Erickson Air-Crane Inc
) posted fourth quarter 2013 adjusted earnings of 10 cents per
share as against a loss of 3 cents per share in the year-ago
quarter. The reported figure beat the Zacks Consensus Estimate of
7 cents per share.
Including acquisition and integration costs as well as a loss on
the sale of the EHI note, the company incurred a loss of 12 cents
per share in the reported quarter compared with a loss of 10
cents per share in the fourth quarter 2012.
In 2013, Erickson reported earnings of $1.52 per share, down 2.6%
from $1.56 per share in 2012.
Erickson Air-Crane registered quarterly pro forma revenues of
$92.9 million, up 9.0% from the year-ago level of $85.2 million.
Revenues in the reported quarter also surpassed the Zacks
Consensus Estimate of $90.0 million by 3.2%.
On a GAAP basis, the company reported quarterly revenues of $92.5
million, up 137.0% from $39.1 million in the fourth quarter 2012.
Strong growth was led by contributions from infrastructure
construction and firefighting as well as synergies from the
Evergreen Helicopters acquisition. The acquisition aided the
company with customer diversification, mission capabilities as
well as geographical expansion.
In 2013, the company reported pro forma revenues of $395.2
million, up 4.2% from $379.2 million in 2012. On the GAAP basis,
the company reported revenues of $318.2 million, up 76% year over
The Government segment comprises defense and security,
firefighting, and transport and other government related
activities. On a GAAP basis, segment sales in the reported
quarter increased 280.0% to $67.2 million from $17.7 million in
the fourth quarter 2012 due to the Evergreen acquisition and
higher demand for firefighting, worth $3.4 million, in Australia
and Turkey. This was partially offset by a decline in crewing
revenues in Italy.
: The Commercial segment includes timber harvesting,
infrastructure construction, including oil and gas and
MRO/Manufacturing. On a GAAP basis, quarterly segment sales
increased 18.0% to $25.3 million from $21.4 million in the fourth
quarter 2012 due to new business in the South American oil and
gas market and U.S. construction, partially offset by a decrease
in MRO activity.
On the cost front, total operating expenses were $14.0 million in
the reported quarter, up a considerable 56.0% year over year.
Cost of revenues also surged 142.7% to $69.3 million from $28.6
million in the fourth quarter of 2012.
Adjusted EBITDA was $19.0 million, up 177.0% from the year-ago
Pro forma operating income in the reported quarter increased
22.7% to $10.8 million from $8.8 million in the prior-year
quarter. Operating income (including $1.6 million of acquisition,
integration and related expenses) in the reported quarter was
Erickson ended 2013 with cash and cash equivalents of
approximately $1.9 million, compared with $1.5 million at the end
Long-term debt (excluding current portion) declined to $16.2
million at the end of 2013 from $26.7 million at 2012 end.
On a reported basis, Erickson expects revenues in the band of
$385.0 million to $405.0 million for 2014. Adjusted EBITDA is
expected between $100.0 million and $110.0 million. Earnings per
share are projected in the range of 95 cents to $1.35 based on
13.8 million of expected shares outstanding.
Update on Acquisitions
In May 2013, Erickson acquired Evergreen Helicopters for $250
million as per the agreement with Evergreen International
The acquisition provided Erickson with an incremental fleet of 64
aircraft comprising both helicopters and fixed-wing airplanes.
This diverse fleet serves a wide range of customers which include
passenger transport and airlift services for the U.S. military.
In 2013, the company also closed the acquisition of Air Amazonia
from HRT Oil & Gas.
With Air Amazonia and Evergreen Helicopters, the combined
business would operate a diverse fleet of 100 aircraft.
ERICKSON AIR-CR (EAC): Free Stock Analysis
HUNTINGTON INGL (HII): Free Stock Analysis
LOCKHEED MARTIN (LMT): Free Stock Analysis
WESCO AIRCRAFT (WAIR): Free Stock Analysis
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These acquisitions would bring in synergies and significant
opportunities for incremental growth in the near as well as long
term. Moreover, the combination of these businesses would
diversify end markets, regions serviced, mission capabilities and
The company presently carries a Zacks Rank #3 (Hold).
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