AAR Corp (NYSE:AIR) stock fell 8.39% (As on March 22, 11:25:31 AM UTC-4, Source: Google Finance) after the company posted mixed results for the third quarter of FY 24. On March 1, 2024, the company has completed the acquisition of Triumph Group’s Product Support business for $725 million, which was financed using the proceeds from the issuance of $550 million of 6.75% Senior Notes due 2029 and borrowings from the Amended Revolving Credit Facility, which was upsized from $620 million to $825 million. The acquisition of the Product Support business scales the repair capabilities, expands the footprint in the Asia-Pacific region and adds more than 700 talented team members. During the quarter, the company drove 18% sales growth in the commercial business capitalizing on the continued strong demand for both the parts supply activities and MRO services. The company expects commercial demand to remain elevated as the life and high utilization of current generation aircraft continue to extend

AIR in the third quarter of FY 24 has reported the adjusted earnings per share of 85 cents, beating the analysts’ estimates for the adjusted earnings per share of 84 cents, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 9 percent to $567.3 million in the third quarter of FY 24, missing the analysts’ estimates for revenue of $567.6 million. Gross profit margin increased from 18.1% in the prior year quarter to 19.4% in the current quarter, primarily due to the favorable impact of the operating efficiency on increased sales volumes. Selling, general, and administrative expenses were $77.0 million in the current quarter, which included $12.2 million related to acquisition and amortization expenses and $2.0 million related to investigation costs. Operating margins were 5.8% in the current quarter, compared to 6.5% in the prior year quarter. Adjusted operating margin increased from 7.6% in the prior year quarter to 8.3% in the current year quarter, primarily as a result of the growth in commercial sales. Sequentially, the adjusted operating margin increased from 8.1% to 8.3%, driven by improved profitability in the Parts Supply and Repair & Engineering segments. Cash flow provided by operating activities from continuing operations was $20.4 million during the current quarter. As of February 29, 2024, the net debt was $207.8 million and the net leverage was 0.95x.

Additionally, the company repurchased 0.1 million shares for $5.1 million during the current year quarter and have $52.5 million remaining on the $150 million share repurchase program.