Astronics Corporation Reports 2014 First Quarter Results

Astronics Corporation Reports 2014 First Quarter Results

  *Record quarterly sales of $141.0 million, up 90.6% from 2013 first quarter

  *Organic sales of $82.1 million, up 11.0% from 2013 first quarter

  *Completed acquisition of Astronics Test Systems ("ATS") on February 28,
    2014

  *Raises 2014 full year sales forecast to range of $625 million to $660
    million

EAST AURORA, N.Y., May 7, 2014 (GLOBE NEWSWIRE) -- Astronics Corporation
(Nasdaq:ATRO), a leading provider of advanced technologies for the global
aerospace and defense industries, today reported financial results for the
three months ended March 29, 2014.

                       Three Months Ended
                       March 29, March 30, %
                        2014      2013      Change
                                         
Sales                   $ 140,951 $ 73,967  90.6%
Gross profit            $ 30,005  $ 20,219  48.4%
Gross profit percentage 21.3%     27.3%     
SG&A                    $ 16,378  $ 9,157   78.9%
SG&A percent to sales   11.6%     12.4%     
Income from Operations  $ 13,627  $ 11,062  23.2%
Operating margin %      9.7%      15.0%     
Net Income              $ 7,507   $ 8,564   (12.3)%
Net Income %            5.3%      11.6%     

Peter J. Gundermann, President and Chief Executive Officer, commented, "Our
first quarter results were strong, reflecting solid conditions in the
industry, double digit organic growth and positive contributions from our
recent acquisitions. Results are especially notable when one considers that we
incurred about $8.7 million of fair value inventory step-up expense relating
to acquisition accounting during the quarter.Our acquisitions, including
Astronics Test Systems which we acquired in February, are performing
collectively to plan and have helped us get off to a great start for 2014."

Consolidated Review

First Quarter 2014 Results

Consolidated sales for the first quarter of 2014 increased by 90.6% to $141.0
million compared with $74.0 million for the same period last year. Aerospace
sales increased by $50.7 million and Test Systems sales increased by $16.3
million. From July 2013 through the end of the 2014 first quarter, Astronics
completed four business acquisitions, three in its Aerospace segment and one
in the Test Systems segment. Acquisitions contributed $58.8 million to
consolidated sales, while organic sales increased $8.2 million, or 11.0%.

Consolidated gross margin was 21.3% in the first quarter of 2014 compared with
27.3% in the first quarter of 2013.Margin leverage achieved from increased
organic sales volume was more than offset by costs of approximately $8.7
million relating to the fair value step-up of inventory from acquired
businesses and increased engineering and development ("E&D") costs in
Astronics organic businesses of approximately $1.2 million.Total E&D costs
were $17.3 million in the first quarter of 2014 including $3.2 million for
businesses acquired since the first quarter of 2013. Last year's first
quarter had $12.8 million in E&D expense.

Selling, general and administrative ("SG&A") expenses were approximately $16.4
million, or 11.6% of sales in the first quarter of 2014 compared with $9.2
million, or 12.4% of sales in the same period last year. The increase was due
primarily to the incremental SG&A costs of acquired businesses, which added
approximately $7.0 million to SG&A in the first quarter of 2014 when compared
with the prior year first quarter.

Diluted earnings per share for the 2014 first quarter were $0.40 compared with
$0.47 in the prior year period.This includes the impact of fair value
inventory step-up charges for inventory of acquired businesses, which totaled
approximately $8.7 million before taxes, or approximately $0.30 per diluted
share after tax in the first quarter of 2014.

Earnings per share for all periods presented have been calculated reflecting
the effect of the one-for-five Class B share distribution for shareholders of
record on October 10, 2013.

Aerospace Segment Review (refer to sales by market and segment data in
accompanying tables)

Aerospace First Quarter 2014 Results

Aerospace segment sales increased by $50.7 million, or 70.7%, compared with
the prior year's first quarter. Organic sales grew 12.6%, or $9.1 million,
and sales from acquired businesses added $41.6 million. Sales to the
Commercial Transport market increased due primarily to the sales contributed
by the acquired businesses of approximately $35.6 million. Additionally,
sales of Electrical Power & Motion products excluding acquired businesses
increased approximately $12.1 million as global demand for passenger power
systems continued to be strong.Military sales were up slightly when compared
with the prior year's first quarter as sales contributed by the acquired
businesses added $1.0 million and was partially offset by lower organic sales
to the Military market.Sales to the Business Jet market were up when compared
with last year's first quarter due primarily to the sales contribution from
acquired businesses of $2.7 million which was partially offset by a decrease
of organic sales of $1.5 million as Lighting & Safety and Electrical Power &
Motion sales both decreased slightly. The increase in first quarter Other
sales was due primarily to sales from the acquired businesses of approximately
$2.3 million partially offset by decreased organic Other sales of $1.4
million.

Aerospace operating profit for the first quarter of 2014 was $17.5 million, or
14.3% of sales, compared with $14.3 million, or 19.9% of sales, in the same
period last year.The margin leverage achieved from increased organic sales
volume was offset by increased depreciation and amortization expense of $2.8
million and increased organic E&D costs of approximately $1.3 million.
Additionally, cost of products sold was approximately $2.4 million greater
due to the lower margins recognized from the sale of inventory written up to
fair value at the time of acquisition for the acquired businesses. Aerospace
SG&A expense increased $5.7 million in 2014 as compared with 2013.The
increase was due to the incremental SG&A for the acquired businesses.

Test Systems Segment Review (refer to sales by market and segment data in
accompanying tables)

Test Systems First Quarter 2014 Results

Sales in the 2014 first quarter increased approximately $16.3 million to $18.6
million when compared with sales of $2.3 million for the same period in 2013,
due primarily to the incremental sales to both the Commercial Electronics and
Military markets that was provided by the acquisition of ATS on February 28,
2014. ATS contributed $17.2 million in sales which was partially offset by
decreased sales of our organic Test Systems business of approximately $0.9
million.

Test Systems operating loss for the first quarter of 2014 was $1.7 million
compared with an operating loss of $1.5 million in the same period last year.
The operating loss in the first quarter of 2014 includes $6.3 million in cost
of products sold that is related to the fair value step-up of inventory from
acquired businesses. Depreciation and amortization expense relating to the
acquisition was $0.2 million in the first quarter of 2014.

Balance Sheet

Cash at the end of the first quarter of 2014 was $29.1 million compared with
$54.6 million at December 31, 2013. Cash provided by operating activities in
the first quarter of 2014 was approximately $2.6 million. 

Cash used for investing activities was $87.2 million.This included $14.9
million for the purchase and modifications of a new building in Oregon and the
acquisition of ATS for $70.3 million. The Company expects capital spending in
2014 to be in the range of $33 million to $37 million, including the purchase
and modifications of the new Oregon building.

Outlook

On March 31, 2014, backlog was a record $362.4 million, improved from $214.2
million at the end of the trailing fourth quarter of 2013 and $119.0 million
at the end of the first quarter of 2013.Approximately $324.1 million of this
backlog is expected to ship over the balance of 2014.

The Company has raised its expectations for 2014 revenue to be in the range of
$625 million to $660 million from its previous expectation of $585 million to
$640 million.Astronics anticipates that approximately $480 million to $505
million of forecasted 2014 revenue will be from its Aerospace segment, while
approximately $145 million to $155 million of the forecasted revenue will be
from its Test Systems segment.

Mr. Gundermann concluded, "We had record bookings in the first quarter of $146
million, an increase of 34% over our previous high.This gave us a record
backlog as we entered the second quarter and put us in a good position to
execute our plan for the remainder of the year.

The midpoint of our new range for 2014 would suggest revenue increasing almost
90% over last year, which would obviously be a very strong year for our
company."

First Quarter 2014 Webcast and Conference Call

The Company will host a teleconference at 11:00 AM ET.During the
teleconference, Peter J. Gundermann, President and CEO, and David C. Burney,
Executive Vice President and CFO, will review the financial and operating
results for the period and discuss Astronics' corporate strategy and
outlook.A question-and-answer session will follow.

The Astronics conference call can be accessed by calling (201) 689-8562. The
listen-only audio webcast can be monitored at www.astronics.com.To listen to
the archived call, dial (858) 384-5517 and enter conference ID number
13580034. The telephonic replay will be available from 2:00 p.m. on the day
of the call through Wednesday, May 14, 2014. A transcript will also be posted
to the Company's Web site, once available.

About Astronics Corporation

Astronics Corporation is a leader in advanced, high-performance lighting,
electrical power and automated test systems for the global aerospace and
defense industries.Astronics' strategy is to develop and maintain positions
of technical leadership in its chosen aerospace and defense markets, to
leverage those positions to grow the amount of content and volume of product
it sells to those markets and to selectively acquire businesses with similar
technical capabilities that could benefit from our leadership position and
strategic direction.Astronics Corporation, and its wholly-owned subsidiaries,
Astronics Advanced Electronic Systems Corp., Astronics AeroSat Corporation,
Astronics Test Systems, Inc., Ballard Technology, Inc., DME Corporation,
Luminescent Systems Inc., Luminescent Systems Canada, Inc., Max-Viz, Inc.,
Peco, Inc. and PGA Electronic s.a. have a reputation for high-quality designs,
exceptional responsiveness, strong brand recognition and best-in-class
manufacturing practices.The Company routinely posts news and other important
information on its Web site at www.astronics.com.

For more information on Astronics and its products, visit its Web site at
www.astronics.com.

Safe Harbor Statement

This news release contains forward-looking statements as defined by the
Securities Exchange Act of 1934.One can identify these forward-looking
statements by the use of the words "expect," "anticipate," "plan," "may,"
"will," "estimate" or other similar expressions.Because such statements apply
to future events, they are subject to risks and uncertainties that could cause
actual results to differ materially from those contemplated by the
statements.Important factors that could cause actual results to differ
materially include the state of the aerospace and defense industries, the
market acceptance of newly developed products, internal production
capabilities, the timing of orders received, the status of customer
certification processes, the demand for and market acceptance of new or
existing aircraft which contain the Company's products, customer preferences,
and other factors which are described in filings by Astronics with the
Securities and Exchange Commission. The Company assumes no obligation to
update forward-looking information in this news release whether to reflect
changed assumptions, the occurrence of unanticipated events or changes in
future operating results, financial conditions or prospects, or otherwise.

FINANCIAL TABLES FOLLOW

                                                                      
                                                                      
      ASTRONICS CORPORATION                                            
      CONSOLIDATED INCOME STATEMENT DATA                               
      (Unaudited, $ in thousands except per share data)                
                                                                     
                                        Three Months Ended            
                                        3/29/2014      3/30/2013      
      Sales                              $140,951      $73,967       
      Cost of products sold              110,946        53,748         
      Gross profit                       30,005         20,219         
      Gross margin                       21.3%          27.3%          
                                                                    
      Selling, general and               16,378         9,157          
       administrative
      SG&A % of Sales                   11.6%          12.4%          
      Income from operations             13,627         11,062         
      Operating margin                   9.7%           15.0%          
                                                                    
      Interest expense, net              2,323          218            
      Income before tax                  11,304         10,844         
      Income tax expense                 3,797          2,280          
      Net Income                         $7,507        $8,564        
      Net income % of Sales              5.3%           11.6%          
                                                                    
                                                                    
      *Basicearnings per share          $ 0.42       $0.49         
      *Diluted earnings per share        $ 0.40       $0.47         
                                                                    
      *Weighted average diluted shares   18,877         18,211         
       outstanding (in thousands)
                                                                    
      Capital Expenditures               $ 16,906       $1,828       
      Depreciation and Amortization      $4,838        $1,749       
                                                                    
*All share quantities and per share data reported has been restated to reflect
the impact of the effect of the one-for-five Class B share distribution for
shareholders of record on October 10, 2013.



ASTRONICS CORPORATION
CONSOLIDATED BALANCE SHEET DATA
( in thousands)
                                          3/29/2014   12/31/2013
                                          (Unaudited) 
ASSETS                                                
Cash and cash equivalents                  $29,117    $54,635
Accounts receivable                        109,015     60,942
Inventories                                141,106     85,269
Other current assets                       11,473      10,352
Property, plant and equipment, net         100,883     70,900
Other long-term assets                     6,137       5,474
Intangible assets, net                     101,570     102,701
Goodwill                                   103,418     100,998
Total Assets                               $602,719   $491,271
                                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                  
Current maturities of long term debt       $13,092    $12,279
Accounts payable and accrued expenses      110,238     72,958
Long-term debt                             255,326     188,041
Other liabilities                          43,067      46,484
Shareholders' equity                       180,996     171,509
Total Liabilities and Shareholders' Equity $602,719   $491,271


ASTRONICS CORPORATION
SEGMENT DATA
(Unaudited, $ in thousands)
                              
                              Three Months Ended
                              3/29/2014 3/30/2013
Sales                                   
Aerospace                      $122,372 $71,669
                                       
Test Systems                   18,689    2,390
Less Intersegment Sales        (110)     (92)
Test Systems Sales - Net       18,579    2,298
                                       
Total Consolidated Sales       $140,951 $73,967
                                       
Operating Profitand Margins            
Aerospace                      $17,490  $14,288
                              14.3%     19.9%
Test Systems                   (1,695)   (1,525)
                              (9.1)%    (63.8)%
Total Operating Profit         15,795    12,763
                              11.2%     17.3%
                                       
Interest Expense               2,323     218
Corporate Expenses and Other   2,168     1,701
Income Before Taxes            $11,304  $10,844
Income Before Taxes % of Sales 8.0%      14.7%



ASTRONICS CORPORATION
SALES BY MARKET
(Unaudited, $ in thousands)

Three Months Ended
                         3/29/2014 3/30/2013 $ change % change 2014 YTD %
Aerospace Segment                                           
Commercial Transport      $99,287  $50,962  $48,325 94.8%    70.3%
Military                  8,958     8,616     342      4.0%     6.5%
Business Jet              9,866     8,665     1,201    13.9%    7.0%
Other                     4,261     3,426     835      24.4%    3.0%
Aerospace Total           122,372   71,669    50,703   70.7%    86.8%
                                                           
Test Systems Segment                                        
Commercial                14,337    --        14,337   100.0%   10.2%
Military                  4,242     2,298     1,944    84.6%    3.0%
Test Systems Total        18,579    2,298     16,281   708.5%   13.2%
                                                           
Total                     $ 140,951 $73,967  $66,984 90.6%    100.0%
                                                           
ASTRONICS CORPORATION
SALES BY PRODUCT
(Unaudited, $ in thousands)

Three Months Ended
                         3/29/2014 3/30/2013 $ change % change 2014 YTD %
Aerospace Segment                                           
Electrical Power & Motion $65,833  $44,796  $21,037 47.0%    46.7%
Lighting & Safety         35,091    18,117    16,974   93.7%    24.9%
Avionics                  12,752    5,330     7,422    139.2%   9.0%
Structures                3,638     --        3,638    100.0%   2.6%
Other                     5,058     3,426     1,632    47.6%    3.6%
Aerospace Total           122,372   71,669    50,703   70.7%    86.8%
                                                           
Test Systems              18,579    2,298     16,281   708.5%   13.2%
                                                           
Total                     $ 140,951 $ 73,967  $66,984 90.6%    100.0%



ASTRONICS CORPORATION
ORDER AND BACKLOG TREND
(Unaudited, $ in thousands)

                                                              
                  Q2          Q3          Q4           Q1          Trailing
                 2013        2013        2013         2014        Twelve
                                                                   Months
                 6/29/2013   9/28/2013   12/31/2013   3/29/2014   3/29/2014
Sales                                                          
Aerospace         $ 68,676    $ 87,525    $ 102,660    $ 122,372   $ 381,233
Test Systems      2,157       2,156       2,796        18,579      24,688
Total Sales       $ 70,833    $ 89,681    $ 105,456    $ 140,951   $ 405,921
                                                              
Bookings                                                       
Aerospace         $ 65,714    $ 95,852    $ 107,633    $ 123,578   $ 392,777
Test Systems      620         8,066       1,127        22,677      32,490
Total Bookings    $ 66,334    $ 103,918   $ 108,760    $ 146,255   $ 425,267
                                                              
Backlog*                                                       
Aerospace         $ 111,674   $ 159,468   $ 207,101    $ 208,307   N/A
Test Systems      2,822       8,731       7,062        154,095     N/A
Total Backlog     $ 114,496   $ 168,199   $ 214,163    $ 362,402   N/A
                                                              
Book:Bill Ratio                                                
Aerospace         0.96        1.10        1.05         1.01        1.03
Test Systems      0.29        3.74        0.40         1.22        1.26
Total Book:Bill   0.94        1.16        1.03         1.04        1.05
                                                              
* During the third quarter of 2013, acquisitions added backlog of
approximately $39.5 million for the Aerospace segment.
During the fourth quarter of 2013, acquisitions added backlog of approximately
$42.6 million for the Aerospace segment.
During the first quarter of 2014, acquisitions added backlog of approximately
$142.9 million for the Test Systems segment.

CONTACT: Company:
         David C. Burney, Chief Financial Officer
         Phone: (716) 805-1599, ext. 159
         Email: david.burney@astronics.com
        
         Investor Relations:
         Deborah K. Pawlowski, Kei Advisors LLC
         Phone: (716) 843-3908
         Email: dpawlowski@keiadvisors.com

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