VSE Revenue Jumps 91.2% To $541.0 Million As Engine Repair Deals Land, And Guidance Rises
The aviation aftermarket company raised its 2026 revenue and margin outlook after a record quarter, with debt up to $978.8 million.
VSE, which sells aircraft parts and repairs engine components for airlines and aircraft owners, reported record third-quarter revenue of $541.0 million, up 91.2% from a year earlier, and raised its 2026 forecast. Net income from continuing operations reached $47.3 million, against $3.6 million a year ago, the company said Wednesday.
Acquisitions did most of the lifting
Organic growth was approximately 17%, led by the commercial aviation engine aftermarket. Acquisitions supplied the remaining approximately 74 percentage points, driven by a full quarter of Precision Aviation Group plus other deals.
Repair revenue rose 197.6% and distribution revenue 26.7% from the prior-year quarter. Adjusted EBITDA, a profit measure that strips out items such as acquisition costs and stock pay, rose 126.3% to a record $107.2 million, from $47.4 million. The margin was 19.8%, against 16.7% a year earlier; the company credited a richer mix of engine products and repair work, along with acquisition synergies.
Diluted earnings per share from continuing operations were $1.49, up from $0.17. On an adjusted basis they were $2.01, up 48.9%.
Higher guidance, higher debt
VSE now expects full-year 2026 revenue growth of 65% to 66.5%, up from 61% to 64%. It sees an adjusted EBITDA margin of 18.9% to 19.1%, up from 18.7% to 19.0%.
The expansion has been financed with borrowing. Principal debt stood at $978.8 million at September 30, against $296.3 million at the end of 2025, and net debt was $894.2 million. The adjusted net leverage ratio, which counts earnings of acquired businesses from before they were bought, was about 2.3 times, versus 1.1 times at year-end.
The company generated $56.0 million of operating cash flow and $46.6 million of free cash flow in the quarter, with $65.8 million in cash and $479.2 million of unused revolving credit. CFO Adam Cohn said he expects strong fourth-quarter free cash flow to support continued deleveraging.
Deeper into engine repair
VSE sells aftermarket parts and does maintenance, repair and overhaul work for airlines, cargo carriers, manufacturers and aircraft owners. It bought Atech Turbine Components on August 31, adding repair approvals covering more than 300 part numbers, mainly for Pratt & Whitney Canada engines, including sole-source repairs for flight-critical components.
CEO John Cuomo said teams are "bringing more repair work in-house" across the combined VSE and Precision Aviation Group platform. A conference call is set for Thursday at 8:30 a.m. ET.
The quarterly 10-Q report is due on or about Thursday, according to the company.
Sources
- 8-K Filing — VSE CORP (VSEC) — SEC EDGAR
- Exhibit vse-prxq3x2026earningsrele.htm — VSE CORP 8-K exhibit — SEC EDGAR
- VSE Corporation Announces Third Quarter 2026 Results — businesswire.com
