Cubic Corp. Falls Short on Earnings

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Cubic Corp. (NYSE: CUB) reported fiscal fourth-quarter financial results before markets opened on Monday. The company said that it had a net loss of $0.29 per share and $406.6 million in revenue, versus consensus estimates from Thomson Reuters that called for $0.17 in earnings per share (EPS) and $390.3 million in revenue. The same period from last year had $0.74 in EPS and $425.92 million in revenue.

Sales from recent acquisitions, which were all in the Cubic Global Defense (CGD) Systems segment, for the fourth quarter of fiscal 2016 were $36.2 million compared to $23.2 million during the same quarter last year. Sales decreased for the quarter from CGD Systems and  CGD Services, and were virtually unchanged for Cubic Transportation Systems (CTS).

Overall the company missed its previous expectations on the bottom-line mainly due to funding delays from the U.S. Department of Defense, specifically for higher margin orders in the Mission Solutions and Training Systems businesses within the CGD Systems segment.

In terms of the outlook for fiscal 2017, the company expects EPS to be in the range of $0.40 to $0.80 and sales to be between $1.505 billion and $1.555 billion. The consensus estimates are calling for $0.51 in EPS and $1.45 billion in revenue.

On the books, cash and cash equivalents totaled $197.13 million at the end of the quarter, versus $216.48 million in the same period from last year.

Bradley H. Feldmann, President and CEO of Cubic Corp., commented:

While we are disappointed by the shortfall in our fiscal year 2016 financial results, we fully anticipate the delayed orders will be received in fiscal year 2017. As part of our One Cubic initiative, we will complete our ERP implementation which will position us for stronger growth and greater efficiency going forward.

Shares of Cubic were last trading down nearly 11% at $43.92, with a consensus analyst price target of $48.60 and a 52-week trading range of $39.50 to $49.93.