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Aug 31, 2021
AAR Corp Q1 2022 Earnings Report
AAR Corp reported an increase in sales and income from continuing operations compared to the prior year, driven by recovery in the commercial market and cost reduction efforts.
Key Takeaways
AAR Corp's Q1 2022 consolidated sales increased by 14% to $455.1 million, with income from continuing operations at $11.2 million, or $0.31 per diluted share. Adjusted diluted earnings per share were $0.52, compared to $0.17 in the prior year. The company benefited from a 53% increase in sales to commercial customers and improved gross profit margins.
Consolidated sales increased by 14% compared to the prior year quarter.
Sales to commercial customers increased by 53% due to recovery in the commercial market.
Adjusted diluted earnings per share from continuing operations were $0.52, up from $0.17 in the prior year.
Gross profit margins increased to 14.2% from 12.1% due to cost reduction and efficiency improvements.
Forward Guidance
While the U.S. exit from Afghanistan will impact the government business in the near term, the company is encouraged by the strong pipeline of offsetting government opportunities and expects continued growth and operating margin expansion in commercial markets as demand increases.
Positive Outlook
- Strong pipeline of offsetting government opportunities.
- Expect continued growth in commercial markets.
- Expect operating margin expansion in commercial markets.
- Continued focus on driving operating efficiency.
- Continued focus on working capital management.
Challenges Ahead
- U.S. exit from Afghanistan will impact government business in the near term.
- Timing of the recovery has been impacted by the Delta variant.
- Potential impact of the COVID-19 pandemic on air travel.
- Worldwide commercial activity and our and our customers’ ability to source parts and components.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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