AAR Corp Q2 2022 Earnings Report
Key Takeaways
AAR CORP reported second quarter Fiscal Year 2022 consolidated sales of $436.6 million and income from continuing operations of $20.8 million, or $0.58 per diluted share. Adjusted diluted earnings per share from continuing operations were $0.53. Consolidated second quarter sales increased 8% over the prior year quarter.
Consolidated sales to commercial customers increased 33% over the prior year quarter due to the recovery in the commercial market from the impact of COVID-19.
Consolidated sales to government customers decreased 15% primarily related to the level of program activity for the modification and sale of two C-40 aircraft to the U.S. Marine Corps in the prior year quarter.
Gross profit margins increased from 17.2% in the prior year quarter to 18.0% in the current quarter.
Operating margin increased from 5.4% in the prior year quarter to 6.9% in the current quarter.
AAR Corp
AAR Corp
Forward Guidance
The company expects adjusted operating margin improvement to continue as higher margin parts activities fully recover.
Positive Outlook
- Company expects adjusted operating margin improvement to continue.
- Company's higher margin parts activities are expected to fully recover.
- Demonstrated ability to drive consistent cash flows.
- Exceptionally strong balance sheet.
- Deploying capital to fund continued growth.
Challenges Ahead
- Global recovery in commercial air travel continues to be uneven due to COVID-19 variants.
- Associated travel restrictions.
- Potential impacts from COVID-19 pandemic on air travel.
- Worldwide commercial activity.
- Ability to source parts and components.