Triumph Group Stock Plunges 10% As FY22 Outlook Lags Expectations, Q1 Revenue Decline - Triumph Group (NYSE:TGI)

Triumph Group Inc TGI reported a first-quarter sales decline of 19.9% year-over-year to $396.65 million, +11% Y/Y on an organic basis, which missed the consensus of $397.31 million.
Sales by segments: Systems & Support $258.41 million (+7.7% Y/Y) and Aerospace Structures $138.25 million (-43.4% Y/Y).
Adjusted EPS improved to $0.09 from $(0.15) in 1Q21, beating the consensus of $0.04.
The operating income increased to $20.83 million compared to the loss of $252.39 million a year ago, and the margin recovered to 5.3% from -51%. Adjusted operating margin expanded by 477 bps to 7.9%.
Triumph burned cash in operating activities of 149.51 million, compared to $197.53 million a year ago. Free cash flow used was $151.63 million.
Adjusted EBITDA increased to $41.02 million, compared to $17.61 million in 1Q21, and the margin expanded by 680 bps to 10.4%.
Triumph’s backlog at Q1 was at $1.9 billion.
The company, during the quarter, retired several non-recurring cash uses and is on track to complete the 747 productions later this month. They strengthened their balance sheet by reducing debt and have no substantive repayments until 2024.
FY21 Outlook: Triumph expects net sales of $1.5 billion - $1.6 billion vs. consensus estimate of $1.61 billion, GAAP EPS of ($0.15) - $0.05, and Adjusted EPS of $0.41-$0.61 vs. consensus of $0.61.
It expects cash flow used in operations of $110 million - $125 million and free cash use of $135 million - $150 million.
Price action: TGI shares plunge 10.6% at $17.62 on the last check Wednesday.

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