Canadian aviation-training and simulation products provider CAE, Inc. (CAE,CAE.TO) on Thursday reported an 18 percent decline in profit for the fourth quarter from last year as restructuring, integration and acquisition costs more than offset strong revenue growth. However, both revenue and adjusted earnings per share beat analysts' expectations.
Marc Parent, president and chief executive officer said, "Our results for the quarter and the year reflected our integration of new businesses and restructuring of Civil and Military operations. Backlog exceeded $4 billion for the first time in CAE's history, with a high proportion involving recurring services. In Civil Products, we had a strong finish to the year, meeting our mid-30s full-flight simulator order outlook."
The Montreal, Canada-based company's net earnings for the fourth quarter were C$43.8 million or C$0.17 per share, down from C$53.2 million or C$0.21 per share in the prior-year quarter.
Excluding C$10.1 million of restructuring, integration and acquisition costs, adjusted net earnings for the latest quarter was C$53.9 million or C$0.21 per share. On average, fifteen analysts polled by Thomson Reuters expected the company to report earnings of C$0.18 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the quarter grew 16 percent to C$587.9 million from C$506.7 million in the same quarter last year. Analysts had a consensus revenue estimate of C$586.08 million.
Revenue at the company's combined civil segments posted 54 percent growth in revenue from the year-ago period to C$331.6 million, while combined military segments decreased 15 percent to C$227.3 million. Revenue from new core markets of mining and healthcare rose 20 percent to C$29 million.
Total operating profit for the quarter decreased to C$71.6 million from C$88.7 million in the prior-year quarter and operating margin contracted 530 basis points to 12.2 percent.
CAE's backlog at the end of the fourth quarter was C$4.09 billion, up 10 percent from C$3.72 billion a year ago.
For fiscal 2013, CAE's net income declined to C$139.4 million or C$0.54 per share from C$180.3 million or C$0.70 per share in the previous year. Adjusted net income for the year was C$190.7 million or C$0.74 per share.
Revenue for the year increased 16 percent to C$2.10 billion from C$1.82 billion last year.
Analysts expected the company to earn C$0.70 per share for the year on revenues of C$2.10 billion.
CAE said it will pay a quarterly dividend of C$0.05 per share, effective June 28 to shareholders of record at the close of business on June 14.
Looking ahead, CEO Parent said, "With continued high levels of aircraft deliveries, we expect strong demand for civil full-flight simulators again in fiscal 2014."
In Thursday's regular session, CAE is trading at $10.68, up $0.25 or 2.40 percent on a volume of 1,792 shares. On the Toronto stock exchange, CAE.TO is currently trading at C$10.72, up C$0.12 or 1.13 percent on a volume of 55,675 shares.
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