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MONROVIA, Calif., September 5, 2018 — AeroVironment, Inc. (NASDAQ: AVAV) today reported financial results for its first quarter ended July 28, 2018.
“Our strong funded backlog at the end of fiscal 2018 and continued execution of our strategy enabled us to deliver $78 million in revenue from continuing operations, a 127 percent increase year-over-year, and $0.85 earnings per diluted share from continuing operations, which included $0.26 from a one-time litigation settlement,” said Wahid Nawabi, AeroVironment president and chief executive officer. “With the divestiture of our Efficient Energy Systems business, we have transformed AeroVironment into a future-defining technologies solution provider serving large and growing global defense, telecommunications and commercial markets. Strength in the end markets for our small UAS and Tactical Missile Systems, combined with continued progress in our HAPSMobile, Inc. joint venture, position us well to achieve our fiscal year 2019 objectives and our long-term value creation goals.”
During the first quarter of fiscal 2019, the Company adopted the new revenue accounting standard, ASC 606, using the full retrospective method. All periods presented have been revised to reflect the adoption of the standard.
FISCAL 2019 FIRST QUARTER RESULTS
Revenue for the first quarter of fiscal 2019 was $78.0 million, an increase of 127% from first quarter fiscal 2018 revenue of $34.4 million. The increase in revenue was due to an increase in product sales of $36.5 million and an increase in service revenue of $7.1 million.
Gross margin for the first quarter of fiscal 2019 was $32.6 million, an increase of 275% from first quarter fiscal 2018 gross margin of $8.7 million. The increase in gross margin was primarily due to an increase in product margin of $22.7 million and an increase in service margin of $1.2 million. As a percentage of revenue, gross margin increased to 42% from 25%. The increase in gross margin percentage was primarily due to an increase in sales volume and an increase in the proportion of product sales to total revenue.
Income from continuing operations for the first quarter of fiscal 2019 was $14.2 million, an increase from first quarter fiscal 2018 loss from continuing operations of $8.1 million. The increase in income from continuing operations was primarily a result of an increase in gross margin of $23.9 million, partially offset by an increase in research and development (“R&D”) expense of $0.9 million and an increase in selling, general and administrative (“SG&A”) expense of $0.7 million.
Other income, net, for the first quarter of fiscal 2019 was $9.3 million compared to other income, net of $0.5 million for the first quarter of fiscal 2018. The increase in other income, net was primarily due to a one-time gain from a litigation settlement.
Provision for income taxes for the first quarter of fiscal 2019 was $2.6 million compared to a benefit for income taxes of $3.2 million for the first quarter of fiscal 2018. The increase in provision for income taxes was primarily due to the increase in income before income taxes. The provision for income taxes was also impacted by a reduction of the federal statutory tax rate from 35% to 21% as a result of the Tax Cut and Jobs Act of 2017.
The following information was filed by Aerovironment Inc (AVAV) on Wednesday, September 5, 2018 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-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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