Textron Aviation's third business quarter 2022 revenue was $1.2 billion; a slight decrease of $14 million from the third quarter of 2021. Textron attributed the revenue decrease to "largely due to lower Citation jet and pre-owned volume, partially offset by favorable pricing and higher aftermarket volume."
Lower Citation jet deliveries caused a revenue decrease (Image: Textron Aviation)
Despite the revenue decrease, Textron Aviation still had a profit of $139 million for the quarter, up $41 million from the same quarter in 2021. According to Textron this was achieved mostly due to favorable pricing, net of inflation of $31 million.
“In the quarter, we saw higher segment profit margin and strong cash generation,” said Textron Chairman and CEO Scott C. Donnelly. "The operating results demonstrate the resiliency of our business segments while navigating ongoing supply chain and labor challenges."
(Image by Textron Aviation)
In an earnings call discussing the quarter, Donnelly further detailed the parts issues.
“As you know we’ve been sort of ramping up our production volumes through the course of the year,” Donnelly explained. “We continue to do that but…for sure we’re continuing to see some difficulties around just getting parts. Labor ramp is picking up and doing reasonably well, but we’ve had some critical parts impacts.”
Donnelly further noted that engines were currently one of the biggest hold ups in the supply chain.
Hit with those supply chain and labor issues, the company delivered fewer planes: 39 jets in the quarter, down from 49 last year, and 33 commercial turboprops, down from 35 in last year's third quarter. Textron did not give a further breakdown of specifically how many of the turboprops delivered were King Air.
In spite of delivery issues, demand for the King Air continues to be strong with a recent order for five King Air 360 by the Queensland, Australia Police. Additionally, the Peruvian Air Force has been working with Textron Aviation on a contract for a single King Air 360. The value of the contract is estimated to have a value of $13.4 million.
King Air 360 (Image by Textron Aviation)
Finally, another strong indicator of continued demand is the backlog for Textron Aviation. For the third quarter it was an impressive $6.4 billion.