AAR Corp. (AIR) has recently been awarded a contract from Military Sealift Command (MSC) to provide airlift support for U.S. Navy ships, beating four other rival bidders for a contract value of approximately $77 million. The contract has a one-year initial base period, three one-year options and an additional 11-month option.
AAR’s Airlift Group provides airlift services in severe environments and performs specialized aircraft modifications, supporting national defense, security and humanitarian relief operations. It uses both fixed-wing aircraft and rotary-wing aircraft to transport people, supplies and mail. The company has been currently providing airlift for the Defense Department in the Western Pacific, Indian Oceans and the Arabian Gulf.
Under the novel vertical replenishment (VERTREP) contract, AIR will be renewing its support services for 4 helicopters, personnel, as well as operational and technical support services in three regions around the world. This award reflects the Military Sealift Commands’ enduring confidence in AAR’s transportation and logistics capabilities over time.
Of late, the company posted favorable first-quarter 2012 financial results with a net income of $16.6 million, an upsurge of approximately 21.8%. Rise in demand from government and defense customers led to a robust sales growth during the quarter. Going forward, the company expects a steady improvement in operating margins.
Based in Wood Dale, Illinois, AAR Corp. provides various products and services to the aviation and defense industries worldwide. The company operates in four segments: Aviation Supply Chain; Maintenance, Repair, and Overhaul; Structures and Systems; and Government & Defense Services. The company competes directly with its peers such as Goodrich Corp (GR), Boeing Co (BA), Lockheed Martin Corporation (LMT).
AAR CORP (AIR): Free Stock Analysis Report
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