Delivered 72 Aircraft; Lost $1.5 Million On Hawker 4000, Other
Charges
The numbers weren't as good as they'd hoped... but by all
indications, the situation should improve soon. That's the message
from Hawker Beechcraft Acquisition Company, LLC (HBAC) which on
Wednesday reported continued strong market acceptance and demand
for its products, resulting in net bookings of $1.1 billion during
the three months ending March 30, 2008. Continued strong order
activity resulted in a record backlog of $6.8 billion.
That's the good news. Less encouraging was the news HBAC
recorded an operating loss of $1.5 million for the quarter, in part
due to an $18.4 million charge related to early production Hawker
4000 aircraft. This resulted from an increase in the cost to
conform the early aircraft to the final type design, according to
the company.
Also included in the operating results were non-cash charges of
$22.1 million resulting from increased depreciation and
amortization expense due to step-up in the cost basis of long-term
assets and from foreign currency derivative contracts, all incurred
as a result of purchase accounting related to the acquisition of
HBAC.
Net sales for the quarter were
$576.5 million. The company delivered 72 business and general
aviation aircraft consisting of 20 jet, 29 turbo-prop and 23 piston
aircraft. During the quarter, the company also launched a
reorganization of its Little Rock Hawker completions operations, to
support the increased aircraft completion volumes that are
associated with deliveries of the Hawker 750, and the expected
introduction of the oft-delayed Hawker 4000, this year.
These reorganization activities impacted the normal completion
cycle for aircraft during the quarter, resulting in the delivery of
five Hawker 900XP and one Hawker 850XP being shifted to the second
quarter. HBAC’s trainer segment also delivered 17 T-6A Texan
II aircraft to the US Government during the first quarter.
Operating cash consumed during the three months ending March 30,
2008 totaled $181.9 million. This resulted from a growth in
inventory in connection with increased build rates and the delay in
aircraft deliveries noted previously.
"While disappointed by this quarter’s operating results,
we are still extremely excited about our record billings,
increasing backlog and our position in the market," said Jim
Schuster, chairman and CEO of Hawker Beechcraft Corporation. "The
end of the first quarter marks a tremendous first full year as
Hawker Beechcraft, having solidified our future as the largest
privately-held aircraft manufacturer in the world. We invested in
new products, expanded infrastructure and added talented people
– strategically positioning our brands for continued growth
worldwide."