Heroux Devtek swings to Q1 loss due to turbulence facing aerospace industry
The company responded to the coronavirus by cutting 10% of its workforce
LONGUEUIL, Que. — Heroux-Devtek Inc. swung to a net loss in its latest quarter as the landing gear manufacturer felt the impact from severe turbulence to the global aerospace industry caused by the COVID-19 pandemic.
The Quebec-based company says it lost $1.3 million or four cents per share in its fiscal first quarter, down from a net profit of $6.4 million or 18 cents per share a year earlier.
Adjusted profits were cut in half, reaching $3.38 million or nine cents per share, compared with $6.96 million or 19 cents per share in the prior year.
Revenues for the three months ended June 30 decreased 10.5% to $128.3 million, from $143.4 million in the first quarter of 2019.
Civil sales decreased 25.9% to $49.9 million from $67.4 million as twin-aisle aircraft deliveries decreased 44% due to the pandemic, while defence sales rose 3.2% to $78.4 million from $76 million last year.
Heroux-Devtek was expected to earn five cents per share in net income and seven cents per share in adjusted profits on $129.8 million of revenues, according to financial markets data firm Refinitiv.
“Our first quarter results were encouraging given this turbulent environment. We remained profitable and generated free cash flow that are helping us maintain a healthy balance sheet. The restructuring measures we announced in May are also proceeding according to plan,” said CEO Martin Brassard.
The company responded to the coronavirus by cutting 225 employees or 10% of its workforce and closing its business unit formerly known as Alta Precision.