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AAR Provides Update on Strategic Positioning and
Reports Fourth Quarter and Fiscal Year 2015 Results
Update on Strategic Positioning
Upon completing the Companys annual strategic review process and assessing its markets, AAR entered fiscal 2015 with a mission to narrow its focus and excel as an independent services provider to the global commercial aviation, government and defense markets. AAR is executing this strategy by selling manufacturing businesses and taking actions to strengthen the long-term growth potential of its industry-leading services businesses. When complete, this transformation will simplify the Companys operations, significantly strengthen its balance sheet, and improve its return to shareholders.
The financial highlights associated with the strategic positioning to date are as follows:
· Received gross proceeds of $710.9 million and recorded a pre-tax gain of $198.6 million related to the sale of the Telair Cargo Group, with potential for $35.0 million of additional proceeds by December 31, 2015 subject to certain conditions.
· Reclassified our Precision Systems Manufacturing operations as discontinued operations and recorded pre-tax goodwill and other impairment charges of $57.5 million.
· Recorded approximately $74.5 million of pre-tax charges including costs associated with streamlining our operations and converting underperforming or excess assets to cash. Approximately $62.0 million are attributable to the Aviation Services segment, $8.0 million to Expeditionary services and $4.5 million to corporate restructuring.
· Repurchased 4.7 million shares returning approximately $150.0 million of value to AAR shareholders.
· Redeemed $325.0 million of 7.25% notes reducing annual interest expense by $24.0 million and incurred a pre-tax make whole premium of $45.6 million. Additionally, terminated early a swap and cap arrangement and recorded a $2.0 million charge, saving approximately $1.1 million in interest per year.
It was a very pivotal year for AAR, said David P. Storch, Chairman and Chief Executive Officer of AAR CORP. In the first phase of our transformation, we sold the Telair Cargo Group and placed our Precision Systems Manufacturing up for sale. In phase two, we used a portion of the proceeds from the sale to redeem our High-Yield notes and return capital to shareholders
The following information was filed by Aar Corp (AIR) on Tuesday, July 14, 2015 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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