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Drone maker AeroVironment posts $1.4-million loss

AeroVironment's first-quarter red ink contrasts with a $326,000 profit a year earlier and was brought on by a decrease in sales of its robotic aircraft.

September 06, 2012|By W.J. Hennigan, Los Angeles Times
  • AeroVironment Chief Executive Timothy E. Conver said the decrease in drone sales was expected. Above, Conver shows off a Nano Hummingbird drone last year.
AeroVironment Chief Executive Timothy E. Conver said the decrease in drone… (Al Seib, Los Angeles Times )

AeroVironment Inc., the Monrovia company that makes small spy drones and electric vehicle charging systems, posted a first-quarter loss of $1.4 million, or 6 cents a share, brought on by decreased sales of its robotic aircraft.

Analysts on average had forecast a loss of 3 cents a share.

In the same period last year the company had a profit of $326,000, or 2 cents a share.

AeroVironment is the Pentagon's top supplier of small drones — including the Raven, Wasp and Puma models — that give troops on the ground a bird's-eye view of what's happening over a ridge or around a bend.

The company, which makes drones in its Simi Valley facilities, said revenue decreased 5% to $58.7 million compared with $62 million for the same quarter last year.

Drone sales for the quarter fell 6.5% to $48.8 million from $52.2 million in the same quarter last year.

In a conference call, AeroVironment Chief Executive Timothy E. Conver said the decrease in drone sales was expected. The company depends largely on funding from the Pentagon, which is winding down its presence in the Middle East.

"I think the general conventional wisdom going forward is that, even in a highly constrained budget environment, unmanned airplane systems will remain a defense budget priority," Conver said.

AeroVironment hopes to diversify its customer base in the coming years with the Federal Aviation Administration's impending introduction of small drones into U.S. airspace in 2015.

Currently, drones are not allowed to fly in the U.S. except with special permission from the FAA. But as interest in drones has increased among police departments and businesses, the agency has appeared willing to ease restrictions.

"We believe that these rule changes when they take place could initiate a large adjacent opportunity for domestic use of small" drones, Conver said. "Thousands of local police operations in the U.S. cannot currently afford helicopters and airplanes, but many of them could afford small" drones.

Sales of the company's charging systems for electric vehicles increased 1% to $9.9 million from $9.8 million a year earlier.

The financial results were reported after the close of regular trading Wednesday. AeroVironment shares closed up 20 cents, or 0.8%, at $24.22.

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