06:32 AM EDT, 09/24/2024 (MT Newswires) -- AAR (AIR) shares rose early Tuesday as the aviation services provider recorded higher fiscal first-quarter results year over year amid revenue growth across all of its operating segments.

The company posted adjusted earnings of $0.85 per share for the quarter ended August, up from $0.78 a year earlier, it said late Monday. Three analysts polled by Capital IQ expected normalized EPS of $0.82. Sales advanced 20% year over year to $661.7 million, ahead of the $646.6 million consensus based on the same number of analysts. The stock increased 3.6% in premarket activity.

"We drove 26% organic growth in our new parts distribution activities, had strong operational performance in our hangars and saw a return to growth in our government business," Chief Executive John Holmes said in a statement. "The quarter also included meaningful contributions from Trax, and the recent Product Support acquisition continues to exceed our expectations."

Revenue in the parts supply segment climbed to $249.7 million from $236.8 million in the prior-year quarter, with growth "positively impacted by the expansion of both existing product lines and the ramp-up of new business wins, as well as greater purchases by both the US and foreign governments," Chief Financial Officer Sean Gillen said on an earnings call, according to a Capital IQ transcript. Repair and engineering sales jumped 58% to $217.6 million.

In the integrated solutions business, sales inclined to $168.9 million from $156.3 million last year, boosted by growth in commercial power-by-the-hour activities, certain government programs and from Trax, Gillen said on the call. Expeditionary services revenue rose to $25.5 million from $19.1 million last year.

Sales to commercial customers gained 20% amid growth in all three of the company's core segments, according to Gillen. Government sales also moved 20% higher, compared with 15% growth in the prior three-month period, the CFO added.

For the ongoing quarter, AAR expects sales to increase in a range of 18% to 22% and adjusted operating margin to be similar to the prior period's figure of 9.1%, Holmes told analysts on the call. "Demand for our services remains exceptionally strong, and the current dynamics in the aviation supply chain overall are in our favor," according to the CEO.

The midpoint of the revenue guidance implies the company's second-quarter adjusted EPS to be at roughly $0.84, Truist Securities said in a client note. Three analysts surveyed by Capital IQ project $0.88.

Price: 71.60, Change: +2.50, Percent Change: +3.62