Triumph (TGI) Tops Q4 Earnings & Revenues, Gives FY18 View

Triumph Group Inc.’s (NYSE:TGI) adjusted earnings from continuing operations in fourth-quarter fiscal 2017 (ended Mar 31, 2017) came in at $3.09 per share, beating the Zacks Consensus Estimate of $1.60 by 93.1%. Reported earnings also improved a massive 134.1% from $1.32 per share a year ago.

For the full fiscal year 2017, the company’s adjusted earnings per share came in at $6.54, which exceeded the Zacks Consensus Estimate of $4.66 by 40.3%. The full year bottom-line figure also increased 21.8% from $5.37 per share a year ago.

Total Revenue

In the reported quarter, net sales were $919.9 million, beating the Zacks Consensus Estimate of $916 million by 0.5%. The top line, however, declined 13% year over year.

For the full fiscal year 2017, the company's revenues came in at $3.53 billion, missing the Zacks Consensus Estimate of $3.54 billion by a whisker.

Organic sales in the quarter were down 13% primarily due to rate reductions on key Aerospace structures programs, changes in model mix, reduced volume in military end market and foreign exchange rates.

Operational Highlights

In fourth-quarter fiscal 2017, the company’s operating loss was $115.5 million, narrower than the loss of $1.18 billion in the year-ago quarter.

Quarterly Segment Performance

Aerospace Structures: Segment sales were $338.8 million, down 20% from $423.6 million in the year-ago quarter. Operating loss for the segment was $166.7 million, narrower than the loss of $1.22 billion in the year-ago quarter.

Integrated Systems: Segment sales dipped 6.8% year over year to $282 million. Operating income was $55.9 million, down from the year-ago level of $66.7 million.

Precision Components: Segment revenues declined 11.7% to $247.6 million in the reported quarter. However, the segment reported an operating income of $11.1 million compared with $1.3 million in the prior-year quarter.

Product Support: Segment sales dropped 4.4% year over year to $81 million in the reported quarter. Operating income was $12.8 million in the fiscal fourth quarter against the year-ago quarter’s loss of $6.5 million.

Financial Position

As of Mar 31, 2017, Triumph’s cash and cash equivalents were $69.6 million compared with $20.9 million as of Mar 31, 2016. As of Mar 31, 2017, long-term debt (excluding current portion) was $1.04 billion compared with $1.37 million as of Mar 31, 2016.

Cash flow from operations during the quarter was $454 million. The company spent $18.7 million as capital expenditure in the quarter.

Guidance

Based on anticipated aircraft production rates and divestitures completed in fiscal 2017, Triumph Group projects revenues for fiscal 2018 in the range of $3.1–$3.2 billion. It also expects revenues to increase in fiscal year 2019 as development programs enter into production and sales from new wins offset sunsetting programs.

Peer Releases

Raytheon Company (NYSE:RTN) reported first-quarter 2017 adjusted earnings from continuing operations of $1.73 per share, beating the Zacks Consensus Estimate by 7.5%. The company’s first-quarter revenues of $6,000 million also surpassed the Zacks Consensus Estimate by 2.7%.

Rockwell Collins Inc.’s (NYSE:COL) second-quarter fiscal 2017 (ended Mar 31, 2017) adjusted earnings per share of $1.34 surpassed the Zacks Consensus Estimate by 2.3%. Total sales were $1,342 million, beat the Zacks Consensus Estimate by 0.9%.

AAR Corp. (NYSE:AIR) reported third-quarter fiscal 2017 earnings of 38 cents per share, which were in line with the Zacks Consensus Estimate. Net sales came in at $446.7 million, which beat the Zacks Consensus Estimate by 5.8%.

Zacks Rank

Triumph Group currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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