AAR CORP. has posted third-quarter fiscal year 2023 consolidated sales of US$521.1 million and income from continuing operations of US$21.8 million. For the third quarter of the prior year, the company reported sales of US$452.2 million and income from continuing operations of US$22.6 million. Adjusted diluted earnings per share from continuing operations in the third quarter of fiscal year 2023 were US$0.75, compared to US$0.63 in the third quarter of the prior year.
Subsequent to the quarter, AAR acquired Trax, a leading independent provider of aircraft MRO and fleet management software which was founded in 1999. Trax offers critical software applications to a diverse global customer base of airlines and MROs supporting approximately 5,000 aircraft. Trax’s comprehensive solutions support the entire spectrum of maintenance activities and create the system of record required by airlines and MROs. The Trax acquisition adds established, higher-margin aviation aftermarket software offerings with recurring revenue to our portfolio and provides opportunities to cross-sell products and services.
AAR reported consolidated third-quarter sales increased 15% over the prior year quarter. Consolidated sales to commercial customers increased 28% over the prior-year quarter, primarily due to further recovery in the commercial market. Consolidated sales to government customers decreased 3% due to the completion of certain government programmes which occurred last fiscal year. Sales to commercial customers were 65% of consolidated sales, compared to 59% in the prior-year quarter.
AAR’s gross profit margins were 18.1% in the current quarter, compared to 17.8% in the prior year quarter. Adjusted gross profit margin increased from 17.3% to 18.1%, primarily due to the favourable impact of our previous actions to reduce costs and improve our operating efficiency.
Selling, general and administrative expenses were US$56.7 million in the quarter, which included increased investments in digital initiatives as well as US$3.7 million related to Trax acquisition costs and a Russian bankruptcy court judgment. As a percentage of sales, selling, general, and administrative expenses were 10.9% for the quarter, compared to 10.8% last year.
AAR’s cash flow provided by operating activities from continuing operations was US$17.4 million during the current quarter. Excluding accounts receivable financing programme, cash flow provided by operating activities from continuing operations was US$17.2 million in the current quarter. (£1.00 = US$1.23 at time of publication).
