On Tuesday, AAR (NYSE: AIR) reported its fourth-quarter results after market close.
The quarter adjusted earnings per share for the quarter were $1.53, surpassing analyst expectations of $1.38.
Revenue for the quarter reached $928.00 million, exceeding analyst estimates of $868.54 million. Earnings increased by 31.9 percent, while revenue rose by 23.0 percent compared to a year earlier.
In the fourth quarter, adjusted operating margin increased slightly to 10.6 percent from 10.5 percent and adjusted EBITDA margin also rose from 12.4 percent to 12.5 percent.
The Parts Supply, RE&S, and Government Solutions segments combined for a total adjusted EBITDA margin of 13.0 percent.
For the full fiscal year 2026, consolidated sales were $3.3 billion, marking a 19 percent increase over the previous year, while adjusted diluted earnings per share were $5.05, compared to $3.91 last year. Adjusted EBITDA for the year was $401 million, up 24 percent.
Looking ahead, AAR projects first-quarter fiscal year 2027 sales between $894.92 million and $909.71 million, compared to analyst estimates of $874.35 million.
Sales growth for the first quarter is expected to be between 21 percent and 23 percent, excluding LCP. The adjusted EBITDA margin for the first quarter is projected to be between 12.25 percent and 12.75 percent.
For the full year FY 2027, sales growth is anticipated to be in the low double-digits to low teens.
John M. Holmes, AAR’s Chairman, President and CEO, stated: “Our momentum continued into the fourth quarter as we delivered another strong set of results. Total adjusted sales were up 26 percent, including 13 percent organically. Growth was driven by each of our key parts, repair, and software platform activities in the quarter, led by our Parts Supply segment which grew 39 percent.”
