Canada's CAE Q1 adjusted EPS beats estimates on defense segment strength
CAE•Outlook
- CAE sees fiscal 2027 revenue growing at a low-single digit percentage rate
- Company expects fiscal 2027 adjusted segment operating income margin of 14.6% to 15.1%
- CAE forecasts fiscal 2027 adjusted EPS of C$1.21 to C$1.28
Overview
- Canada simulation and training provider's fiscal Q1 revenue rose 6.8%, beating analyst expectations
- Adjusted EPS for fiscal Q1 was flat yr/yr but beat analyst expectations
- Company repurchased 1.1 mln shares for C$39 mln under normal course issuer bid
Result drivers
- Civil profitability pressure - Civil segment profitability declined due to higher selling, general and administrative expenses, lower simulator sales, and impacts from the Middle East conflict
- Defense growth - Defense segment revenue and profitability rose, driven by higher activity and program efficiencies in North America
- Transformation costs - Company-wide restructuring and transformation costs weighed on operating income
