Illinois-headquartered MRO provider AAR Corp. more than doubled its operating profit for the third quarter of its fiscal year as sales rocketed in its repairs and engineering segment and more airframe overhauls were performed.
Despite its $71 million operating profit, the company recorded a small net loss for the three months to Feb. 28 as it took a $64 million charge in relation to the sale of its landing gear overhaul business. The $51 million sale is expected to complete in the fourth quarter.
AAR CEO John Holmes highlighted the company's margin growth during the quarter due to efficiency initiatives and also noted that business had remained strong after the reporting period.
“Subsequent to the quarter, we announced several new business wins, including signing an exclusive agreement with Chromalloy to distribute their BELAC [Pratt & Whitney] PW4000 PMA [parts manufacturer approval] parts,” said Holmes. “We also added distribution support for select Unison parts under our Supplier Capabilities Contract with Defense Logistics Agency.”
Total sales climbed 20% year on year and Homes said he expects that to continue as demand for aftermarket services remains strong.
Within AAR, parts supply contributed $271 million of revenue, followed by repair and engineering ($216 million), integrated solutions ($163 million) and expeditionary services ($29 million). At $45 million, parts supply generated more operating income than the other three segments combined in the third quarter.
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