BE Aerospace Inc. (BEAV) filed Quarterly Report for the period ended 2009-09-30.
B/E Aerospace Inc. is the world's leading manufacturer of aircraft cabin interior products serving virtually all the world's airlines and aircraft manufacturers. B/E designs develops manufactures sells and services a broad line of passenger cabin interior products for both commercial and business/VIP aircraft and provides interior design reconfiguration and conversion services to its customers throughout the world. Be Aerospace Inc. has a market cap of $1.88 billion; its shares were traded at around $18.58 with a P/E ratio of 10.8 and P/S ratio of 0.9. Be Aerospace Inc. had an annual average earning growth of 38.4% over the past 5 years.
Highlight of Business Operations:
Net sales in the third quarter of 2009 of $459.8 decreased by $128.0, or 21.8%, as compared with the third quarter of the prior year. The decrease in net sales was the result of the $38.2, or 17.4%, decrease in net sales at the consumables management segment, a $78.3, or 26.0% decrease in net sales at the commercial aircraft segment and a $11.5, or 17.0%, decrease in net sales at the business jet segment. On a proforma basis, to include HCS (which was acquired on July 28, 2008), in both periods, net sales declined $168.9, or 26.9%, as compared with the third quarter of 2008.
Operating earnings for the third quarter of 2009 of $69.6 decreased $31.7, or 31.3%, as compared to the same period in 2008, reflecting the $128.0 decrease in net sales, the timing of the HCS acquisition and a $9.0 net negative foreign exchange impact, offset by a 240 basis point reduction in cost of sales as a percentage of net sales and our cost reduction initiatives. On a proforma basis to include HCS in both periods, third quarter 2009 operating earnings decreased $33.5, or 32.5% on the 26.9% decrease in revenues as compared to the same period in 2008.
Earnings before income taxes for the three months ended September 30, 2009 of $46.9 decreased by $31.0, or 39.8%, as compared to earnings before income taxes of $77.9 in the same period in the prior year due to the $128.0 decrease in net sales, a $31.7 decrease in operating earnings and a $2.9 increase in interest expense. On a proforma basis to include HCS in both periods, earnings before income taxes for the three months ended September 30, 2009 decreased by $34.5, or 42.4%, as compared to proforma earnings before income taxes in the prior year of $81.4. This decrease was primarily due to the 26.9% decrease in net sales in the three months ended September 30, 2009 and other factors described above.
Net earnings for the third quarter of 2009 were $36.1, or $0.36 per diluted share, as compared with net earnings of $51.8, or $0.54 per diluted share, in the second quarter of 2008. Net earnings decreased by $15.7, or 30.3%, as compared with the third quarter of the prior year as a result of the decrease in net sales and other factors described above.
Consumables management segment net sales during the third quarter of 2009 were $181.0, which represented a $38.2, or 17.4%, decrease over the same quarter in the prior year. On a proforma basis, consumables management segment net sales in the third quarter of 2009 were lower by $79.1, or 30.4% than in third quarter of 2008. The decline in net sales in the current quarter as compared to the same period in the prior year was due to reduced activity at airline and maintenance, repair and overhaul (MRO) facilities, reduced aircraft capacity, a decrease in revenue passenger miles flown, and substantially reduced activity at business jet manufacturers, all as compared to the same period in the prior year. Consumables management segment operating earnings were $33.5, or 18.5% of sales as compared with $42.1, or 19.2% of sales in the third quarter of 2008. On a proforma basis, third quarter 2009 operating margin expanded 160 basis points as compared 2008 operating earnings of $43.9, or 16.9% of sales reflecting more efficient purchasing in the current period and initial synergies arising from the HCS acquisition.
Commercial aircraft segment net sales during the third quarter of 2009 of $222.5 decreased $78.3, or 26.0%, reflecting retrofit program push outs, reduced activity at airline and MRO maintenance facilities, reduced aircraft capacity and a decrease in revenue passenger miles flown, all as compared to the same period in the prior year. Third quarter 2009 operating earnings were $29.8, or 13.4% of net sales as compared with the third quarter 2008 operating earnings of $49.4, or 16.4% of sales. The 300 basis point decrease in operating margin was primarily due to a $78.3, or 26.0% lower level of sales and approximately $9.0
BEAV is in the portfolios of Arnold Schneider of Schneider Capital Management.
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