AeroVironment, Inc (AVAV) Q1FY13 Earnings Call September 5, 2012, 4:30 pm ET Executives Steven Gitlin – Vice President of Investor Relations Tim Conver – Chairman, CEO Jikun Kim – CFO Analysts Michael Lewis – Lazard Capital Jeremy Devaney – BB&T Capital Markets Greg Konrad – Jefferies (Tim Cronin – Stevens) Noah Poponak – Goldman Sachs Patrick McCarthy – FBR Andrea James – Dougherty & Company Michael Ciarmoli – KeyBanc Capital Markets Mike Greene – The Benchmark Company Tyler Hojo – Sidoti & Company Presentation Operator
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For a list and description of such risks and uncertainties, see the reports we file with the Securities and Exchange Commission.Investors are cautioned not to place undue reliance on any forward-looking statements which speak only as the day on which they are made. We do not intend and undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The contents of this conference call contains time sensitive information that is accurate only as of today, September 5, 2012. The company undertakes no obligation to make any revision to the statements contained in our remarks or to update them to reflect the events or circumstances occurring after this conference call. We will now begin with remarks from Tim Conver. Tim Conver Thank you, Steve. On today's call, I'll review the quarter, our ongoing businesses and new business opportunities, keeping my comments shorter to allow for more time for questions. Jikun will then review financial result sand I'll return to discuss our view of the balance of the fiscal year. The main message of today's call is this: fiscal 2013 is unfolding consistent with our expectations. The risks we discussed in our last call remain but our positive view of the future has not changed. On our Q4 fiscal '12 earnings call in June, I said that we expected Q1 fiscal '13 revenue to be about the same as it was in fiscal '12. And because we're staffed and operating for continued growth, we expected a net loss for the quarter. This is essentially what happened, although actual revenue of $58.7 million was $3 million less than last year. On the bottom line we had a net loss per share of $0.06. Backlog increased 6% quarter-over-quarter and now we have visibility into about 70% of our revenue guidance midpoint for the fiscal year.
The $3 million difference in Q1 revenue is attributable to timing and does not affect our plan for the year.Over the past several years, we've seen consistently low Q1 revenue as a result of customer order patterns. This is not indicated diminished demand for our products and services, nor has it reflected execution issues. We expect that a broadening of our customers, markets and solutions over time will ultimately help to normalize quarterly performance. But until that happens, this dynamic will likely continue. Now for a brief summary of our business: our unmanned airplane systems segment focuses on affordable and reliable solutions that use airborne platforms to provide customers with a high-valuable vantage point for obtaining critical information and communications relay. Our switch blade will provide troops with a unique, high-precision, minimal collateral damage capability to strike back at threats. Our business benefits from five growth drivers, all of which continue to contribute to our results. Some of these growth drivers enable us to maintain leadership in our existing businesses while others enable us to grow into new markets and to establish entirely new businesses in support of our long-term growth plans. Let's look at activity in Q1 and opportunities beyond to illustrate this growth model in action in our UAS business. The first driver is the sale of more products to existing customers. We see continued demand for our family of smaller unmanned aircraft systems like Raven, Puma and Wasp AE. Wasp AE transitioned into the Air Force Batman program in Q1 and we expect adoption by other customers to broaden its role in our family of small UAS. We continue to receive promising feedback on Shrike, our new VTOL solution, and believe that it will become a more significant contributor to UAS revenue. In August, we received additional funding of $16.5 million from the government fiscal year '12 Army Raven contract. Second, providing services to support our growing installed base of products and customers; in July we received a $6.8 million order from the Army for contractor logistic support services. Read the rest of this transcript for free on seekingalpha.com