Moog Inc. (NYSE: MOG.A) (NYSE: MOG.B) today announced second quarter earnings of $23.7 million, and earnings per share of $.55, down 17% from last year’s second quarter. Sales of $453 million were down 3% from a year ago. This is the first quarter in 14 years that the Company has been unable to report an increase in quarterly earnings. The Company’s situation reflects the impact of the global economic recession, particularly as it affects the Company’s industrial business in Europe and Asia.
The Space and Defense segment had a very strong quarter with sales of $68 million. Last year’s second quarter had the benefit of extraordinary sales volume on the Driver Vision Enhancer system for the MRAP vehicles, which provided $18 million in sales. That program is now 10% of that level, but most other Space and Defense product lines had increased sales. Sales of controls for satellites were up 17%. Revenue in launch vehicles, strategic and tactical missiles, and missile defense were, in total, up 19%. Sales of defense controls, other than the Driver Vision Enhancer, were up 69%, reflecting increased activity on the Stryker mobile gun system and a number of European platforms. The Constellation Program, NASA’s replacement for the Space Shuttle system, experienced a temporary slowdown while NASA develops its requirements for the Orion Crew Vehicle.
Total Aircraft sales in the quarter of $162 million were unchanged from a year ago. Military aircraft sales of $107 million were up 9%. Production activity increased on the F-18 Fighter, the V-22 Tilt Rotor aircraft and the Blackhawk helicopter. Revenues on the F-35 Joint Strike Fighter development program are winding down. Much of the development work is complete. The flight test aircraft for two configurations of the F-35 are in the air and the Company’s flight control actuation systems are performing very well. Military aftermarket sales in the quarter increased 26% to $35.8 million.
The Company’s commercial aircraft sales in the quarter, at $53.3 million, were down $10 million from last year. Most of this change was the result of lower sales to Boeing Commercial. Activity on the 7-series production aircraft has slowed somewhat and the production ramp up on the new 787 airplane has been delayed. Revenue on business jet programs actually increased slightly in the quarter, but commercial aftermarket sales at $18.8 million were down 16% from a year ago.
The Industrial Systems segment is the part of the Company most affected by the global industrial recession. Sales in the quarter of $105 million were down 20% from a year ago. Sales of controls for plastic making machinery were down 59% and metal forming was down 45%. Many of the Company’s customers for these products are suppliers to the auto and construction industries all around the globe, and demand for their products has slowed dramatically. On a more positive note, power generation sales were up 32% from a year ago and test equipment sales were up 16%.
Sales for the Components Group of $85 million were at the same level as last year’s second quarter. Within the same sales total, however, there were some big swings. Total sales of aircraft and space and defense products were up 16% from a year ago. Marine product sales were about the same as last year but medical and industrial product sales were down 15% and 29%, respectively. The biggest sales increase was in military aircraft. Sales were up 35% to $26 million driven by the Guardian program. The Guardian system is a Northrop Grumman program which protects aircraft from shoulder fired missiles.
The Medical Devices segment had sales of $34 million, a 50% improvement over the same quarter last year. Of the $11 million increase, $6.7 million was revenue from the recently acquired companies AITECS and Ethox. Sales in the quarter of intravenous and enteral pumps were up 30% and administration set revenues were up 24%.
The Company’s twelve month backlog of $913 million is up 6% from a year ago.
The Company has confirmed the earnings guidance it provided on April 9th with a slight modification to sales. Total sales for fiscal ’09 are now projected at $1.841 billion with net earnings forecasted at $83.5 million, and earnings per share estimated at $1.95 with a range of plus or minus $.20.
“Last year our Industrial Systems segment was our biggest profit producer,” said R. T. Brady, Chairman and CEO. “Despite a slowdown in some major industrial markets, the segment will be profitable this year, but not at the same level. On the positive side, our Military Aircraft and Space and Defense product lines, including those in the Components Group, are performing very well. As a result, in the midst of a global economic recession, we hope to earn over $83 million, or 4.5% of sales.”
Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, marine and medical equipment. Additional information about the company can be found at www.moog.com.