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AAR (AIR) Q4 Earnings Surpass Estimates, Sales Rise Y/Y

·3 min read

AAR Corp. AIR reported fourth-quarter fiscal 2022 adjusted earnings of 72 cents per share, which surpassed the Zacks Consensus Estimate of 68 cents by 5.9%. Earnings recorded a solid surge of 53.2% from the year-ago quarter.

The company reported GAAP earnings per share (EPS) of 66 cents compared with 41 cents generated in the prior-year quarter.

AAR Corp. reported adjusted earnings of $2.16 per share for fiscal 2022, up from $1.30 recorded in fiscal 2021.

Total Sales

In the quarter under review, AAR generated net sales worth $476.1 million. The reported figure surpassed the Zacks Consensus Estimate of $468 million by 1.7% and also improved 8.8% from $437.6 million recorded in the year-ago quarter.

For fiscal 2022, the company reported net sales worth $1,820 million, up from $1,652.3 million recorded in fiscal 2021.

AAR Corp. Price, Consensus and EPS Surprise

AAR Corp. Price, Consensus and EPS Surprise
AAR Corp. Price, Consensus and EPS Surprise

AAR Corp. price-consensus-eps-surprise-chart | AAR Corp. Quote

Segment Details

In the fiscal fourth quarter, sales at the Aviation Services segment totaled $452.9 million, up 9% year over year.

Expeditionary Services recorded sales of $23.2 million, up 4.5% from $22.2 million in the year-ago quarter.

Operational Update

Adjusted gross profit margin in the reported quarter improved to 18.6% from 16.5% in the prior-year quarter. The margin expansion was the result of favorable impacts of the company’s efforts to reduce costs and increase operational efficiency.

SG&A expenses rose 16.6% to $56.9 million in the fiscal fourth quarter, mainly due to digital and investigation, remediation, and strategic project costs. Adjusted operating margin expanded to 7% from 5.2% in the prior-year quarter, driven by the company’s efforts to improve operating efficiency as well as the recovery in commercial sales.

AIR incurred net interest expenses of $0.6 million in the fiscal fourth quarter compared with $0.9 million in the year-ago quarter.

Financial Details

As of May 31, 2022, AAR’s cash and cash equivalents amounted to $53.5 million compared with $51.8 million as of May 31, 2021.

AAR reported long-term debt of $98.9 million as of May 31, 2022, down from $133.7 million as of May 31, 2021.

Zacks Rank

AAR currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Defense Releases

L3Harris Technologies LHX is scheduled to release its second-quarter results on Jul 28. It holds a Zacks Rank #3.

LHX delivered a four-quarter average earnings surprise of 2.32%. The Zacks Consensus Estimate for L3Harris’ second-quarter earnings, pegged at $3.16, has moved up 0.3% over the past seven days. LHX boasts a long-term earnings growth rate of 4.4%.

Triumph Group TGI is scheduled to release its fiscal first-quarter results on Aug 2. It holds a Zacks Rank #3.

The Zacks Consensus Estimate for Triumph Group’s fiscal first-quarter earnings, pegged at 8 cents, has improved 33.3% over the past 30 days. TGI boasts a long-term earnings growth rate of 2.6%.

CAE Inc. CAE is expected to release its fiscal first-quarter results soon. It holds a Zacks Rank #3.

The Zacks Consensus Estimate for CAE’s fiscal first-quarter earnings, pegged at 18 cents, has remained unchanged over the past seven days. CAE boasts a long-term earnings growth rate of 16.9%.


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