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Aerojet Rocketdyne (AJRD) Q2 Earnings Top, Revenues Up Y/Y

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Aerojet Rocketdyne Holdings, Inc. (AJRD - Free Report) reported second-quarter 2018 earnings of 45 cents per share, surpassing the Zacks Consensus Estimate of 26 cents by 73.1%. The reported figure was 40.6% higher than the year-ago quarter’s bottom line of 32 cents.

This year-over-year upside in earnings was driven by an improved operational performance in the reported quarter.

Operational Performance

In the quarter under review, the company’s revenues of $467.2 million witnessed 1.7% year-over-year growth. The reported number also surpassed the Zacks Consensus Estimate of $465 million by 0.5%.

Aerojet Rocketdyne’s total backlog at the end of second-quarter was $3.9 billion, which came in line with the backlog at the end of first quarter. Of this, funded backlog totaled $1.5 billion compared with $1.6 billion at first-quarter end.

Total operating expenses inched up 0.2% to $399.2 million in the second quarter. Operating income of $68 million improved 10.6% from $61.5 million a year ago.

Aerojet Rocketdyne Holdings, Inc. Price, Consensus and EPS Surprise

Segmental Performance

Aerospace & Defense: The segment’s revenues were up 1.7% year over year to $465.6 million, driven by increased deliveries on the back of PAC-3 and Standard Missile programs.

Also, the segment margin expanded 220 basis points (bps) to 14.5%, which was primarily driven by risk retirements derived from RS-25 program coupled with better-than-expected overhead rate performance.

Retail Estate: The segment’s revenues of $1.6 million came in line with the year-ago quarter’s top-line figure.

Financial Update

Aerojet Rocketdyne exited the second quarter with cash and cash equivalents of $514.7 million, down from $535 million as of Dec 31, 2017.

Long-term debt was $581 million, down from $591.4 million as of Dec 31, 2017.

Operating cash inflow from continuing operations was $119.9 million as of Jun 30, 2018 compared with cash inflow of $40.8 million in the year-ago period.

Free cash inflow at the end of the second quarter was $111.8 million compared with the year-ago quarter’s tally of $37.4 million.

Zacks Rank

Aerojet Rocketdyne currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Recent Defense Releases

Boeing (BA - Free Report) reported adjusted earnings of $3.33 per share in second-quarter 2018, beating the Zacks Consensus Estimate of $3.24 by 2.8%.

Lockheed Martin’s (LMT - Free Report) second-quarter 2018 adjusted earnings came in at $4.31 per share, outpacing the Zacks Consensus Estimate of $3.89 by 10.8%.

Textron (TXT - Free Report) reported second-quarter 2018 earnings from continuing operations of 87 cents per share, which surpassed the Zacks Consensus Estimate of 70 cents by 24.3%.

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