Printer Friendly

AAR ANTICIPATES THIRD QUARTER RESULTS AND RESTRUCTURING CHARGE

 ELK GROVE VILLAGE, Ill., March 10 /PRNewswire/ -- AAR Corp. (NYSE: AIR) today announced that it expects to report a net loss of approximately $5,700,000, or $.36 per share, including a noncash, pretax restructuring charge of $11,000,000 for its third quarter ended Feb. 28, 1993. Net sales for the period are expected to be approximately $83,000,000. The restructuring charge includes a writedown of certain inventories to reflect the impact of market conditions. Net income for the third quarter of the prior fiscal year was $2,880,000, or $.18 per share, on net sales of $104,920,000.
 Net income from operations for the quarter, excluding the charge, is expected to be approximately $200,000, or $.01 per share, primarily due to lower sales volumes across the company's business activities. Results benefited from a reduction in income tax expense of $1,200,000 from the reversal of income tax liabilities no longer required.
 Ira A. Eichner, chairman of the board and chief executive officer of AAR, commented, "It is interesting to note that our third quarter started strong. Sales in trading activities were up. Our overhaul operations were experiencing improvement and we expected a major government contract for manufactured goods during the month of December. And, we were aggressively dealing with difficulties at our floor maintenance equipment unit.
 "However," Eichner said, "during the month of February, sales slowed significantly in certain areas of our trading business. The loss and delay of sales of larger components, particularly engines, exacerbated the impact on earnings, even while gross margins improved. Sales in overhaul operations were not as brisk as anticipated, and delay of expected contracts for the manufacture and repair of products for the government's rapid deployment program precluded planned shipments in the quarter. And, while performance at the floor maintenance equipment unit showed improvement over the second quarter, the unit incurred a loss."
 Eichner continued, "On the brighter side, late in February we were awarded the delayed government contracts. Their value, including an option, is approximately $45 million with shipments to be made over the next 18 to 24 months. Also in late February, we signed a five-year, multimillion-dollar inventory management contract with Lufthansa German Airlines for parts support of its engine maintenance operations."
 Addressing the noncash charge, Eichner stated, "Very recent changes in market conditions precipitated a charge at this time, for inventory and other restructuring costs incurred to improve our competitive position and allow us to better respond to customer requirements."
 Eichner ended by saying, "Despite the disappointing third quarter results, we generated positive cash flow, reduced debt and maintained a 26 percent long-term debt to capital ratio, well within our targeted range. While substantial improvement in our core businesses is tied to recovery in major world economies, and the airline/aerospace industry in particular, we are poised and ready to move forward with a solid balance sheet and an experienced team."
 The company expects release of its third quarter results on or about March 18, 1993.
 AAR Corp., traded on the New York Stock Exchange under the symbol AIR, is a leading supplier of aerospace/aviation products and services. The company primarily supplies parts and equipment, performs technical services, and manufactures proprietary products for the aviation industry in the United States and abroad.
 -0- 3/10/93
 /CONTACT: Office of the Chairman of AAR Corp., 708-439-3939/
 (AIR)


CO: AAR Corp. ST: Illinois IN: AIR SU: ERP

WB -- NY027 -- 8534 03/10/93 10:52 EST
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Mar 10, 1993
Words:581
Previous Article:GYNEX PHARMACEUTICALS AND BIO-TECHNOLOGY GENERAL AGREE TO MERGE
Next Article:GERALD A. ISOM TO HEAD CIGNA CORPORATION'S DOMESTIC PROPERTY AND CASUALTY OPERATIONS
Topics:


Related Articles
AAR ANNOUNCES RESULTS FOR SECOND QUARTER
AAR REPORTS THIRD QUARTER RESULTS
AAR TO TAKE A CHARGE RELATED TO DOWNSIZING OF AIRFRAME MAINTENANCE OPERATION
AAR RELEASES PRELIMINARY RESULTS FOR FISCAL 1992
AAR CONFIRMS PREVIOUSLY ANNOUNCED THIRD QUARTER RESULTS
AAR ANNOUNCES THIRD QUARTER RESULTS
AAR EARNINGS UP 30 PERCENT ON RECORD QUARTERLY SALES
AAR SECOND QUARTER NET INCOME UP 79 PERCENT (In thousands except per share data)
AAR EXPECTS STRONG EARNINGS INCREASE ON RECORD THIRD QUARTER SALES
AAR THIRD QUARTER EARNINGS UP SHARPLY ON RECORD SALES

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters