AAR Announces 3rd Quarter Records for Sales and Net Income
-- Gains in Working Capital Turnover Initiative
-- AAR Repurchases Shares on Open Market
WOOD DALE, Ill., -- AAR CORP. today announced net income of $10.3 million, or 37 cents per diluted share, for the company's fiscal year 1999 third quarter, which ended February 28. It was the company's seventeenth consecutive quarter of year-over-year earnings per share increases.
"Air traffic continues to grow albeit at a slower pace, the commercial airline industry remains financially healthy and aerospace and airline managements continue to seek outsourcing opportunities. As the industry's leading supplier of value-added products and services, AAR is in a strong position to benefit from these trends, and we anticipate that the company will continue to deliver attractive year-over-year earnings growth," President and Chief Executive Officer David P. Storch said.
Net sales for the period were a third-quarter record $227.7 million, an increase of 9.2% from the third quarter last year. After adjusting for the impact of acquisitions, divestitures and joint ventures the sales increase was 13.6%. Net income, also a third-quarter record, was $10.3 million, 10.4% higher than the same period last year. Diluted earnings per share increased 12.1% from the third quarter of 1998.
"AAR posted another strong quarter. Our Aircraft and Engines Group recorded a 29.2% increase in net sales from the previous third quarter. Providing our customers with a range of solutions for their maintenance support and operational needs is a key advantage for AAR in gaining market share and continuing to grow revenues," Storch said.
Net sales in the Airframe and Accessories Group fell short of expectations for the period, as gains in landing gear maintenance, including the successful integration of the Tempco Hydraulics acquisition, and other areas were offset by lower-than-expected results in the company's new parts distribution business. AAR built its new parts distribution business with acquisitions made during the past two years.
"AAR's new parts distribution business has not developed as quickly as we anticipated due to systems implementation and integration delays. We have made changes in leadership in this business and converted the last of our fourteen branch locations to a new Oracle distribution system this past weekend. We are confident that new parts distribution will be a meaningful contributor in the year 2000," Storch said.
Manufacturing Group revenues were up 9.6% on a year-over-year basis after giving effect to the November, 1998 sale of the PowerBoss division. "We have made significant progress in our initiative to improve working capital turnover increasing to 3.2 from 2.8 in the first nine months of the year. We are pleased with our progress to date and are confident that we can make further improvement," said Storch.
He concluded by saying, "In the third quarter, AAR repurchased shares on the open market under its existing share repurchase authorization and will continue to do so based on our assessment of the best uses of the Company's capital."
AAR CORP. (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.
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: implementation of information technology systems, integration of acquisitions, marketplace competition, unidentified Year 2000 problems, 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.
AAR CORP. and Subsidiaries Comparative Statement of Earnings For the Three-and Nine-Month Periods Ended February 28, 1999 and 1998 (in thousands except per share data) Three Months Nine Months 1999 1998 1999 1998 (Unaudited) (Unaudited) Net sales $227,699 $208,492 $672,395 $559,554 Operating income 18,938 17,079 55,878 44,889 Pretax income 14,746 13,399 42,950 35,869 Net income 10,278 9,314 29,936 25,035 Earnings per share - Basic $.37 $.34 $ 1.08 $.91 Earnings per share - Diluted $.37 $.33 $1.07 $.89 Average shares outstanding - Basic 27,535 27,632 27,606 27,550 Average shares outstanding - Diluted 27,965 28,510 28,108 28,141 AAR CORP. and Subsidiaries Balance Sheet Highlights (in thousands except per share data) February 28, May 31, 1999 1998 (Unaudited) (Derived from audited financial statements) Current assets $498,123 $468,400 Current liabilities 159,874 149,148 Working capital 338,249 319,252 Long-term debt 181,018 177,509 Stockholders' equity 320,328 300,850 Book value per share $11.67 $10.85 Shares outstanding 27,443 27,717 Net Sales By Business Activity (in thousands) Three Months Ended February 28, 1999 1998 Aircraft and Engines $111,117 $85,992 Airframe and Accessories 89,282 91,632 Manufacturing 27,300 30,868 $227,699 $208,492 SOURCE AAR CORP. -0- 03/15/99 /CONTACT: Ann T. Baldwin, Vice President Corporate Communications of AAR CORP., 630-227-2080, or e-mail, firstname.lastname@example.org/ /Web site: http://www.aarcorp.com/ (AIR) CO: AAR CORP. ST: Illinois IN: ARO SU: ERN SLS
Related newsSee all
December 11, 2023
AAR adds Woodward, Inc. (66503) distribution support under Supplier Capability Contract with DLA Aviation
Wood Dale, Illinois — AAR CORP. (NYSE: AIR), a leading provider of aviation products and services to commercial and government operators, MROs, and OEMs, has added distribution support of select Woodward, Inc. (Woodward) parts under its Supplier Capability Contract with DLA Aviation.
December 07, 2023
AAR to announce second quarter fiscal year 2024 results on December 21, 2023
Wood Dale, Illinois — AAR CORP. (NYSE: AIR), a leading provider of aviation services to commercial and government operators, MROs, and OEMs, today announced that it will release financial results for its second quarter of fiscal year 2024, ended November 30, 2023, after the close of the New York Stock Exchange trading session on Thursday, December 21, 2023.
December 07, 2023
AAR announces extension and expansion of Alaska Airlines MRO relationship, expected facility expansion in Oklahoma City
Wood Dale, Illinois — AAR CORP. (NYSE: AIR), a leading provider of aviation services to commercial and government operators, MROs, and OEMs, announced today it has signed an agreement to extend the Company’s existing airframe MRO services with Alaska Airlines through 2030 and expand its heavy maintenance partnership.