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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): June 23, 2020

 

AEROVIRONMENT, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-33261

 

95-2705790

(State or other jurisdiction of

 

(Commission File Number)

 

(I.R.S. Employer Identification No.)

incorporation or organization)

 

 

 

 

900 Innovators Way

 

 

Simi Valley, California

 

93065

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: (805) 520-8350

 Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.0001 per share

AVAV

The NASDAQ Stock Market LLC

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company   

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   

Item 2.02.  Results of Operations and Financial Condition

 

On June 23, 2020, AeroVironment, Inc. (the “Company”) issued a press release announcing fourth quarter financial results for the period ended April 30, 2020, a copy of which is attached hereto as Exhibit 99.1.

Item 7.01 Regulation FD Disclosure

The information under Item 2.02 above is incorporated herein by reference.

Attached as Exhibit 99.2 hereto is a presentation containing additional information regarding the Company’s fourth quarter and full fiscal 2020 financial results for the period ended April 30, 2020. A copy of the presentation is also available on the investor relations section of the Company’s website at https://investor.avinc.com/events-and-presentations. The information contained on the Company’s website is not incorporated by reference into, and does not form a part of, this Current Report on Form 8-K.

 

In addition to historic information, this report, including the exhibits, contains forward-looking statements regarding events, performance and financial trends. Various factors could affect future results and could cause actual results to differ materially from those expressed in or implied by the forward-looking statements. Some of those factors are identified in the exhibits, and in our periodic reports filed with the Securities and Exchange Commission.

The information in this Current Report on Form 8-K, including the exhibits, is furnished pursuant to Items 2.02 and 7.01 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing of AeroVironment, Inc. under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01.  Financial Statements and Exhibits

 

(d)  Exhibits.

 

Exhibit

 

 

Number

 

Description

99.1

 

Press release issued by AeroVironment, Inc., dated June 23, 2020.

99.2

Presentation regarding AeroVironment, Inc.’s fourth quarter and full fiscal 2020 financial results dated June 23, 2020.

101.INS

XBRL Instance Document - the instance document does not appear in Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Label Linkbase Document

101.PRE

XBRL Taxonomy Presentation Linkbase Document

104

Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

2

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

AEROVIRONMENT, INC.

 

 

 

 

 

 

Date: June 23, 2020

By:

/s/ Wahid Nawabi

 

 

Wahid Nawabi

 

 

President and Chief Executive Officer

3

Exhibit 99.1

AeroVironment, Inc. Announces Fiscal 2020 Full Year and Fourth Quarter Results

SIMI VALLEY, Calif., June 23, 2020 — AeroVironment, Inc. (NASDAQ: AVAV), a global leader in unmanned aircraft systems (UAS), today reported financial results for its full year and fourth quarter ended April 30, 2020.

Record fourth quarter and full year revenue of $135.2 million and $367.3 million, an increase of 54 percent and 17 percent year-over-year, respectively
Fourth quarter diluted earnings per share from continuing operations and non-GAAP diluted earnings per share from continuing operations of $0.73 and $0.75, an increase of 47 cents and 49 cents year-over-year, respectively

Record funded backlog of $208.1 million, providing strong momentum toward a fourth consecutive year of profitable growth

“Our team delivered outstanding results in our fourth quarter and full fiscal year 2020. We established new records for highest quarterly revenue, highest fiscal year revenue, and highest funded backlog for the full fiscal year 2020. With continued focus on our business strategy, coupled with excellent execution by our committed and talented team, we delivered our third consecutive year of profitable, double-digit topline growth,” said Wahid Nawabi, AeroVironment president and chief executive officer. “Strong growth in small unmanned aircraft systems revenue reflects continued global demand for our market leading UAS solutions, while significant progress in tactical missile systems and HAPS advances our strategy for long-term value creation.”

“We achieved numerous significant milestones this fiscal year, including successfully completing initial flight tests of the HAWK30 solar-HAPS system, securing the largest U.S. Army LMAMS order to date for our Switchblade system, successfully demonstrating a larger variant of Switchblade, progressing in the development of next generation autonomy capabilities and growing our international customer base to 50 allied nations. Presented with the unprecedented circumstances driven by the COVID-19 pandemic, our team continued to deliver exceptional results while maintaining a strong focus on safety and serving our customers around the world. We continue to build on our momentum as we enter fiscal year 2021 and are confident in our ability to enhance shareholder value over the near- and long-term,” Mr. Nawabi added.

FISCAL 2020 FOURTH QUARTER RESULTS

Revenue for the fourth quarter of fiscal 2020 was $135.2 million, an increase of 54% from the fourth quarter of fiscal 2019 revenue of $87.9 million. The increase in revenue was due to an increase in product sales of $37.4 million and an increase in service revenue of $9.9 million.

Gross margin for the fourth quarter of fiscal 2020 was $53.2 million, an increase of 44% from the fourth quarter of fiscal 2019 gross margin of $37.0 million. The increase in gross margin was primarily due to an increase in product margin of $10.8 million and an increase in service margin of $5.3 million. As a percentage of revenue, gross margin decreased to 39% from 42%. The decrease in gross margin percentage was primarily due to an unfavorable product mix and an increase in intangible asset amortization expense of $0.7 million associated with our acquisition of Pulse Aerospace in June 2019.

1


Income from continuing operations for the fourth quarter of fiscal 2020 was $21.3 million, an increase of $16.2 million from the fourth quarter of fiscal 2019 income from continuing operations of $5.1 million. The increase in income from continuing operations was primarily a result of an increase in gross margin of $16.1 million and a decrease in selling, general and administrative (“SG&A”) expense of $3.9 million, partially offset by an increase in research and development (“R&D”) expense of $3.9 million. SG&A expense for the fourth quarter of fiscal 2019 included impairment charges of $4.4 million related to the long-lived assets of our commercial UAS Quantix solution.

Other income, net, for the fourth quarter of fiscal 2020 was $1.2 million compared to $2.8 million for the fourth quarter of fiscal 2019. The decrease in other income, net was primarily due to a decrease in income from transition services performed on behalf of the buyer of the discontinued EES business.

Provision for (benefit from) income taxes for the fourth quarter of fiscal 2020 was a provision of $2.6 million compared to a benefit of $0.1 million for the fourth quarter of fiscal 2019. The increase in provision for income taxes was primarily due to the increase in income before income taxes.

Equity method investment loss, net of tax, for the fourth quarter of fiscal 2020 was $2.1 million compared to $1.9 million for the fourth quarter of fiscal 2019 primarily associated with our investment in HAPSMobile, Inc. joint venture formed in December 2017.

Net income attributable to AeroVironment for the fourth quarter of fiscal 2020 was $17.5 million compared to $5.7 million for the fourth quarter of fiscal 2019.

Earnings per diluted share from continuing operations attributable to AeroVironment for the fourth quarter of fiscal 2020 was $0.73 compared to $0.26 for the fourth quarter of fiscal 2019.

Non-GAAP earnings per diluted share from continuing operations was $0.75 for the fourth quarter of fiscal 2020 compared to $0.26 for the fourth quarter of fiscal 2019.

FISCAL 2020 FULL YEAR RESULTS

Revenue for fiscal 2020 was $367.3 million, an increase of 17% from fiscal 2019 revenue of $314.3 million. The increase in revenue was primarily due to an increase in product sales of $44.7 million and an increase in service revenue of $8.3 million.

Gross margin for fiscal 2020 was $153.1 million, an increase of 19% from fiscal 2019 gross margin of $128.4 million. The increase in gross margin was primarily due to an increase in product margin of $19.0 million and an increase in service margin of $5.7 million. As a percentage of revenue, gross margin increased to 42% from 41%. The increase in gross margin percentage was primarily due to an increase in the proportion of product sales to total revenue, partially offset by an increase in intangible asset amortization expense of $2.5 million associated with our acquisition of Pulse Aerospace in June 2019.

Income from continuing operations for fiscal 2020 was $47.1 million, an increase of 39% from fiscal 2019 income from continuing operations of $33.8 million. The increase in income from continuing operations was primarily a result of an increase in gross margin of $24.7 million and a decrease in SG&A expense of $0.9 million, partially offset by an increase in R&D expense of $12.2 million. SG&A expense for fiscal 2019 included impairment charges of $4.4 million related to the long-lived assets of our commercial UAS Quantix solution.

Other income, net for fiscal 2020 was $5.5 million compared to $16.7 million for fiscal 2019. The decrease in other income, net was primarily due to a one-time gain from a litigation settlement of $0.26 per diluted share in fiscal 2019 and a decrease in income from transition services performed on behalf of the buyer of the discontinued EES business.

Provision for income taxes for fiscal 2020 was $5.8 million compared to $4.6 million for fiscal 2019. The increase in provision for income taxes was primarily due to an increase in income before income taxes.

2


Equity method investment loss, net of tax for fiscal 2020 was $5.5 million compared to $3.9 million for fiscal 2019. The equity method loss is primarily associated with our investment in the HAPSMobile Inc. joint venture formed in December 2017.

Net income attributable to AeroVironment for fiscal 2020 was $41.1 million compared to $47.4 million for fiscal 2019. Fiscal 2019 included a one-time gain from a litigation settlement of $0.26 per diluted share.

Earnings per diluted share from continuing operations attributable to AeroVironment for fiscal 2020 was $1.72 compared to $1.74 for fiscal 2019. Fiscal 2019 included a one-time gain from a litigation settlement of $0.26 per diluted share.

Non-GAAP earnings per diluted share from continuing operations for fiscal 2020 was $1.84 compared to $1.48 for fiscal 2019 which excludes a one-time gain from a litigation settlement of $0.26 per diluted share.

BACKLOG

As of April 30, 2020, funded backlog (remaining performance obligations under firm orders for which funding is currently appropriated to us under a customer contract) was $208.1 million compared to $164.3 million as of April 30, 2019.

FISCAL 2021 — OUTLOOK FOR THE FULL YEAR

For fiscal 2021, the Company expects to generate revenue between $390 million and $410 million, operating margin of between 12% and 12.5%, and earnings per diluted share of $1.65 to $1.85. This financial guidance assumes approximately 7% ownership of the HAPSMobile joint venture. The Company expects non-GAAP earnings per diluted share, which excludes amortization of acquired intangible assets, to be between $1.74 and $1.94.

The foregoing estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to our ability to obtain and retain government contracts, changes in the timing and/or amount of government spending, changes in the demand for our products and services, activities of competitors, changes in the regulatory environment, and general economic and business conditions in the United States and elsewhere in the world. Investors are reminded that actual results may differ materially from these estimates.

UPDATED CONFERENCE CALL AND PRESENTATION

In conjunction with this release, AeroVironment, Inc. will host a conference call today, Tuesday June 23, 2020, at 1:30 pm Pacific Time that will be webcast live. Wahid Nawabi, president and chief executive officer, Kevin P. McDonnell, chief financial officer and Steven A. Gitlin, vice president of investor relations, will host the call.

4:30 PM ET

3:30 PM CT

2:30 PM MT

1:30 PM PT

Investors may dial into the call by using the following updated telephone numbers, (877) 561-2749 (U.S.) or (678) 809-1029 (international) and providing the conference ID 3557035 five to ten minutes prior to the start time to allow for registration.

Investors with Internet access may listen to the live audio webcast via the Investor Relations page of the AeroVironment, Inc. website, http://investor.avinc.com. Please allow 15 minutes prior to the call to download and install any necessary audio software.

3


A supplementary investor presentation for the fourth quarter and full fiscal 2020 can be accessed at https://investor.avinc.com/events-and-presentations.

Updated Audio Replay Options

An audio replay of the event will be archived on the Investor Relations page of the company's website, at http://investor.avinc.com. The audio replay will also be available via telephone from Tuesday June 23, 2020, at approximately 4:00 p.m. Pacific Time through June 30, 2020, at 11:59 p.m. Pacific Time. Dial (855) 859-2056 (U.S.) or (404) 537-3406 (international) and provide the conference ID 3557035.

ABOUT AEROVIRONMENT, INC.

AeroVironment (NASDAQ: AVAV) provides customers with more actionable intelligence so they can proceed with certainty. Based in California, AeroVironment is a global leader in unmanned aircraft systems and tactical missile systems, and serves defense, government and commercial customers. For more information visit www.avinc.com.

FORWARD-LOOKING STATEMENTS

This press release contains “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” or words or phrases with similar meaning. Forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of our control, that may cause our business, strategy or actual results to differ materially from the forward-looking statements.

Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, reliance on sales to the U.S. government; availability of U.S. government funding for defense procurement and R&D programs; changes in the timing and/or amount of government spending; our ability to perform under existing contracts and obtain new contracts; risks related to our international business, including compliance with export control laws; potential need for changes in our long-term strategy in response to future developments; the extensive regulatory requirements governing our contracts with the U.S. government and international customers; the consequences to our financial position, business and reputation that could result from failing to comply with such regulatory requirements; unexpected technical and marketing difficulties inherent in major research and product development efforts; the impact of potential security and cyber threats; changes in the supply and/or demand and/or prices for our products and services; the activities of competitors and increased competition; failure of the markets in which we operate to grow; uncertainty in the customer adoption rate of commercial use unmanned aircraft systems; failure to remain a market innovator and create new market opportunities; changes in significant operating expenses, including components and raw materials; failure to develop new products; the extensive regulatory requirements governing our contracts with the U.S. government; risk of litigation, including but not limited to pending litigation arising from the sale of our EES business; the impact of our recent acquisition of Pulse Aerospace, LLC and our ability to successfully integrate it into our operations; product liability, infringement and other claims; changes in the regulatory environment; the impact of the outbreak related to the strain of coronavirus known as COVID-19 on our business operations; and general economic and business conditions in the United States and elsewhere in the world. For a further list and description of such risks and uncertainties, see the reports we file with the Securities and Exchange Commission. 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.

NON-GAAP MEASURES

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release also contains a non-GAAP financial measure. See in the financial tables below

4


the calculation of this measure, the reasons why we believe this measure provides useful information to investors, and a reconciliation of this measure to the most directly comparable GAAP.

- Financial Tables Follow –

5


AeroVironment, Inc.

Consolidated Statements of Operations (Unaudited)

(In thousands except share and per share data)

Three Months Ended

Year Ended

 

April 30,

April 30,

April 30,

April 30,

    

2020

    

2019

 

2020

    

2019

 

(Unaudited)

Revenue:

Product sales

$

97,101

$

59,696

$

256,758

$

212,089

Contract services

 

38,122

 

28,234

 

110,538

 

102,185

 

135,223

 

87,930

 

367,296

 

314,274

Cost of sales:

Product sales

 

56,887

 

30,331

 

139,131

 

113,489

Contract services

 

25,168

 

20,576

 

75,063

 

72,382

 

82,055

 

50,907

 

214,194

 

185,871

Gross margin:

 

 

Product sales

40,214

29,365

117,627

98,600

Contract services

12,954

7,658

35,475

29,803

53,168

37,023

153,102

128,403

Selling, general and administrative

 

16,344

 

20,277

 

59,490

 

60,343

Research and development

 

15,529

 

11,603

 

46,477

 

34,234

Income from continuing operations

 

21,295

 

5,143

 

47,135

 

33,826

Other income:

Interest income, net

 

1,111

 

1,426

 

4,828

 

4,672

Other income, net

 

75

 

1,339

 

707

 

11,980

Income from continuing operations before income taxes

 

22,481

 

7,908

 

52,670

 

50,478

Provision for (benefit from) income taxes

 

2,645

 

(83)

 

5,848

 

4,641

Equity method investment loss, net of tax

(2,077)

(1,873)

(5,487)

(3,944)

Net income from continuing operations

17,759

6,118

41,335

41,893

Discontinued operations:

(Loss) gain on sale of business, net of tax

(265)

38

(265)

8,490

Loss from discontinued operations, net of tax

(453)

(2,964)

Net (loss) income from discontinued operations

 

(265)

 

(415)

 

(265)

 

5,526

Net income

17,494

5,703

41,070

47,419

Net (income) loss attributable to noncontrolling interest

(23)

(21)

4

19

Net income attributable to AeroVironment, Inc.

$

17,471

$

5,682

$

41,074

$

47,438

Net income (loss) per share attributable to AeroVironment, Inc.—Basic

Continuing operations

$

0.74

$

0.26

$

1.74

$

1.77

Discontinued operations

(0.01)

(0.02)

(0.01)

0.23

Net income per share attributable to AeroVironment, Inc.—Basic

$

0.73

$

0.24

$

1.73

$

2.00

Net income (loss) per share attributable to AeroVironment, Inc.—Diluted

Continuing operations

$

0.73

$

0.26

$

1.72

$

1.74

Discontinued operations

(0.01)

(0.02)

(0.01)

0.23

Net income per share attributable to AeroVironment, Inc.—Diluted

$

0.72

$

0.24

$

1.71

$

1.97

Weighted-average shares outstanding:

Basic

 

23,849,575

 

23,718,030

 

23,806,208

 

23,663,410

Diluted

 

24,133,809

 

24,094,717

 

24,088,167

 

24,071,713

6


AeroVironment, Inc.

Consolidated Balance Sheets

(In thousands except share data)

April 30,

 

2020

2019

Assets

Current assets:

Cash and cash equivalents

$

255,142

$

172,708

Held-to-maturity short-term investments

 

 

150,487

Available-for-sale short-term investments

47,507

Accounts receivable, net of allowance for doubtful accounts of $1,190 at April 30, 2020 and $1,041 at April 30, 2019

 

73,660

 

31,051

Unbilled receivables and retentions

 

75,837

 

53,047

Inventories

 

45,535

 

54,056

Prepaid expenses and other current assets

 

6,246

 

7,418

Income taxes receivable

821

Total current assets

 

503,927

 

469,588

Held-to-maturity long-term investments

 

 

9,386

Available-for-sale long-term investments

15,030

Property and equipment, net

 

21,694

 

16,905

Operating lease right-of-use assets

8,793

Deferred income taxes

 

4,928

 

6,685

Intangibles, net

13,637

459

Goodwill

6,340

Other assets

 

10,605

 

5,821

Total assets

$

584,954

$

508,844

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

$

19,859

$

15,972

Wages and related accruals

 

23,972

 

18,507

Customer advances

 

7,899

 

2,962

Current operating lease liabilities

3,380

Income taxes payable

1,065

Other current liabilities

 

10,778

 

7,425

Total current liabilities

 

66,953

 

44,866

Deferred rent

 

 

1,173

Non-current operating lease liabilities

6,833

Other non-current liabilities

250

150

Deferred tax liability

29

Liability for uncertain tax positions

 

1,017

 

51

Commitments and contingencies

Stockholders’ equity:

Preferred stock, $0.0001 par value:

Authorized shares—10,000,000; none issued or outstanding at April 30, 2020 and April 30, 2019

 

 

Common stock, $0.0001 par value:

Authorized shares—100,000,000

Issued and outstanding shares—24,063,639 shares at April 30, 2020 and 23,946,293 shares at April 30, 2019

 

2

 

2

Additional paid-in capital

 

181,481

 

176,216

Accumulated other comprehensive income

 

328

 

2

Retained earnings

 

328,090

 

286,351

Total AeroVironment, Inc. stockholders’ equity

 

509,901

 

462,571

Noncontrolling interest

4

Total equity

509,901

462,575

Total liabilities and stockholders’ equity

$

584,954

$

508,844

7


AeroVironment, Inc.

Consolidated Statements of Cash Flows

(In thousands)

Year Ended April 30,

 

 

2020

    

2019

    

2018

 

Operating activities

Net income

$

41,070

$

47,419

$

17,647

Loss (gain) on sale of business, net of tax

265

(8,490)

Loss from discontinued operations, net of tax

2,964

3,887

Net income from continuing operations

41,335

41,893

21,534

Adjustments to reconcile net income from continuing operations to cash provided by operating activities from continuing operations:

Depreciation and amortization

 

9,888

 

7,669

 

5,982

Losses from equity method investments

5,487

3,944

1,283

Realized gain from sale of available-for-sale investments

(180)

Impairment of long-lived assets

4,398

255

Provision for doubtful accounts

 

388

 

(39)

 

977

Impairment of intangible assets and goodwill

1,021

Other non-cash gain, net

(703)

Non-cash lease expense

4,574

Loss (gain) on foreign currency transactions

 

1

 

38

 

(87)

Deferred income taxes

 

3,419

 

4,792

 

2,853

Stock-based compensation

 

6,227

 

6,985

 

4,956

(Gain) loss on sale of property and equipment

(71)

76

20

Amortization of debt securities

(1,423)

(1,506)

1,424

Changes in operating assets and liabilities, net of acquisitions:

Accounts receivable

 

(42,869)

 

25,821

 

11,070

Unbilled receivables and retentions

 

(22,790)

 

(36,175)

 

2,253

Inventories

 

8,855

 

(16,631)

 

1,192

Income tax receivable

821

(821)

Prepaid expenses and other assets

 

831

 

(2,401)

 

139

Accounts payable

 

3,127

 

(7,054)

 

5,736

Other liabilities

 

8,180

 

(4,043)

 

9,224

Net cash provided by operating activities of continuing operations

 

25,097

 

26,946

 

69,832

Investing activities

Acquisition of property and equipment

 

(11,220)

 

(8,896)

 

(9,563)

Equity method investments

(14,498)

(7,598)

(3,267)

Business acquisition, net of cash acquired

(18,641)

Proceeds from sale of business

31,994

Proceeds from sale of property and equipment

81

Redemptions of held-to-maturity investments

 

185,917

 

260,918

 

227,663

Purchases of held-to-maturity investments

(176,757)

(267,122)

(221,680)

Redemptions of available-for-sale investments

 

200,892

 

2,250

 

450

Purchases of available-for-sale investments

(106,607)

Net cash provided by (used in) investing activities from continuing operations

 

59,167

 

11,546

 

(6,397)

Financing activities

Principal payments of capital lease obligations

(161)

(288)

Payment of contingent consideration

(868)

Tax withholding payment related to net settlement of equity awards

(1,062)

(1,094)

(397)

Exercise of stock options

 

100

 

71

 

2,705

Net cash (used in) provided by financing activities from continuing operations

 

(1,830)

 

(1,184)

 

2,020

Discontinued operations

Operating activities of discontinued operations

(7,686)

(623)

Investing activities of discontinued operations

(431)

(1,219)

Net cash used in discontinued operations

(8,117)

(1,842)

Net increase in cash, cash equivalents, and restricted cash

 

82,434

 

29,191

 

63,613

Cash, cash equivalents, and restricted cash at beginning of period

 

172,708

 

143,517

 

79,904

Cash, cash equivalents, and restricted cash at end of period

$

255,142

$

172,708

$

143,517

Supplemental disclosures of cash flow information

Cash paid, net during the period for:

Income taxes

$

532

$

6,780

$

1,813

Non-cash activities

Unrealized gain on investments, net of deferred tax expense of $14, $51 and $25 for the fiscal years ended 2020, 2019 and 2018, respectively

$

50

$

57

$

70

Reclassification from share-based liability compensation to equity

$

$

$

384

Change in foreign currency translation adjustments

$

276

$

(34)

$

36

Acquisitions of property and equipment included in accounts payable

$

1,425

$

810

$

379

8


AeroVironment, Inc.

Reconciliation of non-GAAP Earnings per Diluted Share (Unaudited)

Three Months Ended

Three Months Ended

Year Ended

Year Ended

    

April 30, 2020

April 30, 2019

April 30, 2020

April 30, 2019

Earnings per diluted share from continuing operations

$

0.73

$

0.26

$

1.72

$

1.74

Acquisition related expenses

0.04

Amortization of acquired intangible assets

0.02

0.08

One-time gain from a litigation settlement

(0.26)

Earnings per diluted share from continuing operations as adjusted (Non-GAAP)

$

0.75

0.26

$

1.84

$

1.48

Reconciliation of Forecasted Earnings per Diluted Share (Unaudited)

Fiscal year ending

    

April 30, 2021

Forecasted earnings per diluted share from continuing operations

$

1.65 - 1.85

Amortization of acquired intangible assets

0.09

Forecasted earnings per diluted share from continuing operations as adjusted (Non-GAAP)

$

1.74 - 1.94

Statement Regarding Non-GAAP Measures

The non-GAAP measure set forth above should be considered in addition to, and not as a replacement for or superior to, the comparable GAAP measure, and may not be comparable to similarly titled measures reported by other companies. Management believes that this measure provides useful information to investors by offering additional ways of viewing our results that, when reconciled to the corresponding GAAP measure, help our investors to understand the long-term profitability trends of our business and compare our profitability to prior and future periods and to our peers. In addition, management uses this non-GAAP measure to measure our operating and financial performance.

We exclude the acquisition-related expenses and amortization of acquisition-related intangible assets in fiscal 2020 and the one-time gain from a litigation settlement in fiscal 2019 because we believe this facilitates more consistent comparisons of operating results over time between our newly acquired and existing businesses, and with our peer companies. We believe, however, that it is important for investors to understand that such intangible assets contribute to revenue generation and that intangible asset amortization will recur in future periods until such intangible assets have been fully amortized.

9


##

For additional media and information, please follow us at:

Facebook: http://www.facebook.com/aerovironmentinc

Twitter: http://www.twitter.com/aerovironment

LinkedIn: https://www.linkedin.com/company/aerovironment

YouTube: http://www.youtube.com/user/AeroVironmentInc

Instagram: https://www.instagram.com/aerovironmentinc/

Contact:

AeroVironment, Inc.

Steven Gitlin

+1 (805) 520-8350

ir@avinc.com

10


Exhibit 99.2

Fourth Quarter and Full Fiscal Year 2020 Earnings Presentation June 23, 2020


Safe Harbor Statement Certain statements in this presentation may constitute "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” or words or phrases with similar meaning. Forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of our control, that may cause our business, strategy or actual results to differ materially from the forward-looking statements. Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, reliance on sales to the U.S. government; availability of U.S. government funding for defense procurement and R&D programs; changes in the timing and/or amount of government spending; our ability to perform under existing contracts and obtain new contracts; risks related to our international business, including compliance with export control laws; potential need for changes in our long-term strategy in response to future developments; the extensive regulatory requirements governing our contracts with the U.S. Government and international customers; the consequences to our financial position, business and reputation that could result from failing to comply with such regulatory requirements; unexpected technical and marketing difficulties inherent in major research and product development efforts; the impact of potential security and cyber threats; changes in the supply and/or demand and/or prices for our products and services; the activities of competitors and increased competition; failure of the markets in which we operate to grow; uncertainty in the customer adoption rate of commercial use unmanned aircraft systems; failure to remain a market innovator and create new market opportunities; changes in significant operating expenses, including components and raw materials; failure to develop new products; the extensive regulatory requirements governing our contracts with the U.S. government; risk of litigation, including but not limited to pending litigation arising from the sale of our EES business; the impact of our recent acquisition of Pulse Aerospace, LLC and our ability to successfully integrate it into our operations; product liability, infringement and other claims; changes in the regulatory environment; the impact of the outbreak related to the strain of coronavirus known as COVID-19 on our business operations; and general economic and business conditions in the United States and elsewhere in the world. For a further list and description of such risks and uncertainties, see the reports we file with the Securities and Exchange Commission. 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. For a further list and description of such risks and uncertainties, see the reports we file with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are available at www.sec.gov or on our website at www.investor.avinc.com/financial-information. 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.


Fourth Quarter and Full Fiscal Year 2020 Key Messages Delivered record results Fourth quarter revenue: $135 million Fiscal year revenue: $367 million Funded backlog: $208 million Strengthened our leadership position in multiple markets High confidence in our ability to create long-term value by progressing our strategic growth opportunities Achieved Fiscal Year 2020 objectives & delivered Third consecutive year of profitable, double-digit topline growth


Summary of Full Fiscal Year 2020 Results Metric Full Fiscal Year 2020 Year-Over-Year Change Highlights Revenue $367.3 million 17% Record annual revenue from higher small UAS, “other” and HAPS Gross profit $153.1 million 19% Record revenue contributed to higher gross profit EPS (diluted) $1.72 ($0.02) Fiscal year 2019 included $0.26 per share one-time gain from litigation settlement Non-GAAP EPS (diluted) $1.84 $0.36 Fiscal year 2020 included $0.12 in acquisition related expenses and amortization of intangible assets Funded Backlog $208 million 27% Record funded backlog


Higher Revenue and Favorable Product to Service Revenue Mix Contributed to Higher Fourth Quarter Earnings Year-Over-Year * Excludes Q4 Fiscal Year 2020 amortization of intangible assets of $0.02 0.26 0.75 * $- $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 Q4 FY19 Q4 FY20 Non - GAAP Diluted EPS 68% 76% 69% 59% 72% 32% 24% 31% 41% 28% 0% 25% 50% 75% 100% Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Percentage of Quarterly Revenue Product Revenue Service Revenue


Delivered Significant Progress Across Portfolio in Fiscal Year 2020 $226 million in small UAS revenue, driven by strong domestic demand Achieved total of 50 international allied customers First customer procurement of Puma LE Grew contract value of HAPS program to $166 million Prepared for next phase of HAWK30 flight testing in New Mexico Founding member of HAPS Alliance $76 million 1st year award of 3-year U.S. Army LMAMS program worth up to $146 million Largest LMAMS procurement, largest Switchblade order and largest AeroVironment award to-date


Strong Funded Backlog and High Visibility Support Expected Fiscal Year 2021 Year-Over-Year Revenue Growth Record funded backlog supports high visibility Revenue Guidance Range as of 6/23/20: $390 million to $410 million 60% visibility $200.3 $9.1 $31.1 $- $100 $200 $300 $400 Q4 FY20 (6/23/20) Q1 FY21 Q2 FY21 Q3 FY21 Revenue (millions) Revenue Anticipated This FY from Unfunded Backlog Revenue Anticipated This FY from Qtr-To- Date Bookings Revenue Anticipated This FY from Funded Backlog Revenue Year-To-Date


Fiscal Year 2020 Results and Fiscal Year 2021 Expectations Fiscal Year 2020 Actuals Current Fiscal Year 2021 Expectations (6/23/20) Revenue $367 million $390 million to $410 million Operating Income Margin 12% – 12.5% Earnings Per Share (diluted) $1.72 $1.65 to $1.85 Non-GAAP Earnings Per Share (diluted) $1.841 $1.74 to $1.942 First half revenue as percentage of full year revenue 46% Approximately 40% Internal Research & Development Investment 13% of revenue 11-12% of revenue Tax Rate 11.1% 12% Capital Expenditures 3% 5% to 6% achieved Fiscal Year 2020 objectives & delivered Third consecutive year of profitable, double-digit topline growth 1 Excludes acquisition-related expenses and amortization of intangible assets of $0.12 2 Excludes amortization of intangible assets of $0.09


For more information: Steven Gitlin Vice President Investor Relations ir@avinc.com +1 (805) 520-8350


Appendix – Reconciliation of Non-GAAP Diluted Earnings Per Share (Unaudited) Three Months Ended Three Months Ended Year Ended Year Ended April 30, 2020 April 30, 2019 April 30, 2020 April 30, 2020 Earnings per diluted share from continuing operations $ 0.73 $ 0.26 $ 1.72 $ 1.74 Acquisition related expenses - - 0.04 - Amortization of acquired intangible assets 0.02 - 0.08 - One-time gain from a litigation settlement - - - (0.26) Earnings per diluted share from continuing operations as adjusted (Non-GAAP) $ 0.75 0.26 $ 1.84 $ 1.48


Appendix – Reconciliation of Fiscal Year 2021 Non-GAAP Diluted Earnings Per Share Expectations (Unaudited) Fiscal year ending April 30, 2021 Forecasted earnings per diluted share $ 1.65 - 1.85 Acquisition related expenses - Amortization of acquired intangible assets 0.09 Forecasted earnings per diluted share as adjusted (Non-GAAP) $ 1.74 - 1.94


v3.20.1
Document and Entity Information
Mar. 03, 2020
Document and Entity Information [Abstract]  
Document Type 8-K
Document Period End Date Jun. 23, 2020
Entity File Number 001-33261
Entity Registrant Name AEROVIRONMENT, INC.
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 95-2705790
Entity Address, Address Line One 900 Innovators Way
Entity Address, City or Town Simi Valley
Entity Address, State or Province CA
Entity Address, Postal Zip Code 93065
City Area Code 805
Local Phone Number 520-8350
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.0001 per share
Trading Symbol AVAV
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0001368622
Amendment Flag false