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Feb 28, 2021
AAR Corp Q3 2021 Earnings Report
Reported consolidated sales and income from continuing operations.
Key Takeaways
AAR CORP reported third quarter Fiscal Year 2021 consolidated sales of $410.3 million and income from continuing operations of $31.1 million, or $0.87 per diluted share. The company's adjusted diluted earnings per share from continuing operations were $0.37. Consolidated sales decreased 26% from the prior year quarter, while sales to government customers increased 4%. Gross profit margins increased from 11.8% to 21.0% due primarily to the CARES Act payroll support.
Consolidated third quarter sales decreased 26% from the prior year quarter.
Consolidated sales to commercial customers decreased 42% from the prior year quarter primarily due to the continued impact of COVID-19.
Consolidated sales to government customers increased 4% as a result of continued strong performance across global government contracts.
Gross profit margins increased from 11.8% in the prior year quarter to 21.0% in the current quarter due primarily to the CARES Act payroll support.
Forward Guidance
The company is focused on managing working capital to deliver positive cash flow generation and believes it is emerging from the pandemic with an even stronger balance sheet. They are encouraged by the early signs of a commercial market recovery and confident that their differentiated solutions will see greater demand as airline customers continue to increase their flying activity.
Positive Outlook
- The ability to maintain meaningful improvement in adjusted operating margin while in a stable revenue environment resulting from actions taken to reduce costs and increase operating efficiency.
- The ability to maintain commitment to a low cost structure and expectation for further margin expansion as revenue recovers.
- The expectation of managing working capital to deliver positive cash flow generation and that emerging from the pandemic will result in an even stronger balance sheet.
- That we are encouraged by the early signs of a commercial market recovery.
- The confidence in our belief that our differentiated solutions will see greater demand as our airline customers continue to increase their flying activity.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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