AeroVironment Inc.'s (AVAV) fiscal second-quarter profit tumbled
76% as product sales tumbled, although revenue from contract
services and margins improved.
The company - which makes small, pilotless drones called Ravens
for the military and rechargeable-battery technology for electronic
industrial vehicles - has benefited from higher government spending
on the military and "green" technology.
Broadpoint Amtech analysts warned last month results could have
been hurt as customers waited for the company's newest product,
which was rolled out just at the end of the quarter. The firm said
anticipation has been high for the Digital Data Link upgrade, and
that sales will ramp up through the rest of the fiscal year.
Chairman and Chief Executive Tim Conver said Tuesday the company
was confident in its ability to meet strong consumer demand for the
systems during the second half of the fiscal year, and affirmed
AeroVironment's full-year revenue target.
For the quarter ended Oct. 31, AeroVironment reported earnings
of $2.2 million, or 10 cents a share, down from $9.1 million, or 41
cents a share, a year earlier. Revenue fell 22% to $51.4
million.
Analysts surveyed by Thomson Reuters expected earnings of 5
cents on revenue of $52 million.
Gross margin grew to 38.3% from 38%, while inventories more than
doubled since Oct. 31. Product sales tumbled 49%, while revenue
from contract services improved 13%.
The funded backlog - unfilled orders for which customers have
appropriated funding - fell 6.7% during the quarter to $107.1
million.
Shares were down 0.8% to $28.69 in after-hours trading. At the
close, the stock is down 21% this year.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com