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Astronics Q4 beats Street, outlook in line with estimates

6th Feb 2012, 12:21 pm by Olivia D'Orazio
Astronics Q4 beats Street, outlook in line with estimates

Astronics (NASDAQ:ATRO) saw its stock rise on Monday, as its fourth quarter results beat estimates, and its 2012 sales forecast met Street views.

For the full year 2012, the maker of test systems for military applications said it expects to record sales in the range of $235 million and $250 million. Sales from its aerospace segment are expected between $225 million and $238 million, while sales from its test systems segment are expected in the range of $10 million to $12 million.

Analysts polled by Bloomberg Businessweek are expecting $245 million in revenues for full-year 2012.

For the fourth quarter ended December 31, the company posted earnings of $5.2 million, or $0.40 per share, up 16 percent from $4.5 million, or $0.35 per share, a year ago.

Adjusted for a $2.5 million, or $0.12 per share, charge related to the impairment of goodwill and intangible assets related to its test systems business, earnings rose to $0.52 per share, beating analysts' 41-cents per share estimate.

Sales for the period rose to $61.2 million, up 18 percent over the $51.8 million it posted a year ago, and up over the $55.6 million that analysts were expecting.

Gross profit margins widened to 28.4 percent, from 24.0 percent in the same period last year.

Astronics president and CEO, Peter J. Gundermann said: "The fourth quarter was a good one in many ways.

"We again achieved record revenue, margins were strong, orders were brisk, and we acquired Ballard, a leading designer and producer of avionics databus solutions for the aerospace industry.

"However, we had our share of disappointments during the quarter as well.

"We learned recently that the United States Air Force decided to cancel the VDATS procurement, which contributed to the $2.5 million write-down of goodwill and intangible assets in our test systems business.

"Additionally, the bankruptcy filing of American Airlines led to a $500,000 receivable reserve."

Total sales from its aerospace segment increased 24.5 percent to $58.2 million, on high demand for cabin electronics and aircraft lighting productions under its commercial transportation business. Slightly higher business jet sales and flat military sales helped offset lower revenues from the company's FAA/airport business.

Revenues from its test systems business rose 18 percent to $61.2 million, despite a 41.9 percent decline in revenues from military applications. Astronics said the decline in military sales is directly related to the US Air Force's decision to cancel its VDATS program. The company said it expected this program to be a big part of its operating activities in 2012.

The program loss contributed to the company's large write-down.

Still, total bookings during the quarter rose 36 percent to $56.6 million. Bookings under its aerospace division rose 34 percent to $54.0 million, while its test systems segment posted $2.5 million in bookings, more than double from a year earlier.

For the full year fiscal 2011, earnings rose 44 percent to $21.6 million, or $1.67 per share, while sales hiked 17 percent to $228.2 million.

Backlog at the year's end rose seven percent to $106.3 million in total, including $97.9 million from the aerospace division, up seven percent, and $8.4 million from its test systems segment, a two percent rise.

On the Nasdaq Exchange, shares of the East Aurora, New York-based company rose 7.36 percent to $35.87, as of 11:59 am EDT.

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