VANCOUVER, BC, April 22, 2021 /CNW/ – Avcorp Industries Inc. (TSX: AVP) (the “Company” or “Avcorp”) is providing today guidance with respect to its upcoming interim financial results as well as certain financial information pertaining to the anticipated long term business activity, operations and anticipated results. The guidance and forward-looking financial information contained herein is based on the reasonable belief of management, subject to the risks and cautionary statements outlined below under the heading “Forward Looking Statements”. The guidance provided herein has been approved by the board of directors on April 22nd, 2021.
Industry Overview
The onset of the global pandemic has significantly impacted the demand for travel as the various governments announced restrictions to curb the COVID-19 virus and variant progression. The 737 MAX grounding had also caused significant drop in revenue for the Company’s Boeing programs in the proceeding 2 years.
Looking ahead and following the US Federal Aviation Administration and other aviation regulators around the world rescinding the ban on 737 MAX; deliveries and productions rates have increased and are expected to gradually increase through early 2022. As the vaccination efforts around the world gain momentum, there is strong recovery observed in passenger volume in certain parts of the world, particularly in the western countries. Current forecasts from IATA and the OEM’s indicate recovery, in terms of travel demand is likely to recover by 2023-2024. Based on this information, the Company providing this financial guidance and long term forecasts.
Avcorp continues to focus on liquidity, debt management, productivity improvements and opportunities within sustainable technologies to achieve full potential as the industry recovers from COVID 19 impact.
Q1 Financial Results
For the first quarter ended March 31, 2021, Avcorp is forecasting revenues of $24 million split 46% commercial aviation and 54% defence. As at the quarter end, the Company order backlog was $393 million split as to 83% commercial and 17% defence. For the period the Company is forecasting EBITDA of $20 million.
2021 figures include a one time claim settlement.
2022-2025 figures include management’s best projections of new contract awards.
The long term forecasted revenue and anticipated EBITDA are based on management’s expectations for new contracts being awarded from existing customers together with the existing work backlog. The actual results may differ materially from the forecast and the Company’s results are subject to inherent risks which may have an impact on these financial results.
About Avcorp
The Avcorp Group designs and builds major airframe structures for some of the world’s leading aircraft companies, including BAE Systems, Boeing, Bombardier, Lockheed Martin and Subaru Corporation. The Avcorp Group has more than 60 years of experience, over 500 skilled employees and 636,000 square feet of facilities. Avcorp Structures & Integration located in Delta British Columbia, Canada is dedicated to metallic and composite aerostructures assembly and integration; Avcorp Engineered Composites located in Burlington Ontario, Canada is dedicated to design and manufacture of composite aerostructures, and Avcorp Composite Fabrication located in Gardena California, USA has advanced composite aerostructures fabrication capabilities for composite aerostructures. The Avcorp Group offers integrated composite and metallic aircraft structures to aircraft manufacturers, a distinct advantage in the pursuit of contracts for new aircraft designs, which require lower-cost, light–weight, strong, reliable structures. Comtek Advanced Structures Ltd., at our Burlington, Ontario, Canada location also provides aircraft operators with aircraft structural component repair services for commercial aircraft.
Avcorp Composite Fabrication Inc. is wholly owned by Avcorp US Holdings Inc. Both companies are incorporated in the State of Delaware, USA, and are wholly owned subsidiaries of Avcorp Industries Inc.
Comtek Advanced Structures Ltd., incorporated in the Province of Ontario, Canada, is a wholly owned subsidiary of Avcorp Industries Inc.