A CPI Aerostructures worker makes aircraft parts on Oct. 11,...

A CPI Aerostructures worker makes aircraft parts on Oct. 11, 2012, in Edgewood. Credit: Bloomberg News

Aerospace manufacturer CPI Aerostructures Inc. Tuesday posted an increase in third-quarter revenue versus the 2013 period but a decline in net income as the cost of sales, such as material and labor expenses, increased.

Revenue increased 4 percent to $21.5 million versus the year-ago period. But the Edgewood company reported net income of $1.7 million, or 20 cents per diluted share, compared to $1.9 million, or 23 cents per diluted share, a year ago.

That was due, in part, to an increase in the cost of sales from $16.2 million in the 2013 quarter to $17 million in the quarter ended Sept. 30.

In a conference call, CEO Douglas McCrosson attributed the company's revenue growth in the quarter to strength in the business jet market, including work on the Cessna Citation X+ with Textron Aviation and the Phenom 300 with Embraer SA.

The company, which makes structural assemblies for aircraft, also is in talks to do work on the Boeing 787, but McCrosson warned that the outcome of such negotiations "is never certain."

Shares of CPI Aero fell 15 cents, or 1.48 percent, to close at $9.97 in trading Tuesday.

On Monday, CPI Aerostructures announced a multiyear contract with Northrop Grumman Corp. worth about $86.1 million to make kits used in manufacturing wings for the E-2D Advanced Hawkeye early-warning and battle-management plane. The kits also would be used on the C-2A Greyhound aircraft, which is used to transport cargo and passengers.

The E-2D contract provides a lift after CPI Aero's $44.7 million noncash charge in August related to the Defense Department's plan to retire the A-10 "Warthog" attack jet. The A-10 program is expected to end in 2015, the company said.

McCrosson said the company is seeking greater efficiency by investing in automation. The company's first automatic drilling and riveting machine is expected to be delivered this month, and executives are evaluating robotic painting and polishing systems, he said.

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