On Thursday, provider of services and products to the commercial aviation and government and defense markets, AAR Corporation (NYSE: AIR) announced positive fiscal first quarter earnings beating analysts’ expectations. The company reported EPS of $0.29 on revenues of $404.8 million, beating consensus estimates of EPS of $0.26 on revenues of $398.35 million.
The Company operates in two segments: Aviation Services, which consists of supply chain and maintenance, repair and overhaul (MRO) activities, and Expeditionary Services, which includes airlift and mobility activities.
"Our Aviation Services segment delivered strong results once again as sales in the first quarter grew 6% from last year to $334.6 million, contributing to improved margins. Our supply chain business continued to exhibit very good performance in the period," said David P. Storch, Chairman, President, and Chief Executive Officer of AAR CORP.
Recent government contract awards contributed to sales growth in Aviation Services. Sales to commercial customers increased from improved demand for aftermarket parts trading and the ramp up of new distribution contracts. We also announced several new commercial contracts during the quarter for our programs business.
Storch continued, "We are very pleased with the award from the Department of State Air Wing (INL/A) to provide maintenance, logistics, and operations services under the Global Aviation Support Services contract. The potential duration of this contract is eleven years, including a 6 month phase-in. The incumbent contractor filed a protest on September 11, 2016 and we expect a final decision on the protest no later than December 21, 2016."