Wesco Aircraft Holdings Reports Results for Fiscal Second Quarter 2014

VALENCIA, Calif.—(BUSINESS WIRE)—Wesco Aircraft Holdings, Inc. (“Wesco Aircraft” or the “Company”) (NYSE: WAIR), a leading provider of comprehensive supply chain management services to the global aerospace industry, today announced results for its fiscal second quarter ended March 31, 2014.

Highlights

Revenue for the quarter of $327.4 million, up 45% (approximately 21% organic) compared to the prior year
Net Income of $24.3 million, with Diluted Earnings Per Share (“EPS”) of $0.25
Adjusted Net Income of $32.0 million, up 3% compared to the prior year, with Adjusted Diluted EPS of $0.33
Closed the acquisition of Haas Group Inc. (“Haas”) on February 28, 2014
Full year fiscal 2014 guidance increased for revenue to be in the range of $1.330 billion to $1.380 billion and Adjusted Diluted EPS expected to be in the range of $1.33 to $1.38
Fiscal 2014 Second Quarter Results

Revenue for the second fiscal quarter was $327.4 million, an increase of 45% compared to $225.9 million in the prior year period. The increase in external sales in the North America segment was 27%, which was mainly driven by growth across the Company’s customer base due to continued ramp-up of recently awarded contracts, scope expansion on existing contracts, new contracts and the acquisition of Haas. Wesco Aircraft again demonstrated strong international growth during the quarter with external sales in the Rest of World segment increasing by 112% compared to the prior year period. Overall, Wesco Aircraft organic sales increased approximately 21% compared to the prior year with the remaining approximately 24% contributed from Haas. In the second quarter, Ad Hoc and Contract (which includes Just-In-Time contracts and Long Term Agreements) sales as a percentage of net sales represented 30% and 70%, respectively, compared to 41% and 59%, respectively, for the same period last year. The movement is attributed to Haas having approximately 95% of their revenue under Contract.

Net Income for the second quarter was $24.3 million, resulting in Diluted EPS of $0.25. This compares to Net Income of $29.4 million or $0.31 in Diluted EPS in the prior year period. Adjusted Net Income was $32.0 million and Adjusted Diluted EPS was $0.33 in the second quarter of 2014 as compared to $31.2 million or $0.33 per share in the prior year period. The performance of Diluted EPS and Adjusted Diluted EPS were primarily the result of higher sales and the Haas acquisition, offset by higher selling, general and administrative expenses during the quarter. Adjusted EBITDA for the period was $54.4 million as compared to $51.6 million for the same period in 2013.

Wesco Aircraft’s Chairman, President and Chief Executive Officer, Randy Snyder said, “Our first half results for new contract signings and revenue growth were strong relative to last year and were in line with our expectations. We continue to experience high levels of booking activity, scope additions to our existing contracts and contract signings with new customers. The Haas integration has gotten off to a great start. The active collaboration between the legacy Wesco Aircraft and Haas sales forces is excellent and we anticipate great results from our combined efforts. Our expansion into the MRO market continues to make better then expected progress. We now offer 24/7 global coverage for this growing business. These activities add to our confidence for the rest of the year and fuels our optimism for the future. Wesco Aircraft’s growing global capabilities, dedication to our customers and focused process improvements continue to benefit our industry, our business partners and our shareholders.”

First Six Months of Fiscal 2014

Revenue for the first six months of fiscal 2014 was $552.1 million, an increase of 26% compared to $437.0 million in the prior year period. On a year-to-date basis, Ad Hoc and Contract sales as a percentage of net sales represented 34% and 66%, respectively, compared to 40% and 60%, respectively, for the first six months of fiscal 2013.

Net Income for the period was $48.7 million and Adjusted Net Income was $57.9 million. Net Income resulted in Diluted EPS of $0.50 and Adjusted Net Income resulted in Adjusted Diluted EPS of $0.60. This compared to Net Income of $47.8 million or Diluted EPS of $0.50 and Adjusted Net Income of $55.3 million or Diluted EPS of $0.58 in the prior year period. Adjusted EBITDA on a year-to-date basis was $99.0 million as compared to $95.2 million in 2013.

Financial Outlook

Based on performance for the first half of the fiscal year, the Haas acquisition and continued strong sales and quoting activity, Wesco Aircraft is increasing its guidance for fiscal 2014 and expects full year revenues to be between $1.330 billion and $1.380 billion, representing growth of approximately 48% to 53% over fiscal 2013 results. Adjusted Diluted EPS is now expected in the range of $1.33 to $1.38, an increase of 9% to 13% compared to the prior year.