WOOD DALE, Ill., Sept. 22, 2016 /PRNewswire/ -- AAR CORP. (NYSE:
AIR) today reported first quarter Fiscal Year 2017 consolidated
sales of $404.8 million and income
from continuing operations of $9.9
million, or $0.29 per diluted
share. For the first quarter of the prior fiscal year, the
Company reported sales of $386.7
million and income from continuing operations of
$7.4 million, or $0.21 per diluted share.
"Our Aviation Services segment delivered strong results once
again as sales in the first quarter grew 6% from last year to
$334.6 million, contributing to
improved margins. Our supply chain business continued to
exhibit very good performance in the period," said David P. Storch, Chairman, President, and Chief
Executive Officer of AAR CORP. Recent government contract
awards contributed to sales growth in Aviation Services. Sales to
commercial customers increased from improved demand for aftermarket
parts trading and the ramp up of new distribution contracts.
We also announced several new commercial contracts during the
quarter for our programs business.
Storch continued, "We are very pleased with the award from the
Department of State Air Wing (INL/A) to provide maintenance,
logistics, and operations services under the Global Aviation
Support Services contract. The potential duration of this
contract is eleven years, including a 6 month phase-in. The
incumbent contractor filed a protest on September 11, 2016 and we expect a final decision
on the protest no later than December 21,
2016."
Gross profit increased over the prior year in both segments. In
the Aviation Services segment, there was an increase in gross
profit of $3.5 million primarily due
to sales growth. In the Expeditionary Services segment, gross
profit was up $4.1 million while
margins increased due to improved profitability in our mobility
products business. During the first quarter of fiscal 2017, we
decided to retain our composite manufacturing operations as a
product line in our mobility products business. As a result,
we reclassified our composite manufacturing operations to
continuing operations for all periods presented.
Selling, general and administrative expenses as a percentage of
sales were 11.1% for the first quarter, compared to 10.3% last
year. This increase was driven by investments in new business
development. Net interest expense from continuing operations
for the quarter was $1.3 million
compared to $1.9 million last
year.
During the first quarter, the Company paid cash dividends of
$2.6 million, or $0.075 per share, and repurchased approximately
619,000 shares for $14.8 million, or
$23.94 per share. Average
diluted share count for the quarter was 34.1 million compared to
35.1 million in the first quarter last year.
Conference Call
Information
AAR will hold its quarterly conference call at 3:45 p.m. CDT on September
22, 2016. The conference call can be accessed by calling
866-802-4322 from inside the U.S. or 703-639-1319 from outside the
U.S. A replay of the conference call will be available by
calling 888-266-2081 from inside the U.S. or 703-925-2533 from
outside the U.S. (access code 1623126). The replay will be
available from 8:15 p.m. CDT on
September 22, 2016, until
11:59 p.m. CDT on September 29, 2016.
About AAR
AAR is a global aftermarket solutions company that employs more
than 4,500 people in over 20 countries. Based in Wood Dale, Illinois, AAR supports commercial
aviation and government customers through two operating segments:
Aviation Services and Expeditionary Services. AAR's Aviation
Services include inventory management; parts supply; OEM parts
distribution; aircraft maintenance, repair and overhaul; and
component repair. AAR's Expeditionary Services include airlift
operations; mobility systems; and command and control centers in
support of military and humanitarian missions. Additional
information can be found at www.aarcorp.com.
This press release contains certain statements relating to
future results, which are forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of
1995. These forward-looking statements are based on beliefs
of Company management, as well as assumptions and estimates based
on information currently available to the Company, and are subject
to certain risks and uncertainties that could cause actual results
to differ materially from historical results or those anticipated,
including those factors discussed under Item 1A, entitled "Risk
Factors", included in the Company's Form 10-K for the fiscal year
ended May 31, 2016. Should one or
more of these risks or uncertainties materialize adversely, or
should underlying assumptions or estimates prove incorrect, actual
results may vary materially from those described. These
events and uncertainties are difficult or impossible to predict
accurately and many are beyond the Company's control. The
Company assumes no obligation to update any forward-looking
statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or
unanticipated events. For additional information, see the comments
included in AAR's filings with the Securities and Exchange
Commission.
AAR CORP. and
Subsidiaries
|
|
|
Consolidated
Statements of Income
(In millions
except per share data - unaudited)
|
Three Months
Ended
August
31,
|
|
2016
|
|
2015
|
|
|
|
|
Sales
|
$404.8
|
|
$386.7
|
Cost and
expenses:
|
|
|
|
Cost of
sales
|
343.3
|
|
332.8
|
Selling, general and
administrative
|
44.8
|
|
40.0
|
Loss from aircraft
joint ventures
|
-
|
|
(0.3)
|
Operating
income
|
16.7
|
|
13.6
|
Loss on
extinguishment of debt
|
-
|
|
(0.3)
|
Interest expense,
net
|
(1.3)
|
|
(1.9)
|
Income from
continuing operations before income taxes
|
15.4
|
|
11.4
|
Income tax
expense
|
5.5
|
|
4.0
|
Income from
continuing operations
|
9.9
|
|
7.4
|
|
|
|
|
Income (Loss) from
discontinued operations
|
(0.4)
|
|
15.5
|
|
|
|
|
Net
income
|
$9.5
|
|
$22.9
|
|
|
|
|
Earnings per share
– Basic
|
|
|
|
Earnings from continuing
operations
|
$0.29
|
|
$0.21
|
Earnings (Loss) from
discontinued operations
|
(0.01)
|
|
0.44
|
Earnings per share –
Basic
|
$0.28
|
|
$0.65
|
|
|
|
|
Earnings per share
– Diluted
|
|
|
|
Earnings from continuing
operations
|
$0.29
|
|
$0.21
|
Earnings (Loss) from
discontinued operations
|
(0.01)
|
|
0.44
|
Earnings per share –
Diluted
|
$0.28
|
|
$0.65
|
|
|
|
|
Share
Data:
|
|
|
|
Weighted average
shares outstanding – Basic
|
33.9
|
|
34.7
|
Weighted average
shares outstanding – Diluted
|
34.1
|
|
35.1
|
|
|
|
|
AAR CORP. and
Subsidiaries
|
|
|
Consolidated
Balance Sheet Highlights
(In millions
except per share data)
|
August 31,
2016
|
|
May 31,
2016
|
|
(Unaudited)
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$7.9
|
|
$31.2
|
Current
assets
|
849.4
|
|
881.7
|
Current
liabilities (excluding debt accounts)
|
307.4
|
|
329.4
|
Net property,
plant and equipment
|
231.4
|
|
238.1
|
Total
assets
|
1,427.0
|
|
1,456.0
|
Total
debt
|
151.6
|
|
150.1
|
Stockholders'
equity
|
858.5
|
|
865.8
|
Book value per
share
|
$25.10
|
|
$25.10
|
Shares
outstanding
|
34.2
|
|
34.5
|
|
|
|
Sales By Business
Segment
(In millions -
unaudited)
|
Three Months
Ended
August
31,
|
|
2016
|
|
2015
|
Aviation
Services
|
$334.6
|
|
$315.8
|
Expeditionary
Services
|
70.2
|
|
70.9
|
|
$404.8
|
|
$386.7
|
|
|
Gross Profit by
Business Segment
(In millions-
unaudited)
|
Three Months
Ended
August
31,
|
|
2016
|
|
2015
|
Aviation
Services
|
$53.4
|
|
$49.9
|
Expeditionary
Services
|
8.1
|
|
4.0
|
|
$61.5
|
|
$53.9
|
|
Note: Pursuant to SEC Regulation G, the Company has
included the following reconciliation of financial measure reported
on a non-GAAP basis to compare financial measures reported on the
basis of Generally Accepted Accounting Principles
("GAAP").
Net
Debt
(In millions-
unaudited)
|
August 31,
2016
|
|
August 31,
2015
|
Total
debt
|
$151.6
|
|
$179.5
|
Less: Cash and
cash equivalents
|
(7.9)
|
|
(28.7)
|
Net
debt
|
$143.7
|
|
$150.8
|
Logo - http://photos.prnewswire.com/prnh/20150319/183226LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/aar-reports-first-quarter-fiscal-year-2017-results-300332742.html
SOURCE AAR CORP.