AAR Corp.’s (AIR) Airlift division has won a 10-year search & rescue contract from the United Kingdom Ministry of Defence in the Falkland Islands. The contract, worth $275 million (approximately £180 million), will help the company to leverage its defense know-how and diversify its Airlift business.
The contract calls for the AAR Airlift division to provide Search & Rescue (“SAR”) and Support Helicopter services in the Falkland Islands, with support from British International Helicopters and Air Rescue Systems.
AAR Airlift will use an unspecified number of AgustaWestland AW-189 SAR and Sikorsky S-61 support helicopters for conducting flight operations, maintenance, logistics and facilities support from the Mount Pleasant Complex in the Falkland Islands.
Wood Dale, IL based AAR provides various products and services to the aviation and defense industries worldwide. Its Airlift Group business unit serves both commercial and government clients. AAR Airlift provides fixed and rotary-wing flight support, training, aviation maintenance, and aviation refurbishment services.
AAR has maintained a satisfactory competitive position through its market expertise as well as technical and financial capabilities. The company expects its inherently strong supply chain and MRO businesses to grow in the thriving global aviation services market. For the second half of fiscal 2015, the company expects continued double-digit growth, as high as 20% year over year, from its Aviation Services supply chain business.
That said, its Aviation Services revenues, comprising 77% of fiscal second quarter 2015 (ending Nov 30, 2014) total revenues, declined 11.1% from the year-ago quarter. The downtrend was due to lower contributions from its airlift and MRO services, although MRO facility utilization gained during the quarter. The latest contract will likely give a boost to the Airlift business and contribute to the company’s revenues going forward.
AAR Corp. holds a Zacks Rank #3 (Buy). Better-ranked stocks in the same sector include Spirit AeroSystems Holdings, Inc. (SPR), Astronics Corporation (ATRO) and Curtiss-Wright Corporation (CW). While Spirit AeroSystems holds a Zacks Rank #1 (Strong Buy), Astronics and Curtiss-Wright carry a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment