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AeroVironment shares drop after earnings report

By   /   Wednesday, June 30th, 2021  /   Comments Off on AeroVironment shares drop after earnings report

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AeroVironment, a drone and robotics company with its chief operations in Simi Valley, delivered record revenue in the fourth quarter and full year of 2021, according to earnings released June 29, but a couple of key losses led to a year-to-year earnings drop.

In the fourth quarter of its 2021 fiscal year, AeroVironment posted a net income of $10.9 million, or 44 cents per diluted share, a dropoff of 37% from the same quarter in 2020, due to a $9.3 million legal accrual related to the company’s former EES business, the company said in its Jun 29 news release.

For the year, AeroVironment had net income of $23.3 million, or 96 cents per diluted share, compared to fiscal year 2020, when the company had net income of $41.1 million, or $1.72 per diluted share.

AeroVironment released its financial results after the markets closed on June 29. Shares opened June 30 at $105.60, down 3.9% from the previous day’s close, and then dropped another 8% by midday, when the stock was hovering at around $97.

Over the last six months, AeroVironment has seen big gains, and trades nearly 30% higher than its price on Dec. 16, 2020.

The drop in net income in the most recent earnings report could be attributed to that $9.3 million legal accrual as well as a $8.4 million loss related to an investment made by HAPSMobile, the company said.

Despite the drop in income, AeroVironment CEO Wahid Nawabi said he is extremely happy with the company’s performance and growth.

“AeroVironment again delivered on its financial, operational and strategic commitments, despite the continued macroeconomic challenges in fiscal year 2021,” Nawabi said during the company’s earnings call.

AeroVironment’s record revenue came in large part due to acquisitions the company made in 2021. In the fourth quarter, AeroVironment had revenue of $136 million, up around half a percent from a year earlier.

The slight increase in revenue could be attributed to AeroVironment’s acquisition of Arcturus UAV, as the company saw a $15.8 million increase from its new segment.

“Our new medium UAS product line is the result of our acquisition of Arcturus UAV, which provides group two and three UAS’s,” Nawabi said.

AeroVironment acquired Arcturus in February, in a deal worth more than $400 million.

For the full fiscal year, AeroVironment delivered revenue worth $394.9 million, an 8% increase from the previous year.

AeroVironment also spent $45.4 million to acquire Telerob and another $30 million in February to acquire Intelligent Systems Group from Progeny Systems Corp. Both those deals have closed, Nawabi said.

With those three acquisitions in place, AeroVironment says it expects revenue between $560 and $580 million in fiscal year 2022, which would be at least a 40% increase from the previous year.

“Our good growth portfolio is rich with opportunity. Our intelligent robotic systems in the air, on the ground, and in the water will work together to achieve mission success faster, safer and more cost effectively than otherwise possible,” Nawabi said. “In summary, our expanded portfolio gives us potential access to as much as $450 million. … Our three acquisitions significantly expand our revenue profile and growth.”

The company made news in other ways this year, as AeroVironment has been a major part of the current Mars expedition. The Perseverance rover carries a drone helicopter called Ingenuity, which was designed and built by AeroVironment in Simi Valley.

“We look forward to continued success with ingenuity on Mars, as well as supporting emerging opportunities, and the new category of robotic aircraft for planetary exploration,” Nawabi said during the June 29 earnings call.

AeroVironment also changed its headquarters location from Simi Valley to Arlington, Virginia on June 15. The company says it will maintain its current operations in Ventura County.

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