Surging profits from its aircraft electronics and lighting business helped Astronics’ third-quarter earnings jump by 45 percent.
The East Aurora-based company also moved to bolster its aircraft electronics and lighting business in Europe with a $28.5 million deal to buy PGA Electronic, a French company that makes seat motion and lighting systems for business jets and first-class passenger seats, along with in-flight entertainment and communications systems.
The acquisition, which is expected to close in early December, will extend Astronics’ presence in the European market, especially for business jets. PGA had about $44 million in sales during the fiscal year that ended in August, with more than 90 percent of its revenues coming from the European market. PGA employs about 190 workers at its factory in Chateauroux, France.
The acquisition will give Astronics its first physical presence in Europe. “This is the first time we’ve put stakes in the ground there,” said Peter Gundermann, Astronics’ chief executive officer, during a conference call Tuesday. “One of our opportunities here is to help PGA expand its footprint outside Europe and into North America.”
“The acquisition complements well our other lighting, cabin electronics and communication capabilities,” Gundermann said. It also pushes Astronics into a new high-end market in providing products for private jets used by what the industry calls “very, very important people.”
Astronics’ profits during the third quarter jumped to $7.2 million, or 39 cents per share, from $4.9 million, or 27 cents per share, topping analyst forecasts by a penny.
The company’s sales rose by 30 percent to $89.7 million from $68.9 million, fueled by a 74 percent surge in revenues from its aircraft lighting and safety products, combined with double-digit growth from its electrical power products.
“It was a pretty good quarter,” Gundermann said. “Our markets and our product lines remain strong.”
Almost three-quarters of the sales increase came from the company’s mid-July acquisition of Peco Inc., which accounted for nearly all of the growth in Astronics’ lighting and safety product line. Excluding the impact from the acquisition of Peco, an Oregon company that makes the aircraft cabin lighting and air flow components located above passenger seats, Astronics’ sales from its existing businesses grew by 7 percent.
Sales from Astronics long-struggling test systems business in Florida fell by 31 percent to $2.2 million, although cost-cutting helped reduce the operating loss from that business to $745,000, compared with $1.1 million a year ago.
Astronics also nudged its revenue forecast for the entire year slightly higher, saying it now expects sales to range between $335 million and $345 million, up from its July guidance of $325 million to $340 million and in line with analyst forecasts of $339 million. That would be about a 27 percent increase from last year.
Company shares were down 50 cents, or about 1 percent, at $47.55 in early trading Tuesday.