Worldwide air travel is growing, airline fleets are expanding and the planes are getting bigger. One way to gain exposure to these trends is to invest in airlines or aircraft manufacturers.

Alternatively, investors can choose a supplier to the industry. The quantitative model employed by the Forbes Growth Investor has identified such an opportunity.

BE Aerospace makes seats and cabin interior systems for commercial and business aircraft. Its products can be installed in new planes or in existing planes that are being refurbished. In fact, about 60% of its sales come from the existing aircraft market.

Its customers include U.S. domestic carriers such as Continental Airlines and United Airlines as well as international airlines like Air China, Air France, British Airways, Cathay Pacific, Emirates Airlines, Qantas Airways and Singapore Airlines.

It also sells its products to Boeing, Airbus and Embraer.

The company operates five business segments. The seating segment is the largest, accounting for 37.2% of first-quarter sales. Seats typically include a frame, cushions, armrests and a tray table. Options include adjustable lumbar support systems, footrests, reading lights, head and neck supports, and oxygen masks.

First-class seats can lie flat and come with an ottoman, privacy panels and wall-mounted tables. Business-class seats include power ports, telephones, adjustable headrests and fiber-optic reading lights. Both first- and business-class seats incorporate electrical actuation. This segment also sells spare parts and upgrade kits.

Interior systems accounted for 20.9% of first-quarter sales. It designs and manufactures oxygen delivery systems, coffee makers and water boilers, convection and steam ovens, refrigeration equipment, lighting systems, storage compartments and other products for cabin interiors. This segment includes Draeger Aerospace, a maker of chemical and oxygen systems for civilian and military aircraft, which was acquired in September 2006.

The distribution segment produced 25% of first-quarter sales. It operates through its M&M Aerospace Hardware subsidiary. It offers an array of aerospace grade fasteners, fastening systems, related hardware and inventory management services to over 200 aerospace hardware manufacturers. In September 2006, this segment acquired New York Fasteners, a distributor of fasteners and other hardware to customers in the military sector.

The business jet segment accounted for 11.4% of first-quarter sales. It offers design services and manufactures furnishings and interior systems for executive aircraft. The remaining 5.5% of revenues came from the engineering services segment, which provides design, installation and certification services for aircraft cabin interiors. It also converts passenger planes to freighter planes and designs rest compartments for the crew.

According to Airline Monitor, a leading airline industry research provider, worldwide passenger traffic increased 5.9% in 2006. Deliveries for new large commercial aircraft and business jets jumped 24% and 19%, respectively. Demand for upgrades helped BE Aerospace's revenues grow 34% to US$1.13 billion. Bookings jumped 40% to US$1.7 billion.

Backlog at the end of 2006 stood at US$1.7 billion, up 60% from a year earlier. First-quarter net sales jumped 56.9% to US$387.8 million. BE booked US$450 million in new orders in the first quarter, and backlog climbed to US$1.85 billion.

Seating sales soared 77.8%. Interior systems gained 44%. Distribution sales jumped 80.4%. The operating profit margin expanded 196 basis points year-over-year to 14.54%. Net income surged 132.6% to US$32.1 million, or 40 cents per share.

BE depends on the good health of the airline and business jet industries, which are affected by many factors, including fuel costs and price competition. Based on its healthy backlog and strong order activity, BE should report excellent results for several quarters. It will benefit as carriers refurbish existing fleets and upgrade to newer wide-body planes such as the Boeing 777 and 787 and the Airbus A380.

These planes accommodate many more seats than traditional aircraft, which translates into a lot more business for BE.