Moog's first-quarter profits soared by 55 percent as strong growth in aircraft and military sales helped earnings by the Elma maker of motion-control equipment to zoom past analyst forecasts.
Because of the big jump in earnings, Moog on Monday also hiked its earnings forecast for the fiscal year that ends in September by 5 cents per share, to $2.75 per share, up by 17 percent from a year ago.
Robert T. Brady, Moog's CEO, said Monday that the big jump in first-quarter profits gave the company a "flying start" for its fiscal year.
"We're optimistic that this momentum will carry us through the rest of the year," he said.
Moog's profits jumped to $33.4 million, or 73 cents a share, from $21.6 million, or 47 cents a share, a year ago, easily topping analyst forecasts that averaged 63 cents per share.
The company's sales rose by 12 percent, to $554 million, from $495 million a year earlier, and topping analyst forecasts of $541 million.
Much of the profit growth came from Moog's space and defense controls business, where operating profits more than doubled, to $15.8 million, and sales jumped by 38 percent, to $96 million. About two-thirds of the revenue increase came from a $15 million spike in sales of the company's Driver Vision Enhancer systems for the military, which generated nearly no revenue a year ago, Brady said.
Moog's aircraft equipment sales grew by 12 percent, to $196 million, fueled by a 30 percent jump in commercial aircraft revenue as hardware deliveries for Boeing's new 787 commercial jet increased and sales of replacement parts swelled by 42 percent. The aircraft business' operating profits rose by 15 percent, to $20.2 million.
While Boeing Co. has delayed the first deliveries of the 787 until the third quarter, the aircraft-maker continues to produce the Dreamliner. Brady, however, said future production schedules could be affected by the delay.
Operating profits from Moog's industrial business strengthened by 28 percent, to $14.4 million, as sales improved by 5 percent, to $144 million. Moog said sales of its legacy products, which include equipment used in the capital equipment, power generation and simulation markets, grew by 24 percent as those lines continued to rebound from their recession lows.
The newest part of the industrial business -- wind turbine components -- had a weak quarter, with sales dropping by more than a quarter, to about $30 million, largely because of lower sales from China, Brady said.
Sales of components inched up by 2 percent, to $86 million, but the unit's operating profits jumped by 22 percent, to $14.8 million.
The one weak part of Moog's business continued to be its medical products segment, which had an operating loss of $1.5 million during the quarter, down from an operating profit of $139,000 a year ago, despite an 11 percent rise in sales, to $33 million.
Brady said new products being developed by the medical device unit are taking longer than expected to win approval from the U.S. Food and Drug Administration. The company also is building its own direct sales organization. The medical unit's new factory in Costa Rica, which has had some start-up production problems, is working through those issues and has been steadily improving its performance, Brady said.
"I think we're on track," he said of the medical device business.
Monday, Moog's stock rose by 71 cents, or 1.7 percent, to close at $42.84.