Hawker Beechcraft Acquisition Company, LLC (HBAC) reported net sales for the three months ended June 27, 2010, of $639.3 million, a decrease of $177.0 million compared to the second quarter of 2009. The decrease was largely attributable to lower aircraft deliveries in the Company’s Business and General Aviation (B&GA) segment as a result of depressed demand across the general aviation market. During the second quarter of 2010, the Company delivered 54 business and general aviation aircraft compared to 78 during the same period in 2009. Included in the second quarter 2009 results was a significant number of King Air aircraft delivered under the U.S. Government’s Project Liberty program. Project Liberty deliveries, which are reported as part of the B&GA segment, concluded in late 2009. Partially offsetting the decline in B&GA segment was continued higher volume in the Trainer Aircraft segment.
During the three months ended June 27, 2010, the Company recorded an operating loss of $20.7 million, compared to an operating income of $39.4 million during the comparable period in 2009. The decrease over the prior year was due to the decreased delivery volume in the B&GA segment offset partially by the increased volume in the Trainer Aircraft segment. Despite the operating loss, the Company’s cash flow generated by operations was $70.8 million during the three months ended June 27, 2010, compared to $29.5 million in the same quarter of 2009. On June 27, 2010, the Company’s cash balance was $307.2 million.
Backlog was $2.4 billion on June 27, 2010, compared to $3.1 billion on March 28, 2010. Backlog at June 27, 2010, reflects the impact of a cancellation notice from NetJets which reduced backlog by approximately $400 million. As a result of this cancellation, the Company no longer has any backlog with NetJets. None of the cancelled orders were scheduled for delivery in 2010 and only one was scheduled to deliver in 2011.
Form 10-Q and Earnings Conference Call:Additional financial information is included in the Company’s second quarter 2010 Form 10-Q filed with the Securities and Exchange Commission earlier today and in the attached tables. HBAC’s earnings results conference call for the three months ended June 27, 2010, will be held Wednesday, Aug. 4, 2010, at 10 a.m. CDT. To attend, register at https://cossprereg.btci.com/prereg/key.process?key=PYCLJT99X.
Once you register, you will be provided with dial-in numbers and pass codes needed to join the conference call. A recording of the earnings call will be posted to the Company’s Web site after the call and will be available for 45 days.
Hawker Beechcraft Corporation is a world-leading manufacturer of business, special-mission and trainer aircraft – designing, marketing and supporting aviation products and services for businesses, governments and individuals worldwide. The company’s headquarters and major facilities are located in Wichita, Kan., with operations in Salina, Kan.; Little Rock, Ark.; Chester, England, U.K.; and Chihuahua, Mexico. The company leads the industry with the largest number of factory-owned service centers and a global network of more than 100 factory-owned and authorized service centers. For more information, visit www.hawkerbeechcraft.com.