We view our name and mark, as well as the Vought and Embee tradenames,trademark as significant to our business as a whole. Our products are protected by a portfolio of patents, trademarks, licenses or other forms of intellectual property that expire at various dates in the future. We continually develop and acquire new intellectual property and consider all of our intellectual property to be valuable. However, based on the broad scope of our product lines, management believes that the loss or expiration of any single intellectual property right would not have a material adverse effect on our results of operations, our financial position, or our business segments. Our policy is to file applications and obtain patents for our new products as appropriate, including product modifications and improvements. While patents generally expire 20 years after the patent application filing date, new patents are issued to us on a regular basis.

While each of our operating companies maintains responsibility for selling and marketing its specific products, we have developed two marketing teams at the groupoperating segment level who are focused on business development and cross-selling our broad capabilities. One team supports the Aerostructures and Aerospaceis dedicated to Systems Groups& Support, and the other the Aftermarket Services Group.team supports Aerospace Structures.  These teams are responsible for selling aerospace structures, systems, integrated assemblies, and repair and overhaul services, reaching across our operating companies, to our OEM, military, airline and air cargo customers. In certain limited cases, we use independent, commission-based representatives to serve our customers' changing needs and the current trends in some of the markets and geographic regions in which we operate.

The two group-level marketing teams operate as the front-end of the selling process, establishing or maintaining relationships, identifying opportunities to leverage our brand, and providing service for our customers. Each individual operating company is responsible for its own technical support, pricing, manufacturing, and product support. Also, within the Aerospace Systems Group,& Support, we have created a group engineering function to provide integrated solutions to meet our customercustomers’ needs by designing systems that integrate the capabilities of our companies.

We have a number of long-term agreements with several of our customers. These agreements generally describe the terms under which the customer may issue purchase orders to buy our products and services during the term of the agreement. These terms typically include a list of the products or repair services customers may purchase, initial pricing, anticipated quantities and, to the extent known, delivery dates. In tracking and reporting our backlog, however, we only include amounts for which we have actual purchase orders with firm delivery dates or contract requirements generally within the next 24 months, which primarily relate to sales to our OEM customer base. Purchase orders issued by our aftermarket customers are usually completed within a short period of time. As a result, our backlog data relates primarily to the OEM customers. The backlog information set forth below does not include the sales that we expect to generate from long-term agreements for which we do not have actual purchase orders with firm delivery dates.

We compete primarily with Tier 1 and Tier 2 aerostructures manufacturers, systems suppliers and component manufacturers, some of which are divisions or subsidiaries of other large companies, in the manufacture of aircraft structures, systems components, subassemblies and detail parts. OEMs are increasingly focusing on assembly and integration activities while outsourcing more manufacturing and, therefore, are less of a competitive force than in previous years.

Competition for the repair and overhaul of aviation components comes from four primary sources, some of whom possess greater financial and other resources than we have:have, and as a result, may be in a better position to handle the current environment: OEMs, major commercial airlines, government support depots, and other independent repair and overhaul companies. Some major commercial airlines continue to own and operate their own service centers, while others have begun to sell or outsource their repair and overhaul services to other aircraft operators or third parties. Large domestic and foreign airlines that provide repair and overhaul services typically provide these services not only for their own aircraft but for other airlines as well. OEMs also maintain service centers which provide repair and overhaul services for the components they manufacture. Many governments maintain aircraft support depots in their military organizations that maintain and repair the aircraft they operate. Other independent service organizations also compete for the repair and overhaul business of other users of aircraft components.

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Participants in the aerospace industry compete primarily on the basis of breadth of technical capabilities, quality, turnaround time, capacity and price.

The aerospace industry is highly regulated in the United States by the FAAFederal Aviation Administration ("FAA") and in other countries by similar agencies. We must be certified by the FAA and, in some cases, by individual OEMs, in order to engineer and service parts and components used in specific aircraft models. If material authorizations or approvals were revoked or suspended, our operations would be adversely affected. New and more stringent government regulations may be adopted, or industry oversight heightened, in the future and these new regulations, if enacted, or any industry oversight, if heightened, may have an adverse impact on us.

We must also satisfy the requirements of our customers, including OEMs, that are subject to FAA regulations, and provide these customers with products and repair services that comply with the government regulations applicable to aircraft components used in commercial flight operations. The FAA regulates commercial flight operations and requires that aircraft components meet its stringent standards. In addition, the FAA requires that various maintenance routines be performed on aircraft components, and we currently satisfy these maintenance standards in our repair and overhaul services. Several of our operating locations are FAA-approvedFAA-certificated repair stations.

Generally, the FAA only grants licensesapprovals for the manufacture or repair of a specific aircraft component, rather than the broader licensesapprovals that have been granted in the past. The FAA licensingapproval process may be costly and time-consuming. In order to obtain an FAA license,Air Agency Certificate, an applicant must satisfy all applicable regulations of the FAA governing repair stations. These regulations require that an applicant have experienced personnel, inspection systems, suitable facilities and equipment. In addition, the applicant must demonstrate a need for the license. Because ancertificate. An applicant must procure manufacturing andmanufacturer’s repair manuals from third partiesdesign approval holders relating to each particular aircraft component in order to obtain a license with respect to that component,component.   Because of these regulatory requirements, the application process may involve substantial cost.

The license approvalcertification processes for the European Aviation Safety Agency ("EASA"), which regulates this industry in the European Union,Union; the Civil Aviation Administration of China,China; and other comparable foreign regulatory authorities are similarly stringent, involving potentially lengthy audits. EASA was formed in 2002 and is handling most of the responsibilities of the national aviation authorities in Europe, such as the United Kingdom Civil Aviation Authority.

Our business, operations and facilities are subject to numerous stringent federal, state, local and foreign environmental laws and regulationregulations by government agencies, including the Environmental Protection Agency ("EPA"). Among other matters, these regulatory authorities impose requirements that regulate the emission, discharge, generation, management, transportation and disposal of hazardous materials, pollutants and contaminants,contaminants; govern public and private response actions to hazardous or regulated substances which may be or have been released to the environment,environment; and require us to obtain and maintain licenses and permits in connection with our operations. This extensive regulatory framework imposes significant compliance burdens and risks on us. Although management believes that our operations and our facilities are in material compliance with such laws and regulations, future changes in these laws, regulations, or interpretations thereof or the nature of our operations or regulatory enforcement actions which may arise, may require us to make significant additional capital expenditures to ensure ongoing compliance or engage in the future.

As of March 31, 2016,2020, we employed 14,6029,989 persons, of whom 3,4652,105 were management employees, 125104 were sales and marketing personnel, 7821,249 were technical personnel, 889452 were administrative personnel and 9,3416,079 were production workers. Our segments were composed of the following employees: Aerostructures GroupSystems & Support - 9,5953,826 persons, Aerospace Systems GroupStructures - 3,567 persons, Aftermarket Services Group - 1,3116,022 persons, and Corporate - 129141 persons.

Several of our subsidiaries are parties to collective bargaining agreements with labor unions. Under those agreements, we currently employ approximately 1,9071,811 full-time employees. Currently, approximately 13%18% of our permanent employees are represented by labor unions and approximately 51%62% of net sales are derived from the facilities at which at least some employees are unionized. The collective bargaining agreement with our union employees with International Association of Machinists and Aerospace Workers ("IAM") District 751 at our Spokane, Washington facility has expired. As of May 11, 2016, the workforce in Spokane of approximately 400 employees has elected to strike. While we are currently in negotiations with the workforce, we have implemented plans to continue production in Spokane with support from other locations. Of the 1,9071,811 employees represented by unions, 591no employees are working under contracts that have expired or will expire within oneexpired.

During the fiscal year ended March 31, 2019, the Stuart, Florida facility production and 475maintenance employees elected the United Autoworkers of America, Local #2505, to represent them in our Red Oak, Texascollective bargaining with the Company.  As of March 31, 2020, the union and 386 employees in our Tulsa, Oklahoma facilitiesthe Company have not yet negotiated initial contracts. reached an agreement.

Our inability to negotiate an acceptable contract with any of theseour labor unions could result in strikes by the affected workers and increased operating costs as a result of higher wages or benefits paid to union members. If the unionized workers were to engage in a strike or other work stoppage, or other employees were to become unionized, we could experience a significant disruption of our operations and higher ongoing labor costs, which could have an adverse effect on our business and results of operations.

James F. McCabe, Jr. has been our Senior Vice President and Chief Financial Officer since February 2014.August 2016. He joined the Company from Steel Partners Holdings where he served in a number of roles from 2007 to 2016, including the following: Senior Vice President and CFO, President, Shared Services, and Senior Vice President and CFO of its affiliates Handy & Harman and Steel Excel. Prior to joining Steel Partners Holdings, Mr. McRae was named President of Triumph Aerostructures – Vought Aircraft Division in October 2013, having previouslyMcCabe served as Vice President, Finance and Treasurer of Triumph Aerostructures – Vought Integrated Programs DivisionAmerican Water’s Northeast Region from 2004 to 2007, and Chief Financial Officer for Triumph Aerostructures – Vought Aircraft Division,President and CFO of Teleflex Aerospace from 1991 to 2003, which served the global aviation industry. He has previously qualified as a position he had assumed upon the completion of Triumph’s acquisition of Vought Aircraft Industries, Inc. in June 2010. Prior to the acquisition, Mr. McRae hadcertified public accountant and Six Sigma Green Belt and served as Vought’s Vice Presidenta member of Business Operations,the Board of Governors and had been employed by the Company since 2007.

Lance R. Turner was appointed our Senior Vice President and Chief Human Resources Officer in September 2017. From 20012013 until he joined us,September 2017, Mr. Wright was a partner with the law firmTurner served as Vice President of Ballard Spahr LLP, where he practiced corporateHuman Resources for CenturyLink, Inc.; and securities law.

A substantial percentage of our gross profit and operating income derivesresults derive from commercial aviation. Our operations have been focused on designing, engineering, manufacturing, repairing and overhauling a broad portfolio of aerostructures, aircraft components, accessories, subassemblies and systems. Therefore, our business is directly affected by economic factors and other trends that affect our customers in the aerospace industry, including a possible decrease in outsourcing by OEMs and aircraft operators or projected market growth that may not materialize or be sustainable. We are also significantly dependent on sales to the commercial aerospace market, which has been cyclical in nature with significant downturns in the past. When these economic and other factors adversely affect the aerospace industry, they tend to reduce the overall customer demand for our products and services, which decreases our operating income. Economic and other factors that might affect the aerospace industry may have an adverse impact on our results of operations and liquidity. We have credit exposure to a number of

In addition, demand for our maintenance, repair and overhaul services is strongly correlated with worldwide flying activity. A significant portion of the MRO activity required on commercial aircraft is mandated by government regulations that limit the total time or number of flights that may elapse between scheduled MRO events. As a result, although short-term deferrals are possible, MRO activity is ultimately required to continue to operate the aircraft in revenue-producing service. Therefore, over the intermediate and long-term,long term, trends in the MRO market are closely related to the size and utilization level of the worldwide aircraft fleet, as reflected by the number of available seat miles, commonly referred to as ASMs, and cargo miles flown. Consequently, conditions or events which contribute to declines in worldwide ASMs and cargo miles flown, such as those mentioned above, could negatively impact our MRO business.

Our overall operating results arebusiness could be negatively affected by many factors,cyber or other security threats or other disruptions.

Our businesses depend heavily on information technology and computerized systems to communicate and operate effectively. The Company's systems and technologies, or those of third parties on which we rely, could fail or become unreliable due to equipment failures, software viruses, cyber threats, terrorist acts, natural disasters, power failures or other causes. These threats arise in some cases as a result of our role as a defense contractor. Our customers, including the timing of orders from large customersU.S. Government, are increasingly requiring cybersecurity protections and the timing of expenditures to manufacture parts and purchase inventorymandating cybersecurity standards in anticipation of future sales ofour products, and services. A large portionwe may incur additional cost to comply with such demands.

Cybersecurity threats are evolving and include, but are not limited to, malicious software; attempts to gain unauthorized access to our sensitive information, including that of our operating expenses are relatively fixed. Because severalcustomers, suppliers, subcontractors, and joint venture partners; and other electronic security breaches that could lead to disruptions in mission critical systems, unauthorized release of our operating locations typically doconfidential or otherwise protected information and corruption of data.

Although we utilize various procedures and controls to monitor and mitigate these threats, there can be no assurance that these procedures and controls will be sufficient to prevent security threats from materializing. If any of these events were to materialize, the costs related to cyber or other security threats or disruptions may not obtain long-term purchase ordersbe fully insured or commitments from our customers, they must anticipate the future volume of orders based upon the historic purchasing patterns of customersindemnified and upon our discussions with customers as to their anticipated future requirements. These historic patterns may be disrupted by many factors, including changing economic conditions, inventory adjustments, or work stoppages or labor disruptions at our customers' locations. Cancellations, reductions or delays in orders by a customer or group of customers could have a material adverse effect on our business,reputation, operating results and financial condition and results of operations.

The terms of our indentures governing our Senior Notes, Amended Credit Agreement and Securitization Facility (each as defined in Note 10 impose significant operating and financial restrictions on us, which limit our ability to incur liens, sell assets and enter into certain transactions, among other things.  In addition, our debt documents require us to comply with various financial and other covenants set forth in the related agreement, and our Amended Credit Agreement requires us to maintain certain financial ratios, including an interest coverage ratio, a senior secured leverage ratio covenant, and a first lien secured leverage ratio.  We are in compliance with all of our debt covenants. 

We cannot assure you that we will be able to consummate acquisitions on satisfactory termsmaintain compliance with the covenants in the agreements governing our indebtedness in the future or, if we fail to do so, that we will be able to obtain waivers from the holders of such indebtedness or amend the covenants and other terms of the agreements governing such indebtedness on commercially reasonable terms, if at all. Failure to maintain compliance with these covenants may allow the holders of such indebtedness to require immediate repayment of the indebtedness owed to them and to terminate any acquisitions are consummated, successfully integrate these acquired businesses.

We may periodically need to obtain additional financing in order to meet our debt obligations as they come due, to support our operations and/or Boeing Commercial, Militaryto make acquisitions. Our access to the debt capital markets and Space, represented approximately 38%the cost of borrowings are affected by a number of factors, including market conditions and the strength of our net sales forcredit ratings and the fiscal year ended March 31, 2016, covering virtually every Boeing plantimpact of COVID-19 on our markets.  If we cannot obtain adequate sources of credit on favorable terms, or at all, our business, operating results, and product. Gulfstream represented approximately 12%financial condition could be adversely affected. We may also seek transactions to extend the maturity of our net sales for the fiscal year ended March 31, 2016, covering several Gulfstream plantsdebt, reduce leverage or obtain covenant flexibility. Such transactions could result in us incurring additional secured debt or equity and products. As a result, a significant reductionthere can be no assurance that we will be successful in purchases by Boeing and/or Gulfstream could have a material adverse impact on our financial position, results of operations, and cash flows. In addition, some of our other group companies rely significantly on particular customers, the loss of which could have an adverse effect on those businesses.

For certain of our new development programs, we regularly commence work or incorporate customer-requested changes prior to negotiating pricing terms for engineering work or the product which has been modified. We typically have the legal right to negotiate pricing for customer-directed changes. In those cases, we assert to our customers our contractual rights to obtain the additional revenue or cost reimbursement we expect to receive upon finalizing pricing terms. An expected recovery value of these assertions is incorporated into our contract profitability estimates when applying contract accounting. Our inability to recover these expected values, among other factors, could result in the recognition of a forward loss on these programs or a lower than expected profit margin and could have a material adverse effect on our results of operations.

New programs with new technologies typically carry risks associated with design responsibility, development of new production tools, hiring and training of qualified personnel, increased capital and funding commitments, ability to meet customer specifications, delivery schedules and unique contractual requirements, supplier performance, subcontractor performance, ability of the customer to meet its contractual obligations to us, and our ability to accurately estimate costs associated with such programs. In addition, any new aircraft program may not generate sufficient demand or may experience technological problems or significant delays in the regulatory certification or manufacturing and delivery schedule. If we were unable to perform our obligations under new programs to the customer's satisfaction or manufacture products at our estimated costs, if we were to experience unexpected fluctuations in raw material prices or supplier problems leading to cost overruns, if we were unable to successfully perform under revised design and manufacturing plans or successfully and equitably resolve claims and assertions, or if a new program in which we had made a significant investment was terminated or experienced weak demand, delays or technological problems, our business, financial condition and results of operations could be materially adversely affected. This risk includes the potential for

In order to perform on new programs, we may be required to construct or acquire new facilities requiring additional up-front investment costs. In the case of significant program delays and/or program cancellations, we could be required to bear certain unrecoverable construction and maintenance costs and incur potential impairment charges for the new facilities. Also, we may need to expend additional resources to determine an alternate revenue generating use for the facilities. Likewise, significant delays in the construction or acquisition of a plant site could impact production schedules.

Turmoil in the capital markets may impede our ability to access the capital markets when we would like, or need, to raise capital or may restrict our ability to borrow money on favorable terms. Such market conditions could have an adverse impact on our flexibility

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to react to changing economic and business conditions and on our ability to fund our operations and capital expenditures in the future. In addition, interest rate fluctuations, financial market volatility, or credit market disruptions may also negatively affect our customers' and our suppliers' ability to obtain credit to finance their businesses on acceptable terms. As a result, our customers' need for and ability to purchase our products or services may decrease, and our suppliers may increase their prices, reduce their output or change their terms of sale. If our customers' or suppliers' operating and financial performance deteriorates, or if they are unable to make scheduled payments or obtain credit, our customers may not be able to pay, or may delay payment of, accounts receivable owed to us, and our suppliers may restrict credit or impose different payment terms. Any inability of customers to pay us for our products and services or any demands by suppliers for different payment terms may adversely affect our earnings and cash flow.

We must comply with all applicable export control laws and regulations of the United States and other countries. United States laws and regulations applicable to us include the Arms Export Control Act, the International Traffic in Arms Regulations ("ITAR"), the Export Administration Regulations ("EAR") and the trade sanctions laws and regulations administered by the United States Department of the Treasury's Office of Foreign Assets Control ("OFAC"). EAR restricts the export of dual-use products and technical data to certain countries, while ITAR restricts the export of defense products, technical data and defense services. The U.S. Government agencies responsible for administering EAR and ITAR have significant discretion in the interpretation and enforcement of these regulations. We cannot provide services to certain countries subject to United States trade sanctions unless we first obtain the necessary authorizations from OFAC. In addition, we are subject to the Foreign Corrupt Practices Act, which generally bars bribes or unreasonable gifts to foreign governments or officials.

Violations of these laws or regulations could result in significant additional sanctions, including fines, more onerous compliance requirements, more extensive debarments from export privileges, loss of authorizations needed to conduct aspects of our international business and criminal penalties and may harm our ability to enter into contracts with the U.S. Government. A future violation of ITAR or the other regulations enumerated above could materially adversely affect our business, financial condition and results of operations.

Any significant disruption from key suppliers of raw materials and key components could delay production and decrease revenue.

We are highly dependent on the availability of essential raw materials such as carbon fiber, aluminum and titanium, and purchased engineered component parts from our suppliers, many of which are available only from single customer-approved sources. Moreover, we are dependent upon the ability of our suppliers to provide raw materials and components that meet our specifications, quality standards and delivery schedules. Our suppliers' failure to provide expected raw materials or component parts could require us to identify and enter into contracts with alternate suppliers that are acceptable to both us and our customers, which could result in significant delays, expenses, increased costs and management distraction and adversely affect production schedules and contract profitability.

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We have from time to time experienced limited interruptions of supply, and we may experience a significant interruption in the future. Our continued supply of raw materials and component parts are subject to a number of risks, including:

In addition, some contracts with our suppliers for raw materials, component parts and other risks, and our current operations in international markets expose usgoods are short-term contracts, which are subject to such risks.

Due to be, internal growth supplemented by growth through the acquisition of additional aerospace companies and product lines. In order to grow internally,economic difficulty, we may needface pressure to make significant capital expenditures, such as investingrenegotiate agreements resulting in facilities in low-cost countries, andlower margins. Our suppliers may need additional capitaldiscontinue provision of products to do so. Our ability to grow is dependent upon, and may be limited by, among other things, access to markets and conditions of markets, availability under the Credit Facility and the Securitization Facility (each as defined in Note 10 of the "Notes to Consolidated Financial Statements") and by particular restrictions contained in the Credit Facility and our other financing arrangements. In that case, additional funding sources may be needed,us at attractive prices or at all, and we may not be able to obtain such products in the additional capital necessary to pursue our internal growthfuture from these or other providers on the scale and acquisition strategywithin the time periods we require. Furthermore, substitute raw materials or if we can obtain additional financing, the additional financingcomponent parts may not meet the strict specifications and quality standards we and our customers demand, or that the U.S. Government requires. If we are not able to obtain key products on a timely basis and at an affordable cost, or we experience significant delays or interruptions of their supply, revenues from sales of products that use these supplies will decrease. The current impact of COVID-19 could also result in a larger period of time to find suitable replacements.

Significant consolidation by aerospace industry suppliers could adversely affect our business.

The aerospace industry continues to experience consolidation among suppliers and customers, primarily as it pertains to the airlines. Suppliers have consolidated and formed alliances to broaden their product and integrated system offerings and achieve critical mass. This supplier consolidation is in part attributable to aircraft manufacturers more frequently awarding long-term sole-source or preferred supplier contracts to the most capable suppliers, thus reducing the total number of suppliers. This consolidation could cause us to compete against certain competitors with greater financial resources, market penetration and purchasing power. When we purchase component parts and services from suppliers to manufacture our products, consolidation reduces price competition between our suppliers, which could diminish incentives for our suppliers to reduce prices. If this consolidation continues, our operating costs could increase and it may become more difficult for us to be successful in obtaining new customers. COVID-19 has also put considerable pressure on financial terms that are satisfactory to us.

We have numerous competitors in the aerospace industry. We compete primarily with the top-tier systems integrators and the manufacturers that supply them, some of which are divisions or subsidiaries of OEMs and other large companies that manufacture aircraft components and subassemblies. Our OEM competitors, which include Boeing, Airbus, Bell Helicopter, Bombardier, Cessna, General Electric, Gulfstream, Honeywell, Lockheed Martin, Northrop Grumman, Raytheon, Rolls Royce and Sikorsky, may choose not to outsource production of aerostructures or other components due to, among other things, their own direct labor and overhead considerations, capacity utilization at their own facilities, and desire to retain critical or core skills. Consequently, traditional factors affecting competition, such as price and quality of service, may not be significant determinants when OEMs decide whether to produce a part in-house or to outsource. We also face competition from non-OEM component manufacturers, including Alenia Aeronautica, Fokker Technologies, Fuji Heavy Industries, GKN Westland Aerospace (U.K.), Kawasaki Heavy Industries, Mitsubishi Heavy Industries, Spirit AeroSystems and UTC Aerospace Systems. Competition for the repair and overhaul of aviation components comes from three primary sources: OEMs, major commercial airlines and other independent repair and overhaul companies.

The aerospace industry is constantly undergoing development and change and it is likely that new products, equipment and methods of repair and overhaul service will be introduced in the future. In order to keep pace with any new developments, such as additive technology, we may need to expend significant capital to purchase new equipment and machines or to train our employees in the new methods of production and service.

The aerospace industry is highly regulated in the United States by the FAA and in other countries by similar agencies. We must be certified by the FAA and, in some cases, by individual OEMs in order to engineer and service parts, components and aerostructures used in specific aircraft models. If any of our material authorizations or approvals were revoked or suspended, our operations would be adversely affected. New or more stringent governmental regulations may be adopted, or industry oversight heightened in the future, and we may incur significant expenses to comply with any new regulations or any heightened industry oversight.

We continually make significant capital expenditures to implement new processes and to increase both efficiency and capacity. Some of these projects require additional training for our employees and not all projects may be implemented as

Our operations expose us to potential liability for personal injury or death as a result of the failure of an aircraft component that has been serviced by us or the failure of an aircraft component designed or manufactured by us. While we believe that our liability insurance is adequate to protect us from these liabilities, our insurance may not cover all liabilities. Additionally, as the number ofshould insurance companies providingmarket conditions change, general aviation product liability, insurance coverage has decreased in recent years, insurance coverage may not be available in the future at a cost acceptable to us. Any material liability not covered by insurance or for which third-party indemnification is not available could have a material adverse effect on our financial condition.

From time to time, some of our operating locations have experienced difficulties in attracting and retaining skilled personnel to design, engineer, manufacture, repair and overhaul sophisticated aircraft components. Our ability to operate successfully could be jeopardized if we are unable to attract and retain a sufficient number of skilled personnel to conduct our business.

A significant portion of our net sales are derived from fixed-price contracts under which we have agreed to provide components or aerostructures for a price determined on the date we entered into the contract. Several factors may cause the costs we incur in fulfilling these contracts to vary substantially from our original estimates, and we bear the risk that increased or unexpected costs may reduce our profit or cause us to sustain losses on these contracts. In a fixed-price contract, we must fully absorb cost overruns, notwithstanding the difficulty of estimating all of the costs we will incur in performing these contracts. Because our ability to terminate contracts is generally limited, we may not be able to terminate our performance requirements under these contracts at all or without substantial liability and, therefore, in the event we are sustaining reduced profits or losses, we could continue to sustain these reduced profits or losses for the duration of the contract term. Our failure to anticipate technical problems, estimate delivery reductions, estimate costs accurately or control costs during performance of a fixed-price contract may reduce our profitability or cause significant losses on programs similar in nature to the forward losses incurred on the Boeing 747-8 ("747-8 program") and Bombardier Global 7000/80007500 contracts.

Our business, operations and facilities are subject to numerous stringent federal, state, local, and foreign environmental laws and regulations, and we are subject to potentially significant fines or penalties, including criminal sanctions, if we fail to comply with these requirements. In addition, we could be affected by future laws and regulations, including those imposed in response to climate change concerns and other actions commonly referred to as "green initiatives." Compliance with current and future environmental laws and regulations currently requires and is expected to continue to require significant operating and capital costs.

Pursuant to certain environmental laws, a current or previous owner or operator of a contaminated site may be held liable for the entire cost of investigation, removal or remediation of hazardous materials at such property, whether orproperty. Innocent Landowner Regulations require an Environmental Site Assessment prior to acquisition to prevent unknowingly acquiring impaired property.  Once identified, if the transaction continues, the impairment is not the owner or operator knew of, or was responsible for, the presence of any hazardous materials.covered by insurance. Although management believes that our operations and facilities are in material compliance with such laws and regulations, future changes in such laws, regulations or interpretations thereof or the nature of our operations or regulatory enforcement actions which may arise, may require us to make significant additional capital expenditures to ensure compliance in the future. Certain of our facilities, including facilities acquired and operated by us or one of our subsidiaries, have at one time or another been under active investigation for environmental contamination by federal or state agencies when acquired and, at least in some cases, continue to be under

We and other companies in our industry possess certain proprietary rights relating to designs, engineering, manufacturing processes, and repair and overhaul procedures. In the event that we believe that a third party is infringing upon our proprietary rights, we may bring an action to enforce such rights. In addition, third parties may claim infringement by us with respect to their proprietary rights and may initiate legal proceedings against us in the future. The expense and time of bringing an action to enforce such rights or defending against infringement claims can be significant. Intellectual property litigation involves complex legal and factual questions which makes the outcome of any such proceedings subject to considerable uncertainty. Not only can such litigation divert management's attention, but it can also expose the Company to damages and potential injunctive relief which, if granted, may preclude the Company from making, using, or selling particular products or technology. The expense and time associated with such litigation may have a material and adverse impact on our profitability.

In our overhaul and repair businesses, OEMs of equipment that we maintain for our customers include language in repair manuals relating to their equipment asserting broad claims of proprietary rights to the contents of the manuals used in our operations. Although we believe that our use of manufacture and repair manuals is lawful, there can be no assurance that OEMs will not try to enforce such claims, including through the possible use of legal proceedings, or that any such actions will be unsuccessful.

Our business also depends on using certain intellectual property and tooling that we have rights to use pursuant to license grants under our contracts with our OEM customers. These contracts contain restrictions on our use of the intellectual property and tooling and may be terminated if we violate certain of these restrictions. Our loss of a contract with an OEM customer and the related license rights to use an OEM's intellectual property or tooling would materially adversely affect our business.

Our manufacturing facilities or our customers' facilities could be damaged or disrupted by a natural disaster, war, or terrorist activity. We maintain property damage and business interruption insurance at the levels typical in our industry or for our customers and suppliers, however, a pandemic or other major catastrophe, such as an earthquake, hurricane, fire, flood, tornado or other natural disaster at any of our sites, or war or terrorist activities in any of the areas where we conduct operations could result in a prolonged interruption of our business. Any disruption resulting from these events could cause significant delays in shipments of products and the loss of sales and customers and we may not have insurance to adequately compensate us for any of these events. For leased facilities, timely renewal of leases and risk mitigation from the sale of our leased facilities is required to avoid any business interruption.

Our unionized workforces and those of our customers and suppliers may experience work stoppages. For example, Thestoppages during collective bargaining agreement with our union employees with the IAM District 751 at our Spokane, Washington facility has expired. As of May 11, 2016, the workforce in Spokane of approximately 400 employee has elected to strike. While we are currently in negotiations with the workforce, we have implemented plans to continue production in Spokane with support from other locations. Our union employees with Local 848 at our Red Oak, Texas and Local 952 at our Tulsa, Oklahoma, facilities of the United Auto Workers ("UAW") are currently working without a contract.negotiations. If we are unable to negotiate a contract with those workforces, our operations may be disrupted and we may be prevented from completing production and delivery of products from those facilities, which would negatively impact our results. Contingency plans have been developed that would allow production to continue in the event of a strike.

Many aircraft manufacturers, airlines and aerospace suppliers have unionized workforces. Strikes, work stoppages or slowdowns experienced by aircraft manufacturers, airlines or aerospace suppliers could reduce our customers' demand for our products or prevent us from completing production. In turn, this may have a material adverse effect on our financial condition, results of operations and cash flows.

Our benefit plan assets are invested in a diversified portfolio of investments in both the equity and debt categories, as well as limited investments in other alternative investments. The current market values of all of these investments, as well as the related benefit plan liabilities are impacted by the movements and volatility in the financial markets. In accordance with the Compensation—Retirement Benefits topic of the Accounting Standards Codification ("ASC"), we have recognized the over-fundedoverfunded or under-fundedunderfunded status of a defined benefit postretirement plan as an asset or liability on our balance sheet, and will recognize changes in that funded status in the year in which the changes occur. The funded status is measured as the difference between the fair value of the plan's assets and the projected benefit obligation. A decrease in the fair value of these plan assets or a decrease in interest rates resulting from movements in the financial markets will increase the under-fundedunderfunded status of the plans recorded on our statement of financial positionconsolidated balance sheets and result in additional cash funding requirements to meet the minimum required funding levels.

The military aircraft manufacturers' business, and by extension, our business, is affected by the U.S. Government's continued commitment to programs under contract with our customers. The terms of defense contracts with the U.S. Government generally permit the government to terminate contracts partially or completely, either for its convenience or if we default by failing to perform under the contract. Termination for convenience provisions provide only for our recovery of unrecovered costs incurred or committed, settlement expenses and profit on the work completed prior to termination. Termination for default provisions provide for the contractor to be liable for excess costs incurred by the U.S. Government in procuring undelivered items from another source. On contracts where the price is based on cost, the U.S. Government may review our costs and performance, as well as our accounting and general business practices. Based on the results of such audits, the U.S. Government may adjust our contract-related costs and fees, including allocated indirect costs. In addition, under U.S. Government purchasing regulations, some of our costs, including most financing costs, portions of research and development costs, and certain marketing expenses may not be subject to reimbursement.

We bear the potential risk that the U.S. Government may unilaterally suspend our customers or us from new contracts pending the resolution of alleged violations of procurement laws or regulations. Sales to the U.S. Government are also subject to changes in the government's procurement policies in advance of design completion. An unexpected termination of, or suspension from, a significant government contract, a reduction in expenditures by the U.S. Government for aircraft using our products, lower margins resulting from increasingly competitive procurement policies, a reduction in the volume of contracts awarded to us, or substantial cost overruns could have a material adverse effect on our financial condition, results of operations and cash flows.

U.S. DoD facility security clearance is required in order to be awarded and be able to perform on classified contracts for the U.S. DoD and certain other agencies of the U.S. Government, which is a significant part of our business. We have obtained clearance at

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 contains provisions to improve transparency and accountability concerning the supply of certain minerals and metals, known as conflict minerals, originating from the Democratic Republic of Congo (the "DRC") and adjoining countries. As a result, in August 2012, the SEC adopted annual investigation, disclosure and reporting requirements for those companies that manufacture or contract to manufacture products that contain conflict minerals that originated from the DRC and adjoining countries. We have and will continue to incur compliance costs, including costs related to determining the sources of conflict minerals used in our products and other potential changes to processes or sources of supply as a consequence of such verification activities. The implementation of these rules could adversely affect the sourcing, supply and pricing of materials used in certain of our products. As there may be only a limited number of suppliers offering "conflict free" minerals, we cannot be sure that we will be able to obtain necessary conflict-free minerals from such suppliers in sufficient quantities or at competitive prices. Also, we may face reputational challenges if we determine that certain of our products contain minerals not determined to be conflict free.

Our business is subject to regulation in the United States and internationally.

The manufacturing of our products is subject to numerous federal, state and foreign governmental regulations. The number of laws and regulations that are being enacted or proposed by various governmental bodies and authorities are increasing. Compliance with these regulations is difficult and expensive. If we fail to adhere, or are alleged to have failed to adhere, to any applicable federal, state or foreign laws or regulations, or if such laws or regulations negatively affect sales of our products, our business, prospects, results of operations, financial condition or cash flows may be adversely affected. In addition, our future results could be adversely affected by changes in applicable federal, state, and foreign laws and regulations, or the interpretation or enforcement thereof, including those relating to manufacturing processes, product liability, government contracts, trade rules and customs regulations, intellectual property, consumer laws, privacy laws, as well as accounting standards and taxation requirements (including tax-rate changes, new tax laws or revised tax law interpretations).

Brexit may have short-term and long-term adverse impacts on the Company's operations in the United Kingdom.

The Company’s United Kingdom operations represented approximately 4% of consolidated net sales for the 12 months ended March 31, 2020. The impact of Brexit could adversely affect our business, results of operations, and financial condition. In the short-term, volatility in the British pound sterling could continue as the United Kingdom negotiates its anticipated exit from the European Union. In the longer term, any impact from Brexit on the Company’s United Kingdom operations will depend, in part, on the outcome of tariff, trade, regulatory, and other negotiations.

Item 1B.Unresolved Staff Comments

None.

As of March 31, 2016,2020, our segments owned or leased the following facilitiesproperties that are material to our operations with the following square footage:

At March 31, 2016,2020, our segments occupied 7.4 million64% of the square feet of floor spacefootage in the table above at the following major locations:

•

Systems & Support: West Hartford, Connecticut; Park City, Utah; and Hot Springs, Arkansas

Aerostructures Group: Nashville, Tennessee;

•

Aerospace Structures: Milledgeville, Georgia; Hawthorne, California; Red Oak, Texas; Grand Prairie, Texas; Milledgeville, Georgia; Spokane, Washington; and Stuart, Florida

Aerospace Systems Group: West Hartford, Connecticut; and Park City, Utah

Aftermarket Services Group: Hot Springs, Arkansas

We believe that our properties are adequate to support our operations for the foreseeable future.

Item 3.	Legal Proceedings

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Item 3.Legal Proceedings

In the ordinary course of our business, we are involved in disputes, claims and lawsuits with employees, suppliers and customers, as well as governmental and regulatory inquiries, that we deemare deemed to be immaterial. Some may involve claims or potential claims of substantial damages, fines, penalties or penalties.injunctive relief. While we cannot predict the outcome of any pending or future litigation or proceeding and no assurances can be given, we do not believe that any pending matter will have a material effect, individually or in the aggregate, on ourits financial position or results of operations, although no assurances can be given to that effect.

Item 4.	Mine Safety Disclosures

operations.

Item 4.Mine Safety Disclosures

Not applicable.

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PART II

Item 5.	Item 5.Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Range of Market Price

Equity Securities

Our common stock is traded on the New York Stock Exchange under the symbol "TGI." The following table sets forth the range of high and low prices for our common stock for the periods indicated:

	High				Low
Fiscal 2015
1st Quarter	$	72.31			$	61.86
2nd Quarter	70.38				62.00
3rd Quarter	70.93				59.53
4th Quarter	67.84				51.15
Fiscal 2016
1st Quarter	$	70.68			$	57.25
2nd Quarter	67.16				41.14
3rd Quarter	47.28				32.82
4th Quarter	40.36				22.94

On May 25, 2016, the reported closing price for our common stock was $37.78. As of May 25, 2016,26, 2020, there were approximately 102114 holders of record of our common stock and we believe that our common stock was beneficially owned by approximately 30,00015,000 persons.

Dividend Policy

During fiscal 20162020 and 2015,2019, we paid cash dividends of $0.16$0.16 per share and $0.16$0.16 per share, respectively. However, we suspended the declaration and payment of dividends in March 2020 and, pursuant to the Twelfth Amendment, we agreed not to pay any cash dividends prior to the first date after a fiscal quarter ending on or after March 31, 2022 with respect to which we deliver a compliance certificate demonstrating compliance with the financial maintenance covenants under our Amended Credit Agreement. Further, our declaration and payment of cash dividends in the future and the amount thereof will depend upon our results of operations, financial condition, cash requirements, future prospects, limitations imposed by credit agreements or indentures governing debt securities and other factors deemed relevant by our Board of Directors. No assurance can be given that cash dividends will continue to be declared and paid at historical levels or at all. Certain of our debt arrangements, including the Amended Credit Facility,Agreement, restrict our paying dividends and making distributions on our capital stock, except for the payment of stock dividends and redemptions of an employee's shares of capital stock upon termination of employment. On May 2, 2016,The Company currently has an accumulated deficit which could limit or restrict our ability to pay dividends in the Company announced that its Board of Directors declared a regular quarterly dividend of $0.04 per share on its outstanding common stock. The dividend is next payable on June 15, 2016, to stockholders of record as of May 31, 2016.

future.

Repurchases of Stock

In December 1998, we announced a program to repurchase up to 500,000 shares of our common stock. In February 2008, the Company's Board of Directors authorized an increase in the Company's existing stock repurchase program by up to an additional 500,000 shares of its common stock. In February 2014, the Company's Board of Directors authorized an increase in the Company's existing stock repurchase program by up to an additional 5,000,000 shares of its common stock. DuringThough no purchases have been made in recent years, to the fiscal year ended March 31, 2016, we did not repurchase any shares. During the fiscal years ended March 31, 2015extent permitted by our Amended Credit Agreement and 2014, we repurchased 2,923,011 and 300,000 shares, respectively, for a purchase price of $184.4 million and $19.1 million, respectively. From the inception of the program through March 31, 2013, we repurchased 499,200 shares (prior to fiscal 2012 stock split) for a purchase price of $19.2 million. Repurchasesother documentation governing our indebtedness, repurchases may be made from time to time in open market transactions, block purchases, privately negotiated transactions or otherwise at prevailing prices. No time limit has been set for completion of the program and the terms of our Amended Credit Agreement do not currently permit us to repurchase shares under the program.  As a result, as of May 27, 2016,28, 2020, the Company remains able to purchase an additional 2,277,789 shares.

shares under such program.

Equity Compensation Plan Information

The information required regarding equity compensation plan information will be included in our 2020 Proxy Statement in connection with our 20162020 Annual Meeting of Stockholders to be held on July 21, 2016,16, 2020, under the heading "Equity Compensation Plan Information" and is incorporated herein by reference.

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The following graph compares the cumulative 5-year total return provided stockholders on our common stock relative towith the cumulative total returns of the Russell 1000 index, the Russell 2000 index and the S&P Aerospace & Defense index. An investment of $100 (with reinvestment of all dividends) is assumed to have been made in our common stock and in each of the indexes on March 31, 2011,2015, and its relative performance is tracked through March 31, 2016.

2020.

COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN*

Among Triumph Group, Inc., and The Russell 1000 and 2000 Indexes

And The S&P Aerospace & Defense Index

* $100 invested on March 31, 20112015, in stock or index, including reinvestment of dividends.

		Fiscal year ended March 31,
		2015				2016				2017				2018				2019				2020
Triumph Group, Inc.			100.00				52.91				43.51				42.81				32.63				11.66
Russell 1000			100.00				100.50				118.02				134.52				147.03				135.23
Russell 2000			100.00				90.24				113.90				127.33				129.94				98.77
S&P Aerospace & Defense			100.00				100.97				128.44				182.43				182.20				134.14

	Fiscal year ended March 31
	3/11		3/12		3/13		3/14		3/15		3/16
Triumph Group, Inc.	100.00		142.05		178.40		147.09		136.55		72.14
Russell 1000	100.00		107.86		123.42		151.09		170.33		171.18
S&P Aerospace & Defense	100.00		104.54		121.06		173.68		198.30		200.23

The stock price performance included in this graph is not necessarily indicative of future stock price performance.

Item 6.	Selected Financial Data

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Item 6.Selected Financial Data

The following selected financial data should be read in conjunction with the Consolidated Financial Statementsconsolidated financial statements and related Notesnotes thereto and "Management's Discussionmanagement's discussion and Analysisanalysis of Financial Conditionfinancial condition and Resultsresults of Operations"operations included herein.

		Fiscal Year Ended March 31,
		2020(1)				2019(2)				2018(3)				2017(4)				2016(5)
		(in thousands, except per share data)
Operating Data:
Net sales		$	2,900,117			$	3,364,930			$	3,198,951			$	3,532,799			$	3,886,072
Cost of sales			2,307,393				2,924,920				2,607,556				2,774,449				3,671,684
			592,724				440,010				591,395				758,350				214,388
Selling, general and administrative			257,529				298,386				292,630				285,001				290,338
Depreciation and amortization			138,168				149,904				158,368				176,946				177,755
Impairment of intangible assets			66,121				—				535,227				266,298				874,361
Restructuring			25,340				31,098				40,069				42,177				36,182
Loss on sale of assets and businesses			56,916				235,301				30,741				19,124				—
(Gain) loss on legal judgment or settlement, net of expenses			(9,257	)			—				—				—				5,476
Operating income (loss)			57,907				(274,679	)			(465,640	)			(31,196	)			(1,169,724	)
Non-service defined benefit income			(41,894	)			(62,105	)			(103,234	)			(88,085	)			(78,618	)
Interest expense and other			122,129				114,619				99,442				80,501				68,041
Loss from continuing operations, before    income taxes			(22,328	)			(327,193	)			(461,848	)			(23,612	)			(1,159,147	)
Income tax expense (benefit)			5,798				(5,426	)			(36,457	)			19,340				(111,187	)
Net loss		$	(28,126	)		$	(321,767	)		$	(425,391	)		$	(42,952	)		$	(1,047,960	)
Loss per share:
Loss from continuing operations:
Basic		$	(0.56	)		$	(6.47	)		$	(8.60	)		$	(0.87	)		$	(21.29	)
Diluted (6)		$	(0.56	)		$	(6.47	)		$	(8.60	)		$	(0.87	)		$	(21.29	)
Cash dividends declared per share		$	0.16			$	0.16			$	0.16			$	0.16			$	0.16
Shares used in computing earnings per share:
Basic			50,494				49,698				49,442				49,303				49,218
Diluted (6)			50,494				49,698				49,442				49,303				49,218

		As of March 31,
		2020(1)				2019(2)				2018(3)				2017(4)				2016(5)
		(in thousands)
Balance Sheet Data:
Working capital		$	573,879			$	265,795			$	930,486			$	438,659			$	606,767
Total assets			2,980,333				2,854,574				3,807,064				4,414,600				4,835,093
Long-term debt, including current portion			1,807,507				1,488,821				1,438,284				1,196,300				1,417,320
Total stockholders' (deficit) equity		$	(781,264	)		$	(573,313	)		$	450,534			$	846,473			$	934,944

	Fiscal Year Ended March 31,
	2016(1)				2015(2)				2014(3)				2013(4)				2012(5)
	(in thousands, except per share data)
Operating Data:
Net sales	$	3,886,072			$	3,888,722			$	3,763,254			$	3,702,702			$	3,407,929
Cost of sales	3,597,299				3,141,453				2,911,802				2,763,488				2,564,995
	288,773				747,269				851,452				939,214				842,934
Selling, general and administrative expense	287,349				285,773				254,715				241,349				242,553
Depreciation and amortization	177,755				158,323				164,277				129,506				119,724
Impairment of intangible assets	874,361				—				—				—				—
Restructuring	36,182				3,193				31,290				2,665				6,342
Curtailments, settlements and early retirement incentives	(1,244		)		—				1,166				34,481				(40,400		)
Loss (gain) on legal settlement, net	5,476				(134,693		)		—				—				—
Operating (loss) income	(1,091,106		)		434,673				400,004				531,213				514,715
Interest expense and other	68,041				85,379				87,771				68,156				77,138
(Loss) income from continuing operations, before income taxes	(1,159,147		)		349,294				312,233				463,057				437,577
Income tax (benefit) expense	(111,187		)		110,597				105,977				165,710				155,955
(Loss) income from continuing operations	(1,047,960		)		238,697				206,256				297,347				281,622
Loss from discontinued operations	—				—				—				—				(765		)
Net (loss) income	$	(1,047,960	)		$	238,697			$	206,256			$	297,347			$	280,857
Earnings per share:
(Loss) income from continuing operations:
Basic	$	(21.29	)		$	4.70			$	3.99			$	5.99			$	5.77
Diluted(6)	$	(21.29	)		$	4.68			$	3.91			$	5.67			$	5.43
Cash dividends declared per share	$	0.16			$	0.16			$	0.16			$	0.16			$	0.14
Shares used in computing earnings per share:
Basic	49,218				50,796				51,711				49,663				48,821
Diluted(6)	49,218				51,005				52,787				52,446				51,873

	As of March 31,
	2016(1)				2015(2)				2014(3)				2013(4)				2012(5)
	(in thousands)
Balance Sheet Data:
Working capital	$	606,767			$	1,023,144			$	1,141,741			$	892,818			$	741,105
Total assets	4,835,093				5,956,325				5,553,386				5,239,179				4,597,224
Long-term debt, including current portion	1,417,320				1,368,600				1,550,383				1,329,863				1,158,862
Total stockholders' equity	$	934,944			$	2,135,784			$	2,283,911			$	2,045,158			$	1,793,369

(1)	Includes the divestiture of Triumph Aerospace Structures’ manufacturing operations in Nashville, Tennessee, as well as the gain recognized as a result of the transfer of certain assets and liabilities to AeroSpace Technologies of Korea Inc.

(1) (2)

Includes the divestitures of Triumph Fabrications - San Diego, Inc.; Triumph Fabrications - Ft. Worth, Inc.; Triumph Structures – Kansas City, Inc.; Triumph Structures – Wichita, Inc.; Triumph Gear Systems – Toronto, ULC and Triumph Northwest (The Triumph Group Operations, Inc.); Triumph Aviation Services - NAAS Division, Inc.; Triumph Structures - East Texas, Inc. as well as all of the shares of Triumph Structures - Los Angeles, Inc.; and Triumph Processing, Inc.; as well as the loss recognized as a result of the transition of the Global 7500 program to Bombardier.

(3)

Includes the divestitures of Triumph Processing- Embee Division (September 2017) and Triumph Structures- Long Island (March 2018). Additionally, the fiscal 2018 and prior period operating data has been adjusted as a result of Accounting Standards Update ("ASU") 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost ("ASU 2017-07"). The fiscal 2018 and prior period operating data has not been adjusted as a result of ASU 2014-09, Revenue From Contracts with Customers ("ASU 2014-09"); this affects the comparability of the information reflected in the selected financial data for this year. See Notes to the Consolidated Financial Statements.

(4)

Includes the divestitures of Triumph Aerospace Systems-Newport News, Inc. (September 2016) and Triumph Air Repair, the Auxiliary Power Unit Overhaul Operations of Triumph Aviations Services - Asia, Ltd. and Triumph Engines - Tempe (December 2016). Additionally, the fiscal 2018 and prior period operating data has been adjusted as a result of ASU 2017-07. The fiscal 2018 and prior period operating data has not been adjusted as a result of ASU 2014-09; this affects the comparability of the information reflected in the selected financial data for this year. See Notes to the Consolidated Financial Statements.

(5)

Includes the acquisition of Fairchild Controls Corporation (October 2015) from the date of acquisition, forward losses on the Bombardier and 747-8 programs of $561,158 and restructuring charges of $75,596 (March 2016). Additionally, the fiscal 2018 and prior period operating data has been adjusted as a result of ASU 2017-07. The fiscal 2018 and prior period operating data has not been adjusted as a result of ASU 2014-09; this affects the comparability of the information reflected in the selected financial data for this year. See Notes to the Consolidated Financial Statements.

(6)
(2)	Includes the acquisitions of Spirit AeroSytems Holdings, Inc. - Gulfstream G650 and G280 Wings Programs and forward losses on the 747-8 program of $151,992 (December 2014), North American Aircraft Services, Inc. (October 2014) and GE Aviation - Hydraulic Actuation (June 2014) from the date of each respective acquisition. See Notes to the Consolidated Financial Statements.

(3)

Includes the acquisitions of Insulfab Product Line (Chase Corporation) (October 2013), General Donlee Canada, Inc. (October 2013) and Primus Composites (May 2013) from the date of each respective acquisition. Includes the divestitures of Triumph Aerospace Systems - Wichita (January 2014) and Triumph Instruments (April 2013) from the date of respective divestiture. See Note 3 and 4 to the Consolidated Financial Statements, respectively.

(4)	Includes the acquisitions of Goodrich Pump & Engine Control Systems, Inc. (March 2013) and Embee, Inc. (December 2012) from the date of each respective acquisition.

(5)	Includes the acquisition of Aviation Network Services, LLC (October 2011) from the date of acquisition.

(6)	Diluted earnings per share for the fiscal years ended March 31, 2015, 2014, 2013 and 2012, included 40,177, 811,083, 2,400,439 and 2,606,189 shares respectively, related to the dilutive effects of the Company's Convertible Notes.

Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations

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Item 7.  Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Consolidated Financial Statementsconsolidated financial statements and notes thereto contained elsewhere herein.

OVERVIEW

We are a major supplier to the aerospace industry and have three operatingtwo reportable segments: (i) Triumph Aerostructures Group,Systems & Support, whose companies'companies’ revenues are derived from theintegrated solutions, including design, manufacture, assemblydevelopment and integrationsupport of proprietary components, subsystems and systems, production of complex assemblies using external designs, as well as full life cycle solutions for commercial, regional and military aircraft; and (ii) Aerospace Structures, whose companies supply commercial, business, regional, and military manufacturers with large metallic and composite aerostructuresstructures and structural components for the global aerospace original equipment manufacturers, or OEM, market; (ii) Triumph Aerospace Systems Group, whose companies design, engineerproduce close-tolerance parts primarily to customer designs and manufacturemodel-based definition, including a wide range of proprietaryaluminum, hard metal and build-to-print components, assembliescomposite structure capabilities.

During the fiscal year ended March 31, 2020, the Company divested of a number of its assets and systems alsooperations, including the sale of its manufacturing operations at its Nashville, TN, facility and the assignment of its E-2 Jets contract with Embraer for the OEM market; and (iii) Triumph Aftermarket Services Group, whose companies serve aircraft fleets, notably commercial airlines, the U.S. military and cargo carriers, through the maintenance, repair and overhaulmanufacture of aircraftstructural components and accessories manufactured by third parties.

Effective October 21, 2015, the Company acquired the ownershipfor their program to AeroSpace Technologies of allKorea Inc. ("ASTK").  The operating results of the outstanding shares of Fairchild Controls Corporation ("Fairchild"). Fairchild is a leading provider of proprietary thermal management systems, auxiliary power generation systems and related aftermarket spares and repairs. The acquired business operates as Triumph Thermal Systems-Maryland, Inc. and its resultsNashville manufacturing operations are included in Aerospace Systems Group fromStructures through the date of acquisition.

divestiture or assignment.  Collectively, these transactions are referred to as the “fiscal 2020 divestitures.”  The Company recognized combined net losses of $56.9 million associated with the fiscal 2020 divestitures, which are presented on the accompanying consolidated statements of operations within loss on sale of assets and businesses, net.

Significant financial results for the fiscal year ended March 31, 20162020, include:

•

Net sales for fiscal 2020 decreased 13.8% to $2.90 billion.

Net sales for fiscal 2016 decreased 0.1% to $3.89 billion, including a 9.8% decrease in organic sales.

•

Operating income for fiscal 2020 was $57.9 million.

Operating loss for fiscal 2016 was $(1.09) billion.

•

Included in operating income for fiscal 2020 was loss on sale of assets and businesses of $56.9 million and restructuring charges of $25.3 million.

Included in operating loss for fiscal 2016 was a non-cash impairment charge of $874.4 million primarily related to goodwill and the indefinite-lived tradename in the Aerostructures reporting, forward losses to the Bombardier Global 7000/8000 and 747-8 programs of $561.2 million and restructuring and related accelerated depreciation charges of $81.0 million.

•

Net loss for fiscal 2020 was $28.1 million or $0.56 per diluted common share.

Net loss for fiscal 2016 was $(1.05) billion and included a charge for an income tax valuation allowance of $155.8 million.

•

Backlog decreased 14.5% over the prior year to $3.2 billion due to divestitures.

Backlog decreased 17.4% over the prior year to $4.15 billion.

For the fiscal year ended March 31, 2016, net sales totaled $3.89 billion, a 0.1% decrease from fiscal year 2015 net sales of $3.89 billion. Net income for fiscal year 2016 decreased 539.0% to $(1.05) billion, or $(21.29) per diluted common share, versus $238.7 million, or $4.68 per diluted common share, for fiscal year 2015.

Our working capital needs are generally funded through cash flows from operations and borrowings under our credit arrangements. For the fiscal year ended March 31, 2016,2020, we generated$83.9 $96.7 million of cash flows from operating activities, used$128.0received $7.4 million in from investing activities, and received$32.5 $293.7 million in from financing activities. Cash flows fromused in operating activities in fiscal year 2015 was $467.3 million and included $112.3 million in pension contributions.

During the fiscal year ended March 31, 2016, the2019 were $174.4 million.

The Company has committed to aseveral plans (which were initiated in fiscal 2016) that incorporated the restructuring of certain of its businesses as well as the consolidation of certain of its facilities ("2016 Restructuring Plan"). facilities. As of March 31, 2020, with the exception of three pending facility closures to be completed in fiscal 2021 or 2022, the Company has substantially completed these plans.

On March 18, 2020, in response to anticipated market headwinds primarily arising from the impact of COVID-19, the Company committed to new restructuring and cost reduction activities to align capacity with expected demand.  These plans and related activities are expected to generate savings of approximately $120.0 million in fiscal 2021 on a consolidated basis, primarily from headcount and other human resource related cost reductions.  While the long-term outlook for the aerospace industry remains positive due the fundamental drivers of air travel demand, current expectations are that it will take 2-3 years for travel to return to calendar 2019 levels and a few years beyond that for the industry to return to long-term trend growth, although there can be no assurance that such period will not be longer. To balance the supply and demand given the COVID-19 shock and to preserve long-term potential and competitiveness, our customers have decided to reduce the production rates of several of their commercial aircraft programs. These rate decisions were based on assessments of the demand environment. There is significant uncertainty with respect to when commercial air traffic levels will begin to recover, and whether and at what point capacity will return to and/or exceed pre-COVID-19 levels.  The Company will work with its customers to closely monitor the key factors that affect backlog and future demand including customers’ evolving manufacturing plans, the widebody replacement cycle and the cargo market, but such impact could be material and make it difficult to compare periods.

The Company expects COVID-19 to reduce its footprint by approximately 3.5 million square feet anddemand for commercial aviation aftermarket due to the recent sharp decreases in flights; as well as reduce head count by 1,200 employees. Over the next few fiscal years, the Company estimates that it will record aggregate pre-tax charges of $150.0 million to $160.0 milliondemand for commercial aviation production as OEMs have lowered their related to these programs, which represent employee termination benefits, contract termination costs, accelerated depreciation and facility closure and other exit costs, anddelivery rate assumptions.  The COVID-19 related reduction in OEM production rates will result in additional costs to produce and deliver our products, which may not be mitigated through our cost reduction initiatives and could negatively impact earnings and cash flows, particularly with respect to our fixed-price contracts.

The Company is unable at this time to reasonably estimate potential future additional financial impacts or a range of loss, if any, due to continued uncertainties related to the impacts of COVID-19 on our operations, supply chain and customers, future changes to OEM production rates, supply chain impacts, and/or the results of negotiations with particular customers. Any such impacts, including any changes in our estimates, could have a material adverse effect on our financial position, results of operations, and/or cash outlays. flows.

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For the fiscal year ended March 31, 2016,example, the Company recorded chargesexpects that, in the event that its customers are unable to resume aircraft deliveries consistent with provided assumptions, the continued absence of $81.0 millionrevenue, earnings, and cash flows associated with those deliveries would continue to have a material impact on our operating results. In the event that future OEM production rate increases occur at a slower rate or take longer than the Company is currently assuming, the Company expects that the growth in inventory and other cash flow impacts associated with production would decrease. However, while any prolonged delays in planned OEM production rate increases could mitigate the impact on our liquidity, it could significantly increase the overall expected costs to manufacture our products, which would reduce operating margins and/or increase abnormal production costs in the future.  Additionally, the declines in global air travel are expected to result in reduced demand for MRO services and uncertainty exists related to this program, including accelerated depreciationthe length of $22.4 milliontime until air travel returns to historical levels.

From fiscal 2014 through fiscal 2020, our Aerospace Structures business unit had been performing design, development and severance of $16.3 million.

We are currently performing workinitial manufacturing on several new programs, which are in various stages of development. Several of the these programs are expected to enter flight testing during our fiscal 2017, including the Bombardier Global 7000/8000, and7500, the Embraer second generation E-Jet ("E2-Jets") and we expect to deliver revenue generating production units for these programs in late fiscal 2017, or early fiscal 2018.more recently, the Gulfstream G500/G600 programs. Historically, low-rate production commences during flight testing, followed by an

increase to full-rate production, assuming that successful testing and certification are achieved. Accordingly, we anticipate that each of these programs will begin generating full-rate production level revenues between fiscal 2019 and fiscal 2021. We are still in the early development stages for the Gulfstream G500/G600 programs, as these aircraft are not expected to enter service until fiscal 2019. Transition of each of these programs from development to recurring production levels is dependent upon the success of each program at achieving flight testing and certification, as well as the ability of the OEM to generate acceptable levels of aircraft sales.

Fiscal 2016 was a challenging year for certain of our new programs. While work progressed on these development programs, we have experienced difficulties in achieving estimated cost targets particularly in the areas of engineering and estimated recurring costs. As describedcosts which resulted in more detailforward losses. Additionally, from fiscal 2015 to fiscal 2019, our Aerospace Structures business unit experienced operating and forward losses on its production of the Boeing 747-8 fuselage for Boeing, Gulfstream G280 wing for Israel Aerospace Industries, Ltd ("IAI") and Gulfstream G650 wing for Gulfstream. Further discussion is included below regarding the significant developments of each program.

Boeing 737 MAX

The Boeing 737 MAX program represents approximately 5% of revenue for the fiscal year ended March 31, 2020.  The temporary suspension of 737 MAX production by Boeing in “ResultsJanuary 2020 and subsequent temporary suspension of Operations”, we recordedproduction operations in the Puget Sound area as a $399.8 million forward lossresult of the COVID-19 crisis in March 2020, had minimal unfavorable effect on our Bombardier Global 7000/8000 wing contract inresults through March 31, 2020. Boeing has since resumed production operations during the fourthweek of April 20, 2020 and updated the delivery rate assumptions. Boeing’s assumptions include the return of 737 MAX aircraft production during the second calendar quarter of 2016.2020 as timing and conditions of return to service and COVID-19 impacts are better understood; as well as  the timing of regulatory approvals will enable 737 MAX deliveries to resume during the third calendar quarter of 2020.

Boeing has stated it has approximately 450 airplanes in inventory at March 31, 2020, and has also assumed that the majority of 737 MAX airplanes produced during the grounding and included within inventory will be delivered during the first year after the resumption of deliveries, although at a slower pace than our previous assumptions due to COVID-19. The Global 7000/8000 contract provides for fixed pricingslower production and requires us to fund certain up-front development expenses, with certain milestone payments made by Bombardier. The Global 7000/8000 program charge resulted in the impairment of previously capitalized pre-production costsdelivery rate ramp-ups reflect commercial airline industry uncertainty due to the combinationimpact of cost recovery uncertainty, higher than anticipated non-recurring costs and increased forecasted costs on recurring production. The increases in costs were driven by several factors, including: changing technical requirements, increased spendingCOVID-19. Based on the design and engineering phaseabove assumption, Triumph expects to see declines in revenue across both of its operating segments in its fiscal 2021. A resurgence of COVID-19 that results in additional delays or shut downs could further exacerbate this expectation.

Boeing 747-8

As disclosed during fiscal 2016, Boeing announced a rate reduction to the 747-8 program, which lowered production to one plane every two months.  The impact of the program and uncertainty regarding costrate reduction and cost recovery initiatives with our customer and suppliers. Further cost increases or an inability to meet revised recurring cost forecasts on the Global 7000/8000 program may resultresulted in additional forward loss reservesduring the fiscal year ended March 31, 2016.

In March 2017, the Company settled several outstanding change orders and open pricing on a number of its programs with Boeing.  The agreement included pricing settlements, advanced payments, delivery schedule adjustments and the opportunity to extend the mutual relationship on future programs.  The agreement also provided for continued build ahead on the 747-8 program through the end of the existing contract, resulting in future periods, while improvementsa reduction to the previously recognized forward losses on the 747-8 program.

As of March 31, 2020, Triumph’s production on this program has substantially completed from its Hawthorne, CA facility, with the remaining production from its Grand Prairie, TX, facility expected to complete in future costs comparedlate fiscal 2021.  Facility exit plans are underway at both locations and are expected to current estimates may result in favorable adjustments ifadditional cost to exit of approximately $20.0 million through mid-fiscal 2022 and result in projected cash uses.

G280

We acquired both the G280 and G650 wing programs in fiscal 2015 and received proceeds for $160.0 million as both contracts were operating at a loss. While operations have improved on the G650 since acquisition as noted further below, the cost profile of the G280 wing program has continued to result in forward loss reservescharges, including $29.1 million in the fiscal year ended March 31, 2019.

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In April 2019, the Company and IAI reached an agreement to transition the manufacture of the G280 wing to IAI. The two companies have developed detailed transition plans to enable a transition of work.  Our contract with IAI will terminate upon completion of the transition of work.  Our forward loss recognized in the fiscal year ended March 31, 2019, noted above includes the cost to transition, which is estimated to be completed in mid-fiscal 2021 and include projected cash uses.  Changes to the forward loss associated with this program were immaterial in the year ended March 31, 2020.  

In May 2020, the Company reached a letter of intent to the accelerated transfer of the G280 wing program to Israel Aerospace Industries and Korean Aerospace Industries by mid-2020 at which point the leased Tulsa factory will be closed.

G650

In the first quarter of fiscal 2019, the Company reached an agreement with Gulfstream to optimize the supply chain on the Company's G650 work scope.  The G650 wing box and wing completion work, which had been co-produced across three facilities at both companies, are no longer required.

being consolidated into Gulfstream’s facilities in Savannah, Georgia.  The Company completed the manufacturing of its final wing box in July 2019.  The Company anticipates reaching an agreement to sell its remaining G650 wing supply chain activity and engineering services to Gulfstream, although the continued impact of COVID-19 could impact the timing and terms thereof. This transaction is expected to close in the first half of fiscal 2021.

E2-Jets

Under our contract with Embraer, we havehad the exclusive right to design, develop and manufacture the center fuselage section III, rear fuselage section and various tail section components (rudder and elevator) for the E2-Jets over the initial 600 ship sets.  The contract providesprovided for funding on a fixed amount of non-recurringnonrecurring costs, which willto be paid over a specified number of production units.  Higher than expected spending on the E2-Jets program has resulted in a low single digitnear break-even estimated profit margin percentage, with additional potential future cost pressures as well as opportunities for improved performance.  While we still estimate positive margins for this contract, risksRisks related to additional engineering on the retained component manufacturing as well as the recurring cost profile remainsremain on this program.

During the fiscal year ended March 31, 2018, the Company reached an agreement with AeroSpace Technologies of Korea Inc. ("ASTK") to optimize the supply chain under our portion of the E2 program. Under this agreement, ASTK will build and transport fuselage shipsets to Embraer and establish a facility in Brazil to manage stock and repairs locally.  At the time, the Company maintained its role as the supply chain integrator on the program.

In April 2019, we announced an agreement to assign our contract with Embraer for the manufacture of structural components for their program to ASTK.  Under this program enters flight testing.

agreement, we will remain a supplier to ASTK for the rudder and elevator components.  We seek additional considerationcompleted the assignment of our contract during fiscal year 2020 and recognized a gain of approximately $10.0 million included in our Aerospace Structures operating income.

T-7 Red Hawk

In September 2017, the Company reached an agreement with Boeing to supply the wing, vertical tail and horizontal tail structures for customer work statement changes throughout the new T-7 Red Hawk, originally known as the Boeing T-X, for the U.S. Air Force.  In September 2018, the U.S. Air Force awarded the contract to Boeing.  In fiscal 2020, the Company continued supply chain analysis in support of Boeing's preliminary design.  Risks related to development process as a standard course of business. The ability to recover or negotiate additional consideration is not certain and varies by contract. Varying market conditions for these products may also impactrecurring productions costs are possible and could result in future profitability.

forward losses.

Although none of these newthe development or production programs noted above individually are expected to have a material impact on our net revenues, they do have the potential, either individually or in the aggregate, to materially and negatively impact our consolidated results of operations if future changes in estimates result in the need for a forward loss provision. Absent any such loss provisions, we do not anticipate that any of these new programs will significantly dilute our future consolidated margins.

In January 2016, Boeing announcedmargins, although a rate reduction to the 747-8 program, which lowers production to one plane every two months. We have assessed theprolonged impact of the rate reduction and have recorded an additional $161.4 million forward loss during the quarter ended March 31, 2016. This announcement follows the September 2015 decision by Boeing to in-source production of the 747-8 program beginning in the second half of fiscal 2019, effectively terminating this program with us after our current contract. Additional costs associated with exiting the facilities where the 747-8 program is manufactured, such as asset impairment, supplier and lease termination charges, as well as severance and retention payments to employees and contractors have been included in the 2016 Restructuring Plan.

As disclosed during fiscal 2015, we also recognized a provision for forward losses associated with our long-term contract on the 747-8 program. There is still risk similar to what we have experienced on the 747-8 program. Particularly, our ability to manage risks related to supplier performance, execution of cost reduction strategies, hiring and retaining skilled production and management personnel, quality and manufacturing execution, program schedule delays and many other risks, will determine the ultimate performance of these long-term programs.

Consistent with our policy described in our Critical Accounting Policies here within, we performed Step 1 of the goodwill impairment test on an interim basis upon the occurrence of events or substantive changes in circumstances that indicate a reporting unit's fair value may be less than its carrying value. During the third quarter of fiscal 2016, we performed an interim assessment of the fair value of our goodwill and indefinite-lived intangible assets due to potential indicators of impairment related to the continued decline in our stock price during the third quarter.

Our assessment focused on the Aerostructures reporting unit since it had significant changes in its economic indicators and adjusted for select changes in the risk adjusted discount rate to consider both the current return requirements of the market and the risks inherent in the reporting unit, expected long-term growth rate and cash flow projections to determine if any decline in the estimated fair value of a reporting unitCOVID-19 could result in a goodwill impairment. We concluded that the goodwill was not impaired as of the interim impairment assessment date. However, the excess of the fair value over the carrying value was within 5% for the Company's Aerostructures reporting unit. The amount of goodwill for our Aerostructures reporting unit amounted to $1.42 billion as of the interim testing date.

changes in expectations.

During the fourth quarter of the fiscal year ended March 31, 2016, consistent with our policy described herein, we performed our annual assessment2019, the Company divested of a number of its assets and operations, including (i) selling all of the fair valueshares of our goodwill for each of our three reporting units. We concluded that the goodwill of our Aerostructures reporting unit was impaired asTriumph Structures - East Texas, Inc. and all of the annual testing date. We concluded thatshares of Triumph Structures - Los Angeles, Inc. and Triumph Processing, Inc. (collectively, the goodwill had an implied fair value"Long & Large"), (ii) transitioning the responsibility for the Bombardier Global 7500 ("Global 7500") wing program manufacturing operations of $822.8Aerospace Structures to Bombardier, (iii) selling all of the shares of Triumph Fabrications - San Diego, Inc. and Triumph Fabrications - Ft. Worth, Inc. (together, "Fabrications"), (iv) selling all of the shares of Triumph Structures – Kansas City, Inc., Triumph Structures – Wichita, Inc., Triumph Gear Systems – Toronto, ULC and Triumph Northwest (The Triumph Group Operations, Inc.) (together, "Machining"), and (v) selling all of the shares of Triumph Aviation Services - NAAS Division, Inc. ("NAAS"). Collectively, these transactions are referred to as the "fiscal 2019 divestitures". The Company recognized combined net losses of $235.3 million (Level 3) compared to a carrying value of $1.42 billion. Accordingly, we recorded a non-cash impairment charge duringassociated with the fourth quarter of fiscal 2016 of $597.6 million,2019 divestitures, which isare presented on the accompanying Consolidated Statementsconsolidated statements of Operations as "Impairmentoperations within loss on divestitures. With the exception of intangible assets".NAAS, the operating results for the fiscal 2019 divestitures are included in Aerospace Structures ("fiscal 2019 Aerospace Structures Divestitures") through the respective dates of divestiture. The declineoperating results for NAAS are included in fair value isSystems & Support through the resultdate of continued declines in stock price and related market multiples for stock price to EBITDA of bothdivestiture.

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During fiscal 2018, the Company and our peer group. Going forward, we will continue to monitor the performance of this reporting unit in relation to the key assumptions in our analysis.

In the event that market multiples for stock price to EBITDA in the aerospace and defense markets decrease, or the expected EBITDA and cash flows for our reporting units decreases, an additional goodwill impairment charge may be required, which would adversely affect our operating results and financial condition. If management determines that impairment exists, the impairment will be recognized in the period in which it is identified.

During the third quartersold all of the fiscal year ended March 31, 2016, we performed an interim assessmentshares of fair value on our indefinite-lived intangible assets due to potential indicators(i) Triumph Processing - Embee Division, Inc. ("Embee") and (ii) Triumph Structures - Long Island ("TS-LI"), (collectively, the "fiscal 2018 divestitures") for total cash proceeds of impairment related to the continued decline in our stock price during the fiscal third quarter. We estimated the fair value$74.5 million and a combined loss of the tradenames using the relief-from-royalty method, which uses several significant assumptions, including revenue projections that consider historical and estimated future results, general economic and market conditions, as well as the impact of planned business and operational strategies. The following estimates and assumptions were also used in the relief-from-royalty method:

•Royalty rates between 2% and 4% based on market observed royalty rates and profit split analysis; and

•Discount rates between 12% and 13% based on the required rate of return for the tradename assets.

Based on our evaluation, we concluded that the Vought tradename had a fair value of $195.8$28.3 million (Level 3) compared to a carrying value of $425.0 million. Accordingly, we recorded a non-cash impairment charge during the quarter ended December 31, 2015, of $229.2 million, which is presented on the accompanying Consolidated Statementsconsolidated statements of Operationsoperations as "Impairmentloss on divestitures and is included in Corporate. The operating results of intangible assets". The declineEmbee were included in fair value compared to carrying value of the Vought tradename is the result of declining revenues from production rate reductionsSystems & Support and the slower than previously projected ramp in Bombardier Global 7000/8000 and the timingoperating results of associated earnings.

During the fourth quarter of the fiscal year ended March 31, 2016, we performed our annual assessment of fair value on our indefinite-lived intangible assets. We estimated the fair value of the tradenames using the relief-from-royalty method, which uses several significant assumptions, including revenue projections that consider historical and estimated future results, general economic and market conditions, as well as the impact of planned business and operational strategies. The following estimates and assumptionsTS-LI were also used in the relief-from-royalty method:

•Royalty rates between 2% and 4% based on market observed royalty rates and profit split analysis; and

•Discount rate of 14% based on the required rate of return for the tradename assets, which increased from our interim assessment driven by increased risk due to continued declines in stock price and related market multiples for stock price to EBITDA of both the Company and our peer group and increased interest rates.

Based on our evaluation of indefinite-lived assets, including the tradenames, we concluded that the Vought and Embee tradenames had a fair value of $163.0 million (Level 3) compared to a carrying value of $209.2 million. The decline in fair value compared to carrying value of the tradenames is the result of the increase in discount rate during the fourth quarter, which required the Company to assess whether events and/or circumstances have changed regarding the indefinite-life conclusion. Accordingly, we revalued both the tradenames as if these intangible assets were no longer indefinite and recorded a non-cash impairment charge during the fiscal year ended March 31, 2016, of $46.2 million, which is presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets". Additionally, we determined that the tradenames will be amortized over their remaining estimated useful life of 20 years.

In the event of significant loss of revenues and related earnings associated with the Vought and Embee tradenames, further impairment charges may be required, which would adversely affect our operating results.

The collective bargaining agreement with our union employees with IAM District 751 at our Spokane, Washington facility has expired. As of May 11, 2016, the workforce in Spokane of approximately 400 employees has elected to strike. While we are currently in negotiations with the workforce, we have implemented plans to continue production in Spokane with support from other locations. Our union employees with UAW Local 848 at our Red Oak, Texas facility and UAW Local 952 at our Tulsa, Oklahoma facility are currently working without a contract. If we are unable to negotiate a contract with each of those workforces, our operations may be disrupted and we may be prevented from completing production and delivery of products from those facilities, which would negatively impact our results. Contingency plans have been developed that would allow production to continue in the event of an additional strike.

Effective December 30, 2014, a wholly-owned subsidiary of the Company, Triumph Aerostructures-Tulsa LLC, doing business as Triumph Aerostructures-Vought Aircraft Division-Tulsa, completed the acquisition of the Gulfstream G650 and G280 wing programs (the "Tulsa Programs") located in Tulsa, Oklahoma, from Spirit AeroSystems, Inc. The acquisition of the Tulsa Programs establishes the Company as a leader in fully integrated wing design, engineering and production and advances its standing as a strategic Tier One Capable aerostructures supplier. The acquired business operates as Triumph Aerostructures-Vought Aircraft Division-Tulsa and its results are included in the Aerostructures Group from the date of acquisition.

Effective October 17, 2014, the Company acquired the ownership of all of the outstanding shares of North American Aircraft Services, Inc. and its affiliates ("NAAS"). NAAS is based in San Antonio, Texas, with fixed-based operator units throughout the United States as well as international locations and delivers line maintenance and repair, fuel leak detection and fuel bladder cell repair services. The acquired business operates as Triumph Aviation Services-NAAS Division and its results are included in Aftermarket Services Group from the date of acquisition.

Effective June 27, 2014, the Company acquired the hydraulic actuation business of GE Aviation ("GE"). GE's hydraulic actuation business consists of three facilities located in Yakima, Washington, Cheltenham, England and the Isle of Man and is a technology leader in actuation systems. GE's key product offerings include complete landing gear actuation systems, door actuation, nose-wheel steerings, hydraulic fuses, manifolds flight control actuation and locking mechanisms for the commercial, military and business jet markets. The acquired business operates as Triumph Actuation Systems-Yakima and Triumph Actuation Systems-UK & IOM and its results are included in Aerospace Systems Group from the dateStructures, respectively, through their dates of acquisition.

disposal.

RESULTS OF OPERATIONS

The following includes a discussion of our consolidated and business segment results of operations. The Company's diverse structure and customer base do not provide for precise comparisons of the impact of price and volume changes to our results. However, we have disclosed the significant variances between the respective periods.

Non-GAAP Financial Measures

We prepare and publicly release annual audited and quarterly unaudited financial statements prepared in accordance with U.S. GAAP. In accordance with Securities and Exchange Commission (the "SEC") guidance on Compliance and Disclosure Interpretations,rules, we also disclose and discuss certain non-GAAP financial measures in our public filings and earning releases. Currently, the non-GAAP financial measuremeasures that we disclose isare Adjusted EBITDA, which is our (loss) income from continuing operationsnet loss before interest, income taxes, amortization of acquired contract liabilities, legal settlements, loss on divestitures, depreciation and amortization; and Adjusted EBITDAP, which is Adjusted EBITDA, before pension expense or benefit, including the effects of curtailments, settlements, and other early retirement incentives and depreciation and amortization.incentives. We disclose Adjusted EBITDA on a consolidated and Adjusted EBITDAP on a consolidated and a reportable segment basis in our earnings releases, investor conference calls and filings with the SEC. The non-GAAP financial measures that we use may not be comparable to similarly titled measures reported by other companies. Also, in the future, we may disclose different non-GAAP financial measures in order to help our investors more meaningfully evaluate and compare our future results of operations towith our previously reported results of operations.

We view Adjusted EBITDA and Adjusted EBITDAP as an operating performance measuremeasures and, as such, we believe that the U.S. GAAP financial measure most directly comparable to itsuch measures is income from continuing operations.net loss. In calculating Adjusted EBITDA and Adjusted EBITDAP, we exclude from (loss) income from continuing operationsnet loss the financial items that we believe should be separately identified to provide additional analysis of the financial components of the day-to-day operation of our business. We have outlined below the type and scope of these exclusions and the material limitations on the use of these non-GAAP financial measures as a result of these exclusions. Adjusted EBITDA isand Adjusted EBITDAP are not a measurementmeasurements of financial performance under U.S. GAAP and should not be considered as a measure of liquidity, as an alternative to net (loss) income, (loss) income from continuing operations,loss, or as an indicator of any other measure of performance derived in accordance with U.S. GAAP. Investors and potential investors in our securities should not rely on Adjusted EBITDA or Adjusted EBITDAP as a substitute for any U.S. GAAP financial measure, including net (loss) income or (loss) income from

continuing operations.loss. In addition, we urge investors and potential investors in our securities to carefully review the reconciliation of Adjusted EBITDA and Adjusted EBITDAP to (loss) income from continuing operationsnet loss set forth below, in our earnings releases, and in other filings with the SEC and to carefully review the U.S. GAAP financial information included as part of our Quarterly Reports on Form 10-Q and our Annual Reports on Form 10-K that are filed with the SEC, as well as our quarterly earnings releases, and compare the U.S. GAAP financial information with our Adjusted EBITDA.

EBITDA and Adjusted EBITDAP.

Adjusted EBITDA isand Adjusted EBITDAP are used by management to internally measure our operating and management performance and by investors as a supplemental financial measure to evaluate the performance of our business that, when viewed with our U.S. GAAP results and the accompanying reconciliation, we believe provides additional information that is useful to gain an understanding of the factors and trends affecting our business. We have spent more than 20 years expanding our product and service capabilities, partially through acquisitions of complementary businesses. Due to the expansion of our operations, which included acquisitions, our (loss) income from continuing operationsnet loss has included significant charges for depreciation and amortization. Adjusted EBITDA excludesand Adjusted EBITDAP exclude these charges and providesprovide meaningful information about the operating performance of our business, apart from charges for depreciation and amortization. We believe the disclosure of Adjusted EBITDA and Adjusted EBITDAP helps investors meaningfully evaluate and compare our performance from quarter to quarter and from year to year. We also believe Adjusted EBITDA is a measureand Adjusted EBITDAP are measures of our ongoing operating performance because the isolation of non-cashnoncash charges, such as depreciation and amortization, and non-operatingnonoperating items, such as interest, and income taxes, pension and other postretirement benefits, provides additional information about our cost structure and, over time, helps track our operating progress. In addition, investors, securities analysts, and others have regularly relied on Adjusted EBITDA and Adjusted EBITDAP to provide a financial measuremeasures by which to compare our operating performance against that of other companies in our industry.

Set forth below are descriptions of the financial items that have been excluded from our (loss)net income from continuing operations to calculate Adjusted EBITDA and Adjusted EBITDAP and the material limitations associated with using thisthese non-GAAP financial measuremeasures as compared to (loss) incomewith net loss from continuing operations:

•

Gains or losses from sale of assets and businesses may be useful for investors to consider because they reflect gains or losses from sale of operating units or other assets. We do not believe these earnings necessarily reflect the current and ongoing cash earnings related to our operations.

•

Legal judgments and settlements, when applicable, may be useful for investors to consider because it reflects gains or losses from disputes with third parties. We do not believe these earnings necessarily reflect the current and ongoing cash earnings related to our operations.

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•

Non-service defined benefit income or expense from our pension and other postretirement benefit plans (inclusive of the adoption of ASU 2017-07 and certain pension related transactions such as curtailments, settlements, early retirement or other incentives) may be useful for investors to consider because they represent the cost of postretirement benefits to plan participants, net of the assumption of returns on the plan's assets and are not indicative of the cash paid for such benefits. We do not believe these earnings (expenses) necessarily reflect the current and ongoing cash earnings related to our operations.

Curtailments, settlements and early retirement incentives may be useful for investors to consider because it represents the current period impact of the change in the defined benefit obligation due to the reduction in future service costs as well as the incremental cost of retirement incentive benefits paid to participants.

•

Amortization of acquired contract liabilities may be useful for investors to consider because it represents the non-cash earnings on the fair value of off-market contracts acquired through acquisitions. We do not believe these earnings necessarily reflect the current and ongoing cash earnings related to our operations.

Amortization of acquired contract liabilities may be useful for investors to consider because it represents the non-cash earnings on the fair value of off-market contracts acquired through acquisitions. We do not believe these earnings necessarily reflect the current and ongoing cash earnings related to our operations.

•

Amortization expense (including goodwill and intangible asset impairments) may be useful for investors to consider because it represents the estimated attrition of our acquired customer base and the diminishing value of tradenames, product rights, licenses, or, in the case of goodwill, other assets that are not individually identified and separately recognized under U.S. GAAP. We do not believe these charges necessarily reflect the current and ongoing cash charges related to our operating cost structure.

Amortization expense (including intangible asset impairments) may be useful for investors to consider because it represents the estimated attrition of our acquired customer base and the diminishing value of product rights and licenses.

•

Depreciation may be useful for investors to consider because it generally represents the wear and tear on our property and equipment used in our operations. We do not believe these charges necessarily reflect the current and ongoing cash charges related to our operating cost structure.

Depreciation may be useful for investors to consider because it generally represents the wear and tear on our property and equipment used in our operations. We do not believe these charges necessarily reflect the current and ongoing cash charges related to our operating cost structure.

•

The amount of interest expense and other we incur may be useful for investors to consider and may result in current cash inflows or outflows. However, we do not consider the amount of interest expense and other to be a representative component of the day-to-day operating performance of our business.

The amount of interest

•

Income tax expense may be useful for investors to consider because it generally represents the taxes which may be payable for the period and the change in deferred income taxes during the period and may reduce the amount of funds otherwise available for use in our business. However, we do not consider the amount of income tax expense and other we incur may be useful for investors to consider and may result in current cash inflows or outflows. However, we do not consider the amount of interest expense and other to be a representative component of the day-to-day operating performance of our business.

Income tax expense may be useful for investors to consider because it generally represents the taxes which may be payable for the period and the change in deferred income taxes during the period and may reduce the amount of funds otherwise available for use in our business. However, we do not consider the amount of income tax expense to be a representative component of the day-to-day operating performance of our business.

Management compensates for the above-described limitations of using non-GAAP measures by using a non-GAAP measure only to supplement our U.S. GAAP results and to provide additional information that is useful to gain an understanding of the factors and trends affecting our business.

The following table shows our Adjusted EBITDA and Adjusted EBITDAP reconciled to our (loss) income from continuing operationsnet loss for the indicated periods (in thousands):

		Fiscal year ended March 31,
		2020				2019				2018
Net loss (U.S. GAAP measure)		$	(28,126	)		$	(321,767	)		$	(425,391	)
Legal judgment gain, net of expenses			(9,257	)			—				—
Loss on sale of assets and businesses, net			56,916				235,301				30,741
Adoption of ASU 2017-07			—				87,241				—
Amortization of acquired contract liabilities			(75,286	)			(67,314	)			(125,148	)
Depreciation and amortization*			204,289				149,904				693,595
Interest expense and other			122,129				114,619				99,442
Curtailments, settlements and early retirement incentives			14,293				4,032				(25,722	)
Union represented employee incentives			7,071				—				—
Income tax expense (benefit)			5,798				(5,426	)			(36,457	)
Adjusted EBITDA (non-GAAP measure)		$	297,827			$	196,590			$	211,060
Non-service defined benefit income (excluding settlements)			(56,187	)			(66,137	)			(77,512	)
Adjusted EBITDAP (non-GAAP measure)		$	241,640			$	130,453			$	133,548

*	Includes impairment charges related to intangible assets

	Fiscal year ended March 31,
	2016				2015				2014
(Loss) income from continuing operations	$	(1,047,960	)		$	238,697			$	206,256
Legal settlement charge (gain), net of expenses	5,476				(134,693		)		—
Amortization of acquired contract liabilities	(132,363		)		(75,733		)		(42,629		)
Depreciation and amortization *	1,052,116				158,323				164,277
Curtailments, settlements and early retirement incentives	(1,244		)		—				1,166
Interest expense and other	68,041				85,379				87,771
Income tax (benefit) expense	(111,187		)		110,597				105,977
Adjusted EBITDA	$	(167,121	)		$	382,570			$	522,818
* - Includes Impairment charges related to intangible assets

The following tables show our Adjusted EBITDAEBITDAP by reportable segment reconciled to our operating (loss) income for the indicated periods (in thousands):

	Fiscal year ended March 31, 2016
	Total				Aerostructures				Aerospace Systems				Aftermarket Services				Corporate/ Eliminations
Operating (loss) income	$	(1,091,106	)		$	(1,274,777	)		$	216,520			$	24,977			$	(57,826	)
Legal settlement charge, net	5,476				12,070				(8,494		)		1,900				—
Curtailments, settlements and early retirement incentives	(1,244		)		—				—				—				(1,244		)
Amortization of acquired contract liabilities	(132,363		)		(90,778		)		(41,585		)		—				—
Depreciation and amortization *	1,052,116				988,947				50,518				11,009				1,642
Adjusted EBITDA	$	(167,121	)		$	(364,538	)		$	216,959			$	37,886			$	(57,428	)
* - Includes Impairment impairment charges related to intangible assets.

	Fiscal year ended March 31, 2015
	Total				Aerostructures				Aerospace Systems				Aftermarket Services				Corporate/ Eliminations
Operating income	$	434,673			$	120,985			$	184,042			$	47,931			$	81,715
Legal settlement (gain), net	(134,693		)		—				—				—				(134,693		)
Amortization of acquired contract liabilities	(75,733		)		(38,719		)		(37,014		)		—				—
Depreciation and amortization	158,323				102,296				45,200				8,559				2,268
Adjusted EBITDA	$	382,570			$	184,562			$	192,228			$	56,490			$	(50,710	)

	Fiscal year ended March 31, 2014
	Total				Aerostructures				Aerospace Systems				Aftermarket Services				Corporate/ Eliminations
Operating income	$	400,004			$	248,637			$	149,721			$	42,265			$	(40,619	)
Curtailments, settlements and early retirement incentives	1,166				—				—				—				1,166
Amortization of acquired contract liabilities	(42,629		)		(25,207		)		(17,422		)		—				—
Depreciation and amortization	164,277				116,514				37,453				7,529				2,781
Adjusted EBITDA	$	522,818			$	339,944			$	169,752			$	49,794			$	(36,672	)

		Fiscal year ended March 31, 2020
		Total				Systems & Support				Aerospace Structures				Corporate/ Eliminations
Operating income (loss)		$	57,907			$	141,341			$	41,864			$	(125,298	)
Legal judgment gain, net of expenses			(9,257	)			—				—				(9,257	)
Loss (gain) on sale of assets and businesses			56,916				—				(10,121	)			67,037
Union represented employee incentives			7,071				—				7,071				—
Amortization of acquired contract liabilities			(75,286	)			(34,486	)			(40,800	)			—
Depreciation and amortization*			204,289				98,497				102,418				3,374
Adjusted EBITDAP		$	241,640			$	205,352			$	100,432			$	(64,144	)

		Fiscal year ended March 31, 2019
		Total				Systems & Support				Aerospace Structures				Corporate/ Eliminations
Operating (loss) income		$	(274,679	)		$	201,094			$	(152,407	)		$	(323,366	)
Loss on sale of assets and businesses			235,301				—				—				235,301
Adoption of ASU 2017-07			87,241				—				87,241				—
Amortization of acquired contract liabilities			(67,314	)			(34,121	)			(33,193	)			—
Depreciation and amortization			149,904				35,373				111,431				3,100
Adjusted EBITDAP		$	130,453			$	202,346			$	13,072			$	(84,965	)

		Fiscal year ended March 31, 2018
		Total				Systems & Support				Aerospace Structures				Corporate/ Eliminations
Operating (loss) income		$	(465,640	)		$	231,103			$	(568,164	)		$	(128,579	)
Loss on sale of assets and businesses			30,741				—				—				30,741
Amortization of acquired contract liabilities			(125,148	)			(38,293	)			(86,855	)			—
Depreciation and amortization*			693,595				42,730				649,013				1,852
Adjusted EBITDAP		$	133,548			$	235,540			$	(6,006	)		$	(95,986	)

*	Includes impairment charges related to intangible assets

The fluctuations from period to period within the amounts of the components of the reconciliations above are discussed further below within Results of Operations.

Fiscal year endedMarch 31, 20162020, compared towith fiscal year endedMarch 31, 20152019

		Year Ended March 31,
		2020				2019
		(in thousands)
Net sales		$	2,900,117			$	3,364,930
Segment operating income		$	183,205			$	48,687
Corporate expense			(125,298	)			(323,366	)
Total operating income (loss)			57,907				(274,679	)
Interest expense and other			122,129				114,619
Non-service defined benefit income			(41,894	)			(62,105	)
Income tax expense (benefit)			5,798				(5,426	)
Net loss		$	(28,126	)		$	(321,767	)

	Year Ended March 31,
	2016				2015
	(in thousands)
Net sales	$	3,886,072			$	3,888,722
Segment operating (loss) income	$	(1,033,280	)		$	352,958
Corporate (expense) income	(57,826		)		81,715
Total operating (loss) income	(1,091,106		)		434,673
Interest expense and other	68,041				85,379
Income tax (benefit) expense	(111,187		)		110,597
Net (loss) income	$	(1,047,960	)		$	238,697

Net sales decreased by $2.7$464.8 million,, or (0.1)%13.8%, to $3.9$2.90 billion for the fiscal year ended March 31, 2016,2020, from $3.9$3.36 billion for the fiscal year ended March 31, 2015. The acquisition of Fairchild and2019. Organic sales adjusted for inter-segment sales increased $140.5 million, or 5.2%, offset by declines from the fiscal 2015 acquisitions contributed $355.32019 divestitures and fiscal 2020 divestitures, including the Global 7500 transition, of $605.3 million. Organic sales decreased $352.7 million, or (9.8)%,increased primarily due to production rate cuts by our customers on the 747-8, V-22, G450/G550 and C-17 programs. The prior fiscal year was negatively impacted by our customers' decreased production rates on existingincreased volumes across Airbus commercial programs and decreasedvarious military sales.

In the fourth quarter of fiscal 2016, we recorded a $399.8 million forward loss charge for the Bombardier Global 7000/8000 wing program. Under our contract for this program, we have the right to design, develop and manufacture wing components over the initial 300 ship sets. The Global 7000/8000 contract provides for fixed pricing and requires us to fund certain up-front development expenses, with certain milestone payments made by Bombardier. The Global 7000/8000 program charge resulted in the impairment of previously capitalized pre-production costs due to the combination of cost recovery uncertainty, higher than anticipated non-recurring costs and increased forecasted costs on recurring production. The increases in costs were driven by several factors, including: changing technical requirements, increased spending on the design and engineering phase of the program and uncertainty regarding cost reduction and cost recovery initiatives with our customer and suppliers. Further cost increases or an inability to meet revised recurring cost forecasts on the Global 7000/8000 program may result in additional forward loss reserves in future periods, while improvements in future costs compared to current estimates may result in favorable adjustments if forward loss reserves are no longer required.

In January 2016, Boeing announced a rate reduction to the 747-8 program, which lowers production to one plane every two months. We have assessed the impact of the rate reduction and have recorded an additional $161.4 million forward loss. This announcement follows the September 2015 decision by Boeing to in-source production of the 747-8 program beginning in the second half of fiscal 2019, effectively terminating this program with us after our current contract. Additional costs associated with exiting the facilities where the 747-8 program is manufactured, such as asset impairment, supplier and lease termination charges,programs, as well as severanceaftermarket demand for military rotorcraft programs in Systems & Support, increased volumes on G550, 767, 787, G280, and retention paymentsM100 programs as well as increased volume and pricing on E-2 Jets sales to employeesASTK in Aerospace Structures, and contractors have been includedincreased demand for accessory components.  These increases were partially offset in the 2016 Restructuring Plan.

Recognition of additional forward losses in the future periods continues to be a risk and will depend upon several factors, including the impact of the above discussed production rate change, our ability to successfully perform under current design and manufacturing plans, achievement of forecasted cost reductions as we continue production, our ability to successfully resolve claims and assertions with our customers and suppliers and our customers' ability to sell their products.

decreased volumes on 737.

Cost of sales increaseddecreased by $455.8$617.5 million,, or 14.5%21.1%, to $3.6$2.31 billion for the fiscal year ended March 31, 2016,2020, from $3.1$2.92 billion for the fiscal year ended March 31, 2015. The acquisition of Fairchild and the fiscal 2015 acquisitions contributed $274.5 million. The organic2019. Organic cost of sales includedadjusted for inter-segment sales increased $26.3 million, or 1.2%, offset by declines from the fiscal 2019 divestitures and fiscal 2020 divestitures, including the Global 7500 transition, of $645.6 million. Organic cost of sales increased primarily due to the higher volumes in the above programs partially offset by the prior year forward loss provisions for forward lossesfrom the adoption of $561.2 million on the Bombardier and 747-8 programs (as discussed above).ASU 2017-07 of $87.2 million.  Organic gross margin for the fiscal year ended March 31, 2016,2020, was 3.9%20.8% compared with 19.1%17.6% for the fiscal year ended March 31, 2015.2019. The gross margin for the fiscal year ended March 31, 2020, increased compared with the prior year was impacted by additional costs onperiod due to the 747-8 program and disruption and accelerated depreciation associated withnonrecurring forward loss provisions from the relocation from our Jefferson Street Facilities.

adoption of ASU 2017-07.  

Gross margin included net unfavorable cumulative catch-up adjustments on long-term contracts and provisions for forward losses as noted above ($596.2 million). The unfavorable cumulative catch-up adjustments to operating income included gross

favorable adjustments of $33.0 million and gross unfavorable adjustments of $629.2 million, of which $561.2 million was related to forward losses associated with the Bombardier and 747-8 programs. Excluding the aforementioned forward losses, the cumulative catch-up adjustments for the fiscal year ended March 31, 2016, reflected increased labor and supplier costs on other programs. Gross margins for fiscal 2015 included net unfavorable cumulative catch-up adjustments of $156.0 million, of which $152.0 million was related to the forward losses on the 747-8 program.

Segment operating (loss) income decreased by $1,386.2 million, or (392.7)%, to $(1,033.3) million for the fiscal year ended March 31, 2016, from $353.0 million for the fiscal year ended March 31, 2015. The decreased operating income is directly related to the provisions for forward losses and gross margin changes noted above and the previously mentioned goodwill and tradename impairment charges.

Corporate operations incurred expenses of $57.8 million for the fiscal year ended March 31, 2016, as opposed to income of $81.7 million for the fiscal year ended March 31, 2015. The fiscal year ended March 31, 2015, included the legal settlement between the Company and Eaton, which resulted in a net gain of $134.7$22.8 million.

Interest expense and other decreased by $17.3 million, or 20.3%, to $68.0 million for the fiscal year ended March 31, 2016 compared to $85.4 million for the prior year. Interest expense and other for the fiscal year ended March 31, 2016, included foreign exchange losses of $2.4 million versus foreign exchange gains of $5.0 million for the fiscal year ended March 31, 2015. Interest expense and other for the fiscal year ended March 31, 2015 included the redemption of the 2018 Notes, which included $22.6 million for pre-tax losses associated with the 4.79% redemption premium, and write-off of the remaining related unamortized discount and deferred financing fees.

The effective income tax rate was 9.6% for the fiscal year ended March 31, 2016, and reflected the establishment of a valuation allowance of $155.8 million against net deferred tax assets. Based on an evaluation of both the positive and negative evidence available, we determined that it was necessary to establish a valuation allowance against substantially all of our net deferred tax assets for the fiscal year ended March 31, 2016.

A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. When determining the amount of net deferred tax assets that are more likely than not to be realized, the Company assesses all available positive and negative evidence. This evidence includes, but is not limited to, prior earnings history, expected future earnings, carry-back and carry-forward periods and the feasibility of ongoing tax strategies that could potentially enhance the likelihood of the realization of a deferred tax asset. The weight given to the positive and negative evidence is commensurate with the extent the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses.

Based on these criteria and the relative weighting of both the positive and negative evidence available, and in particular the activity surrounding the Company's prior earnings history, including the forward losses and intangible impairments previously recognized, management determined that it was necessary to establish a valuation allowance against principally all of its net deferred tax assets at March 31, 2016. Given the objectively verifiable negative evidence of a three-year cumulative loss and the weighting of all available positive evidence, the Company excluded projected taxable income (aside from reversing taxable temporary differences) from the assessment of income that could be used as a source of taxable income to realize the deferred tax assets.

The effective tax rate for the fiscal year ended March 31, 2015, was 31.7% and included the release of previously reserved for unrecognized tax benefits of $1.1 million, the benefit of $2.8 million from a decrease of the state deferred tax rate and the benefit of $6.0 million from the retroactive reinstatement of the R&D tax credit to January 1, 2014.

Fiscal year ended March 31, 2015 compared to fiscal year ended March 31, 2014

	Year Ended March 31,
	2015				2014
	(in thousands)
Net sales	$	3,888,722			$	3,763,254
Segment operating income	$	352,958			$	440,623
Corporate income (expenses)	81,715				(40,619		)
Total operating income	434,673				400,004
Interest expense and other	85,379				87,771
Income tax expense	110,597				105,977
Net income	$	238,697			$	206,256

Net sales increased by $125.5 million, or 3.3%, to $3.9 billion for the fiscal year ended March 31, 2015, from $3.8 billion for the fiscal year ended March 31, 2014. The fiscal 2015 and fiscal 2014 acquisitions, net of prior year divestitures, contributed $306.1 million. Organic sales decreased $180.6 million, or 4.6%, due to production rate cuts by our customers on the 747-8, V-22, G450/G550 and C-17 programs. The prior fiscal year was negatively impacted by our customers' decreased production rates on existing programs and decreased military sales.

Cost of sales increased by $229.7 million, or 7.9%, to $3.1 billion for the fiscal year ended March 31, 2015, from $2.9 billion for the fiscal year ended March 31, 2014. The fiscal 2015 and fiscal 2014 acquisitions, net of prior year divestitures, contributed $264.2 million. Despite the decrease in organic cost of sales, the organic cost of sales included a provision for forward losses of $152.0 million on the 747-8 program in addition to losses as a result of losing NADCAP certification at one of our facilities. Organic gross margin for the fiscal year ended March 31, 2015, was 20.1% compared with 23.1% for the fiscal year ended March 31, 2014. The prior year was impacted by additional programs costs on the 747-8 program and disruption and accelerated depreciation associated with the relocation from our Jefferson Street facilities. Excluding these charges, the comparable gross margin would have been 25.4% and 26.5%, respectively.

Gross margin included net unfavorable cumulative catch-up adjustments on long-term contracts and a provision for forward losses as noted above ($156.0 million). The unfavorable cumulative catch-up adjustments to operating income included gross favorable adjustments of $4.7$43.4 million and gross unfavorable adjustments of $160.7 million, of which $152.0 million was related to forward losses associated with the 747-8 program. The cumulative catch-up adjustments for the fiscal year ended March 31, 2015, were due primarily to labor cost growth, partially offset by other minor improvements.$66.2 million. Gross margins for fiscal 20142019 included net unfavorable cumulative catch-up adjustments of $53.2 million, which $29.8 million was related to the additional 747-8 program costs from reductions to profitability estimates on the 747-8 production lots that were completed during fiscal 2014 and $15.6 million of disruption and accelerated depreciation costs related to our exit from the Jefferson Street facilities which reduced profitability estimates on production lots completed during fiscal 2014. These decreases were partially offset by lower pension and other postretirement benefit expense of $12.7$68.7 million.

29

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Segment operating income decreasedincreased by $87.7$134.5 million, or 19.9%276.3%, to $353.0$183.2 million for the fiscal year ended March 31, 20152020, from $440.6$48.7 million for the fiscal year ended March 31, 2014. The organic2019. Organic segment operating income decreased $100.9increased by $45.1 million, or 22.6%31.7%, primarily due to the increased margins above as well as decreases in administrative compensation cost of $13.7 million and was a resultresearch and development of the decreased organic sales, the provision for forward losses and gross margin changes noted above,$8.5 million, were partially offset by decreased moving costs relateda $66.1 million goodwill impairment charge under Systems & Support.   The fiscal 2019 divestitures and fiscal 2020 divestitures contributed $89.4 million in increased operating income in the current year primarily due to incurring operating losses of the relocation from our Jefferson Street facilities ($28.1 million), and legal fees ($4.5 million).

fiscal year ended March 31, 2019.  

Corporate operations yielded incomeincurred expenses of $81.7$125.3 million for the fiscal year ended March 31, 2015,2020, as opposed to expenses of $40.6compared with $323.4 million for the fiscal year ended March 31, 2014. This result is due to2019. The corporate expenses included decreased loss on sale of assets and businesses of $168.3 million, decreased compensation cost of $12.3 million, with additional benefit from the legal settlement between the Company and Eaton, which created a netjudgment gain of $134.7 million, partially offset by increased due diligence and acquisition related expenses ($9.8 million).

$9.3 million.  

Interest expense and other decreasedincreased by $2.4$7.5 million, or 2.7%6.6%, to $85.4$122.1 million for the fiscal year ended March 31, 20152020, compared to $87.8with $114.6 million for the prior year. Interest expense and other for the fiscal year ended March 31, 2015 decreased2019, due to lower averagehigher interest rates and relative debt outstanding during the period as comparedlevels.

Non-service defined benefit income decreased by $20.2 million, or 32.5%, to the fiscal year ended March 31, 2014. Interest expense and other$41.9 million for the fiscal year ended March 31, 2015, included the redemption of the 2018 Notes, which included $22.62020, compared with $62.1 million for pre-tax losses associated with the 4.79% redemption premium, and write-off of the remaining related unamortized discount and deferred financing fees. The fiscal year ended March 31, 2014, included the redemption of the 2017 Notes, which included

$11.0 million of pre-tax losses associated with the 4% redemption premium, and the write-off of the remaining related unamortized discount and deferred financing fees.

The effective income tax rate was 31.7% for the fiscal year ended March 31, 2015,2019. The decrease was primarily due to additional expense in the current year from pension settlements, special termination benefits, and 33.9%curtailment losses of $63.8 million partially offset by a gain from curtailment of other post-employment benefits of $49.5 million, as well as changes in actuarial assumptions and experience which reduced income for fiscal year 2020 by $9.0 million.

The income tax expense was $5.8 million for the fiscal year ended March 31, 2014. The income2020, reflecting an effective tax provisionrate of (26.0)%.  During the fiscal year ended March 31, 2020, the Company adjusted the valuation allowance against the consolidated net deferred tax asset by $36.9 million primarily due to an increase in the net operating loss and changes to temporary differences related to pension and other postretirement benefit plans. As of March 31, 2020, management determined that it was necessary to maintain a valuation allowance against principally all of its net deferred tax assets.

Fiscal year endedMarch 31, 2019, compared with fiscal year endedMarch 31, 2018

		Year Ended March 31,
		2019				2018
		(in thousands)
Net sales		$	3,364,930			$	3,198,951
Segment operating income (loss)		$	48,687			$	(337,061	)
Corporate expenses			(323,366	)			(128,579	)
Total operating loss			(274,679	)			(465,640	)
Interest expense and other			114,619				99,442
Non-service defined benefit income			(62,105	)			(103,234	)
Income tax benefit			(5,426	)			(36,457	)
Net loss		$	(321,767	)		$	(425,391	)

Net sales increased by $166.0 million, or 5.2%, to $3.36 billion for the fiscal year ended March 31, 2015, was reduced to reflect the release of previously reserved2019, from $3.20 billion for unrecognized tax benefits of $1.1 million, the benefit of $2.8 million from a decrease of the state deferred tax rate and the benefit of $6.0 million from the retroactive reinstatement of the R&D tax credit to January 1, 2014. For the fiscal year ended March 31, 2014,2018.  Net sales increases included the production ramp on Global 7500 of $232.5 million prior to transition.  Organic sales adjusted for inter-segment sales increased $34.9 million, or 1.3%.  The fiscal 2018 divestitures and fiscal 2019 divestitures, excluding the Global 7500 transition contributed $101.4 million to the net sales decrease as compared with the prior fiscal year.  Organic sales increased primarily due to the rate increases on key commercial programs and higher volumes on military programs in Systems & Support as well as increased demand for structural component repair offset by decreased business jet sales from reduced scope of the G650 wing.

Cost of sales increased by $317.4 million, or 12.2%, to $2.92 billion for the fiscal year ended March 31, 2019, from $2.61 billion for the fiscal year ended March 31, 2018.  Net sales increases from the production ramp on Global 7500 contributed $343.9 million increase in cost of sales prior to transition, including $60.4 million in forward loss charges. Organic cost of sales adjusted for inter-segment sales increased $121.3 million or 4.6% and included additional forward loss provisions from the adoption of ASU 2017-07 of $87.2 million, as well as $29.1 million on the G280 wing program.  The fiscal 2018 divestitures and fiscal 2019 divestitures, excluding the Global 7500 transition contributed $94.8 million to the cost of sales variance compared with the prior fiscal year.  Organic gross margin for the fiscal year ended March 31, 2019, was 17.2% compared with 20.8% for the fiscal year ended March 31, 2018.  The gross margin for the fiscal year ended March 31, 2019, decreased compared with the comparable prior year period due to the additional forward loss provisions noted above.

Gross margin included net unfavorable cumulative catch-up adjustments on long-term contracts of $68.7 million.  The favorable cumulative catch-up adjustments to operating income included gross favorable adjustments of $46.1 million and gross unfavorable adjustments of $114.8 million.  Additionally, the adoption of ASU 2017-07 resulted in a change in estimates due to a change in accounting principles of $87.2 million.  Gross margins for fiscal 2018 included net favorable cumulative catch-up adjustments of $19.7 million.

30

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Segment operating income increased by $385.7 million, or 114.4%, to an operating income of $48.7 million for the fiscal year ended March 31, 2019, from $337.1 million of operating loss for the fiscal year ended March 31, 2018.  Organic operating income increased due to a prior year goodwill impairment charge of $535.2 million. The fiscal 2018 divestitures and fiscal 2019 divestitures contributed $16.7 million to an operating income decrease compared with the prior fiscal year.

Corporate operations incurred expenses of $323.4 million for the fiscal year ended March 31, 2019, as compared with $128.6 million for the fiscal year ended March 31, 2018. The corporate expenses included increased loss on divestitures of $204.6 million, partially offset by $13.0 million in decreased restructuring expenses.

Interest expense and other increased by $15.2 million, or 15.3%, to $114.6 million for the fiscal year ended March 31, 2019, compared with $99.4 million for the fiscal year ended March 31, 2018, due to higher interest rates and relative debt levels and the favorable net change in foreign exchange rate gain/loss of approximately $6.8 million compared with the prior year period.

Non-service defined benefit income decreased by $41.1 million, or 39.8%, to $62.1 million for the fiscal year ended March 31, 2019, compared with $103.2 million for the fiscal year ended March 31, 2018.  The decrease was primarily due to nonrecurring income recognized in fiscal year 2018 from a curtailment of other post-employment benefits of $26.3 million and changes in actuarial assumptions and experience which reduced income for fiscal year 2019 by $6.0 million.

The income tax provisionbenefit was reduced to reflect$5.4 million for the releasefiscal year ended March 31, 2019, reflecting an effective tax rate of previously reserved for unrecognized tax benefits of $0.7 million and additional research and development tax credit carryforward and NOL carryforward of $2.3 million.

In January 2014,1.7%.  During the fiscal year ended March 31, 2019, the Company soldadjusted the valuation allowance against the consolidated net deferred tax asset by $252,243 primarily due to an increase in the net operating loss and changes to temporary differences related to ASC 606.  As of March 31, 2019, management determined that it was necessary to maintain a valuation allowance against principally all of its shares of Triumph Aerospace Systems-Wichita, Inc. for total cash proceeds of $23.0 million, which resulted in no gain or loss from the sale.

In April 2013, the Company sold the assets and liabilities of Triumph Instruments-Burbank and Triumph Instruments-Ft. Lauderdale for total proceeds of $11.2 million, resulting in a loss of $1.5 million.

The Company expects to have significant continuing involvement in the businesses and markets of the disposed entities and therefore the disposal groups did not meet the criteria to be classified as discontinued operations.

net deferred tax assets.

Business Segment Performance

We report our financial performance based on the following threetwo reportable segments: the Aerostructures Group, theSystems & Support and Aerospace Systems Group and the Aftermarket Services Group.Structures. The Company's Chief Operating Decision Maker ("CODM") utilizes Adjusted EBITDAEBITDAP as a primary measure of profitability to evaluate performance of its segments and allocate resources.

The results of operations among our reportable segments vary due to differences in competitors, customers, extent of proprietary deliverables and performance. For example, our Aerostructures segment generally includes long-term sole-source or preferred supplier contracts and the success of these programs provides a strong foundation for our business and positions us well for future growth on new programs and new derivatives. This compares to our Aerospace Systems segment& Support, which generally includes proprietary products and/or arrangements where we become the primary source or one of a few primary sources to our customers, where our unique manufacturing capabilities command a higher margin. Also, OEMs are increasingly focusing on assembly activities while outsourcing more manufacturing and repair to third parties, and as a result, are less of a competitive force than in previous years. In contrast,This compares to Aerospace Structures, which generally includes long-term sole-source or preferred supplier contracts and the success of these programs provides a strong foundation for our Aftermarket Services segment provides MRO servicesbusiness and positions us well for future growth on componentsnew programs and accessories manufactured by third parties, with more diverse competition, including airlines, OEMsnew derivatives.

Refer to Item 1 for further details regarding the operations and other third-party service providers. In addition, variability in the timing and extentcapabilities of customer requests performed in the Aftermarket Services segment can provide for greater volatility and less predictability in revenue and earnings than that experienced in the Aerostructures and Aerospace Systemseach of our reportable segments.

The Aerostructures segment consists of the Company's operations that manufacture products primarily for the aerospace OEM market. The Aerostructures segment's revenues are derived from the design, manufacture, assembly and integration of both build-to-print and proprietary metallic and composite aerostructures and structural components, including aircraft wings, fuselage sections, tail assemblies, engine nacelles, flight control surfaces as well as helicopter cabins. Further, the segment's operations also design and manufacture composite assemblies for floor panels and environmental control system ducts. These products are sold to various aerospace OEMs on a global basis.

The Aerospace Systems segment consists of the Company's operations that also manufacture products primarily for the aerospace OEM market. The segment's operations design a wide range of proprietary and build-to-print components and engineer mechanical and electromechanical controls, such as hydraulic systems, main engine gearbox assemblies, engine control systems, accumulators, mechanical control cables, non-structural cockpit components and metal processing. These products are sold to various aerospace OEMs on a global basis.

The Aftermarket Services segment consists of the Company's operations that provide maintenance, repair and overhaul services to both commercial and military markets on components and accessories manufactured by third parties. Maintenance, repair and overhaul revenues are derived from services on auxiliary power units, airframe and engine accessories, including constant-speed drives, cabin compressors, starters and generators, and pneumatic drive units. In addition, the segment's operations repair and overhaul thrust reversers, nacelle components and flight control surfaces. The segment's operations also perform repair and overhaul services and supply spare parts for various types of gauges for a broad range of commercial airlines on a worldwide basis.

We currently generate a majority of our revenue from clients in the commercial aerospace industry, the military, the business jet industry and the regional airline industry. Our growth and financial results are largely dependent on continued

demand for our products and services from clients in these industries. If any of these industries experiences a downturn, our clients in these sectors may conduct less business with us. The following table summarizes our net sales by end market by business segment. The loss of one or more of our major customers or an economic downturn in the commercial airline or the military and defense markets could have a material adverse effect on our business.

		Year Ended March 31,
		2020				2019				2018
Systems & Support
Commercial aerospace			26.5	%			22.6	%			23.8	%
Military			15.0				12.2				11.5
Business Jets			2.3				1.9				1.7
Regional			1.5				1.4				1.5
Non-aviation			1.3				0.8				0.8
Total Integrated Systems net sales			46.6	%			38.9	%			39.3	%
Aerospace Structures
Commercial aerospace			30.3	%			30.4	%			33.9	%
Military			4.0				7.1				8.6
Business Jets			16.0				21.7				16.8
Regional			3.1				1.1				0.7
Non-aviation			0.0				0.8				0.7
Total Aerospace Structures net sales			53.4	%			61.1	%			60.7	%
Total Consolidated net sales			100.0	%			100.0	%			100.0	%

	Year Ended March 31,
	2016			2015			2014
Aerostructures
Commercial aerospace	35.6	%		38.5	%		42.4	%
Military	10.5			14.0			16.1
Business Jets	15.6			11.0			10.0
Regional	0.4			0.4			0.4
Non-aviation	0.1			0.4			0.5
Total Aerostructures net sales	62.2	%		64.3	%		69.4	%
Aerospace Systems
Commercial aerospace	14.6	%		13.2	%		8.4	%
Military	11.1			10.6			11.4
Business Jets	2.0			1.4			1.0
Regional	0.9			1.0			1.0
Non-aviation	1.3			1.7			1.3
Total Aerospace Systems net sales	29.9	%		27.9	%		23.1	%
Aftermarket Services
Commercial aerospace	6.0	%		6.3	%		6.3	%
Military	1.4			1.0			0.7
Regional	0.5			0.5			0.2
Non-aviation	—			—			0.3
Total Aftermarket Services net sales	7.9	%		7.8	%		7.5	%
Total Consolidated net sales	100.0	%		100.0	%		100.0	%

We continue to experience a higher proportion of our sales mix in the commercial aerospace end market. We recently havemarket across both of our segments due to the 737, 767/Tanker, 777, 787, A320, A321, and G650 programs.  Systems & Support has experienced an increase in our business jetits military end market due to the acquisition of the Tulsa Programsprimarily from volume on military rotorcraft, and Aerospace Structures has experienced a decrease in ourits military end market due to reduced volume in the wind-down of the C-17 program.

C-130 program and certain military rotorcraft.

Business Segment Performance—Fiscal year endedMarch 31, 20162020, compared towith fiscal year endedMarch 31, 20152019

		Year Ended March 31,								% Change				% of Total Sales
		2020				2019								2020				2019
		(in thousands)
NET SALES
Systems & Support		$	1,357,564			$	1,325,011				2.5	%			46.8	%			39.4	%
Aerospace Structures			1,555,887				2,062,404				(24.6	)%			53.7	%			61.3	%
Elimination of inter-segment sales			(13,334	)			(22,485	)			40.7	%			(0.5	)%			(0.7	)%
Total net sales		$	2,900,117			$	3,364,930				(13.8	)%			100.0	%			100.0	%

		Year Ended March 31,								% Change				% of Segment Sales
		2020				2019								2020				2019
		(in thousands)
SEGMENT OPERATING (LOSS) INCOME
Systems & Support		$	141,341			$	201,094				(29.7	)%			10.4	%			15.2	%
Aerospace Structures			41,864				(152,407	)			127.5	%			2.7	%			(7.4	)%
Corporate			(125,298	)			(323,366	)			61.3	%		n/a				n/a
Total segment operating (loss) income		$	57,907			$	(274,679	)			121.1	%			2.0	%			(8.2	)%

		Year Ended March 31,								% Change				% of Segment Sales
		2020				2019								2020				2019
		(in thousands)
Adjusted EBITDAP
Systems & Support		$	205,352			$	202,346				1.5	%			15.5	%			15.7	%
Aerospace Structures			100,432				13,072				668.3	%			6.6	%			0.6	%
Corporate			(64,144	)			(84,965	)			24.5	%		n/a				n/a
		$	241,640			$	130,453				85.2	%			8.6	%			4.0	%

		Year Ended March 31,								% Change			% of Total Sales
		2016				2015							2016			2015
		(in thousands)
NET SALES
Aerostructures		$	2,427,809			$	2,510,371			(3.3	)%		62.5	%		64.6	%
Aerospace Systems		1,166,795				1,089,117				7.1	%		30.0	%		28.0	%
Aftermarket Services		311,394				304,013				2.4	%		8.0	%		7.8	%
Elimination of inter-segment sales		(19,926		)		(14,779		)		34.8	%		(0.5	)%		(0.4	)%
Total net sales		$	3,886,072			$	3,888,722			(0.1	)%		100.0	%		100.0	%

		Year Ended March 31,								% Change			% of Segment Sales
		2016				2015							2016			2015
		(in thousands)
SEGMENT OPERATING INCOME
Aerostructures		$	(1,274,777	)		$	120,985			(1,153.7	)%		(52.5	)%		4.8	%
Aerospace Systems		216,520				184,042				17.6	%		18.6	%		16.9	%
Aftermarket Services		24,977				47,931				(47.9	)%		8.0	%		15.8	%
Corporate		(57,826		)		81,715				(170.8	)%		n/a			n/a
Total segment operating income		$	(1,091,106	)		$	434,673			(351.0	)%		(28.1	)%		11.2	%

		Year Ended March 31,								% Change			% of Segment Sales
		2016				2015							2016			2015
		(in thousands)
Adjusted EBITDA
Aerostructures		$	(364,538	)		$	184,562			(297.5	)%		(15.0	)%		7.4	%
Aerospace Systems		216,959				192,228				12.9	%		18.6	%		17.6	%
Aftermarket Services		37,886				56,490				(32.9	)%		12.2	%		18.6	%
Corporate		(57,428		)		(50,710		)		13.2	%		n/a			n/a
		$	(167,121	)		$	382,570			(143.7	)%		(4.3	)%		9.8	%

Aerostructures:    The Aerostructures segment

Systems & Support:     Systems & Support net sales decreasedincreased by $82.6$32.6 million, or 3.3%2.5%, to $2.4$1.36 billion for the fiscal year ended March 31, 2016,2020, from $2.5$1.33 billion for the fiscal year ended March 31, 2015.2019. Organic sales decreasedincreased by $326.7$63.3 million, or 13.5%4.9%, offset by declines of $30.8 million from the fiscal 2019 divestitures within Systems & Support.  Organic sales increased due to increased volumes on engine components, Airbus commercial programs, aftermarket demand for military rotorcraft components, and aftermarket spare part sales and accessory component repairs. These increases were partially offset by decreased production rate cuts by our customersvolumes on the 747-8, Gulfstream G450/G550, A330 and C-17 programs. The acquisition of the Tulsa Programs contributed $244.1 million to net sales.

Aerostructures737.  

Systems & Support cost of sales increased by $382.5$8.7 million,, or 17.4%0.9%, to $2.6 billion for the fiscal year ended March 31, 2016, from $2.2 billion for the fiscal year ended March 31, 2015. The acquisition of the Tulsa Programs contributed $200.6$960.5 million for the fiscal year ended March 31, 2016 and organic cost of sales increased by $200.62020, from $951.8 million or 9.5%. The organic cost of sales included provisions for forward losses of $561.2 million on the Bombardier and 747-8 programs (as discussed above). Excluding the aforementioned forward losses, the cumulative catch-up adjustments for the fiscal year ended March 31, 2016, included2019. Organic cost of sales increased labor and supplier costs on other programs. Theby $33.1 million, or 3.6%, offset by declines of $24.4 million from the fiscal year ended March 31, 2015, included a provision for forward losses of $152.0 million on the 747-8 program and losses as a result of losing NADCAP certification at one of our facilities.

2019 divestitures within Systems & Support.  Organic gross margin for the fiscal year ended March 31, 2016,2020, was (10.8)%29.3% compared with 12.4%28.3% for the fiscal year ended March 31, 2015.2019. Organic cost of sales increased due to the sales increase noted above and sales mix, partially offset by a reduction of cost of sales as a result of a $5.3 million reduction in acquired contract reserves, which also drove the increased gross margin for the fiscal year ended March 31, 2020.

Systems & Support operating income decreased by $59.8 million, or 29.7%, to $141.3 million for the fiscal year ended March 31, 2020, from $201.1 million for the fiscal year ended March 31, 2019. Organic operating income decreased by $57.2 million, or 28.8% primarily due to the goodwill impairment charge of $66.1 million and increased restructuring costs of $8.3 million, partially offset by decreased research and development costs of $5.9 million and the increased gross margin described above.  The fiscal 2019 divestitures resulted in $2.6 million in decreased operating income in the current year primarily due to operating income earned in the fiscal year ended March 31, 2019.

Systems & Support operating income as a percentage of segment sales decreased to 10.4% for the fiscal year ended March 31, 2020, as compared with 15.2% for the fiscal year ended March 31, 2019, due to the factors described above. These same factors contributed to the decrease in Adjusted EBITDAP margin year over year.

32

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Aerospace Structures:     Aerospace Structures net sales decreased by $506.5 million, or 24.6%, to $1.56 billion for the fiscal year ended March 31, 2020, from $2.06 billion for the fiscal year ended March 31, 2019.  Organic net sales increased by $68.0 million, offset by declines of $574.5 million from the fiscal 2019 and fiscal 2020 divestitures within Aerospace Structures.  Organic net sales increased due to increased volumes for the G280, G550, 767, and M100 programs, as well as increased volumes and pricing related to the E-2 Jets and 787 programs.  These increases were partially offset by decreased volumes on 737.  

Aerospace Structures cost of sales decreased by $637.2 million, or 31.9%, to $1.36 billion for the fiscal year ended March 31, 2020, from $2.00 billion for the fiscal year ended March 31, 2019. Organic cost of sales decreased by $16.0 million, with an additional reduction in cost of sales of $621.3 million from the fiscal 2019 and fiscal 2020 divestitures within Aerospace Structures.  Organic gross margin for the fiscal year ended March 31, 2020, was 13.0% compared with 7.7% for the fiscal year ended March 31, 2019.  The decrease in organic cost of sales is due to the nonrecurring forward loss provisions from the adoption of ASU 2017-07 in the year ended March 31, 2019, of $87.2 million and a reduction in unfavorable cumulative catch-up adjustments of $45.8 million partially offset by increases related to the increased net sales above.  The gross margin included net unfavorable cumulative catch-up adjustments and provisions for forward losses of $561.2 million.$22.9 million due in large part to the estimated effects of COVID-19. The net unfavorable cumulative catch-up adjustments included gross favorable adjustments of $33.0$43.3 million and gross unfavorable adjustments of $629.2 million, which includes forward losses of $561.2 million associated with the Bombardier and 747-8 programs.$66.2 million. The net unfavorable cumulative catch-up adjustment for the fiscal year ended March 31, 2015,2019, was $156.0$68.7 million.

Aerospace Structures operating income increased by $194.3 million, which included $152.0 million of forward losses related to the 747-8 program.

Aerostructures segment operating (loss) income decreased by $1,395.8 million, or 1,153.7%127.5%, to $(1,274.8)$41.9 million for the fiscal year ended March 31, 2016, from $121.0 million for the fiscal year ended March 31, 2015. The decreased operating income is directly related to the provision for forward losses and gross margin changes noted above and the previously mentioned goodwill and tradename impairment charges and included restructuring charges ($62.7 million). Additionally, the provision for forward losses and gross margin changes noted above contributed to the decrease in Adjusted EBITDA year over year.

Aerostructures segment operating income as a percentage of segment sales decreased to (52.5)% for the fiscal year ended March 31, 2016, as compared with 4.8%2020, from an operating loss of $152.4 million for the fiscal year ended March 31, 20152019. Organic operating income increased by $102.3 million, or 182.0%, due towith further increases resulting from the decrease in gross margin as discussed above, which also caused the decline in the Adjusted EBITDA margin.

fiscal 2019 and fiscal 2020 divestitures within Aerospace Systems:Structures of $92.0 million.  The Aerospace Systems segment net sales increased by $77.7 million, or 7.1%, to $1.17 billion organic operating income for the fiscal year ended March 31, 2016, from $1.09 billion for the fiscal year ended March 31, 2015. The acquisitions of Fairchild and GE contributed $93.5 million of net sales. Organic net sales decreased by $15.8 million, or 1.8%, primarily due to slower commercial rotocraft demand and lower aftermarket revenue.

Aerospace Systems cost of sales increased by $53.7 million, or 7.3%, to $792.2 million for the fiscal year ended March 31, 2016, from $738.5 million for the fiscal year ended March 31, 2015. Organic cost of sales decreased by $8.4 million, or 1.5%, while the acquisitions of Fairchild and GE contributed $62.7 million in cost of sales. Organic gross margin for the fiscal year ended March 31, 2016, 2020, was 34.2% compared with 34.4% for the fiscal year ended March 31, 2015.

Aerospace Systems segment operating income increased by $32.5 million, or 17.6%, to $216.5 million for the fiscal year ended March 31, 2016, from $184.0 million for the fiscal year ended March 31, 2015. Operating income increased primarily due to the acquisitionsincreased gross margin discussed above as well as lower administrative compensation due to decreased severance and headcount of Fairchild and GE ($22.5 million)approximately $18.8 million and the net favorable settlementapproximately $10.0 million gain recognized as a result of a contingent liability ($8.5 million), partially offset by restructuring charges ($4.6 million). These same factors contributedthe transfer of the E-2 Jets program to theASTK. The increase in Adjusted EBITDAEBITDAP year over year.

year is due to the same factors that increased operating income.

Aerospace Systems segmentStructures operating income as a percentage of segment sales increased to 18.6%2.7% for the fiscal year ended March 31, 2016,2020, as compared with 16.9%(7.4)% for the fiscal year ended March 31, 2015, 2019, due to the effects of the acquisitions of Fairchild and GE. The same factors contributed to the increase in Adjusted EBITDA margin year over year.

Aftermarket Services:    The Aftermarket Services segment net sales increased by $7.4 million, or 2.4%, to $311.4 million for the fiscal year ended March 31, 2016, from $304.0 million for the fiscal year ended March 31, 2015. Organic sales decreased $10.3 million, or 3.5%, and the acquisition of NAAS contributed $17.7 million. Organic sales decreased due to a decreased demand from commercial customers.

Aftermarket Services cost of sales increased by $23.6 million, or 10.7%, to $243.7 million for the fiscal year ended March 31, 2016, from $220.1 million for the fiscal year ended March 31, 2015. The organic cost of sales increased $12.5 million, or 5.9%, and the acquisition of NAAS contributed $11.1 million to cost of sales. Organic gross margin for the fiscal year ended March 31, 2016, was 20.2% compared with 27.3% for the fiscal year ended March 31, 2015. The decrease in gross margin was impacted by the impairment of excess and obsolete inventory associated with certain slow moving programs we have decided to no longer support ($21.1 million).

Aftermarket Services segment operating income decreased by $23.0 million, or 47.9%, to $25.0 million for the fiscal year ended March 31, 2016, from $47.9 million for the fiscal year ended March 31, 2015. Operating income decreased primarily due to the decreased organic sales and the decline in gross marginsas noted above. These same factors as noted above for the Adjusted EBITDAP contributed to the decrease inincreased Adjusted EBITDA year over year.

Aftermarket Services segment operating income as a percentage of segment sales decreased to 8.0% for the fiscal year ended March 31, 2016, as compared with 15.8% for the fiscal year ended March 31, 2015, due to the decreased organic sales and the decline in gross margins noted above. The same factors contributed to the decrease in Adjusted EBITDAEBITDAP margin year over year.

Business Segment Performance—Fiscal year endedMarch 31, 20152019, compared towith fiscal year endedMarch 31, 20142018

		Year Ended March 31,								% Change				% of Total Sales
		2019				2018								2019				2018
		(in thousands)
NET SALES
Systems & Support		$	1,325,011			$	1,267,508				4.5	%			39.4	%			39.6	%
Aerospace Structures			2,062,404				1,954,729				5.5	%			61.3	%			61.1	%
Elimination of inter-segment sales			(22,485	)			(23,286	)			3.4	%			(0.7	)%			(0.7	)%
Total net sales		$	3,364,930			$	3,198,951				5.2	%			100.0	%			100.0	%

		Year Ended March 31,								% Change				% of Segment Sales
		2019				2018								2019				2018
		(in thousands)
SEGMENT OPERATING INCOME (LOSS)
Systems & Support		$	201,094			$	231,103				(13.0	)%			15.2	%			18.2	%
Aerospace Structures			(152,407	)			(568,164	)			73.2	%			(7.4	)%			(29.1	)%
Corporate			(323,366	)			(128,579	)			(151.5	)%		n/a				n/a
Total segment operating income (loss)		$	(274,679	)		$	(465,640	)			41.0	%			(8.2	)%			(14.6	)%

		Year Ended March 31,								% Change				% of Segment Sales
		2019				2018								2019				2018
		(in thousands)
Adjusted EBITDAP
Systems & Support		$	202,346			$	235,540				(14.1	)%			15.7	%			19.2	%
Aerospace Structures			13,072				(6,006	)			317.7	%			0.6	%			(0.3	)%
Corporate			(84,965	)			(95,986	)			11.5	%		n/a				n/a
		$	130,453			$	133,548				(2.3	)%			4.0	%			4.3	%

		Year Ended March 31,								% Change			% of Total Sales
		2015				2014							2015			2014
		(in thousands)
NET SALES
Aerostructures		$	2,510,371			$	2,622,917			(4.3	)%		64.6	%		69.7	%
Aerospace Systems		1,089,117				871,750				24.9	%		28.0	%		23.2	%
Aftermarket Services		304,013				287,343				5.8	%		7.8	%		7.6	%
Elimination of inter-segment sales		(14,779		)		(18,756		)		(21.2	)%		(0.4	)%		(0.5	)%
Total net sales		$	3,888,722			$	3,763,254			3.3	%		100.0	%		100.0	%

		Year Ended March 31,								% Change		% of Segment Sales
		2015				2014						2015		2014
		(in thousands)
SEGMENT OPERATING INCOME
Aerostructures		$	120,985			$	248,637			(51.3)%		4.8%		9.5%
Aerospace Systems		184,042				149,721				22.9%		16.9%		17.2%
Aftermarket Services		47,931				42,265				13.4%		15.8%		14.7%
Corporate		81,715				(40,619		)		(301.2)%		n/a		n/a
Total segment operating income		$	434,673			$	400,004			8.7%		11.2%		10.6%

		Year Ended March 31,								% Change			% of Total Sales
		2015				2014							2015			2014
		(in thousands)
Adjusted EBITDA
Aerostructures		$	184,562			$	339,944			(45.7	)%		7.4	%		13.0	%
Aerospace Systems		192,228				169,752				13.2	%		17.6	%		19.5	%
Aftermarket Services		56,490				49,794				13.4	%		18.6	%		17.3	%
Corporate		(50,710		)		(36,672		)		38.3	%		n/a			n/a
		$	382,570			$	522,818			(26.8	)%		9.8	%		13.9	%

Aerostructures:    The Aerostructures segment

33

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Systems & Support:     Systems & Support net sales decreasedincreased by $112.6$57.5 million, or 4.3%4.5%, to $2.5$1.33 billion for the fiscal year ended March 31, 2015,2019, from $2.6$1.27 billion for the fiscal year ended March 31, 2014.2018. Organic sales decreasedincreased by $181.2$87.9 million, or 6.9%,7.3%.  The divestitures of NAAS, RPL, Embee, Engines and APU (“TSS divestures”) contributed ($30.4 million) to the acquisitions of the Tulsa Programs and Primus, net of prior year divestiture contributed $68.6 million in net sales.sales variance.  Organic sales decreasedincreased primarily due to production rate cuts by our customersincreases on the 747-8, V-22, G450/G550key commercial programs, higher volumes on certain military programs and C-17 programs.

Aerostructuresincreased demand in structural component repairs.

Systems & Support cost of sales increased by $60.9$86.3 million, or 2.9%10.0%, to $2.2 billion for the fiscal year ended March 31, 2015, from $2.1 billion for the fiscal year ended March 31, 2014. The fiscal 2015 and fiscal 2014 acquisitions, net of prior year divestiture, contributed $79.9 million. Despite the decrease in organic cost of sales, the organic cost of sales included a provision for forward losses of $152.0 million on the 747-8 program and losses as a result of losing NADCAP certification at one of our facilities, as discussed above. Excluding the aforementioned forward losses, the organic cost of sales decreased due to the decrease in net sales noted above. The cost of sales for the fiscal year ended March 31, 2014, included reductions in profitability estimates on the 747-8 programs, driven largely by the identification of additional program costs ($85.0 million) identified during the year and additional program costs resulting from disruption and accelerated depreciation associated with the relocation from our Jefferson Street facilities ($38.4 million).

Organic gross margin for the fiscal year ended March 31, 2015, was 13.7% compared with 18.9% for the fiscal year ended March 31, 2014. The organic gross margin included net unfavorable cumulative catch-up adjustments and a provision for forward losses of $152.0 million. The net unfavorable cumulative catch-up adjustments included gross favorable adjustments of $4.7 million and gross unfavorable adjustments of $160.7 million, which includes forward losses of $152.0 million associated with the 747-8 program. The cumulative catch-up adjustments for the fiscal year ended March 31, 2015, excluding the effects of the forward losses, were due primarily to labor cost growths, partially offset by other minor improvements. The net unfavorable cumulative catch-up adjustment for the fiscal year ended March 31, 2014, was $53.2 million, which included $29.8 million related to additional 747-8 program costs from reductions to profitability estimates on the 747-8 production lots that were completed during the fiscal year ended March 31, 2014, and $15.6 million of disruption and accelerated depreciation costs related to our exit from the Jefferson Street facilities which reduced profitability estimates on production lots completed during fiscal year ended March 31, 2014. Excluding these charges, the comparable gross margin would have been 21.0% and 23.8%, respectively.

Aerostructures segment operating income decreased by $127.7 million, or 51.3%, to $121.0$949.9 million for the fiscal year ended March 31, 2015,2019, from $248.6$863.6 million for the fiscal year ended March 31, 2014. Operating income was directly affected by the decrease in organic sales, the decreased organic gross margins noted above, offset by decreased moving costs related to

the relocation from our Jefferson Street facilities ($28.1 million). Additionally, these same factors contributed to the decrease in Adjusted EBITDA year over year.

Aerostructures segment operating income as a percentage of segment sales decreased to 4.8% for the fiscal year ended March 31, 2015, as compared with 9.5% for the fiscal year ended March 31, 2014, due to the decrease in sales and gross margin as discussed above, which also caused the decline in the Adjusted EBITDA margin.

Aerospace Systems:    The Aerospace Systems segment net sales increased by $217.4 million, or 24.9%, to $1.09 billion for the fiscal year ended March 31, 2015, from $871.8 million for the fiscal year ended March 31, 2014. The GE and General Donlee acquisitions contributed $225.4 million of net sales.2018.  Organic net sales decreased by $8.0 million, or 0.9%, primarily due to decreased production associated with the V-22 program.

Aerospace Systems cost of sales increased by $166.7$107.4 million, or 29.2%, to $738.5 million for the fiscal year ended March 31, 2015, from $571.8 million for the fiscal year ended March 31, 2014. Organic cost of sales decreased by $9.7 million, or 1.8%13.1%, while the acquisitions of GE and General Donleedivestitures contributed $176.5 million in cost of sales. Organic gross margin for the fiscal year ended March 31, 2015, was 35.3% compared with 34.7% for the fiscal year ended March 31, 2014 due to changes in sales mix.

Aerospace Systems segment operating income increased by $34.3 million, or 22.9%, to $184.0 million for the fiscal year ended March 31, 2015, from $149.7 million for the fiscal year ended March 31, 2014. Operating income increased primarily due to the acquisitions of GE and General Donlee and by decreased legal fees ($7.121.1 million). These same factors contributed to the increase in Adjusted EBITDA year over year.

Aerospace Systems segment operating income as a percentage of segment sales decreased to 16.9% for the fiscal year ended March 31, 2015, as compared with 17.2% for the fiscal year ended March 31, 2014, due to the effects of the acquisitions of GE and General Donlee. The same factors contributed to the decrease in Adjusted EBITDA margin year over year.

Aftermarket Services:    The Aftermarket Services segment net sales increased by $16.7 million, or 5.8%, to $304.0 million for the fiscal year ended March 31, 2015, from $287.3 million for the fiscal year ended March 31, 2014. Organic sales increased by $4.6 million, or 1.6%, and the acquisition of NAAS offset by the previously divested Triumph Instruments companies contributed $12.1 million.

Aftermarket Services cost of sales increased by $6.2 million, or 2.9%, to $220.1 million for the fiscal year ended March 31, 2015, from $213.9 million for the fiscal year ended March 31, 2014. The organic cost of sales decreased by $1.7 million, or 0.8%, and the acquisition of NAAS net of the previously divested Triumph Instruments companies contributed $7.9 million reduction to cost of sales.  Organic gross margin for the fiscal year ended March 31, 2015,2019, was 27.3%28.5% compared with 25.6%32.2% for the fiscal year ended March 31, 2014.2018.  The increasedecrease in gross margin was impacted byfor the increase in efficiencies in production associated withfiscal year ended March 31, 2019, is the result of sales mix, the higher volumecosts incurred to drive future operational improvements noted above, increased costs on a development program, learning curves on new repair programs and a favorable settlement of work.

Aftermarket Services segmentcustomer assertions in the comparable prior period.

Systems & Support operating income increaseddecreased by $5.7$30.0 million, or 13.4%13.0%, to $47.9$201.1 million for the fiscal year ended March 31, 2015,2019, from $42.3$231.1 million for the fiscal year ended March 31, 2014. Operating2018.  Organic operating income increased primarilydecreased ($26.6 million), or (11.8)%, while divestitures contributed ($3.4 million) to operating income in the prior year period.

Organic operating income decreased due to the increased sales anddecreased gross margin noted above and the acquisitionincreased restructuring expenses of NAAS net of the previously divested Triumph Instruments companies ($1.6 million).$5.3 million. These same factors contributed to the increasedecrease in Adjusted EBITDAEBITDAP year over year.

Aftermarket Services segment

Systems & Support operating income as a percentage of segment sales increaseddecreased to 15.8%15.2% for the fiscal year ended March 31, 2015,2019, as compared with 14.7%18.2% for the fiscal year ended March 31, 2014,2018, due to the improved gross margin noted above.

Liquidity and Capital Resources

Our working capital needs are generally funded through cash flow from operations and borrowings under our credit arrangements. Duringincreases. These same factors contributed to the decrease in Adjusted EBITDAP margin year over year.

Aerospace Structures:     Aerospace Structures net sales increased by $107.7 million, or 5.5%, to $2.06 billion for the fiscal year ended March 31, 2016, we generated approximately $83.92019, from $1.95 billion for the fiscal year ended March 31, 2018.  Net sales increases included the production ramp on Global 7500 of $232.5 million prior to transition.  Organic net sales decreased $54.8 million due to declines in business jet, primarily on our change in scope on the G650 program.  The fiscal 2019 Aerospace Structures divestitures, excluding the Global 7500 transition contributed $71.1 million to the net sales variance.

Aerospace Structures cost of cash flowsales increased by $232.0 million, or 13.1%, to $2.00 billion for the fiscal year ended March 31, 2019, from operating activities, used approximately $128.0$1.77 billion for the fiscal year ended March 31, 2018.  The cost of sales increase was driven by the increased sales and included additional forward loss provisions from the adoption of ASU 2017-07 of $87.2 million, in investing activitiesas well as from the Bombardier Global 7500 program of $60.4 million prior to transition and received approximately $32.5$29.1 million in financing activities.on the G280 wing program.

Gross margin for the fiscal year ended March 31, 2019, was 3.1% compared with 9.7% for the fiscal year ended March 31, 2018.  The decreased gross margin is due to additional forward loss charges noted above. In fiscal 2015, cash flowsaddition to the forward loss provision from operating activitiesthe adoption of ASU 2017-07 noted above, the gross margin included pension contributionsnet unfavorable cumulative catch-up adjustments of $112.3$68.7 million.

For  The net unfavorable cumulative catch-up adjustments included gross favorable adjustments of $46.1 million and gross unfavorable adjustments of $114.8 million.  The net unfavorable cumulative catch-up adjustment for the fiscal year ended March 31, 2016, we had a net cash inflow of $83.9was $19.7 million.

Aerospace Structures operating loss decreased by $415.8 million, from operating activities, a decrease of $383.5 million, comparedor 73.2%, to a net cash inflow of $467.3$152.4 million for the fiscal year ended March 31, 2015. During2019, from a loss of $568.2 million for the fiscal 2016,year ended March 31, 2018. The decreased operating loss for the net cash provided by operating activities was primarily attributable to the timing of payments on accounts payable and other accrued expenses ($251.5 million) driven by pre-production costs and net spending on the Tulsa Programs discussed below, offset by increased receipts from customers and others related to increased collection efforts ($40.9 million). During fiscal 2015, the net increase in cash provided by operating activities was primarilyyear ended March 31, 2019, is due to the aforementioned goodwill impairment charge of $535.2 million in the prior year period, partially offset by the additional forward loss charges noted above.  The Adjusted EBITDAP is adjusted for the adoption of ASU 2017-07 and increased for the fiscal year ended March 31, 2019, due to the increased sales.

Aerospace Structures operating loss as a percentage of segment sales improved to 7.4% for the fiscal year ended March 31, 2019, as compared with 29.1% for the fiscal year ended March 31, 2018, due to the goodwill impairment charge in the prior year period discussed above.  The Adjusted EBITDAP margin improvement was also affected by the increased sales noted above.

Liquidity and Capital Resources

For the fiscal year ended March 31, 2020, we had a net cash receivedinflow of $96.7 million from operating activities, an increase of $271.1 million, compared with a legal settlement ($134.7 million), and an income tax refund ($26.0 million).

net cash outflow of $174.4 million for the fiscal year ended March 31, 2019. We continue to investliquidated approximately $89.0 million in prior period customer advances against current period deliveries.  During the fiscal year ended March 31, 2019, we invested in inventory for new programs which impactsto support ramping and existing programs.  

In March 2020, in response to anticipated headwinds resulting from the impact of COVID-19 on the aerospace industry, including the impact on global air travel, we implemented certain cost reduction actions to improve our financial health, align capacity with expected demand, and ensure our long-term competitiveness.  This has included the reduction of overhead and indirect staff and temporary workers and the selective implementation of furloughs across our business to reduce costs while delivering on customer commitments. When combined with reductions in travel, corporate events, and other expenses, Triumph expects annual savings to operating cash flows operating activities. Duringof approximately $120.0 million beginning in fiscal 20162021, although there can be no assurance that we will achieve such synergy in the anticipated amounts and timeline.  Unrelated to COVID-19, the Company currently expects certain material cash outflows related to the completion of certain previously announced consolidation and shutdown costs with sunsetting programs within Aerospace Structures.  

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Cash flows provided by investing activities for the fiscal year ended March 31, 2020, decreased $193.2 million from the fiscal year ended March 31, 2019. Cash flows provided by investing activities for the fiscal year ended March 31, 2020, included cash from the fiscal 2020 sales of assets and businesses of $47.2 million offset by capital expenditures for inventory costs on new programs, excluding progress payments, including the Bombardier Global 7000/8000 and the Embraer E-Jet programs, were $146.1 million and $83.8 million, respectively. Net spend on the Tulsa Programs during fiscal 2016 was approximately $57.3of $39.8 million. Additionally, inventory for mature programs declined due to decreased production rates, by approximately $67.8 million. Unliquidated progress payments netted against inventory decreased $66.8 million due to timing of receipts.

Cash flows used in investing activities for the fiscal year ended March 31, 2016, decreased $60.1 million2019, included cash from the fiscal year ended March 31, 2015. Cash flows used in investing activities for the fiscal year ended March 31, 2016, included the acquisition2019 divestitures of Fairchild ($57.1 million), and a payment to settle a working capital adjustment related to the acquisition of GE ($6.0 million) and$247.6 million offset by capital expenditures ($80.0 million). Cash flows used in investing activities for the fiscal year ended March 31, 2015 included the cash received from the acquisition of the Tulsa Programs ($160.0 million) offset by the acquisitions of GE ($65.0 million) and NAAS ($43.7 million) and the working capital finalization of the acquisition of Primus ($13.0 million).

$47.1 million.

Cash flows provided by financing activities for the fiscal year ended March 31, 2016,2020, were $32.5$293.7 million, compared towith cash flows used inprovided by financing activities for the fiscal year ended March 31, 2015,2019, of $395.2$32.5 million. Cash flows provided by financing activities for the fiscal year ended March 31, 2016,2020, included additional borrowingsthe issuance of our Senior Secured Notes due 2024 of $525.0 million, offset by repayment of the Senior Notes due 2021 of $375.0 million, and payment of financing fees of approximately $17.7 million.  Additionally, the Company drew on ourits Credit Facility (as defined below), bringing the outstanding balance as of March 31, 2020, to fund$400.0 million.  This was done as part of a comprehensive precautionary approach to increase the acquisitionCompany’s cash position and maximize its financial flexibility, in light of Fairchildthe current volatility in the global markets resulting from the COVID-19 pandemic.  We have since repaid approximately $200.0 million of the borrowings, and cash continues to fund operations.be used to repay the borrowings through an automated cash sweep mechanism implemented with our lenders. Cash flows used inprovided by financing activities for the fiscal year ended March 31, 2015,2019, included the redemption of the 2018 Notes, settlement of the Convertible Senior Subordinated Notes ("Convertible Notes") redemptions and the purchase of our common stock ($184.4 million), offset by the issuance of the 2022 Notes.

additional borrowings to fund operations.

As of March 31, 2016, $834.32020, we had $485.5 million of cash on hand and $70.3 million was available under the Company's existing credit agreement ("Credit(the "Credit Facility").  On March 31, 2016, an aggregate amount of2020, approximately $140.0 million in outstanding borrowing and approximately $25.7$22.3 million in letters of credit were outstanding under the Credit Facility, all of which were accruing interest at LIBOR plus applicable basis points totaling 2.00%approximately 3.50% per annum. Amounts repaid under the Credit Facility may be reborrowed.

On March 28, 2016, we entered into a Purchase Agreement ("Receivables Purchase Agreement") to sell certain accounts receivables to a financial institution without recourse.

We are taking a number of actions to improve liquidity. In March 2020, we suspended the servicerdeclaration and/or payment of dividends until further notice. We have furloughed certain employees and recently announced reductions in force which we have implemented in the accounts receivablefirst quarter of fiscal 2021. We are reducing discretionary spending as well as reducing or deferring research and development and capital expenditures. We are also working with our customers and supply chain to accelerate receipts and conserve cash. We are also deferring certain employer payroll tax payments pursuant to the Coronavirus Aid, Relief, and Economic Security (CARES) Act. We expect to take advantage of additional programs if passed by the federal government.

We believe, based on an assessment of current market conditions, that cash flows from operations and borrowings under the Receivables Purchase Agreement. As of March 31, 2016,Amended Credit Agreement will be sufficient to meet anticipated cash requirements for our current operations for at least the maximum amount availablenext 12 months. We are evaluating additional funding options from the U.S. government via the U.S. Treasury and various Federal Reserve programs. We are also considering various divestiture opportunities that should provide liquidity. However, the COVID-19 crisis is constraining the credit and capital markets and our ability to access credit and capital markets may be reduced. In the event that the overall aviation market experiences delayed recoveries and divesture opportunities do not occur, the availability under the Receivables PurchaseAmended Credit Agreement was $90.0 million. Interest rates are basedmay change or be fully utilized and additional funding sources may be needed. There can be no assurance that such funding sources will be available to us on LIBOR plus 0.65% -0.70%. Asterms favorable to us, if at all. We may also seek transactions to extend the maturity of March 31, 2016,our indebtedness, reduce leverage, decrease interest expense or obtain covenant flexibility. Such transactions could include one or more repurchases or exchanges of our outstanding indebtedness. These transactions could increase our total amount of secured indebtedness or be dilutive to stockholders. There can be no assurances if or when we sold $89.9 million worth of eligible accounts receivable.

will consummate any such transactions or the timing thereof.

In November 2014,December 2019, the Company amended its receivable securitization facility (the “Securitization Facility”"Securitization Facility"), increasing decreasing the purchase limit from $175.0$125.0 million to $225.0$75.0 million and extendingextended the term through November 2017.

In May 2014, the Company amended its existing Credit Facility with its lenders to (i) to increase the maximum amount allowed forDecember 2022. At March 31, 2020, there was $75.0 million outstanding under our Securitization Facility. Interest rates on the Securitization Facility are based on prevailing market rates for short-term commercial paper, plus a program fee and (ii) amend certaina commitment fee. The Securitization Facility's net availability is not affected by the borrowing capacity of the Amended Credit Agreement.

The 5.25% Senior Notes due June 1, 2022 (the “2022 Notes”), the 6.250% Senior Secured Notes due September 15, 2024 (the “2024 Notes”), and the 7.750% Senior Notes due August 15, 2025 (the “2025 Notes”) (collectively, the "Senior Notes") are the Company's senior unsecured obligations and rank equally in right of payment with all of its other termsexisting and covenants.

In November 2013,future senior unsecured indebtedness and senior in right of payment to all of its existing and future subordinated indebtedness. The Senior Notes are guaranteed on a full, joint and several basis by each of the Guarantor Subsidiaries.

Pursuant to the documentation governing the Senior Notes, the Company amended the Credit Facility withmay redeem some or all of its lendersSenior Notes prior to (i) provide for a $375.0 million Term Loan with a maturity date of May 14, 2019, (ii) maintain a Revolving Line of Credit under the Credit Facilitytheir stated maturities, subject to $1,000.0 million and increase the accordion feature to $250.0 million, and (iii) amend certain other terms and covenants. The amendment resulted in a more favorable pricing grid and a more streamlined package of covenants and restrictions.

The level of unused borrowing capacity under the Company's Revolving Credit Facility varies from time to time depending in part upon its compliance with financial and other covenantslimitations set forth in the related agreement.indenture governing the applicable Senior Notes and, in certain cases, subject to significant prepayment premiums; however, the Amended Credit Agreement restricts us from doing so. The Company is obligated to offer to repurchase the Senior Notes at specified prices as a result of certain change-of-control events and a sale of all or substantially all of its assets. These restrictions and prohibitions are subject to certain qualifications and exceptions.

The indentures governing the Senior Notes, as well as the Amended Credit Agreement and Securitization Facility, contains certain affirmativecontain covenants and negative covenants, including limitations on specified levels of indebtedness to earnings before interest, taxes, depreciation and amortization, and interest coverage requirements, and includes limitations on,restrictions that, among other things, limit the Company's ability and the ability of any of the Guarantor Subsidiaries to (i) grant liens mergers, consolidations,on its assets; (ii) make dividend payments, other distributions or other restricted payments; (iii) incur restrictions on the ability of the Guarantor Subsidiaries to pay dividends or make other payments or investments; (iv) enter into sale and leaseback transactions; (v) merge, consolidate, transfer or dispose of substantially all of their assets; (vi) incur additional indebtedness; (vii) use the proceeds from sales of assets, paymentincluding capital stock of dividendsrestricted subsidiaries (in the case of the Senior Notes); and incurrence of debt. As of March 31, 2016, the

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(viii) enter into transactions with affiliates. The Company wasis currently in compliance with all such covenants.

In June 2014, the Company issued the 2022 Notes for $300.0 million in principal amount. The 2022 Notes were sold at 100% of principal amount and have an effective yield of 5.25%. Interest on the 2022 Notes is payable semiannually in cash in arrears on June 1 and December 1 of each year. We used the net proceeds to redeem the 2018 Notes and pay related fees and expenses. In connection with the issuance of the 2022 Notes, the Company incurred approximately $5.0 million of costs, which were deferred and are being amortized on the effective interest method over the term of the notes.

In February 2013, the Company issued the 2021 Notes for $375.0 million in principal amount. The 2021 Notes were sold at 100% of principal amount and have an effective interest yield of 4.875%. Interest on the 2021 Notes is payable semiannually in cash in arrears on April 1 and October 1 of each year. We used the net proceeds to repay borrowingsfinancial covenants under our

Credit Facility and pay related fees and expenses, and for general corporate purposes. In connection with the issuance of the 2021 Notes, the Company incurred approximately $6.3 million of costs, which were deferred and are being amortized on the effective interest method over the term of the notes.

its debt documents.

For further information on the Company's long-term debt, see Note 1010.

On May 22, 2020, the Company and its subsidiary co-borrowers and guarantors entered into an Twelfth Amendment to the Credit Agreement with the Administrative Agent and the Lenders party thereto. Among other things, the Twelfth Amendment (i) limits the amount of "Notescash in the United States the Company can hold on its balance sheet to Consolidated Financial Statements".$50.0 million, (ii) authorizes the sale of any Specified TAS Business Unit (as defined in the Amended Credit Agreement); (iii) provides for a reserve against the availability of up to 75% of the proceeds of Specified Asset Sales; and (iv) modifies certain financial covenants and other terms over the quarterly periods ending June 2020 through March 2022.  Refer to Item 1 – Recent Developments for further details regarding the Twelfth Amendment.

On September 23, 2019, the Company issued $525.0 million principal amount of 6.250% Senior Secured Notes due September 15, 2024.  The 2024 Notes are guaranteed on a full, senior secured, joint and several basis by each of the Company’s domestic restricted subsidiaries that is a borrower under the Company’s Credit Facility or that guarantees any of the Company’s debt or that of any of the Company’s domestic restricted subsidiaries under the Company’s Credit Facility and in the future by any of the Company’s domestic restricted subsidiaries that are borrowers under any credit facility or that guarantee any debt of the Company or any of its domestic restricted subsidiaries incurred under any credit facility. Under certain circumstances, the guarantees may be released without action by, or the consent of, the holders of the 2024 Notes.

The 2022 Notes and 2025 Notes are the Company’s senior unsecured obligations and rank equally in right of payment with all of its other existing and future senior unsecured indebtedness and senior in right of payment to all of its existing and future subordinated indebtedness. The 2021 Notes and 2025 Notes are guaranteed on a full, joint and several basis by each of the Company’s existing and future domestic restricted subsidiaries that is a borrower under any of the Company’s credit facilities or that guarantees any of the Company’s debt or that of any of its restricted subsidiaries, in each case incurred under any of the Company’s credit facilities.

The only consolidated subsidiaries of the Company that are not guarantors of the 2022 Notes, the 2024 Notes and the 2025 Notes (the "Non-Guarantor Subsidiaries") are: (i) the receivables securitization special purpose entity, and (ii) the foreign operating subsidiaries.

The 2024 Notes and the guarantees are secured, subject to permitted liens, by second-priority liens on all assets of the Company and its subsidiary guarantors (the “Collateral”) that secure all of the indebtedness under the Company’s Credit Facility and certain hedging and cash management obligations. The 2024 Notes and the guarantees are not secured by the assets of Non-Guarantor Subsidiaries. Some of the Company’s assets are excluded from the Collateral, including the Company’s real property assets.

		As of and for the fiscal year ended
Parent and Guarantor Summarized Financial Information		March 31, 2020
Current assets		$	1,177,461
Noncurrent assets			1,248,525
Current liabilities			920,414
Noncurrent liabilities			2,514,760
Due to/from Non-Guarantor Subsidiaries			14,624
Net sales			2,572,806
Gross profit			520,096
Loss from continuing operations			(50,842	)
Net loss			(54,048	)

For the fiscal year ended March 31, 2015,2019, we had a net cash inflowoutflow of $467.3$174.4 million from operating activities, an inflow increasea decrease of $332.2$114.5 million, compared towith a net cash inflowoutflow of $135.1$288.9 million for the fiscal year ended March 31, 2014. During fiscal 2015, the increase in net cash provided by operating activities was primarily due to the cash received from legal settlement ($134.7 million), increased receipts from customers and others relating to additional sales from fiscal 2015 and fiscal 2014 acquisitions ($110.4 million), an income tax refund ($26.0 million), and decreased disbursements to employees, suppliers and others ($114.9 million) due to timing, offset by increased pension contributions ($66.0 million).

2018. We invested in inventory and contract assets for new programs and additional production costs for ramp-up activities in support of increasing build rates on several programs and build ahead for the relocationwhich impacts our cash flows from our largest facilities. During fiscal 2015, inventory build for capitalized pre-production costsoperating activities. Cash flows used on new programs includingincluded approximately $230.0 million and $16.0 million pertaining to the Bombardier Global 7000/80007500 program, through the date of transition in February 2019, and the Embraer E-Jet, programs, were $127.0respectively. The Company received approximately $125.0 million and $48.7in customer advances. In addition, the Company liquidated approximately $177.0 million respectively. Offsetting this inventory build wasof prior period advances against current period deliveries. The Company also received approximately $20 million to settle an indemnification receivable initially recognized related to a provisionspecific matter that we acquired from the seller.

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Cash flows provided by investing activities for forward losses on our long-term contract on the 747-8 programfiscal year ended March 31, 2019, increased $162.3 million from the fiscal year ended March 31, 2018. Cash flows provided by investing activities for the fiscal year ended March 31, 2019, included cash from the fiscal 2019 divestitures of $152.0$247.6 million offset by capital expenditures of $47.1 million. Unliquidated progress payments netted against inventory increased $24.9 million due to timing of receipts. Capitalized pre-production costs are expected to continue to increase, while our production is expected to remain consistent over the next few quarters.

Cash flows used in investing activities for the fiscal year ended March 31, 2015, decreased by $178.8 million2018, included cash from the fiscal year ended March 31, 2014. Cash flows used in investing activities included the cash received from the acquisition2018 divestitures of Tulsa Programs ($160.0 million)$83.1 million, offset by the acquisitions of GE ($65.0 million) and NAAS ($43.7 million) and the working capital finalization of the acquisition of Primus ($13.0 million). The fiscal year ended March 31, 2014, included the fiscal 2014 acquisitions of $94.5 million and capital expenditures of $86.6 million associated with our new facilities in Red Oak, Texas.

Cash flows used in financing activities for the fiscal year ended March 31, 2015, were $395.2 million, compared to cash flows provided by financing activities for the fiscal year ended March 31, 2014, of $103.2$42.1 million. Cash flows used in financing activities for the fiscal year ended March 31, 2015, included the redemption of the 2018 Notes, settlement of the Convertible Senior Subordinated Notes ("Convertible Notes") redemptions and the purchase of our common stock ($184.4 million), offset by the issuance of the 2022 Notes.

At March 31, 2016, $19.2 million of cash and cash equivalents were held by foreign subsidiaries and were primarily denominated in foreign currencies. If these amounts would be remitted as dividends, the Company may be subject to additional U.S. taxes, net of allowable foreign tax credits. We currently expect to utilize the balances to fund our foreign operations.

Subsequent to year end, to ensure that we had full access to our Revolving Credit Facility (the "Credit Facility") during fiscal 2017, we obtained approval from the holders of the 2021 Notes to amend the terms of the indenture to conform with the 2022 Notes which allows for a higher level of secured debt. Absent this consent, we would have been restricted as to the level of new borrowings under the Credit Facility during fiscal 2017.

Further, to mitigate the risk of failing to obtain the consent and to ensure we had adequate liquidity through fiscal 2017, we chose to make a significant draw on the Credit Facility in early April 2016, taking the outstanding balance to approximately $800,000. We paid down substantially all of the draw to the Credit Facility upon receiving consent from the holders of the 2021 Notes in May 2016.

In May 2016, the Company entered into a Sixth Amendment to the Third Amended and Restated Credit Agreement, among the Company, the Subsidiary Co-Borrowers, the lenders party thereto and the Administrative Agent (the “Sixth Amendment” and the Credit Facility, as amended by the Sixth Amendment, the “Credit Agreement”), pursuant to which those lenders electing to enter into the Sixth Amendment extended the expiration date for the revolving line of credit and the maturity date for the term loan by five years to May 3, 2021. Lenders holding revolving credit commitments aggregating $940.0 million elected to extend the expiration date for the revolving line of credit, and Lenders holding approximately $324.5 million of term loans (out of an aggregate outstanding term loan balance of approximately $330.0 million) elected to extend the term loan maturity date.

In addition, the Sixth Amendment amended the Credit Facility to, among other things, (i) modify certain financial covenants to allow for the add-back of certain cash and non-cash charges, (ii) amend the total leverage ratio financial covenant to provide for a gradual reduction in the maximum permitted total leverage ratio commencing with the fiscal year ending March 31, 2018, (iii) increase the interest rate, commitment fee and letter of credit fee pricing provisions for the highest pricing tier, (iv) establish the interest rate, commitment fee and letter of credit fee pricing at the highest pricing tier until the Company

delivers its compliance certificate for its fiscal year ending March 31, 2017, (v) increase the minimum revolver availability threshold test in connection with the Company making certain permitted investments, certain additional permitted dividends, permitted acquisitions and permitted payments of certain types of indebtedness, and (vi) decrease the maximum senior secured leverage ratio threshold test in connection with the Company making certain permitted investments, certain permitted dividends, permitted acquisitions and permitted payments of certain types of indebtedness during the period from the date of the Sixth Amendment until the Company delivers its compliance certificate for the fiscal year ending March 31, 2017.

Capital expenditures were $80.0 million for the fiscal year ended March 31, 2016. We funded these expenditures through cash from operations and borrowings under the Credit Facility. We expect capital expenditures of approximately $80.0 million to $100.0 million and net investments in new major programs of $50.0 million to $60.0 million of which will be reflected in inventory for our fiscal year ending March 31, 2017. The expenditures are expected to be used mainly to expand capacity or replace old equipment at several facilities.

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

	Payments Due by Period																				Payments Due by Period
Contractual Obligations	Total				Less than 1 Year				1 - 3 Years				4 - 5 Years				After 5 Years				Total				Less than 1 Year				1 - 3 Years				4 - 5 Years				After 5 Years
	(in thousands)																				(in thousands)
Debt principal	$	1,426,116			$	42,383			$	430,042			$	273,409			$	680,282			$	1,823,933			$	7,336			$	381,611			$	927,216			$	507,770
Debt-interest(1)	233,121				46,071				91,767				77,167				18,116
Debt interest(1)																						469,489				110,386				191,996				147,009				20,098
Operating leases	168,305				27,904				46,218				33,643				60,540					84,983				16,843				25,595				15,353				27,192
Purchase obligations	1,965,090				1,457,022				471,967				35,215				886					1,374,122				950,626				390,305				15,128				18,064
Total	$	3,792,632			$	1,573,380			$	1,039,994			$	419,434			$	759,824				3,752,527				1,085,191				989,506				1,104,706				573,124

(1)
(1)	Includes fixed-rate interest only.

The above table excludes unrecognized tax benefits of $9.7$19.1 million as of March 31, 2016,2020, since we cannot predict with reasonable certainty the timing of cash settlements with the respective taxing authorities.

In addition to the financial obligations detailed in the table above, we also had obligations related to our benefit plans at March 31, 2016,2020, as detailed in the following table. Our other postretirement benefits are not required to be funded in advance, so benefit payments are paid as they are incurred. Our expected net contributions and payments are included in the table below:

		Pension Benefits				Other Postretirement Benefits
		(in thousands)
Projected benefit obligation at March 31, 2020		$	2,254,985			$	7,150
Plan assets at March 31, 2020			1,598,045				—
Projected contributions by fiscal year
2021			—				4,824
2022			81,800				813
2023			90,600				182
2024			85,800				171
2025			70,100				162
Total 2021 - 2025		$	328,300			$	6,152

	Pension Benefits				Other Postretirement Benefits
	(in thousands)
Projected benefit obligation at March 31, 2016	$	2,430,315			$	179,901
Plan assets at March 31, 2016	1,925,685				—
Projected contributions by fiscal year
2017	40,000				16,547
2018	40,000				15,973
2019	—				15,550
2020	—				14,953
2021	—				14,432
Total 2017 - 2021	$	80,000			$	77,455

Current plan documents reserve our right to amend or terminate the plans at any time, subject to applicable collective bargaining requirements for represented employees.

We believe that cash generated by operations and borrowings under the Credit Facility will be sufficient to meet anticipated cash requirements for our current operations for the foreseeable future.

Loans under the Credit Facility bear interest, at the Company's option, by reference to a base rate or a rate based on LIBOR, in either case plus an applicable margin determined quarterly based on the Company's Total Leverage Ratio (as defined in the Credit Facility) as of the last day of each fiscal quarter. The Company is also required to pay a quarterly commitment fee on the average daily unused portion of the Credit Facility for each fiscal quarter and fees in connection with the issuance of letters of credit. All outstanding principal and interest under the Credit Facility will be due and payable on the maturity date.

The Credit Facility contains representations, warranties, events of default and covenants customary for financings of this type including, without limitation, financial covenants under which the Company is obligated to maintain on a consolidated basis, as of the end of each fiscal quarter, a certain minimum Interest Coverage Ratio, maximum Total Leverage Ratio and maximum Senior Leverage Ratio (in each case as defined in the Credit Facility).

CRITICAL ACCOUNTING POLICIES

AND ESTIMATES

Critical accounting policies are those accounting policies that can have a significant impact on the presentation of our financial condition and results of operations, and that require the use of complex and subjective estimates based upon past experience and management's judgment. Because of the uncertainty inherent in such estimates, actual results may differ from these estimates. Below are those policies applied in preparing our consolidated financial statements that management believes are the most dependent on the application of estimates and assumptions. For additional accounting policies, see Note 2 of "Notes to Consolidated Financial Statements."

Allowance

Revenue Recognition and Contract Balances

The Company’s accounting policy regarding revenue recognition is disclosed in Note 2 to the consolidated financial statements.  As described in Note 2, for Doubtful Accountscertain contracts and performance obligations, the Company is required to exercise judgment when developing assumptions regarding expected total costs to fulfill performance obligations, variable consideration, and the standalone selling price of a performance obligation.  These assumptions are most significant within the Company’s Aerospace Structures business segment because the size and long-term nature of its contracts with customers.  Specifically, assumptions regarding the total costs require significant judgment with regard to materials, labor, and overhead costs that are affected by the Company’s ability to achieve technical requirements and schedule requirements, as well as the Company’s estimation of internal and subcontractor performance projections, anticipated volume, asset utilization, labor agreements, and inflation trends.  The Company continually reviews and update its assumptions based on market trends and experience. Material changes in assumptions may result in positive or negative cumulative catch-up adjustments related to revenues previously recognized or, in some cases, forward loss contract reserves.

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Goodwill and Intangible Assets

Refer to Note 2 and Note 7 for details on our goodwill and intangible asset accounting policies.  We test goodwill for impairment on an annual basis during the fourth quarter or whenever events or circumstances change between annual tests that could more likely than not reduce the fair value of a reporting unit below its carrying amount.  When such events or circumstances are identified, the Company performs a quantitative test to assess whether goodwill is impaired.  

When applying the quantitative approach to testing goodwill for impairment, we determine fair value for reporting units using a combination of the income approach and the market approach, applying appropriate weighting based on events and circumstances existing at the valuation date.

Valuations using the market approach are derived from metrics of publicly traded companies. We consider risk profiles, size, geography, and diversity of products and services when selecting comparable businesses in the markets in which our reporting units operate. The market approach is only used when there are publicly traded companies that have the characteristics similar to our businesses.

Under the income approach, fair value is determined based on the present value of estimated future cash flows, discounted at an appropriate risk-adjusted rate. We use our internal forecasts to estimate future cash flows and include an estimate of long-term future growth rates based on our most recent views of the long-term outlook for each business. Actual results may differ from those assumed in our forecasts. The discount rate applied to the cash flows is based upon a market-derived weighted average cost of capital (“WACC”) that takes into account the required rate of return for both debt and equity investors. We use discount rates that are commensurate with the risks and uncertainty inherent in the respective businesses and in our internally developed forecasts. Discount rates used in our annual reporting unit valuations ranged from 14.5% to 16.0%.

Estimating the fair value of reporting units requires the exercise of judgment to develop various assumptions used in the valuation approaches.  The most significant area of judgment pertains to the development of our internal forecasts regarding future operating results.  Internal forecasts and other key assumptions used to estimate the fair value of reporting units are based on judgments that consider actual operating results, market observable pricing multiples of similar businesses and comparable transactions, possible control premiums, determining the appropriate discount rate and long-term growth rate assumptions, and, if multiple approaches are being used, determining the appropriate weighting applied to each approach. It is reasonably possible that the judgments and estimates described above could change in future periods.

We review identified intangible assets with definite lives and subject to amortization for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Determining whether an impairment loss has occurred requires the use of our internal forecast to estimate future cash flows and the useful life over which these cash flows will occur.

As disclosed in Note 7, as of March 31, 2020, Aerospace Structures had goodwill of $1.2 billion which was fully impaired during fiscal year 2018.  In the year ended March 31, 2020, Systems & Support recognized a goodwill impairment charge of $66.1 million.  

Postretirement Plans

Certain of our current and former employees participate in defined benefit pension and other postretirement defined benefit plans (collectively, referred to as “defined benefit plans”) in the United States, Canada, and the United Kingdom, which are sponsored by the Company. The determination of projected benefit obligations and the recognition of expenses related to defined benefit pension plans are dependent on various assumptions. The most significant of these assumptions are the discount rates and the long-term expected rates of return on plan assets. Actual results that differ from our assumptions are accumulated and amortized for each plan to the extent required over the estimated future life expectancy of plan participants.

Significant Assumptions

We develop assumptions using relevant experience, in conjunction with market-related data for each plan. Assumptions are reviewed annually with third party consultants and adjusted as appropriate. Refer to Note 15 for details regarding the assumptions used to estimate projected benefit obligations and net periodic benefit cost as they pertain to our defined benefit pension plans.  

Expected Return on Plan Assets

We determine our expected return on plan assets by evaluating both historical returns and estimates of future returns. Specifically, we consider the plan’s actual historical annual return on assets and historical broad market returns over long-term time frames based on our strategic allocation, which is detailed in Note 15. Future returns are based on independent estimates of long-term asset class returns. Based on this approach, the weighted average long-term expected annual rate of return on assets was estimated at 7.94% for fiscal year 2020.

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Discount Rate

The discount rate is used to calculate the present value of expected future benefit payments at the measurement date. A decrease in the discount rate increases the present value of benefit obligations and generally decreases pension expense. The discount rate assumption is based on current investment yields of high-quality fixed income investments during the retirement benefits maturity period. The pension discount rate is determined by considering an interest rate yield curve comprising AAA/AA bonds, with maturities between zero and thirty years, developed by the plan’s actuaries. Annual benefit payments are then discounted to present value using this yield curve to develop a single discount rate matching the plan’s characteristics.  The discount rate assumption will change from measurement date to measurement date as market yields on high quality corporate bonds change.

Sensitivity Analysis

Pension Expense

A 25 basis point change in each of the long-term expected rate of return on plan assets and discount rate would have the following effect on the combined U.S. defined benefit pension plans’ pension income for the next 12 months:

		Increase/(Decrease) in Pension Income
		25 Basis Point Increase				25 Basis Point Decrease
		(In thousands)
Expected long-term rate of return on plan assets		$	4,167			$	(4,167	)
Discount rate		$	(104	)		$	235

Projected Benefit Obligation

Funded status is derived by subtracting the respective year-end values of the projected benefit obligations (“PBO”) from the fair value of plan assets. The sensitivity of the PBO to changes in the discount rate varies depending on the magnitude and direction of the change in the discount rate. Refer to Note 12 for a quantitative sensitivity analysis for the PBO.

Income Tax

The Company follows Accounting Standards Codification (“ASC”) ASC 740, Income Taxes, which prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, as well as guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

We recognize deferred tax assets and liabilities based on the differences between the financial statement basis and the tax basis of assets, liabilities, net operating losses and tax carryforwards. A valuation allowance is required to be recognized to reduce the recorded deferred tax asset to the amount that will more likely than not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income by jurisdiction during the periods in which those temporary differences become deductible or when carryforwards can be utilized. We consider the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in this assessment. As of March 31, 2020, we have a valuation allowance against substantially all of our net deferred tax assets given the insufficient positive evidence to support the realization of our deferred tax assets.  A reduction in the valuation allowance could result in a significant decrease in income tax expense in the period that the reduction is recorded.  However, the exact timing and amount of the reduction in our valuation allowance are unknown at this time and will be subject to the earnings level we achieve as well as our projected income in future periods.

Recently Issued Accounting Pronouncements

Refer to Note 2 for disclosure of the effects of recently issued accounting guidance.

Item 7A.Quantitative and Qualitative Disclosures About Market Risk

Commodity Price Risk

Some contracts with our suppliers for raw materials, component parts and other goods are short-term contracts, which are subject to termination on a relatively short-term basis. The prices of our raw materials and component parts fluctuate depending on market conditions, and substantial increases in prices could increase our operating costs, which, as a result of our fixed-price contracts, we may not be able to recoup through increases in the prices of our products. We generally do not employ forward contracts or other financial instruments to hedge commodity price risk, although we continue to review a full range of business options focused on strategic risk management for all material commodities.

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Any failure by our suppliers to provide acceptable raw materials, components, kits or subassemblies could adversely affect our production schedules and contract profitability. We assess qualification of suppliers and continually monitor them to control risk associated with such supply base reliance.

To a lesser extent, we also are exposed to fluctuations in the prices of certain utilities and services, such as electricity, natural gas, chemicals and freight. We utilize a range of long-term agreements to minimize procurement expense and supply risk in these areas.

Foreign Exchange Risk

In addition, even when revenues and expenses are matched, we must translate foreign denominated results of operations, assets and liabilities for our foreign subsidiaries to U.S. dollars in our consolidated financial statements. Consequently, increases and decreases in the value of the U.S. dollar as compared with the respective foreign currencies will affect our reported results of operations and the value of our assets and liabilities on our consolidated balance sheets, even if our results of operations or the value of those assets and liabilities has not changed in its original currency. These transactions could significantly affect the comparability of our results between financial periods and/or result in significant changes to the carrying value of our assets, liabilities and stockholders' equity.

We are subject to foreign currency exchange rate risk relating to receipts from customers and payments to suppliers in foreign currencies. We use foreign currency forward contracts to hedge the price risk associated with forecasted foreign denominated payments related to our ongoing business. Foreign currency forward contracts are sensitive to changes in foreign currency exchange rates. At March 31, 2020, a 10% change in the exchange rate in our portfolio of foreign currency contracts would not have material impact on our unrealized gains. Consistent with the use of these contracts to neutralize the effect of exchange rate fluctuations, such unrealized losses or gains would be offset by corresponding gains or losses, respectively, in the remeasurement of the underlying transactions being hedged. When taken together, these forward currency contracts and the offsetting underlying commitments do not create material market risk.

Interest Rate Risk

Our primary exposure to market risk consists of changes in interest rates on borrowings. An increase in interest rates would adversely affect our 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 our ability to pay dividends on our common stock, if permitted to do so under certain of our debt arrangements, including the Amended Credit Agreement. We manage exposure to interest rate fluctuations by optimizing the use of fixed and variable rate debt. As of March 31, 2020, approximately 74% of our debt was fixed-rate debt. Our financing policy states that we generally maintain between 50% and 75% of our debt as fixed-rate debt on a fully leveraged basis. The information below summarizes our market risks associated with debt obligations and should be read in conjunction with Note 10 of notes to consolidated financial statements.

The following table presents principal cash flows and the related interest rates. Fixed interest rates disclosed represent the weighted average rate as of March 31, 2020. Variable interest rates disclosed fluctuate with the LIBOR, federal funds rates, and other weekly rates and represent the weighted average rate at March 31, 2020.

Expected Years of Maturity

		Next 12 Months				13 - 24 Months				25 - 36 Months				37 - 48 Months				49 - 60 Months				Thereafter				Total
Fixed rate cash flows (in thousands)		$	7,336			$	4,659			$	301,952			$	1,486			$	525,730			$	507,770			$	1,348,933
Weighted average interest rate (%)			6.58	%			5.71	%			6.10	%			6.98	%			7.23	%			7.92	%
Variable rate cash flows (in thousands)		$	—			$	—			$	75,000			$	400,000			$	—			$	—			$	475,000
Weighted average interest rate (%)			4.61	%			4.61	%			4.69	%			4.97	%			—	%			—	%

There are no other significant market risk exposures.

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Item 8.Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Triumph Group, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Triumph Group, Inc. (“the Company”) as of March 31, 2020 and 2019, the related consolidated statements of operations, comprehensive loss, stockholders' (deficit) equity and cash flows for each of the three years in the period ended March 31, 2020, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at March 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2020, in conformity with U.S. generally accepted accounting principles.

We also have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of March 31, 2020, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated May 28, 2020, expressed an unqualified opinion thereon.

Adoption of New Accounting Standards

As discussed in Note 2 to the consolidated financial statements, the Company changed its method for accounting for revenue in the year ended March 31, 2019.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Revenue Recognition for Performance Obligations Satisfied Over Time

Description of the Matter		As described in Notes 2 and 4 of the consolidated financial statements, the Company’s Aerospace Structures reportable segment recognizes revenue for performance obligations that are satisfied over time using an input method with revenue recognized proportionately as costs are incurred relative to the total expected costs to satisfy the performance obligation (“estimate-at-completion”). This method of revenue recognition requires management to continuously update estimate-at-completion costs, changes to which affect the amount of profit and loss recognized each period. During fiscal year 2020, approximately $1.4 billion of the revenue for Aerospace Structures represent revenues from performance obligations that have been satisfied over time.

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		Auditing the revenue recognition for performance obligations satisfied over time within the Aerospace Structures reportable segment, including its estimate-at-completion analyses, was especially challenging due to the significant judgment involved in evaluating the key assumptions, including materials, labor and overhead costs, made by management in its estimates of the total expected costs to satisfy the performance obligations. The estimate-at-completion analyses and resultant forecasted profit or loss of each performance obligation are sensitive to assumptions surrounding the Company’s ability to achieve the technical requirements, schedule requirements, internal and subcontractor performance projections, anticipated business volume, anticipated asset utilization, and anticipated labor agreements, as well as the accuracy of estimated inflation trends, each of which can materially change the key cost assumptions.
How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process to recognize revenue for performance obligations that are satisfied over time within the Aerospace Structures reportable segment.  In particular, we tested controls over management’s review of the key assumptions in the estimate-at-completion analyses, which are describe above.  We also tested management’s controls over the completeness and accuracy of the data used in the estimate-at-completion analyses. To test the recognition of revenue for performance obligations that are satisfied over time within the Aerospace Structures reportable segment, our audit procedures included, among others, evaluating the key assumptions used to develop the estimate-at-completion analyses and the completeness and accuracy of the underlying data used in management’s calculations.  For example, we compared estimated costs to satisfy performance obligations in the estimate-at-completion analyses to historical results and source documentation including supplier agreements, current and projected labor rates, expected inflation rates, as well as overhead costs including rent expense and depreciation of long-lived assets. We recalculated the revenue recognized and resulting profit or loss based on actual costs and estimate-at-completion assumptions. When testing the significant assumptions, we involved our engineering specialists to assist in evaluating key judgments including cost projections related to management’s determination of estimate-at-completion costs.  In addition, we assessed the accuracy of the Company's historical estimates by comparing them to actual costs incurred. When there was a significant change in estimate, we inspected underlying evidence for the reason for the change in the estimate and the timing of the change in estimate.

Realizability of Deferred Tax Assets

Description of the Matter		As described in Note 12 of the consolidated financial statements, at March 31, 2020 the Company had deferred tax assets for deductible temporary differences and tax attributes of $162 million (net of a $439 million valuation allowance). Deferred tax assets are reduced by a valuation allowance if, based upon the weight of all available evidence, it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. Auditing the Company’s analysis of the realizability of its deferred tax assets required complex auditor judgment because the amounts are material to the financial statements and the assessment process involves significant judgment to apply changes in the tax law, determine the future reversal pattern of existing taxable temporary differences and other assumptions of future taxable income that may be affected by future market or economic conditions.
How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls that address the risks of material misstatement relating to the realizability of deferred tax assets.  This included controls over management’s evaluation and application of the effects of changes in the tax law and the scheduling of the future reversal pattern of existing taxable temporary differences that have been identified as a source of future taxable income. To test the Company’s assessment of the realizability of deferred tax assets and the resulting valuation allowance, our audit procedures included, among others, testing the Company’s calculation of future taxable income from the reversal of existing temporary taxable differences and evaluating the scheduling of the reversal patterns. In addition, we compared taxable income in prior carryback years, if any, to the Company’s income tax returns; considered the feasibility of tax planning strategies; and, evaluated projected future taxable income exclusive of reversing temporary differences and carryforwards. We involved our tax professionals to assist in evaluating the application of tax law, including any changes in the tax law, in the Company’s consideration of the sources of future taxable income.

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Defined Benefit Pension and Other Postretirement Benefit Obligations

Description of the Matter		At March 31, 2020, the Company’s aggregate defined benefit pension and other postretirement benefit obligation was $2.3 billion and the net periodic benefit income was $39 million.  As described in Note 15 of the consolidated financial statements, the Company updates the estimates used to measure the defined benefit pension obligation and plan assets in the fourth quarter and upon a remeasurement event to reflect the actual return on plan assets and updated actuarial assumptions. The Company had a remeasurement event in the second quarter of fiscal year 2020. Auditing the defined benefit pension and other postretirement benefit obligations and the related net periodic benefit income required complex auditor judgment and technical expertise due to the highly judgmental nature of the actuarial assumptions (e.g., discount rate, mortality rate, expected return on plan assets) used in the measurement process.  These assumptions had a significant effect on the projected benefit obligation and the net periodic benefit income. Further, the accounting guidance for remeasurement events, including plan amendments, curtailments, and special termination benefits was complex and required significant judgment.
How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over management’s determination of the defined benefit pension and other post-retirement benefit obligation calculations, the significant actuarial assumptions described  above and the data inputs provided to the Company’s actuarial specialists, as well as management’s evaluation of the relevant authoritative accounting literature to recognize the effects of plan amendments, curtailments and special termination benefits. To test the defined benefit pension and other postretirement benefit obligation, and the related net periodic benefit income, our audit procedures included, among others, evaluating the methodology used, the significant actuarial assumptions described above, the underlying data used by management and its actuaries and the appropriateness of management’s judgments in applying the authoritative accounting literature.  We compared the actuarial assumptions used by management with historical trends and evaluated the change in the defined benefit pension and other postretirement obligation from prior year resulting from the change in service cost, interest cost, benefit payments, actuarial gains and losses, participant contributions, special termination benefits and plan amendments. In addition, we involved our actuarial specialists to assist in evaluating management’s methodology for determining the actuarial assumptions. For example, we evaluated management’s methodology for determining the discount rate that reflects the maturity and duration of the benefit payments and is used to measure the defined benefit pension obligation.  As part of this assessment, we compared the projected defined benefit pension and other postretirement obligation cash flows with prior year amounts and compared the current year benefits paid to the prior year projected cash flows.  To evaluate the mortality rate, we assessed whether the information is consistent with publicly available information, and whether any market data adjusted for entity-specific adjustments were applied. We also tested the completeness and accuracy of the underlying data, including the participant data provided to the Company’s actuarial specialists.  Lastly, to evaluate the expected return on plan assets, we assessed whether management’s assumptions were consistent with a range of returns for a portfolio of comparative investments.

We have served as the Company’s auditor since 1993.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania

May 28, 2020

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TRIUMPH GROUP, INC.

Consolidated Balance Sheets

(Dollars in thousands, except per share data)

		March 31,
		2020				2019
ASSETS
Current assets:
Cash and cash equivalents		$	485,463			$	92,807
Trade and other receivables, less allowance for doubtful accounts    of $4,293 and $3,646			359,487				373,590
Contract assets			244,417				326,667
Inventory, net			452,976				413,560
Prepaid expenses and other current assets			19,289				34,446
Total current assets			1,561,632				1,241,070	��
Property and equipment, net			418,141				543,710
Goodwill			513,527				583,225
Intangible assets, net			381,968				430,954
Other, net			105,065				55,615
Total assets		$	2,980,333			$	2,854,574
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Current portion of long-term debt		$	7,336			$	8,201
Accounts payable			457,694				433,783
Contract liabilities			295,320				293,719
Accrued expenses			227,403				239,572
Total current liabilities			987,753				975,275
Long-term debt, less current portion			1,800,171				1,480,620
Accrued pension and other postretirement benefits			660,065				540,479
Deferred income taxes			7,439				6,964
Other noncurrent liabilities			306,169				424,549
Stockholders' deficit:
Common stock, $.001 par value, 100,000,000 shares authorized, 52,460,920    and 52,460,920 shares issued; 51,858,089 and 49,887,268    shares outstanding			52				52
Capital in excess of par value			804,830				867,545
Treasury stock, at cost, 602,831 and 2,573,652 shares			(36,217	)			(159,154	)
Accumulated other comprehensive loss			(719,428	)			(487,684	)
Accumulated deficit			(830,501	)			(794,072	)
Total stockholders' deficit			(781,264	)			(573,313	)
Total liabilities and stockholders' deficit		$	2,980,333			$	2,854,574

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

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TRIUMPH GROUP, INC.

Consolidated Statements of Operations

(In thousands, except per share data)

		Year ended March 31,
		2020				2019				2018
Net sales		$	2,900,117			$	3,364,930			$	3,198,951
Operating costs and expenses:
Cost of sales (exclusive of depreciation shown separately below)			2,307,393				2,924,920				2,607,556
Selling, general and administrative			257,529				298,386				292,630
Depreciation and amortization			138,168				149,904				158,368
Legal judgment gain, net of expenses			(9,257	)			—				—
Impairment of goodwill			66,121				—				535,227
Restructuring			25,340				31,098				40,069
Loss on sale of assets and businesses			56,916				235,301				30,741
			2,842,210				3,639,609				3,664,591
Operating income (loss)			57,907				(274,679	)			(465,640	)
Non-service defined benefit income			(41,894	)			(62,105	)			(103,234	)
Interest expense and other, net			122,129				114,619				99,442
Loss from continuing operations before income taxes			(22,328	)			(327,193	)			(461,848	)
Income tax expense (benefit)			5,798				(5,426	)			(36,457	)
Net loss		$	(28,126	)		$	(321,767	)		$	(425,391	)
Loss per share—basic:
Net loss		$	(0.56	)		$	(6.47	)		$	(8.60	)
Weighted average common shares outstanding—basic			50,494				49,698				49,442
Loss per share—diluted:
Net loss		$	(0.56	)		$	(6.47	)		$	(8.60	)
Weighted average common shares outstanding—diluted			50,494				49,698				49,442

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

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TRIUMPH GROUP, INC.

Consolidated Statements of Comprehensive Loss

(in thousands)

		Year ended March 31,
		2020				2019				2018
Net loss		$	(28,126	)		$	(321,767	)		$	(425,391	)
Other comprehensive (loss) income:
Foreign currency translation adjustment			(13,439	)			10,077				28,529
Defined benefit pension plans and other postretirement benefits:
Amounts arising during the period - net of tax (expense) benefit
Prior service credit (cost), net of taxes of $0, $0, and $0, respectively			94,182				(1,139	)			21,980
Actuarial (loss) gain, net of taxes of $0, $0, and $(283), respectively			(304,324	)			(125,540	)			10,306
Reclassification to net loss - net of expense (benefit)
Amortization of net loss, net of taxes of $0, $(656), and $(5), respectively			49,290				6,314				7,147
Recognized prior service credits, net of taxes of $0, $0, and $0, respectively			(54,280	)			(8,274	)			(37,623	)
Total defined benefit pension plans and other postretirement benefits, net    of taxes			(215,132	)			(128,639	)			1,810
Cash flow hedges:
Unrealized (loss) gain arising during the period, net of tax benefit of $0, $(228), and $(25), respectively			(1,611	)			30				133
Reclassification of loss included in net earnings, net of tax expense of $0, $228, and $14, respectively			(1,562	)			(1,282	)			(2,164	)
Net unrealized loss on cash flow hedges, net of tax			(3,173	)			(1,252	)			(2,031	)
Total other comprehensive (loss) income			(231,744	)			(119,814	)			28,308
Total comprehensive loss		$	(259,870	)		$	(441,581	)		$	(397,083	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

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TRIUMPH GROUP, INC.

Consolidated Statements of Stockholders' (Deficit) Equity

(Dollars in thousands)

		Outstanding Shares				Common Stock All Classes				Capital in Excess of Par Value				Treasury Stock				Accumulated Other Comprehensive Loss				Retained Earnings (Accumulated Deficit)				Total
March 31, 2017			49,573,029			$	51			$	846,807			$	(183,696	)		$	(396,178	)		$	579,489			$	846,473
Net loss			—				—				—				—				—				(425,391	)			(425,391	)
Foreign currency translation    adjustment			—				—				—				—				28,529				—				28,529
Pension liability adjustment, net of    income taxes of ($288)			—				—				—				—				1,810				—				1,810
Change in fair value of derivatives			—				—				—				—				(2,013	)			—				(2,013	)
Change in fair value of foreign currency    hedges, net of income taxes of $11			—				—				—				—				(18	)			—				(18	)
Cash dividends ($0.16 per share)			—				—				—				—				—				(7,943	)			(7,943	)
Share-based compensation			56,548				—				6,662				1,287				—				—				7,949
Repurchase of restricted shares for    minimum tax obligation			(19,361	)			—				—				(483	)			—				—				(483	)
Employee stock purchase plan			59,632				—				(2,189	)			3,810				—				—				1,621
March 31, 2018			49,669,848				51				851,280				(179,082	)			(367,870	)			146,155				450,534
Net loss			—				—				—				—				—				(321,767	)			(321,767	)
Adoption of ASC 606			—				—				—				—				—				(585,015	)			(585,015	)
Foreign currency translation    adjustment			—				—				—				—				10,077				—				10,077
Pension liability adjustment, net of    income taxes of ($656)			—				—				—				—				(128,639	)			—				(128,639	)
Change in fair value of foreign currency    hedges, net of income taxes of $228			—				—				—				—				(1,252	)			—				(1,252	)
Cash dividends ($0.16 per share)			—				—				—								—				(7,971	)			(7,971	)
Share-based compensation			186,572				—				(1,448	)			11,707				—				—				10,259
Repurchase of restricted shares for    minimum tax obligation			(42,146	)			—				—				(860	)			—				—				(860	)
Employee stock purchase plan			72,994				—				(3,354	)			4,675				—				—				1,321
Other			—				1				21,067				4,406				—				(25,474	)			—
March 31, 2019			49,887,268				52				867,545				(159,154	)			(487,684	)			(794,072	)			(573,313	)
Net loss			—				—				—				—				—				(28,126	)			(28,126	)
Adoption of ASC 842			—				—				—				—				—				(225	)			(225	)
Foreign currency translation    adjustment			—				—				—				—				(13,439	)			—				(13,439	)
Pension liability adjustment, net of    income taxes of $0			—				—				—				—				(215,132	)			—				(215,132	)
Change in fair value of foreign currency    hedges, net of income taxes of $0			—				—				—				—				(3,173	)			—				(3,173	)
Cash dividends ($0.16 per share)			—				—				—								—				(8,078	)			(8,078	)
Share-based compensation			264,658				—				(5,508	)			16,222				—				—				10,714
Repurchase of restricted shares for    minimum tax obligation			(69,601	)			—				—				(1,442	)			—				—				(1,442	)
Employee stock purchase plan			45,061				—				(1,811	)			2,761				—				—				950
Contribution of treasury shares to pension plan			1,730,703				—				(55,396	)			105,396				—				—				50,000
March 31, 2020			51,858,089			$	52			$	804,830			$	(36,217	)		$	(719,428	)		$	(830,501	)		$	(781,264	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

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TRIUMPH GROUP, INC.

Consolidated Statements of Cash Flows

(Dollars in thousands)

		Year ended March 31,
		2020				2019				2018
Operating Activities
Net loss		$	(28,126	)		$	(321,767	)		$	(425,391	)
Adjustments to reconcile net loss to net cash (used in) provided by    operating activities:
Depreciation and amortization			138,168				149,904				158,368
Impairment of goodwill			66,121				—				535,227
Amortization of acquired contract liability			(75,286	)			(67,314	)			(125,148	)
Loss on sale of assets and businesses			56,916				235,301				30,741
Curtailments, settlements and early retirement incentives			14,293				4,032				(25,722	)
Other amortization included in interest expense			11,157				8,770				11,677
Provision (recovery) for doubtful accounts receivable			1,554				(495	)			(242	)
Provision (benefit) for deferred income taxes			2,823				(7,939	)			(43,108	)
Share-based compensation			11,062				10,259				7,949
Changes in other assets and liabilities, excluding the effects of    acquisitions and divestitures:
Trade and other receivables			5,001				(89,728	)			(99,620	)
Contract assets			50,440				65,191				(5,484	)
Inventories			(48,802	)			(15,930	)			(163,417	)
Prepaid expenses and other current assets			16,376				(3,144	)			(4,239	)
Accounts payable, accrued expenses and income taxes payable			(61,338	)			(71,767	)			(43,696	)
Accrued pension and other postretirement benefits			(67,826	)			(79,911	)			(88,464	)
Other			4,133				10,118				(8,325	)
Net cash provided by (used in) operating activities			96,666				(174,420	)			(288,894	)
Investing Activities
Capital expenditures			(39,834	)			(47,099	)			(42,050	)
Proceeds from sale of assets and businesses			47,229				247,647				83,082
Acquisitions, net of cash acquired			—				—				(2,818	)
Net cash provided by investing activities			7,395				200,548				38,214
Financing Activities
Net increase in revolving credit facility			185,000				102,113				82,888
Proceeds from issuance of long-term debt			585,580				54,600				544,243
Retirement of debt and capital lease obligations			(449,650	)			(113,425	)			(387,373	)
Payment of deferred financing costs			(17,718	)			(1,982	)			(17,729	)
Dividends paid			(8,078	)			(7,971	)			(7,943	)
Repurchase of restricted shares for minimum tax obligations			(1,442	)			(860	)			(483	)
Net cash provided by financing activities			293,692				32,475				213,603
Effect of exchange rate changes on cash			(5,097	)			(1,615	)			3,263
Net change in cash and cash equivalents			392,656				56,988				(33,814	)
Cash and cash equivalents at beginning of year			92,807				35,819				69,633
Cash and cash equivalents at end of year		$	485,463			$	92,807			$	35,819

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

1.    BACKGROUND AND BASIS OF PRESENTATION

Triumph Group, Inc. ("Triumph") is a Delaware corporation which, through its operating subsidiaries, designs, engineers, manufactures and sells products for the global aerospace original equipment manufacturers ("OEMs") of aircraft and aircraft components and repairs and overhauls aircraft components and accessories for commercial airline, air cargo carrier and military customers on a worldwide basis. Triumph and its subsidiaries (collectively, the "Company") are organized based on the products and services that they provide. Effective February 17, 2020, the Company combined its Integrated Systems and Product Support operating segments into one operating segment, Systems & Support. Under this organizational structure, the Company has 2 reportable segments: Systems & Support and Aerospace Structures.  Segment information for prior periods has been recast to conform to this organizational structure.  

Systems & Support consists of the Company’s operations that provide integrated solutions, including design, development, and support of proprietary components, subsystems and systems, as well as production of complex assemblies using external designs.  Capabilities include hydraulic, mechanical and electromechanical actuation, power and control; a complete suite of aerospace gearbox solutions, including engine accessory gearboxes and helicopter transmissions; active and passive heat exchange technology; fuel pumps, fuel metering units and Full Authority Digital Electronic Control fuel systems; hydromechanical and electromechanical primary and secondary flight controls. Systems & Support also provides full life cycle solutions for commercial, regional and military aircraft. The Company’s extensive product and service offerings include full post-delivery value chain services that simplify the MRO supply chain. Through its ground support equipment maintenance, component MRO and post- production supply chain activities, Systems & Support is positioned to provide integrated planeside repair solutions globally. Capabilities include metallic and composite aircraft structures; nacelles; thrust reversers; interiors; auxiliary power units; and a wide variety of pneumatic, hydraulic, fuel and mechanical accessories.  Repair services generally involve the replacement and/or remanufacturing of parts, which is similar to the original manufacture of the part. The processes that the Company performs related to repair and overhaul services are essentially the repair of wear parts or replacement of parts that are beyond economic repair. The repair service generally involves remanufacturing a complete part or a component of a part.

Aerospace Structures consists of the Company’s operations that supply commercial, business, regional and military manufacturers with large metallic and composite structures and aircraft interior systems, including air ducting and thermal acoustic insulations systems. Products include wings, wing boxes, fuselage panels, horizontal and vertical tails, subassemblies such as floor grids, and aircraft interior systems, including air ducting and thermal acoustic insulations systems. Aerospace Structures also has the capability to engineer detailed structural designs in metal and composites. Capabilities include advanced composite and interior structures, joining processes such as welding, autoclave bonding, and conventional mechanical fasteners.

The accompanying consolidated financial statements include the accounts of Triumph and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated from the consolidated financial statements.

The preparation of 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 consolidated financial statements and accompanying notes.  Actual results could differ from those estimates.  

Standards Recently Implemented

Adoption of ASU 2016-02

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842). This ASU requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use ("ROU") assets.  The Company adopted the standard as of April 1, 2019, using the modified retrospective approach and applying the standard’s transition provisions at the adoption date.  Reporting periods beginning on or after April 1, 2019, are presented in accordance with Accounting Standards Codification ("ASC") 842, Leases.  Prior periods have not been adjusted and continue to be reported in accordance with previous accounting standards.  The Company elected the package of practical expedients permitted under the transition guidance, which among other things, allows the Company to not reassess the historical lease classification.  

Adoption of the new standard resulted in the recognition of operating lease ROU assets and lease liabilities of $76,444 and $84,663, respectively, with the difference due to prepaid and deferred rent that were reclassified to the ROU asset value. An adjustment to opening retained earnings of $225 was also recognized.  The standard did not materially affect the Company's consolidated statements of operations or cash flows. See Note 9 for further details.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Adoption of ASU 2018-02

In February 2018, the FASB issued ASU 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.  This ASU permits a company to reclassify the income tax effects of the 2017 Tax Cuts and Jobs Act (“U.S. tax reform”) on items within AOCI to retained earnings.  The Company adopted the provisions of this ASU in the first quarter of 2019 and elected not to reclassify the income tax effects of U.S. tax reform from items in accumulated other comprehensive income.  The Company's policy is to release the tax effects from accumulated other comprehensive income when the all of the related assets or liabilities that gave rise to the accumulated other comprehensive income have been derecognized.

Standards Issued Not Yet Implemented

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.  This ASU modifies the measurement of expected credit losses of certain financial instruments. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods.  The amendments in this ASU should be applied on a modified retrospective basis to all periods presented. The Company adopted ASU 2016-13 effective April 1, 2020, and the impact on our consolidated financial statements of adoption was not significant.  

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement.  This ASU modifies the disclosure requirements for fair value measurements by removing, modifying or adding certain disclosures.  ASU 2018-13 is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods, with early adoption permitted.  The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption.  All other amendments should be applied retrospectively to all periods presented upon their effective date.  The Company adopted ASU 2018-13 effective April 1, 2020, and does not expect the adoption to have a significant impact on its consolidated financial statement disclosures.

In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.  This ASU aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).  ASU 2018-15 is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods, with early adoption permitted.  The amendments in this ASU should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption.  The Company adopted ASU 2018-15 effective April 1, 2020, electing to apply the standard prospectively.  As a result of applying the standard prospectively, there was no impact on the Company’s consolidated financial statements and disclosures upon adoption.  

In August 2018, the FASB issued ASU 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans, which modifies the disclosure requirements for defined benefit pension plans and other postretirement plans. ASU 2018-14 is effective for annual periods beginning after December 15, 2020, with early adoption permitted.  The amendments in this ASU should be applied on a retrospective basis to all periods presented.  The Company is currently evaluating the effect that ASU 2018-14 will have on its consolidated financial statements and related disclosures.

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents

Cash equivalents consist of highly liquid investments with a maturity of three months or less at the time of purchase. Fair value of cash equivalents approximates carrying value.

Trade and Other Receivables, net

Trade and other receivables are presentedrecorded net of an allowance for doubtful accounts. In determining the appropriate allowance, we consider a combination of factors, such as industry trends, our customers' financial strength and credit standing, and payment and default history. The calculation of the required allowance requires a judgment as to the impact of theseTrade and other factors onreceivables include amounts billed and currently due from customers and amounts retained by the ultimate realizationcustomer pending contract completion. The Company performs ongoing credit evaluations of our trade receivables. We believe that these estimates are reasonableits customers and historically havegenerally does not resulted in material adjustments in subsequent periods when the estimates are adjusted to actual amounts.

Inventories

require collateral. The Company records inventories at the lower of cost or estimated net realizable value. Costsallowance for doubtful accounts based on long-term contractsprior experience and programs in progress represent recoverable costs incurred for production or contract-specific facilitiesspecific collectibility matters when they arise. The Company writes off balances against the reserve when collectibility is deemed remote. The Company's trade and equipment, allocable operating overhead and advancesother receivables are exposed to suppliers. Pursuantcredit risk; however, the risk is limited due to contract provisions, agenciesthe diversity of the U.S. Government and certain other customers have title to, or a security interest in, inventories related to such contracts as a result of advances, performance-based payments, and progress payments. The Company reflects those advances and payments as an offset against the related

inventory balances. The Company expenses general and administrative costs related to products and services provided essentially under commercial terms and conditions as incurred. The Company determines the costs of inventories by the first-in, first-out or average cost methods.

Advance payments and progress payments received on contracts-in-process are first offset against related contract costs that are included in inventory, with any remaining amount reflected in current liabilities.

Work-in-process inventory includes capitalized pre-production costs. Company policy allows for the capitalization of pre-production costs after it establishes a contractual arrangement with a customer that explicitly states that the cost of recovery of pre-production costs is allowed.

Capitalized pre-production costs include nonrecurring engineering, planning and design, including applicable overhead, incurred before production is manufactured on a regular basis. Significant customer-directed work changes can also cause pre-production costs to be incurred (see Note 5 of "Notesbase.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements"Statements

(Dollars in thousands, except per share data)

Trade and other receivables, net composed of the following:

		March 31,
		2020				2019
Total trade receivables		$	314,007			$	336,888
Other receivables			49,773				40,348
Total trade and other receivables			363,780				377,236
Less: Allowance for doubtful accounts			(4,293	)			(3,646	)
Total trade and other receivables, net		$	359,487			$	373,590

Goodwill and Intangible Assets

The Company accounts for further discussion).

Revenuegoodwill and Profit Recognition

Revenues are recognizedintangible assets in accordance with the contract terms when products are shipped, delivery has occurred or services have been rendered, pricing is fixed or determinable, and collection is reasonably assured.

A significant portion of our contracts are within the scope of Accounting Standards Codification ("ASC") 605-35, Revenue Recognition —Construction-Type and Production-Type Contracts, and revenue and costs on contracts are recognized using the percentage-of-completion method of accounting. Accounting for the revenue and profit on a contract requires estimates of (1) the contract value or total contract revenue, (2) the total costs at completion, which is equal to the sum of the actual incurred costs to date on the contract and the estimated costs to complete the contract's scope of work and (3) the measurement of progress towards completion. Depending on the contract, we measure progress toward completion using either the cost-to-cost method or the units-of-delivery method, with the great majority measured under the units-of-delivery method.

Under the cost-to-cost method, progress toward completion is measured as the ratio of total costs incurred to our estimate of total costs at completion. We recognize costs as incurred. Profit is determined based on our estimated profit margin on the contract multiplied by our progress toward completion. Revenue represents the sum of our costs and profit on the contract for the period.

Under the units-of-delivery method, revenue on a contract is recorded as the units are delivered and accepted during the period at an amount equal to the contractual selling price of those units. The costs recorded on a contract under the units-of-delivery method are equal to the total costs at completion divided by the total units to be delivered. As our contracts can span multiple years, we often segment the contracts into production lots for the purposes of accumulating and allocating cost. Profit is recognized as the difference between revenue for the units delivered and the estimated costs for the units delivered.

Adjustments to original estimates for a contract's revenues, estimated costs at completion and estimated total profit are often required as work progresses under a contract, as experience is gained and as more information is obtained, even though the scope of work required under the contract may not change, or if contract modifications occur. These estimates are also sensitive to the assumed rate of production. Generally, the longer it takes to complete the contract quantity, the more relative overhead that contract will absorb. The impact of revisions in cost estimates is recognized on a cumulative catch-up basis in the period in which the revisions are made. Provisions for anticipated losses on contracts are recorded in the period in which they become evident ("forward losses") and are first offset against costs that are included in inventory, with any remaining amount reflected in accrued contract liabilities in accordance with ASC 605-35. Revisions in contract estimates, if significant, can materially affect our results of operations and cash flows, as well as our valuation of inventory. Furthermore, certain contracts are combined or segmented for revenue recognition in accordance with ASC 605-35.

For the fiscal year ended March 31, 2016, cumulative catch-up adjustments resulting from changes in contract values and estimated costs that arose during the fiscal year decreased operating (loss) income, net (loss) income and earnings per share by approximately $(596.2) million, $(539.0) million and $(10.95), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2016, included gross favorable adjustments of approximately $33.0 million and gross unfavorable adjustments of approximately $629.2 million, which includes provisions of $561.2 million for forward losses on the Bombardier and 747-8 programs.

For the fiscal year ended March 31, 2015, cumulative catch-up adjustments resulting from changes in estimates decreased operating income, net income and earnings per share by approximately $(156.0) million, $(106.6) million and $(2.09), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2015, included

gross favorable adjustments of approximately $4.7 million and gross unfavorable adjustments of approximately $160.7 million, which includes a provision of $152.0 million for forward losses on the 747-8 program.

For the fiscal year ended March 31, 2014, cumulative catch-up adjustments resulting from changes in estimates decreased operating income, net income and earnings per share by approximately $(53.2) million, $(35.1) million and $(0.67), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2014, included gross favorable adjustments of approximately $14.3 million and gross unfavorable adjustments of approximately $67.5 million.

Amounts representing contract change orders or claims are only included in revenue when such change orders or claims have been settled with our customer and to the extent that units have been delivered. Additionally, some contracts may contain provisions for revenue sharing, price re-determination, requests for equitable adjustments, change orders or cost and/or performance incentives. Such amounts or incentives are included in contract value when the amounts can be reliably estimated and their realization is reasonably assured.

Although fixed-price contracts, which extend several years into the future, generally permit us to keep unexpected profits if costs are less than projected, we also bear the risk that increased or unexpected costs may reduce our profit or cause the Company to sustain losses on the contract. In a fixed-price contract, we must fully absorb cost overruns, notwithstanding the difficulty of estimating all of the costs we will incur in performing these contracts and in projecting the ultimate level of revenue that may otherwise be achieved.

As previously disclosed, we recognized a provision for forward losses associated with our long-term contract on the 747-8 and Bombardier programs. There is still risk similar to what we have experienced on the 747-8 and Bombardier programs. Particularly, our ability to manage risks related to supplier performance, execution of cost reduction strategies, hiring and retaining skilled production and management personnel, quality and manufacturing execution, program schedule delays and many other risks, will determine the ultimate performance of these long-term programs.

The Aftermarket Services Group provides repair and overhaul services, certain of which are provided under long-term power-by-the-hour contracts, comprising approximately 6% of the segment's fiscal 2016 net sales. The Company applies the proportional performance method to recognize revenue under these contracts. Revenue is recognized over the contract period as units are delivered based on the relative value in proportion to the total estimated contract consideration. In estimating the total contract consideration, management evaluates the projected utilization of its customer's fleet over the term of the contract, in connection with the related estimated repair and overhaul servicing requirements to the fleet based on such utilization. Changes in utilization of the fleet by customers, among other factors, may have an impact on these estimates and require adjustments to estimates of revenue to be realized.

350, Intangibles—Goodwill and Intangible Assets

GoodwillOther. Under ASC 350, goodwill and intangible assets with indefinite lives are not amortized; rather, they are tested for impairment on at least an annual basis. Additionally, intangibleIntangible assets with finite lives continue to beare amortized over their useful lives. Upon acquisition, critical estimates are made in valuing acquired intangible assets, which include, but are not limited to: future expected cash flows from customer contracts, customer lists, and estimating cash flows from projects when completed; tradename and market position, as well as assumptions about the period of time that customer relationships will continue; and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from the assumptions used in determining fair values.

The Company's operating segments of Aerostructures, Aerospace Systems and Aftermarket Services are also its reporting units under ASC 350, Intangibles—Goodwill and Other. The Chief Executive Officer is the Company's CODM. The Company's CODM evaluates performance and allocates resources based upon review of segment information. Each of the operating segments is comprised of a number of operating units which are considered to be components under ASC 350. The components, for which discrete financial information exists, are aggregated for purposes of goodwill impairment testing. The Company's acquisition strategy is to acquire companies that complement and enhance the capabilities of the operating segments of the Company. Each acquisition is assigned to either the Aerostructures reporting unit, the Aerospace Systems reporting unit or the Aftermarket Services reporting unit. The goodwill that results from each acquisition is also assigned to the reporting unit to which the acquisition is allocated, because it is that reporting unit which is intended to benefit from the synergies of the acquisition.

The Company assesses whether goodwill impairment exists using both the qualitative and quantitative assessments. The qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment the Company determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount or if

the Company elects not to perform a qualitative assessment, a quantitative assessment is performed using a two-step approachas required by ASC 350 to determine whether a goodwill impairment exists at the reporting unit.

The first step of the quantitative test is used to compare the carrying amount of the reporting unit's assets to the fair value of the reporting unit. If the fair value exceeds the carrying value, no further workevaluation is required, and no impairment loss is recognized. If the carrying amount exceeds the fair value, then an impairment loss occurs. The impairment is measured by using the second step is required to be completed,amount by which involves allocatingthe carrying value exceeds the fair value of the reporting unitnot to each asset and liability, with the excess being applied to goodwill. An impairment loss occurs ifexceed the amount of the recorded goodwill exceeds the implied goodwill. The determination of the fair value of ourits reporting units is based, among other things, on estimates of future operating performance of the reporting unit being valued. We areThe Company is required to complete an impairment test for goodwill and record any resulting impairment losses at least annually. Changes in market conditions, among other factors, may have an impact on these estimates and require interim impairment assessments.

When performing the two-step quantitative impairment test, the Company's methodology includes the use of an income approach which discounts future net cash flows to their present value at a rate that reflects the Company's cost of capital, otherwise known as the discounted cash flow method ("DCF"). These estimated fair values are based on estimates of future cash flows of the businesses. Factors affecting these future cash flows include the continued market acceptance of the products and services offered by the businesses, the development of new products and services by the businesses and the underlying cost of development, the future cost structure of the businesses and future technological changes. The Company also incorporates market multiples for comparable companies in determining the fair value of ourits reporting units. Any such impairment would be recognized in full in the reporting period in which it has been identified.

In  The fair value estimates resulting from the fourth quarterapplication of fiscal 2016, the Company performed the quantitative assessment, in lieuthese methodologies are based on inputs classified within Level 3 of the qualitative assessment for each of the Company's three reporting units, which indicated that the fair value of goodwill for the Aerostructures reporting unit did not exceed its carrying amount. As a result we incurred an $597.6 million impairment of goodwill to the Aerostructures reporting unit. The assessment for the Company's Aerospace Systems and Aftermarket Services reporting units indicated that the fair value of their respective goodwill exceeded the carrying amount. We incurred no impairment of goodwillhierarchy, as a result of our annual goodwill impairment tests in fiscal 2015 or 2014 (see Note 7 of "Notes to Consolidated Financial Statements" for further discussion).

As of March 31, 2015, the Company had a $438.4 million indefinite-lived intangible asset associated with the Vought and Embee tradenames. The Company assesses whether indefinite-lived intangible assets impairment exists using both the qualitative and quantitative assessments. The qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount. If based on this qualitative assessment the Company determines it is not more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount or if the Company elects not to perform a qualitative assessment, a quantitative assessment is performed to determine whether an indefinite-lived intangible asset impairment exists. We test the indefinite-lived intangible assets for impairment by comparing the carrying value to the fair value based on current revenue projections of the related operations, under the relief from royalty method. Any excess carry value over the amount of fair value is recognized as an impairment.

described below.  

During the thirdfourth quarter of the fiscal year ended March 31, 2016,2020, the Company performed its annual goodwill impairment assessment for each of its reporting units with no impairment identified.

Subsequent to its annual testing date and at March 31, 2020, the Company identified indicators of impairment due to the decline in the Company’s share price as well as potential negative impacts due to the uncertainty of the impact of the COVID-19 pandemic.  As a result of these indicators, the Company performed an interim assessment of goodwill, which included using a combination of both market and income approaches to estimate the fair value on our indefinite-lived intangible assets due to potential indicators of impairment related to the continued decline in our stock price during the fiscal third quarter. Based on the Company's evaluation of indefinite-lived assets, including the tradenames, theeach reporting unit. The Company concluded that the Vought tradenameits Product Support reporting unit had a fair value of $195.8 million (Level 3) compared to athat was lower than its carrying value of $425.0 million. Accordingly,by an amount that exceeded the remaining goodwill for the reporting unit. Therefore, the Company recorded a non-cashnoncash impairment charge during the fiscal quarter ended March 31, 2020, of $66,121, which is presented on the consolidated statements of operations as “Impairment of goodwill” for the fiscal year ended March 31, 2016, of $229.2 million, which is presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets".

In the fourth quarter of fiscal 2016, the Company performed its annual impairment test for each of the Company's indefinite-lived intangible assets, which indicated that the Vought and Embee tradenames had a fair value of $163.0 million (Level 3) compared to a carrying value of $209.2 million.2020. The decline in fair value of the tradenames is the result of expected declines in revenues from MRO services and the increaseuncertainty in discountthe rate duringand timing of recovery and therefore the fourth quarter, which requiredtiming of associated earnings and cash flows. The assessment of the Company to assess whether events and/or circumstances have changed regarding the indefinite-life conclusion. As a result we incurred a non-cash impairment charge of $46.2 million presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets" to the Vought and Embee tradenames. Additionally, it was determinedCompany’s Integrated Systems reporting unit indicated that the tradenames will be amortized over their remaining estimated useful life of 20 years. We incurred no impairment of indefinite-lived assets as a result of our annual indefinite-lived assets impairment tests in fiscal 2015 or 2014 (see Note 7 of "Notesits fair value exceeded its carrying amount.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements" for further discussion).

Statements

(Dollars in thousands, except per share data)

Finite-lived intangible assets are amortized over their useful lives ranging from 37 to 3230 years. WeThe Company continually evaluateevaluates whether events or circumstances have occurred that would indicate that the remaining estimated useful lives of our long-lived

assets, including intangible assets, may warrant revision or that the remaining balance may not be recoverable. IntangibleLong-lived assets are evaluated for indicators of impairment. When factors indicate that long-lived assets, including intangible assets, should be evaluated for possible impairment, an estimate of the related undiscounted cash flows over the remaining life of the long-lived assets, including intangible assets, is used to measure recoverability.recoverability based on the primary asset of the asset group. Some of the more important factors we considermanagement considers include ourthe Company's financial performance relative to our expected and historical performance, significant changes in the way we manage ourthe Company manages its operations, negative events that have occurred, and negative industry and economic trends. If the estimated fair value isundiscounted cash flows are less than the carrying value,amount, measurement of the impairment will be based on the difference between the carrying value and fair value of the asset group, generally determined based on the present value of expected future cash flows associated with the use of the asset.

Acquired

Refer to below for the Company's accounting policy regarding fair value measurements and the definition of fair value levels.

Revenue Recognition and Contract Liabilities,Balances

The Company adopted ASC 606 on April 1, 2018.  The Company's revenue is principally from contracts with customers to provide design, development, manufacturing, and support services associated with specific customer programs. The Company regularly enters into long-term master supply agreements that establish general terms and conditions and may define specific program requirements. Many agreements include clauses that provide sole supplier status to the Company for the duration of the program’s life. Purchase orders (or authorizations to proceed) are issued pursuant to the master supply agreements. Additionally, a majority of the Company’s agreements with customers include options for future purchases. Such options primarily reduce the administrative effort of issuing subsequent purchase orders and do not represent material rights granted to customers. The Company generally enters into agreements directly with its customers and is the principal in all current contracts.

The identification of a contract with a customer for purposes of accounting and financial reporting requires an evaluation of the terms and conditions of agreements to determine whether presently enforceable rights and obligations exist. Management considers a number of factors when making this evaluation that include, but are not limited to, the nature and substance of the business exchange, the specific contractual terms and conditions, the promised products and services, the termination provisions in the contract, as well as the nature and execution of the customer’s ordering process and how the Company is authorized to perform work. Generally, presently enforceable rights and obligations are not created until a purchase order is issued by a customer for a specified number of units of product or services. Therefore, the issuance of a purchase order is generally the point at which a contract is identified for accounting and financial reporting purposes.

Management identifies the promises to the customer. Promises are generally explicitly stated in each contract, but management also evaluates whether any promises are implied based on the terms of the agreement, past business practice, or other facts and circumstances. Each promise is evaluated to determine if it is a performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service. The Company considers a number of factors when determining whether a promise is a distinct performance obligation, including whether the customer can benefit from the good or service on its own or together with other resources that are readily available to the customer, whether the Company provides a significant service of integrating goods or services to deliver a combined output to the customer, or whether the goods or services are highly interdependent. The Company’s performance obligations consist of a wide range of engineering design services and manufactured components, as well as spare parts and repairs for original equipment manufacturers (“OEMs”).

The transaction price for a contract reflects the consideration the Company expects to receive for fully satisfying the performance obligations in the contract. Typically, the transaction price consists solely of fixed consideration but may include variable consideration for contractual provisions such as unpriced contract modifications, cost-sharing provisions, and other receipts or payments to customers. The Company identifies and estimates variable consideration, typically at the most likely amount the Company expects to receive from its customers. Variable consideration is only included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized for the contract will not occur, or when the uncertainty associated with the variable consideration is resolved. The Company's contracts with customers generally require payment under normal commercial terms after delivery with payment typically required within 30 to 120 days of delivery. However, a subset of the Company’s current contracts includes significant financing components because the timing of the transfer of the underlying products and services under contract are at the customers’ discretion. For these contracts, the Company adjusts the transaction price to reflect the effects of the time value of money.

The Company generally is not subject to collecting sales tax and has made an accounting policy election to exclude from the transaction price any sales and other similar taxes collected from customers. As a result, any such collections are accounted for on a net

basis.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The total transaction price is allocated to each of the identified performance obligations using the relative stand-alone selling price. The objective of the allocation is to reflect the consideration that the Company expects to receive in exchange for the products or services associated with each performance obligation. Stand-alone selling price is the price at which the Company would sell a promised good or service separately to a customer. Stand-alone selling prices are established at contract inception, and subsequent changes in transaction price are allocated on the same basis as at contract inception. When stand-alone selling prices for the Company’s products and services are not observable, the Company uses either the “Expected Cost Plus a Margin” or "Adjusted Market Assessment" approaches to estimate stand-alone selling price. Expected costs are typically derived from the available periodic forecast information.

Revenue is recognized when or as control of promised products or services transfers to a customer and is recognized at the amount allocated to each performance obligation associated with the transferred products or services. Service sales, principally representing repair, maintenance, and engineering activities are recognized over the contractual period or as services are rendered. Sales under long-term contracts with performance obligations satisfied over time are recognized using either an input or output method. The Company recognizes revenue over time as it performs on these contracts because of the continuous transfer of control to the customer as represented by contractual terms that entitle the Company to the reimbursement of costs plus a reasonable profit for work performed to manufacture products for which the Company has no alternate use or for work performed on a customer-owned asset.

With control transferring over time, revenue is recognized based on the extent of progress toward completion of the performance obligation. The Company generally uses the cost-to-cost input method of progress for its contracts because it best depicts the transfer of control to the customer that occurs as work progresses. Under the cost-to-cost method, the extent of progress toward completion is measured based on the proportion of costs incurred to date to the total estimated costs at completion of the performance obligation. The Company reviews its cost estimates on contracts on a periodic basis, or when circumstances change and warrant a modification to a previous estimate. Cost estimates are largely based on negotiated or estimated purchase contract terms, historical performance trends and other economic projections. Significant factors that influence these estimates include inflationary trends, technical and schedule risk, internal and subcontractor performance trends, business volume assumptions, asset utilization, and anticipated labor agreements.

Revenue and cost estimates are regularly monitored and revised based on changes in circumstances. Impacts from changes in estimates of net sales and cost of sales are recognized on a cumulative catch-up basis, which recognizes in the current period the cumulative effect of the changes on current and prior periods based on a performance obligation’s percentage of completion. Forward loss reserves for anticipated losses on long-term contracts are recorded in full when such losses become evident, to the extent required, and are included in contract liabilities on the accompanying consolidated balance sheets. The Company believes that the accounting estimates and assumptions made by management are appropriate given the increased uncertainties surrounding the severity and duration of the impacts of the COVID-19 pandemic, however actual results could differ materially from those estimates.

For the fiscal year ended March 31, 2020, cumulative catch-up adjustments resulting from changes in contract values and estimated costs that arose during the fiscal year increased revenue, operating loss, net loss and loss per share by approximately $12,011, ($22,844), ($22,844), and ($0.45), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2020, included gross favorable adjustments of approximately $43,405 and gross unfavorable adjustments of approximately $66,249.

For the fiscal year ended March 31, 2019, cumulative catch-up adjustments resulting from changes in estimates increased net sales, decreased operating loss, net loss and earnings per share by approximately $7,944, ($68,694), ($68,694), and ($1.38), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2019, included gross favorable adjustments of approximately $46,074 and gross unfavorable adjustments of approximately $114,768. These cumulative catch-up adjustments do not include a noncash charge the Company recorded as a result of the adoption of ASU 2017-07 of $87,241 due to a change in estimate from a change in accounting principles, which is presented on the accompanying consolidated statements of operations within cost of sales.

For the fiscal year ended March 31, 2018, cumulative catch-up adjustments resulting from changes in estimates decreased operating loss, net loss and decreased loss per share by approximately $19,677, $13,479, and $0.27, respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2018, included gross favorable adjustments of approximately $85,844 and gross unfavorable adjustments of approximately $66,167.

Revenues for performance obligations that are not recognized over time are recognized at the point in time when control transfers to the customer. For performance obligations that are satisfied at a point in time, the Company evaluates the point in time when the customer can direct the use of and obtain the benefits from the products and services. Generally, the shipping terms determine the point in time when control transfers to customers. Shipping and handling activities are not considered performance obligations and related costs are included in cost of sales as incurred.

Differences in the timing of revenue recognition and contractual billing and payment terms result in the recognition contract assets and liabilities. Refer to Note 4 for further discussion.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

In connection with several of ourprior acquisitions, wethe Company assumed existing long-term contracts. Based on our review of these contracts, wethe Company concluded that the terms of certain contracts to be either more or less favorable than could be realized in market transactions as of the date of the acquisition. As a result, wethe Company recognized acquired contract liabilities, net of acquired contract assets as of the acquisition date of each respective acquisition, based on the present value of the difference between the contractual cash flows of the executory contracts and the estimated cash flows had the contracts been executed at the acquisition date. The liabilities principally relate to long-term life of program contracts that were initially executed at several years prior to the respective acquisition (see Note 3 of "Notes to Consolidated Financial Statements" for further discussion).

The acquired contract liabilities, net, are being amortized as non-cash revenues over the terms of the respective contracts. The Company recognized net amortization of contract liabilities of approximately $132.4 million, $75.7 million and $42.6 million in the fiscal years ended March 31, 2016, 2015 and 2014, respectively, and such amounts have been included in revenues in our results of operations. The balance of the liability as of March 31, 2016, is approximately $522.7 million and, based on the expected delivery schedule of the underlying contracts, the Company estimates annual amortization of the liability as follows 2017—$125.2 million; 2018—$117.5 million; 2019—$78.0 million; 2020—$59.7 million; 2021—$59.7 million; Thereafter—$82.6 million.

Postretirement Plans

The liabilities and net periodic cost of our pension and other postretirement plans are determined using methodologies that involve several actuarial assumptions, the most significant of which are the discount rate, the expected long-term rate of asset return and rate of growth for medical costs. The actuarial assumptions used to calculate these costs are reviewed annually or when a remeasurement is necessary. Assumptions are based upon management's best estimates, after consulting with outside investment advisors and actuaries, as of the measurement date.

During the fourth quarter of the fiscal year ended March 31, 2016, we changed the method we use to estimate the service and interest components of net periodic benefit cost for our pension and other postretirement benefit plans.  This new estimation approach discounts the individual expected cash flows underlying the service cost and interest cost by applying the specific spot rates derived from the yield curve used to discount the cash flows reflected in the measurement of the benefit obligation.  Historically, we estimated these service and interest cost components utilizing a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period.

We made this change to provide a more precise measurement of service and interest costs by improving the correlation between projected benefit cash flows to the corresponding spot yield curve rates.  We have accounted for this change as a change in accounting estimate that is inseparable from a change in accounting principle pursuant to ASC 250, Accounting Changes and Error Corrections and accordingly have accounted for it prospectively.  While the benefit obligation measured under this approach is unchanged from that determined under the prior approach, the more granular application of the spot rates will reduce the service and interest cost for the pension and OPEB plans for the fiscal year ended March 31, 2017, by approximately $20.0 million. The spot rates used to determine service and interest costs for the U.S. plans ranged from 0.60% to 9.75%. Under the Company’s prior methodology, these rates would have resulted in weighted-average rates for service cost and interest cost of 3.86% for the U.S. pension plans and 3.73% for the OPEB plans. The new approach will be used to measure the service cost and interest cost for our pension and OPEB plans for the fiscal year ended March 31, 2017.

Effective April 1, 2015, the Company changed the period over which actuarial gains and losses are being amortized for its U.S. pension plans from the average remaining future service period of active plan participants to the average life expectancy of inactive plan participants. This change was made because the Company has determined that as of that date almost all plan participants are inactive.

The accounting corridor is a defined range within which amortization of net gains and losses is not required. The discount rates at March 31, 2016, ranged from 3.25 - 3.93% compared to a weighted-average of 3.78% at March 31, 2015.

The assumed expected long-term rate of return on assets is the weighted-average rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the Projected Benefit Obligation ("PBO"). The expected average long-term rate of return on assets is based on several factors, including actual historical market index returns, anticipated long-term performance of individual asset classes with consideration given to the related investment strategy, plan expenses and the potential to outperform market index returns. This rate is utilized principally in calculating the expected return on plan assets component of the annual pension expense. To the extent the actual rate of return on assets realized over the course of a year differs from the assumed rate, that year's annual pension expense is not affected. The gain or loss reduces or increases future pension expense over the average remaining life expectancy of inactive plan participants. The expected long-term rate of return for fiscal 2016, 2015 and 2014, was 6.50 - 8.25%. The expected long-term rate of return for fiscal 2017 will be 8.00%.

In addition to our defined benefit pension plans, we provide certain healthcare and life insurance benefits for some retired employees. Such benefits are unfunded as of March 31, 2016. Employees achieve eligibility to participate in these contributory plans upon retirement from active service if they meet specified age and years of service requirements. Election to participate for eligible employees must be made at the date of retirement. Qualifying dependents at the date of retirement are also eligible for medical coverage. Current plan documents reserve our right to amend or terminate the plans at any time, subject to applicable collective bargaining requirements for represented employees. From time to time, we have made changes to the benefits provided to various groups of plan participants. Premiums charged to most retirees for medical coverage prior to age 65 are based on years of service and are adjusted annually for changes in the cost of the plans as determined by an independent actuary. In addition to this medical inflation cost-sharing feature, the plans also have provisions for deductibles, co-payments, coinsurance percentages, out-of-pocket limits, schedules of reasonable fees, preferred provider networks, coordination of benefits with other plans, and a Medicare carve-out.

In accordance with ASC 715, Compensation—Retirement Benefits, we recognized the funded status of our benefit obligation. This funded status is remeasured as of our annual remeasurement date. The funded status is measured as the difference between the fair value of the plan's assets and the PBO or accumulated postretirement benefit obligation of the plan. In order to recognize the funded status, we determined the fair value of the plan assets. The majority of our plan assets are publicly traded investments which were valued based on the market price as of the date of remeasurement. Investments that are not publicly traded were valued based on the estimated fair value of those investments as of the remeasurement date based on our evaluation of data from fund managers and comparable market data.

The Company periodically experiences events or makes changes to its benefit plans that result in curtailment or special charges. Curtailments are recognized when events occur that significantly reduce the expected years of future service of present employees or eliminates the benefits for a significant number of employees for some or all of their future service.

Curtailment losses are recognized when it is probable the curtailment will occur and the effects are reasonably estimable. Curtailment gains are recognized when the related employees are terminated or a plan amendment is adopted, whichever is applicable.

As required under ASC 715, the Company remeasures plan assets and obligations during an interim period whenever a significant event occurs that results in a material change in the net periodic pension cost. The determination of significance is based on judgment and consideration of events and circumstances impacting the pension costs.

See Note 15 of "Notes to Consolidated Financial Statements" for a summary of the key events that affected our net periodic benefit cost and obligations that occurred during the fiscal years ended March 31, 2016, 2015 and 2014.

Pension income, excluding curtailments, settlements and special termination benefits (early retirement incentives) for the fiscal year ended March 31, 2016, was $57.2 million compared with pension income of $52.4 million for the fiscal year ended March 31, 2015, and $35.0 million for the fiscal year ended March 31, 2014. For the fiscal year ending March 31, 2017, the Company expects to recognize pension income of approximately $66.5 million.

Recently Issued Accounting Pronouncements

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842). ASU 2016-02 requires lessees to recognize assets and liabilities for most leases. ASU 2016-02 is effective for annual periods beginning after December 15, 2018. Early adoption is permitted. Full retrospective application is prohibited. ASU 2016-02's transition provision are applied using a modified retrospective approach at the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating ASU 2016-02 and has

not determined the impact it may have on the Company’s consolidated results of operations, financial position or cash flows nor decided on the method of adoption.

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Subtopic 740-10): Balance Sheet Classification of Deferred Taxes. ASU 2015-17 requires companies to classify all deferred tax assets and liabilities as noncurrent on the balance sheet instead of separating deferred taxes into current and noncurrent amounts. ASU 2015-17 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is allowed for financial statements that have not been previously issued. Entities may elect to adopt the guidance either prospectively or retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). During fiscal 2016, the Company adopted this standard retrospectively to all prior periods and resulting in a reclass of $145.4 million from a current deferred tax asset to a noncurrrent deferred tax liability on the Consolidated Balance Sheet. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows.

In September 2015, the FASB issued ASU 2015-16, Business Combinations(Topic 805):Simplifying the Accounting for Measurement-Period Adjustments. ASU 2015-16 eliminates the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Instead, an acquirer will recognize a measurement-period adjustment during the period in which it determines the amount of the adjustment. ASU 2015-16 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. The Company adopted this standard effective January 1, 2016. The adoption did not have a material impact on the Company's financial position, results of operations or cash flows.

In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 requires companies to present debt issuance costs as a direct deduction from the carrying value of that debt liability. ASU 2015-03 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is allowed for financial statements that have not been previously issued. Entities would apply the new guidance retrospectively to all prior periods. Effective April 1, 2015, the Company adopted this standard. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows. In accordance with ASC 2015-15, the Company has excluded debt issuance costs relating to revolving debt instruments as a direct deduction to debt.

In May 2014, the FASB issued guidance codified in Accounting Standards Codification ("ASC") 606, Revenue Recognition - Revenue from Contracts with Customers, which amends the guidance in former ASC 605, Revenue Recognition. The objective of ASC 606 is to establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most of the existing revenue recognition guidance. The principle of ASC 606 is that an entity will recognize revenue at the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled. ASC 606 is effective for interim and annual reporting periods beginning after December 15, 2016, and can be adopted by the Company using either a full retrospective or modified retrospective approach, with early adoption prohibited. The Company is currently evaluating ASC 606 and has not determined the impact it may have on the Company’s consolidated results of operations, financial position or cash flows nor decided on the method of adoption.

Forward-Looking Statements

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to our future operations and prospects, including statements that are based on current projections and expectations about the markets in which we operate, 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 us. 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 our business segments, dependence of certain of our businesses on certain key customers, the risk that we will not realize all of the anticipated benefits from acquisitions as well as competitive factors relating to the aerospace industry. For a more detailed discussion of these and other factors affecting us, see the risk factors described in "Item 1A. Risk Factors."

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk

Commodity Price Risk

Some contracts with our suppliers for raw materials, component parts and other goods are short-term contracts, which are subject to termination on a relatively short-term basis. The prices of our raw materials and component parts fluctuate depending on market conditions, and substantial increases in prices could increase our operating costs, which, as a result of our fixed-price contracts, we may not be able to recoup through increases in the prices of our products. We generally do not employ forward contracts or other financial instruments to hedge commodity price risk, although we continue to review a full range of business options focused on strategic risk management for all material commodities.

Any failure by our suppliers to provide acceptable raw materials, components, kits or subassemblies could adversely affect our production schedules and contract profitability. We assess qualification of suppliers and continually monitor them to control risk associated with such supply base reliance.

To a lesser extent, we also are exposed to fluctuations in the prices of certain utilities and services, such as electricity, natural gas, chemicals and freight. We utilize a range of long-term agreements to minimize procurement expense and supply risk in these areas.

Foreign Exchange Risk

In addition, even when revenues and expenses are matched, we must translate foreign denominated results of operations, assets and liabilities for our foreign subsidiaries to U.S. dollars in our consolidated financial statements. Consequently, increases and decreases in the value of the U.S. dollar as compared to the respective foreign currencies will affect our reported results of operations and the value of our assets and liabilities on our consolidated balance sheet, even if our results of operations or the value of those assets and liabilities has not changed in its original currency. These transactions could significantly affect the comparability of our results between financial periods and/or result in significant changes to the carrying value of our assets, liabilities and stockholders' equity.

We are subject to foreign currency exchange rate risk relating to receipts from customers and payments to suppliers in foreign currencies. We use foreign currency forward contracts to hedge the price risk associated with forecasted foreign denominated payments related to our ongoing business. Foreign currency forward contracts are sensitive to changes in foreign currency exchange rates. At March 31, 2016, a 10% change in the exchange rate in our portfolio of foreign currency contracts would not have material impact on our unrealized gains. Consistent with the use of these contracts to neutralize the effect of exchange rate fluctuations, such unrealized losses or gains would be offset by corresponding gains or losses, respectively, in the remeasurement of the underlying transactions being hedged. When taken together, these forward currency contracts and the offsetting underlying commitments do not create material market risk.

Interest Rate Risk

Our primary exposure to market risk consists of changes in interest rates on borrowings. An increase in interest rates would adversely affect our 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 our ability to pay dividends on our common stock, if permitted to do so under certain of our debt arrangements, including the Credit Facility. We manage exposure to interest rate fluctuations by optimizing the use of fixed and variable rate debt. As of March 31, 2016, approximately 77% of our debt was fixed-rate debt. Our financing policy states that we generally maintain between 50% and 75% of our debt as fixed-rate debt, however, a portion of our variable debt is fixed through an interest rate swap. The information below summarizes our market risks associated with debt obligations and should be read in conjunction with Note 10 of "Notes to Consolidated Financial Statements."

The following table presents principal cash flows and the related interest rates. Fixed interest rates disclosed represent the weighted-average rate as of March 31, 2016. Variable interest rates disclosed fluctuate with the LIBOR, federal funds rates and other weekly rates and represent the weighted-average rate at March 31, 2016.

Expected Years of Maturity

	Next 12 Months				13 - 24 Months				25 - 36 Months				37 - 48 Months				49 - 60 Months				Thereafter				Total
Fixed-rate cash flows (in thousands)	$	42,383			$	46,904			$	51,832			$	255,707			$	15,527			$	680,285			$	1,092,638
Weighted-average interest rate (%)	4.31		%		4.36		%		4.41		%		4.68		%		5.02		%		2.18		%
Variable-rate cash flows (in thousands)	$	—			$	191,300			$	140,000			$	—			$	2,178			$	—			$	333,478
Weighted-average interest rate (%)	—		%		1.29		%		0.95		%		—		%		0.06		%		—		%

There are no other significant market risk exposures.

Item 8.	Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of Triumph Group, Inc.

We have audited the accompanying consolidated balance sheets of Triumph Group, Inc. as of March 31, 2016 and 2015, and the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows for each of the three years in the period ended March 31, 2016. Our audits also included the financial statement schedule listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Triumph Group, Inc. at March 31, 2016 and 2015, and the consolidated results of its operations and its cash flows for each of the three years in the period ended March 31, 2016, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Triumph Group, Inc.'s internal control over financial reporting as of March 31, 2016, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated May 27, 2016, expressed an unqualified opinion thereon.

	/s/ Ernst & Young LLP

Philadelphia, Pennsylvania

May 27, 2016

TRIUMPH GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)

	March 31,
	2016				2015
ASSETS
Current assets:
Cash and cash equivalents	$	20,984			$	32,617
Trade and other receivables, less allowance for doubtful accounts of $6,492 and $6,475	444,208				521,601
Inventories, net of unliquidated progress payments of $123,155 and $189,923	1,184,238				1,280,274
Rotable assets	51,952				48,820
Prepaid expenses and other	41,259				23,069
Total current assets	1,742,641				1,906,381
Property and equipment, net	889,734				950,734
Goodwill	1,444,254				2,024,846
Intangible assets, net	649,612				966,365
Other, net	108,852				107,999
Total assets	$	4,835,093			$	5,956,325
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	42,441			$	42,255
Accounts payable	410,225				429,134
Accrued expenses	683,208				411,848
Total current liabilities	1,135,874				883,237
Long-term debt, less current portion	1,374,879				1,326,345
Accrued pension and other postretirement benefits, noncurrent	664,664				538,381
Deferred income taxes, noncurrent	62,453				261,100
Other noncurrent liabilities	662,279				811,478
Stockholders' equity:
Common stock, $.001 par value, 100,000,000 shares authorized, 52,460,020 and 52,460,020 shares issued; 49,328,999 and 49,273,053 shares outstanding	51				51
Capital in excess of par value	851,102				851,940
Treasury stock, at cost, 3,131,921 and 3,187,867 shares	(199,415		)		(203,514		)
Accumulated other comprehensive loss	(347,162		)		(198,910		)
Retained earnings	630,368				1,686,217
Total stockholders' equity	934,944				2,135,784
Total liabilities and stockholders' equity	$	4,835,093			$	5,956,325

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

	Year ended March 31,
	2016				2015				2014
Net sales	$	3,886,072			$	3,888,722			$	3,763,254
Operating costs and expenses:
Cost of sales (exclusive of depreciation shown separately below)	3,597,299				3,141,453				2,911,802
Selling, general and administrative	287,349				285,773				254,715
Depreciation and amortization	177,755				158,323				164,277
Impairment of intangible assets	874,361				—				—
Restructuring	36,182				3,193				31,290
Curtailments, settlements and early retirement incentives	(1,244		)		—				1,166
Legal settlement charge (gain), net	5,476				(134,693		)		—
	4,977,178				3,454,049				3,363,250
Operating (loss) income	(1,091,106		)		434,673				400,004
Interest expense and other	68,041				85,379				87,771
(Loss) income from continuing operations before income taxes	(1,159,147		)		349,294				312,233
Income tax (benefit) expense	(111,187		)		110,597				105,977
Net (loss) income	$	(1,047,960	)		$	238,697			$	206,256
Earnings per share—basic:
Net (loss) income	$	(21.29	)		$	4.70			$	3.99
Weighted-average common shares outstanding—basic	49,218				50,796				51,711
Earnings per share—diluted:
Net (loss) income	$	(21.29	)		$	4.68			$	3.91
Weighted-average common shares outstanding—diluted	49,218				51,005				52,787

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(Dollars in thousands)

	Year ended March 31,
	2016				2015				2014
Net (loss) income	$	(1,047,960	)		$	238,697			$	206,256
Other comprehensive (loss) income:
Foreign currency translation adjustment	(12,065		)		(46,949		)		(3,315		)
Defined benefit pension plans and other postretirement benefits:
Amounts arising during the period - gains (losses), net of tax (expense) benefit:
Prior service credit, net of taxes $14,725, $19 and $21, respectively	27,392				(31		)		(37		)
Actuarial gain (loss), net of taxes $86,261, $71,060, and ($27,546), respectively	(154,659		)		(122,636		)		45,995
Reclassification from net income - (gains) losses, net of tax expense (benefit):
Amortization of net loss, net of taxes of ($1,263), $0 and ($5,647), respectively	2,119				—				9,402
Recognized prior service credits, net of taxes of $5,937, $3,864 and $6,814, respectively	(10,876		)		(6,133		)		(11,346		)
Total defined benefit pension plans and other postretirement benefits, net of taxes	(136,024		)		(128,800		)		44,014
Cash flow hedges:
Unrealized (loss) gain arising during period, net of tax benefit (expense) of $384, $2,463 and ($884), respectively	(527		)		(4,098		)		1,384
Reclassification of gain included in net earnings, net of tax expense of ($173), $42 and $11, respectively	364				(155		)		(19		)
Net unrealized (loss) gain on cash flow hedges, net of tax	(163		)		(4,253		)		1,365
Total other comprehensive income (loss)	(148,252		)		(180,002		)		42,064
Total comprehensive (loss) income	$	(1,196,212	)		$	58,695			$	248,320

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Dollars in thousands)

	Outstanding Shares			Common Stock All Classes				Capital in Excess of Par Value				Treasury Stock				Accumulated Other Comprehensive (Loss) Income				Retained Earnings				Total
Balance at March 31, 2013	50,123,035			$	50			$	848,372			$	—			$	(60,972	)		$	1,257,708			$	2,045,158
Net income	—			—				—				—				—				206,256				206,256
Foreign currency translation adjustment	—			—				—				—				(3,315		)		—				(3,315		)
Pension liability adjustment, net of income taxes of $26,358	—			—				—				—				44,014				—				44,014
Change in fair value of interest rate swap, net of income taxes of ($945)	—			—				—				—				1,481				—				1,481
Change in fair value of foreign currency hedges, net of income taxes of $72	—			—				—				—				(116		)		—				(116		)
Issuance of stock upon conversion of convertible notes	2,290,755			2				14,000				—				—				—				14,002
Purchase of 300,000 shares of common stock	(300,000	)		—				—				(19,134		)		—				—				(19,134		)
Exercise of stock options	18,170			—				290				—				—				—				290
Cash dividends ($0.16 per share)	—			—				—				—				—				(8,344		)		(8,344		)
Share-based compensation	61,413			—				6,306				—				—				—				6,306
Repurchase of restricted shares for minimum tax obligation	(34,353	)		—				(2,726		)		—				—				—				(2,726		)
Excess tax benefit from exercise of stock options	—			—				39				—				—				—				39
Balance at March 31, 2014	52,159,020			52				866,281				(19,134		)		(18,908		)		1,455,620				2,283,911
Net income	—			—				—				—				—				238,697				238,697
Foreign currency translation adjustment	—			—				—				—				(46,949		)		—				(46,949		)
Pension liability adjustment, net of income taxes of ($74,763)	—			—				—				—				(128,800		)		—				(128,800		)
Change in fair value of interest rate swap, net of taxes, $2,014	—			—				—				—				(3,156		)		—				(3,156		)
Change in fair value of foreign currency hedges, net of income taxes, $490	—			—				—				—				(1,097		)		—				(1,097		)
Settlement of convertible notes	—			(1		)		(19,386		)		—				—				—				(19,387		)
Deferred tax impact of convertible debt redemption	—			—				2,725				—				—				—				2,725
Purchase of 2,923,011 shares of common stock	(2,923,011	)		—				—				(184,380		)		—				—				(184,380		)
Exercise of stock options	45,782			—				720				—				—				—				720
Cash dividends ($0.16 per share)	—			—				—				—				—				(8,100		)		(8,100		)
Share-based compensation	1,600			—				1,272				—				—				—				1,272
Repurchase of restricted shares for minimum tax obligation	(10,338	)		—				(673		)		—				—				—				(673		)
Excess tax benefit from exercise of stock options	—			—				1,001				—				—				—				1,001
Balance at March 31, 2015	49,273,053			51				851,940				(203,514		)		(198,910		)		1,686,217				2,135,784
Net loss	—			—				—				—				—				(1,047,960		)		(1,047,960		)
Foreign currency translation adjustment	—			—				—				—				(12,065		)						(12,065		)
Pension liability adjustment, net of income taxes of $76,210	—			—				—				—				(136,024		)		—				(136,024		)
Change in fair value of interest rate swap, net of taxes, $636	—			—				—				—				(1,146		)		—				(1,146		)
Change in fair value of foreign currency hedges, net of income taxes of ($425)	—			—				—				—				983				—				983
Cash dividends ($0.16 per share)	—			—				—				—				—				(7,889		)		(7,889		)
Share-based compensation	36,598			—				(590		)		3,247				—				—				2,657
Repurchase of restricted shares for minimum tax obligation	(1,528	)		—				(96		)		—				—				—				(96		)
Employee stock purchase plan	20,876			—				(152		)		852				—				—				700
Balance at March 31, 2016	49,328,999			$	51			$	851,102			$	(199,415	)		$	(347,162	)		$	630,368			$	934,944

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

	Year ended March 31,
	2016				2015				2014
Operating Activities
Net (loss) income	$	(1,047,960	)		$	238,697			$	206,256
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	177,755				158,323				164,277
Impairment of intangible assets	874,361				—				—
Amortization of acquired contract liability	(132,363		)		(75,733		)		(42,629		)
Curtailments, settlements and early retirement incentives	(1,244		)		—				1,166
Accretion of debt discount	—				1,577				1,946
Other amortization included in interest expense	3,904				8,135				6,702
Provision for doubtful accounts receivable	1,996				172				2,191
Provision (benefit) for deferred income taxes	(118,302		)		105,277				102,869
Employee stock compensation	2,657				1,272				4,653
Changes in other current assets and liabilities, excluding the effects of acquisitions:
Accounts receivable	73,083				69,500				(46,378		)
Inventories	294,360				49,536				(94,341		)
Rotable assets	(843		)		(7,153		)		(6,813		)
Prepaid expenses and other current assets	(6,958		)		1,589				(406		)
Accounts payable, accrued expenses and income taxes payable	53,914				95,167				(60,209		)
Accrued pension and other postretirement benefits	(87,559		)		(180,569		)		(100,929		)
Other	(2,938		)		1,542				(3,218		)
Net cash provided by operating activities	83,863				467,332				135,137
Investing Activities
Capital expenditures	(80,047		)		(110,004		)		(206,414		)
Reimbursements of capital expenditures from insurance and other	—				653				9,086
Proceeds from sale of assets	6,069				3,167				45,047
Acquisitions, net of cash acquired	(54,051		)		38,281				(94,456		)
Net cash used in investing activities	(128,029		)		(67,903		)		(246,737		)
Financing Activities
Net (decrease) increase in revolving credit facility	(8,256		)		(46,150		)		98,557
Proceeds from issuance of long-term debt	134,797				508,960				451,003
Retirement of debt and capital lease obligations	(80,917		)		(655,860		)		(416,645		)
Payment of deferred financing costs	(185		)		(6,487		)		(3,297		)
Purchase of common stock	—				(184,380		)		(19,134		)
Dividends paid	(7,889		)		(8,100		)		(8,344		)
Net (repayment) proceeds of government grant	(5,000		)		(3,198		)		3,456
Repurchase of restricted shares for minimum tax obligations	(96		)		(673		)		(2,726		)
Proceeds from exercise of stock options, including excess tax benefit of $0, $1,001, and $39 in 2016, 2015, and 2014	—				720				329
Net cash provided by (used in) financing activities	32,454				(395,168		)		103,199
Effect of exchange rate changes on cash	79				(642		)		5,362
Net change in cash and cash equivalents	(11,633		)		3,619				(3,039		)
Cash and cash equivalents at beginning of year	32,617				28,998				32,037
Cash and cash equivalents at end of year	$	20,984			$	32,617			$	28,998

See notes to consolidated financial statements.

TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share data)

1.	BACKGROUND AND BASIS OF PRESENTATION

Triumph Group, Inc. ("Triumph") is a Delaware corporation which, through its operating subsidiaries, designs, engineers, manufactures and sells products for the global aerospace original equipment manufacturers ("OEMs") of aircraft and aircraft components and repairs and overhauls aircraft components and accessories for commercial airline, air cargo carrier and military customers on a worldwide basis. Triumph and its subsidiaries (collectively, the "Company") is organized based on the products and services that it provides. Under this organizational structure, the Company has three reportable segments: the Aerostructures Group, the Aerospace Systems Group and the Aftermarket Services Group.

The Aerostructures segment consists of the Company's operations that manufacture products primarily for the aerospace OEM market. The Aerostructures segment's revenues are derived from the design, manufacture, assembly and integration of metallic and composite aerostructures and structural components, including aircraft wings, fuselage sections, tail assemblies, engine nacelles, flight control surfaces, and helicopter cabins. Further, the segment's operations also design and manufacture composite assemblies for floor panels and environmental control system ducts. These products are sold to various aerospace OEMs on a global basis.

The Aerospace Systems segment consists of the Company's operations that also manufacture products primarily for the aerospace OEM market. The segment's operations design and engineer mechanical and electromechanical controls, such as hydraulic systems, main engine gearbox assemblies, engine control systems, accumulators, mechanical control cables and non-structural cockpit components. These products are sold to various aerospace OEMs on a global basis.

The Aftermarket Services segment consists of the Company's operations that provide maintenance, repair and overhaul services to both commercial and military markets on components and accessories manufactured by third parties. Maintenance, repair and overhaul revenues are derived from services on auxiliary power units, airframe and engine accessories, including constant-speed drives, cabin compressors, starters and generators, and pneumatic drive units. In addition, the segment's operations repair and overhaul thrust reversers, nacelle components and flight control surfaces. The segment's operations also perform repair and overhaul services and supply spare parts for various types of cockpit instruments and gauges for a broad range of commercial airlines on a worldwide basis.

Repair services generally involve the replacement of parts and/or the remanufacture of parts, which is similar to the original manufacture of the part. The processes that the Company performs related to repair and overhaul services are essentially the repair of wear parts or replacement of parts that are beyond economic repair. The repair service generally involves remanufacturing a complete part or a component of a part.

The accompanying consolidated financial statements include the accounts of Triumph and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated from the consolidated financial statements.

The preparation of 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.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash Equivalents

Cash equivalents consist of highly liquid investments with a maturity of three months or less at the time of purchase. Fair value of cash equivalents approximates carrying value.

Trade and Other Receivables, net

Trade and other receivables are recorded net of an allowance for doubtful accounts. Trade and other receivables include amounts billed and currently due from customers, amounts currently due but unbilled, certain estimated contract changes and amounts retained by the customer pending contract completion. Unbilled amounts are generally billed and collected within one year. The Company performs ongoing credit evaluations of its customers and generally does not require collateral. The Company records the allowance for doubtful accounts based on prior experience and for specific collectibility matters when they arise. The Company writes off balances against the reserve when collectibility is deemed remote. The Company's trade and other receivables are exposed to credit risk; however, the risk is limited due to the diversity of the customer base.

Trade and other receivables, net comprised of the following:

	March 31,
	2016				2015
Billed	$	407,275			$	475,668
Unbilled	25,742				39,222
Total trade receivables	433,017				514,890
Other receivables	17,683				13,186
Total trade and other receivables	450,700				528,076
Less: Allowance for doubtful accounts	(6,492		)		(6,475		)
Total trade and other receivables, net	$	444,208			$	521,601

Inventories

The Company records inventories at the lower of cost (average-cost or specific-identification methods) or market. Costs on long-term contracts and programs in progress represent recoverable costs incurred for production or contract-specific facilities and equipment, allocable operating overhead and advances to suppliers. Pursuant to contract provisions, agencies of the U.S. Government and certain other customers have title to, or a security interest in, inventories related to such contracts as a result of advances, performance-based payments, and progress payments. The Company reflects those advances and payments as an offset against the related inventory balances. The Company expenses general and administrative costs related to products and services provided essentially under commercial terms and conditions as incurred. The Company determines the costs of inventories by the first-in, first-out or average cost methods.

Work-in-process inventory includes capitalized pre-production costs. Company policy allows for the capitalization of pre-production costs after it establishes a contractual arrangement with a customer that explicitly states that the cost of recovery of pre-production costs is allowed.

Capitalized pre-production costs include nonrecurring engineering, planning and design, including applicable overhead, incurred before production is manufactured on a regular basis. Significant customer-directed work changes can also cause pre-production costs to be incurred (see Note 5 for further discussion).

Advance Payments and Progress Payments

Advance payments and progress payments received on contracts-in-process are first offset against related contract costs that are included in inventory, with any excess amount reflected in current liabilities under the Accrued expenses caption within the accompanying Consolidated Balance Sheets.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

Property and Equipment

Property and equipment, which includes equipment under capital lease and leasehold improvements, are recorded at cost and depreciated over the estimated useful lives of the related assets, or the lease term if shorter in the case of leasehold improvements, by the straight-line method. Buildings and improvements are depreciated over a period of 15 to 39.5 years, and machinery and equipment are depreciated over a period of 7 to 15 years (except for furniture, fixtures and computer equipment which are depreciated over a period of 3 to 10 years).

Goodwill and Intangible Assets

The Company accounts for purchased goodwill and intangible assets in accordance with Accounting Standards Codification ("ASC") 350, Intangibles—Goodwill and Other. Under ASC 350, purchased goodwill and intangible assets with indefinite lives are not amortized; rather, they are tested for impairment on at least an annual basis. Intangible assets with finite lives are amortized over their useful lives. Upon acquisition, critical estimates are made in valuing acquired intangible assets, which include but are not limited to: future expected cash flows from customer contracts, customer lists, and estimating cash flows from projects when completed; tradename and market position, as well as assumptions about the period of time that customer relationships will continue; and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from the assumptions used in determining the fair values.

The Company's operating segments of Aerostructures, Aerospace Systems and Aftermarket Services are also its reporting units. The Chief Executive Officer is the Company's Chief Operating Decision Maker ("CODM"). The Company's CODM evaluates performance and allocates resources based upon review of segment information. Each of the operating segments is comprised of a number of operating units which are considered to be components. The components, for which discrete financial information exists, are aggregated for purposes of goodwill impairment testing. The Company's acquisition strategy is to acquire companies that complement and enhance the capabilities of the operating segments of the Company. Each acquisition is assigned to either the Aerostructures reporting unit, the Aerospace Systems reporting unit or the Aftermarket Services reporting unit. The goodwill that results from each acquisition is also assigned to the reporting unit to which the acquisition is allocated, because it is that reporting unit which is intended to benefit from the synergies of the acquisition.

The Company assesses whether goodwill impairment exists using both the qualitative and quantitative assessments. The qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment the Company determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount or if the Company elects not to perform a qualitative assessment, a quantitative assessment is performed using a two-step approach required by ASC 350 to determine whether a goodwill impairment exists at the reporting unit.

The first step of the quantitative test is to compare the carrying amount of the reporting unit's assets to the fair value of the reporting unit. If the fair value exceeds the carrying value, no further evaluation is required and no impairment loss is recognized. If the carrying amount exceeds the fair value, then the second step is required to be completed, which involves allocating the fair value of the reporting unit to each asset and liability using the guidance in ASC 805, with the excess being applied to goodwill. An impairment loss occurs if the amount of the recorded goodwill exceeds the implied goodwill. The determination of the fair value of our reporting units is based, among other things, on estimates of future operating performance of the reporting unit being valued. We are required to complete an impairment test for goodwill and record any resulting impairment losses at least annually. Changes in market conditions, among other factors, may have an impact on these estimates and require interim impairment assessments.

When performing the two-step quantitative impairment test, the Company's methodology includes the use of an income approach which discounts future net cash flows to their present value at a rate that reflects the Company's cost of capital, otherwise known as the discounted cash flow method ("DCF"). These estimated fair values are based on estimates of future cash flows of the businesses. Factors affecting these future cash flows include the continued market acceptance of the products and services offered by the businesses, the development of new products and services by the businesses and the underlying cost of development, the future cost structure of the businesses, and future technological changes. The Company also incorporates market multiples for comparable companies in determining the fair value of our reporting units. Any such impairment would be recognized in full in the reporting period in which it has been identified.

During the third quarter of fiscal 2016, the Company performed an interim assessment of the fair value of our goodwill and indefinite-lived intangible assets due to potential indicators of impairment related to the continued decline in our stock price during the third quarter. The Company's assessment focused on the Aerostructures reporting unit since it had significant

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

changes in its economic indicators and adjusted for select changes in the risk adjusted discount rate to consider both the current return requirements of the market and the risks inherent in the reporting unit, expected long-term growth rate and cash flow projections to determine if any decline in the estimated fair value of a reporting unit could result in a goodwill impairment. We concluded that the goodwill was not impaired as of the interim impairment assessment date. However, the excess of the fair value over the carrying value was within 5% for the Company's Aerostructures reporting unit. The amount of goodwill for our Aerostructures reporting unit amounted to $1,420,195 as of the interim testing date.

In the fourth quarter of fiscal 2016, the Company performed the quantitative assessment for each of the Company's three reporting units, which indicated that the fair value of goodwill for the Aerostructures reporting unit did not exceed its carrying amount. After evaluating whether other assets within the reporting unit were impaired in accordance with ASC 350, we concluded on the implied goodwill under Step 2 resulting in a $597,603 impairment of goodwill to Aerostructures reporting unit. The assessment for the Company's Aerospace Systems and Aftermarket Services reporting units indicated that the fair value of their respective goodwill exceeded the carrying amount. We incurred no impairment of goodwill as a result of our annual goodwill impairment tests in fiscal 2015 or 2014 (see Note 7 for further discussion).

As of March 31, 2015, the Company had a $438,400 indefinite-lived intangible asset associated with the tradenames acquired in the acquisitions of Vought Aircraft Industries, Inc. ("Vought") and Embee, Inc. ("Embee"). The Company assesses whether indefinite-lived intangible assets impairment exists using both the qualitative and quantitative assessments. The qualitative assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount. If based on this qualitative assessment, the Company determines it is not more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount or if the Company elects not to perform a qualitative assessment, a quantitative assessment is performed to determine whether an indefinite-lived intangible asset impairment exists. We test the indefinite-lived intangible assets for impairment by comparing the carrying value to the fair value based on current revenue projections of the related operations, under the relief from royalty method. Any excess of the carrying value over the amount of fair value is recognized as an impairment.

During the third quarter of the fiscal year ended March 31, 2016, the Company performed an interim assessment of fair value on our indefinite-lived intangible assets due to indicators of impairment related to the continued decline in our stock price during the fiscal third quarter. Based on the Company's evaluation,the Company concluded that the Vought tradename had a fair value of $195,800 (Level 3) compared to a carrying value of $425,000. Accordingly, the Company recorded a non-cash impairment charge during the fiscal year ended March 31, 2016, of $229,200, which is presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets". The decline in fair value compared to the carrying value of the Vought tradename is the result of declining revenues from production rate reductions and the slower than previously projected ramp in Bombardier Global 7000/8000 and the timing of associated earnings.

In the fourth quarter of fiscal 2016, the Company performed its annual impairment test for each of the Company's indefinite-lived intangible assets, which indicated that the Vought and Embee tradenames had a fair value of $163,000 (Level 3) compared to a carrying value of $209,200. The decline in fair value of the tradenames is the result of the increase in discount rate during the fourth quarter, which required the Company to assess whether events and/or circumstances have changed regarding the indefinite-life conclusion. As a result the Company incurred a non-cash impairment charge of $46,200 presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets" to the Vought and Embee tradenames. Additionally, it was determined that the tradenames will be amortized over their remaining estimated useful life of 20 years. The Company incurred no impairment of indefinite-lived assets as a result of our annual indefinite-lived assets impairment tests in fiscal 2015 or 2014.

Finite-lived intangible assets are amortized over their useful lives ranging from 3 to 32 years. The Company continually evaluates whether events or circumstances have occurred that would indicate that the remaining estimated useful lives of long-lived assets, including intangible assets, may warrant revision or that the remaining balance may not be recoverable. Intangible assets are evaluated for indicators of impairment. When factors indicate that long-lived assets, including intangible assets, should be evaluated for possible impairment, an estimate of the related undiscounted cash flows over the remaining life of the long-lived assets, including intangible assets, is used to measure recoverability. Some of the more important factors management considers include the Company's financial performance relative to expected and historical performance, significant changes in the way the Company manages its operations, negative events that have occurred, and negative industry and economic trends. If the estimated fair value is less than the carrying amount, measurement of the impairment will be based on the difference between the carrying value and fair value of the asset group, generally determined based on the present value of expected future cash flows associated with the use of the asset.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

Deferred Financing Costs

Financing costs are deferred and amortized to Interest expense and other in the accompanying Consolidated Statements of Operations over the related financing period using the effective interest method or the straight-line method when it does not differ materially from the effective interest method. The Company records deferred financing costs as a direct deduction from the carrying value of that debt liability; however, the policy does exclude deferred financing costs relating to revolving debt instruments. These deferred financing costs are recorded in Other, net in the accompanying Consolidated Balance Sheets as of March 31, 2016 and 2015. Total deferred financing costs, net of accumulated amortization of $14,131 and $17,850, respectively, are recorded as of March 31, 2016 and 2015. Make-whole payments in connection with early debt retirements are classified as cash flows used in financing activities.

Acquired Contract Liabilities, net

In connection with several of our acquisitions, we assumed existing long-term contracts. Based on our review of these contracts, we concluded that the terms of certain contracts to be either more or less favorable than could be realized in market transactions as of the date of the acquisition. As a result, we recognized acquired contract liabilities, net of acquired contract assets as of the acquisition date of each respective acquisition, based on the present value of the difference between the contractual cash flows of the executory contracts and the estimated cash flows had the contracts been executed at the acquisition date. The liabilities principally relate to long-term life of program contracts that were initially executed at several years prior to the respective acquisition (see Note 3 for further discussion).

The Company measured these net liabilities in the year they were acquired under the measurement provisions of ASC 820, Fair Value MeasurementsMeasurement, which is based on the price to transfer the obligation to a market participant at the measurement date, assuming that the net liabilities will remain outstanding in the marketplace. Fair value estimates are based on a complex series of judgments about future events and uncertainties and rely heavily on estimates and assumptions. The judgments used to determine the estimated fair value assigned to each long-term contracts can materially impact our results of operations.

Included in the net salesportion of the Aerostructure and Aerospace Systems groups isCompany's revenue resulting from transactions other than contracts with customers pertains to the non-cash amortization of these acquired contract liabilities recognized as fair value adjustments through purchase accounting from various acquisitions. The Company recognized net amortization of contract liabilities of $132,363, $75,733 and $42,629 in the fiscal years ended March 31, 2016, 2015 and 2014, respectively, and such amounts have been included in revenues in results of operations. liabilities.

The balance of the liability as of March 31, 20162020, is $522,680$92,962 and, based on the expected delivery schedule of the underlying contracts, the Company estimates annual amortization of the liability as follows: 20172021 —$125,241; 2018 $44,958; 2022 —$117,544; 2019 $17,568; 2023 —$77,990; 2020 $7,302; 2024 —$59,660; $3,512; 2025 — $1,690; thereafter $17,932.

Leases

The Company leases office space, manufacturing facilities, land, vehicles, and 2021—$59,659.

Revenue Recognition

Revenuesequipment. The Company determines if an agreement is or contains a lease at the lease inception date and recognizes right-of-use assets and lease liabilities at the lease commencement date. A ROU asset and corresponding lease liability are generally recognized in accordancenot recorded for leases with an initial term of 12 months or less (“short-term leases”).

ROU assets represent the contractCompany's right to use an underlying asset during the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease. The determination of the length of lease terms is affected by options to extend or terminate the lease when products are shipped, delivery has occurred or services have been rendered, pricing is fixed or determinable, and collectionit is reasonably assured. The Company's policy with respect to sales returns and allowances generally providescertain that the customer mayCompany will exercise that option. The existence of significant economic incentive is the primary consideration when assessing whether the Company is reasonably certain of exercising an option in a lease. Both finance and operating lease ROU assets and liabilities are recognized at commencement date and measured as the present value of lease payments to be made over the lease term. As the interest rate implicit in the lease is not return products or be given allowances, except at the Company's option. Accrualsreadily available for sales returns, other allowances and estimated warranty costs are provided at the time of shipment based upon past experience.

A significant portionmost of the Company's contracts are within the scope of ASC 605-35, Revenue Recognition —Construction-Type and Production-Type Contracts, and revenue and costs on contracts are recognized using the percentage-of-completion method of accounting. Accounting for the revenue and profit on a contract requires estimates of (1) the contract value or total contract revenue, (2) the total costs at completion, which is equal to the sum of the actual incurred costs to date on the contract and the estimated costs to complete the contract's scope of work and (3) the measurement of progress towards completion. Depending on the contract,leases, the Company measures progress toward completion using eitheruses its estimated incremental borrowing rate in determining the cost-to-cost method orpresent value of lease payments. The estimated incremental borrowing rate is derived from information available at the units-of-delivery method, with the great majority measured under the units-of-delivery method.

Under the cost-to-cost method, progress toward completionlease commencement date. The lease ROU asset recognized at commencement is measured as the ratio of totaladjusted for any lease payments related to initial direct costs, incurred to estimated total costs at completion. Costs are recognized as incurred. Profit is determined based on estimated profit margin on the contract multiplied by progress toward completion. Revenue represents the sum of costsprepayments, and profit on the contract for the period.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

Under the units-of-delivery method, revenue on a contract is recorded as the units are delivered and accepted during the period at an amount equal to the contractual selling price of those units. The costs recorded on a contract under the units-of-delivery method are equal to the total costs at completion divided by the total units to be delivered. As contracts can span multiple years, the Company often segments the contracts into production lots for the purposes of accumulating and allocating cost. Profit is recognized as the difference between revenue for the units delivered and the estimated costs for the units delivered.

Adjustments to original estimates for a contract's revenues, estimated costs at completion and estimated total profit are often required as work progresses under a contract, as experience is gained and as more information is obtained, even though the scope of work required under the contract may not change, or if contract modifications occur. These estimates are also sensitive to the assumed rate of production. Generally, the longer it takes to complete the contract quantity, the more relative overhead that contract will absorb. The impact of revisions in cost estimateslease incentives.

For operating leases, lease expense is recognized on a cumulative catch-upstraight-line basis over the lease term. For finance leases, lease expense comprises the amortization of the ROU assets recognized on a straight-line basis generally over the shorter of the lease term or the estimated useful life of the underlying asset and interest on the lease liability. Variable lease payments not dependent on a rate or index are recognized when the event, activity, or circumstance in the period inlease agreement upon which the revisionsthose payments are made. Provisions for anticipated losses on contractscontingent is probable of occurring and are recordedpresented in the period in which they become probable ("forward losses") and are first offset against costs that are included in inventory, with any remaining amount reflected in accrued contract liabilities in accordance with ASC 605-35. Revisions in contract estimates, if significant, can materially affect results of operations and cash flows, as well as valuation of inventory. Furthermore, certain contracts are combined or segmented for revenue recognition in accordance with ASC 605-35.

For the fiscal year ended March 31, 2016, cumulative catch-up adjustments resulting from changes in contract values and estimated costs that arose during the fiscal year decreased operating (loss) income, net (loss) income and earnings per share by approximately $(596,213), $(539,023) and $(10.95), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2016 included gross favorable adjustments of approximately $32,954 and gross unfavorable adjustments of approximately $(629,167), which includes provisions for forward losses of $561,158 on the Bombardier Global 7000/8000 ("Bombardier") and 747-8 programs.

For the fiscal year ended March 31, 2015, cumulative catch-up adjustments resulting from changes in estimates decreased operating income, net income and earnings per share by approximately $(156,048), $(106,639) and $(2.09), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2015 included gross favorable adjustments of approximately $4,653 and gross unfavorable adjustments of approximately $(160,701) which includes a provision for forward losses of $151,992 on the 747-8 program.

For the fiscal year ended March 31, 2014, cumulative catch-up adjustments resulting from changes in estimates decreased operating income, net income and earnings per share by approximately $(53,166) $(35,121) and $(0.67), respectively. The cumulative catch-up adjustments to operating income for the fiscal year ended March 31, 2014 included gross favorable adjustments of approximately $14,341 and gross unfavorable adjustments of approximately $(67,507).

Amounts representing contract change orders or claims are only included in revenue when such change orders or claims have been settled with the customer and to the extent that units have been delivered. Additionally, some contracts may contain provisions for revenue sharing, price re-determination, requests for equitable adjustments, change orders or cost and/or performance incentives. Such amounts or incentives are included in contract value when the amounts can be reliably estimated and their realization is reasonably assured.

Although fixed-price contracts, which extend several years into the future, generally permit the Company to keep unexpected profits if costs are less than projected, the Company also bears the risk that increased or unexpected costs may reduce profit or cause the Company to sustain losses on the contract. In a fixed-price contract, the Company must fully absorb cost overruns, notwithstanding the difficulty of estimating allsame line of the costsconsolidated balance sheet as the Company will incur in performing these contracts and in projecting the ultimate level of revenue that may otherwise be achieved.

rent expense arising from fixed payments. The Company recognized a provision for forward losses associatedhas lease agreements with our long-term contracts on the 747-8lease and Bombardier programs. There is still risk similar to what we have experienced on the 747-8 and Bombardier programs. Particularly, our ability to manage risks related to supplier performance, execution of cost reduction strategies, hiring and retaining skilled production and management personnel, quality and manufacturing execution, program schedule delays and many other risks, will determine the ultimate performance of these long-term programs.

The Aftermarket Services Group provides repair and overhaul services, certain of which servicesnon-lease components. Non-lease components are provided under long-term power-by-the-hour contracts, comprising approximately 6% of the segment's net sales. The Company applies the proportional performance method to recognize revenue under these contracts. Revenue is recognized over the contract period as units are delivered based on the relative value in proportion to the total estimated contract consideration. In estimating the total contract consideration, management evaluates the projected utilization of its customer's fleet over the term of the contract,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

in connectioncombined with the related estimated repairlease components and overhaul servicing requirements to the fleet based on such utilization. Changes in utilizationaccounted for as lease components for all classes of the fleet by customers, among other factors, may have an impact on these estimates and require adjustments to estimates of revenue to be realized.

Shipping and Handling Costs

The cost of shipping and handling products is included in cost of products sold.

Research and Development Expense

Research and development ("R&D") expense (which includes certain amounts subject to reimbursement from customers) was approximately $103,031, $108,062 and $82,494 for the fiscal years ended March 31, 2016, 2015 and 2014, respectively.

underlying assets.

Retirement Benefits

Defined benefit pension plans are recognized in the consolidated financial statements on an actuarial basis. A significant element in determining the Company's pension income (expense) is the expected long-term rate of return on plan assets. This expected return is an assumption as to the average rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the projected pension benefit obligation. The Company applies this assumed long-term rate of return to a calculated value of plan assets, which recognizes changes in the fair value of plan assets in a systematic manner over five years. This produces the expected return on plan assets that is included in pension income (expense). The difference between this expected return and the actual return on plan assets is deferred. The net deferral of past asset gains (losses) affects the calculated value of plan assets and, ultimately, future pension income (expense).

The Company periodically experiences events or makes changes to its benefit plans that result in curtailment or special charges. Curtailments are recognized when events occur that significantly reduce the expected years of future service of present employees or eliminates the benefits for a significant number of employees for some or all of their future service.

Curtailment losses are recognized when it is probable the curtailment will occur and the effects are reasonably estimable. Curtailment gains are recognized when the related employees are terminated or a plan amendment is adopted, whichever is applicable.

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Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

From time to time, the Company may enter into transactions that relieve it of primary responsibility for all or more than a minor portion of certain of its pension benefit obligations.  When these transactions are effected through an irrevocable action that relieves the Company of primary responsibility for its pension or other postretirement benefit obligations and eliminates significant risks related to the obligation and the related assets used to effect the transaction, they are considered settlements, as defined by ASC 715, Compensation – Retirement Benefits.  When a transaction meets the definition of a settlement, at the time of settlement the Company recognizes as a gain or loss the pro rata amount of the net gain or loss in accumulated other comprehensive income based on the proportion of the projected benefit obligation settled to the total projected benefit obligation.  

As required under ASC 715,Compensation — Retirement Benefits, the Company remeasures plan assets and obligations during an interim period whenever a significant event occurs that results in a material change in the net periodic pension cost. The determination of significance is based on judgment and consideration of events and circumstances impacting the pension costs.

At March 31 of each year, the Company determines the fair value of its pension plan assets as well as the discount rate to be used to calculate the present value of plan liabilities. The discount rate is an estimate of the interest rate at which the pension benefits could be effectively settled. In estimating the discount rate, the Company looks to rates of return on high-quality, fixed-income investments currently available and expected to be available during the period to maturity of the pension benefits. The Company uses a portfolio of fixed-income securities, which receive at least the second-highest rating given by a recognized ratings agency.

Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. When determining fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and also considers assumptions that market participants would use when pricing an asset or liability. The fair value hierarchy has three levels of inputs that may be used to measure fair value: Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2—Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability; and Level 3—Unobservable inputs for the asset or liability. The Company has applied fair value measurements to its interest rate swapwhen measuring goodwill impairment in fiscal year 2018 and fiscal year 2020 (see Note 10)7), and to its pension and postretirement plan assets (see Note 15).

Foreign Currency Translation

The determination of the functional currency for the Company's foreign subsidiaries is made based on appropriate economic factors. The functional currency of the Company's subsidiaries Triumph Aviation Services—Asia and Triumph Structures—Thailand is the U.S. dollar since that is the currency in which that entity primarily generates and expends cash. The functional currency of the Company's remaining subsidiaries is the local currency, since that is the currency in which those

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

entities primarily generate and expend cash. Assets and liabilities of these subsidiaries are translated at the rates of exchange at the balance sheet date. Income and expense items are translated at average monthly rates of exchange. The resultant translation adjustments are included in accumulated other comprehensive income (see Note 13). Gains and losses arising from foreign currency transactions of these subsidiaries are included in net (loss) income.

Income Taxes

The Company accounts for income taxes using the asset and liability method. The asset and liability method requires recognition of deferred tax assets and liabilities for expected future tax consequences of temporary differences that currently exist between tax bases and financial reporting bases of the Company's assets and liabilities. A valuation allowance is provided on deferred taxes if it is determined that it is more likely than not that the asset will not be realized. The Company recognizes penalties and interest accrued related to income tax liabilities in the provision for income taxes in its Consolidated Statements of Operations.

Significant management

Management judgment is required to determine the amount of benefit to be recognized in relation to an uncertain tax position. The Company uses a two-step process to evaluate tax positions. The first step requires an entity to determine whether it is more likely than not (greater than 50% chance) that the tax position will be sustained. The second step requires an entity to recognize in the financial statements the benefit of a tax position that meets the more-likely-than-not recognition criterion. The amounts ultimately paid upon resolution of issues raised by taxing authorities may differ materially from the amounts accrued and may materially impact the financial statements of the Company in future periods.

Recently Issued Accounting Pronouncements

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842). ASU 2016-02 requires lessees to recognize assets and liabilities for most leases. ASU 2016-02 is effective for annual periods beginning after December 15, 2018. Early adoption is permitted. Full retrospective application is prohibited. ASU 2016-02's transition provision are applied using a modified retrospective approach at the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating ASU 2016-02 and has not determined the impact it may have on the Company’s consolidated results of operations, financial position or cash flows nor decided on the method of adoption.

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Subtopic 740-10): Balance Sheet Classification of Deferred Taxes. ASU 2015-17 requires companies to classify all deferred tax assets and liabilities as noncurrent on the balance sheet instead of separating deferred taxes into current and noncurrent amounts. ASU 2015-17 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is allowed for financial statements that have not been previously issued. Entities may elect to adopt the guidance either prospectively or retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). Effective December 1, 2015, the Company adopted this standard retrospectively to all prior periods and resulting in a reclass of $145,352 from a current deferred tax asset to a noncurrrent deferred tax liability on the Consolidated Balance Sheet. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows.

In September 2015, the FASB issued ASU 2015-16, Business Combinations(Topic 805): Simplifying the Accounting for Measurement-Period Adjustments. ASU 2015-16 eliminates the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Instead, an acquirer will recognize a measurement-period adjustment during the period in which it determines the amount of the adjustment. ASU 2015-16 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted. The Company adopted this standard effective January 1, 2016. The adoption did not have a material impact on the Company's financial position, results of operations or cash flows.

In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 requires companies to present debt issuance costs as a direct deduction from the carrying value of that debt liability. ASU 2015-03 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is allowed for financial statements that have not been previously issued. Entities would apply the new guidance retrospectively to all prior periods. Effective April 1, 2015, the Company adopted this standard. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows. In accordance with ASC 2015-15, the Company has excluded debt issuance costs relating to revolving debt instruments as a direct deduction to debt.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

In May 2014, the FASB issued guidance codified in Accounting Standards Codification ("ASC") 606, Revenue Recognition - Revenue from Contracts with Customers, which amends the guidance in former ASC 605, Revenue Recognition. The objective of ASC 606 is to establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most of the existing revenue recognition guidance. The principle of ASC 606 is that an entity will recognize revenue at the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled. ASC 606 is effective for interim and annual reporting periods beginning after December 15, 2017 and can be adopted by the Company using either a full retrospective or modified retrospective approach, with early adoption prohibited. The Company is currently evaluating ASC 606 and has not determined the impact it may have on the Company’s consolidated results of operations, financial position or cash flows nor decided on the method of adoption.

Stock-Based Compensation

The Company recognizes compensation expensepenalties and interest accrued related to income tax liabilities in the provision for share-based awards basedincome taxes on the fair valueits consolidated statements of those awards at the date of grant. Stock-based compensation expense for fiscal years ended March 31, 2016, 2015 and 2014 was $2,657, $1,272 and $4,653, respectively. The Company has classified share-based compensation within selling, general and administrative expenses to correspond with the same line item as the majority of the cash compensation paid to employees. Upon the exercise of stock options or vesting of restricted stock, the Company first transfers treasury stock, then will issue new shares (see Note 16 for further details).

operations.

Supplemental Cash Flow Information

For the fiscal yearsyear ended March 31, 2016 and 2014,2020, the Company paid $4,887 and $4,157, respectively, $4,005for income tax,taxes, net of income tax refunds received. For the fiscal year ended March 31, 2015,2019, the Company received $22,241 for$4,701 as income tax refunds, net of payments. The Company made interest payments of $62,325, $82,425 and $81,100 for fiscal years ended March 31, 2016, 2015 and 2014, respectively.

During the fiscal years ended March 31, 2016, 2015 and 2014, the Company financed $188, $52 and $36 of property and equipment additions through capital leases, respectively. Duringtaxes paid.  For the fiscal year ended March 31, 2014,2018, the Company issued 2,290,755 shares in connection with certain redemptionspaid $11,190 for income taxes, net of convertible senior subordinated notes (see Note 10).

Warranty Reserves

A reserve has been establishedincome tax refunds received.

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Notes to provide for the estimated future cost of warranties on our delivered products. The Company periodically reviews the reserves and adjustments are made accordingly. A provision for warranty on products delivered is made on the basis of historical experience and identified warranty issues. Warranties cover such factors as non-conformance to specifications and defects in material and workmanship. The majority of the Company's agreements include a three-year warranty, although certain programs have warranties up to 20 years. Warranty reserves are included in accrued expenses and other noncurrent liabilities on the Consolidated Balance Sheet. The warranty reserves for the fiscal years ended March 31, 2016 and 2015, were $112,937 and $112,140, respectively, of which a significant portion is offset by an indemnification asset.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Financial Statements

(Dollars in thousands, except per share data)

3.	ACQUISITIONS

Acquisition of Fairchild Controls Corporation

Effective October 21, 2015,

3.    DIVESTED OPERATIONS AND ASSETS HELD FOR SALE

Fiscal 2020 Divestitures

In December 2019, the Company acquired allcompleted the sale of its manufacturing operations at its Nashville, TN, facility for cash proceeds net of transaction costs of approximately $58,000, including approximately $7,000 allocated as a premium paid by the buyer in exchange for a specified performance guarantee.  The Company recognized a loss of approximately $64,000, which is presented on the accompanying consolidated statements of operations within loss on sale of assets and businesses.  The operating results of the outstanding shares of Fairchild Controls Corporation ("Fairchild"). Fairchild is a leading provider of proprietary thermal management systems, auxiliary power generation systems and related aftermarket spares and repairs. The acquired business operates as Triumph Thermal Systems-Maryland, Inc. and its resultsNashville manufacturing operations are included in Aerospace Systems GroupStructures through the date of divestiture.  Additionally, as part of the transaction, the Company agreed to transfer to the buyer, within 120 days from the date of acquisition.

The purchase priceclosing, certain defined benefit pension assets and obligations of approximately $55,000 associated with the Nashville manufacturing operations.  In accordance with applicable defined benefit pension plan accounting guidance, the transfer was treated as a settlement for Fairchild was $57,130, including a working capital adjustments. Goodwillpurposes of the Company’s financial statements and resulted in the amountaccelerated recognition of $16,529 was provisionally recognized for this acquisition and is calculated as the excess of consideration transferred over the net assets recognized and represents future economic benefits arising from other assets acquired that could not be individually identified and separately recognized such as assembled workforce. The goodwill is not deductible for tax purposes.previously unrecognized actuarial losses.  The Company has also identified an intangible asset related to customer relationships valued at $18,000completed the transfer of the defined benefit pension assets and obligations in March 2020 and recognized a one-time settlement loss of approximately $28,000.

In September 2019, the Company completed the assignment of its E-2 Jets contract with a weighted-average life of 12.0 years.

The accountingEmbraer for the business combination is provisional and dependent upon valuations and other informationmanufacture of structural components for their program to AeroSpace Technologies of Korea Inc. ("ASTK").  As part of this transaction, the Company transferred certain assets and liabilities to ASTK and recognized a gain of approximately $10,000, which have not yet been identified, completed or obtained to a point where definitive estimates can be made. The process for estimatingis presented on the fair valuesaccompanying consolidated statements of identified intangible assets, certain tangibleoperations within loss on sale of assets and assumed liabilities requires the use of judgment to determine the appropriate assumptions.

As the Company finalizes estimates of the fair value of certainbusinesses.  The assets acquired and liabilities assumed, the purchase price allocation for Fairchild is provisional. Additional purchase price adjustments will be recorded during the measurement period, not to exceed one year beyond the acquisition date. These adjustments may have a material impact on the Company's results of operations and financial position.

The table below presents the provisional estimated fair value of assets acquired and liabilities assumed on the acquisition date based on the best information the Company has received to date, in accordance with Accounting Standards Codification Topic 805, Business Combinations ("ASC 805"). These estimates will be revised as the Company finalizes valuations of tangible and intangible assets, certain liabilities assumed and other information related to the Fairchild acquisition. Accordingly, the amounts below report the Company's best estimate of fair value based on the information available at this time:

	October 21, 2015
Cash	$	9,065
Accounts receivable	8,859
Inventory	15,069
Prepaid expenses	263
Property and equipment	6,632
Goodwill	16,529
Intangible assets	18,000
Deferred taxes	3,992
Total assets	$	78,409
Accounts payable	$	1,284
Accrued expenses	12,128
Other noncurrent liabilities	7,867
Total liabilities	$	21,279

The provisional amounts recognized are based on the Company's best estimate using information that it has obtained as of the reporting date. The Company will finalize its estimate once it is able to determine that it has obtained all necessary information that existed as of the acquisition date related to this matter or one year following the acquisition of Fairchild, whichever is earlier.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

The Fairchild acquisition has been accounted for under the acquisition method and, accordingly, istransferred were included in the consolidated financial statements from the effective date of acquisition. The Company incurred $569 in acquisition-related costs in connection with the Fairchild acquisition.

The following table presents information for the Fairchild acquisition which are included in the Company's Consolidated Statements of Operations from its date of acquisitionwithin Aerospace Structures through the end of fiscal 2016:

		For the Year Ended March 31, 2016
Net sales		$	17,698
Operating income		1,792

FISCAL 2015 ACQUISITIONS

Assumption of Spirit AeroSystems Holdings, Inc. - Gulfstream G650 and G280 Wing Programs

Effective December 30, 2014, a wholly-owned subsidiary of the Company, Triumph Aerostructures - Tulsa LLC, doing business as Triumph Aerostructures-Vought Aircraft Division-Tulsa, completed the acquisition of the Gulfstream G650 and G280 wing programs (the "Tulsa Programs") located in Tulsa, Oklahoma, from Spirit AeroSystems, Inc. The acquisition of the Tulsa Programs establishes the Company as a leader in fully integrated wing design, engineering and production and advances its standing as a strategic Tier One Capable aerostructures supplier. The acquired business operates as Triumph Aerostructures-Vought Aircraft Division-Tulsa and its results are included in the Aerostructures Group from the date of acquisition.

The Company received $160,000 in cash plus assets required to run the business from Spirit-Tulsa to cover the anticipated future cash flow needs of the programs. Goodwill in the amount of $80,122 was recognized for this acquisition and is calculated as the excess of consideration transferred over the net assets recognized and represents future economic benefits arising from other assets acquired that could not be individually identified and separately recognized such as assembled workforce. The goodwill is not deductible for tax purposes.

The following condensed balance sheet represents the amounts assigned to each major asset and liability caption in the aggregate from the acquisition for the Tulsa Programs, in accordance with ASC 805:

	December 30, 2014
Inventory	$	78,660
Property and equipment	15,409
Goodwill	80,122
Deferred taxes	52,777
Other noncurrent assets	68,941
Total assets	$	295,909
Accounts payable	$	1,782
Accrued expenses	17,588
Acquired contract liabilities	368,448
Other noncurrent liabilities	68,091
Total liabilities	$	455,909

Based on the information accumulated during the measurement period, the Company has recognized an accrued warranty liability of $74,132 and a related indemnification asset of $68,941 for amounts reimbursed by the seller. The Company finalized its estimates after it was able to determine that it had obtained all necessary information that existed as of the acquisition date related to these matters.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

The Tulsa Programs acquisition has been accounted for under the acquisition method and, accordingly, is included in the consolidated financial statements from the effective date of acquisition. The Company incurred $5,000 in acquisition-related costs in connection with the Tulsa Programs acquisition, which is recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations.

Acquisition of North American Aircraft Services, Inc.

Effective October 17, 2014, the Company acquired the ownership of all of the outstanding shares of North American Aircraft Services, Inc. and its affiliates ("NAAS"). NAAS is based in San Antonio, Texas, with fixed-based operator units throughout the United States as well as international locations and delivers line maintenance and repair, fuel leak detection and fuel bladder cell repair services. The acquired business operates as Triumph Aviation Services - NAAS Division and its results are included in Aftermarket Services Group from the date of acquisition.

The purchase price for the NAAS acquisition was $44,520, net of working capital adjustment of $167. Goodwill in the amount of $25,217 was recognized for this acquisition and is calculated as the excess of consideration transferred over the net assets recognized and represents future economic benefits arising from other assets acquired that could not be individually identified and separately recognized such as assembled workforce. The goodwill is not deductible for tax purposes. The Company has also identified an intangible asset related to customer relationships valued at $17,000 with a weighted-average life of 11.0 years.

The following condensed balance sheet represents the amounts assigned to each major asset and liability caption in the aggregate from the acquisition of NAAS, in accordance with ASC 805:

	October 17, 2014
Cash	$	818
Accounts receivable	4,939
Inventory	848
Property and equipment	216
Goodwill	25,217
Intangible assets	17,000
Other assets	225
Total assets	$	49,263
Accounts payable	$	232
Accrued expenses	911
Other noncurrent liabilities	3,600
Total liabilities	$	4,743

The Company finalized its estimates after it was able to determine that it had obtained all necessary information that existed as of the acquisition date related to these matters.

The NAAS acquisition has been accounted for under the acquisition method and, accordingly, is included in the consolidated financial statements from the effective date of acquisition. The NAAS acquisition was funded by the Company's long-term borrowings in place at the date of acquisition. The Company incurred $654 in acquisition-related costs in connection with the NAAS acquisition, which is recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations.

Acquisition of GE Aviation - Hydraulic Actuation

Effective June 27, 2014, the Company acquired the hydraulic actuation business of GE Aviation ("GE"). GE's hydraulic actuation business consists of three facilities located in Yakima, Washington, Cheltenham, England and the Isle of Man and is a technology leader in actuation systems. GE's key product offerings include complete landing gear actuation systems, door actuation, nose-wheel steerings, hydraulic fuses, manifolds flight control actuation and locking mechanisms for the commercial,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

military and business jet markets. The acquired business operates as Triumph Actuation Systems-Yakima and Triumph Actuation Systems-UK & IOM and its results are included in Aerospace Systems Group from the date of acquisition.

The purchase price for the GE acquisition was $75,609, which included cash paid at closing, working capital adjustments, and deferred payments of $6,000 paid in fiscal 2016. Goodwill in the amount of $150,772 was recognized for this acquisition and is calculated as the excess of consideration transferred over the net assets recognized and represents future economic benefits arising from other assets acquired that could not be individually identified and separately recognized such as assembled workforce. The goodwill is deductible for tax purposes. The Company has also identified an intangible asset related to customer relationships and technology valued at $26,472 with a weighted-average life of 12.0 years.

The following condensed balance sheet represents the amounts assigned to each major asset and liability caption in the aggregate from the acquisition of GE, in accordance with ASC 805:

	June 27, 2014
Cash	$	4,608
Accounts receivable	35,376
Inventory	49,585
Property and equipment	30,985
Goodwill	150,772
Intangible assets	26,472
Deferred taxes	63,341
Other assets	2,023
Total assets	$	363,162
Accounts payable	$	17,734
Accrued expenses	37,483
Acquired contract liabilities	232,336
Total liabilities	$	287,553

Based on the information accumulated through the measurement period and the Company's assessment of the probable outcome of warranty claims, the Company has recognized a liability of $24,514. The provisional amounts recognized are based on the Company's best estimate using information that it has obtained as of the reporting date. The Company finalized its estimates after it was able to determine that it had obtained all necessary information that existed as of the acquisition date related to these matters.

The GE acquisition has been accounted for under the acquisition method and, accordingly, is included in the consolidated financial statements from the effective date of acquisition. The GE acquisition was funded by the Company's long-term borrowings in place at the date of acquisition. The Company incurred $1,834 in acquisition-related costs in connection with the GE acquisition, which is recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations.

The acquisitions of the Tulsa Programs, NAAS and GE are referred to in this report as the "fiscal 2015 acquisitions."

FISCAL 2014 ACQUISITIONS

Acquisition of Insulfab Product Line (Chase Corporation)

Effective October 7, 2013, the Company's wholly-owned subsidiary, Triumph Insulation Systems, LLC, acquired substantially all of the assets comprising the Insulfab product line from Chase Corporation ("Insulfab"). Insulfab primarily focuses on manufacturing high-quality, engineered barrier laminates used in aerospace applications. The purchase price for the Insulfab acquisition was $7,394 in cash at closing and in January 2014, after the working capital was finalized the Company

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

paid $2,516 in cash. The results for Triumph Insulation Systems, LLC will continue to be included in the Aerostructures Group.

Acquisition of General Donlee Canada, Inc.

Effective October 4, 2013, the Company acquired all of the issued and outstanding shares of General Donlee Canada, Inc. ("General Donlee"). General Donlee is based in Toronto, Canada, and is a leading manufacturer of precision machined products for the aerospace, nuclear and oil and gas industries. The purchase price for the General Donlee acquisition was $56,622 plus assumed debt of $32,382, which was settled at closing. Additionally, on October 7, 2013, the Company, at its option, called General Donlee's Convertible Notes for $26,000, which were paid on November 12, 2013. The Company incurred $766 in acquisition-related costs in connection with the General Donlee acquisition, which is recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations. The acquired business now operates as Triumph Gear Systems-Toronto ULC and its results are included in the Aerospace Systems Group.

Acquisition of Primus Composites

Effective May 6, 2013, the Company acquired four related entities collectively comprising the Primus Composites ("Primus") business from Precision Castparts Corp. The acquired business, which includes two manufacturing facilities in Farnborough, England and Rayong, Thailand, operates as Triumph Structures - Farnborough and Triumph Structures - Thailand and is included in the Aerostructures Group. Together, Triumph Structures - Farnborough and Triumph Structures - Thailand constitute a global supplier of composite and metallic propulsion and structural composites and assemblies. divestiture.

Fiscal 2019 Divestitures

In addition to its composite operations, the Thailand operation also machines and processes metal components. The purchase price for the Primus acquisition was $33,530 in cash and $30,000 in assumed debt settled at closing. The Company incurred $743 in acquisition-related costs in connection with the Primus acquisition, which is recorded in selling, general and administrative expenses in the accompanying Consolidated Statements of Operations.

The acquisitions of Insulfab, General Donlee and Primus are referred to in this report as the "fiscal 2014 acquisitions."

4.	DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE

Sale of Triumph Aerospace Systems - Wichita

In January 2014,March 2019, the Company sold all of the shares of Triumph Aerospace Systems-Wichita,Structures – Kansas City, Inc.; Triumph Structures – Wichita, Inc.; Triumph Gear Systems – Toronto; ULC; and Triumph Northwest (The Triumph Group Operations, Inc.) (together, "Machining").  Total cash proceeds net of transaction costs for the sale of Machining was approximately $43,000.  A portion of the proceeds associated with the sale of Machining included consideration in the form of a note receivable of $10,000.   Upon closing, the Company recognized a loss of approximately $116,000.  An additional loss of approximately $3,000 was recognized during the fiscal 2020, as a result of working capital adjustments and additional transaction costs and is presented within loss on sale of assets and businesses on the accompanying condensed consolidated statements of operations.

In March 2019, the Company sold all of the shares of (i) Triumph Fabrications - San Diego, Inc. and Triumph Fabrications - Ft. Worth, Inc. (together, "Fabrications"), and (ii) Triumph Aviation Services - NAAS Division, Inc. ("TAS-Wichita"NAAS").  Total cash proceeds net of transaction costs for the sales of Fabrications and NAAS were approximately $133,000 and $18,000, respectively.  As a result of the sales of Fabrications, the Company recognized a gain of approximately $54,000.  The sale of NAAS resulted in an immaterial gain.

In February 2019, the Company transitioned responsibility for the Global 7500 wing program manufacturing operations of Aerospace Structures to Bombardier at which point Bombardier assumed the program’s assets and obligations.  As a result of this transfer, the Company recognized a loss of approximately $169,000.  The Company continues to provide transition services related to infrastructure support reducing in scope over the next several months, as well as a lease of the building in Red Oak, Texas, dedicated to the manufacturer of the Global 7500 wing to Bombardier.

In July and August 2018, respectively, the Company sold all of the shares of Triumph Structures - East Texas, Inc. as well as all of the shares of Triumph Structures - Los Angeles, Inc., and Triumph Processing, Inc. for combined cash proceeds net of transactions costs of approximately $43,000 and a note receivable of $7,000.  The note receivable was collected in October 2018.  As a result of these sales, the Company recognized losses of approximately $17,000, which are presented on the accompanying consolidated statements of operations within loss on sale of assets and businesses.

Fiscal 2018 Divestitures

In March 2018, the Company sold all of the shares of Triumph Structures - Long Island, LLC ("TS-LI") for total cash proceeds of $23,000.$9,500 and a note receivable of $1,400. The note receivable was collected in July 2018. As a result of the sale of TAS-Wichita,TS-LI, the Company recognized no gain or loss.a loss of $10,370. The operating results of TAS-WichitaTS-LI were included in the Aerostructures GroupAerospace Structures through the date of disposal.

The Company expects to have significant continuing involvement in the business and markets of the disposed entities, as defined by ASC 250-20, Discontinued Operations; and therefore as a result,the disposal group does not meet the criteria to be classified as discontinued operations.

Sale of Triumph Instruments - Burbank and Triumph Instruments - Ft. Lauderdale

divestiture.

In April 2013,September 2017, the Company sold all of the assets and liabilitiesshares of Triumph InstrumentsProcessing - Burbank and Triumph Instruments - Ft. LauderdaleEmbee Division, Inc. ("Triumph Instruments"Embee") for total cash proceeds of $11,200, including cash received at closing$64,986. As a result of $9,676 a notethe sale of $1,500, andEmbee, the remaining amount held in escrow and received in the second quarter of fiscal 2014, resulting inCompany recognized a loss of $1,462 recognized during the year ended March 31, 2013.$17,857. The operating results areof Embee were included in the Aftermarket Services GroupIntegrated Systems through the date of disposal.

The Company expectsdivestiture.

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Notes to have significant continuing involvement in the business and markets of the disposed entities, as defined by ASC 250-20, Discontinued Operations; and therefore as a result,the disposal group does not meet the criteria to be classified as discontinued operations.

To measure the amount of loss related to Triumph Instruments, the Company compared the fair value of assets and liabilities at the evaluation date to the carrying amount at the end of the month prior to the evaluation date. The sale of the Triumph Instruments assets and liabilities are categorized as Level 2 within the fair value hierarchy. The key assumption included the negotiated sales price of the assets and the assumptions of the liabilities (see Note 2 for definition of levels).

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Consolidated Financial Statements

(Dollars in thousands, except per share data)

5.	INVENTORIES

Inventories

4.    REVENUE RECOGNITION AND CONTRACTS WITH CUSTOMERS

Disaggregation of Revenue

The Company disaggregates revenue based on the method of measuring satisfaction of the performance obligation either over time or at a point in time. Additionally, the Company disaggregates revenue based upon the end market where products and services are statedtransferred to the customer. The Company’s principal operating segments and related revenue are discussed in Note 13, Segments.

The following table shows disaggregated net sales satisfied overtime and at a point in time (excluding intercompany sales) for the year ended March 31, 2020 and 2019:

		Year Ended March 31,
		2020				2019
Systems & Support
Satisfied over time		$	578,117			$	548,562
Satisfied at a point in time			738,158				726,791
Revenue from contracts with customers			1,316,275				1,275,353
Amortization of acquired contract liabilities			34,486				34,121
Total revenue			1,350,761				1,309,474
Aerospace Structures
Satisfied over time		$	1,378,866			$	1,832,422
Satisfied at a point in time			129,690				189,841
Revenue from contracts with customers			1,508,556				2,022,263
Amortization of acquired contract liabilities			40,800				33,193
Total revenue			1,549,356				2,055,456
		$	2,900,117			$	3,364,930

The following table shows disaggregated net sales by end market (excluding intercompany sales) for the year ended March 31, 2020 and 2019:

		Year Ended March 31,
		2020				2019
Systems & Support
Commercial aerospace		$	737,885			$	730,562
Military			436,166				409,027
Business jets			61,338				63,649
Regional			43,761				45,397
Non-aviation			37,125				26,718
Revenue from contracts with customers			1,316,275				1,275,353
Amortization of acquired contract liabilities			34,486				34,121
Total revenue		$	1,350,761			$	1,309,474
Aerospace Structures
Commercial aerospace		$	879,690			$	1,020,649
Military			116,846				237,501
Business jets			422,681				699,747
Regional			89,318				36,038
Non-aviation			21				28,328
Revenue from contracts with customers			1,508,556				2,022,263
Amortization of acquired contract liabilities			40,800				33,193
Total revenue			1,549,356				2,055,456
		$	2,900,117			$	3,364,930

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Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Contract Assets and Liabilities

Contract assets primarily represent revenues recognized for performance obligations that have been satisfied or partially satisfied but for which amounts have not been billed. This typically occurs when revenue is recognized over time but the Company's contractual right to bill the customer and receive payment is conditional upon the satisfaction of additional performance obligations in the contract, such as final delivery of the product. Contract assets are recognized when the revenue associated with the contract is recognized prior to billing and derecognized when billed in accordance with the terms of the contract. The Company performs ongoing evaluations of the potential impairment of its contract assets based on prior experience and specific matters when they arise. No impairments to contract assets were recorded for the years ended March 31, 2020 or 2019.

Contract liabilities are recorded when customers remit contractual cash payments in advance of the Company satisfying performance obligations under contractual arrangements, including those with performance obligations to be satisfied over a period of time. Contract liabilities other than those pertaining to forward loss reserves are derecognized when or as revenue is recognized.

Contract modifications can also impact contract asset and liability balances. When contracts are modified to account for changes in contract specifications and requirements, the Company considers whether the modification either creates new or changes the existing enforceable rights and obligations. Contract modifications that are for goods or services that are not distinct from the existing contract, due to the significant integration with the original good or service provided, are accounted for as if they were part of that existing contract. The effect of a contract modification to an existing contract on the transaction price and our measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis. When the modifications include additional performance obligations that are distinct and at relative stand-alone selling price, they are accounted for as a new contract and performance obligation, which are recognized prospectively.

Contract balances are classified as assets or liabilities on a contract-by-contract basis at the end of each reporting period. The following table summarizes our contract assets and liabilities balances:

		March 31, 2020				March 31, 2019				Change
Contract assets		$	267,079			$	326,667			$	(59,588	)
Contract liabilities			(386,585	)			(450,051	)			63,466
Net contract liability		$	(119,506	)		$	(123,384	)		$	3,878

The Company recognized revenue due to changes in estimates associated with performance obligations satisfied or partially satisfied in previous periods of $12,011. The decrease in contract assets is the result of $76,667 and $39,753 in contract assets liquidated as part of the assignment of the E2-Jets contract to ASTK and the sale of the Nashville manufacturing operations, respectively, partially offset by revenue recognized in excess of amounts billed during the year ended March 31, 2020. The decrease in contract liabilities is the result of revenue recognized in excess of the receipt of additional customer advances during the period as well as $12,641 in contract liabilities liquidated as part of the assignment of the E2-Jets contract to ASTK. For the period ended March 31, 2020, the Company recognized $89,012 of revenue that was included in the contract liability balance at the beginning of the period. Noncurrent contract assets presented in other, net on the accompanying consolidated balance sheets as of March 31, 2020 and 2019, were $22,662 and $34,185, respectively. Noncurrent contract liabilities presented in other noncurrent liabilities on the accompanying consolidated balance sheets as of March 31, 2020 and 2019, were $91,265 and $156,332, respectively.

Performance Obligations

Customers generally contract with the Company for requirements in a segment relating to a specific program, and the Company’s performance obligations consist of a wide range of engineering design services and manufactured components, as well as spare parts and repairs for OEMs. A single contract may contain multiple performance obligations consisting of both recurring and nonrecurring elements.

As of March 31, 2020, the Company has the following unsatisfied, or partially unsatisfied, performance obligations that are expected to be recognized in the future as noted in the table below. The Company expects options to be exercised in addition to the amounts presented below.

		Total				Less than 1 year				1-3 years				4-5 years				More than 5 years
Unsatisfied performance obligations		$	3,875,679			$	1,956,289			$	1,104,754			$	441,808			$	372,828

5.    INVENTORIES

The Company records inventories at the lower of cost (average-cost or specific-identification methods) or market. The componentsCompany expenses general and administrative costs related to products and services provided essentially under commercial terms and conditions as incurred. The Company determines the costs of inventories are as follows:

	March 31,
	2016				2015
Raw materials	$	81,989			$	73,168
Work-in-process	1,100,660				1,305,390
Finished goods	124,744				91,639
Less: unliquidated progress payments	(123,155		)		(189,923		)
Total inventories	$	1,184,238			$	1,280,274

Accordingsold by the first-in, first-out or average cost methods.

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Notes to the provisions of U.S. Government contracts, the customer has title to, or a security interest in, substantially all inventories related to such contracts. Included above is total net inventory on government contracts of $27,635 and $70,121, respectively, at March 31, 2016 and 2015.

Work-in-process inventory includes capitalized pre-production costs on newer development programs. Capitalized pre-production costs include nonrecurring engineering, planning and design, including applicable overhead, incurred before production is manufactured on a regular basis. Significant customer-directed work changes can also cause pre-production costs to be incurred. These costs are typically recovered over a contractually determined number of ship set deliveries. The balance of development program inventory, comprised principally of capitalized pre-production costs, excluding progress payments related to the Company's contracts with Bombardier for the Global 7000/8000 program ("Bombardier") and Embraer for the second generation E-Jet ("Embraer") are as follows:

	March 31, 2016
	Inventory				Forward Loss Provision				Total Inventory, net
Bombardier	$	412,809			$	(399,758	)		$	13,051
Embraer	151,904				—				151,904
Total	$	564,713			$	(399,758	)		$	164,955
	March 31, 2015
	Inventory				Forward Loss Provision				Total Inventory, net
Bombardier	$	266,739			$	—			$	266,739
Embraer	68,112				—				68,112
Total	$	334,851			$	—			$	334,851

In the fourth quarter of the fiscal year ended March 31, 2016, we recorded a $399,758 forward loss charge for the Bombardier Global 7000/8000 wing program. Under our contract for this program, we have the right to design, develop and manufacture wing components over the initial 300 ship sets . The Global 7000/8000 contract provides for fixed pricing and requires us to fund certain up-front development expenses, with certain milestone payments made by Bombardier. The Global 7000/8000 program charge resulted in the impairment of previously capitalized pre-production costs due to the combination of cost recovery uncertainty, higher than anticipated non-recurring costs and increased forecasted costs on recurring production. The increases in costs were driven by several factors, including: changing technical requirements, increased spending on the design and engineering phase of the program and uncertainty regarding cost reduction and cost recovery initiatives with our customer and suppliers. Further cost increases or an inability to meet revised recurring cost forecasts on the Global 7000/8000 program may result in additional forward loss reserves in future periods, while improvements in future costs compared to current estimates may result in favorable adjustments if forward loss reserves are no longer required.

The Company is still in the pre-production stages for the Bombardier and Embraer programs, as these aircrafts are not scheduled to enter service until 2018, or later. Transition of these programs from development to recurring production levels is

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Consolidated Financial Statements

(Dollars in thousands, except per share data)

The components of inventories are as follows:

		March 31,
		2020				2019
Raw materials		$	32,552			$	35,883
Work-in-process, including manufactured and purchased components			312,953				277,996
Finished goods			50,011				42,399
Rotable assets			57,460				57,282
Total inventories		$	452,976			$	413,560

dependent upon

6.    PROPERTY AND EQUIPMENT

Property and equipment, which include equipment under finance lease and leasehold improvements, are recorded at cost and depreciated over the successestimated useful lives of the programs at achieving flight testingrelated assets, or the lease term if shorter in the case of leasehold improvements, using the straight-line method. Buildings and certification, as well as the abilityimprovements are depreciated over a period of the Bombardier15 to 39.5 years, and Embraer programsmachinery and equipment are depreciated over a period of 7 to generate acceptable levels15 years (except for furniture, fixtures and computer equipment which are depreciated over a period of aircraft sales. The failure3 to achieve these milestones and level of sales or significant cost overruns may result in additional forward losses.

6.	PROPERTY AND EQUIPMENT

10 years).

Net property and equipment at March 31, 2016 and 2015, is:

		March 31,
		2020				2019
Land		$	42,438			$	52,333
Construction-in-process			19,231				25,310
Buildings and improvements			285,407				320,289
Machinery and equipment			701,018				814,040
			1,048,094				1,211,972
Less: accumulated depreciation			629,953				668,262
		$	418,141			$	543,710

	March 31,
	2016				2015
Land	$	72,204			$	72,893
Construction in process	40,772				53,475
Buildings and improvements	371,336				374,763
Furniture, fixtures and computer equipment	159,511				146,834
Machinery and equipment	989,423				947,149
	1,633,246				1,595,114
Less: accumulated depreciation	743,512				644,380
	$	889,734			$	950,734

Depreciation expense for the fiscal years ended March 31, 2016, 20152020, 2019, and 20142018, was $122,197, $108,347$89,857, $97,323 and $117,553,$101,873, respectively, which includes depreciation of assets under capitalfinance lease. Included in furniture, fixtures and computer equipment above is $93,047 and $84,098, respectively, of capitalized software at March 31, 2016 and 2015, which were offset by accumulated depreciation of $66,760 and $55,304, respectively.

7.	GOODWILL AND OTHER INTANGIBLE ASSETS

7.    GOODWILL AND OTHER INTANGIBLE ASSETS

The following is a summary of the changes in the carrying value of goodwill by reportable segment, for the fiscal years ended March 31, 20162020 and 2015:2019:

								Systems & Support
March 31, 2019								$	583,225
Effect of exchange rate changes									(3,577	)
Impairment of goodwill									(66,121	)
March 31, 2020								$	513,527

								Systems & Support
March 31, 2018								$	592,828
Goodwill associated with dispositions									(2,788	)
Effect of exchange rate changes									(6,815	)
March 31, 2019								$	583,225

	Aerostructures				Aerospace Systems				Aftermarket Services				Total
Balance, March 31, 2015	$	1,420,208			$	523,253			$	81,385			$	2,024,846
Goodwill recognized in connection with acquisitions	—				16,529				—				16,529
Impairment of goodwill	(597,603		)		—				—				(597,603		)
Effect of exchange rate changes	196				216				70				482
Balance, March 31, 2016	$	822,801			$	539,998			$	81,455			$	1,444,254

	Aerostructures				Aerospace Systems				Aftermarket Services				Total
Balance, March 31, 2014	$	1,339,993			$	395,912			$	55,986			$	1,791,891
Goodwill recognized in connection with acquisitions	79,345				150,772				25,291				255,408
Effect of exchange rate changes	870				(23,431		)		108				(22,453		)
Balance, March 31, 2015	$	1,420,208			$	523,253			$	81,385			$	2,024,846

Consistent with the Company's policy described here within, the Company performs Step 1

As of theMarch 31, 2020 and 2019, Aerospace Structures had gross goodwill of $1,166,773 and $1,246,454, respectively, which was fully impaired.  As of March 31, 2020 and 2019, Systems & Support had gross goodwill of $579,649 and $583,225, respectively, and accumulated goodwill impairment test on an interim basis upon the occurrence of events or substantive changes in circumstances that indicate a reporting unit's carrying value may be less than its fair value. During the third quarter of the fiscal year ended March 31, 2016, the Company performed an interim assessment of the fair value of its goodwill$66,121 and indefinite-lived intangible assets due$0, respectively.  

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Triumph Group, Inc.

Notes to indicators of impairment related to the continued decline in the Company's stock price during the third quarter. The Company performed Step 1 of the goodwill impairment test which included using a combination of both the market and income approaches to estimate the fair value of each reporting unit.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Consolidated Financial Statements

(Dollars in thousands, except per share data)

The Company's assessment focused on the Aerostructures reporting unit since it had significant changes in its economic indicators and adjusted for select changes in the risk adjusted discount rate to consider both the current return requirements of the market and the risks inherent in the reporting unit, expected long-term growth rate and cash flow projections to determine if any decline in the estimated fair value of a reporting unit could result in a goodwill impairment. The decline in fair value compared to carrying value of the goodwill is the result of declining revenues from production rate reductions and the slower than previously projected ramp in Bombardier Global 7000/8000 and the timing of associated earnings. The Company concluded that the goodwill was not impaired as of the interim impairment assessment date. However, the excess of the fair value over the carrying value was within 5% for the Aerostructures reporting unit. The amount of goodwill for the Aerostructures reporting unit amounted to $1,420,195 at December 31, 2015.

During the fourth quarter of the fiscal year ended March 31, 2016, consistent with the Company's policy described here within, the Company performed its annual assessment of the fair value of goodwill. The Company concluded that the goodwill related to the Aerostructures reporting unit was impaired as of the annual testing date. The Company concluded that the goodwill had an implied fair value of $822,801 (Level 3) compared to a carrying value of $1,420,195. Accordingly, the Company recorded a non-cash impairment charge during the fourth quarter of the fiscal year ending March 31, 2016, of $597,603, which is presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets". The decline in fair value is the result of continued declines in stock price and related market multiples for stock price to EBITDA of both the Company and our peer group. Going forward, the Company will continue to monitor the performance of this reporting unit in relation to the key assumptions in our analysis.

In the event that market multiples for stock price to EBITDA in the aerospace and defense markets decrease, or the expected EBITDA and cash flows for the Company's reporting units decreases, an additional goodwill impairment charge may be required, which would adversely affect the Company's operating results and financial condition. If management determines that impairment exists, the impairment will be recognized in the period in which it is identified.

Intangible Assets

The components of intangible assets, net are as follows:

		March 31, 2020
		Weighted- Average Life (in Years)				Gross Carrying Amount				Accumulated Amortization				Net
Customer relationships			17.7			$	550,131			$	(276,980	)		$	273,151
Product rights, technology and licenses			11.4				54,676				(46,180	)			8,496
Noncompete agreements and other			16.7				2,656				(1,208	)			1,448
Tradenames			10.0				150,000				(51,127	)			98,873
Total intangibles, net						$	757,463			$	(375,495	)		$	381,968

		March 31, 2019
		Weighted- Average Life (in Years)				Gross Carrying Amount				Accumulated Amortization				Net
Customer relationships			17.7			$	551,093			$	(245,626	)		$	305,467
Product rights, technology and licenses			11.4				54,850				(43,978	)			10,872
Noncompete agreements and other			16.7				2,656				(1,041	)			1,615
Tradenames			10.0				150,000				(37,000	)			113,000
Total intangibles, net						$	758,599			$	(327,645	)		$	430,954

	March 31, 2016
	Weighted- Average Life (in Years)		Gross Carrying Amount				Accumulated Amortization				Net
Customer relationships	16.4		$	683,309			$	(215,546	)		$	467,763
Product rights, technology and licenses	11.7		55,739				(37,695		)		18,044
Noncompete agreements and other	16.1		2,881				(718		)		2,163
Tradenames	20.0		163,000				(1,358		)		161,642
Total intangibles, net			$	904,929			$	(255,317	)		$	649,612

	March 31, 2015
	Weighted- Average Life (in Years)		Gross Carrying Amount				Accumulated Amortization				Net
Customer relationships	16.5		$	683,272			$	(180,765	)		$	502,507
Product rights, technology and licenses	11.8		56,302				(33,208		)		23,094
Noncompete agreements and other	15.9		2,929				(565		)		2,364
Tradenames	Indefinite-lived		438,400				—				438,400
Total intangibles, net			$	1,180,903			$	(214,538	)		$	966,365

During the third quarter of the fiscal year ended March 31, 2016, the Company performed an interim assessment of fair value on our indefinite-lived intangible assets due to indicators of impairment related to the continued decline in our stock price during the fiscal third quarter. The Company estimated the fair value of the tradenames using the relief-from-royalty method, which uses several significant assumptions, including revenue projections that consider historical and estimated future results, general economic and market conditions, as well as the impact of planned business and operational strategies. The following estimates and assumptions were also used in the relief-from-royalty method:

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

•Royalty rates between 2% and 4% based on market observed royalty rates and profit split analysis; and

•Discount rates between 12% and 13% based on the required rate of return for the tradename assets.

Based on the Company's evaluation of indefinite-lived assets, including the tradenames, the Company concluded that the Vought tradename had a fair value of $195,800 (Level 3) compared to a carrying value of $425,000. Accordingly, the Company recorded a non-cash impairment charge during the third quarter of the fiscal year ended March 31, 2016, of $229,200, which is presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets". The decline in fair value compared to carrying value of the Vought tradename is the result of declining revenues from production rate reductions and the slower than previously projected ramp in Bombardier Global 7000/8000 and the timing of associated earnings.

During the fourth quarter of the fiscal year ended March 31, 2016, the Company performed its annual assessment of fair value on our indefinite-lived intangible assets. The Company estimated the fair value of the tradenames using the relief-from-royalty method, which uses several significant assumptions, including revenue projections that consider historical and estimated future results, general economic and market conditions, as well as the impact of planned business and operational strategies. The following estimates and assumptions were also used in the relief-from-royalty method:

•Royalty rates between 2% and 4% based on market observed royalty rates and profit split analysis; and

•Discount rate of 14% based on the required rate of return for the tradename assets,which increased from our interim assessment driven by increased risk due to continued declines in stock price and related market multiples for stock price to EBITDA of both the Company and our peer group and increased interest rates.

Based on the Company's evaluation of indefinite-lived assets, including the tradenames, the Company concluded that the Vought and Embee tradenames had a fair value of $163,000 (Level 3) compared to a carrying value of $209,200. Accordingly, the Company recorded a non-cash impairment charge during the fiscal year ended March 31, 2016 of $46,200, which is presented on the accompanying Consolidated Statements of Operations as "Impairment of intangible assets". The decline in fair value of the Vought and Embee tradenames is the result of declining revenues from production rate reductions and the slower than previously projected ramp in Bombardier Global 7000/8000 and the timing of associated earnings. Additionally, it was determined that the tradenames will be amortized over their remaining estimated useful life of 20 years.

In the event of significant loss of revenues and related earnings associated with the Vought and Embee tradenames, further impairment charges may be required, which would adversely affect our operating results.

Amortization expense for the fiscal years ended March 31, 2016, 20152020, 2019, and 2014,2018, was $54,620, $49,976$48,311, $52,581, and $46,724,$56,495, respectively. Amortization expense for the five fiscal years succeeding March 31, 2016,2020, by year is expected to be as follows: 2017: $55,386; 2018: $53,853; 2019: $52,278; 2020: $49,922; 2021: $49,9002021: $48,139; 2022: $47,898; 2023: $47,898; 2024: $47,898; 2025: $47,898, and thereafter: $388,273.

8.	ACCRUED EXPENSES

$142,237.

8.    ACCRUED EXPENSES

Accrued expenses are composedconsist of the following items:

		March 31,
		2020				2019
Accrued pension		$	753			$	742
Accrued other postretirement benefits			4,775				10,758
Accrued compensation and benefits			84,404				102,009
Accrued interest			13,252				12,374
Accrued warranties			30,079				18,977
Accrued workers' compensation			16,583				17,635
Accrued income tax			3,796				5,974
Operating lease liabilities			13,139				—
All other			60,622				71,103
Total accrued expenses		$	227,403			$	239,572

	March 31,
	2016				2015
Accrued pension	$	3,621			$	3,940
Deferred revenue, advances and progress billings	78,932				33,463
Accrued other postretirement benefits	16,246				20,116
Accrued compensation and benefits	114,149				114,777
Accrued interest	16,933				16,624
Warranty reserve	31,975				34,521
Accrued workers' compensation	17,033				16,500
Accrued income tax	2,469				2,516
Loss contract reserve	307,934				99,559
All other	93,916				68,860
Total accrued expenses	$	683,208			$	411,848

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9.    LEASES

The components of Contentslease expense for the year ended March 31, 2020, are disclosed in the table below.

Lease Cost		Financial Statement Classification		Year ended March 31, 2020
Operating lease cost		Cost of sales or Selling, general and administrative expense		$	24,539
Variable lease cost		Cost of sales or Selling, general and administrative expense			8,382
Financing Lease Cost:
Amortization of right-of-use assets		Depreciation and amortization			5,317
Interest on lease liability		Interest expense and other			2,307
Total lease cost (1)				$	40,545

TRIUMPH GROUP, INC.

(1)	Total lease cost does not include short-term leases or sublease income, both of which are immaterial.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Supplemental cash flow information for the year ended March 31, 2020, is disclosed in the table below.

		Year ended March 31, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows used in operating leases		$	21,430
Operating cash flows used in finance leases			2,327
Financing cash flows used in finance leases			8,370
ROU assets obtained in exchange for lease liabilities
Operating leases			3,826
Finance leases		$	1,039

Supplemental balance sheet information related to leases as of March 31, 2020, is disclosed in the table below.

Leases		Classification		March 31, 2020
Assets
Operating lease ROU assets		Other, net		$	61,461
Finance lease ROU assets, cost		Property and equipment, net			39,461
Accumulated amortization		Property and equipment, net			(18,650	)
Finance lease ROU assets, net					20,811
Total lease assets				$	82,272
Liabilities
Current
Operating		Accrued expenses		$	13,139
Finance		Current portion of long-term debt			7,336
Noncurrent
Operating		Other noncurrent liabilities			54,687
Finance		Long-term debt, less current portion			16,597
Total lease liabilities				$	91,759

Information related to lease terms and discount rates as of March 31, 2020, is disclosed in the table below.

		March 31, 2020
9. Weighted average remaining lease term (years)	LEASES
Operating leases			7.2
Finance leases			6.9
Weighted average discount rate
Operating leases			6.2	%
Finance leases			5.9	%

At

The maturity of the Company's lease liabilities as of March 31, 2016,2020, is disclosed in the table below.

		Operating leases				Finance leases				Total
FY2021		$	16,843			$	8,545			$	25,388
FY2022			14,523				5,571				20,094
FY2023			11,072				2,707				13,779
FY2024			8,311				2,138				10,449
FY2025			7,042				1,308				8,350
Thereafter			27,192				9,954				37,146
Total lease payments			84,983				30,223				115,206
Less: Imputed interest			(17,157	)			(6,290	)			(23,447	)
Total lease liabilities		$	67,826			$	23,933			$	91,759

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

At March 31, 2019, future minimum payments under noncancelable operating leases with initial or remaining terms of more than one year were as follows: 2017—2020—$27,904; 2018—21,543; 2021—$24,541; 2019—18,516; 2022—$21,677; 2020—14,394; 2023—$17,931; 2021—11,037; 2024—$15,7128,409 and thereafter—$60,54034,828 through 2031.2031. In the normal course of business, operating leases are generally renewed or replaced by other leases.

Total rental expense was $33,279, $34,762 and $41,508 for the fiscal years ended March 31, 2016, 2015 and 2014, respectively.

10.	LONG-TERM DEBT

10.    LONG-TERM DEBT

Long-term debt consists of the following:

		March 31,
		2020				2019
Revolving credit facility		$	400,000			$	215,000
Receivable securitization facility			75,000				80,700
Finance leases			23,933				31,292
Senior secured notes due 2024			525,000				—
Senior notes due 2021			—				375,000
Senior notes due 2022			300,000				300,000
Senior notes due 2025			500,000				500,000
Less: debt issuance costs			(16,426	)			(13,171	)
			1,807,507				1,488,821
Less: current portion			7,336				8,201
		$	1,800,171			$	1,480,620

	March 31,
	2016				2015
Revolving credit facility	$	140,000			$	148,255
Term loan	337,500				356,250
Receivable securitization facility	191,300				100,000
Capital leases	74,513				91,913
Senior notes due 2021	375,000				375,000
Senior notes due 2022	300,000				300,000
Other debt	7,978				7,978
Less: Debt issuance costs	(8,971		)		(10,796		)
	1,417,320				1,368,600
Less: current portion	42,441				42,255
	$	1,374,879			$	1,326,345

Revolving Credit Facility

In May 2014,

On September 23, 2019, the Company and its subsidiary co-borrowers and guarantors entered into an Eleventh Amendment to the Credit Agreement (the “Eleventh Amendment” and the existing Credit Agreement as amended and restated its existing credit agreement (theby the Eleventh Amendment, the “Credit Facility”Agreement”) with its lenders to (i) increase the maximum amount allowed forAdministrative Agent and the receivable securitization facility (the "Securitization Facility") and (ii) amend certainLenders party thereto. Among other terms and covenants.things, the Eleventh Amendment:

(i)

permits the Company to incur indebtedness in respect of the Senior Secured Notes due 2024 (the "2024 Notes") in an aggregate principal amount of up to $525,000, subject to the terms and conditions of the Intercreditor Agreement;

In November 2013, the Company amended and restated its Credit Facility with its lenders to (i) provide for a $375,000 term loan with a maturity date of May 14, 2019 (the "2013 Term Loan"), (ii) maintain a Revolving Line of Credit under the Credit Facility of $1,000,000, with a $250,000 accordion feature, (iii) extend the maturity date to November 19, 2018, and (iv) amend certain other terms and covenants.

(ii)

lowers the aggregate amount of revolving credit commitments from $700,000 to $600,000 upon the earlier of (a) the completion by the Company of $100,000 in certain asset sales or divestitures or (b) March 31, 2020;

(iii)

extends, with respect to extending banks representing approximately $406,500 of $600,000 total commitments outstanding as of March 31, 2020, the expiration date for the revolving line of credit available to the Company pursuant to the Credit Agreement to March 15, 2024; and retains an accordion feature that permits the Company to request an increase to the revolving credit commitments by up to $200,000;

(iv)

adds an additional mandatory prepayment provision requiring that the Company prepay any outstanding revolving credit loans in an amount equal to (a) with respect to an Identified Asset Sale (as defined in the Credit Agreement) the greater of (x) $50,000 and (y) 100% of the net asset sale proceeds received in connection therewith, and (b) with respect to other Specified Asset Sales (as defined in the Credit Agreement), 100% of the net asset proceeds received from such other Specified Asset Sales; and

(v)

modifies certain financial covenants and other terms.

In connection with the amendmentEleventh Amendment to the Credit Facility,Agreement, the Company incurred approximately $2,795$6,944 of financing costs.  These costs, along with the $6,507$6,222 of unamortized financing costs priorsubsequent to the amendment,Tenth Amendment, are being amortized over the remaining term of the Credit Facility.

TheAgreement on a lender-by-lender basis.  As a result of the reduction in the capacity of the Credit Agreement, the Company will repay the outstanding principalwrote off a proportional amount of unamortized financing fees existing prior to the 2013 Term Loan in quarterly installments, on the first business dayEleventh Amendment.  As of each January, April, July and October, commencing April 2014.

March 31, 2020, revolving credit commitments are $600,000.  

The obligationobligations under the Credit FacilityAgreement and related documents are secured by liens on substantially all assets of the Company and its domestic subsidiaries pursuant to ana Second Amended and Restated Guarantee and Collateral Agreement, dated as of November 19, 2013, among the administrative agent, the Company and the subsidiaries of the Company party thereto.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Pursuant to the Credit Facility,Agreement, the Company can borrow, repay and re-borrow revolving credit loans, and cause to be issued letters of credit, in an aggregate principal amount not to exceed $1,000,000$600,000 outstanding at any time.time as such revolving credit commitments are or have been reduced as discussed above.  The Credit FacilityAgreement bears interest at either: (i) LIBORLondon Interbank Offered Rate ("LIBOR") plus between 1.38%1.50% and 2.50%3.50%; (ii) the prime rate; or (iii) an overnight rate at the option of the Company.  The applicable interest rate is based upon the Company’s ratio of total indebtedness to earnings before interest, taxes, depreciation and amortization.amortization provided, however, that during the Pricing Restriction Period (as defined in the Credit Agreement), the loans will bear interest at the highest rate above LIBOR.  In addition, the Company is required to pay a commitment fee of between 0.25% and 0.45%0.50% on the unused portion of the Credit Facility.Agreement.  The Company’s obligations under the Credit FacilityAgreement are guaranteed by the Company’s domestic subsidiaries.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

At March 31, 2016,2020, there were $140,000$400,000 in outstanding borrowings and $25,709$22,338 in letters of credit outstanding under the Revolving Line of Credit Facilityprovisions of the Credit Agreement, primarily to support insurance policies. We have since repaid approximately $200,000 of the borrowings.  At March 31, 2015,2019, there were $148,255$215,000 in outstanding borrowings and $35,384$30,773 in letters of credit outstanding.outstanding under the Revolving Line of Credit provisions of the Credit Agreement, primarily to support insurance policies.  The level of unused borrowing capacity under the Revolving Line of Credit Facilityprovisions of the Credit Agreement varies from time to time depending in part upon the Company'sits compliance with financial and other covenants set forth in the related agreement.  The Credit FacilityAgreement contains certain affirmative and negative covenants, including limitations on specified levels of indebtedness to earnings before interest, taxes, depreciation and amortization, and interest coverage requirements, and includes limitations on, among other things, liens, mergers, consolidations, sales of assets, payment of dividends and incurrence of debt. If an event of default were to occur under the Credit Facility,Agreement, the lenders would be entitled to declare all amounts borrowed under it immediately due and payable. The occurrence of an event of default under the Credit FacilityAgreement could also cause the acceleration of obligations under certain other agreements. The Company is currently in compliance with all such covenants ascovenants.  As of March 31, 2016. As of March 31, 2016,2020, the Company had borrowing capacity under the Credit Facilitythis agreement of $834,291$70,271 after reductions for borrowings, and letters of credit outstanding under the Credit Facility.

In connection withfacility and consideration of covenant limitations.

On May 22, 2020, the Company amending and restating the Credit Facility to add the 2013 Term Loan, the Company alsoits subsidiary co-borrowers and guarantors entered into an interest rate swap agreement through November 2018 to reduce its exposure to interest on the variable rate portion of its long-term debt. On the date of inception, the Company designated the interest rate swap as a cash flow hedge in accordance with FASB guidance on accounting for derivatives and hedges and linked the interest rate swap to the 2013 Term Loan. The Company formally documented the hedging relationship between 2013 Term Loan and the interest rate swap, as well as its risk-management objective and strategy for undertaking the hedge, the nature of the risk being hedged, how the hedging instrument's effectiveness will be assessed and a description of the method of measuring the ineffectiveness. The Company also formally assesses, both at the hedge's inception and on a quarterly basis, whether the derivative item is highly effective offsetting changes in cash flows.

As of March 31, 2016 and 2015, the interest rate swap agreement had a notional amount of $337,500 and $356,250, respectively, and a fair value of $4,526 and $2,743, respectively, which is recorded in other comprehensive income net of applicable taxes (Level 2). The interest rate swap settles on a monthly basis when interest payments are made. These settlements occur through the maturity date.

In May 2016, the Company entered into a SixthTwelfth Amendment to the Third Amended and Restated Credit Agreement among the Company, the Subsidiary Co-Borrowers, the lenders party thereto and the Administrative Agent (the “Sixth“Twelfth Amendment” and the existing Credit Facility,Agreement as amended by the SixthTwelfth Amendment, the “Credit Facility”“Amended Credit Agreement”), pursuant to which those lenders electing to enter into with the Sixth Amendment extended the expiration date for the revolving line of creditAdministrative Agent and the maturity date for the term loan by five years to May 3, 2021. Lenders holding revolving credit commitments aggregating $940,000 elected to extend the expiration date for the revolving line of credit, and Lenders holding approximately $324,500 of term loans (out of an aggregate outstanding term loan balance of approximately $330,000) elected to extend the term loan maturity date.

In addition, the Sixth Amendment amended the Credit Facility to, amongparty thereto. Among other things, the Twelfth Amendment (i) modifylimits the amount of cash in the United States the Company can hold on its balance sheet to $50,000, (ii) authorizes the sale of any Specified TAS Business Unit (as defined in the Amended Credit Agreement); (iii) provides for a reserve against the availability of up to 75% of the proceeds of Specified Asset Sales (as defined in the Amended Credit Agreement); and (iv) modifies certain financial covenants to allow forand other terms over the add-back of certain cash and non-cash charges, (ii) amend the total leverage ratio financial covenant to provide for a gradual reduction in the maximum permitted total leverage ratio commencing with the fiscal yearquarterly periods ending June 2020 through March 31, 2018, (iii) increase the interest rate, commitment fee and letter of credit fee pricing provisions for the highest pricing tier, (iv) establish the interest rate, commitment fee and letter of credit fee pricing at the highest pricing tier until the Company delivers its compliance certificate for its fiscal year ending March 31, 2017, (v) increase the minimum revolver availability threshold test in connection with the Company making certain permitted investments, certain additional permitted dividends, permitted acquisitions and permitted payments of certain types of indebtedness, and (vi) decrease the maximum senior secured leverage ratio threshold test in connection with the Company making certain permitted investments, certain permitted dividends, permitted acquisitions and permitted payments of certain types of indebtedness during the period from the date of the Sixth Amendment until the Company delivers its compliance certificate for the fiscal year ending March 31, 2017.

2022.

Receivables Securitization Program

In November 2014,December 2019, the Company amended its receivable securitization facility (the "Securitization Facility"), increasing decreasing the purchase limit from $175,000$125,000 to $225,000$75,000 and extending the term through November 2017.December 2022.  In connection with the Securitization Facility, the Company sells on a revolving basis certain eligible accounts receivable to Triumph Receivables, LLC, a wholly ownedwholly-owned special-purpose entity, which in turn sells a percentage ownership interest in the receivables to commercial paper conduits sponsored by financial institutions.  The Company is the servicer of the trade accounts receivable under the Securitization Facility.  As of March 31, 2016,2020, the maximum amount available under the Securitization Facility was $225,000.$75,000.  Interest rates are based on prevailing market rates for short-term commercial paperLIBOR plus a program fee and a commitment fee.   The program fee is 0.40%0.13% on the amount outstanding under the Securitization Facility.  Additionally, the commitment fee is 0.40%0.50% on 100%100.00% of the maximum amount available under the Securitization Facility. At March 31, 2016,

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

$191,300 was outstanding under the Securitization Facility. In connection with amending the Securitization Facility, the Company incurred approximately $252 of financing costs. These costs, along with the $341 of unamortized financing costs prior to the amendment, are being amortized over the life of the Securitization Facility. The Company securitizessecures its trade accounts receivable, which are generally non-interest bearing,non-interest-bearing, in transactions that are accounted for as borrowings pursuant to the ASC 860, Transfers and Servicing topic of the ASC.

.

The agreement governing the Securitization Facility contains restrictions and covenants, which includeincluding limitations on the making of certain restricted payments,payments; creation of certain liens,liens; and certain corporate acts such as mergers, consolidations and the sale of all or substantially all assets. The Company was in compliance with all such covenants as of March 31, 2016.

Capital Leases

During the fiscal years ended March 31, 2016, 2015 and 2014, the Company entered into new capital leases in the amounts of $188, $52 and $36, respectively, to finance a portion of the Company's capital additions for the respective years. During the fiscal years ended March 31, 2016, 2015 and 2014, the Company obtained financing for existing fixed assets in the amount of $6,497, $37,608 and $30,503, respectively.

assets.

Senior Secured Notes due 2021

Due 2024

On February 26, 2013,September 23, 2019, the Company issued $375,000$525,000 principal amount of 4.875%6.250% Senior Secured Notes due 2021 (the "2021 Notes").September 15, 2024. The 20212024 Notes were sold at 100% of principal amount and have an effective interest yield of 4.875%6.250%. Interest on the 2021 Notes accrues at the rate of 4.875% per annum and is payable semiannually in cash in arrears on April 1March 15 and October 1September 15 of each year, commencing on October 1, 2013.March 15, 2020. In connection with the issuance of the 20212024 Notes, the Company incurred approximately $6,327$9,300 of costs, which were deferred and are being amortized on the effective interest method over the term of the 20212024 Notes.

The 20212024 Notes are second lien secured obligations of the Company's senior unsecured obligationsCompany and rank equallyits subsidiary guarantors. The 2024 Notes:

(i)

rank equal in right of payment to existing and future senior indebtedness of the Company and its subsidiary guarantors, including the obligations of the Company and its subsidiary guarantors under the Company’s credit facility;

(ii)

are effectively subordinated to all obligations of the Company and its subsidiary guarantors that are either (A) secured by a lien on the Collateral (as defined below) that is senior or prior to the second-priority liens securing the 2024 Notes, including

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in right of payment with all of its other existing and future senior unsecured indebtedness and senior in right of payment to all of its existing and future subordinated indebtedness. thousands, except per share data)

the first-priority liens securing borrowings under the Company’s credit facility and certain cash management and hedging obligations, or (B) secured by assets that do not constitute the Collateral, in each case to the extent of the value of the assets securing such obligations;

(iii)

are senior in right of payment to existing and future subordinated indebtedness of the Company and its subsidiary guarantors;

(iv)

are effectively senior to all existing and future unsecured debt of the Company and its subsidiary guarantors, but only to the extent of the value of the Collateral (after giving effect to any senior liens on the Collateral); and

(v)

are structurally subordinated in right of payment to all indebtedness and other liabilities of the Company’s existing and future subsidiaries that do not guarantee the 2024 Notes.

The 20212024 Notes are guaranteed on a full, senior secured, joint and several basis by each of the Guarantor Subsidiaries.

Company’s domestic restricted subsidiaries that is a borrower under the Company’s credit facility or that guarantees any of the Company’s debt or that of any of the Company’s domestic restricted subsidiaries under the Company’s credit facility and in the future by any of the Company’s domestic restricted subsidiaries that are borrowers under any credit facility or that guarantee any debt of the Company or any of its domestic restricted subsidiaries incurred under any credit facility (the "Guarantor Subsidiaries").

The Company may redeem somethe 2024 Notes, in whole or all ofin part, at any time or from time to time on or after September 15, 2020, at specified redemption prices, plus accrued and unpaid interest, if any, to the 2021 Notesredemption date. At any time or from time to time prior to April 1, 2017, by paying a "make-whole" premium. TheSeptember 15, 2020, the Company may redeem somethe 2024 Notes, in whole or allin part, at a redemption price equal to 100% of their principal amount plus a make whole premium, together with accrued and unpaid interest, if any, to the 2021 Notes on or after April 1, 2017, at specified redemption prices.date. In addition, prior to April 1, 2016, the Company may redeem up to 35%40% of the 2021aggregate principal amount of the outstanding 2024 Notes prior to September 15, 2020, with the net cash proceeds offrom certain equity offerings at a redemption price equal to 104.875%106.250% of the aggregatetheir principal amount, plustogether with accrued and unpaid interest, if any, subject to certain limitations set forth in the indenture governingredemption date.

If the 2021 Notes (the "2021 Indenture").

TheCompany experiences specific kinds of changes of control, the Company is obligatedrequired to offer to repurchasepurchase all of the 20212024 Notes at a purchase price of (i) 101% of their principal amount, plus accrued and unpaid interest, if any, to the date of purchase.

The 2024 Notes were issued pursuant to an indenture dated as a result of certain change of control events and (ii) 100% of their principal amount plus accrued and unpaid interest, if any, in the event of certain asset sales. These restrictions and prohibitions are subject to certain qualifications and exceptions.

September 23, 2019 (the “Indenture”). The 2021 Indenture contains covenants that, among other things, limit the Company's ability and the ability of any of the Guarantor Subsidiaries toCompany and its restricted subsidiaries to: (i) grant liens on its assets,incur additional indebtedness; (ii) pay dividends or make dividend payments, other distributions ordistributions; (iii) make other restricted payments (iii)and investments; (iv) create liens; (v) incur restrictions on the ability of the Guarantor Subsidiariesrestricted subsidiaries to pay dividends or make certain other payments, (iv) enter into sale and leaseback transactions, (v) merge, consolidate, transfer or dispose of substantially all of their assets,payments; (vi) incur additional indebtedness, (vii) use the proceeds from sales ofsell assets, including capital stock of restricted subsidiaries,subsidiaries; (vii) enter into sale and leaseback transactions; (viii) merge or consolidate with other entities; and (ix) enter into transactions with affiliates.

Subsequent to year end, to ensure that

Senior Notes due 2021

On September 23, 2019, the Company had full accesscalled all outstanding 4.875% Senior Notes due 2021 (the "2021 Notes") and discharged the 2021 Notes by irrevocably depositing with the 2021 Notes trustee sufficient funds to our Revolving Credit Facility (the "Credit Facility") during fiscal 2017,pay all principal and accrued interest through October 23, 2019.  On October 23, 2019, the Company obtained approval from the holdersredeemed $375,000 principal amount of the 2021 Notes to amendwith the termsproceeds of the indenture to conform with the 2022 Notes (as defined below) which allows for a higher level of secured debt. Absent this consent, the Company would have been restricted as to the level of new borrowings under the Credit Facility during fiscal 2017.

Further, to mitigate the risk of failing to obtain the consent and to ensure the Company had adequate liquidity through fiscal 2017, the Company chose to make a significant draw on the Credit Facility in early April 2016, taking the outstanding balance to approximately $800,000. The Company paid down substantially all of the draw to the Credit Facility upon receiving consent from the holders of the 2021 Notes in May 2016.

2024 Notes.

Senior Notes Duedue 2022

On June 3, 2014, the Company issued $300,000 principal amount of 5.250%5.25% Senior Notes due June 1, 2022 (the "2022 Notes"). The 2022 Notes were sold at 100% of principal amount and have an effective interest yield of 5.250%5.25%. Interest on the 2022

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

Notes accrues at the rate of 5.250% per annum and is payable semiannually in cash in arrears on June 1 and December 1 of each year, commencing on December 1, 2014. In connection with the issuance of the 2022 Notes, the Company incurred approximately $4,990 of costs, which were deferred and are being amortized on the effective interest method over the term of the 2022 Notes.

The 2022 Notes are the Company's senior unsecured obligations and rank equally in right of payment with all of its other existing and future senior unsecured indebtedness and senior in right of payment to all of its existing and future subordinated indebtedness. The 2022 Notes are guaranteed on a full, joint and several basis by each of the Guarantor Subsidiaries.

The Company may redeem some or all of the 2022 Notes prior to June 1, 2017, by paying a "make-whole" premium. The Company may redeem some or all of the 2022 Notes on or after June 1, 2017, at specified redemption prices. In addition, prior to June 1, 2017, the Company may redeem up to 35% of the 2022 Notes with the net proceeds of certain equity offerings at a redemption price equal to 105.250% of the aggregate principal amount plus accrued and unpaid interest, if any, subject to certain limitations set forth in the indenture governing the 2022 Notes (the "2022 Indenture").

The Company is obligated to offer to repurchase the 2022 Notes at a price of (i)  101% of their principal amount plus accrued and unpaid interest, if any, as a result of certain change-of-control events and (ii)  100% of their principal amount plus accrued and unpaid interest, if any, in the event of certain asset sales. These restrictions and prohibitions are subject to certain qualifications and exceptions.

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Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The 2022 Indenture contains covenants that, among other things, limit the Company's ability and the ability of any of the Guarantor Subsidiaries to (i) grant liens on its assets, (ii) make dividend payments, other distributions or other restricted payments, (iii) incur restrictions on the ability of the Guarantor Subsidiaries to pay dividends or make other payments, (iv) enter into sale and leaseback transactions, (v) merge, consolidate, transfer or dispose of substantially all of their assets, (vi) incur additional indebtedness, (vii) use the proceeds from sales of assets, including capital stock of restricted subsidiaries, and (viii) enter into transactions with affiliates.

Receivables Purchase Agreement

On March 28, 2016, the Company entered into a Purchase Agreement ("Receivables Purchase Agreement") to sell certain accounts receivables to a financial institution without recourse. The Company is the servicer of the accounts receivable under the Receivables Purchase Agreement. As of March 31, 2016, the maximum amount available under the Receivables Purchase Agreement was $90,000. Interest rates are based on LIBOR plus 0.65% - 0.70%. As of March 31, 2016, the Company sold $89,900 worth of eligible accounts receivable.

Senior Subordinated Notes Due 2017

2025

On November 16, 2009,August 17, 2017, the Company issued $175,000$500,000 principal amount of 8.00%7.75% Senior Subordinated Notes due 2017August 15, 2025 (the "2017"2025 Notes"). The 20172025 Notes were sold at 98.56%100% of principal amount and hadhave an effective interest yield of 8.25%7.75%. Interest on the 2017 Notes wasis payable semiannually in cash in arrears on MayFebruary 15 and NovemberAugust 15 of each year.year, commencing on February 15, 2018. In connection with the issuance of the 20172025 Notes, the Company incurred approximately $4,390$8,779 of costs, which were deferred and are being amortized on the effective interest method over the term of the 20172025 Notes.

On November

The 2025 Notes are the Company's senior unsecured obligations and rank equally in right of payment with all of its other existing and future senior unsecured indebtedness and senior in right of payment to all of its existing and future subordinated indebtedness. The 2025 Notes are guaranteed on a full, joint and several basis by each of the Guarantor Subsidiaries.

The Company may redeem some or all of the 2025 Notes prior to August 15, 2013,2020, by paying a "make-whole" premium. The Company may redeem some or all of the 2025 Notes on or after August 15, 2020, at specified redemption prices. In addition, prior to August 15, 2020, the Company completed the redemptionmay redeem up to 35% of the 2017 Notes. The2025 Notes with the net proceeds of certain equity offerings at a redemption price equal to 107.75% of the aggregate principal amount of $175,000 was redeemed at a price of 104% plus accrued and unpaid interest. As a result of the redemption, the Company recognized a pre-tax loss on redemption of $11,069, consisting of early termination premium, unamortized discount and deferred financing fees and is presented on the accompanying Consolidated Statements of Operations as a component of "Interest expense and other" for the year ended March 31, 2014.

Senior Notes due 2018

On June 16, 2010, in connection with the acquisition of Vought, the Company issued $350,000 principal amount of 8.63% Senior Notes due 2018 (the "2018 Notes"). The 2018 Notes were sold at 99.27% of principal amount and had effective interest yield of 8.75%. Interest on the 2018 Notes accrued at the rate of 8.63% per annum and was payable semiannually in cash in arrears on January 15 and July 15 of each year, commencing on January 15, 2011. In connection with the issuance of the 2018 Notes, the Company incurred approximately $7,307 of costs, which were deferred and amortized on the effective interest method over the term of the 2018 Notes.

On June 23, 2014, the Company completed the redemption of the 2018 Notes. The principal amount of $350,000 was redeemed at a price of 104.79% plus accrued and unpaid interest. As a result of the redemption, the Company recognized a pre-tax loss on redemption of $22,615, consisting of early termination premium, write-off of unamortized discount and deferred

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

financing fees and was recorded on the Consolidated Statements of Operations as a component of "Interest expense and other" for the fiscal year ended March 31, 2015.

Convertible Senior Subordinated Notes

On May 22, 2014, the Company announced the redemption of the Convertible Notes. The redemption price for the Convertible Notes was equal to the sum of 100% of the principal amount of the Convertible Notes outstanding, plus accrued and unpaid interest, on the Convertible Notes upif any, subject to but not including, the redemption date of June 23, 2014. The Convertible Notes were able to be converted at the option of the holder.

The Convertible Notes were eligible for conversion upon meeting certain conditions as providedlimitations set forth in the indenture governing the Convertible Notes. For2025 Notes (the "2025 Indenture").

The Company is obligated to offer to repurchase the periods from January 1, 2011 through June 23, 2014,2025 Notes at a price of (i)  101% of their principal amount plus accrued and unpaid interest, if any, as a result of certain change-of-control events and (ii)  100% of their principal amount plus accrued and unpaid interest, if any, in the Convertible Notes were eligible for conversion. Duringevent of certain asset sales. These restrictions and prohibitions are subject to certain qualifications and exceptions.

The 2025 Indenture contains covenants that, among other things, limit the fiscal year ended March 31, 2015,Company's ability and the Company settled the conversionability of $12,834 in principal valueany of the Convertible Notes, withguarantor subsidiaries to (i) grant liens on its assets, (ii) make dividend payments, other distributions or other restricted payments, (iii) incur restrictions on the principal and the conversion benefit settled in cash. During the fiscal year ended March 31, 2014, the Company settled the conversion of $96,535 in principal valueability of the Convertible Notes, as requested byGuarantor Subsidiaries to pay dividends or make other payments, (iv) enter into sale and leaseback transactions, (v) merge, consolidate, transfer or dispose of substantially all of their assets, (vi) incur additional indebtedness, (vii) use the respective holders,proceeds from sales of assets, including capital stock of restricted subsidiaries, and (viii) enter into transactions with the principal settled in cash and the conversion benefit settled through the issuance of 2,290,755 shares.

To be included in the calculation of diluted earnings per share, the average price of the Company's common stock for the fiscal year must exceed the conversion price per share of $27.12. The average price of the Company's common stock for the fiscal years ended March 31, 2015 and 2014, was $65.11 and $73.94, respectively. Therefore, 40,177 and 811,083 additional shares, respectively, were included in the diluted earnings per share calculation for the fiscal years ended March 31, 2015 and 2014, respectively.

affiliates.

Financial Instruments Not Recorded at Fair Value

Carrying amounts and the related estimated fair values of the Company's long-term debt not recorded at fair value in the consolidated financial statements are as follows:

March 31, 2020								March 31, 2019
Carrying Value				Fair Value				Carrying Value				Fair Value
$	1,807,507			$	1,559,455			$	1,488,821			$	1,568,037

March 31, 2016								March 31, 2015
Carrying Value				Fair Value				Carrying Value				Fair Value
$	1,417,320			$	1,354,961			$	1,368,600			$	1,358,306

The fair value of the long-term debt was calculated based on either interest rates available for debt with terms and maturities similar to the Company's existing debt arrangements or broker quotes on our existing debt (Level 2 inputs).

Interest paid on indebtedness during the fiscal years ended March 31, 2016, 20152020, 2019, and 20142018, amounted to $62,325, $82,425$99,438, $99,981 and $81,100,$86,345, respectively. Interest capitalized during the fiscal years ended

As of March 31, 2016, 2015 and 2014 was $668, $284 and $4,246, respectively.

As of March 31, 2016,2020, the maturities of long-term debt are as follows: 20172021 —$42,441; 2018 $7,336; 2022 —$238,268; 2019 $4,659; 2023 —$191,891; 2020 $376,952; 2024 —$255,704; 2021 $401,486; 2025 —$17,705; $525,730; and thereafter—$680,282 $507,770 through 2021.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

11.	OTHER NONCURRENT LIABILITIES

11.    OTHER NONCURRENT LIABILITIES

Other noncurrent liabilities are composed of the following items:

		March 31,
		2020				2019
Acquired contract liabilities, net		$	92,962			$	184,612
Accrued warranties			31,036				39,418
Accrued workers' compensation			13,603				13,501
Noncurrent contract liabilities			91,265				156,332
Operating lease liabilities			54,687				—
Environmental contingencies			18,060				16,040
Income tax reserves			594				551
All other			3,962				14,095
Total other noncurrent liabilities		$	306,169			$	424,549

	March 31,
	2016				2015
Acquired contract liabilities, net	$	522,680			$	656,524
Deferred grant income	4,670				20,354
Accrued workers' compensation	15,942				15,657
Environmental contingencies	7,613				8,638
Accrued warranties	80,898				77,620
Income tax reserves	4,798				3,690
Legal contingencies	—				9,500
All other	25,678				19,495
Total other noncurrent liabilities	$	662,279			$	811,478

12.	INCOME TAXES

12.    INCOME TAXES

The components of pretax (loss)loss from continuing operations before income taxes are as follows:

		Year ended March 31,
		2020				2019				2018
Foreign		$	33,399			$	(18,336	)		$	(57,673	)
Domestic			(55,727	)			(308,857	)			(404,175	)
		$	(22,328	)		$	(327,193	)		$	(461,848	)

	Year ended March 31,
	2016				2015				2014
Foreign	$	(13,673	)		$	(429	)		$	3,482
Domestic	(1,145,474		)		349,723				308,751
	$	(1,159,147	)		$	349,294			$	312,233

The components of income tax (benefit) expense are as follows:

		Year ended March 31,
		2020				2019				2018
Current:
Federal		$	(654	)		$	(1,253	)		$	1,130
State			27				431				88
Foreign			3,602				3,335				5,433
			2,975				2,513				6,651
Deferred:
Federal			2,748				(9,076	)			(44,262	)
State			73				1,593				(14,672	)
Foreign			2				(456	)			15,826
			2,823				(7,939	)			(43,108	)
		$	5,798			$	(5,426	)		$	(36,457	)

	Year ended March 31,
	2016				2015				2014
Current:
Federal	$	2,074			$	391			$	672
State	615				178				1,346
Foreign	4,426				4,751				1,090
	7,115				5,320				3,108
Deferred:
Federal	(148,069		)		114,260				100,191
State	29,020				(1,857		)		3,102
Foreign	747				(7,126		)		(424		)
	(118,302		)		105,277				102,869
	$	(111,187	)		$	110,597			$	105,977

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

A reconciliation of the statutory federal income tax rate to the effective tax rate is as follows:

		Year ended March 31,
		2020				2019				2018
Statutory federal income tax rate			21.0	%			21.0	%			31.5	%
State and local income taxes, net of federal tax benefit			(12.1	)			4.6				3.2
Goodwill impairment			(37.4	)			—				(29.6	)
Disposition of business			—				3.2				(0.3	)
Miscellaneous permanent items and nondeductible accruals			3.9				(1.2	)			(0.2	)
Research and development tax credit			30.4				3.3				3.2
Foreign tax credits			(24.1	)			(0.7	)			1.2
Valuation allowance			27.9				(28.5	)			(3.4	)
Tax reform and CARES			(12.3	)			0.4				5.1
Global Intangible Low-Taxed Income			(20.4	)			(1.3	)			—
Other (including foreign rate differential and FIN 48)			(2.8	)			0.9				(2.8	)
Effective income tax rate			(26.0	)%			1.7	%			7.9	%

	Year ended March 31,
	2016			2015			2014
Statutory federal income tax rate	35.0	%		35.0	%		35.0	%
State and local income taxes, net of federal tax benefit	1.8			0.5			0.9
Goodwill impairment	(15.8	)		—			—
Miscellaneous permanent items and nondeductible accruals	(0.2	)		(0.7	)		0.5
Research and development tax credit	0.7			(1.9	)		(1.8	)
Foreign tax credits	0.2			(0.2	)		—
Valuation allowance	(13.4	)		—			—
Other	1.3			(1.0	)		(0.7	)
Effective income tax rate	9.6	%		31.7	%		33.9	%

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The components of deferred tax assets and liabilities are as follows:

		March 31,
		2020				2019
Deferred tax assets:
Net operating loss and other credit carryforwards		$	318,341			$	309,961
Inventory			17,521				17,849
Accruals and reserves			40,492				41,091
Interest carryforward			38,383				24,457
Pension and other postretirement benefits			152,048				126,337
Lease right-of-use assets			11,495				—
Prepaid expenses and other			241				—
Acquired contract liabilities, net			21,771				45,479
			600,292				565,174
Valuation allowance			(438,667	)			(399,013	)
Net deferred tax assets			161,625				166,161
Deferred tax liabilities:
Deferred revenue			38,458				27,159
Property and equipment			34,939				46,538
Goodwill and other intangible assets			80,740				93,272
Lease liabilities			14,928				—
Prepaid expenses and other			—				6,156
			169,065				173,125
Net deferred tax liabilities		$	7,440			$	6,964

	March 31,
	2016				2015
Deferred tax assets:
Net operating loss and other credit carryforwards	$	105,731			$	186,172
Inventory	139,006				4,171
Accruals and reserves	45,343				43,989
Pension and other postretirement benefits	252,234				186,806
Acquired contract liabilities, net	191,061				241,077
Other	—				—
	733,375				662,215
Valuation allowance	(157,246		)		(1,472		)
Net deferred tax assets	576,129				660,743
Deferred tax liabilities:
Deferred revenue	253,705				411,947
Property and equipment	140,781				144,641
Goodwill and other intangible assets	219,120				342,785
Prepaid expenses and other	6,754				4,812
	620,360				904,185
Net deferred tax liabilities	$	44,231			$	243,442

The Company follows ASC 740, Income Taxes, which prescribes a recognition threshold and measurement attribute criteria for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, as well as guidance on derecognition, classification, interest and penalties, disclosure and transition.

A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. When determining the amount of net deferred tax assets that are more likely than not to be realized, the Company assesses all available positive and negative evidence. This evidence includes, but is not limited to, prior earnings history, expected future earnings, carry-back and carry-forward periods and the feasibility of ongoing tax strategies that could potentially enhance the likelihood of the realization of a deferred tax asset. The weight given to the positive and negative evidence is commensurate with the extent the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses.

Based on these criteria and the relative weighting of both the positive and negative evidence available, and in particular the activity surrounding the Company's prior earnings history, including the forward losses and intangible impairments previously recognized, management determined that it was necessary to establish a valuation allowance against principally all of its net deferred tax assets at March 31, 2016.assets. Given the objectivityobjective verifiable negative evidence of a three-year cumulative loss and the weighting of all available positive evidence, the Company excluded projected taxable income (aside from reversing taxable

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

temporary differences) from the assessment of income that could be used as a source of taxable income to realize the deferred tax assets. Valuation allowances recorded

During fiscal year 2020, the Company adjusted the valuation allowance against the consolidated net deferred tax asset by $39,654 primarily due to an increase in fiscal 2016 were $155,774.

the net operating loss and changes to temporary differences related to the pension and other postretirement benefit plans. As of March 31, 2016,2020, management determined that it was necessary to maintain a valuation allowance against principally all of its net deferred tax assets.

As of March 31, 2020, the Company has federal and state net operating loss carryforwards of $589,548 expiring in various years through 2035. The Company also has a$658,146, $1,369,092, and $127,088 for U.S. federal, state, and foreign net operating loss carryforward of $109,532.

jurisdictions, respectively.

The effective income tax rate for the fiscal year ended March 31, 2016,2020, was 9.6%(26.0)% as compared to 31.7%with 1.7% for the fiscal year ended March 31, 2015.2019. The effective income tax rate for the fiscal year ended March 31, 2016,2020, included the benefit of $5,592 from a decrease to the state deferred tax rate, the benefit from the retroactive reinstatement of the R&D tax credit of $8,443$6,778, the benefit of the foreign tax rate differences of $5,375, and the change in the valuation allowance of $155,774. The$3,474 . Due to the current year pretax loss, the effective tax rate was also impacted by the non-deductible portiondrivers on a percentage basis are amplified. Accordingly, a year-over-year comparison of the goodwill impairmenteffective tax rate may not be indicative of $183,067.

changes in the Company's tax position.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The Company has been granted income tax holiday as an incentive to attract foreign investment by the Government of Thailand. The tax holidays expire in various years through 2026. We do not have any other tax holidays in the jurisdictions in which we operate. The income tax benefit attributable to the tax status of our subsidiaries in Thailand was approximately $(439)$1,932 or $(0.01)$0.04 per diluted share in fiscal 2016, $1,9302020, $2,160 or $0.04$0.04 per diluted share in fiscal 20152019 and $347$1,530 or $0.01$0.03 per diluted share in fiscal 2014.

2018.

At March 31, 2016,2020, cumulative undistributed earnings of foreign subsidiaries, for which no U.S. income or foreign withholding taxes have been recorded is $74,363.$150,780. As the Company currently intends to indefinitely reinvest all such earnings, no provision has been made for income taxes that may become payable upon distribution of such earnings, and it is not practicable to determine the amount of the related unrecognized deferred income tax liability.

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) which is aimed at providing emergency assistance and health care for individuals, families, and businesses affected by the COVID-19 pandemic and generally supporting the U.S. economy. The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss rules, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. Our income tax expense was increased by $2,747 due to certain provisions relating to net operating loss carryforward periods.  

The Company has classified uncertain tax positions as noncurrent income tax liabilities unless expected to be paid in one year. Penalties and tax-related interest expense are reported as a component of income tax expense.

As of March 31, 20162020 and 2015, the total amount of accrued income tax-related interest and penalties was $239 and $207, respectively.

During the fiscal years ended March 31, 2016, 2015 and 2014, the Company added $32, $4 and $32 of interest and penalties related to activity for identified uncertain tax positions, respectively.

As of March 31, 2016 and 2015,2019, the total amount of unrecognized tax benefits was $9,212$18,965 and $8,348,$19,152, respectively, all of which would impact the effective rate, if recognized. The Company anticipates that total unrecognized tax benefits may be reduced by $0 in the next 12 months.

With a few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for fiscal years ended before March 31, 2011, state or local examinations for fiscal years ended before March 31, 2012,2014, or foreign income tax examinations by tax authorities for fiscal years ended before March 31, 2010.

2013.

As of March 31, 2016,2020, the Company is not subject to examination in 1 state and no foreign jurisdictions.any income tax examinations. The Company has filed appeals in a prior state examination related to fiscal years ended March 31, 1999 through March 31, 2005. Because of net operating losses acquired as part of the acquisition of Vought, the Company is subject to U.S. federal income tax examinations and various state jurisdiction examinations for the years ended December 31, 2001, and after related to previously filed Vought tax returns. The Company believes appropriate provisions for all outstanding issues have been made for all jurisdictions and all open years.

A reconciliation of the liability for uncertain tax positions, which are included in noncurrent liabilitiesdeferred taxes for the fiscal years ended March 31, 20162020 and 20152019, follows:

		Year ended March 31,
		2020				2019				2018
Beginning balance		$	19,373			$	11,759			$	10,696
Adjustments for tax positions related to the current year			1,057				7,364				1,032
Adjustments for tax positions of prior years			(1,303	)			250				31
Ending balance		$	19,127			$	19,373			$	11,759

	Year ended March 31,
	2016				2015				2014
Beginning balance	$	8,826			$	9,293			$	7,710
Additions for tax positions related to the current year	669				962				774
Additions for tax positions of prior years	175				178				1,475
Reductions for tax positions of prior years	—				(1,607		)		(666		)
Ending Balance	$	9,670			$	8,826			$	9,293

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13. STOCKHOLDERS' DEFICIT

In March 2019, the Company adopted a tax benefits preservation plan (the "Plan") designed to preserve Triumph’s ability to utilize its net operating loss carryforwards and other tax attributes (collectively, "Tax Benefits"). The Plan is similar to plans adopted by other public companies with significant Tax Benefits. The Company obtained stockholder approval for the Plan as well as an amendment to the Company’s amended and restated certificate of Contents

TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

incorporation that permitted the issuance of Rights (as defined below) related to preferred stock, at its annual meeting of stockholders in 2019.  

Under the Plan, Triumph declared a dividend distribution of one right (a “Right”) for each share of its common stock outstanding at the close of business on March 25, 2019. The Rights trade with Triumph’s common shares and will expire on March 13, 2022. The Rights also will expire: (i) if the Rights are redeemed or exchanged as provided in the Plan; (ii) if the Board determines that the Plan is no longer necessary or desirable for the preservation of the Tax Benefits; or (iii) if the Board determines that no Tax Benefits, once realized, as applicable, may be carried forward (in which case, the Rights will expire on the first date of the relevant taxable year for which such determination is made).

Pursuant to the Plan, if a stockholder (or group) becomes a 5% stockholder without meeting certain customary exceptions, the Rights become exercisable and entitle stockholders (other than the 5% stockholder or group causing the rights to become exercisable) to purchase additional shares of Triumph at a significant discount, resulting in significant dilution in the economic interest and voting power of the 5% stockholder or group causing the Rights to become exercisable. Stockholders owning five percent or more of Triumph’s outstanding shares at the time the Plan was adopted were grandfathered and will only cause the Rights to distribute and become exercisable if they acquire an additional one percent or more of Triumph’s outstanding shares. Under the Plan, the Board has the ability to determine in its sole discretion that any person shall not be deemed an acquiring person and therefore that the Rights shall not become exercisable if such person becomes a 5% stockholder. The adoption of the Plan and the dividend distribution did not have an impact on our consolidated financial statements.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

13.	STOCKHOLDERS' EQUITY

In February 2014, the Company's Board of Directors authorized an increase in the Company's existing stock repurchase program by up to 5,000,000 shares of its common stock in addition to the 500,800 shares authorized under prior authorizations. During the fiscal years endedAs of March 31, 2015, the Company repurchased 2,923,011 of its common stock for $184,380. As a result, as of May 27, 2016,2020, the Company remains able to purchase an additional 2,277,789 shares. Repurchases may be made from time to time in open market transactions, block purchases, privately negotiated transactions or otherwise at prevailing prices. No time limit has been set for completion of the program.

During the fiscal year ended March 31, 2015, the Company settled the conversion of $12,834, in principal value of the Convertible Notes, as requested by the respective holders, with the principal and the conversion benefit settled in cash.

The holders of the common stock are entitled to one vote per share on all matters to be voted upon by the stockholders of Triumph.

The Company has preferred stock of $0.01 par value, 250,000 shares authorized. At March 31, 20162020 and 2015, zero2019, 0 shares of preferred stock were outstanding.

Accumulated Other Comprehensive Loss

Changes in accumulated other comprehensive loss ("AOCI") by component for the years ended March 31, 20162020 and 20152019, were as follows:

		Currency Translation Adjustment				Unrealized Gains and Losses on Derivative Instruments				Defined Benefit Pension Plans and Other Postretirement Benefits				Total (1)
March 31, 2018		$	(58,683	)		$	122			$	(309,309	)		$	(367,870	)
AOCI before reclassifications			(15,770	)			30				(126,679	)			(142,419	)
Amounts reclassified from AOCI	(3)		25,847				(1,282	)			(1,960	)	(2)		22,605
Net current period OCI			10,077				(1,252	)			(128,639	)			(119,814	)
March 31, 2019			(48,606	)			(1,130	)			(437,948	)			(487,684	)
AOCI before reclassifications			(13,439	)			(1,611	)			(210,142	)			(225,192	)
Amounts reclassified from AOCI			—				(1,562	)			(4,990	)	(2)		(6,552	)
Net current period OCI			(13,439	)			(3,173	)			(215,132	)			(231,744	)
March 31, 2020		$	(62,045	)		$	(4,303	)		$	(653,080	)		$	(719,428	)

		Currency Translation Adjustment			Unrealized Gains and Losses on Derivative Instruments			Defined Benefit Pension Plans and Other Postretirement Benefits					Total (1)
Balance March 31, 2014		$	198		$	1,496		$	(20,602	)			$	(18,908	)
OCI before reclassifications		(46,949		)	(4,098		)	(122,667		)			(173,714		)
Amounts reclassified from AOCI		—			(155		)	(6,133		)	(2)		(6,288		)
Net current period OCI		(46,949		)	(4,253		)	(128,800		)			(180,002		)
Balance March 31, 2015		(46,751		)	(2,757		)	(149,402		)			(198,910		)
OCI before reclassifications		(12,065		)	(527		)	(127,267		)			(139,859		)
Amounts reclassified from AOCI		—			364			(8,757		)	(2	)	(8,393		)
Net current period OCI		(12,065		)	(163		)	(136,024		)			(148,252		)
Balance March 31, 2016		$	(58,816	)	$	(2,920	)	$	(285,426	)			$	(347,162	)

(1) Net of tax.

(2) Includes amortization of actuarial losses and recognized prior service (credits) costs, which are included in the net periodic pension cost of which a portion is allocated to production as inventoried costs.

(1)
14.	EARNINGS PER SHARE Net of tax.

(2)	Includes amortization of actuarial losses and recognized prior service (credits) costs, which are included in the net periodic pension cost of which a portion is allocated to production as inventoried costs.

(3)	Includes amounts transferred from cumulative translation adjustments as a result of the sale of Triumph Gear Systems – Toronto.

14.    LOSS PER SHARE

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

		Year ended March 31,
		2020				2019				2018
		(thousands)
Weighted average common shares outstanding—basic			50,494				49,698				49,442
Net effect of dilutive stock options and non-vested stock(1)			—				—				—
Weighted average common shares outstanding—diluted			50,494				49,698				49,442

	Year ended March 31,
	2016			2015			2014
	(thousands)
Weighted-average common shares outstanding—basic	49,218			50,796			51,711
Net effect of dilutive stock options and nonvested stock	—			169			265
Net effect of convertible debt	—			40			811
Weighted-average common shares outstanding—diluted	49,218			51,005			52,787

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

(1)
15.	EMPLOYEE BENEFIT PLANS For the fiscal years ended March 31, 2020, 2019, and 2018, the shares that could potentially dilute earnings per share in the future but were not included in diluted weighted average common shares outstanding because to do so would have been anti-dilutive were immaterial.

15.    EMPLOYEE BENEFIT PLANS

Defined Contribution Pension Plan

The Company sponsors a defined contribution 401(k) plan, under which salaried and certain hourly employees may defer a portion of their compensation. Eligible participants may contribute to the plan up to the allowable amount as determined by the plan of their regular compensation before taxes. The Company generally matches contributions up to 50%75% of the first 6% of compensation contributed by the participant. All contributions and Company matches are invested at the direction of the employee in one or more investment options offered under the plan. Company matching contributions vest immediately and aggregated $17,462, $20,020to $14,763, $13,685, and $21,208$13,616 for the fiscal years ended March 31, 2016, 20152020, 2019, and 2014,2018, respectively.

  Effective April 1, 2020, the Company suspended its 401(k) match program for fiscal year 2021.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Defined Benefit Pension and Other Postretirement Benefit Plans

The Company sponsors several defined benefit pension plans covering some of its employees. Most employees are ineligible to participate in the plans or have ceased to accrue additional benefits under the plans. Benefits under the defined benefit plans are based on years of service and, for most non-represented employees, on average compensation for certain years. It is the Company's policy to fund at least the minimum amount required for all qualified plans, using actuarial cost methods and assumptions acceptable under applicable government regulations, by making payments into a trust separate from us.

In addition to the defined benefit pension plans, the Company provides certain health care and life insurance benefits for eligible retired employees. Such benefits are unfunded as of March 31, 2016.2020. Employees achieve eligibility to participate in these contributory plans upon retirement from active service if they meet specified age and years of service requirements. Election to participate for some employees must be made at the date of retirement. Qualifying dependents of eligible retirees at the date of retirement are also eligible for medical coverage. Current plan documents reserve the right to amend or terminate the plans at any time, subject to applicable collective bargaining requirements for represented employees.  From timeDuring the fiscal year, the Company reached agreement with two unions whose members make up the vast majority of participants eligible for retiree healthcare benefits.  Under the terms of these agreements, the right to time, changes have been made tobenefits under the benefitscurrent program ceased for all represented participants (actively employed and retired) by April 1, 2020.  Company-funded notional health reimbursement accounts were provided to various groupsretired participants (and their dependents) whose eligibility for current benefits ended under the new agreement. The average size of plan participants. Premiums paid byeach account is immaterialand the Company for most retirees for medical coverage prioranticipates that these accounts will be fully drawn down in two years.  These changes served to age 65 are capped and are based on years of service. Overall premiums are adjusted annually for changes inreduce the cost of the plans as determinedCompany’s other postretirement benefit (“OPEB”) liability by an independent actuary. In addition to this medical inflation cost-sharing feature, the plans also have provisions for deductibles, co-payments, coinsurance percentages, out-of-pocket limits, schedules of reasonable fees, preferred provider networks, coordination of benefits with other plans and a Medicare carve-out.

The Company also sponsors an unfunded supplemental executive retirement plan ("SERP") that provides retirement benefits to certain key employees.

approximately $99,000.  

In accordance with ASC 715, the Company has recognized the funded status of the benefit obligation as of March 31, 20162020 and 2015, in2019, on the accompanying Consolidated Balance Sheets.consolidated balance sheets. The funded status is measured as the difference between the fair value of the plans' assets and the PBO or accumulated postretirement benefit obligation of the plan. The majority of the plan assets are publicly traded investments which were valued based on the market price as of the measurement date. Investments that are not publicly traded were valued based on the estimated fair value of those investments based on our evaluation of data from fund managers and comparable market data.

The following table sets forth the Company's consolidated defined benefit pension plans for its union and non-union employees and its SERP as of March 31, 20162020 and 2015,2019, and the amounts recorded inon the Consolidated Balance Sheetsconsolidated balance sheets at March 31, 20162020 and 2015.2019. Company contributions include amounts contributed directly to plan assets and indirectly as benefits are paid from the Company's assets. Benefit payments reflect the total benefits paid from the plans and the Company's assets. Information on the plans includes both the domestic qualified and nonqualified plans and the foreign qualified plans.

		Pension Benefits								Other Postretirement Benefits
		Year ended March 31,								Year ended March 31,
		2020				2019				2020				2019
Change in projected benefit obligations
Projected benefit obligation at beginning of year		$	2,234,734			$	2,277,816			$	109,455			$	119,164
Service cost			2,336				3,292				62				227
Interest cost			68,446				79,446				1,559				4,039
Actuarial loss (gain)			138,652				48,931				3,472				(2,576	)
Plan amendments			4,898				1,138				(99,080	)			—
Curtailments			22,732				—				—				—
Divestitures			(55,354	)			—				—				—
Participant contributions			204				196				252				833
Settlements			(14,579	)			—				—				—
Special termination benefits			11,642				4,032				—				—
Benefits paid			(156,084	)			(176,398	)			(8,570	)			(12,232	)
Currency translation adjustment			(2,642	)			(3,719	)			—				—
Projected benefit obligation at end of year		$	2,254,985			$	2,234,734			$	7,150			$	109,455
Accumulated benefit obligation at end of year		$	2,252,126			$	2,229,188			$	7,150			$	109,455
Assumptions used to determine benefit    obligations at end of year
Discount rate		2.47 - 3.32%				2.54 - 3.88%					3.00	%			3.77	%
Rate of compensation increase		3.50 - 4.50%				3.50 - 4.50%				N/A				N/A

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

		Pension Benefits								Other Postretirement Benefits
		Year ended March 31,								Year ended March 31,
		2020				2019				2020				2019
Change in fair value of plan assets
Fair value of plan assets at beginning of year		$	1,796,111			$	1,903,901			$	—			$	—
Actual return on plan assets			(20,869	)			67,753				—				—
Settlements			(14,579	)			—				—				—
Participant contributions			204				196				252				833
Divestitures			(55,354	)			—				—				—
Company contributions			51,372				4,580				8,319				11,399
Benefits paid			(156,084	)			(176,398	)			(8,571	)			(12,232	)
Currency translation adjustment			(2,756	)			(3,921	)			—				—
Fair value of plan assets at end of year		$	1,598,045			$	1,796,111			$	—			$	—
Funded status (underfunded)
Funded status		$	(656,940	)		$	(438,623	)		$	(7,150	)		$	(109,455	)
Reconciliation of amounts recognized on the    consolidated balance sheets
Pension asset—noncurrent		$	1,503			$	3,900			$	—			$	—
Accrued benefit liability—current			(753	)			(742	)			(4,775	)			(10,758	)
Accrued benefit liability—noncurrent			(657,690	)			(441,781	)			(2,375	)			(98,697	)
Net amount recognized		$	(656,940	)		$	(438,623	)		$	(7,150	)		$	(109,455	)
Reconciliation of amounts recognized in    accumulated other comprehensive income
Prior service credits		$	5,595			$	780			$	(59,214	)		$	(14,497	)
Actuarial losses (gains)			926,893				682,226				(58,151	)			(67,985	)
Income tax (benefits) expenses related to above    items			(204,594	)			(204,594	)			42,016				42,016
Unamortized benefit plan costs (gains)		$	727,894			$	478,412			$	(75,349	)		$	(40,466	)

	Pension Benefits								Other Postretirement Benefits
	Year ended March 31,								Year ended March 31,
	2016				2015				2016				2015
Change in projected benefit obligations
Projected benefit obligation at beginning of year	$	2,479,319			$	2,160,708			$	239,267			$	311,012
Service cost	10,902				12,902				1,186				2,868
Interest cost	88,708				90,576				7,669				12,332
Actuarial loss (gain)	37,342				341,719				2,030				(61,261		)
Acquisitions	—				39,575				—				—
Plan amendments	7,395				50				(49,512		)		—
Participant contributions	212				145				2,323				3,339
Special termination benefits	724				—				—				—
Benefits paid	(192,652		)		(158,638		)		(23,062		)		(29,023		)
Currency translation adjustment	(1,635		)		(7,718		)		—				—
Projected benefit obligation at end of year	$	2,430,315			$	2,479,319			$	179,901			$	239,267
Accumulated benefit obligation at end of year	$	2,419,305			$	2,464,418			$	179,901			$	239,267
Assumptions used to determine benefit obligations at end of year
Discount rate	3.25 - 3.93%				3.78		%		3.73		%		3.66		%
Rate of compensation increase	3.50 - 4.50%				3.50		%		N/A				N/A

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

	Pension Benefits								Other Postretirement Benefits
	Year ended March 31,								Year ended March 31,
	2016				2015				2016				2015
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	2,156,148			$	1,933,269			$	—			$	—
Actual return on plan assets	(39,482		)		236,782				—				—
Settlements	—				—				—				—
Participant contributions	212				145				2,323				3,339
Company contributions	3,021				112,338				20,739				25,684
Acquisitions	—				39,651				—				—
Benefits paid	(192,652		)		(158,638		)		(23,062		)		(29,023		)
Currency translation adjustment	(1,562		)		(7,399		)		—				—
Fair value of plan assets at end of year	$	1,925,685			$	2,156,148			$	—			$	—
Funded status (underfunded)
Funded status	$	(504,630	)		$	(323,171	)		$	(179,901	)		$	(239,267	)
Reconciliation of amounts recognized in the consolidated balance sheets
Pension asset—noncurrent	$	—			$	—			$	—			$	—
Accrued benefit liability—current	(3,621		)		(3,940		)		(16,246		)		(20,116		)
Accrued benefit liability—noncurrent	(501,009		)		(319,231		)		(163,655		)		(219,151		)
Net amount recognized	$	(504,630	)		$	(323,171	)		$	(179,901	)		$	(239,267	)
Reconciliation of amounts recognized in accumulated other comprehensive income
Prior service credits	$	(6,755	)		$	(20,155	)		$	(47,384	)		$	(8,682	)
Actuarial losses (gains)	569,435				340,034				(66,480		)		(74,615		)
Income tax (benefits) expenses related to above items	(205,406		)		(118,445		)		42,016				31,265
Unamortized benefit plan costs (gains)	$	357,274			$	201,434			$	(71,848	)		$	(52,032	)

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

The components of net periodic benefit cost for fiscal years ended March 31, 2016, 20152020, 2019, and 20142018, are as follows:

		Pension Benefits												Other Postretirement Benefits
		Year Ended March 31,												Year Ended March 31,
		2020				2019				2018				2020				2019				2018
Components of net periodic pension    cost
Service cost		$	2,336			$	3,292			$	4,505			$	62			$	227			$	391
Interest cost			68,446				79,446				75,189				1,559				4,039				4,393
Expected return on plan assets			(141,329	)			(147,411	)			(152,346	)			—				—				—
Amortization of prior service credit cost			(874	)			(3,619	)			(2,841	)			(4,872	)			(4,655	)			(8,537	)
Amortization of net loss			27,199				16,822				13,905				(6,361	)			(9,851	)			(7,275	)
Curtailment loss (gain)			23,690				—				29				(49,491	)			—				(26,274	)
Settlements			28,452				—				523				—				—				—
Special termination benefits			11,642				4,032				—				—				—				—
Total net periodic benefit (income)    expense		$	19,562			$	(47,438	)		$	(61,036	)		$	(59,103	)		$	(10,240	)		$	(37,302	)
Assumptions used to determine net    periodic pension cost
Discount rate		2.54 - 3.88%				2.65 - 4.01%				2.87 - 4.06%				2.68 - 3.77%					3.93	%		3.62 - 3.93%
Expected long-term rate of return on plan assets		5.00 - 8.00%				5.00 - 8.00%				6.50 - 8.00%				N/A				N/A				N/A
Rate of compensation increase		3.50 - 4.50%				3.50 - 4.50%				3.50 - 4.50%				N/A				N/A				N/A

	Pension Benefits												Other Postretirement Benefits
	Year Ended March 31,												Year Ended March 31,
	2016				2015				2014				2016				2015				2014
Components of net periodic pension cost
Service cost	$	10,902			$	12,902			$	12,854			$	1,186			$	2,868			$	3,060
Interest cost	88,708				90,576				92,938				7,669				12,332				12,552
Expected return on plan assets	(162,285		)		(150,565		)		(147,545		)		—				—				—
Amortization of prior service credit cost	(4,038		)		(5,288		)		(6,731		)		(10,810		)		(4,529		)		(4,529		)
Amortization of net loss	9,488				—				13,487				(6,106		)		—				—
Curtailment gain	(1,968		)		—				(395		)		—				—				—
Settlements	—				—				1,561				—				—				—
Special termination benefits	724				—				—				—				—				—
Total net periodic benefit (income) expense	$	(58,469	)		$	(52,375	)		$	(33,831	)		$	(8,061	)		$	10,671			$	11,083
Assumptions used to determine net periodic pension cost
Discount rate	3.31 - 4.11%				4.32		%		4.07		%		3.66		%		4.14		%		3.79		%
Expected long-term rate on assets	6.50 - 8.25%				8.25		%		8.25		%		N/A				N/A				N/A
Rate of compensation increase	3.50 - 4.50%				3.50		%		3.50		%		N/A				N/A				N/A

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The discount rate is determined annually as of each measurement date, based on a review of yield rates associated with long-term, high-quality corporate bonds. At the end of each year, the discount rate is primarily determined using the results of bond yield curve models based on a portfolio of high-quality bonds matching notional cash inflows with the expected benefit payments for each significant benefit plan.

The expected return on plan assets is determined based on a market-related value of plan assets, which is a smoothed asset value.  The market-related value of assets is calculated by recognizing investment performance that is different from that expected on a straight-line basis over five years.  Actuarial gains and losses are amortized over the average remaining life expectancy of inactive participants for plans that are predominantly inactive and over the expected future service for active participants for other plans, but only to the extent unrecognized gains or losses exceed a corridor equal to 10% of the greater of the projected benefit obligation or market-related value of assets.

During the fourth quarter of the fiscal year ended March 31, 2016, the

The Company changed the method it uses to estimateestimates the service and interest componentscost of net periodic benefit cost for the Company’sits pension and other postretirement benefit plans.  This new estimation approach discounts the individual expected cash flows underlying the service cost and interest costOPEB plans by applyingusing the specific spot rates derived from the yield curve used to discount the cash flows reflected in the measurement of the benefit obligation.  Historically, the Company estimated these service and interest cost components utilizing a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period.

The Company madebelieves this change to provideapproach provides a more precise measurement of service and interest costs by improvingdue to the correlation between projected benefit cash flows to the corresponding spot yield curve rates. The Company has accounted for this change as a change in accounting estimate that is inseparable from a change in accounting principle pursuance to ASC 250, Accounting Changes and Error Corrections and accordingly have accounted for it prospectively.  While the benefit obligation measured under this approach is unchanged from that determined under the prior approach, the more granular application of the spot rates will reduce the service and interest cost for the pension and OPEB plans for the fiscal year ending March 31, 2017, by approximately $20,000. The spot rates used to determine service and interest costs the U.S. plans ranged from 0.60%to 9.75%. Under the Company’s prior methodology, these rates would have resulted in weighted-average rates for service cost and interest

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

cost of 3.86% for the U.S. Pension plans and 3.73% for the OPEB plans. The new approach will be used to measure the service cost and interest cost for our pension and OPEB plans for the fiscal year ending March 31, 2017.

Effective April 1, 2015, the Company changed the period over whichamortizes actuarial gains and losses are being amortized for its U.S. pension plans from the average remaining future service period of active plan participants toover the average life expectancy of inactive plan participants. This change was madeparticipants because the Company has determined that as of that date almost all plan participants are inactive.

During the fiscal year ended March 31, 2015,2020, the Society of Actuaries released new base mortality tables that reflect increased life expectancy for participants of U.S. pension plans.and an updated projection scale.  The Company has reflected these new tables, along with an updated projection scale of mortality improvements,releases in the measurement of our U.S. pension and other postretirement benefitOPEB plans as of March 31, 2015.2020. This change resulted in an increasea decrease in the benefit obligation.

The Company periodically experiences events or makes changes to its benefit plans that result in curtailment or special charges. Curtailments are recognized when events occur that significantly reduce the expected years of future service of present employees or eliminates the benefits for a significant number of employees for some or all of their future service.

Curtailment losses are recognized when it is probable the curtailment will occur and the effects are reasonably estimable. Curtailment gains are recognized when the related employees are terminated or a plan amendment is adopted, whichever is applicable.

As required under ASC 715, the Company remeasures plan assets and obligations during an interim period whenever a significant event occurs that results in a material change in the net periodic pension cost. The determination of significance is based on judgment and consideration of events and circumstances impacting the pension costs.

The following summarizes the key events whose effects on net periodic benefit cost and obligations are included in the tables above:

•

As disclosed in Note 3, in March 2020, the Company transferred approximately $55,354 of pension assets and liabilities to the buyer of its Nashville manufacturing operations.  The divestiture transaction and resulting transfer resulted in a settlement charge of approximately $28,452 and a curtailment charge of approximately $214.  These amounts are included in non-service defined benefit income on the consolidated statements of operations for the year ended March 31, 2020.

In March 2016, one of the Company's union-represented groups of employees ratified a new collective bargaining agreement. The agreement includes an amendment

•

In September 2019, the Company and the union which represents a portion of the workforce at the Company’s Grand Prairie, TX, facility, in conjunction with an announced shutdown of this facility, agreed to changes to the pension and retiree welfare plans for represented plan members. Effective April 1, 2020, all current retiree welfare benefits for the union-represented retirees and active employees will cease. A new benefit consisting of a one-time credit to Heath Reimbursement Accounts for the current retirees and their covered dependents will be provided. The Company and the union also agreed to increased pension benefits which are effective with the ratification of the agreement. This agreement resulted in a decrease of the projected other post-employment benefits ("OPEB") benefit obligation of $61,766. It also resulted in a one-time OPEB curtailment gain of $41,128. As a result of the planned shutdown, subsidized early retirement provisions within the retirement plan and the agreed-to pension benefit increases, a pension curtailment loss of $23,476 was recognized, along with a one-time charge of $11,642 for special termination benefits. The net curtailment gain and charge for special termination benefits are included in non-service defined benefit income on the consolidated statements of operations for the year ended March 31, 2020.

•

In August 2019, the Company and the union which represents a portion of the workforce at the Company’s Nashville, TN, facility agreed to changes to the pension and retiree welfare plans for represented plan members.  Effective January 1, 2020, all current retiree welfare benefits for the union-represented retirees and active employees will cease. A new benefit consisting of a one-time credit to Heath Reimbursement Accounts for the current retirees and their covered dependents will be provided. The Company and the union also agreed to increased pension benefits which are effective on February 1, 2020, and the union also agreed to increased pension benefits which are effective with the ratification of the agreement. This agreement resulted in a decrease of the projected OPEB benefit obligation of $34,731. It also resulted in a one-time OPEB curtailment gain of $8,363. The agreed-to pension benefit increases resulted in an increase of the projected pension benefit obligation of $4,898. The curtailment gain is included in non-service defined benefit income on the consolidated statements of operations for the year ended March 31, 2020.

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Notes to the other postretirement benefits plan, for which participants will no longer receive a benefit after the fiscal year ended March 31, 2016. This change resulted in the termination of the plan and as a result, the plan's liability was eliminated as of March 31, 2016 and the Company recognized a credit of approximately $2,297. Additionally, the agreement includes an amendment to the pension plan, under which participants will no longer continue to accrue a benefit after the fiscal year ending March 31, 2021. This change resulted in a curtailment gain of approximately $1,516 and is presented on the accompanying Consolidated Financial Statements of Operations within "Curtailments, settlements and early retirement incentives."

In February 2016, one of the Company's union-represented groups of employees ratified a new collective bargaining agreement. The agreement includes an amendment to the pension plan, under which effective January 1, 2017, actively accruing participants will no longer accrue benefits once they reach 30 years of service under the plan. This change resulted in a curtailment gain of approximately $3,314 and is presented on the accompanying Consolidated Statements of Operations within "Curtailments, settlements and early retirement incentives."

In May 2015 and February 2016 the Company offered enhanced retirement benefits to employees of one of its union-represented groups. In order to receive these enhanced benefits, eligible employees had to agree to retire within a special window period. This change resulted in a special termination charge of approximately $724 and is presented on the accompanying Consolidated Statements of Operations within "Curtailments, settlements and early retirement incentives."

In April 2015, the Company's largest union-represented group of employees ratified a new collective bargaining agreement. The agreement includes an amendment to the pension plan, under which participants will no longer accrue benefits after 30 years of service under the plan. This change resulted in a curtailment gain of approximately $2,863 and is presented on the accompanying Consolidated Statements of Operations within "Curtailments, settlements and early retirement incentives."

In March 2014, the Company announced an amendment to the retirement plan of its non-represented employee participants. Effective March 1, 2015, actively accruing participants with 30 years of service will no longer continue to accrue a benefit. Those changes resulted in a decrease in the projected pension obligation of $14,355 and a related

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

•

In February 2019, the Company transferred its Global 7500 wing manufacturing operations to Bombardier. In conjunction with this transaction, the Company provided special termination pension benefits to certain pension participants who transferred employment from Triumph to Bombardier. This change resulted in the recognition of a charge of $4,032 for special termination benefits. The special termination benefits charge is included in non-service defined benefit income on the consolidated statements of operations for the year ended March 31, 2019.

•

In March 2018, the Company ratified a new collective bargaining agreement with a group of union-represented employees, who were working without an agreement. The agreement resulted in plan amendments for one of our pension plans and our postretirement welfare benefit plan. These amendments eliminated future service under the plans and generated curtailments, which accelerated $11,146 of prior service credits for the postretirement welfare benefits plan and accelerates $29 of prior service costs for the pension plan. These amounts are included in non-service defined benefit income on the consolidated statements of operations for the year ended March 31, 2018.

curtailment gain of $8,427 and is presented on the accompanying Consolidated Statements of Operations as "Curtailments, settlements and early retirement incentives".

•

In November 2017, the Company announced an amendment to the postretirement welfare benefits plan for its non-represented employee participants. Effective January 1, 2018, the Company eliminated and reduced certain welfare benefits for non-represented retirees and active participants. Those changes resulted in a decrease in the OPEB obligation of $17,652 and a curtailment gain of $15,099 included in non-service defined benefit income on the consolidated statements of operations for the year ended March 31, 2018.

In March 2014, in connection with the Company's relocation plan, the Company has restructured the remaining workforce resulting in the termination of a number of defined benefit plan participants. The Company concluded that these terminations will result in a significant reduction in the remaining service period and recorded a curtailment loss of $8,031 and is presented on the accompanying Consolidated Statements of Operations as "Curtailment, settlements and early retirement incentives". This curtailment loss included an increase in the projected pension obligation of $6,503. Additionally, as part of the layoffs, the Company recorded an early retirement incentive severance charge of $916 and is presented on the accompanying Consolidated Statements of Operations in "Curtailments, settlements and early retirement incentives."

In December 2013, the Company completed an incentive offer in the form of lump-sum payments to non-represented deferred vested employees who were not of retirement age in lieu of any future benefits. In addition, cumulative lump-sum payments to union-represented plan participants for previously offered early retirement incentives exceeded the service and interest costs of the respective plan. The aforementioned changes led to a remeasurement of the affected plan's assets and obligations as of December 2013, which resulted in a $118,391 decrease in projected benefit obligation. Additionally, these distributions resulted in settlement charges of $1,561 and are presented on the accompanying Consolidated Statements of Operations within "Curtailments, settlements and early retirement incentives."

The following table shows those amounts expected to be recognized in net periodic benefit costs during the fiscal year ending March 31, 2017:2021:

		Pension Benefits				Other Postretirement Benefits
Amounts expected to be recognized in FY 2021 net    periodic benefit costs
Prior service credit		$	974			$	(5,105	)
Actuarial loss		$	32,899			$	(4,766	)

	Pension Benefits				Other Postretirement Benefits
Amounts expected to be recognized in FY 2017 net periodic benefit costs
Prior service cost (credit)	$	(1,782	)		$	(13,464	)
Actuarial (loss) gain	$	(11,985	)		$	6,588

Expected Pension Benefit Payments

The total estimated future benefit payments for the pension plans are expected to be paid from the plan assets and company funds. The other postretirement plan benefitOPEB payments reflect the Company's portion of the funding. Estimated future benefit payments from plan assets and Company funds for the next ten years are as follows:

Year		Pension Benefits				Other Postretirement Benefits*
2021		$	200,097			$	4,824
2022			163,389				813
2023			159,963				182
2024			155,123				171
2025			150,985				162
2026 – 2030			690,383				666

*	Net of expected Medicare Part D subsidies of $400 and $70 in the years ended March 31, 2021 and 2022, respectively.

Year	Pension Benefits				Other Postretirement Benefits*
2017	$	187,571			$	16,547
2018	172,446				15,973
2019	167,732				15,550
2020	165,695				14,953
2021	162,720				14,432
2022 - 2026	773,657				61,392

* Net of expected Medicare Part D subsidies of $730 to $1,220 per year.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

Plan Assets, Investment Policy and Strategy

The table below sets forth the Company's target asset allocation for fiscal 20162020 and the actual asset allocations at March 31, 20162020 and 2015.2019.

				Actual Allocation
		Target Allocation		March 31,
Asset Category		Fiscal 2020		2020				2019
Equity securities		40% - 50%			42	%			45	%
Fixed income securities		40% - 50%			50				48
Alternative investment funds		0% - 10%			6				5
Other		0% - 5%			2				2
Total					100	%			100	%

			Actual Allocation
	Target Allocation
			March 31,
Asset Category	Fiscal 2016		2016			2015
Equity securities	40 - 50%		48	%		45	%
Fixed income securities	40 - 50%		48			51
Alternative investment funds	0 - 10%		4			4
Total			100	%		100	%

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Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

Pension plan assets are invested in various asset classes that are expected to produce a sufficient level of diversification and investment return over the long-term. The investment goals are to exceed the assumed actuarial rate of return over the long-term within reasonable and prudent levels of risks and to meet future obligations.

Asset/liability studies are conducted on a regular basis to provide guidance in setting investment goals for the pension portfolio and its asset allocation. The asset allocation aims to prudently achieve a strong, risk-adjusted return while seeking to minimize funding level volatility and improve the funded status of the plans. The pension plans currently employ a liability-driven investment ("LDI") approach, where assets and liabilities move in the same direction. The goal is to limit the volatility of the funding status and cover part, but not all, of the changes in liabilities. Most of the liabilities' changes are due to interest rate movements.

To balance expected risk and return, allocation targets are established and monitored against acceptable ranges. All investment policies and procedures are designed to ensure that the plans' investments are in compliance with the Employee Retirement Income Security Act of 1974 ("ERISA"). Guidelines are established defining permitted investments within each asset class. Each investment manager has contractual guidelines to ensure that investments are made within the parameters of their asset class or in the case of multi-asset class managers, the parameters of their multi-asset class strategy. Certain investments are not permitted at any time, including investment directly in employer securities and uncovered short sales.

The tables below provide the fair values of the Company's plan assets at March 31, 20162020 and 2015,2019, by asset category. The table also identifies the level of inputs used to determine the fair value of assets in each category (see(refer to Note 2 for definition of levels).

	March 31, 2020
		Level 1				Level 2				Level 3				Total
Assets
Cash and cash equivalents		$	35,110			$	—			$	—			$	35,110
Equity securities
International			155,389				—				—				155,389
U.S. equity			2				—				—				2
U.S. commingled fund			400,131				—				—				400,131
International commingled fund			34,014				—				—				34,014
Fixed income securities
Corporate bonds			—				23,672				—				23,672
Government securities			—				93,677				—				93,677
U.S. commingled fund			605,487				—				—				605,487
Other
Insurance contracts			—				—				910				910
Total investment in securities—assets		$	1,230,133			$	117,349			$	910			$	1,348,392
U.S. equity commingled fund															8,180
International equity commingled fund															67,101
U.S. fixed income commingled fund															73,838
International fixed income commingled fund															1,380
Government securities commingled fund															8,333
Private equity and infrastructure															89,797
Other															1,534
Total investment measured at NAV as a    practical expedient														$	250,163
Receivables															3,292
Payables															(3,802	)
Total plan assets														$	1,598,045

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

		March 31, 2019
		Level 1				Level 2				Level 3				Total
Assets
Cash and cash equivalents		$	25,798			$	6,189			$	—			$	31,987
Equity securities
International			161,132				—				—				161,132
U.S. equity			8,464				—				—				8,464
U.S. commingled fund			489,463				—				—				489,463
International commingled fund			39,797				—				—				39,797
Fixed income securities
Corporate bonds			—				24,942				—				24,942
Government securities			—				109,306				—				109,306
U.S. commingled fund			654,269				—				—				654,269
Other
Insurance contracts			—				—				1,021				1,021
Total investment in securities—assets		$	1,378,923			$	140,437			$	1,021			$	1,520,381
U.S. equity commingled fund															4,690
International equity commingled fund															96,867
U.S. fixed income commingled fund															76,766
Private equity and infrastructure															95,760
Other															1,693
Total investment measured at NAV as a    practical expedient														$	275,776
Receivables															1,238
Payables															(1,284	)
Total plan assets														$	1,796,111

March 31, 2016
	Level 1				Level 2				Level 3				Total
Assets
Cash and cash equivalents	$	24,302			$	3,151			$	—			$	27,453
Equity securities
International	162,168				—				—				162,168
U.S. equity	78,155				—				—				78,155
U.S. commingled fund	570,500				5,226				—				575,726
International commingled fund	44,613				53,167				—				97,780
Fixed income securities
Corporate bonds	—				25,121				—				25,121
Government securities	—				159,432				—				159,432
U.S. commingled fund	622,605				74,447				—				697,052
International commingled fund	9,555				8,709				—				18,264
Other fixed income	—				7,286				—				7,286
Other
Private equity and infrastructure	—				—				71,571				71,571
Insurance contracts	—				—				1,349				1,349
Other	—				1,493				—				1,493
Total investment in securities—assets	$	1,511,898			$	338,032			$	72,920			$	1,922,850
Receivables													3,249
Payables													(414		)
Total plan assets													$	1,925,685

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

March 31, 2015
	Level 1				Level 2				Level 3				Total
Assets
Cash and cash equivalents	$	91,499			$	1,562			$	—			$	93,061
Equity securities
International	181,061				—				—				181,061
U.S. equity	72,911				—				—				72,911
U.S. commingled fund	619,297				—				—				619,297
International commingled fund	47,366				68,165				—				115,531
Fixed income securities
Corporate bonds	—				25,604				—				25,604
Government securities	—				182,456				—				182,456
U.S. commingled fund	676,557				90,341				—				766,898
International commingled fund	10,174				3,512				—				13,686
Other fixed income	—				8,415				—				8,415
Other
Private equity and infrastructure	—				—				79,692				79,692
Insurance contracts	—				—				920				920
Total investment in securities—assets	$	1,698,865			$	380,055			$	80,612			$	2,159,532
Receivables													2,609
Payables													(5,993		)
Total plan assets													$	2,156,148

Cash equivalents and other short-term investments are primarily held in registered short-term investment vehicles which are valued using a market approach based on quoted market prices of similar instruments.

Public equity securities, including common stock, are primarily valued using a market approach based on the closing fair market prices of identical instruments in the principal market on which they are traded. Commingled funds that are open-ended mutual funds for which the fair value per share is determined and published by the respective mutual fund sponsor and is the basis for current observable transactions are categorized as Level 1 fair value measures. All other

Investments in commingled investment funds for which the Company uses NAVand private equity and infrastructure funds are carried at net asset value ("NAV") as a practical expedient to estimate fair value per unit are categorized as Level 2 as long as they do not have redemption restrictions as of the measurement date. All commingled investment funds with redemption restrictions as of the measurement date are categorized as Level 3, if any.value. The NAV is the total value of the fund divided by the number of shares outstanding.

Adjustments to NAV, if any, are determined based on evaluation of data provided by fund managers, including valuation of the underlying investments derived using inputs such as cost, operating results, discounted future cash flows and market-based comparable data. In accordance with ASC 820-10, investments that are measured at NAV practical expedient are not classified in the fair value hierarchy; however, their fair value amounts are presented in these tables to permit reconciliation of the fair value hierarchy to the total plan assets disclosed in this footnote.

Corporate, government agency bonds and mortgage-backed securities are primarily valued using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported observable trades for identical or comparable instruments.

Other investments include private equity and infrastructure funds and insurance contracts. Investments in private equity and infrastructure funds are carried at estimated fair value based on NAV as a practical expedient and other appropriate adjustments to NAV as determined based on an evaluation of data provided by fund managers, including valuations of the underlying investments derived using inputs such as cost, operating results, discounted future cash flows, and market-based comparable data.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

The following table represents a rollforward of the balances of our pension plan assets that are valued using Level 3 inputs:

	March 31, 2015, Balance				Acquisitions				Net Purchases (Sales)				Net Realized Appreciation (Depreciation)				Net Unrealized Appreciation (Depreciation)				March 31, 2016, Balance
Private equity funds	$	79,692			$	—			$	(15,184	)		$	(15,223	)		$	22,286			$	71,571
Insurance contracts	920				—				—				—				429				1,349
Total	$	80,612			$	—			$	(15,184	)		$	(15,223	)		$	22,715			$	72,920

	March 31, 2014, Balance				Acquisitions				Net Purchases (Sales)				Net Realized Appreciation (Depreciation)				Net Unrealized Appreciation (Depreciation)				March 31, 2015, Balance
Private equity funds	$	89,113			$	—			$	(20,757	)		$	(1,002	)		$	12,338			$	79,692
Insurance contracts	—				920				—				—				—				920
Total	$	89,113			$	920			$	(20,757	)		$	(1,002	)		$	12,338			$	80,612

Assumptions and Sensitivities

The discount rate is determined as of each measurement date, based on a review of yield rates associated with long-term, high-quality corporate bonds. The calculation separately discounts benefit payments using the spot rates from a long-term, high-quality corporate bond yield curve.

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

The effect of a 25 basis-point change in discount rates as of March 31, 2016,2020, is shown below:

		Pension Benefits				Other Postretirement Benefits
Increase of 25 basis points
Obligation	*	$	(56,208	)		$	(44	)
Net periodic expense			104				(144	)
Decrease of 25 basis points
Obligation	*	$	58,058			$	46
Net periodic expense			(235	)			149

*	Excludes impact to plan assets due to the LDI investment approach discussed above under "Plan Assets, Investment Policy and Strategy."

		Pension Benefits				Other Postretirement Benefits
Increase of 25 basis points
Obligation	*	$	(66,900	)		$	(3,685	)
Net periodic expense		(300		)		(292		)
Decrease of 25 basis points
Obligation	*	$	70,100			$	3,837
Net periodic expense		300				303

* Excludes impact to plan assets due to the LDI investment approach discussed above under "Plan Assets, Investment Policy and Strategy."

The long-term rate of return assumption represents the expected average rate of earnings on the funds invested to provide for the benefits included in the benefit obligations. The long-term rate of return assumption is determined based on a number of factors, including historical market index returns, the anticipated long-term asset allocation of the plans, historical plan return data, plan expenses and the potential to outperform market index returns. For fiscal 20116, the expected long-term rate of return on assets was 6.50 - 8.25%. For fiscal 2017,2021, the expected long-term rate of return is 6.50 5.00%- 8.00%.

A significant factor used in estimating future per capita cost of covered health care benefits for our retirees and us is the health care cost trend rate assumption. The rate used at March 31, 2016, was 6.60% and is assumed to decrease gradually to 4.50% by fiscal 2027 and remain at that level thereafter. The effect of a one-percentage-point change in the healthcare cost trend rate in each year is shown below:

	Other Postretirement Benefits
	One-Percentage- Point Increase				One-Percentage- Point Decrease
Net periodic expense	$	515			$	(439	)
Obligation	7,698				(6,943		)

Anticipated Contributions to Defined Benefit and Postretirement Welfare Benefit Plans

Assuming a normal retirement age of 65, the

The Company does not expect to contribute to its qualified U.S. defined benefit pension plans during fiscal 2021.  The Company expects to contribute $40,000$4,824 to its defined benefit pension plans and $16,500 to its OPEBpostretirement welfare benefits plan during fiscal 2017. No2021. NaN plan assets are expected to be returned to the Company in fiscal 2017.

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

16.	STOCK COMPENSATION PLANS

2021.

16.STOCK COMPENSATION PLANS

The Company has stock incentive plans under which employees and non-employee directors may be granted optionsequity awards to purchaseacquire shares of the Company's common stock at the fair value at the time of the grant. Employee optionsThe stock incentive and compensation plans under which outstanding equity awards have been granted to employees, officers and non-employee director optionsdirectors are fully vestedthe Triumph Group 2018 Equity Plan (the "2018 Plan"), the Triumph Group 2013 Equity and Cash Incentive Plan (the “2013 Plan”), the 2016 Directors’ Equity Compensation Plan, as of March 31, 2016amended (the “Directors’ Plan”), and the Amended and Restated Directors’ Stock Incentive Plan (the “Prior Directors’ Plan”). There were no employee or non-employee director options grantedThe Prior Directors’ Plan expired by its terms during fiscal years ended March 31, 2016, 20152017. The current stock incentive and 2014.

Since fiscal 2006,compensation plans used for future awards are the Company approved2013 Plan for employees, officers and consultants, the granting ofDirectors’ Plan, and the 2018 Plan. The 2018 Plan, the 2013 Plan, the Directors’ Plan, and the Prior Directors’ Plan are collectively referred to in this note as the plans.

Management and the compensation committee have utilized restricted stock and restricted stock units as its primary form of share-based incentive.incentive compensation. The restricted sharesstock and restricted stock units are subject to graded vesting, generally over a three year period and are subject to forfeiture should the grantee's employment be terminated prior to the third or fourth anniversary of the date of grant,an applicable vesting date. The share-based payment expense arising from restricted stock and arerestricted stock unit expense is included in capital in excess of par value. Restricted shares generally vest in full after three or four years. The fair value of restricted shares under the Company's restricted stock plans is determined by the product of the number of shares granted and the grant date market price of the Company's common stock.  CertainThe fair value of theseshare-based compensation granted to employees was $13,249, $15,911, and $18,122 during the fiscal years ended March 31, 2020, 2019, and 2018, respectively.  The awards contain service conditions and may also contain performance or market conditions in addition to service conditions.that affect the number of shares that vest. The fair value of restricted sharesstock and restricted stock unit awards is expensed on a straight-line basis over the requisite service period of three or four years.

which is typically the vesting period.  The Company recognized $2,657, $1,272$11,062, $10,259 and $4,653$7,949 of share-based compensation expense during the fiscal years ended March 31, 2016, 2015 and 2014, respectively. The total income tax benefit recognized for share-based compensation arrangements for fiscal years ended March 31, 2016, 2015 and 2014, was $930, $445 and $1,629, respectively.

A summary of the Company's stock option activity and related information for its option plans for the fiscal year ended March 31, 2016, was as follows:

	Options			Weighted- Average Exercise Price				Weighted- Average Remaining Contractual Term (in Years)		Aggregate Intrinsic Value
Outstanding at March 31, 2015	3,936			$	15.37
Exercised	—			—
Forfeited	(3,936	)		15.37
Outstanding at March 31, 2016	—			$	—			0		$	—

During the fiscal year ended March 31, 2016, the balance of outstanding stock options expired. The intrinsic value of stock options exercised during the fiscal years ended March 31, 20152020, 2019, and 2014, was $2,2342018, respectively. The Company has classified share-based compensation within selling, general and $1,043, respectively.

administrative expenses to correspond with the same line item as the majority of the cash compensation paid to employees. 

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Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

At March 31, 20162020 and 2015, 5,006,1092019, 1,564,791 shares and 5,070,4095,586,421 shares of common stock, respectively, were available for issuance under the plans. A summary of the status of the Company's nonvested sharesnon-vested shares/units of restricted stock and deferred stock units as of March 31, 2016,2020, and changes during the fiscal year ended March 31, 2016,2020, is presented below:below.

		Shares				Weighted- Average Grant Date Fair Value
Non-vested restricted awards and deferred stock units at March 31, 2019			1,081,379			$	26.01
Granted			598,879				22.12
Vested			(282,330	)			24.98
Forfeited			(238,298	)			22.18
Non-vested restricted awards and deferred stock units at March 31, 2020			1,159,630			$	24.40

	Shares			Weighted- Average Grant Date Fair Value
Nonvested restricted stock and deferred stock units at March 31, 2015	175,382			$	61.79
Granted	66,800			63.68
Vested	(55,289	)		71.39
Forfeited	(17,002	)		76.99
Nonvested restricted stock and deferred stock units at March 31, 2016	169,891			$	57.88

The fair value of employee restricted stock which vested during fiscal 20162020, 2019 and 2018 was $3,297. The tax benefit from vested$7,052, $7,031, and $2,081, respectively.  Upon the vesting of restricted stock was $96, $673 and $2,726 duringunits, the fiscal years ended March 31, 2016, 2015 and 2014, respectively. The weighted-average grant date fair value of share-based grants in the fiscal years ended March 31, 2016, 2015 and 2014, was $63.68, $64.44 and $79.80, respectively.Company first transfers treasury stock, then will issue new shares.  Expected future compensation expense on restricted stock net of expected forfeitures, is approximately $2,590,$10,320, which is expected to be recognized over the remaining weighted-averageweighted average vesting period of 2.11.5 years.

During the fiscal years ended March 31, 2016, 2015 and 2014, 15,200, 8,800 and 7,875 deferred stock units were granted to the non-employee members of the Board of Directors, respectively, under the Directors' Plan. Each deferred stock unit represents the contingent right to receive one share of the Company's common stock. The deferred stock units vest over a three or four-year period and the shares of common stock underlying vested deferred stock units will be delivered on January 1 of the year following the year in which the non-employee director terminates service as a Director of the Company.

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(Dollars in thousands, except per share data)

17.	COMMITMENTS AND CONTINGENCIES

Real Estate Lease Litigation over Claims of American Brownfield MCIC, LLC

As previously disclosed, on June 13, 2013, American Brownfield MCIC, LLC (“American Brownfield”) filed suit (the “Lawsuit”) in the 298th Judicial District Court of Dallas County, Texas against Triumph Aerostructures, LLC (“Triumph Aerostructures”), a wholly-owned subsidiary of the Company, for amounts allegedly owed pursuant to a lease dated October 24, 2007, covering the use and occupancy of approximately 314 acres of land and improvements in Dallas, Texas, previously known as the Naval Weapons Industrial Reserve Plant (the “Jefferson Street Facility”). Triumph Aerostructures, the Company, and American Brownfield agreed to a mediated settlement of the Lawsuit, effective November 18, 2015. Under the terms of the settlement, American Brownfield was paid $5,000 on November 23, 2015, which is included in Legal settlement charge (gain), net, on the Consolidated Statements of Operations and is entitled to a second payment of $5,500 on or before May 20, 2016. The Lawsuit has been administratively closed, and will be dismissed with prejudice upon receipt by American Brownfield of the second payment. Also as part of the settlement, the Company has leased 272,683 square feet of space at the Jefferson Street Facility for a 15 year term beginning December 1, 2015, for annual base rent of $1,250.

Trade Secret Litigation over Claims of Eaton Corporation

On June 18, 2014, the Company announced it had settled all pending litigation involving the Company, its subsidiary, the employees and Eaton Corporation and several of its subsidiaries ("Eaton"). As it pertained to the lawsuit by Eaton claiming alleged misappropriation of trade secrets and intellectual property allegedly belonging to Eaton relating to the design and manufacture of hydraulic pumps and motors used in military and commercial aviation. As part of the settlement, Eaton agreed to pay the Company $135,300 in cash. During the fiscal year ended March 31, 2015, the Company received payment representing a gain on legal settlement, net of expense, of $134,693, which is included on the Consolidated Statements of Operations.

Other

17.    COMMITMENTS AND CONTINGENCIES

Certain of the Company's business operations and facilities are subject to a number of federal, state, local and foreign environmental laws and regulations. Former owners generally indemnify the Company for environmental liabilities related to the assets and businesses acquired which existed prior to the acquisition dates. In the opinion of management, there are no significant environmental contingent liabilities which would have a material effect on the financial condition or operating results of the Company which are not covered by such indemnification.

As the Company completes its restructuring plans as disclosed in Note 18, including the disposal of certain facilities, the Company may be exposed to additional costs such as environmental remediation obligations, lease termination costs, or supplier claims which may have a material effect on its financial position or results of operations when such matters arise and a reasonable estimate of the costs can be made.

The Company's risk related to pension projected obligations as of March 31, 2016,2020, is significant. This amount is currently in excess of the related plan assets. Benefit plan assets are invested in a diversified portfolio of investments in both the equity and debt categories, as well as limited investments in real estate and other alternative investments. The market value of all of these investment categories may be adversely affected by external events and the movements and volatility in the financial markets, including such events as the current credit and real estate market conditions. Declines in the market values of our plan assets could expose the total asset balance to significant risk which may cause an increase to future funding requirements. The Company's potential risk related to OPEB projected obligations as of March 31, 2016, is also significant.

Some raw materials and operating supplies are subject to price and supply fluctuations caused by market dynamics. The Company's strategic sourcing initiatives seek to find ways of mitigating the inflationary pressures of the marketplace. In recent years, these inflationary pressures have affected the market for raw materials. However, the Company believes that raw material prices will remain stable through the remainder of fiscal 20172021 and after that, experience increases that are in line with inflation. Additionally, the Company generally does not employ forward contracts or other financial instruments to hedge commodity price risk.

The Company's suppliers' failure to provide acceptable raw materials, components, kits and subassemblies would adversely affect production schedules and contract profitability. The Company maintains an extensive qualification and performance surveillance system to control risk associated with such supply base reliance. The Company is dependent on third parties for certain information technology services. To a lesser extent, the Company is also exposed to fluctuations in the prices of certain utilities and services, such as electricity, natural gas, chemical processing and freight. The Company utilizes a range of long-term agreements and strategic aggregated sourcing to optimize procurement expense and supply risk in these categories.

In the ordinary course of business, the Company is also involved in disputes, claims and lawsuits with employees, suppliers and customers, as well as governmental and regulatory inquiries, that it deems to be immaterial. Some may involve claims or potential claims of substantial damages, fines, penalties or penalties.injunctive relief. While the Company cannot predict the outcome of any pending or future litigation or proceeding and no

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(Dollars in thousands, except per share data)

assurances can be given, the Company does not believe that any pending matter will have a material effect, individually or in the aggregate, on its financial position or results of operations.

18.	RESTRUCTURING COSTS

Fiscal 2016 Restructuring

During the In fiscal year ended March 31, 2016,2020, the Company was awarded $9,257 in a legal judgment associated with a longstanding litigation matter arising from a prior acquisition.

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Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

18.RESTRUCTURING COSTS

The Company committed to avarious restructuring ofplans involving certain of its businesses, as well as the consolidation of certain of its facilities ("2016 Restructuring Plan"). The Company expectsover the past several years. With the exception of certain consolidations to reduce its footprint by approximately 3.5 million square feet and to reduce head count by 1,200 employees. Over the next few fiscal years, the Company estimates that it will record aggregate pre-tax charges of $150,000 to $160,000 related to these programs, which represent employee termination benefits, contract termination costs, accelerated depreciation and facility closure and other exit costs, and will resultbe completed in future cash outlays. For the fiscal year endedyears, these plans were substantially complete as of March 31, 2016, the Company recorded charges of $80,956 related to this program including, accelerated depreciation of $22,392 and severance of $16,300.

The following table provides a summary of the Company's current aggregate cost estimates by major type of expense associated with the 2016 Restructuring Plan:

Type of expense		Total estimated amount expected to be incurred
Termination benefits		$	26,000
Facility closure and other exit costs (1)		40,000
Contract termination costs		25,000
Accelerated depreciation charges (2)		34,000
Other (3)		30,000
		$	155,000

(1) Includes costs to transfer product lines among facilities and outplacement and employee relocation costs.

(2) Accelerated depreciation charges are recorded as part of Depreciation and amortization on the Consolidated Statement of Operations.

(3) Consists of other costs directly related to the plan, including project management, legal and regulatory costs.

The restructuring charges recognized for the fiscal year ended March 31, 2016, by type and by segment consisted of the following:

	Aerostructures			Aerospace Systems			Aftermarket Services			Corporate			Total
Termination benefits	$	11,379		$	463		$	397		$	4,061		$	16,300
Facility closure and other exit costs	14,295			—			—			—			14,295
Other	—			—			—			5,587			5,587
Total Restructuring	25,674			463			397			9,648			36,182
Depreciation and Amortization	8,861			3,368			145			—			12,374
Included in Cost of sales
Contract termination costs	12,100			—			—			—			12,100
Accelerated depreciation	10,018			—			—			—			10,018
Other	6,032			4,250			—			—			10,282
Total	$	62,685		$	8,081		$	542		$	9,648		$	80,956

Termination benefits include employee retention, severance and benefit payments for terminated employees. Facility closure costs include general operating costs incurred subsequent to production shutdown as well as equipment relocation and other associated costs. Contract termination costs include costs associated with terminating existing leases and supplier agreements. Other costs include legal, outplacement and employee relocation costs and other employee-related costs.

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(Dollars in thousands, except per share data)

Relocation to Red Oak

During the fiscal year ended March 31, 2013, the Company committed to relocate the operations of its largest facility in Dallas, Texas and to expand its Red Oak, Texas ("Red Oak") facility to accommodate this relocation.2019.  The Company incurred approximately $86,640 in capital expenditurescosts of $25,340 associated with new restructuring plans during fiscal year 2020. These costs, the fiscal years endedmajority of which are being incurred within the Systems & Support reportable segment and relate to third-party consulting costs, are substantially complete as of March 31, 2014, associated with this plan. The Company incurred $3,1932020.

19.    CUSTOMER CONCENTRATION

Trade and $31,290 of moving expenses related to the relocation during the fiscal year ended March 31, 2015 and 2014, shown separately on the Consolidated Statements of Operations. The relocation was substantially completed during the fiscal year ended March 31, 2014.

19.	CUSTOMER CONCENTRATION

Tradeother accounts receivable from The Boeing Company ("Boeing") represented approximately 18%21% and 13%18% of total accounts receivable as of March 31, 20162020 and 2015,2019, respectively. Trade and other accounts receivable from Gulfstream Aerospace Corporation ("Gulfstream") represented approximately 6% and 16%11% of total accounts receivable as of March 31, 20162020 and 2015,2019, respectively. Trade and other accounts receivables from Bombardier represented approximately 16% and 13% of total accounts receivable as of March 31, 2020 and 2019, respectively, and include receivables from transition services. The Company had no other significant concentrations of credit risk.

Sales to Boeing for fiscal 20162020 were $1,472,641,$983,762, or 38%34% of net sales, of which $1,237,523, $200,020$254,659 and $35,098$729,103 were from the Aerostructures segment, theSystems & Support and Aerospace Systems segment and the Aftermarket Services segment, respectively. Sales to Boeing for fiscal 2015 were $1,634,367, or 42% of net sales, of which $1,441,892, $161,196 and $31,279 were from the Aerostructures segment, the Aerospace Systems segment and the Aftermarket Services segment,Structures, respectively. Sales to Boeing for fiscal 20142019 were $1,689,635,$1,031,107, or 45%31% of net sales, of which $1,576,113, $87,374$243,047 and $26,148$788,061 were from the Aerostructures segment, theSystems & Support and Aerospace Structures, respectively. Sales to Boeing for fiscal 2018 were $1,004,274, or 31% of net sales, of which $216,122 and $788,151 were from Systems segment& Support and the Aftermarket Services segment,Aerospace Structures, respectively.

Sales to Gulfstream for fiscal 20162020 were $476,327,$337,173, or 12% of net sales, of which $472,627, $3,492$3,250 and $208$333,924 were from the Aerostructures segment, theSystems & Support and Aerospace Systems segment and the Aftermarket Services segment, respectively. Sales to Gulfstream for fiscal 2015 were $338,719, or 9% of net sales, of which $334,948, $3,745 and $26 were from the Aerostructures segment, the Aerospace Systems segment and the Aftermarket Services segment,Structures, respectively. Sales to Gulfstream for fiscal 20142019 were $290,028,$361,451, or 8%11% of net sales, of which $285,252, $4,279$3,068 and $497$358,382 were from the Aerostructures segment, theSystems & Support and Aerospace Structures, respectively. Sales to Gulfstream for fiscal 2018 were $421,985, or 13% of net sales, of which $1,780 and $420,204 were from Systems segment& Support and the Aftermarket Services segment,Aerospace Structures, respectively.

No other single customer accounted for more than 10% of the Company's net sales; however, the loss of any significant customer, including Boeing and/or Gulfstream, could have a material adverse effect on the Company and its operating subsidiaries.

The Company currently generates a majority of its revenue from clients in the commercial aerospace industry, the business jet industry and the military. The Company's growth and financial results are largely dependent on continued demand for its products and services from clients in these industries. If any of these industries experiences a downturn, clients in these sectors may conduct less business with the Company.

20.	COLLECTIVE BARGAINING AGREEMENTS

20.    COLLECTIVE BARGAINING AGREEMENTS

Approximately 13%18% of the Company's labor force is covered under collective bargaining agreements. As of March 31, 2016, approximately 31%2020, none of the Company's collectively bargained workforce are working under contracts that have expired, orand 5% of the Company’s collectively bargained workforce are working under contracts that are set to expire within one year.

The

During the fiscal year ended March 31, 2018, the Company ratified a collective bargaining agreement with ourits union employees with United Autoworkers of America and its Local Union 848 at its Red Oak, Texas, facility.

During the fiscal year ended March 31, 2019, the Company ratified a collective bargaining agreement with its union employees with United Autoworkers of America and its Local Union 952 at its Tulsa, Oklahoma facility. Also occurring during the fiscal year ended March 31, 2019, the Stuart Florida facility production and maintenance employees elected the United Autoworkers of America, Local #2505, to represent them in collective bargaining with the Company.  As of the March 31, 2020, the union and the Company have not reached an agreement.  

During the fiscal year ended March 31, 2020, effects and closure agreements were made for the Tulsa, Oklahoma, and Grand Prairie, Texas, locations.  In addition, the Company and leadership of Aero Lodge No.735 of the International Association of Machinists and Aerospace Workers ("IAM"(“IAM”) District 751 at our Spokane, Washington facility has expired. Asagreed to negotiate a Memorandum of May 11, 2016,Agreement to sunset the workforce in Spokane of approximately 400 employees has electedretiree medical plans.  Both the Company and the IAM leadership full endorsed this agreement, and local IAM members voted to strike. While we are currently in negotiations with the workforce, we have implemented plansratify it on August 10, 2019.  

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Notes to continue production in Spokane with support from other locations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Consolidated Financial Statements

(Dollars in thousands, except per share data)

21.	SEGMENTS

21.SEGMENTS

The Company reports financial performance based on the following three2 reportable segments: Systems & Support and Aerospace Structures. The Company’s reportable segments are aligned with how the Aerostructures Group, the Aerospace Systems Groupbusiness is managed, and the Aftermarket Services Group.Company's views of the markets it serves. The Company'sChief Operating Decision Maker (the "CODM") evaluates performance and allocates resources based upon review of segment information. The CODM utilizes earnings before interest, income taxes, depreciation and amortization, and pension (“Adjusted EBITDAEBITDAP”) as a primary measure of segment profitability to evaluate performance of its segments and allocate resources.

The Aerostructures segment consists of the Company's operations that manufacture products primarily for the aerospace OEM market. The Aerostructures segment's revenues are derived from the design, manufacture, assembly and integration of metallic and composite aerostructures and structural components, including aircraft wings, fuselage sections, tail assemblies, engine nacelles, flight control surfaces as well as helicopter cabins. Further, the segment's operations also design and manufacture composite assemblies for floor panels and environmental control system ducts. These products are sold to various aerospace OEMs on a global basis. Effective April 1, 2015, the results for Triumph Group Mexico are included in the Aerostructures segment, as doing so better represents the type of work Triumph Group Mexico is performing. Previously, Triumph Group Mexico's results were included in Corporate.

The Aerospace Systems segment consists of the Company's operations that also manufacture products primarily for the aerospace OEM market. The segment's operations design and engineer mechanical and electromechanical controls, such as hydraulic systems, main engine gearbox assemblies, engine control systems, accumulators, mechanical control cables and non-structural cockpit components. These products are sold to various aerospace OEMs on a global basis.

The Aftermarket Services segment consists of the Company's operations that provide maintenance, repair and overhaul services to both commercial and military markets on components and accessories manufactured by third parties. Maintenance, repair and overhaul revenues are derived from services on auxiliary power units, airframe and engine accessories, including constant-speed drives, cabin compressors, starters and generators, and pneumatic drive units. In addition, the segment's operations repair and overhaul thrust reversers, nacelle components and flight control surfaces. The segment's operations also perform repair and overhaul services and supply spare parts for various types of cockpit instruments and gauges for a broad range of commercial airlines on a worldwide basis.

Segment Adjusted EBITDAEBITDAP is total segment revenue reduced by operating expenses (less depreciation and amortization) identifiable with that segment. Corporate includes general corporate administrative costs and any other costs not identifiable with one of the Company'sCompany’s segments, including restructuringloss on sale of $10,347assets and businesses of $67,037 for the fiscal year ended March 31, 2016.

Effective April 2016, the Company announced that it is realigning into four business units to better meet the evolving needs of its customers. The new structure better supports our go-to-market strategies and will allow us to more effectively satisfy the needs of our customers while continuing to deliver on our commitments, accelerate organic growth and drive predictable profitability.

2020.

The Company does not accumulate net sales information by product or service or groups of similar products and services, and therefore the Company does not disclose net sales by product or service because to do so would be impracticable.

Selected financial information for each reportable segment is as follows:

		Year Ended March 31, 2020
		Total				Corporate & Eliminations				Systems & Support				Aerospace Structures
Net sales to external customers		$	2,900,117			$	—			$	1,350,761			$	1,549,356
Intersegment sales (eliminated in consolidation)			—				(13,334	)			6,803				6,531
Segment profit and reconciliation to consolidated income before income taxes:
Adjusted EBITDAP			305,784				—				205,352				100,432
Reconciliation of segment profit to income (loss) before income taxes
Depreciation and amortization			(138,168	)			(3,374	)			(32,376	)			(102,418	)
Interest expense and other, net			(122,129	)
Corporate expenses			(53,082	)
Share-based compensation expense			(11,062	)
Loss on sale of assets and businesses			(56,916	)
Amortization of acquired contract liabilities			75,286
Non-service defined benefit income			41,894
Union represented employee incentives			(7,071	)
Legal judgment gain, net			9,257
Impairment of goodwill			(66,121	)
Income before income taxes			(22,328	)
Total capital expenditures		$	39,834			$	1,502			$	17,141			$	21,191
Total assets		$	2,980,333			$	481,162			$	1,478,679			$	1,020,492

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Triumph Group, Inc.

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

		Year Ended March 31, 2019
		Total				Corporate & Eliminations				Systems & Support				Aerospace Structures
Net sales to external customers		$	3,364,930			$	—			$	1,309,474			$	2,055,456
Intersegment sales (eliminated in consolidation)			—				(22,485	)			15,537				6,948
Segment profit and reconciliation to consolidated income before income taxes:
Adjusted EBITDAP			215,418				—				202,346				13,072
Reconciliation of segment profit to income (loss) before income taxes
Depreciation and amortization			(149,904	)			(3,100	)			(35,373	)			(111,431	)
Interest expense and other, net			(114,619	)
Corporate expenses			(74,706	)
Share-based compensation expense			(10,259	)
Loss on sale of assets and businesses			(235,301	)
Amortization of acquired contract liabilities			67,314
Non-service defined benefit income			62,105
Loss on adoption of ASU 2017-07			(87,241	)
Income before income taxes			(327,193	)
Total capital expenditures		$	47,099			$	784			$	15,734			$	30,581
Total assets		$	2,854,574			$	110,372			$	1,487,163			$	1,257,039

		Year Ended March 31, 2018
		Total				Corporate & Eliminations				Systems & Support				Aerospace Structures
Net sales to external customers		$	3,198,951			$	—			$	1,253,640			$	1,945,311
Intersegment sales (eliminated in consolidation)			—				(23,286	)			13,868				9,418
Segment profit and reconciliation to consolidated income before income taxes:
Adjusted EBITDAP			229,534				—				235,540				(6,006	)
Reconciliation of segment profit to income (loss) before income taxes
Depreciation and amortization			(158,368	)			(1,852	)			(42,730	)			(113,786	)
Interest expense and other, net			(99,442	)
Corporate expenses			(88,037	)
Share-based compensation expense			(7,949	)
Loss on sale of assets and businesses			(30,741	)
Amortization of acquired contract liabilities			125,148
Non-service defined benefit income			103,234
Impairment of goodwill			(535,227	)
Income before income taxes			(461,848	)
Total capital expenditures		$	42,050			$	4,179			$	8,352			$	29,519

Selected financial information for each reportable segment and the reconciliation of Adjusted EBITDA to operating income before interest is as follows:

	Year Ended March 31,
	2016				2015				2014
Net sales:
Aerostructures	$	2,427,809			$	2,510,371			$	2,622,917
Aerospace systems	1,166,795				1,089,117				871,750
Aftermarket services	311,394				304,013				287,343
Elimination of inter-segment sales	(19,926		)		(14,779		)		(18,756		)
	$	3,886,072			$	3,888,722			$	3,763,254
(Loss) income before income taxes:
Operating (loss) income:
Aerostructures	$	(1,274,777	)		$	120,985			$	248,637
Aerospace systems	216,520				184,042				149,721
Aftermarket services	24,977				47,931				42,265
Corporate	(57,826		)		81,715				(40,619		)
	(1,091,106		)		434,673				400,004
Interest expense and other	68,041				85,379				87,771
	$	(1,159,147	)		$	349,294			$	312,233
Depreciation and amortization:
Aerostructures	$	114,986			$	102,296			$	116,514
Aerospace systems	50,118				45,200				37,453
Aftermarket services	11,009				8,559				7,529
Corporate	1,642				2,268				2,781
	$	177,755			$	158,323			$	164,277
Impairment charge of intangible assets:
Aerostructures	$	873,961			$	—			$	—
Aerospace systems	400				—				—
	$	874,361			$	—			$	—
Amortization of acquired contract liabilities, net:
Aerostructures	$	90,778			$	38,719			$	25,207
Aerospace systems	41,585				37,014				17,422
	$	132,363			$	75,733			$	42,629
Adjusted EBITDA:
Aerostructures	$	(364,538	)		$	184,562			$	339,944
Aerospace systems	216,959				192,228				169,752
Aftermarket services	37,886				56,490				49,794
Corporate	(57,428		)		(50,710		)		(36,672		)
	$	(167,121	)		$	382,570			$	522,818

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(Dollars in thousands, except per share data)

	Year Ended March 31,
	2016				2015				2014
Capital expenditures:
Aerostructures	$	45,478			$	72,681			$	168,715
Aerospace systems	30,883				30,531				21,935
Aftermarket services	2,700				5,645				13,940
Corporate	986				1,147				1,824
	$	80,047			$	110,004			$	206,414

	March 31,
	2016				2015
Total Assets:
Aerostructures	$	3,023,892			$	4,097,397
Aerospace systems	1,437,977				1,460,142
Aftermarket services	350,674				375,752
Corporate	22,550				23,034
	$	4,835,093			$	5,956,325

During fiscal years ended March 31, 2016, 20152020, 2019, and 2014,2018, the Company had foreign sales of $797,976, $753,075$724,193, $960,299, and $621,625,$758,936, respectively. The Company reports as foreign sales those sales with delivery points outside of the United States. As of March 31, 20162020 and 2015,2019, the Company had foreign long-lived assets of $346,924$205,243 and $366,846,$294,990, respectively.

22.	SELECTED CONSOLIDATING FINANCIAL STATEMENTS OF PARENT, GUARANTORS AND NON-GUARANTORS

The 2021 Notes and the 2022 Notes are fully and unconditionally guaranteed on a joint and several basis by Guarantor Subsidiaries. The total assets, stockholder's equity, revenue, earnings and cash flows from operating activities of the Guarantor Subsidiaries exceeded a majority of the consolidated total of such items as of and for the periods reported. The only consolidated subsidiaries of the Company that are not guarantors of the 2021 Notes and the 2022 Notes (the "Non-Guarantor Subsidiaries") are: (i) the receivables securitization special purpose entity, and (ii) the foreign operating subsidiaries. The following tables present condensed consolidating financial statements including

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Triumph Group, Inc. (the "Parent"), the Guarantor Subsidiaries, and the Non-Guarantor Subsidiaries. Such financial statements include balance sheets as of March 31, 2016 and 2015, statements of operations and comprehensive income for the fiscal years ended March 31, 2016, 2015 and 2014, and statements of cash flows for the fiscal years ended March 31, 2016, 2015 and 2014.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Notes to Consolidated Financial Statements

(Dollars in thousands, except per share data)

SUMMARY CONSOLIDATING BALANCE SHEETS:

	March 31, 2016
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Current assets:
Cash and cash equivalents	$	1,544			$	201			$	19,239			$	—			$	20,984
Trade and other receivables, net	2,057				127,968				314,183				—				444,208
Inventories	—				1,091,824				92,414				—				1,184,238
Rotable assets	—				35,451				16,501				—				51,952
Prepaid expenses and other	6,524				26,433				8,302				—				41,259
Total current assets	10,125				1,281,877				450,639				—				1,742,641
Property and equipment, net	7,324				746,455				135,955				—				889,734
Goodwill and other intangible assets, net	—				1,898,401				195,465				—				2,093,866
Other, net	11,878				76,262				20,712				—				108,852
Intercompany investments and advances	2,301,054				81,540				82,930				(2,465,524		)		—
Total assets	$	2,330,381			$	4,084,535			$	885,701			$	(2,465,524	)		$	4,835,093
Current liabilities:
Current portion of long-term debt	$	28,473			$	13,968			$	—			$	—			$	42,441
Accounts payable	11,154				346,602				52,469				—				410,225
Accrued expenses	44,856				599,921				38,431				—				683,208
Total current liabilities	84,483				960,491				90,900				—				1,135,874
Long-term debt, less current portion	1,120,570				63,009				191,300				—				1,374,879
Intercompany debt	171,480				1,972,729				330,176				(2,474,385		)		—
Accrued pension and other postretirement benefits, noncurrent	7,315				654,201				3,148				—				664,664
Deferred income taxes and other	11,589				658,873				54,270				—				724,732
Total stockholders' equity	934,944				(224,768		)		215,907				8,861				934,944
Total liabilities and stockholders' equity	$	2,330,381			$	4,084,535			$	885,701			$	(2,465,524	)		$	4,835,093

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NOTES TO CONSOLIDATED

22.    QUARTERLY FINANCIAL STATEMENTS (Continued)INFORMATION (UNAUDITED)

		Fiscal 2020																Fiscal 2019
		June 30				Sept. 30				Dec. 31				Mar. 31				June 30				Sept. 30				Dec. 31				Mar. 31
BUSINESS SEGMENT SALES
Systems & Support		$	313,605			$	352,969			$	338,924			$	352,066			$	306,632			$	332,562			$	323,619			$	362,198
Aerospace Structures			419,178				422,579				368,972				345,158				532,387				528,366				490,337				511,314
Inter-segment Elimination			(2,552	)			(3,438	)			(3,230	)			(4,114	)			(6,119	)			(5,820	)			(6,061	)			(4,485	)
TOTAL SALES		$	730,231			$	772,110			$	704,666			$	693,110			$	832,900			$	855,108			$	807,895			$	869,027
GROSS PROFIT (1)		$	119,461			$	131,456			$	142,200			$	116,085			$	38,742			$	107,357			$	72,007			$	131,239
OPERATING INCOME (LOSS)
Systems & Support		$	44,048			$	62,337			$	57,434			$	(22,478	)		$	43,078			$	51,380			$	51,368			$	55,270
Aerospace Structures			12,283				13,608				18,039				(2,066	)			(79,587	)			(22,744	)			(49,813	)			(264	)
Corporate			(20,820	)			(14,908	)			(73,812	)			(15,758	)			(30,039	)			(30,637	)			(18,488	)			(244,203	)
TOTAL OPERATING INCOME (LOSS)		$	35,511			$	61,037			$	1,661			$	(40,302	)		$	(66,548	)		$	(2,001	)		$	(16,933	)		$	(189,197	)
NET LOSS		$	18,088			$	42,701			$	(13,846	)		$	(75,069	)		$	(76,534	)		$	(14,676	)		$	(30,945	)		$	(199,612	)
Basic Income (Loss) per share		$	0.36			$	0.85			$	(0.27	)		$	(1.45	)		$	(1.54	)		$	(0.30	)		$	(0.62	)		$	(4.01	)
Diluted Income (Loss) per share		$	0.36			$	0.85			$	(0.27	)		$	(1.45	)		$	(1.54	)		$	(0.30	)		$	(0.62	)		$	(4.01	)

(Dollars in thousands, except per share data)

SUMMARY CONSOLIDATING BALANCE SHEETS:

	March 31, 2015
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Current assets:
Cash and cash equivalents	$	620			$	419			$	31,578			$	—			$	32,617
Trade and other receivables, net	3,578				180,874				337,149				—				521,601
Inventories	—				1,200,941				79,333				—				1,280,274
Rotable assets	—				35,248				13,572				—				48,820
Prepaid and other	6,509				10,549				6,011				—				23,069
Total current assets	10,707				1,428,031				467,643				—				1,906,381
Property and equipment, net	8,209				807,070				135,455				—				950,734
Goodwill and other intangible assets, net	—				2,786,400				204,811				—				2,991,211
Other, net	13,805				80,806				13,388				—				107,999
Intercompany investments and advances	4,062,058				81,540				63,897				(4,207,495		)		—
Total assets	$	4,094,779			$	5,183,847			$	885,194			$	(4,207,495	)		$	5,956,325
Current liabilities:
Current portion of long-term debt	$	19,024			$	23,231			$	—			$	—			$	42,255
Accounts payable	8,919				382,143				38,072				—				429,134
Accrued expenses	38,275				326,694				46,879				—				411,848
Total current liabilities	66,218				732,068				84,951				—				883,237
Long-term debt, less current portion	1,155,299				71,046				100,000				—				1,326,345
Intercompany debt	719,525				1,769,564				407,722				(2,896,811		)		—
Accrued pension and other postretirement benefits, noncurrent	7,517				527,741				3,123				—				538,381
Deferred income taxes and other	10,435				998,841				63,302				—				1,072,578
Total stockholders' equity	2,135,785				1,084,587				226,096				(1,310,684		)		2,135,784
Total liabilities and stockholders' equity	$	4,094,779			$	5,183,847			$	885,194			$	(4,207,495	)		$	5,956,325

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME:

	Fiscal year ended March 31, 2016
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Net sales	$	—			$	3,577,733			$	369,954			$	(61,615	)		$	3,886,072
Operating costs and expenses:
Cost of sales	—				3,343,038				315,876				(61,615		)		3,597,299
Selling, general and administrative	43,969				206,815				36,565				—				287,349
Depreciation and amortization	1,642				154,740				21,373				—				177,755
Impairment of intangible assets	—				874,361				—				—				874,361
Restructuring	10,347				25,835				—				—				36,182
Curtailments, settlements and early retirement incentives	(1,244		)		—				—				—				(1,244		)
Legal settlement charge, net	—				5,476				—				—				5,476
	54,714				4,610,265				373,814				(61,615		)		4,977,178
Operating loss	(54,714		)		(1,032,532		)		(3,860		)		—				(1,091,106		)
Intercompany interest and charges	(206,998		)		194,188				12,810				—				—
Interest expense and other	60,950				10,239				(3,148		)		—				68,041
Income (loss) from continuing operations, before income taxes	91,334				(1,236,959		)		(13,522		)		—				(1,159,147		)
Income tax expense (income)	17,161				(132,648		)		4,300				—				(111,187		)
Net income (loss)	74,173				(1,104,311		)		(17,822		)		—				(1,047,960		)
Other comprehensive (loss) income	(163		)		(136,024		)		(12,065		)		—				(148,252		)
Total comprehensive income (loss)	$	74,010			$	(1,240,335	)		$	(29,887	)		$	—			$	(1,196,212	)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME:

	Fiscal year ended March 31, 2015
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Net sales	$	—			$	3,592,062			$	320,907			$	(24,247	)		$	3,888,722
Operating costs and expenses:
Cost of sales	—				2,900,408				265,292				(24,247		)		3,141,453
Selling, general and administrative	50,562				199,569				35,642				—				285,773
Depreciation and amortization	2,269				141,561				14,493				—				158,323
Restructuring charge	—				3,193				—				—				3,193
Legal settlement gain, net	(134,693		)		—				—				—				(134,693		)
	(81,862		)		3,244,731				315,427				(24,247		)		3,454,049
Operating (loss) income	81,862				347,331				5,480				—				434,673
Intercompany interest and charges	(205,075		)		196,394				8,681				—				—
Interest expense and other	85,555				10,438				(10,614		)		—				85,379
Income from continuing operations, before income taxes	201,382				140,499				7,413				—				349,294
Income tax expense (benefit)	58,049				54,359				(1,811		)		—				110,597
Net income	143,333				86,140				9,224				—				238,697
Other comprehensive (loss)	(4,253		)		(128,800		)		(46,949		)		—				(180,002		)
Total comprehensive income (loss)	$	139,080			$	(42,660	)		$	(37,725	)		$	—			$	58,695

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TRIUMPH GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME:

	Fiscal year ended March 31, 2014
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Net sales	$	—			$	3,569,094			$	197,987			$	(3,827	)		$	3,763,254
Operating costs and expenses:
Cost of sales	—				2,760,627				155,002				(3,827		)		2,911,802
Selling, general and administrative	36,670				192,422				25,623				—				254,715
Depreciation and amortization	2,782				152,593				8,902				—				164,277
Restructuring charge	—				31,290				—				—				31,290
Curtailments, settlements and early retirement incentives	1,166				—				—				—				1,166
	40,618				3,136,932				189,527				(3,827		)		3,363,250
Operating (loss) income	(40,618		)		432,162				8,460				—				400,004
Intercompany interest and charges	(215,079		)		207,397				7,682				—				—
Interest expense and other	86,094				6,103				(4,426		)		—				87,771
Income from continuing operations, before income taxes	88,367				218,662				5,204				—				312,233
Income tax expense	20,478				85,061				438				—				105,977
Net income	67,889				133,601				4,766				—				206,256
Other comprehensive income (loss)	1,481				43,898				(3,315		)		—				42,064
Total comprehensive income	$	69,370			$	177,499			$	1,451			$	—			$	248,320

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS:

	Fiscal year ended March 31, 2016
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Net income (loss)	$	74,173			$	(1,104,311	)		$	(17,822	)		$	—			$	(1,047,960	)
Adjustments to reconcile net income to net cash (used in) provided by operating activities	(106,837		)		1,207,850				24,629				6,181				1,131,823
Net cash (used in) provided by operating activities	(32,664		)		103,539				6,807				6,181				83,863
Capital expenditures	(986		)		(57,503		)		(21,558		)		—				(80,047		)
Proceeds from sale of assets and businesses	—				5,877				192				—				6,069
Cash used for businesses and intangible assets acquired	—				(48,051		)		(6,000		)		—				(54,051		)
Net cash used in investing activities	(986		)		(99,677		)		(27,366		)		—				(128,029		)
Net increase in revolving credit facility	(8,256		)		—				—				—				(8,256		)
Proceeds on issuance of debt	—				6,497				128,300				—				134,797
Retirements and repayments of debt	(19,024		)		(24,893		)		(37,000		)		—				(80,917		)
Payments of deferred financing costs	(185		)		—				—				—				(185		)
Dividends paid	(7,889		)		—				—				—				(7,889		)
Repayment of governmental grant	—				(5,000		)		—				—				(5,000		)
Repurchase of restricted shares for minimum tax obligation	(96		)		—				—				—				(96		)
Intercompany financing and advances	70,024				19,316				(83,159		)		(6,181		)		—
Net cash provided by (used in) financing activities	34,574				(4,080		)		8,141				(6,181		)		32,454
Effect of exchange rate changes on cash and cash equivalents	—				—				79				—				79
Net change in cash and cash equivalents	924				(218		)		(12,339		)		—				(11,633		)
Cash and cash equivalents at beginning of year	620				419				31,578				—				32,617
Cash and cash equivalents at end of year	$	1,544			$	201			$	19,239			$	—			$	20,984

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS:

	Fiscal year ended March 31, 2015
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Net income	$	143,333			$	86,140			$	9,224			$	—			$	238,697
Adjustments to reconcile net income to net cash (used by)provided by operating activities	(154,295		)		397,607				(25,590		)		10,913				228,635
Net cash (used in) provided by operating activities	(10,962		)		483,747				(16,366		)		10,913				467,332
Capital expenditures	(905		)		(92,686		)		(16,413		)		—				(110,004		)
Reimbursements of capital expenditures	—				653				—				—				653
Proceeds from sale of assets and businesses	—				3,092				75				—				3,167
Cash used for businesses and intangible assets acquired	—				112,110				(73,829		)		—				38,281
Net cash (used in) provided by investing activities	(905		)		23,169				(90,167		)		—				(67,903		)
Net increase in revolving credit facility	(46,150		)		—				—				—				(46,150		)
Proceeds on issuance of debt	300,000				37,660				171,300				—				508,960
Retirements and repayments of debt	(401,232		)		(20,928		)		(233,700		)		—				(655,860		)
Purchase of common stock	(184,380		)		—				—				—				(184,380		)
Payments of deferred financing costs	(6,487		)		—				—				—				(6,487		)
Dividends paid	(8,100		)		—				—				—				(8,100		)
Repayment of governmental grant	—				(3,198		)		—				—				(3,198		)
Repurchase of restricted shares for minimum tax obligation	(673		)		—				—				—				(673		)
Proceeds from exercise of stock options, including excess tax benefit	720				—				—				—				720
Intercompany financing and advances	355,969				(521,180		)		176,124				(10,913		)		—
Net cash provided by (used in) financing activities	9,667				(507,646		)		113,724				(10,913		)		(395,168		)
Effect of exchange rate changes on cash and cash equivalents	—				—				(642		)		—				(642		)
Net change in cash and cash equivalents	(2,200		)		(730		)		6,549				—				3,619
Cash and cash equivalents at beginning of year	2,820				1,149				25,029				—				28,998
Cash and cash equivalents at end of year	$	620			$	419			$	31,578			$	—			$	32,617

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS:

	Fiscal year ended March 31, 2014
	Parent				Guarantor Subsidiaries				Non-Guarantor Subsidiaries				Eliminations				Consolidated Total
Net income	$	67,889			$	133,601			$	4,766			$	—			$	206,256
Adjustments to reconcile net income to net cash provided by operating activities	108,816				(170,631		)		(3,502		)		(5,802		)		(71,119		)
Net cash provided by (used in) operating activities	176,705				(37,030		)		1,264				(5,802		)		135,137
Capital expenditures	(2,381		)		(185,794		)		(18,239		)		—				(206,414		)
Reimbursements of capital expenditures	—				9,086				—				—				9,086
Proceeds from sale of assets and businesses	—				45,038				9				—				45,047
Cash used for businesses and intangible assets acquired	—				(6,505		)		(87,951		)		—				(94,456		)
Net cash used in investing activities	(2,381		)		(138,175		)		(106,181		)		—				(246,737		)
Net increase in revolving credit facility	98,557				—				—				—				98,557
Proceeds on issuance of debt	375,000				30,503				45,500				—				451,003
Retirements and repayments of debt	(271,812		)		(27,218		)		(117,615		)		—				(416,645		)
Purchase of common stock	(19,134		)		—				—				—				(19,134		)
Payments of deferred financing costs	(3,297		)		—				—				—				(3,297		)
Dividends paid	(8,344		)		—				—				—				(8,344		)
Proceeds from governmental grant	—				3,456				—				—				3,456
Repurchase of restricted shares for minimum tax obligation	(2,726		)		—				—				—				(2,726		)
Proceeds from exercise of stock options, including excess tax benefit	329				—				—				—				329
Intercompany financing and advances	(343,187		)		168,076				169,309				5,802				—
Net cash (used in) provided by financing activities	(174,614		)		174,817				97,194				5,802				103,199
Effect of exchange rate changes on cash and cash equivalents	—				—				5,362				—				5,362
Net change in cash and cash equivalents	(290		)		(388		)		(2,361		)		—				(3,039		)
Cash and cash equivalents at beginning of year	3,110				1,537				27,390				—				32,037
Cash and cash equivalents at end of year	$	2,820			$	1,149			$	25,029			$	—			$	28,998

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Dollars in thousands, except per share data)

*
23.	QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

	Fiscal 2016																Fiscal 2015
	June 30				Sept. 30				Dec. 31 (7)				Mar. 31 (8)				June 30 (3) (4)				Sept. 30				Dec. 31 (5) (6)				Mar. 31
BUSINESS SEGMENT SALES
Aerostructures	$	611,838			$	604,874			$	553,627			$	657,470			$	612,160			$	632,510			$	560,346			$	705,355
Aerospace Systems	277,647				280,155				288,288				320,705				219,852				288,902				279,198				301,165
Aftermarket Services	74,745				73,777				78,127				84,745				67,608				74,343				80,690				81,372
Inter-segment Elimination	(4,592		)		(4,032		)		(6,176		)		(5,126		)		(2,715		)		(1,632		)		(2,817		)		(7,615		)
TOTAL SALES	$	959,638			$	954,774			$	913,866			$	1,057,794			$	896,905			$	994,123			$	917,417			$	1,080,277
GROSS PROFIT (1)	$	201,732			$	197,742			$	195,405			$	(420,767	)		$	188,112			$	197,566			$	24,068			$	237,071
OPERATING INCOME
Aerostructures	$	66,007			$	67,099			$	(187,265	)		$	(1,220,618	)		$	68,819			$	70,008			$	(104,231	)		$	86,389
Aerospace Systems	51,253				46,140				52,754				66,373				37,352				46,214				41,863				58,613
Aftermarket Services	9,987				9,125				12,402				(6,537		)		10,504				11,620				12,490				13,317
Corporate	(19,381		)		(12,317		)		(4,141		)		(21,987		)		123,849				(13,144		)		(11,388		)		(17,602		)
TOTAL OPERATING INCOME	$	107,866			$	110,047			$	(126,250	)		$	(1,182,769	)		$	240,524			$	114,698			(61,266		)		$	140,717
NET INCOME	$	62,732			$	61,612			$	(88,649	)		$	(1,083,655	)		$	128,243			$	67,446			(39,832		)		$	82,840
Basic Earnings (Loss) per share	$	1.28			$	1.25			$	(1.80	)		$	(22.01	)		$	2.48			$	1.32			$	(0.79	)		$	1.66
Diluted Earnings (Loss) per share (2)	$	1.27			$	1.25			$	(1.80	)		$	(22.01	)		$	2.46			$	1.32			$	(0.79	)		$	1.66

*	Difference due to rounding.

(1)	Gross profit includes depreciation.

(2)	The sum of the diluted earnings per share for the four quarters does not necessarily equal the total year diluted earnings per share due to the dilutive effect of the potential common shares related to the convertible debt.

(2)
(3)	Includes the results of GE from June 27, 2014 (date of acquisition) through March 31, 2015.

(4)	Includes the Gain on Legal Settlement, net ($134,693).

(5)	Includes the results of NAAS from October 17, 2014 (date of acquisition) through March 31, 2015.

(6)	Includes the results of Tulsa Programs from December 30, 2014 (date of acquisition) through March 31, 2015, and a provision for forward losses of approximately $151,992 associated with our long-term contract on the 747-8 program.

(7)	Includes the results of Fairchild from October 21, 2015 (date of acquisition) through March 31, 2016 and impairment of intangible assets of $229,200.

(8)	Includes impairment of intangible assetsgoodwill of $645,161, forward losses on the Bombardier and 747-8 programs of $561,158 and restructuring of $80,956.$66,121 in Systems & Support.

TRIUMPH GROUP, INC.

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

(Dollars in thousands)

		Balance at beginning of year				Additions charged to (income) expense				Other (1)				Balance at end of year
For year ended March 31, 2020:
Deferred tax assets valuation allowance		$	399,013				(3,474	)			43,128			$	438,667
For year ended March 31, 2019:
Deferred tax assets valuation allowance		$	146,770				93,311				158,932			$	399,013
For year ended March 31, 2018:
Deferred tax assets valuation allowance		$	141,214				6,885				(1,329	)		$	146,770

		Balance at beginning of year				Additions charged to expense			Additions(1)			(Deductions)(2)			Balance at end of year
For year ended March 31, 2016:
Allowance for doubtful accounts receivable		$	6,475			2,028			(47	)		(1,964	)		$	6,492
For year ended March 31, 2015:
Allowance for doubtful accounts receivable		$	6,535			171			85			(316	)		$	6,475
For year ended March 31, 2014:
Allowance for doubtful accounts receivable		$	5,372			2,191			6			(1,034	)		$	6,535

(1)
(1)	Additions consist of trade Adjustments relate to changes in defined benefit pension plan and other receivable recoveries and miscellaneous adjustments.postretirement benefit plan obligations.  The adjustment in the year ended March 31, 2019, also included an adjustment of approximately $132,000 as a result of the adoption of ASC 606.

(2)	Deductions represent write-offs of related account balances.

Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Item 9.  Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

None.

Item 9A.	Controls and Procedures

Item 9A.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As of March 31, 2016,2020, we completed an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of March 31, 2016.

2020.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of Triumph Group, Inc. ("Triumph") is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Triumph's internal control system over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Company's internal control over financial reporting includes those policies and procedures that:

(i)	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii)	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

(iii)	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.

Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in condition, or that the degree of compliance with the policies or procedures may deteriorate.

Triumph's management assessed the effectiveness of Triumph's internal control over financial reporting as of March 31, 2016.2020. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) ("COSO") in Internal Control—Integrated Framework. Based on management's assessment and those criteria, management believes that Triumph maintained effective internal control over financial reporting as of March 31, 2016.

Management's assessment of and conclusion on the effectiveness of Triumph's internal control over financial reporting did not include the internal controls of Triumph Thermal Systems - Maryland, which was acquired in the fiscal year ended March 31, 2016. The acquisition, which is more fully discussed in Note 3 to the consolidated financial statements for fiscal 2016, is included in the fiscal 2016 consolidated financial statements of Triumph Group, Inc. and represented total assets of approximately $61 million or 1% at March 31, 2016, and revenues of approximately $18 million or 0.5% for the year ended March 31, 2016. Under guidelines established by the SEC, companies are allowed to exclude acquisitions from their first assessment of internal control over financial reporting following the date of acquisition.

2020.

Triumph's independent registered public accounting firm, Ernst & Young LLP, has audited Triumph's effectiveness of Triumph's internal control over financial reporting. This report appears on the following page.

/s/ Daniel J. Crowley
Daniel J. Crowley President, Chief Executive Officer and Director
/s/ Jeffrey L. McRaeJames F. McCabe, Jr.
Jeffrey L. McRae James F. McCabe, Jr. Senior Vice President and Chief Financial Officer
/s/ Thomas A. Quigley, III
Thomas A. Quigley, III Vice President and Controller

May 27, 2016

28, 2020

Report of Independent Registered Public Accounting Firm

The

To the Board of Directors and Stockholders of Triumph Group, Inc.

Opinion on Internal Control Over Financial Reporting

We have audited Triumph Group, Inc.'s’s internal control over financial reporting as of March 31, 2016,2020, based on criteria established in Internal Control—IntegratedControl-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) ("the COSO criteria"(the “COSO criteria”). In our opinion, Triumph Group, Inc.'s (the “Company”) maintained, in all material respects, effective internal control over financial reporting as of March 31, 2020, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the consolidated balance sheets of Triumph Group, Inc. as of March 31, 2020 and 2019, the related consolidated statements of operations, comprehensive loss, stockholders’ (deficit) equity and cash flows for each of the three years in the period ended March 31, 2020, and the related notes and financial statement schedule listed in the Index at Item 15(a) and our report dated May 28, 2020, expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management'sManagement’s Report on Internal Control Over Financial Reporting.Reporting. Our responsibility is to express an opinion on the Company'sCompany’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company'scompany’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company'scompany’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company'scompany’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As indicated in the accompanying Management's Report on Internal Control Over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Triumph Thermal Systems - Maryland, which is included in the fiscal year 2016 consolidated financial statements of Triumph Group, Inc. and constituted $61 million and $0.1 million of total and net assets, respectively, as of March 31, 2016, and $18 million and $0.1 million of revenues and net loss, respectively, for the year then ended. Our audit of internal control over financial reporting of Triumph Group, Inc. also did not include an evaluation of the internal control over financial reporting of Triumph Thermal Systems - Maryland.

In our opinion, Triumph Group, Inc. maintained, in all material respects, effective internal control over financial reporting as of March 31, 2016, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Triumph Group, Inc., as of March 31, 2016 and 2015, and the related consolidated statements of operations, comprehensive (loss) income, stockholders' equity, and cash flows for each of the three years in the period ended March 31, 2016, of Triumph Group, Inc. and our report dated May 27, 2016, expressed an unqualified opinion thereon.

	/s/ Ernst & Young LLP

Philadelphia, Pennsylvania

May 28, 2020

Philadelphia, Pennsylvania

May 27, 2016

Changes in Internal Control Over Financial Reporting

In addition to management's evaluation of disclosure controls and procedures as discussed above, we continue to review and enhance our policies and procedures for internal control over financial reporting.

We have developed and implemented a formal set of internal controls and procedures for financial reporting in accordance with the SEC's rules regarding management's report on internal controls. As a result of continued review and testing by management and by our internal and independent auditors, or as a result of newly adopted accounting standards, additional changes may be made to our internal controls and procedures. However, we did not make any changes to our internal control over financial reporting in the fourth quarter of fiscal 20162020 that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

Item 9B.	Other Information

Item 9B.  Other Information

None.

86

---

PART III

Item 10.	Directors, Executive Officers and Corporate Governance

Item 10.  Directors, Executive Officers and Corporate Governance

The information required for directors and executive officers is incorporated herein by reference to our definitive 2020 Proxy Statement for our 20162020 Annual Meeting of Stockholders, which shall be filed within 120 days after the end of our fiscal year (the "2016 Proxy Statement"). Information required by this item concerning executive officers is included in Part I of this Annual Report on Form 10-K.

Stockholders.

Delinquent Section 16(a) Beneficial Ownership Reporting Compliance

Reports

The information required regarding Section 16(a) beneficial ownership reporting compliance is incorporated herein by reference to the 20162020 Proxy Statement.

Code of Business Conduct

The information required regarding our Code of Business Conduct is incorporated herein by reference to the 20162020 Proxy Statement.

Stockholder Nominations

The information required with respect to any material changes to the procedures by which stockholders may recommend nominees to the Company's board of directors is incorporated herein by reference to the 20162020 Proxy Statement.

Audit Committee and Audit Committee Financial Expert

The information required with respect to the Audit Committee and Audit Committee financial experts is incorporated herein by reference to the 20162020 Proxy Statement.

Item 11.	Executive Compensation

The information required regarding executive compensation is incorporated herein by reference to the 2016 Proxy Statement.

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 11.  Executive Compensation

The information required under this item is incorporated herein by reference to the 20162020 Proxy Statement.

Item 13.	Certain Relationships and Related Transactions and Director Independence

Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required under this item is incorporated herein by reference to the 20162020 Proxy Statement.

Item 14.	Principal Accountant Fees and Services

Item 13.  Certain Relationships and Related Transactions and Director Independence

The information required under this item is incorporated herein by reference to the 20162020 Proxy Statement.

Item 14.  Principal Accountant Fees and Services

The information required under this item is incorporated herein by reference to the 2020 Proxy Statement.

PART IV

Item 15.  Exhibits, Financial Statement Schedules

(a) Financial Statements

(1) The following consolidated financial statements are included in Item 8 of this report:

Triumph Group, Inc.	Page
Report of Ernst & Young LLP, Independent Registered Public Accounting Firm	49
Consolidated Balance Sheets as of March 31, 20162020 and 20152019	50 44
Consolidated StatementStatements of Operations for the Fiscal Years Ended March 31, 2016, 20152020, 2019, and 20142018	51 45
Consolidated StatementStatements of Comprehensive (Loss) IncomeLoss for the Fiscal Years Ended March 31, 2016, 20152020, 2019, and 20142018	52 46
Consolidated Statements of Stockholders' (Deficit) Equity for the Fiscal Years Ended March 31, 2016, 20152020, 2019, and 20142018	53 47
Consolidated Statements of Cash Flows for the Fiscal Years Ended March 31, 2016, 20152020, 2019, and 20142018	54 48
Notes to Consolidated Financial Statements	49
55Report of Ernst & Young LLP, Independent Registered Public Accounting Firm	85

(2) The following financial statement schedule is included in this report:

	Page
	Page
Schedule II—Valuation and Qualifying Accounts	107 82

All other schedules have been omitted as not applicable or because the information is included elsewhere in the Consolidated Financial Statements or notes thereto.

(3) The following is a list of exhibits. Where so indicated, by footnote, exhibits which were previously filed are incorporated by reference.

Exhibit Number	Exhibit Description	Incorporated by Reference to
		Form	File No.	Exhibit(s)	Filing Date
3.1	Amended and Restated Certificate of Incorporation of Triumph Group, Inc.	10-K	001-12235	3.1	May 22, 2009
3.2	Certificate of Amendment of Amended and Restated Certificate of Incorporation of Triumph Group, Inc.	8-K	001-12235	3.1	July 20, 2012
3.3	Form of Certificate of Designations, Preferences and Rights of Series B Junior Participating Preferred Stock	8-K	001-12235	3.1	March 13, 2019
3.4	Certificate of Amendment to Amended and Restated Certificate of Incorporation of Triumph Group, Inc.	8-K/A	001-12235	3.1	August 5, 2019
3.5	Amended and Restated By-Laws of Triumph Group, Inc.	8-K	001-12235	3.1	April 26, 2019
4.1	Form of Certificate evidencing Common Stock of Triumph Group, Inc.	8-K	001-12235	4.2	March 13, 2019
4.2	Indenture, dated as of February 26, 2013, between Triumph Group, Inc. and U.S. Bank National Association, as trustee	8-K	001-12235	4.1	March 1, 2013
4.2.1	Form of 4.875% Senior Subordinated Notes due 2021(included as Exhibit A to Exhibit 4.1)	8-K	001-12235	4.2	March 1, 2013
4.3	Indenture, dated as of June 3, 2014, between Triumph Group, Inc. and U.S. Bank National Association, as trustee	8-K	001-12235	4.1	June 5, 2014
4.3.1	Form of 5.250% Senior Notes due 2022 (included as Exhibit A to the Indenture filed as Exhibit 4.1)	8-K	001-12235	4.2	June 5, 2014
4.4	Second Supplemental Indenture dated as of May 18, 2016 by and among Triumph Group, Inc., the guarantors signatory thereto and U.S. Bank National Association, as trustee, relating to the 4.875% Senior Notes due 2021	10-K	001-12235	4.12	May 27, 2016
4.5	Indenture, dated as of August 17, 2017, between Triumph Group, Inc. and U.S. Bank National Association, as trustee	8-K	001-12235	4.1	August 18, 2017
4.6	Form of 7.750% Senior Notes due 2025 (included as Exhibit A to the Indenture filed as Exhibit 4.1).	8-K	001-12235	4.2	August 18, 2017
4.7	Indenture, dated as of September 23, 2019, between Triumph Group, Inc., the subsidiary guarantors signatory thereto and U.S. Bank National Association, as trustee.	10-Q	001-12235	4.1	November 7, 2019
4.8	Form of 6.250% Senior Secured Notes due 2024 (included as Exhibit A to the Indenture filed as Exhibit 4.1).	10-Q	001-12235	4.1	November 7, 2019
4.9	Tax Benefits Preservation Plan, dated as of March 13, 2019, between Triumph Group, Inc. and Computershare Trust Company, N.A.	8-K	001-12235	4.3	March 13, 2019

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
2.1		Agreement and Plan of Merger, dated as of March 23, 2010, by and among Triumph Group, Inc., Vought Aircraft Industries, Inc., Spitfire Merger Corporation and TC Group, L.L.C., as the Holder Representative		8-K	001-12235	2.1	March 23, 2010
3.1		Amended and Restated Certificate of Incorporation of Triumph Group, Inc.		10-K	001-12235	3.1	May 22, 2009
3.1.1		Certificate of Amendment of Amended and Restated Certificate of Incorporation of Triumph Group, Inc.		8-K	001-12235	3.1	July 20, 2012
3.2		Amended and Restated By-Laws of Triumph Group, Inc.		8-K/A	001-12235	3.2	August 2, 2012
4.1		Form of certificate evidencing Common Stock of Triumph Group, Inc.		S-1	333-10777	4	August 23, 1996
4.2		Indenture, dated as of September 18, 2006, between Triumph Group, Inc. and The Bank of New York Trust Company, N.A. relating to the 2.625% Convertible Senior Subordinated Notes Due 2026		8-K	001-12235	4.1	September 22, 2006
4.2.1		Form of the 2.625% Convertible Senior Subordinated Note Due 2026 (included as Exhibit A to Exhibit 4.1)		8-K	001-12235	4.2	September 22, 2006
4.3		Registration Rights Agreement, dated as of September 18, 2006, between Triumph Group, Inc. and Banc of America Securities LLC		8-K	001-12235	4.3	September 22, 2006

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
4.4		Indenture, dated as of November 16, 2009, between Triumph Group, Inc. and U.S. Bank National Association, as trustee, relating to the 8% Senior Subordinated Notes due 2017.		8-K	001-12235	4.1	November 19, 2009
4.4.1		Form of 8% Senior Subordinated Notes due 2017 (included as Exhibit A to Indenture filed as Exhibit 4.1)		8-K	001-12235	4.2	November 19, 2009
4.5		Registration Rights Agreement, dated November 16, 2009, by and among Triumph Group, Inc., the Guarantors party thereto, and the other parties thereto.		8-K	001-12235	4.3	November 19, 2009
4.6		Indenture, dated as of June 16, 2010, between Triumph Group, Inc. and U.S. Bank National Association, as trustee, relating to the 8.625% Senior Subordinated Notes Due 2018		8-K	001-12235	4.1	June 22, 2010
4.7		Registration Rights Agreement, dated as of June 16, 2010, by and among Triumph Group, Inc., the Guarantors party thereto and the other parties thereto		8-K	001-12235	4.3	June 22, 2010
4.8		Indenture, dated as of February 26, 2013, between Triumph Group, Inc. and U.S. Bank National Association, as trustee		8-K	001-12235	4.1	March 1, 2013
4.8.1		Form of 4.875% Senior Subordinated Notes due 2021(included as Exhibit A to Exhibit 4.1)		8-K	001-12235	4.2	March 1, 2013
4.9		Registration Rights Agreement, dated February 26, 2013 between Triumph Group, Inc. and the parties named therein		8-K	001-12235	4.3	March 1, 2013
4.10		Indenture, dated as of June 3, 2014, between Triumph Group, Inc. and U.S. Bank National Association, as trustee		8-K	001-12235	4.1	June 5, 2014
4.10.1		Form of 5.250% Senior Notes due 2022 (included as Exhibit A to the Indenture filed as Exhibit 4.1)		8-K	001-12235	4.2	June 5, 2014
4.11		Registration Rights Agreement, dated June 3, 2014, between Triumph Group, Inc. and parties named therein		8-K	001-12235	4.3	June 5, 2014
4.12		Second Supplemental Indenture dated as of May 18, 2016 by and among Triumph Group, Inc., the guarantors signatory thereto and U.S. Bank National Association, as trustee, relating to the 4.875% Senior Notes due 2021		#	#	#	#
10.1		Amended and Restated Directors’ Stock Incentive Plan		10-K	001-12235	10.1	May 29, 2012
10.1.1		Form of Deferred Stock Unit Award Agreement under the Amended and Restated Directors’ Stock Incentive Plan		10-K	001-12235	10.2	May 30, 2013
10.2		Triumph Group, Inc. 2004 Stock Incentive Plan*		10-K	001-12235	10.3	May 30, 2013
10.2.1		Form of Stock Award Agreement under the 2004 Stock Incentive Plan*		10-K	001-12235	10.7	May 22, 2009
10.2.2		Form of letter confirming Stock Award Agreement under the 2004 Stock Incentive Plan*		10-K	001-12235	10.8	May 22, 2009
10.3		Triumph Group, Inc. Supplemental Executive Retirement Plan effective January 1, 2003*		10-K	001-12235	10.17	June 12, 2003

Exhibit Number	Exhibit Description	Incorporated by Reference to
		Form	File No.	Exhibit(s)	Filing Date
4.10	Description of Securities	10-K	001-12235	4.8	May 23, 2019
10.1	Amended and Restated Directors’ Stock Incentive Plan	10-K	001-12235	10.1	May 29, 2012
10.1.1	Form of Deferred Stock Unit Award Agreement under the Amended and Restated Directors’ Stock Incentive Plan	10-K	001-12235	10.2	May 30, 2013
10.2	Triumph Group, Inc. 2004 Stock Incentive Plan*	10-K	001-12235	10.3	May 30, 2013
10.2.1	Form of Stock Award Agreement under the 2004 Stock Incentive Plan*	10-K	001-12235	10.7	May 22, 2009
10.2.2	Form of letter confirming Stock Award Agreement under the 2004 Stock Incentive Plan*	10-K	001-12235	10.8	May 22, 2009
10.3	Triumph Group, Inc. Supplemental Executive Retirement Plan effective January 1, 2003*	10-K	001-12235	10.17	June 12, 2003
10.4	Compensation for the non-employee members of the Board of Directors of Triumph Group, Inc.	8-K	001-12235	10.1	November 15, 2016
10.6	Form of Receivables Purchase Agreement, dated August 7, 2008, by and among the Triumph Group, Inc., as Initial Servicer, Triumph Receivables, LLC, as Seller, the various Purchasers and Purchase Agents from time to time party thereto and PNC National Association, as Administrative Agent.	8-K	001-12235	10.1	August 12, 2008
10.7	Third Amendment to Receivables Purchase Agreement, dated as of June 21, 2010, by and among Triumph Receivables LLC, Triumph Group, Inc., Market Street Funding LLC and PNC Bank, National Association	8-K	001-12235	10.1	June 25, 2010
10.8	Triumph Group, Inc. Executive Incentive Plan, effective September 28, 2010 *	10-Q	001-12235	10.1	November 5, 2010
10.9	Form of letter informing Triumph Group, Inc. executives they are eligible to participate in the Company’s Long Term Incentive Plan *	10-K	001-12235	10.22	May 18, 2011
10.10	Form of letter informing Triumph Group, Inc. executives they have earned an award under the Company’s Long Term Incentive Plan and the amount of the award *	10-K	001-12235	10.23	May 18, 2011
10.11	Sixth Amendment to Receivables Purchase Agreement, dated as of February 26, 2013, by and among Triumph Receivables LLC, Triumph Group, Inc., Market Street Funding LLC and PNC Bank, National Association	8-K	001-12235	10.1	March 1, 2013
10.12	Form of Third Amended and Restated Credit Agreement, dated as of November 19, 2013, by and among Triumph Group, Inc., and the other Borrowers party thereto and the Guarantors party thereto and the Banks party thereto and PNC Bank, National Association, as Administrative Agent, PNC Capital Markets LLC, J.P. Morgan Securities, LLC, RBC Capital Markets, RBS Citizens, N.A., and Santander Bank, N.A., as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank N.A., Royal Bank of Canada, Citizens Bank of Pennsylvania, and Santander Bank, N.A., as Syndication Agents, the Bank of Tokyo-Mitsubishi UFJ, Ltd, U.S. Bank National Association, TD Bank, N.A., and Manufacturers and Traders Trust Company, as Documentation Agents	8-K	001-12235	10.1	November 25, 2013
10.13	Form of Second Amended and Restated Guarantee and Collateral Agreement made by Triumph Group, Inc., and certain of its Subsidiaries in favor of PNC Bank, National Association, as Administrative Agent and as Collateral Agent for the other Secured Parties identified herein, dated as of November 19, 2013	8-K	001-12235	10.2	November 25, 2013
10.14	Triumph Group, Inc. 2013 Equity and Cash Incentive Plan, as amended and restated as of June 7, 2017*	8-K	001-12235	99.1	June 12, 2017
10.15	Form of letter regarding eligibility to participate in the Triumph Group, Inc. Restricted Stock Plan*	10-K	001-12235	10.24	May 19, 2014
10.16	Tenth Amendment to Receivables Purchase Agreement dated as of November 25, 2014	8-K	001-12235	10.1	November 26, 2014

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
10.4		Compensation for the non-employee members of the Board of Directors of Triumph Group, Inc.		10-K	001-12235	10.6	May 30, 2013
10.5		Description of the Triumph Group, Inc. Annual Cash Bonus Plan*		8-K	001-12235	10.1	July 31, 2007
10.6		Change of Control Employment Agreements with: Richard C. Ill and John B. Wright, II.		8-K	001-12235	10.1 and 10.3	March 13, 2008
10.7		Form of Receivables Purchase Agreement, dated August 7, 2008, by and among the Triumph Group, Inc., as Initial Servicer, Triumph Receivables, LLC, as Seller, the various Purchasers and Purchase Agents from time to time party thereto and PNC National Association, as Administrative Agent.		8-K	001-12235	10.1	August 12, 2008
10.8		Stockholders Agreement, dated as of March 23, 2010, among Triumph Group, Inc., Carlyle Partners III, L.P., Carlyle Partners II, L.P., Carlyle International Partners II, L.P., Carlyle-Aerostructures Partners, L.P., CHYP Holdings, L.L.C., Carlyle-Aerostructures Partners II, L.P., CP III Coinvestment, L.P., C/S International Partners, Carlyle-Aerostructures International Partners, L.P., Carlyle-Contour Partners, L.P., Carlyle SBC Partners II, L.P., Carlyle International Partners III, L.P., Carlyle-Aerostructures Management, L.P., Carlyle-Contour International Partners, L.P., Carlyle Investment Group, L.P. and TC Group, L.L.C		8-K	001-12235	10.1	March 23, 2010
10.9		Third Amendment to Receivables Purchase Agreement, dated as of June 21, 2010, by and among Triumph Receivables LLC, Triumph Group, Inc., Market Street Funding LLC and PNC Bank, National Association		8-K	001-12235	10.1	June 25, 2010
10.10		Triumph Group, Inc. Executive Incentive Plan, effective September 28, 2010 *		10-Q	001-12235	10.1	November 5, 2010
10.11		Form of letter informing Triumph Group, Inc. executives they are eligible to participate in the Company’s Long Term Incentive Plan *		10-K	001-12235	10.22	May 18, 2011
10.12		Form of letter informing Triumph Group, Inc. executives they have earned an award under the Company’s Long Term Incentive Plan and the amount of the award *		10-K	001-12235	10.23	May 18, 2011
10.13		Sixth Amendment to Receivables Purchase Agreement, dated as of February 26, 2013, by and among Triumph Receivables LLC, Triumph Group, Inc., Market Street Funding LLC and PNC Bank, National Association		8-K	001-12235	10.1	March 1, 2013

Exhibit Number	Exhibit Description	Incorporated by Reference to
		Form	File No.	Exhibit(s)	Filing Date
10.17	Third Amendment to Third Amended and Restated Credit Agreement, dated as of February 3, 2015, by and among Triumph Group, Inc. and the other Borrowers party thereto and the Guarantors party thereto and the Banks party thereto and PNC Bank, National Association, as Administrative Agent	10-Q	001-12235	10.1	February 9, 2015
10.18	The First Amendment of the Triumph Group, Inc. Supplemental Executive Retirement Plan, effective as of May 1, 2015 *	8-K	001-12235	10.1	May 7, 2015
10.19	First Amendment to Triumph Group, Inc. 2013 Employee Stock Purchase Plan *	10-Q	001-12235	10.1	August 4, 2015
10.20	Employment Agreement between Triumph Group, Inc. and Daniel J. Crowley, dated as of April 1, 2016*	8-K	001-12235	10.1	April 7, 2016
10.21	Form of Sixth Amendment to Third Amended and Restated Credit Agreement, dated May 3, 2016	8-K	001-12235	10.1	May 4, 2016
10.22	Employment letter between Triumph Group, Inc. and James F. McCabe dated July 26, 2016 *	8-K	001-12235	10.1	July 27, 2016
10.23	Form of Seventh Amendment to Third Amended and Restated Credit Agreement, dated October 21, 2016	10-Q	001-12235	10.1	November 9, 2016
10.24	Triumph Group, Inc. Directors' Deferred Compensation Plan, effective January 1, 2017	8-K	001-12235	10.2	November 15, 2016
10.25	Eighth Amendment to the Third Amended and Restated Credit Agreement, dated May 1, 2017	8-K	001-12235	10.1	May 10, 2017
10.26	Form of the 2016 Directors' Equity Compensation Plan, as amended	10-K/A	001-12235	10.34	May 26, 2017
10.27	Form of Restricted Stock Unit Agreement under the 2016 Directors' Equity Compensation Plan, as amended	10-K/A	001-12235	10.35	May 26, 2017
10.28	Triumph Group, Inc. Directors' Deferred Compensation Plan, effective January 1, 2017	8-K	001-12235	10.2	November 15, 2016
10.29	Twentieth Amendment to Receivables Purchase Agreement dated as of November 3, 2017	8-K	001-12235	10.1	November 7, 2017
10.30	Ninth Amendment to the Third Amended and Restated Credit Agreement, dated July 31, 2017	10-Q	001-12235	10.1	November 8, 2017
10.31	Employment Letter between Triumph Group, Inc. and Peter Wick dated January 20, 2018 *	10-Q	001-12235	10.1	February 7, 2018
10.32	Triumph Group, Inc. 2018 Equity Incentive Plan, effective May 29, 2018*	8-K	001-12235	10.1	June 4, 2018
10.32.1	Amendment to Triumph Group, Inc. 2018 Equity Incentive Plan, effective February 19, 2018*	10-K	001-12235	10.32.1	May 23, 2019
10.32.2	Form of Long-Term Incentive Award Letter under the 2018 Equity Incentive Plan*	10-K	001-12235	10.32.2	May 23, 2019
10.33	Triumph Group, Inc. 2018 Executive Cash Incentive Compensation Plan, effective April 1, 2018*	8-K	001-12235	10.2	June 4, 2018
10.33.1	Form of Short-Term Cash Incentive Award Letter under the 2018 Executive Cash Incentive Compensation Plan*	10-K	001-12235	10.33.1	May 23, 2019
10.34	Tenth Amendment to the Third Amended and Restated Credit Agreement, dated July 19, 2018	8-K	001-12235	10.1	July 20, 2018
10.35	Separation Agreement Triumph Group, Inc. and John B. Wright, dated January 7, 2019*	8-K/A	001-12235	10.1	January 25, 2019
10.36	Separation Agreement Triumph Group, Inc. and Michael Abram, dated January 7, 2019*	8-K/A	001-12235	10.2	January 25, 2019
10.37	Separation Agreement between Triumph Group, Inc. and Thomas Holzthum, dated February 15, 2019*	8-K/A	001-12235	10.1	February 22, 2019
10.38	Employment Letter between Triumph Group, Inc. and Lance Turner, dated September 5, 2017*	10-K	001-12235	10.33.1	May 23, 2019
10.39	Employment Letter between Triumph Group, Inc. and Daniel Ostrosky, dated March 25, 2015, with Addendum dated April 10, 2015*	10-K	001-12235	10.33.1	May 23, 2019
10.40	Triumph Group, Inc. Executive General Severance Plan, effective February 19, 2019*	10-K	001-12235	10.33.1	May 23, 2019

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
10.14		Form of Third Amended and Restated Credit Agreement, dated as of November 19, 2013, by and among Triumph Group, Inc., and the other Borrowers party thereto and the Guarantors party thereto and the Banks party thereto and PNC Bank, National Association, as Administrative Agent, PNC Capital Markets LLC, J.P. Morgan Securities, LLC, RBC Capital Markets, RBS Citizens, N.A., and Santander Bank, N.A., as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank N.A., Royal Bank of Canada, Citizens Bank of Pennsylvania, and Santander Bank, N.A., as Syndication Agents, the Bank of Tokyo-Mitsubishi UFJ, Ltd, U.S. Bank National Association, TD Bank, N.A., and Manufacturers and Traders Trust Company, as Documentation Agents		8-K	001-12235	10.1	November 25, 2013
10.15		Form of Second Amended and Restated Guarantee and Collateral Agreement made by Triumph Group, Inc., and certain of its Subsidiaries in favor of PNC Bank, National Association, as Administrative Agent and as Collateral Agent for the other Secured Parties identified herein, dated as of November 19, 2013		8-K	001-12235	10.2	November 25, 2013
10.16		Triumph Group, Inc. 2013 Equity and Cash Incentive Plan*		10-K	001-12235	10.23	May 19, 2014
10.17		Form of letter regarding eligibility to participate in the Triumph Group, Inc. Restricted Stock Plan*		10-K	001-12235	10.24	May 19, 2014
10.18		Form of letter regarding grant of award under the Triumph Group, Inc. Executive Incentive Plan*		10-K	001-12235	10.25	May 19, 2014
10.19		Tenth Amendment to Receivables Purchase Agreement dated as of November 25, 2014		8-K	001-12235	10.1	November 26, 2014
10.20		Third Amendment to Third Amended and Restated Credit Agreement, dated as of February 2015, by and among Triumph Group, Inc. and the other Borrowers party thereto and the Guarantors party thereto and the Banks party thereto and PNC Bank, National Association, as Administrative Agent		10-Q	001-12235	10.1	February 9, 2015
10.21		Separation letter agreement between Triumph Group, Inc. and Jeffry D. Frisby, dated April 7, 2015*		8-K	001-12235	10.1	April 8, 2015
10.22		The First Amendment of the Triumph Group, Inc. Supplemental Executive Retirement Plan, effective as of May 1, 2015*		8-K	001-12235	10.1	May 7, 2015
10.23		First Amendment to Triumph Group, Inc. 2013 Employee Stock Purchase Plan*		10-Q	001-12235	10.1	August 4, 2015
10.24		Consulting Agreement between Triumph Group, Inc. and Richard C. Ill, dated as of January 4, 2016*		8-K	001-12235	10.1	January 7, 2016
10.25		Employment agreement between Triumph Group, Inc. and Daniel J. Crowley, dated as of April 1, 2016*		8-K	001-12235	10.1	April 7, 2016

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
10.26		Form of Sixth Amendment to Third Amended and Restated Credit Agreement, dated May 3, 2016		8-K	001-12235	10.1	May 4, 2016
21.1		Subsidiaries of Triumph Group, Inc.		#	#	#	#
23.1		Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm		#	#	#	#
31.1		Principal Executive Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.		#	#	#	#
31.2		Principal Financial Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.		#	#	#	#
32.1		Principal Executive Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.		##	##	##	##
32.2		Principal Financial Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.		##	##	##	##
101		The following financial information from Triumph Group, Inc.’s Annual Report on Form 10-K for the fiscal year ended March 31, 2016 formatted in XBRL: (i) Consolidated Balance Sheets as of March 31, 2016 and 2015; (ii) Consolidated Statements of Income for the fiscal years ended March 31, 2016, 2015 and 2014; (iii) Consolidated Statements of Stockholders’ Equity for the fiscal years ended March 31, 2016, 2015 and 2014; (iv) Consolidated Statements of Cash Flows for the fiscal years ended March 31, 2016, 2015 and 2014; (v) Consolidated Statements of Comprehensive Income for the fiscal years ended March 31, 2016, 2015 and 2014; and (vi) Notes to the Consolidated Financial Statements.		#	#	#	#

Exhibit Number	Exhibit Description	Incorporated by Reference to
		Form	File No.	Exhibit(s)	Filing Date
10.41	Triumph Group, Inc. Executive Change in Control Severance Plan, effective February 19, 2019*	10-K	001-12235	10.33.1	May 23, 2019
10.42	Eleventh Amendment to the Third Amended and Restated Credit Agreement, dated September 23, 2019	10-Q	001-12235	10.1	November 7, 2019
10.43	Twelfth Amendment to the Third Amended and Restated Credit Agreement, dated May 22, 2020	#	#	#	#
10.44	Twenty-Fifth Amendment to the Receivables Purchase Agreement dated as of December 6, 2019 (Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on December 9, 2019)	8-K	001-12235	10.1	December 9, 2019
10.45	Employment Letter between Triumph Group, Inc. and Jennifer Allen, dated August 14, 2018	#	#	#	#
21.1	Subsidiaries of Triumph Group, Inc.	#	#	#	#
23.1	Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm	#	#	#	#
31.1	Principal Executive Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.	#	#	#	#
31.2	Principal Financial Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.	#	#	#	#
32.1	Principal Executive Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.	##	##	##	##
32.2	Principal Financial Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.	##	##	##	##
101	The following financial information from Triumph Group, Inc.’s Annual Report on Form 10-K for the fiscal year ended March 31, 2020 formatted in iXBRL: (i) Consolidated Balance Sheets as of March 31, 2020 and 2019; (ii) Consolidated Statements of Operations for the fiscal years ended March 31, 2020, 2019, and 2018; (iii) Consolidated Statements of Stockholders’ (Deficit) Equity for the fiscal years ended March 31, 2020, 2019, and 2018; (iv) Consolidated Statements of Cash Flows for the fiscal years ended March 31, 2020, 2019, and 2018; (v) Consolidated Statements of Comprehensive Loss for the fiscal years ended March 31, 2020, 2019, and 2018; and (vi) Notes to the Consolidated Financial Statements	#	#	#	#
104	Cover Page Interactive Data File, formatted in iXBRL and contained in Exhibit 101.	#	#	#	#

In accordance with Item 601(b)(4)(iii)(A) of Regulations S-K, copies of specific instruments defining the rights of holders of long-term debt of the Company or its subsidiaries are not filed herewith. Pursuant to this regulation, we hereby agree to furnish a copy of any such instrument to the SEC upon request

*
*	Indicates management contract or compensatory plan or arrangement

#
#	Filed herewith

##
##	Furnished herewith

Item 16.  Form 10-K Summary

The Registrant has elected not to include a summary.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed by the undersigned, thereunto duly authorized.

		TRIUMPH GROUP, INC.
			/s/
				/s/ Daniel J. Crowley
Dated:		May 27, 201628, 2020	By:	Daniel J. Crowley President, Chief Executive Officer and Director (Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

/s/ Daniel J. Crowley		President, Chief Executive Officer and Director		May 28, 2020
/s/ Daniel J. Crowley			(Principal Executive Officer)	May 27, 2016
Daniel J. Crowley
/s/ Jeffrey L. McRae
		Senior Vice President and Chief Financial Officer		May 28, 2020
/s/ James F. McCabe, Jr.		(Principal Financial Officer)	May 27, 2016
Jeffrey L. McRae James F. McCabe, Jr.
		Vice President, Investor Relations and Controller		May 28, 2020
/s/ Thomas A. Quigley III		Vice President and Controller (Principal (Principal Accounting Officer)	May 27, 2016
Thomas A. Quigley III
/s/ Ralph E. Eberhart		Chairman and Director		May 27, 201628, 2020
Ralph E. Eberhart
/s/ Paul Bourgon		Director		May 27, 201628, 2020
Paul Bourgon
/s/ John G. Drosdick		Director	May 27, 2016
John G. Drosdick /s/ Daniel P. Garton		Director		May 28, 2020
Daniel P. Garton
/s/ Richard C. GozonGoglia		Director		May 27, 201628, 2020
Richard C. GozonGoglia
/s/ Dawne S. Hickton		Director	May 27, 2016
Dawne S. Hickton /s/ Barbara Humpton		Director		May 28, 2020
/s/ Richard C. Ill Barbara Humpton		Director	May 27, 2016
Richard C. Ill
/s/ William L. Mansfield		Director		May 27, 201628, 2020
William L. Mansfield
/s/ Adam J. Palmer		Director		May 27, 201628, 2020
Adam J. Palmer
/s/ Joseph M. Silvestri		Director	May 27, 2016
Joseph M. Silvestri /s/ Colleen C. Repplier		Director		May 28, 2020
/s/ George Simpson Colleen C. Repplier		Director	May 27, 2016
George Simpson
/s/ Larry O. Spencer		Director		May 28, 2020
Larry O. Spencer

EXHIBIT INDEX

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
2.1		Agreement and Plan of Merger, dated as of March 23, 2010, by and among Triumph Group, Inc., Vought Aircraft Industries, Inc., Spitfire Merger Corporation and TC Group, L.L.C., as the Holder Representative		8-K	001-12235	2.1	March 23, 2010
3.1		Amended and Restated Certificate of Incorporation of Triumph Group, Inc.		10-K	001-12235	3.1	May 22, 2009
3.1.1		Certificate of Amendment of Amended and Restated Certificate of Incorporation of Triumph Group, Inc.		8-K	001-12235	3.1	July 20, 2012
3.2		Amended and Restated By-Laws of Triumph Group, Inc.		8-K/A	001-12235	3.2	August 2, 2012
4.1		Form of certificate evidencing Common Stock of Triumph Group, Inc.		S-1	333-10777	4	August 23, 1996
4.2		Indenture, dated as of September 18, 2006, between Triumph Group, Inc. and The Bank of New York Trust Company, N.A. relating to the 2.625% Convertible Senior Subordinated Notes Due 2026		8-K	001-12235	4.1	September 22, 2006
4.2.1		Form of the 2.625% Convertible Senior Subordinated Note Due 2026 (included as Exhibit A to Exhibit 4.1)		8-K	001-12235	4.2	September 22, 2006
4.3		Registration Rights Agreement, dated as of September 18, 2006, between Triumph Group, Inc. and Banc of America Securities LLC		8-K	001-12235	4.3	September 22, 2006
4.4		Indenture, dated as of November 16, 2009, between Triumph Group, Inc. and U.S. Bank National Association, as trustee, relating to the 8% Senior Subordinated Notes due 2017.		8-K	001-12235	4.1	November 19, 2009
4.4.1		Form of 8% Senior Subordinated Notes due 2017 (included as Exhibit A to Indenture filed as Exhibit 4.1)		8-K	001-12235	4.2	November 19, 2009
4.5		Registration Rights Agreement, dated November 16, 2009, by and among Triumph Group, Inc., the Guarantors party thereto, and the other parties thereto.		8-K	001-12235	4.3	November 19, 2009
4.6		Indenture, dated as of June 16, 2010, between Triumph Group, Inc. and U.S. Bank National Association, as trustee, relating to the 8.625% Senior Subordinated Notes Due 2018		8-K	001-12235	4.1	June 22, 2010
4.7		Registration Rights Agreement, dated as of June 16, 2010, by and among Triumph Group, Inc., the Guarantors party thereto and the other parties thereto		8-K	001-12235	4.3	June 22, 2010
4.8		Indenture, dated as of February 26, 2013, between Triumph Group, Inc. and U.S. Bank National Association, as trustee		8-K	001-12235	4.1	March 1, 2013
4.8.1		Form of 4.875% Senior Subordinated Notes due 2021(included as Exhibit A to Exhibit 4.1)		8-K	001-12235	4.2	March 1, 2013
4.9		Registration Rights Agreement, dated February 26, 2013 between Triumph Group, Inc. and the parties named therein		8-K	001-12235	4.3	March 1, 2013

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
4.10		Indenture, dated as of June 3, 2014, between Triumph Group, Inc. and U.S. Bank National Association, as trustee		8-K	001-12235	4.1	June 5, 2014
4.10.1		Form of 5.250% Senior Notes due 2022 (included as Exhibit A to the Indenture filed as Exhibit 4.1)		8-K	001-12235	4.2	June 5, 2014
4.11		Registration Rights Agreement, dated June 3, 2014, between Triumph Group, Inc. and parties named therein		8-K	001-12235	4.3	June 5, 2014
4.12		Second Supplemental Indenture dated as of May 18, 2016 by and among Triumph Group, Inc., the guarantors signatory thereto and U.S. Bank National Association, as trustee, relating to the 4.875% Senior Notes due 2021		#	#	#	#
10.1		Amended and Restated Directors’ Stock Incentive Plan		10-K	001-12235	10.1	May 29, 2012
10.1.1		Form of Deferred Stock Unit Award Agreement under the Amended and Restated Directors’ Stock Incentive Plan		10-K	001-12235	10.2	May 30, 2013
10.2		Triumph Group, Inc. 2004 Stock Incentive Plan*		10-K	001-12235	10.3	May 30, 2013
10.2.1		Form of Stock Award Agreement under the 2004 Stock Incentive Plan*		10-K	001-12235	10.7	May 22, 2009
10.2.2		Form of letter confirming Stock Award Agreement under the 2004 Stock Incentive Plan*		10-K	001-12235	10.8	May 22, 2009
10.3		Triumph Group, Inc. Supplemental Executive Retirement Plan effective January 1, 2003*		10-K	001-12235	10.17	June 12, 2003
10.4		Compensation for the non-employee members of the Board of Directors of Triumph Group, Inc.		10-K	001-12235	10.6	May 30, 2013
10.5		Description of the Triumph Group, Inc. Annual Cash Bonus Plan*		8-K	001-12235	10.1	July 31, 2007
10.6		Change of Control Employment Agreements with: Richard C. Ill and John B. Wright, II.		8-K	001-12235	10.1 and 10.3	March 13, 2008
10.7		Form of Receivables Purchase Agreement, dated August 7, 2008, by and among the Triumph Group, Inc., as Initial Servicer, Triumph Receivables, LLC, as Seller, the various Purchasers and Purchase Agents from time to time party thereto and PNC National Association, as Administrative Agent.		8-K	001-12235	10.1	August 12, 2008
10.8		Stockholders Agreement, dated as of March 23, 2010, among Triumph Group, Inc., Carlyle Partners III, L.P., Carlyle Partners II, L.P., Carlyle International Partners II, L.P., Carlyle-Aerostructures Partners, L.P., CHYP Holdings, L.L.C., Carlyle-Aerostructures Partners II, L.P., CP III Coinvestment, L.P., C/S International Partners, Carlyle-Aerostructures International Partners, L.P., Carlyle-Contour Partners, L.P., Carlyle SBC Partners II, L.P., Carlyle International Partners III, L.P., Carlyle-Aerostructures Management, L.P., Carlyle-Contour International Partners, L.P., Carlyle Investment Group, L.P. and TC Group, L.L.C		8-K	001-12235	10.1	March 23, 2010

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
10.9		Third Amendment to Receivables Purchase Agreement, dated as of June 21, 2010, by and among Triumph Receivables LLC, Triumph Group, Inc., Market Street Funding LLC and PNC Bank, National Association		8-K	001-12235	10.1	June 25, 2010
10.10		Triumph Group, Inc. Executive Incentive Plan, effective September 28, 2010*		10-Q	001-12235	10.1	November 5, 2010
10.11		Form of letter informing Triumph Group, Inc. executives they are eligible to participate in the Company’s Long Term Incentive Plan *		10-K	001-12235	10.22	May 18, 2011
10.12		Form of letter informing Triumph Group, Inc. executives they have earned an award under the Company’s Long Term Incentive Plan and the amount of the award *		10-K	001-12235	10.23	May 18, 2011
10.13		Sixth Amendment to Receivables Purchase Agreement, dated as of February 26, 2013, by and among Triumph Receivables LLC, Triumph Group, Inc., Market Street Funding LLC and PNC Bank, National Association *		8-K	001-12235	10.1	March 1, 2013
10.14		Form of Third Amended and Restated Credit Agreement, dated as of November 19, 2013, by and among Triumph Group, Inc., and the other Borrowers party thereto and the Guarantors party thereto and the Banks party thereto and PNC Bank, National Association, as Administrative Agent, PNC Capital Markets LLC, J.P. Morgan Securities, LLC, RBC Capital Markets, RBS Citizens, N.A., and Santander Bank, N.A., as Joint Lead Arrangers and Joint Bookrunners, JPMorgan Chase Bank N.A., Royal Bank of Canada, Citizens Bank of Pennsylvania, and Santander Bank, N.A., as Syndication Agents, the Bank of Tokyo-Mitsubishi UFJ, Ltd, U.S. Bank National Association, TD Bank, N.A., and Manufacturers and Traders Trust Company, as Documentation Agents		8-K	001-12235	10.1	November 25, 2013
10.15		Form of Second Amended and Restated Guarantee and Collateral Agreement made by Triumph Group, Inc., and certain of its Subsidiaries in favor of PNC Bank, National Association, as Administrative Agent and as Collateral Agent for the other Secured Parties identified herein, dated as of November 19, 2013		8-K	001-12235	10.2	November 25, 2013
10.16		Triumph Group, Inc. 2013 Equity and Cash Incentive Plan*		10-K	001-12235	10.23	May 19, 2014
10.17		Form of letter regarding eligibility to participate in the Triumph Group, Inc. Restricted Stock Plan*		10-K	001-12235	10.24	May 19, 2014
10.18		Form of letter regarding grant of award under the Triumph Group, Inc. Executive Incentive Plan*		10-K	001-12235	10.25	May 19, 2014
10.19		Tenth Amendment to Receivables Purchase Agreement dated as of November 25, 2014		8-K	001-12235	10.1	November 26, 2014

Exhibit Number		Exhibit Description		Incorporated by Reference to
				Form	File No.	Exhibit(s)	Filing Date
10.20		Third Amendment to Third Amended and Restated Credit Agreement, dated as of February 2015, by and among Triumph Group, Inc. and the other Borrowers party thereto and the Guarantors party thereto and the Banks party thereto and PNC Bank, National Association, as Administrative Agent		10-Q	001-12235	10.1	February 9, 2015
10.21		Separation letter agreement between Triumph Group, Inc. and Jeffry D. Frisby, dated April 7, 2015*		8-K	001-12235	10.1	April 8, 2015
10.22		The First Amendment of the Triumph Group, Inc. Supplemental Executive Retirement Plan, effective as of May 1, 2015*		8-K	001-12235	10.1	May 7, 2015
10.23		First Amendment to Triumph Group, Inc. 2013 Employee Stock Purchase Plan*		10-Q	001-12235	10.1	August 4, 2015
10.24		Consulting Agreement between Triumph Group, Inc. and Richard C. Ill, dated as of January 4, 2016*		8-K	001-12235	10.1	January 7, 2016
10.25		Employment agreement between Triumph Group, Inc. and Daniel J. Crowley, dated as of April 1, 2016*		8-K	001-12235	10.1	April 7, 2016
10.26		Form of Sixth Amendment to Third Amended and Restated Credit Agreement, dated May 3, 2016		8-K	001-12235	10.1	May 4, 2016
21.1		Subsidiaries of Triumph Group, Inc.		#	#	#	#
23.1		Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm		#	#	#	#
31.1		Principal Executive Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.		#	#	#	#
31.2		Principal Financial Officer Certification Required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.		#	#	#	#
32.1		Principal Executive Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.		##	##	##	##
32.2		Principal Financial Officer Certification Required by Rule 13a-14(b) or Rule 15d-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350.		##	##	##	##
101		The following financial information from Triumph Group, Inc.’s Annual Report on Form 10-K for the fiscal year ended March 31, 2016 formatted in XBRL: (i) Consolidated Balance Sheets as of March 31, 2016 and 2015; (ii) Consolidated Statements of Income for the fiscal years ended March 31, 2016, 2015 and 2014; (iii) Consolidated Statements of Stockholders’ Equity for the fiscal years ended March 31, 2016, 2015 and 2014; (iv) Consolidated Statements of Cash Flows for the fiscal years ended March 31, 2016, 2015 and 2014; (v) Consolidated Statements of Comprehensive Income for the fiscal years ended March 31, 2016, 2015 and 2014; and (vi) Notes to the Consolidated Financial Statements.		#	#	#	#

In accordance with Item 601(b)(4)(iii)(A) of Regulations S-K, copies of specific instruments defining the rights of holders of long-term debt of the Company or its subsidiaries are not filed herewith. Pursuant to this regulation, we hereby agree to furnish a copy of any such instrument to the SEC upon request

*	Indicates management contract or compensatory plan or arrangement

#	Filed herewith

##	Furnished herewith

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