1% and 31.2% for the third quarter of fiscal 2003 and fiscal 2002, respectively.

        Selling, general and administrative expenses.    Selling, general and administrative expenses for the Aviation segment increased by 0.1% to $15.5 million for the third quarter of fiscal 2003 from $15.4 million for the prior year period, due to increases in healthcare costs, liability insurance premiums and the inclusion of the 2003 Acquisitions, partially offset by reduced employment costs which resulted from a reduction in headcount.

        Depreciation and amortization.    Depreciation and amortization for the Aviation segment increased by $0.9 million, or 17.1%, to $6.2 million for the third quarter of fiscal 2003 from $5.3 million for the third quarter of fiscal 2002, primarily due to an increase in depreciation as a result of capital expenditures made over the last twelve months and from the assets acquired in connection with the inclusion of the 2003 Acquisitions.

        Operating income.    Operating income for the Aviation segment decreased by $4.2 million, or 18.6%, to $18.3 million for the third quarter of fiscal 2003 from $22.4 million for the prior year period. The net decrease in operating income from the prior year period resulted from the decrease in revenues and gross profits, most notably from the decrease in commercial airframe build rates discussed above, increases in depreciation and amortization expenses from the Aviation segment as a whole, partially offset by the operating profits from the inclusion of the 2003 Acquisitions.

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Metals Segment

        Net sales.    Net sales for the Metals segment remained unchanged at $10.8 million for the third quarter of fiscal 2003 from the prior year period. Improved pricing resulting from a tariff imposed on steel in the Company's electrogalvanized and flat rolled steel products operation was offset by lower activity at the Company's structural steel erection operation.

        Costs of products sold.    Costs of products sold for the Metals segment increased by $0.8 million, or 10.5%, to $8.8 million for the third quarter of fiscal 2003 from $8.0 million for the third quarter of fiscal 2002, which was primarily due to a rise in raw material prices as a result of a tariff imposed on steel. The increased costs resulting from the tariff were only partially passed on to customers, which resulted in a significant decline in gross margins.

        Gross profit.    Gross profit for the Metals segment decreased by $0.9 million, or 30.5%, to $2.0 million for the third quarter of fiscal 2003 from $2.9 million for the third quarter of fiscal 2002, due to the reasons discussed above. As a percentage of net sales, gross profit for the Metals segment was 18.5% and 26.5% for the third quarter of fiscal 2003 and fiscal 2002, respectively.

        Selling, general and administrative expenses.    Selling, general and administrative expenses for the Metals segment decreased by 1.3% to $2.4 million for the third quarter of fiscal 2003 from $2.5 million for the third quarter of fiscal 2002.

        Depreciation and amortization.    Depreciation and amortization for the Metals segment increased by $0.1 million or 30.7%, to $0.5 million for the third quarter of fiscal 2003 from $0.4 million for the third quarter of fiscal 2002.

        Operating loss.    The operating loss for the third quarter of fiscal 2003 was $(0.9) million, a $1.0 million decrease from the prior year same quarter.

Overall Results

        Corporate expenses.    Corporate expenses increased by $0.3 million, or 19.1%, to $2.1 million for the third quarter of fiscal 2003 from $1.8 million for the third quarter of fiscal 2002.

        Interest expense and other.    Interest expense and other decreased by $0.5 million, or 13.5%, to $3.0 million for the third quarter of fiscal 2003 from $3.5 million for the third quarter of fiscal 2002. This decrease was primarily due to lower interest rates, partially offset by increased borrowing resulting from the 2003 Acquisitions and the Company's capital expenditure program.

        Income tax expense.    The effective tax rate was 35.5% for the third quarter of fiscal 2003 and 31.4% for the third quarter of fiscal 2002.

        Net income.    Net income decreased by $3.9 million, or 33.2%, to $7.9 million for the third quarter of fiscal 2003 from $11.8 million for the third quarter of fiscal 2002.

Nine months ended December 31, 2002 compared to nine months ended December 31, 2001

Aviation Segment

        Net sales.    Net sales for the Aviation segment decreased by $14.3 million, or 3.3%, to $413.7 million for the nine months ended December 31, 2002 from $428.0 million for the prior year period. This decline in revenue is primarily due to a decrease in commercial airframe build rates as

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compared to the prior year period, partially offset by certain military programs, most significantly the C-17 and F-18 E/F programs. Revenue in the first nine months of fiscal 2003 was also helped by the positive impact from the acquisition of EFS Aerospace, Inc. ("EFS") in August 2001 and from the inclusion of the 2003 Acquisitions.

        Costs of products sold.    Costs of products sold for the Aviation segment decreased by $2.9 million, or 1.0%, to $290.4 million for the nine months ended December 31, 2002 from $293.3 million for the nine months ended December 31, 2001. Cost of products sold increased as a percentage of sales primarily due to lower operating rates in relation to fixed costs, as well as significant increases in healthcare costs.

        Gross profit.    Gross profit for the Aviation segment decreased by $11.4 million, or 8.5%, to $123.3 million for the nine months ended December 31, 2002 from $134.7 million for the prior year period. This decrease was primarily due to the reasons discussed above. As a percentage of net sales, gross profit for the Aviation segment was 29.8% and 31.5% for the nine months ended December 31, 2002 and 2001, respectively.

        Selling, general and administrative expenses.    Selling, general and administrative expenses for the Aviation segment increased by $0.1 million, or 0.3%, to $46.4 million for the first nine months of fiscal 2003 from $46.3 million for the prior year period, due to increases in healthcare costs, liability insurance premiums as well as the inclusion of EFS and the 2003 Acquisitions, partially offset by a reduction in employment costs which resulted from a reduction in headcount.

        Depreciation and amortization.    Depreciation and amortization for the Aviation segment increased by $2.9 million, or 19.5%, to $17.9 million for the first nine months of fiscal 2003 from $15.0 million for the first nine months of fiscal 2002, primarily due to an increase in depreciation as a result of capital expenditures made over the last twelve months and from the assets acquired in connection with the acquisition of EFS and the 2003 Acquisitions.

        Operating income.    Operating income for the Aviation segment decreased by $14.4 million, or 19.7%, to $58.9 million for the nine months ended December 31, 2002 from $73.4 million for the prior year period. The net decrease in operating income over the prior year period resulted from the decrease in revenues and gross profits, most notably from the decrease in commercial airframe build rates discussed above and increases in depreciation and amortization expenses from the Aviation segment as a whole, partially offset by the operating profits from the inclusion of EFS and the 2003 Acquisitions.

Metals Segment

        Net sales.    Net sales for the Metals segment decreased by $3.1 million, or 8.5%, to $33.2 million for the first nine months of fiscal 2003 from $36.2 million for the prior year period. This decrease was mainly due to lower activity at the Company's structural steel erection operation and lower volume at the Company's electrogalvanized and flat rolled steel products operation caused by lower demand from its durable goods customers, partially offset by price increases resulting from a tariff imposed on steel.

        Costs of products sold.    Costs of products sold for the Metals segment decreased by $2.5 million, or 9.2%, to $25.1 million for the nine months ended December 31, 2002 from $27.7 million for the first nine months of fiscal 2002. This decrease was mainly due to the decrease in activity at the Company's structural steel erection operation and the decrease in activity at the Company's electrogalvanized and flat rolled steel products operation, which was partially offset by a rise in raw material prices due to a

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tariff imposed on steel. The increased costs resulting from the tariff were only partially passed on to customers, which resulted in a significant decline in gross margins.

        Gross profit.    Gross profit for the Metals segment decreased by $0.5 million, or 6.2%, to $8.0 million for the first nine months of fiscal 2003 from $8.6 million for the nine months of fiscal 2002, due to the reasons discussed above. As a percentage of net sales, gross profit for the Metals segment was 24.2% and 23.6% for the nine months ended December 31, 2002 and 2001, respectively.

        Selling, general and administrative expenses.    Selling, general and administrative expenses for the Metals segment decreased by $0.1 million, or 1.1%, to $7.1 million for the nine months of fiscal 2003 from $7.2 million for the nine months of fiscal 2002.

        Depreciation and amortization.    Depreciation and amortization for the Metals segment increased by $0.2 million, or 13.9%, to $1.3 million for the first nine months of fiscal 2003 from $1.1 million for the nine months of fiscal 2002.

        Operating loss.    The operating loss for the nine months of fiscal 2003 was $(0.4) million, a $0.6 million decrease from the prior year period.

Overall Results

        Corporate expenses.    Corporate expenses increased by $0.4 million, or 7.1%, to $5.9 million for the nine months of fiscal 2003 from $5.5 million for the nine months of fiscal 2002.

        Special charge.    During the second quarter of fiscal 2002, the Company recorded a special charge totaling $5.0 million related to the write-off of the design and development costs related to an aircraft program, which was deemed unlikely to go into production.

        Interest expense and other.    Interest expense and other decreased by $0.4 million, or 4.3%, to $9.3 million for the nine months ended December 31, 2002 from $9.7 million for the nine months ended December 31, 2001. This decrease was primarily due to lower interest rates, partially offset by increased borrowing resulting from the acquisition of EFS, the 2003 Acquisitions and the Company's capital expenditure program.

        Income tax expense.    The effective tax rate was 35.5% for the nine months of fiscal 2003 and 34.6% for the nine months of fiscal 2002.

        Net income.    Net income decreased to $28.0 million for the nine months of fiscal 2003 from $34.9 million for the prior year period. The decrease in net income for the nine months of fiscal 2003 was primarily attributable to the reduced earnings of the Aviation segment operating units.

Liquidity and Capital Resources

        The Company's working capital needs are generally funded through cash flows from operations and borrowings under its credit arrangements. The Company generated approximately $38.4 million of cash flows from operating activities for the nine months ended December 31, 2002. The Company used approximately $57.9 million in investing activities and raised approximately $19.4 million from financing activities for the nine months ended December 31, 2002.

        In December 2002, the Company issued two classes of Senior Notes: $80.0 million of Class A notes and $70.0 million of Class B notes. Class A notes carry a fixed rate of interest of 6.06% and mature on December 2, 2012. Class B notes carry a fixed rate of interest of 5.59% and mature in seven

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annual installments of $10.0 million starting on December 2, 2006 through December 2, 2012. The proceeds of the Senior Notes were used to pay down the Company's revolving credit facility ("Credit Facility").

        In conjunction with the issuance of the Senior Notes, the Company amended the Credit Facility to reduce the credit limit from $350.0 million to $250.0 million, extend the expiration date thereof from June 13, 2004 to December 13, 2006 and amend certain terms and covenants. The Credit Facility bears interest at either LIBOR plus between 1.0% and 2.0% or the prime rate (or the Federal Funds rate plus 0.5% if greater) or an overnight interest rate at the option of the Company. The variation in the 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 0.2% and 0.4% on the unused portion of the Credit Facility. As of December 31, 2002, $235.3 million was available under the Credit Facility. On December 31, 2002, an aggregate amount of approximately $8.2 million was outstanding under the Credit Facility, $5.0 million of which was accruing interest at LIBOR plus applicable basis points totaling 2.82% per annum, and $3.2 million of which was accruing interest at the overnight rate of 2.70% per annum. Amounts repaid under the Credit Facility may be reborrowed.

        Capital expenditures were approximately $24.9 million for the nine months ended December 31, 2002 primarily for manufacturing machinery and equipment for the Aviation segment. The Company funded these expenditures through borrowings under the Credit Facility. The Company expects capital expenditures to be approximately $30.0 million for its fiscal year ending March 31, 2003. The expenditures are expected to be used mainly to expand capacity at several facilities.

        In April 2002, the Company acquired certain assets of Ozone Industries, Inc. In July 2002, the Company acquired substantially all of the assets of Aerocell Structures, Inc., located in Hot Springs, Arkansas, which is being operated by the Company's subsidiary, Airborne Nacelle Services, Inc. In August 2002, the Company acquired substantially all of the assets of Furst Aircraft and Instrument, located in Teterboro, New Jersey which is being operated by the Company's subsidiary, Furst Aircraft, Inc. The total cash paid at these closings of approximately $25.8 million was funded by borrowings under the Credit Facility.

        In November 2002, the Company acquired the remaining four percent of the stock of its subsidiary, Triumph Controls, Inc. The cash purchase price paid at closing of $4.0 million was funded by borrowings under the Credit Facility.

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        In January 2003, the Company acquired substantially all of the assets of The Boeing Company's Spokane Fabrication Operation, located in Spokane, Washington. The acquired business, which was renamed Triumph Composite Systems, Inc., adds new products and new capabilities to the Company's portfolio of Structural Component products and services. Triumph Composite Systems is dedicated to the production of aircraft parts made of composite and thermoplastic materials. Primary products include floor panels, air control system ducts and nonstructural composite flight deck components. As part of the transaction, the Company and The Boeing Company have entered into an eight-year single-source supply agreement for the products currently produced by Triumph Composite Systems. The purchase price which was paid in cash at closing for this acquisition of approximately $42.2 million was funded by borrowings under the Credit Facility.

        In November 2002, the Company retired all of the outstanding industrial revenue bonds ("Bonds") totaling $7.5 million, plus accrued interest. The retirement of the Bonds was funded by borrowings under the Credit Facility.

        In November 2002, the Company retired $11.2 million of the subordinated promissory notes and $0.7 million of junior subordinated promissory notes, which were included in other debt. The retirement of the subordinated promissory notes and junior subordinated promissory notes were funded by borrowings under the Credit Facility.

        The expected future cash flows for the next five years for long term debt, leases and other obligations are as follows:

(1)

Included in the Company's balance sheet at December 31, 2002.

(2)

Includes interest component.

        The Company believes that cash generated by operations and borrowings under the Credit Facility will be sufficient to meet anticipated cash requirements for its current operations. However, the Company has a stated policy to grow through acquisition and is continuously evaluating various acquisition opportunities. As a result, the Company currently is 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 the Company on terms favorable to the Company, if at all.

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Critical Accounting Policies

        Accounting policies that management believes are most critical to the Company's financial condition and operating results pertain to the valuation of accounts receivable, inventory and goodwill. Management considered available information and used judgment in developing estimates.

        The Company adopted Statement of Financial Accounting Standards ("SFAS") No. 142 "Goodwill and Intangible Assets" as of April 1, 2001. SFAS No. 142 provides that goodwill and intangible assets with indefinite lives will not be amortized. As such, the Company did not record goodwill amortization in fiscal 2002 or for the three or nine month periods ended December 31, 2002. Rather, the Company performed an impairment test on its net carrying value as of April 1, 2001, its initial test, and February 1, 2002, its annual test, as required by SFAS No. 142. The Company was not required to record an impairment charge based on its test. The test required estimates, assumptions and judgments and results could be materially different if different estimates, assumptions and judgments had been used.

Forward Looking Statements

        This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to the Company's future operations and prospects, including statements that are based on current projections and expectations about the markets in which the Company operates, 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 the Company. 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 the Company's business segments, dependence of certain of the Company's 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 the Company, see risk factors described in the Company's Annual Report on Form 10-K for the year ended March 31, 2002, filed with the SEC in May 2002.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

Market Risk

        The Company's primary exposure to market risk consists of changes in interest rates on borrowings. An increase in interest rates would adversely affect the Company's 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 the Company's ability to pay dividends on its common stock, if permitted to do so under certain of the Company's debt arrangements, including the Company's revolving credit facility. The Company manages exposure to interest rate fluctuations by optimizing the use of fixed and variable rate debt. The information below summarizes the Company's market risks associated with debt obligations and should be read in conjunction with Note 5 of the Company's consolidated financial statements included in this report.

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        The following table presents principal cash flows and the related interest rates. Fixed interest rates disclosed represent the weighted average rate as of December 31, 2002. Variable interest rates disclosed fluctuate with the LIBOR, federal funds rates and other weekly rates and represent the weighted average rate at December 31, 2002.

Expected Years of Maturity

Item 4.    Controls and Procedures

        (a)  Within 90 days prior to the date of this report, the principal executive officer and principal financial officer evaluated the Company's controls and procedures relating to its reporting and disclosure obligations. These officers have concluded that these disclosure controls and procedures are sufficient to provide that (i) material information relating to the Company, including its consolidated subsidiaries, is made known to these officers by other employees of the Company and its consolidated subsidiaries, particularly material information related to the period for which this periodic report is being prepared; and (ii) this information is recorded, processed, summarized, evaluated and reported, as applicable, within the time periods specified in the rules and forms of the Securities and Exchange Commission.

        (b)  There have been no significant changes in the Company's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation.

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TRIUMPH GROUP, INC.

Part

II.     Other Information

Item

1.     Legal Proceedings

        Not applicable

Item

2.     Changes in Securities

        Not applicable

Item

3.     Defaults upon Senior Securities

        Not applicable

Item

4.     Submission of Matters to a Vote of Security Holders

        Not applicable

Item

5.     Other Information

        Not applicable

Item

6.     Exhibits and Reports on Form 8-K

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Signatures

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: February 7, 2003

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Section 302 Certification by President and CEO

        I, Richard C. Ill, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Triumph Group, Inc.;



2.

Based on my knowledge, this quarterly 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 quarterly report;



3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly report;



4.

The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:



a)

designed such disclosure controls and procedures 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 quarterly report is being prepared;



b)

evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and



c)

presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;




5.

The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):



a)

all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and



b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and




6.

The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

22

Section 302 Certification by Senior Vice President and CFO

I, John R. Bartholdson, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Triumph Group, Inc.;

2.

Based on my knowledge, this quarterly 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 quarterly report;

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly report;

4.

The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)

designed such disclosure controls and procedures 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 quarterly report is being prepared;

b)

evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and

c)

presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):

a)

all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.

The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

23

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