Aar Corp Q3 2026 results

These risks and uncertainties are discussed in the company's earnings release in the Risk Factors section of the company's annual report on Form 10-K for the fiscal year ended May 31, 2025. Reconciliations of these non-GAAP measures to the most comparable GAAP measures are set forth in the company's earnings release and slides. Our focused business model is driving growth that is delivering durable results in both commercial and government end markets, as evidenced by our third quarter performance. We saw growth across each of our parts repair and software platform activities in the quarter.

Total sales increase included 14% organic adjusted sales growth, led by 36% organic growth in our new parts distribution activities. In parts supply, ADI is performing above expectations and we continue to drive outsized growth in our new parts distribution activities. Also, our Trax software platform continues to gain momentum by growing its base of recurring revenue with new and existing customers. Finally, we are carefully managing our balance sheet to preserve strategic flexibility as we maintain our disciplined approach to capital allocation.

We ended the third quarter with net leverage within our target range, supported by our strong operating cash flow in the period. As many of our customers have said publicly, fundamental demand for air travel remains strong, with bookings at record levels even since the start of the conflict. It was programs like these that helped drive 19% increase in government sales this quarter and contributed to the strength of our results. We achieved 36% organic growth in new parts distribution, driven by our two-way exclusive distribution model.