B/E Aerospace reports third quarter 2014 financial results

Dino D'Amore
By Dino D'Amore October 23, 2014 20:07

B/E Aerospace reports third quarter 2014 financial results

B/E Aerospace has reported a 24% increase in revenue to $1.1bn during the third quarter 2014. Adjusted operating earnings – which exclude charges of approximately $55.3 million in the third quarter – were up by 26% to $203.8 million producing an operating margin of 18.5% up by 30 basis points compared with the prior year period. On a GAAP basis, operating earnings were$148.5 million.

The aircraft interiors company estimates that it will incur, during the second half of 2014, debt redemption costs of approximately $235m, including the write-off of unamortized debt issue costs, approximately $43m in legal, accounting, and advisory costs, and approximately $67m related to international tax initiatives. The firm also expects to incur business repositioning and separation costs of approximately $94m.

Commenting on the recent performance, Amin J. Khoury, Chairman and Chief Executive Officer of B/E Aerospace said: “We reported strong third quarter 2014 operating results, exclusive of the aforementioned charges. In addition, we reported our best ever awards and orders for the nine month year-to-date period for our commercial aircraft and business jet segments. New business awards increased approximately 65% for the nine month period as compared with the prior year period. The vast majority of awards and orders won during the nine month year-to-date period are scheduled for delivery in the 2017/2018 period.”

During the quarter, B/E Aerospace filed a Form 10 Registration Statement with the SEC notifying the regulator of a distribution of the shares of KLX to B/E Aerospace shareholders by the end of 2014.

The Company currently intends to capitalize KLX through the issuance of approximately $1.2 billion of senior unsecured notes, and to use approximately$750 million of the net proceeds to pay a dividend to B/E Aerospace, leaving KLX with an expected approximately $430 million in cash for general corporate purposes, approximately $110 million of which is expected to be used to settle deferred payments associated with 2014 acquisitions. In addition, the company expects KLX will establish a secured revolving credit facility for general corporate purposes.

Dino D'Amore
By Dino D'Amore October 23, 2014 20:07