AAR profit plunges on lower commercial air demand

WOOD DALE, Ill.

Aerospace supplier and service provider AAR Corp. said Wednesday its fiscal third-quarter profit shrank 42 percent due to a falloff in demand from commercial airlines and a customer bankruptcy filing.

The company earned $9.9 million, or 26 cents per share, compared with $17.2 million, or 43 cents per share, a year ago. AAR said Mesa Air Group's bankruptcy filing hurt its earnings by about 10 cents per share. AAR has a deal with Mesa to supply parts and provide aircraft maintenance.

Revenue fell to $309.6 million from $338.8 million in the fiscal third quarter of 2009.

Sales to defense and government customers were down 1 percent from a year earlier. Sales to commercial customers declined 15 percent.

"The uptick in sales to commercial customers has been slow to materialize although we began to see a gradual increase in demand from these customers in late February that has continued," Chairman and CEO David P. Storch said in a statement.

Shares fell 71 cents, or 2.8 percent, to close Wednesday at $24.93.