Kaman Corp (KAMN) Reports In-Line Q2 EPS; Boosts Midpoint of FY14 Distribution Sales, Op. Income Outlook

Kaman Corp (NYSE: KAMN) reported Q2 EPS of $0.60, in-line with the analyst estimate of $0.60. Revenue for the quarter came in at $459 million versus the consensus estimate of $471.25 million.

Outlook

We are raising the low end of the sales and operating income range for Distribution from $1,180 million to $1,190 million and 4.7% to 4.8%, respectively. This reflects the improved performance we have seen in our base business and the acquired assets of B.W. Rogers. At Aerospace, we are maintaining our sales expectations for the year; however, we have lowered the top end of our range for operating income from 17.0% to 16.7%. The reduction in the range is due to a shift in the anticipated product mix for the year. Finally, we have increased our Free Cash Flow* expectations for the year, largely reflecting lower than expected capital expenditures. Our updated outlook for 2014 is as follows:

• Distribution:
  • Sales of $1,190 million to $1,220 million
  • Operating margins of 4.8% to 5.2%

• Aerospace:
  • Sales of $640 million to $660 million
  • Operating margins of 16.5% to 16.7%
• Interest expense of approximately $13.5 million
• Corporate expenses of approximately $52 million
• Estimated annualized tax rate of approximately 35%
• Depreciation and amortization expense of approximately $38 million
• Capital expenditures of $30 million to $35 million
• Free cash flow* in the range of $50 million to $55 million

For earnings history and earnings-related data on Kaman Corp (KAMN) click here.

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