AAR Corp. (AIR) Q1 Earnings Beat Estimates, Sales Rise Y/Y
AAR Corp. AIR reported first-quarter fiscal 2024 adjusted earnings of 78 cents per share, which surpassed the Zacks Consensus Estimate of 73 cents by 6.9%. Earnings surged 27.9% from the year-ago quarter.
The company reported GAAP earnings per share (EPS) of 2 cents compared with 62 cents in the prior-year quarter.
Total Sales
In the quarter under review, AAR generated net sales worth $549.7 million. The reported figure surpassed the Zacks Consensus Estimate by 8.7% and increased 23.2% from the $446.3 million recorded in the year-ago quarter.
AAR Corp. Price, Consensus and EPS Surprise
AAR Corp. price-consensus-eps-surprise-chart | AAR Corp. Quote
Segment Details
In the fiscal first quarter, sales in the Parts Supply segment totaled $236.8 million, up 40.5% year over year.
Repair & engineering reported sales of $137.5 million, up 7.8% from the prior-year period.
Integrated solutions sales came in at $156.3 million compared with $127.8 million in the year-ago period.
Expeditionary Services recorded sales of $19.1 million, down 14.3% from $22.3 million in the year-ago quarter.
Operational Update
The adjusted gross profit margin in the reported quarter improved to 18.4% from 18.1% in the prior-year quarter. The margin expansion was a result of the favorable impacts of operating efficiency on increased sales volumes.
Adjusted SG&A as a percent of sales decreased from 11.2% of sales to 11% in the fiscal first quarter. The adjusted operating margin expanded to 7.3% from 6.9% in the prior-year quarter, driven by growth in commercial sales. AIR incurred net interest expenses of $5.4 million in the fiscal first quarter compared with $1 million in the year-ago quarter.
Financial Details
As of Aug 31, 2023, AAR’s cash and cash equivalents amounted to $70.3 million compared with $68.4 million as of May 31, 2023.
The company reported long-term debt of $304.8 million as of Aug 31, 2023, up from $269.7 million as of May 31, 2023.
Zacks Rank
AAR currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Defense Releases
Lockheed Martin LMT: It is likely to report its third-quarter earnings in October 2023. The Zacks Consensus Estimate for LMT’s third-quarter earnings calls for a decline of 2.6% from the prior-year reported figure.
The Zacks Consensus Estimate for Lockheed’s third-quarter sales implies a growth rate of 0.3% from the prior-year reported figure. LMT delivered an earnings surprise of 4.67% in the last reported quarter.
Leidos Holdings, Inc. LDOS: The company is scheduled to report its third-quarter earnings on Oct 31, 2023. The Zacks Consensus Estimate for LDOS’ third-quarter earnings suggests a growth rate of 3.1% from the prior-year reported figure.
The Zacks Consensus Estimate Leidos’ third-quarter sales implies a growth rate of 4.6% from the prior-year reported figure. LDOS delivered an earnings surprise of 16.13% in the last reported quarter.
Northrop Grumman NOC: It is slated to report its third-quarter earnings on Oct 26, 2023. The Zacks Consensus Estimate for NOC’s third-quarter earnings suggests a decrease of 2.7% from the prior-year reported figure.
The Zacks Consensus Estimate for Northrop’s third-quarter sales hints at a growth rate of 7.7% from the prior-year reported figure. NOC delivered an earnings surprise of 0.56% in the last reported quarter.
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