Shares of Wesco Aircraft Holdings Inc. fell more than 15 percent Tuesday morning, a day after the aircraft parts provider reported a drop in fiscal second-quarter profit and lowered its full-year guidance.
The Valencia company late Monday reported net income of $19.7 million (21 cents a share), compared with $21.9 million (24 cents) in the same period a year earlier. Revenue rose 3.5 percent to $182 million.
Excluding one-time items, net income was 22 cents a share, still lower than analysts’ expectations for adjusted earnings of 26 cents on revenue of nearly $192 million.
Looking forward, Wesco expects adjusted full-year earnings of 92 to 97 cents, down from $1.03 to $1.07. It expects full-year revenue of $740 million to $760 million, compared with earlier guidance of $760 million to $785 million. The Wall Street consensus was for full-year earnings of $1.06 a share on revenue of nearly $785 million.
Wesco is considered one of the world's largest providers of aircraft hardware, bearings, tools, electronic components and machined parts.
“As we have made progress in the implementation of several new contracts, we have found that the level of existing inventory at some customers was higher than expected,” said Chief Executive Randy Snyder in a statement. “It will take longer to reduce the inventory on-hand and ramp-up sales of products provided by Wesco. Because of this, we believe it is appropriate to revise our financial outlook for the full year based on what we are seeing today.”
Shares were down $2.51, or more than 15 percent, to $12.76 in midday trading on the New York Stock Exchange.