Aerospace Q4 Profit Beats Estimates

B/E Aerospace, the world's biggest supplier of plane seats, posted a quarterly profit that beat most estimates, driven by strong operating margins and a doubling of sales at its distribution unit.

The company also forecast 2009 profit above Wall Street estimates, even as it remained "cautiously optimistic" about the next two years amid a drop in air traffic.

Demand for new planes has fallen sharply amid the global recession and this is expected to hurt several suppliers to original equipment manufacturers.

However, B/E Aerospace has not seen any cancellation of orders, it has only seen deferrals, Jesup & Lamont Securities analyst Alex Hamilton said.

Hamilton expects the company's acquisition of Honeywell International's Consumables Solutions aerospace fasteners distribution unit to boost 2009 earnings considerably.

"The outlook means that the margins are going to be relatively stronger," the analyst added.

B/E Aerospace fits out commercial and business jets with oxygen masks, food trolleys and other equipment, and its customers include world's leading plane makers -- Airbus and Boeing.

For 2009, the company forecast earnings of USD$2.00 a share, excluding HCS integration costs of about 10 cents a share, on revenue of about USD$2.25 billion.

The company forecast a first-quarter profit below market estimates, citing weaker product mix at the commercial aircraft unit, decreased shipments on new aircraft deliveries as a result of the Boeing strike, and lower spares revenue due to airline cash conservation measures.

For the fourth-quarter, B/E Aerospace reported net profit of USD$46.4 million.

Excluding charges, it earned USD$51.9 million, compared with USD$42.3 million in the year-ago period.

Revenue rose 14 percent to USD$526.8 million, driven mainly by the growth in its distribution segment.

Distribution segment revenue more than doubled to USD$232.5 million, reflecting the acquisition of the Honeywell unit.