B/E Aerospace (BEAV) Sees Q3 Charge on Cost Reduction Program

B/E Aerospace (NASDAQ: BEAV) announced that it expects to recognize charges during the third quarter associated with its cost reduction program. The charges reflect costs associated with facilities consolidation, product rationalization, workforce reductions and program discontinuance. The Company plans to close several facilities, consolidate certain product lines and reduce headcount by approximately 450 employees. Total after-tax charges for the associated activities are expected to be approximately $30 million.

"These initiatives are expected to reduce costs and improve efficiencies which are necessary due to the slower revenue growth expected in 2015 and 2016. We expect our initiatives to offset inflationary pressures on wages, occupancy and infrastructure costs and enable us to continue to generate incremental year-over-year margin improvement,” said Amin J. Khoury, Executive Chairman of B/E Aerospace.

Commenting on the Company’s outlook, Mr. Khoury stated, “We are confirming herein that we continue to expect 2015 revenues and net earnings per diluted share to be approximately $2.8 billion and approximately $3.03 per share respectively, exclusive of the charges associated with the aforementioned initiatives. In addition, as we previously reported, we expect to provide detailed 2016 financial guidance on October 27, 2015. We continue to expect 2016 revenues to be one to two percent higher as compared with 2015 followed by a strong acceleration in the 2017 revenue growth rate consistent with the scheduled deliveries from the Company’s record backlog.”

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