| AAR Announces First Quarter Results
WOOD DALE, Ill., Sep 20, 2001 /PRNewswire/ -- AAR (NYSE: AIR) today
reported diluted earnings per share of $0.02 and net income of $0.5 million for
the first quarter of Fiscal 2002, which ended August 31, 2001. Sales for the
quarter were $203.0 million. These results are consistent with the Company's
preliminary earnings report released on September 10, 2001. A copy of that press
release is available on the Company's web site, aarcorp.com .
The Company is comprised of a balanced portfolio of businesses serving many
aspects of the commercial and military aviation/aerospace industry. Supporting
commercial airlines is a major element of AAR's business. Accordingly, in view
of the Company's recent results and in light of the unprecedented tragedy and
its impact on the commercial airline industry, AAR has taken immediate steps to
reduce its indirect, selling, general and administrative cost structure in
excess of $12 million annually. These savings will be obtained through a
combination of workforce reductions, facility consolidations and reduction of
non-strategic spending.
"Despite this industry upheaval, we are encouraged by the dialogue that we have
had with our airline customers as they look for effective alternatives to
navigate their way through these uncertain times," said Storch. "We see our role
in the industry as a cost reduction resource for our customers. We also support
the U.S. Government's initiative to provide financial assistance to the
commercial airline industry, which is a vital link to worldwide economic well
being."
The Company expects to see an increased demand for products and services in
support of the U.S. Military. AAR provides a broad range of military support
capabilities including rapid deployment products, aircraft maintenance, and
spare parts repair and supply. Sales in support of the U.S. Government
represented approximately 16% of the Company's sales during the past twelve
months.
"AAR's strong financial condition, broad array of cost effective products and
services, and our diverse and worldwide customer base will enable us to progress
these trying times as we have done many times before in our fifty year history,"
said Storch.
AAR would like to express its deepest sympathies to those affected by last
week's tragic events. The Company extends its gratitude to all men and women who
are assisting in the World Trade Center relief effort. AAR fully supports the
efforts of President Bush, his administration, and the worldwide coalition to
combat terrorism. "Our hearts go out to the families and friends of those lost
or injured," said AAR President and CEO David P. Storch. "We would like to
further express our condolences to the United Airlines and American Airlines
extended families."
AAR will hold its quarterly conference call at 10:00 AM (CST) on Thursday,
September 20, 2001. The conference call can be accessed via dial-in
(1-719-457-2641; conference code 490850). A replay of the call will be available
(1-719-457-0820; conference code 490850) until 12 AM on Thursday, September 27,
2001.
AAR (NYSE: AIR) is the preeminent provider of products and value-added services
to the worldwide aerospace/aviation industry. Products and services include
proprietary inventory management and logistic support services, encompassing
supply, repair and manufacture of spare parts and systems. Headquartered in Wood
Dale, Illinois, AAR serves commercial and government aircraft fleet operators
and independent service customers throughout the world. Further 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, depending on a variety of factors,
including: general economic conditions, implementation of information technology
systems, integration of acquisitions, marketplace competition, economic and
aviation/aerospace market stability and Company profitability. 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 publicly release the result of any revisions that may
be made to 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. AAR CORP. and Subsidiaries
Comparative Statement of Earnings Three Months Ended
(In thousands except per share data) August 31,
2001 2000
(Unaudited)
Sales $202,993 $224,888
Pass through sales 0 16,882
Total sales 202,993 241,770
Gross profit 29,140 34,415
SG&A 23,695 24,544
Operating income 5,445 9,871
Interest expense 5,544 5,988
Interest income 747 506
Pretax income 648 4,389
Net income 486 3,159
Earnings Per Share-Basic $0.02 $0.12
Earnings Per Share-Diluted $0.02 $0.12
Average shares outstanding-Basic 26,945 26,859
Average shares outstanding-Diluted 27,209 26,962
Balance Sheet Highlights August 31, May 31,
(In thousands except per share data) 2001 2001
(Unaudited) (Derived from
audited financial
statements)
Current assets $540,105* $485,856
Current liabilities 172,398* 125,392
Working capital 367,707* 360,464
Total assets 758,503 701,854
Long-term debt 189,920 179,987
Stockholders' equity 340,147 340,212
Book value per share $ 12.62 $ 12.63
Shares outstanding 26,958 26,937
* Reflects the recent issuance of $75 million of long-term notes in
anticipation of repayment of $65 million of notes maturing in November
Sales and Gross Profit By Segment
(In thousands) Three Months Ended August 31,
2001 2000
(Unaudited) (Unaudited)
Sales Gross Profit Sales Gross Profit
Aircraft & Engines $84,079 $11,149 $97,673 $15,246
Airframe & Accessories 96,959 15,929 104,209 16,264
Manufacturing 21,955 2,062 23,006 2,905
$202,993 $29,140 $224,888 34,415
Pass Through Sales 0 0 16,882 0
$202,993 $29,140 $241,770 $34,415
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