KLX Inc. (NASDA: KLXI) reported a decline in 1Q16 earnings due to a drop in revenues from military and business jet customers. Net income fell to $6.2MM or $0.12 per share from $17.9MM or $0.34 per share last year. Revenues dropped to $368.2MM from $431.5MM. Excluding items, the company earned $0.42. $KLXI's revenue from Aerospace Solutions Group for 1Q16 declined 4.9%. Revenue from Energy Services Group dropped 55.6%
The company expects the Herndon acquisition to add to EBITDA and EPS in current fiscal year, Also in longer term, $KLXI believes Herndon will contribute meaningfully to its growth.
During the call, Gautam Khanna of Cowen & Co. probes on the pricing side of the ASG business. To this $KLXI said that pricing has held firm and had no deflation in pricing in 1Q16 and last year in 2015.
When Myles Walton from Deutsche Bank questioned on the troughing of the financial performance within ESG. $KLXI said the volumes have not yet stabilized, but reducing headcount by 800 people and closing 11 satellite facilities is expected to substantially benefit the company's cost structure. This is expected to be completed by 2Q16.
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Submitted May 23, 2016 at 01:37PM by Robert-Phillips http://ift.tt/1TGAwoa
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