Component armour (turrets, magazines, power plants, engines, fuel tanks, etc) reduces the chance that a point of internal damage (all internal damage is applied one point at a time) will destroy one HTK of the component. The chance is equal to (armour) / (armour + HTK), so 2 points of armour on a 3 HTK turret means 40% of the time it will be undamaged by a hit.