TransDigm Group Inc (NYSE:TDG), a leading global designer, producer and supplier of highly engineered aircraft components, stock rose 1.70% (As on August 8, 11:35:05 AM UTC-4, Source: Google Finance) after the company reported higher than expected results for the third quarter of FY 23. Organic sales growth as a percentage of net sales was 20.7%. Income from continuing operations for the quarter increased $113 million, or 47.3%, to $352 million from $239 million in the comparable quarter a year ago. The increase in income from continuing operations primarily reflects the increase in net sales described above and favorable sales mix. The comparable quarter a year ago also included the adverse impact of a pension settlement charge for the Esterline Retirement Plan. EBITDA for the quarter increased 29.1% to $830 million from $643 million for the comparable quarter a year ago.
Meanwhile, the company has completed the acquisition of Calspan Corporation for approximately $725 million in cash, including certain tax benefits. Calspan is a leading independent provider of highly engineered testing and technology development services and systems primarily for the aerospace & defense industry. Calspan’s state of the art transonic wind tunnel in Buffalo, New York is used across a range of important aftermarket-focused development activities for both the commercial and defense aerospace end markets.
TDG in the third quarter of FY 23 has reported the adjusted earnings per share of $7.25, beating the analysts’ estimates for the adjusted earnings per share of $6.33, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 25 percent to $1.74 billion in the third quarter of FY 23, beating the analysts’ estimates for revenue of $1.68 billion.
TransDigm expects full-year earnings in the range of $24.94 to $25.36 per share, with revenue in the range of $6.53 billion to $6.59 billion. Net sales are anticipated to be in the range of $6,525 million to $6,585 million compared with $5,429 million in fiscal 2022 (an increase of $100 million at the mid-point). Net income from continuing operations is anticipated to be in the range of $1,227 million to $1,251 million compared with $866 million in fiscal 2022 (an increase of $73 million at the mid-point).
In addition, for fiscal 2023, Commercial aftermarket revenue growth is anticipated in the low 30% range, Commercial OEM revenue growth is anticipated in the 20% to 25% range; and Defense revenue growth is anticipated in the mid to high-single-digit percentage range.