Butler National OTCMKTS: BUKS reported record fiscal 2026 results, driven by strong growth in its aerospace products segment, while management said a CEO search and continued investment in engineering and mission systems capabilities are among the company’s top priorities.
During the company’s earnings call, Interim CEO and CFO Adam Sefchick said Butler National posted a 17% increase in revenue for fiscal 2026, while operating income and net income rose 69% and 75%, respectively. He said the results reflected increased production efficiencies, expanded fabrication capabilities, larger aircraft modifications, systems integration projects and higher sales volumes.
“This past fiscal year again reflects record performance for Butler National,” Sefchick said. He added that while the fourth quarter included normal year-end accounting adjustments and incentive compensation accruals, the business “continued to perform exceptionally well.”
Aerospace Segment Drives Growth
For the year, Butler National reported total revenue of $98 million, compared with $84 million in fiscal 2025. Aerospace products revenue rose 33% to $60.6 million from $45.7 million in the prior year. The segment includes aircraft modifications, avionics and special mission electronics.
Sefchick said the aerospace products increase was primarily attributable to a $7.6 million increase in aircraft modifications and a $6.5 million increase in special mission electronics. He said the company’s special mission electronics team in Tempe, Arizona, which manufactures gun control units and cabling, recorded 51% revenue growth from the prior year.
He said that business continues to see demand for legacy electronic control systems as well as deliveries of M134 Minigun gun control units.
Butler National’s operating income for fiscal 2026 was $28.5 million, up from $16.8 million in fiscal 2025. Net income increased to $21.9 million from $12.5 million, and earnings per share rose to $0.34 from $0.19. Sefchick said aerospace margins improved, with operating income as a percentage of revenue reaching 33% in fiscal 2026, compared with 17% in fiscal 2025.
The company also reported a record backlog of $47.1 million. Sefchick said backlog conversion can be affected by engineering resources, production scheduling, customer timing and FAA certification activity.
Gaming Revenue Slips, Sports Wagering Grows
Butler National’s professional services gaming segment revenue declined slightly to $37.4 million from $38.3 million in fiscal 2025, a 2% decrease. Sefchick attributed the decline to local economic factors affecting legacy gaming results, including challenges tied to cattle and agricultural industries that have weighed on discretionary spending.
Traditional casino gaming revenue decreased 5% to $26.7 million in fiscal 2026. However, mobile sports wagering revenue increased to $6.5 million from $5.8 million in fiscal 2025, which Sefchick said reflected continued growth in that market.
Costs for gaming were down 2%, while expenses increased 2%, according to Sefchick.
CEO Search Underway
Executive Chairman Jeffrey Yowell said the board has begun a formal search process for the company’s next chief executive officer following the leadership transition. He said the board has engaged a recruiter and is evaluating a number of candidates.
“Our objective is to identify the right long-term leader, not simply move quickly,” Yowell said. He added that shareholders should view the process as “a leadership transition, not a change in strategy.”
Yowell said the company is grateful for Chris Reedy’s leadership and for his continued assistance during the transition “as his health permits.” In the interim, Sefchick and the executive leadership team are providing continuity, Yowell said.
NASDAQ Uplisting Remains Long-Term Goal
Several pre-submitted shareholder questions addressed a possible NASDAQ uplisting. Yowell said an uplisting remains an important long-term objective, but the CEO search is the board’s highest immediate priority.
He said the board is evaluating more than minimum listing requirements, including trading liquidity, shareholder composition, governance readiness, market conditions and whether an uplisting would maximize long-term shareholder value.
“Do we expect that to occur in the very near future? No,” Yowell said. “However, we remain committed to pursuing an uplisting when we believe it will create the greatest long-term value for shareholders.”
Fiscal 2027 Priorities
Sefchick said management’s priorities for fiscal 2027 include executing a smooth CEO transition, growing aerospace products and mission systems integration, converting backlog into revenue, investing in engineering and manufacturing capabilities, and maintaining disciplined capital allocation.
He said Butler National has added engineering and technical professionals in recent months to support future opportunities. The investments are intended to support Avcon’s expansion into higher-value mission systems integration work and continued product development at the Tempe business.
Yowell identified three long-term aerospace growth opportunities: kit sales, mission systems integration and traditional aircraft modifications. He said customers increasingly want “complete mission-ready aircraft,” and that Avcon’s engineering, certification and integration expertise positions the company to pursue larger opportunities.
Sefchick also said fiscal 2026 was not driven by a one-time event. He pointed to demand for aircraft modifications, special mission aircraft engineering services and mission integrations. He noted that Avcon completed and certified its Special Missions Challenger 605/650 platform and recently completed a modification on the CN-235, the largest aircraft in Avcon’s history.
Butler National also repurchased 3,326,000 shares of common stock during fiscal 2026. Sefchick said stockholders’ equity increased 26% during the year, while long-term liabilities declined 16%.
Yowell said Butler National enters fiscal 2027 “from a position of strength,” citing record financial performance, a strong balance sheet, growing aerospace capabilities, an expanding backlog and a clear strategy.
About Butler National OTCMKTS: BUKS
Butler National Corporation, together with its subsidiaries, designs, engineers, manufactures, sells, integrates, installs, repairs, modifies, overhauls, services, and distributes a portfolio of aerostructures, aircraft components, avionics, accessories, subassemblies, and systems in North America, Europe, the Middle East, Asia, and internationally. It operates through two segments, Aerospace Products and Professional Services. The Aerospace Products segment provides aircraft modifications to business-size aircraft, which include passenger-to-freighter configuration, radar systems, addition of aerial photography capabilities, search and rescue, environmental research, mapping, intelligence surveillance reconnaissance modifications, and stability enhancing modifications for Learjet, Beechcraft, and Cessna aircraft along with other specialized modifications.
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