DENVER, NC / ACCESSWIRE / June 28, 2022 / Air T, Inc. (NASDAQ:AIRT) is an industrious American company with a portfolio of businesses, each of which is independent yet interrelated. We seek dynamic individuals and teams to operate companies using processes that increase value over time. We believe we can apply corporate resources to help activate growth and overcome challenges.
Our core segments are overnight air cargo; aviation ground equipment manufacturing and sales; commercial jet engines and parts; and corporate and other.
Today the Company is announcing results for the Fiscal year ended March 31, 2022:
- Revenues totaled $177.1 million for the fiscal year ended March 31, 2022, an increase of $2.0 million, or 1.1% from the prior year.
- Operating income was $8.8 million for the fiscal year ended March 31, 2022, an increase of $18.0 million from the prior year's operating loss of $9.2 million.
- Adjusted EBITDA* profit of $11.4 million for the year ended March 31, 2022, compared to an Adjusted EBITDA* loss of $1.3 million in the prior year.
- Income per share of $3.79 for the year ended March 31, 2022, compared to loss per share of $2.53 for the prior year.
- Total Equity increased from $14.7 million as of March 31, 2021, to $24.7 million as of March 31, 2022, an increase of $10.0 million, or 68%.
*Adjusted EBITDA is a non-GAAP financial measure; see below for further explanation and reconciliation to GAAP measure.
Company Chairman and CEO Nick Swenson commented:
"We are working to build AIRT's businesses day by day. This is a process and journey, not a destination. We were hard hit by Covid. And the covid recovery started later in aviation than in other industries-yet the recovery is gathering apace now. AIRT businesses reflect this dynamic and you will notice that the company exited Fiscal 2022 at a much improved level as compared to Fiscal Years 2020 and 2021. Despite many economic storm clouds gathering here and now in June of 2022, we are not experiencing any headwinds at the present time. If and when the inevitable slow-down occurs, then we will have the opportunity to make an intelligent, long-term strategic investment."
Business Segment Results
Overnight Air Cargo
- This segment provides air express delivery services, substantially all for FedEx.
- Revenues for this segment increased 12.2% to $74.4 million in Fiscal 2022 compared to $66.3 million in the prior fiscal year, principally attributable to higher FedEx's pass-through revenues, higher admin fee as a result of increased contract rates starting in June 2021 and higher maintenance labor revenue. In addition, maintenance revenue with customers outside of FedEx increased compared to the prior year.
- Adjusted EBITDA* for this segment was $2.9 million for the year ended March 31, 2022, an increase of $0.6 million when compared to the prior fiscal year, primarily due to the revenue increase noted above.
Aviation ground equipment manufacturing and sales ("GGS")
- This segment, which includes the world's largest manufacturer of aircraft de-icing equipment, manufactures and provides mobile deicers and other specialized equipment products to passenger and cargo airlines, airports, and military and industrial customers.
- Revenues for this segment totaled $42.2 million for Fiscal 2022, down 30.5% versus $60.7 million in the prior fiscal year. The decrease was primarily driven by a lower volume of truck sales to the U.S. Air Force in fiscal year 2022.
- Adjusted EBITDA* for this segment was $3.5 million in the fiscal year ended March 31, 2022, a decrease of $5.6 million compared to the prior fiscal year, due primarily to the revenue decrease noted above.
- As of March 31, 2022, this segment's order backlog was $14.0 million versus $10.3 million on March 31, 2021.
Commercial Jet Engines and Parts
- This segment leases commercial jet engines and aircraft; buys, sells and trades in surplus and aftermarket commercial jet engines, engine parts, airframes, and airframe parts, avionics, and other; then delivers the related documents and logistics.
- Revenues for this segment totaled $57.7 million in Fiscal 2022, an increase of $10.9 million from Fiscal 2021. The increase was primarily attributable to the fact that all the companies within this segment had higher component sales as the aviation industry started to see more activity in the current year as COVID-19 related restrictions continued to loosen.
- Adjusted EBITDA* for this segment was $5.2 million for the year ended March 31, 2022, compared to an Adjusted EBITDA* loss of $3.9 million in the prior year.
Corporate and Other
- This segment includes expenses attributable to core Corporate functions, investment research, and specialized resources that are available to business units.
- The corporate and other segment Adjusted EBITDA increased by $8.7 million from Fiscal 2021 to Fiscal 2022. The increase was driven by an offset to general and administrative expenses in the current fiscal year as a result of the $9.1 million Employee Retention Credit receivable expected to be received by the Company in Fiscal 2023.
*Adjusted EBITDA is a non-GAAP financial measure; see below for further explanation and reconciliation to GAAP measures.
Non-GAAP Financial Measures
The Company uses adjusted earnings before taxes, interest, and depreciation and amortization ("Adjusted EBITDA"), a non-GAAP financial measure as defined by the SEC, to evaluate the Company's financial performance. This performance measure is not defined by accounting principles generally accepted in the United States and should be considered in addition to, and not in lieu of, GAAP financial measures.
Adjusted EBITDA is defined as earnings before taxes, interest, and depreciation and amortization, adjusted for specified items. The Company calculates Adjusted EBITDA by removing the impact of specific items and adding back the amounts of interest expense and depreciation and amortization to earnings before income taxes. When calculating Adjusted EBITDA, the Company does not add back depreciation expense for aircraft engines that are on lease, as the Company believes this expense matches with the corresponding revenue earned on engine leases. Depreciation expense for leased engines totaled $0.3 million and $1.9 million for the fiscal year ended March 31, 2022, and 2021, respectively.
Management believes that Adjusted EBITDA is a useful measure of the Company's performance because it provides investors additional information about the Company's operations allowing better evaluation of underlying business performance and better period-to-period comparability. Adjusted EBITDA is not intended to replace or be an alternative to operating income, the most directly comparable amounts reported under GAAP.
The table below provides a reconciliation of operating income to Adjusted EBITDA for the periods ended March 31, 2022, and 2021 (in thousands):
|Twelve Months Ended|
Depreciation and amortization (excluding leased engines depreciation)
Asset impairment, restructuring or impairment charges
Loss on disposition of assets
Security issuance expenses
The following table shows the Company's Adjusted EBITDA by segment for the periods ended March 31, 2022, and 2021 (in thousands):
|Twelve Months Ended|
Overnight Air Cargo
Ground Equipment Sales
Commercial Jet Engines and Parts
Corporate and Other
ABOUT AIR T, INC.
Established in 1980, Air T Inc. is a portfolio of powerful businesses and financial assets, each of which is independent yet interrelated. Its core segments are overnight air cargo, aviation ground support equipment manufacturing, and commercial aircraft asset management and logistics. We seek to expand, strengthen and diversify Air T's after-tax cash flow per share. Our goal is to build Air T's core businesses, and when appropriate, to expand into adjacent and other industries. We seek to activate growth and overcome challenges while delivering meaningful value for all stakeholders. For more information, visit www.airt.net.
Certain statements in this press release, including those contained in "Overview," are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the Company's financial condition, results of operations, plans, objectives, future performance and business. Forward-looking statements include those preceded by, followed by or that include the words "believes", "pending", "future", "expects," "anticipates," "estimates," "depends" or similar expressions. These forward-looking statements involve risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements, because of, among other things, potential risks and uncertainties, such as:
- Economic and industry conditions in the Company's markets;
- The risk that contracts with FedEx could be terminated or adversely modified;
- The risk that the number of aircraft operated for FedEx will be reduced;
- The risk that GGS customers will defer or reduce significant orders for deicing equipment;
- The impact of any terrorist activities on United States soil or abroad;
- The Company's ability to manage its cost structure for operating expenses, or unanticipated capital requirements, and match them to shifting customer service requirements and production volume levels;
- The Company's ability to meet debt service covenants and to refinance existing debt obligations;
- The risk of injury or other damage arising from accidents involving the Company's overnight air cargo operations, equipment or parts sold and/or services provided;
- Market acceptance of the Company's commercial and military equipment and services;
- Competition from other providers of similar equipment and services;
- Changes in government regulation and technology;
- Changes in the value of marketable securities held as investments;
- Mild winter weather conditions reducing the demand for deicing equipment;
- Market acceptance and operational success of the Company's relatively new aircraft asset management business and related aircraft capital joint venture; and
- The length and severity of the COVID-19 pandemic.
A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. We are under no obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.
Air T, Inc.
Brian Ochocki, CFO
SOURCE: Air T, Inc.
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