AAR Provides Preliminary Fourth Quarter Results and Outlook on Fiscal 2013

WOOD DALE, IL – AAR CORP. (NYSE: AIR) announced today preliminary unaudited fourth quarter results for the period ending May 31, 2012, as well as its outlook for fiscal year 2013.

Consolidated sales for the fourth quarter ended May 31, 2012 are expected to be between $560 million to $565 million, which would represent the highest quarterly sales in the Company’s history. Diluted earnings per share are expected to be between $0.44 and $0.46 before the effects of special items. Cash flow from operations is expected to be in excess of $50 million for the quarter.

For the fourth quarter, sales to commercial customers are anticipated to increase by approximately 40%, which includes 13% organic growth at the company’s supply chain and MRO services businesses. The balance of the commercial sales growth is expected to come from the newly acquired businesses; Telair and Nordisk.

In the government and defense market, sales are expected to decline year-over-year but remain essentially flat with the third quarter. In order to streamline operations and improve efficiencies at the Company’s manufacturing businesses supporting this market, the Company expects to record approximately $4.0 million in restructuring charges. The Company also expects to record an approximately $9.5 million charge as a result of lowering its profit expectations on the KC10 support contract. This adjustment represents the difference between the new margin expectation and the previous margin expectation for the period of performance since contract inception.

Further, the Company expects to record an approximately $3.0 million favorable adjustment to fourth quarter income tax expense.

Diluted earnings per share are expected to be between $0.30 and $0.32 after these special items.

Outlook for Fiscal 2013

Based upon the Company’s current outlook for fiscal 2013, it expects commercial aviation results to remain strong and to increase on a year-over-year basis as the full year impact from Telair and Nordisk are included in results. The Company also expects improved results at AAR Airlift as it benefits from actions taken to improve aircraft availability. Results at the Company’s mobility products and defense systems logistics businesses are expected to be down year-over-year. For fiscal 2013, the Company expects consolidated sales to be between $2.1 and $2.2 billion and diluted earnings per share of $1.55 to $1.65.

The Company also announced today that it received authorization from its Board of Directors to repurchase up to $50 million in common stock.

The Company plans on announcing final audited results after the market closes on July 17, 2012 and will host an investor call the following morning.