Wed, May 7, 9:02 PM (16 days ago)
**VSE Corporation (VSEC) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $256.0 million, up 58% YoY, driven by acquisitions (TCI and Kellstrom Aerospace), new distribution contracts, and increased market activity. - **Operating Income:** $24.5 million, up 57% YoY, due to revenue growth and favorable sales mix. - **Net Loss:** $(8.97) million, including a $33.7 million impairment loss on Fleet assets held-for-sale. - **Cash Flow:** Net cash used in operating activities was $(46.6) million, an improvement of $32.4 million YoY. - **Earnings per Share (EPS):** Basic EPS from continuing operations was $0.68, diluted EPS was $0.67. **Profit Margins:** - **Gross Margin:** Not explicitly stated, but implied by the increase in operating income. - **Operating Margin:** Approximately 9.6% (Operating Income / Revenue). **Cash Flow:** - **Operating Cash Flow:** Negative $(46.6) million, improved from $(79.1) million YoY. - **Investing Cash Flow:** Negative $(0.1) million, down from positive $33.4 million YoY due to lower proceeds from asset sales. - **Financing Cash Flow:** Positive $28.2 million, down from $48.3 million YoY due to lower net borrowings. **Earnings Changes:** - **Year-over-Year Change:** Revenue up 58%, Operating Income up 57%, Net Loss improved by $2.3 million. - **Quarter-over-Quarter Change:** Not explicitly stated, but implied by the YoY changes. **Trends and Uncertainties:** - **Positive Trends:** Strong program execution, market growth, and strategic acquisitions. - **Uncertainties:** Potential impacts from tariffs, interest rate changes, and integration of new acquisitions. - **Future Operations:** Focus on higher-margin aviation aftermarket parts distribution and MRO businesses. **Impact of Future Operations:** - **New Credit Agreement:** Provides lower interest rates, greater flexibility, and increased borrowing capacity. - **Acquisitions:** TCI and Kellstrom Aerospace acquisitions align with VSE's core business and expand market reach. - **Divestitures:** Sale of Fleet and Federal and Defense segments to focus on core aviation aftermarket businesses. **Summary:** VSE Corporation reported strong revenue growth and improved operating income in Q1 2025, driven by strategic acquisitions and market expansion. However, the company reported a net loss due to impairment charges related to the sale of the Fleet segment. The company's cash flow from operations improved, and it secured a new credit agreement to support future growth. VSE continues to focus on its core aviation aftermarket businesses and strategic acquisitions to drive future growth.