CAE Q4 Profit Rises On Higher Revenue, Margins

(RTTNews) - Canadian aviation-training and simulation products provider CAE, Inc. (CAE, CAE.TO) on Thursday reported a 39 percent increase in profit for the fourth quarter from last year, reflecting higher revenue and improved margins.

Marc Parent, CAE's President and Chief Executive Officer said, "Our operational discipline and customer focus continued to drive positive results. Civil is back on track with operating margins in the high teens and Military is proving resilient with continued growth."

The Montreal, Canada-based company's net earnings for the fourth quarter were C$60 million or C$0.23 per share, up from C$43.1 million or C$0.17 per share in the prior-year quarter.

On average, eleven analysts polled by Thomson Reuters expected the company to report earnings of C$0.20 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew 3 percent to C$583.4 million from C$565.6 million in the same quarter last year. Analysts' had a consensus revenue estimate for the quarter of C$576.33 million.

Revenue at the company's combined military segments grew 6 percent from the year-ago period to C$230.3 million, while revenues at the combined civil segments edged up 1 percent to C$323.5 million. Revenues from new core markets of mining and healthcare rose 2 percent to C$29.6 million.

CAE's total operating profit for the quarter increased to C$86.2 million from C$66.9 million in the prior-year quarter, and operating margin improved 300 basis points to 14.8 percent.

Combined civil segment operating margin expanded 200 basis points to 17.9 percent, while combined military segment operating margin declined 80 basis points to 12.2 percent.

During the quarter, CAE received 8 full-flight simulator or FFS orders from customers, including Southwest Airlines and Lufthansa Flight Training.

The company also booked simulator and training system contracts in the quarter involving the T-6C aircraft for the Royal New Zealand Air Force and Mexican Air Force, the SW-4 helicopter for the Polish Air Force; and the P-8A Poseidon aircraft for the US Navy.

In addition, CAE booked upgrade contracts for C130 Hercules customers worldwide and support services contracts in Europe and Southeast Asia. In total, the company received C$189 million in combined military segment orders in the latest quarter.

CAE's backlog at the end of the fourth quarter was C$4.21 billion, up 13 percent from C$3.72 billion in the same period last year. The backlog includes a record 48 civil FFS sales and long-term military contracts on new platforms for CAE. Since the start of the new fiscal year, CAE has announced another 4 FFS orders.

CAE said it will pay a quarterly dividend of C$0.06 per share, effective June 30, to shareholders of record at the close of business on June 13, 2014.

For fiscal 2014, CAE's net income attributable to equity holders increased to C$190 million or C$0.73 per share from C$137.7 million or C$0.53 per share last year. Revenue for the year rose 3 percent to C$2.11 billion from C$2.04 billion in the prior year.

Street expected the company to report earnings of C$0.67 per share for the year on revenues of C$2.11 billion.

CAE is currently trading at $13.41, up $0.31 or 2.37 percent on a volume of 5,545 shares. On the Toronto stock exchange, CAE.TO is trading at C$14.55, up C$0.04 or 0.28 percent on a volume of 77,714 shares.