- CAE Inc (NYSE:CAE) reported third-quarter FY22 revenue growth of 2% year-over-year to C$848.7 million.
- Sales by segments: Civil Aviation Training Solutions C$390.1 million (-5% Y/Y); Defence and Security C$426.5 million (+42% Y/Y); and Healthcare C$32.1 million (-73% Y/Y).
- Order intake for the quarter increased by 94% Y/Y to C$1.38 billion, and the total backlog increased by 17% Y/Y to C$9.18 billion.
- The Civil book-to-sales ratio was 1.93x for the quarter and 1.20x for the last 12 months, and the Civil backlog was C$4.6 billion.
- Adjusted EPS decreased to C$0.19 from C$0.22 in 3Q21.
- The gross margin expanded by 107 bps to 28.6%. The operating income declined 21% Y/Y to C$65.5 million, and the margin contracted by 225 bps to 7.7%.
- Adjusted segment operating income stood at C$112.7 million (+16% Y/Y), and the margin for the quarter was 13.3%, up by 160 bps.
- Net cash provided by operating activities was C$309.6 million for the quarter, compared to C$234.8 million a year ago. Free cash flow was C$282.1 million.
- At the end of the quarter, net debt was C$2.31 billion for a net debt-to-capital ratio of 36.5%.
- Outlook: The company is currently targeting to reach a consolidated adjusted segment operating margin of approximately 17% by the time its markets are generally recovered, with steady room for further improvement thereafter.
- The company expects pandemic-related headwinds to persist for some time, including supply chain disruptions.
- Price Action: CAE shares traded lower by 0.27% at $25.64 on the last check Friday.
