VSE Corp (VSEC) Reports 38.2% Increase in Q3 2023 Revenues and 57.3% Rise in Net Income
VSE Corp (NASDAQ:VSEC) announced Q3 2023 results with total revenues of $231.4 million, a 38.2% increase compared to Q3 2022.
GAAP Net Income of $12.1 million increased 57.3% while GAAP EPS (Diluted) of $0.80 increased 33.3%.
Adjusted EBITDA of $32.3 million increased 55.6% and Adjusted Net Income of $13.8 million increased 74.6%.
The Aviation segment reported record financial performance with revenue growth of 48% year-over-year to a record $152.4 million.
On November 1, 2023, VSE Corp (NASDAQ:VSEC), a leading provider of aftermarket distribution and maintenance, repair and overhaul (MRO) services for air and land transportation assets for commercial and government markets, announced its Q3 2023 results. The company reported total revenues of $231.4 million, a 38.2% increase compared to Q3 2022. GAAP Net Income of $12.1 million increased 57.3% and GAAP EPS (Diluted) of $0.80 increased 33.3%. Adjusted EBITDA of $32.3 million increased 55.6% and Adjusted Net Income of $13.8 million increased 74.6%.
Management Commentary
John Cuomo, President and CEO of VSE Corporation, commented on the results,
Third quarter results reflected record financial performance in our Aviation segment and continued progress and disciplined revenue growth and customer diversification in our Fleet segment,
He further added,
We delivered our fourth consecutive quarter of record revenue and profit in our Aviation segment, driven by strong program execution, continued market share gains, expansion of our product lines and service capabilities, and robust end-market activity. In our Fleet segment, we continue to grow and scale our commercial business with contributions from our newly opened Memphis distribution center of excellence, all while continuing to grow and support legacy fleets and customers.
Strategic Updates and Financial Resources
VSE Corp (NASDAQ:VSEC) made significant strategic moves in Q3 2023, including the acquisition of Honeywell Fuel Control Systems License Agreement and Desser Aerospace. The company also announced a mutual agreement to terminate the sale of the Federal and Defense segment to Bernhard Capital Partners Management LP. In terms of financial resources, the company had $89 million in cash and unused commitment availability under its $350 million revolving credit facility maturing in 2025. As of September 30, 2023, VSE had total net debt outstanding of $440 million.
Segment Results
The Aviation segment revenue increased 48% year-over-year to a record $152.4 million in the third quarter 2023. The Fleet segment revenue increased 22% year-over-year to $79.0 million in the third quarter 2023. The company also reported $4.7 million and $10.8 million of total capital expenditures for three and nine months ended September 30, 2023, respectively.
Guidance
VSE increased its full year 2023 revenue growth and its Adjusted EBITDA margin guidance for its Aviation segment, reaffirmed its revenue growth and Adjusted EBITDA margin guidance for its Fleet segment, and expects positive free cash flow to accelerate in the fourth quarter.
Explore the complete 8-K earnings release (here) from VSE Corp for further details.
This article first appeared on GuruFocus.
