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Triumph Group (TGI) Q1 Earnings Top Estimates, Sales Fall Y/Y

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Shares of Triumph Group Inc. TGI rose 10.3% to reach $18.84 on Aug 9, reflecting investors’ optimism following its encouraging fiscal first-quarter results.

The company’s adjusted earnings in first-quarter fiscal 2022 (ended Jun 30, 2021) were 9 cents per share, which surpassed the Zacks Consensus Estimate of 4 cents by a solid 125%. The bottom line also marked an improvement from the year-ago loss of 19 cents per share.

Including one-time adjustments, the company incurred GAAP loss of 47 cents per share in the fiscal first quarter compared with loss of $5.32 incurred a year ago.

Triumph Group, Inc. Price, Consensus and EPS Surprise

Triumph Group, Inc. Price, Consensus and EPS Surprise
Triumph Group, Inc. Price, Consensus and EPS Surprise

Triumph Group, Inc. price-consensus-eps-surprise-chart | Triumph Group, Inc. Quote

Total Sales

Net sales in the quarter under review came in at $396.6 million, surpassing the Zacks Consensus Estimate of $366 million by 8.5%. However, the top line declined 20% on a year-over-year basis due to planned reductions on sunsetting and divested programs.

After taking into account the impact of the divestitures and sunsetting programs, organic sales in the quarter went up 11% year over year driven by increased maintenance, repair and overhaul work.

Operational Highlights

In first-quarter fiscal 2022, the company generated adjusted operating income of $31.3 million, which improved a massive 102.8% from the year-ago quarter’s figure. Adjusted operating margin of 7.9% expanded 480 basis points from 3.1% in the first quarter of fiscal 2021.

Interest expenses and other amounted to $38.6 million, up 10.3% from the prior-year quarter.

Backlog came in at $1.90 billion, down on a sequential basis due to sunsetting programs and recent production rate reductions.

Segmental Performance

Aerospace Structures: Segment sales totaled $138.3 million, down 46.4% from $257.9 million in the year-ago quarter. The segment reported operating income of $11.2 million during first-quarter fiscal 2022.

Systems & Support: Segment sales improved 7.7% year over year to $258.4 million. Operating income was $35.5 million in first-quarter fiscal 2022.

Financial Position

As of Jun 30, 2021, Triumph Group’s cash and cash equivalents totaled $237.5 million, compared with $589.9 million as of Mar 31, 2021.

Its long-term debt (excluding current portion) amounted to $1.61 billion as of Jun 30, 2021, compared with $1.95 billion as on Mar 31, 2021.

Net cash used in operating activities in the first quarter of fiscal 2022 was $149.5 million compared to net cash outflow worth $197.5 million as of Mar 31, 2021.

The company’s capital expenditures were $2.1 million in the first quarter of fiscal 2022 compared with $7.7 million in the prior-year quarter.

Guidance

Triumph Group provided its financial guidance for fiscal 2022. The company expects to generate adjusted earnings per share in the range of 41-61 cents per share. The Zacks Consensus Estimate for earnings, pegged at 62 cents, lies above the guidance range.

The company expects to record net sales of $1.5-$1.6 billion in fiscal 2022. The Zacks Consensus Estimate for revenues of $1.57 billion lies above the mid-point of the guidance range.

Zacks Rank

Triumph Group currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Defense Releases

Curtiss-Wright CW reported second-quarter 2021 adjusted earnings of $1.56 per share, which surpassed the Zacks Consensus Estimate of $1.53 by 2%.

Raytheon Technologies’ RTX second-quarter 2021 adjusted earnings per share of $1.23 outpaced the Zacks Consensus Estimate of 92 cents by 33.7%.

Hexcel Corporation HXL reported second-quarter 2021 adjusted earnings of 8 cents per share, which surpassed the Zacks Consensus Estimate of a penny.


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