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Diversified Holding Company Air T, Inc. FY 2018 Revenue Rose 31% to $194.5M and FY 2018 EPS Improved to $1.11

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Diversified Holding Company Air T, Inc. FY 2018 Revenue Rose 31% to $194.5M and FY 2018 EPS Improved to $1.11

PR Newswire

DENVER, N.C., June 29, 2018 /PRNewswire/ -- Air T, Inc. (NASDAQ:AIRT) is organized as a powerful portfolio of businesses and financial assets, each of which is independent yet interrelated. These include overnight air cargo operations, ground support equipment manufacturing and local maintenance services, and commercial aircraft asset management and logistics.  Today the Company is reporting improved financial performance for its fiscal year-ended March 31, 2018.

FY 2018 Overview

  • Revenues rose to $194.5 million for the fiscal year ended March 31, 2018, a 31% increase over the prior year
  • Operating income rose to $4.2 million, as compared to prior-year operating loss of $3.1 million
  • Net income attributable to Air T stockholders rose to $2.3 million versus a net loss of $3.2 million in fiscal 2017
  • Diluted earnings per share increased to $1.11 compared to last year's loss per share of $1.51

Air T, Inc. Chairman and CEO Nick Swenson, said: "Our fiscal 2018 operating results reflect the outstanding performance of our business leaders and employees, as well as new acquisitions. Together they delivered top line growth coupled with improvements to bottom line performance, particularly after adjusting for audit expenses and investments in our corporate infrastructure. We are looking forward to steady growth in fiscal 2019. We continuously evaluate acquisitions and investments that will add to our portfolio of powerful businesses. Our investments must represent claims on growing free cash flows or discounts to intrinsic value. Yet people understand that enterprising and dynamic individuals and teams are at the heart of our corporate strategy. A large part of our job is making room for excellent leaders and applying resources as they move their organizations forward. The more we make sound decisions at the relevant level, the more we will continue to do better."

Business Segment Results

Aviation Ground Support Equipment

  • Revenues for this segment, which is comprised of Global Ground Support Services, the world's largest manufacturer of aircraft de-icing equipment, totaled $50.0 million for the fiscal year ended March 31, 2018. This represents an increase of 59% over the revenue of $31.4 million in the prior year. The revenue increase reflected higher sales of de-icing and catering trucks to large and long-standing customers.
  • The segment entered fiscal 2019 on a strong footing with a sales backlog of $13.3 million compared to $2.8 million a year-ago.

Overnight Air Cargo

  • Revenues for this segment, comprised of Mountain Air Cargo and CSA Air, rose 5% to $72.8 million in fiscal 2018 compared to $69.6 million in the prior fiscal year.
  • The revenue increase was primarily due to higher administrative fees from FedEx as a result of an incremental aircraft lease arrangement and to cover certain operational costs, principally flight crew costs.
  • Segment maintenance revenues also increased due to increased scheduled aircraft maintenance in fiscal 2018 compared to the prior year.

Aviation Ground Support Maintenance Services

  • Revenue from this segment, comprised of Global Aviation Services, one of the fastest growing ground support maintenance providers in the U.S., offering maintenance services at 88 airports, totaled $35.7 million in fiscal 2018, a 17% over fiscal 2017.
  • The revenue increase is due to growth in services to existing customers as well as an increase in new customer contracts.

Commercial Jet Engines and Parts

  • This segment provides surplus and aftermarket commercial jet engine parts, airframes, avionics, other aircraft parts and logistics to the aviation industry. The three companies in this segment are Contrail, Jet Yard and AirCo. Contrail and Jet Yard were acquired in July 2016 and October 2016, respectively, while AirCo was acquired in May 2017.
  • Revenues from this segment totaled $29.5 million in fiscal 2018, an increase of 296% over fiscal 2017 revenue of $7.5 million. This increase is due to higher volume sales at Contrail as well as full year ownership of Contrail and Jet Yard in fiscal 2018, and the acquisition of AirCo in the current year.
  • The assets of Worthington Aviation, an aftermarket airframe parts and logistics company focused on the turbo prop and regional jet markets, were acquired in May 2018 and will be included in the commercial jet engine and parts segment starting in the first quarter of fiscal 2019.

Other Investments and Financial Liquidity

  • Air T owned approximately 3.4 million shares of common stock of Insignia Systems, Inc. (NASDAQ:ISIG) with a market value of $5.3 million as of March 31, 2018
  • Air T owned approximately 0.5 million shares of common stock of Oxbridge Re Holdings Limited (NASDAQ:OXBR) with a market value of $1.0 million as of March 31, 2018
  • Working capital as of March 31, 2018 totaled $30.5 million and there were zero borrowings under the Company's $10 million revolving credit facility.

ABOUT AIR T, INC.
Established in 1980, Air T Inc. is a powerful portfolio of businesses and financial assets, each of which is independent yet interrelated. Its four core segments are: overnight air cargo, aviation ground support equipment manufacturing, aviation ground support maintenance services, and commercial aircraft asset management and logistics. Our ownership interests are designed to expand, strengthen and diversify Air T's cash earnings power.  Our goal is to build on Air T's core businesses, and when appropriate, to expand into adjacent and other industries that we believe fit into the Air T portfolio.  For more information, visit www.airt.net.

FORWARD-LOOKING STATEMENTS
Statements in this press release, which contain more than historical information, may be considered forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995), which are subject to risks and uncertainties. Actual results may differ materially from those expressed in the forward-looking statements because of important potential risks and uncertainties, including, but not limited to, the risk that contracts with major customers will be terminated or not extended, future economic conditions and their impact on the Company's customers, the Company's ability to recover on its investments, including its investments in Delphax and other recently acquired companies, the timing and amounts of future orders under the Company's Global Ground Support subsidiary's contract with the United States Air Force, and risks and uncertainties related to business acquisitions, including the ability to successfully achieve the anticipated benefits of the acquisitions, inflation rates, competition, changes in technology or government regulation, information technology disruptions, and the impact of future terrorist activities in the United States and abroad. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. The Company is under no obligation, and it expressly disclaims any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

 

 

AIR T, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (LOSS)







Year Ended March 31,






2018


2017

Operating Revenues:







Overnight air cargo



$             72,845,353


$            69,558,334


Ground equipment sales



50,004,507


31,447,408


Ground support services



35,698,171


30,453,246


Commercial jet engines and parts



29,506,873


7,455,797


Printing equipment and maintenance



6,144,403


9,019,155


Corporate



182,722


-


Leasing



137,316


537,719






194,519,345


148,471,659









Operating Expenses:







Overnight air cargo



63,049,619


61,661,072


Ground equipment sales



41,567,109


24,350,264


Ground support services



30,135,613


25,089,412


Printing equipment and maintenance



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