Astronics (NASDAQ:ATRO)
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Astronics Corporation (NASDAQ: ATRO), a leading manufacturer of
advanced, high-performance lighting, electronics and electrical power
systems for the global aerospace industry, reported net income of $1.9
million for the third quarter of 2006, an increase of $1.1 million over
net income of $0.8 million in the third quarter of 2005. Earnings per
diluted share were $0.23 for the third quarter of 2006 compared with
$0.10 in the same period the prior year. For the nine months ended
September 30, 2006, net income was $5.1 million, or $0.63 per diluted
share, compared with $1.6 million, or $0.20 per diluted share, for the
same period last year.
Sales for the third quarter were $28.5 million, a 40% increase from
$20.4 million in the third quarter of 2005. Over 95% of the increase, or
$7.9 million, can be attributed to higher sales of the Company’s
cabin electronics products, which provide power for in-flight
entertainment and in-seat power systems for the global commercial
airline market. Sales to the business jet market also increased $2.5
million reflecting increased aircraft production rates. Military sales
were down 26% from the third quarter last year. The decrease was
primarily caused by a $2.2 million decrease in deliveries for F-16 night
vision kits for the Republic of Korea Air Force as the Korean program
was concluded in 2005.
Sequentially, sales in the third quarter were down 1.7% from sales in
the second quarter reflecting slower demand and production over the
summer.
Peter J. Gundermann, President and CEO of Astronics Corp., commented, “Our
strategy to be in the three major aircraft markets: military, business
jet and commercial transport, has worked very well in this environment
of strong commercial airlines growth, expansion of the business jet
market and stable sales to the military. Commercial and business jet
aircraft manufacturers are seeing continued expansion of their backlogs.
As a result, we believe that 2007 should be another year of solid growth
for Astronics.”
Gross margin for the quarter was 22.8%, up slightly from 21.9% in the
third quarter of 2005, as a result of leverage provided by higher sales.
Selling, general and administrative (SG&A) expenses were $3.5 million up
from $2.9 million in the same period the prior year. As a percentage of
sales, SG&A was 12% in this year’s third
quarter compared with 14% last year as sales grew at a faster pace than
SG&A spending.
Operating profit almost doubled quarter-over-quarter, from $1.6 million
in the third quarter of 2005 to $3.1 million this year.
Nine-Month Period Review
For the first nine months of 2006, sales were $82.5 million, a 50%
increase from $54.9 million in the same period last year. Sales to the
commercial transport sector doubled over the prior year sales to $45.1
million and currently represent about 55% of total sales. Business jet
sales have improved 40%, when comparing the nine month periods, from
$11.9 million to $16.7 million while military sales have remained
relatively flat at $19.7 million for the first nine months of 2006.
Gross margin for the nine month period improved to 22.6% from 20.5% in
the first nine months of 2005 on higher volume. SG&A increased on an
absolute basis to $9.9 million from $7.7 million during the first nine
months last year, but as a percentage of sales declined to 12% this year
compared with 14% for the 2005 nine-month period.
Liquidity
Cash and cash equivalents at September 30, 2006, was $645 thousand, a
decrease from $4.5 million at December 31, 2005, but an increase from
$425 thousand at July 1, 2006. Increased investment in working capital
components, primarily inventory and receivables associated with
increasing sales growth have used cash reserves.
Capital expenditures for the third quarter of 2006 were $693 thousand up
from $432 thousand in the same period last year. For the nine month
period, capital expenditures increased to $2.3 million from $1.8 million
in the first nine months last year.
Outlook
Bookings for the third quarter of 2006 were $26.0 million, a 29%
increase from bookings of $20.2 million in the third quarter last year.
Backlog at the end of the third quarter was $86.4 million compared with
$77.6 million at the end of the same quarter last year.
Mr. Gundermann added, “As we move through the
fourth quarter, we anticipate that we could be at the high end or
somewhat above our estimated sales range of $105 million to $110 million
for 2006. We are encouraged by the demand for aircraft and the success
our customers are having with orders which should contribute to next year’s
growth and beyond. Across the aerospace industry conditions remain
strong.”
Third Quarter Webcast and Conference
Call
The release of the financial results on November 9, 2006, will be
followed by a company-hosted teleconference at 11:00 a.m. ET. During the
teleconference, Peter J. Gundermann, President and CEO, and David C.
Burney, 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 the following ways:
The live webcast can be found at http://www.astronics.com.
Participants should go to the website 10 - 15 minutes prior to the
scheduled conference in order to register and download any necessary
audio software.
The teleconference can be accessed by dialing (913) 312-1267
approximately 5 - 10 minutes prior to the call.
To listen to the archived call:
The archived webcast will be at http://www.astronics.com.
A transcript will also be posted once available.
A replay can also be heard by calling (719) 457-0820, and entering
passcode 2437531. The telephonic replay will be available through
Thursday, November 16, 2006 at 11:59 p.m. ET.
ABOUT ASTRONICS CORPORATION
Astronics Corporation is a leading manufacturer of advanced,
high-performance lighting and electrical power distribution systems for
the global aerospace industry. Its strategy is to expand the value and
content it provides to various aircraft platforms through product
development and acquisition. Astronics Corporation, and its wholly-owned
subsidiaries Astronics Advanced Electronic Systems Corp. and Luminescent
Systems Inc., have a reputation for high quality designs, exceptional
responsiveness, strong brand recognition and best-in-class manufacturing
practices.
For more information on Astronics and its products, visit its
website at www.Astronics.com.
Safe Harbor Statement
This press 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 expression. Because such statements apply to future
events, they are subject to risks and uncertainties that could cause the
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 industry, the market
acceptance of newly developed products, the ability to cross sell
products and expand markets, 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, such as the Airbus A380; the Eclipse 500; the Air Canada’s
CRJ705, A320, and several configurations of B767; Cessna single engine
aircraft; Cessna Mustang; Hawker Horizon; the V22 Osprey; Lockheed
Martin F-35 JSF; China Eastern Airlines Corp. Limited’s
upgrade of 15 Airbus A330-300’s and five
Airbus A330-200’s; Air China Limited’s
upgrades of 20 Airbus A330-200’s; and F-22
Raptor; 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 press release whether to reflect changed assumptions, the
occurrence of unanticipated events or changes in future operating
results, financial conditions or prospects, or otherwise.
ASTRONICS CORPORATION
CONSOLIDATED INCOME STATEMENT
DATA
(unaudited)
(in thousands except per share data)
Three months ended
Nine months ended
9/30/2006
10/1/2005
9/30/2006
10/1/2005
Sales
$
28,540
$
20,421
$
82,505
$
54,916
Cost of products sold
22,019
15,947
63,891
43,654
Gross margin
22.8%
21.9%
22.6%
20.5%
Selling general and administrative
3,469
2,890
9,931
7,679
Income from operations
3,052
1,584
8,683
3,583
Operating margin
10.7%
7.8%
10.5%
6.5%
Interest expense, net
232
202
650
519
Other (income) expense
(5)
-
(39)
-
Income (loss) before tax
2,825
1,382
8,072
3,064
Income taxes
912
592
2,934
1,468
Net Income
$
1,913
$
790
$
5,138
$
1,596
Basic earnings per share:
$
0.24
$
0.10
$
0.65
$
0.20
Diluted earnings per share:
$
0.23
$
0.10
$
0.63
$
0.20
Weighted average diluted shares outstanding
8,264
8,094
8,210
8,006
Capital Expenditures
$
693
$
432
$
2,300
$
1,765
Depreciation and Amortization
$
701
$
720
$
1,960
$
2,042
ASTRONICS CORPORATION
CONSOLIDATED BALANCE SHEET DATA
(unaudited)
(in thousands)
9/30/2006
12/31/2005
ASSETS:
Cash and cash equivalents
$
645
$
4,473
Accounts receivable
18,065
12,635
Inventories
26,584
19,013
Other current assets
1,966
1,401
Property, plant and equipment, net
21,221
20,461
Other assets
7,691
7,874
Total Assets
$
76,172
$
65,857
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current maturities of long term debt
$
921
$
914
Note payable
7,900
7,000
Accounts payable and accrued expenses
18,843
15,843
Long-term debt
9,837
10,304
Other liabilities
6,179
5,962
Shareholders' equity
32,492
25,834
Total liabilities and shareholders' equity
$
76,172
$
65,857
ASTRONICS CORPORATION
NET SALES BY MARKET
($, in thousands)
Three Months Ended
Nine Months Ended
9/30/2006
10/1/2005
% change
9/30/2006
10/1/2005
% change
2006 YTD %
Military
$
6,136
$
8,330
-26.3%
$
19,724
$
19,500
1.15%
23.9%
Commercial Transport
15,781
7,943
98.7%
45,106
22,534
100.17%
54.7%
Business Jet
6,340
3,812
66.3%
16,668
11,914
39.90%
20.2%
Other
283
336
-15.8%
1,007
968
4.03%
1.2%
Total
$
28,540
$
20,421
39.8%
$
82,505
$
54,916
50.24%
100.0%
ASTRONICS CORPORATION
NET SALES BY PRODUCT
($, in thousands)
Three Months Ended
Nine Months Ended
9/30/2006
10/1/2005
% change
9/30/2006
10/1/2005
% change
2006 YTD %
Cockpit Lighting
$
8,300
$
8,184
1.42%
$
23,582
$
21,597
9.2%
28.6%
Cabin Electronics
12,358
4,472
176.34%
33,316
12,556
165.3%
40.4%
Airframe Power
3,759
3,959
-5.05%
12,320
8,189
50.4%
14.9%
External Lighting
1,872
1,933
-3.16%
5,851
6,632
-11.8%
7.1%
Cabin Lighting
1,968
1,537
28.04%
6,429
4,974
29.3%
7.8%
Other
283
336
-15.77%
1,007
968
4.0%
1.2%
Total
$
28,540
$
20,421
39.76%
$
82,505
$
54,916
50.2%
100.0%
ASTRONICS CORPORATION
ORDER AND BACKLOG TREND
2005
2006
($, in thousands)
Q1 2005
Q2 2005
Q3 2005
Q4 2005
Twelve Months
Q1 2006
Q2 2006
Q3 2006
Nine Months
4/2/05
7/2/05
10/1/05
12/31/05
12/31/05
4/1/06
7/1/06
9/30/06
9/30/06
Bookings
$ 14,868
$ 23,564
$ 20,176
$ 37,946
$ 96,554
$ 23,850
$ 23,929
$ 25,985
$ 73,764
Backlog
$ 72,292
$ 77,856
$ 77,611
$ 95,121
$95,121
$ 94,045
$ 88,935
$ 86,380
$ 86,380
Book:Bill
0.95
1.25
0.99
1.86
1.28
0.96
0.82
0.91
0.89
Astronics Corporation (NASDAQ: ATRO), a leading manufacturer of
advanced, high-performance lighting, electronics and electrical power
systems for the global aerospace industry, reported net income of $1.9
million for the third quarter of 2006, an increase of $1.1 million
over net income of $0.8 million in the third quarter of 2005. Earnings
per diluted share were $0.23 for the third quarter of 2006 compared
with $0.10 in the same period the prior year. For the nine months
ended September 30, 2006, net income was $5.1 million, or $0.63 per
diluted share, compared with $1.6 million, or $0.20 per diluted share,
for the same period last year.
Sales for the third quarter were $28.5 million, a 40% increase
from $20.4 million in the third quarter of 2005. Over 95% of the
increase, or $7.9 million, can be attributed to higher sales of the
Company's cabin electronics products, which provide power for
in-flight entertainment and in-seat power systems for the global
commercial airline market. Sales to the business jet market also
increased $2.5 million reflecting increased aircraft production rates.
Military sales were down 26% from the third quarter last year. The
decrease was primarily caused by a $2.2 million decrease in deliveries
for F-16 night vision kits for the Republic of Korea Air Force as the
Korean program was concluded in 2005.
Sequentially, sales in the third quarter were down 1.7% from sales
in the second quarter reflecting slower demand and production over the
summer.
Peter J. Gundermann, President and CEO of Astronics Corp.,
commented, "Our strategy to be in the three major aircraft markets:
military, business jet and commercial transport, has worked very well
in this environment of strong commercial airlines growth, expansion of
the business jet market and stable sales to the military. Commercial
and business jet aircraft manufacturers are seeing continued expansion
of their backlogs. As a result, we believe that 2007 should be another
year of solid growth for Astronics."
Gross margin for the quarter was 22.8%, up slightly from 21.9% in
the third quarter of 2005, as a result of leverage provided by higher
sales.
Selling, general and administrative (SG&A) expenses were $3.5
million up from $2.9 million in the same period the prior year. As a
percentage of sales, SG&A was 12% in this year's third quarter
compared with 14% last year as sales grew at a faster pace than SG&A
spending.
Operating profit almost doubled quarter-over-quarter, from $1.6
million in the third quarter of 2005 to $3.1 million this year.
Nine-Month Period Review
For the first nine months of 2006, sales were $82.5 million, a 50%
increase from $54.9 million in the same period last year. Sales to the
commercial transport sector doubled over the prior year sales to $45.1
million and currently represent about 55% of total sales. Business jet
sales have improved 40%, when comparing the nine month periods, from
$11.9 million to $16.7 million while military sales have remained
relatively flat at $19.7 million for the first nine months of 2006.
Gross margin for the nine month period improved to 22.6% from
20.5% in the first nine months of 2005 on higher volume. SG&A
increased on an absolute basis to $9.9 million from $7.7 million
during the first nine months last year, but as a percentage of sales
declined to 12% this year compared with 14% for the 2005 nine-month
period.
Liquidity
Cash and cash equivalents at September 30, 2006, was $645
thousand, a decrease from $4.5 million at December 31, 2005, but an
increase from $425 thousand at July 1, 2006. Increased investment in
working capital components, primarily inventory and receivables
associated with increasing sales growth have used cash reserves.
Capital expenditures for the third quarter of 2006 were $693
thousand up from $432 thousand in the same period last year. For the
nine month period, capital expenditures increased to $2.3 million from
$1.8 million in the first nine months last year.
Outlook
Bookings for the third quarter of 2006 were $26.0 million, a 29%
increase from bookings of $20.2 million in the third quarter last
year. Backlog at the end of the third quarter was $86.4 million
compared with $77.6 million at the end of the same quarter last year.
Mr. Gundermann added, "As we move through the fourth quarter, we
anticipate that we could be at the high end or somewhat above our
estimated sales range of $105 million to $110 million for 2006. We are
encouraged by the demand for aircraft and the success our customers
are having with orders which should contribute to next year's growth
and beyond. Across the aerospace industry conditions remain strong."
Third Quarter Webcast and Conference Call
The release of the financial results on November 9, 2006, will be
followed by a company-hosted teleconference at 11:00 a.m. ET. During
the teleconference, Peter J. Gundermann, President and CEO, and David
C. Burney, 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 the following ways:
-- The live webcast can be found at http://www.astronics.com.
Participants should go to the website 10 - 15 minutes prior to
the scheduled conference in order to register and download any
necessary audio software.
-- The teleconference can be accessed by dialing (913) 312-1267
approximately 5 - 10 minutes prior to the call.
To listen to the archived call:
-- The archived webcast will be at http://www.astronics.com. A
transcript will also be posted once available.
-- A replay can also be heard by calling (719) 457-0820, and
entering passcode 2437531. The telephonic replay will be
available through Thursday, November 16, 2006 at 11:59 p.m.
ET.
ABOUT ASTRONICS CORPORATION
Astronics Corporation is a leading manufacturer of advanced,
high-performance lighting and electrical power distribution systems
for the global aerospace industry. Its strategy is to expand the value
and content it provides to various aircraft platforms through product
development and acquisition. Astronics Corporation, and its
wholly-owned subsidiaries Astronics Advanced Electronic Systems Corp.
and Luminescent Systems Inc., have a reputation for high quality
designs, exceptional responsiveness, strong brand recognition and
best-in-class manufacturing practices.
For more information on Astronics and its products, visit its
website at www.Astronics.com.
Safe Harbor Statement
This press 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
expression. Because such statements apply to future events, they are
subject to risks and uncertainties that could cause the 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 industry, the market acceptance of
newly developed products, the ability to cross sell products and
expand markets, 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, such as the Airbus A380; the Eclipse 500; the
Air Canada's CRJ705, A320, and several configurations of B767; Cessna
single engine aircraft; Cessna Mustang; Hawker Horizon; the V22
Osprey; Lockheed Martin F-35 JSF; China Eastern Airlines Corp.
Limited's upgrade of 15 Airbus A330-300's and five Airbus A330-200's;
Air China Limited's upgrades of 20 Airbus A330-200's; and F-22 Raptor;
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
press release whether to reflect changed assumptions, the occurrence
of unanticipated events or changes in future operating results,
financial conditions or prospects, or otherwise.
-0-
*T
ASTRONICS CORPORATION
CONSOLIDATED INCOME STATEMENT DATA
----------------------------------------------------------------------
(unaudited)
(in thousands except per share data)
Three months ended Nine months ended
9/30/2006 10/1/2005 9/30/2006 10/1/2005
------------------------------------------------
Sales $ 28,540 $ 20,421 $ 82,505 $ 54,916
Cost of products sold 22,019 15,947 63,891 43,654
Gross margin 22.8% 21.9% 22.6% 20.5%
Selling general and
administrative 3,469 2,890 9,931 7,679
------------------------------------------------
Income from operations 3,052 1,584 8,683 3,583
Operating margin 10.7% 7.8% 10.5% 6.5%
Interest expense, net 232 202 650 519
Other (income) expense (5) - (39) -
------------------------------------------------
Income (loss) before
tax 2,825 1,382 8,072 3,064
Income taxes 912 592 2,934 1,468
------------------------------------------------
Net Income $ 1,913 $ 790 $ 5,138 $ 1,596
================================================
Basic earnings per
share: $ 0.24 $ 0.10 $ 0.65 $ 0.20
Diluted earnings per
share: $ 0.23 $ 0.10 $ 0.63 $ 0.20
Weighted average
diluted shares
outstanding 8,264 8,094 8,210 8,006
----------------------------------------------------------------------
Capital Expenditures $ 693 $ 432 $ 2,300 $ 1,765
Depreciation and
Amortization $ 701 $ 720 $ 1,960 $ 2,042
----------------------------------------------------------------------
*T
-0-
*T
ASTRONICS CORPORATION
CONSOLIDATED BALANCE SHEET DATA
----------------------------------------------------------------------
(unaudited)
(in thousands)
9/30/2006 12/31/2005
------------------------
ASSETS:
----------------------------------------------
Cash and cash equivalents $ 645 $ 4,473
Accounts receivable 18,065 12,635
Inventories 26,584 19,013
Other current assets 1,966 1,401
Property, plant and equipment, net 21,221 20,461
Other assets 7,691 7,874
------------------------
Total Assets $ 76,172 $ 65,857
========================
LIABILITIES AND SHAREHOLDERS' EQUITY:
----------------------------------------------
Current maturities of long term debt $ 921 $ 914
Note payable 7,900 7,000
Accounts payable and accrued expenses 18,843 15,843
Long-term debt 9,837 10,304
Other liabilities 6,179 5,962
Shareholders' equity 32,492 25,834
------------------------
Total liabilities and shareholders' equity $ 76,172 $ 65,857
========================
*T
-0-
*T
ASTRONICS CORPORATION
NET SALES BY MARKET
($, in thousands)
Three Months Ended
9/30/2006 10/1/2005 % change
------------------------------------
Military $ 6,136 $ 8,330 -26.3%
Commercial Transport 15,781 7,943 98.7%
Business Jet 6,340 3,812 66.3%
Other 283 336 -15.8%
------------------------------------
Total $ 28,540 $ 20,421 39.8%
------------------------------------
Nine Months Ended
2006
9/30/2006 10/1/2005 % change YTD %
--------------------------------- ------
Military $ 19,724 $ 19,500 1.15% 23.9%
Commercial Transport 45,106 22,534 100.17% 54.7%
Business Jet 16,668 11,914 39.90% 20.2%
Other 1,007 968 4.03% 1.2%
--------------------------------- ------
Total $ 82,505 $ 54,916 50.24% 100.0%
--------------------------------- ------
*T
-0-
*T
ASTRONICS CORPORATION
NET SALES BY PRODUCT
($, in thousands)
Three Months Ended
9/30/2006 10/1/2005 % change
------------------------------------
Cockpit Lighting $ 8,300 $ 8,184 1.42%
Cabin Electronics 12,358 4,472 176.34%
Airframe Power 3,759 3,959 -5.05%
External Lighting 1,872 1,933 -3.16%
Cabin Lighting 1,968 1,537 28.04%
Other 283 336 -15.77%
------------------------------------
Total $ 28,540 $ 20,421 39.76%
------------------------------------
Nine Months Ended
2006
9/30/2006 10/1/2005 % change YTD %
--------------------------------- ------
Cockpit Lighting $ 23,582 $ 21,597 9.2% 28.6%
Cabin Electronics 33,316 12,556 165.3% 40.4%
Airframe Power 12,320 8,189 50.4% 14.9%
External Lighting 5,851 6,632 -11.8% 7.1%
Cabin Lighting 6,429 4,974 29.3% 7.8%
Other 1,007 968 4.0% 1.2%
--------------------------------- ------
Total $ 82,505 $ 54,916 50.2% 100.0%
--------------------------------- ------
*T
-0-
*T
ASTRONICS CORPORATION
ORDER AND BACKLOG TREND
2005
($, in thousands)
Q1 2005 Q2 2005 Q3 2005 Q4 2005 Twelve
Months
4/2/05 7/2/05 10/1/05 12/31/05 12/31/05
----------------------------------------------
Bookings $14,868 $23,564 $20,176 $37,946 $96,554
----------------------------------------------------------------------
Backlog $72,292 $77,856 $77,611 $95,121 $95,121
----------------------------------------------------------------------
Book:Bill 0.95 1.25 0.99 1.86 1.28
2006
($, in thousands)
Q1 2006 Q2 2006 Q3 2006 Nine
Months
4/1/06 7/1/06 9/30/06 9/30/06
-------------------------------------
Bookings $23,850 $23,929 $25,985 $73,764
----------------------------------------------------------------------
Backlog $94,045 $88,935 $86,380 $86,380
----------------------------------------------------------------------
Book:Bill 0.96 0.82 0.91 0.89
*T