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                                                             EXHIBIT 99.1
                                                             ------------


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 1



                               AAR CORPORATION

                             Moderator: AAR CEO
                               7 June 27, 2002
                                 10:30 am CT


   Operator:

                  Good day everyone and welcome to the 4th Quarter
                  Earnings Release Conference Call.  Just as a reminder,
                  this conference is being recorded.  At this time, for
                  opening remarks and introductions, I'd like to turn
                  this conference over to AAR Investor Relations. Please
                  go ahead.

   AAR Investor Relations:

                  Thank you, Matt.  Good morning ladies and gentlemen and
                  thank you for taking the time to participate in this
                  morning's conference call.  Before we begin, we would
                  like to remind you that certain of the comments made
                  today relate to future events, which are
                  forward-looking statements as defined in the Private
                  Securities Litigation Reform Act of 1995.

                  Please also refer to the forward-looking statements
                  disclaimer contained in the press release issued this
                  morning, as well as factors which may affect the future
                  results discussed in our filings with the Securities
                  and Exchange Commission.

                  By providing forward-looking statements, the company
                  assumes no obligations to update the forward-looking
                  statements to reflect events or circumstances after the
                  date of such statement or to reflect the occurrence of
                  anticipated or unanticipated events.

                  At this time, I would like to turn the call over to our
                  President and CEO.

   AAR CEO:       Thank you, Dawn, and good morning.  With me today is
                  our Chief Operating Officer and our Chief Financial
                  Officer.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 2


                  By now, you've all had an opportunity to review our
                  results for the 4th Quarter Fiscal 2002 which reflect
                  the challenging airline environment.

                  For the 4th quarter, the company reported a net loss of
                  $2.7 million and diluted loss per share of 8 cents.
                  Net sales for the 4th quarter were $147.4 million, a
                  slight increase from 143.5 in the 3rd quarter of this
                  year.

                  The increase in sales over the 3rd quarter reflects
                  higher demand for engine and airframe parts and
                  component repair services.  These increases were
                  partially offset by lower sales compared to the 3rd
                  quarter in our manufacturing and in Aircraft and Engine
                  Sales and Leasing segments.

                  We are pleased to say that the month of May was the
                  highest-sales month and most profitable since September
                  -- and it was a profitable month.  Compared to a year
                  ago, our 4th quarter sales declined 33%, as most of our
                  airline customers dramatically reduced their buying
                  activity from prior year levels.  This was most evident
                  in our Aircraft and Engine Sales and Leasing segments
                  which experienced an 87% drop in sales year-over-year
                  reflecting the lack of big-ticket activity and new
                  capital investments in the airline industry.

                  Although net earnings were down dramatically
                  year-over-year, the impact of lower sales has been
                  mitigated by lower operating expenses and interest
                  costs, as we have taken quick and aggressive actions to
                  reduce our costs structure and maintain our financial
                  position.

                  Compared to the 3rd quarter of this year, sales in our
                  inventory logistics services segment grew by 4.7%
                  driven by increased demand by commercial customers
                  seeking to replenish stock and higher sales in support
                  of U.S. Military Logistics Support Contracts.  Within
                  this segment, we continue to experience an active deal
                  flow for logistics support for the U.S. Military.

                  Also, since identifying the need to move to new
                  technology support, 84% of our inventory has been
                  acquired within the last 24 months, reflecting our move
                  to support newer generation aircraft.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 3


                  In our Maintenance Repair and Overhaul segments, sales
                  increased over the 3rd quarter by 8.1%, reflecting
                  higher sales of component repair services. We continue
                  to develop new repair capabilities for new generation
                  aircraft as well as regional jets, and are focusing on
                  operational efficiencies such as plant consolidations
                  to drive improved financial performance in this
                  segment.

                  In the last report, you may recall, we talked about
                  consolidating our landing gear facilities.  We
                  successfully consolidated the two facilities in the 4th
                  quarter.  We are in the process today of consolidating
                  our two Long Island-based airframe component facilities
                  and that should be achieved by September of this year.

                  In our manufacturing segment, sales of technical
                  deployment products remain strong although they did
                  decline somewhat from the particularly robust 3rd
                  quarter.  We expect strong sales of these products
                  going forward.

                  Our consolidated gross profit margin during the 4th
                  quarter was 14% up slightly from the 3rd quarter but
                  still well below historical levels.  Our gross profit
                  margins continued to be soft, mainly as a result of
                  lower volumes flowing through many of our facilities.
                  As we consolidate certain facilities and as volume
                  increases, we expect our gross profit margins to
                  improve.

                  The outlook for Military Support which all of our
                  segments remain strong.  Sales to U.S. Government and
                  contractors grew 15% during the fiscal year as we were
                  successful in landing several new logistics support
                  contracts which include parts supply and repair
                  services.

                  Government sales now represent 25% of our consolidated
                  sales.  We expect growth in support of this market as
                  we move forward.

                  Improvement for the airline is expected to be slow but
                  steady, and we continue to operate in a challenging,
                  yet opportunistic environment.  We've reduced our costs
                  structure, made strategic capital investments,


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 4


                  purchased inventory at attractive prices and have
                  support for our key customers in every way possible.

                  We expect our financial performance to improve as the
                  environment for our airline customers gets better.

                  That concludes the formal remarks section of the call.
                  And I'd like to thank you for your time and open up the
                  line for any questions you may have.  Thank you.

   Operator:      Thank you.  Our question-and-answer session will be
                  conducted electronically today.  If you do have a
                  question or a comment for any of our speakers today,
                  we'd like you to press star-1 on your touchtone phone
                  at this time.  Once again, if you do have a question or
                  a comment, please press star-1 on your touchtone phone
                  at this time.

                  We'll take your questions in the order that we receive
                  them and we'll take as many questions as time permits.
                  We'll now take a moment to assemble our roster.

   Participant:   Yes.  Good morning guys.

   AAR CEO:       Good morning.

   Participant:   First off, can you shed a little light on this growth
                  in the military business, you know, historically, it's
                  been a very, very lumpy business.  I guess it was
                  predominantly about the containers and such.  But it
                  looks like you're getting into a lot of things that are
                  more - can be counted on to be more consistent in
                  nature, is that so?  And to what extent has that become
                  a majority portion of what you do there; how's that
                  shaping up?

   AAR CEO:       Yes, if you look at our military business, you really
                  need to think of it in three different categories.  One
                  is manufacturing which, as you say, has historically
                  been characterized by certain lumpiness in container
                  orders.  Today, that business is a little bit more
                  consistent than it's been in the past.  It does have
                  some movement based on certain contracts and timing of
                  those contracts.

                  The second areas are component maintenance business and
                  airframe maintenance business. That business has been


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 5


                  fairly steady.  It is somewhat subject to U.S.
                  Government budgeting.  We have, for instance, $3
                  million of F16 component in our New York facility that
                  is awaiting government funding.  We know the funding
                  will be coming - these are the auxiliary drive
                  gearboxes for the F16 aircraft.  The parts will need to
                  be put back on the aircraft in the fleet so that
                  funding should be forth coming momentarily, but yet, we
                  are waiting for the funding.

                  The third category, Logistics Support, has been growing
                  in excess of 50% a year for the last three years.  That
                  business is fairly predictable, somewhat based on the
                  government looking to transition away from managing
                  these activities on their own to having third parties
                  manage that activity on their behalf.

                  In this regard, we are principally serving as a
                  subcontractor to the major systems providers such as
                  Lockheed Martin, UTC and Northrop Grumman, and people
                  of that nature.  So that business, we believe, is
                  definitely more predictable and we expect that business
                  to continue to grow not just this year but for the next
                  three or four years.  That business - sales is about
                  $35 million in total volume -- is in logistics fees.
                  We expect that business to be twice its size in the
                  next three fiscal years.

   Participant:   Okay.  Could you comment briefly on - one of your items
                  here is your Cargo Landing Systems Agreement that you
                  signed.  Is that - with the surplus aircraft and
                  everything, I could see that as either a good thing or
                  a bad thing?  Is that business on hold temporarily or
                  is there more activity because there's more old
                  aircraft around to convert?

   AAR CEO:       Our cargo system business, signed a contract during the
                  year with FEDEX to supervise the cargo system
                  conversions for the MD11s.  Following September 11th,
                  the major freight carriers put that activity on hold
                  and slowed down the conversion process.  As the time
                  has elapsed since September 11th, we're seeing those
                  aircraft now go back into the conversion process.  We
                  anticipate deliveries on these systems throughout this
                  next fiscal year.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 6


   Participant:   Okay.  So we could anticipate that particular activity
                  being more robust over the next six to nine months as
                  opposed to the last six to nine months.

   AAR CEO:       Yes. That's correct.

   Participant:   Okay.  I guess my only other question would be for Tim
                  - could we shed a little light on the ramp-up in
                  current liabilities?  Is that mainly about short-term
                  debt or is it something else?

   AAR:           No, it's short-term debt.  We ended the quarter with
                  $34 million of cash in the bank and $40 million drawn
                  on our lines.  At the end of the 3rd quarter, we had
                  drawn $20 million on our lines.

   Participant:   Okay.  Thanks a lot.

   Operator:      And our next questioner.

   Participant:   Thanks.  Congratulations on the good earnings report in
                  this difficult environment.  I have two questions.  My
                  first was regarding the regional jet market, could you
                  give us a better understanding of that market and in
                  terms of how much revenues you currently derive from
                  serving it?

   AAR CEO:       Yes.  Currently, the market represents about 6% of our
                  total revenues.  And we believe that as the jets enter
                  the market, which has been a phenomenon that's been
                  going over the last few years but continues to increase
                  in terms of its relationships to the total world fleet,
                  we believe that that business for us will become as
                  much as 15% of our total revenues.

                  The industry is fairly well characterized by operators
                  who do not have huge infrastructures.  They do not have
                  their own maintenance and spare-parts support
                  capabilities.  We believe that as the segment grows, as
                  more of these jets come into service, the operators
                  will be calling upon us for additional support.  We are
                  seeing that today.  You'll see in our highlights for
                  the year, that we signed a couple of meaningful
                  contracts with KLM UK and Lufthansa City Lines, both to
                  support their regional jets.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 7


                  We also have an agreement with an operator in Italy at
                  Pan Airlines to support their (Embraer) air regional
                  jet.  And if I were to look at deal flow, I'd see that
                  more of these opportunities are hitting.

   Participant:   So 6, I'm sorry, 6% going to 15, could we see 15% next
                  year without a longer-term goal?

   AAR CEO:       I think you're looking at about two years.

   Participant:   Okay, two years.  That's great.  My second question is
                  a clarification of an earlier question regarding the
                  liabilities.  And if I look at, I guess, the debt, the
                  short-term debt, the long-term debt, I guess it's 259
                  million.  Does that include trade notes payable?

   AAR CEO:       Yes, it does.

   Participant:   So the trade notes are...

   AAR CEO:       Yes, the trade notes payable...

   Participant:   Are in the 259 million of debt at the end of the year?

   AAR CEO:       Includes all of our notes payable, yes.

   Participant:   So, did you - I'm a little bit confused by the figure
                  then.  Did you retire that 65 million that was due
                  November of '01?

   AAR CEO:       Yes, we did.  And we refinanced it with a $75 million
                  private placement.

   Participant:   Right.  And you also raised $36 million of stocks, so I
                  don't understand why the liabilities...

   Participant:   Why are they there then?

   AAR CEO:       The short-term liabilities went up because we drew down
                  on our revolvers, the $40 million that I explained
                  earlier.

   Participant:   Right.

   AAR CEO:       The long-term debt went up $30 million because we
                  converted some leases for aircrafts and engines to
                  long-term debt.  That's $30 million.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 8


   Participant:   I'm sorry, so you converted - could you say that again,
                  the leases?

   AAR CEO:       We converted some leases of airplanes and engines from
                  operating leases to notes payable -- long-term notes
                  payable.  And that caused the long-term debt to go up
                  by $30 million.

   Participant:   And you drew on the revolver?

   AAR CEO:       We increased our borrowings from the revolver from 20
                  million in the 3rd quarter to 40 million in the 4th
                  quarter.

   Participant:   So you're just better positioned now from a liquidity
                  point of view.  You have more cash, and you have more
                  debt.  But I guess the thing that I didn't know was the
                  conversion of these leases into debt.

   AAR CEO:       Right.

   Participant:   Could more of the leases convert to debt?

   AAR CEO:       I think, right now, we're situated where we want to be.
                  There's about $30 million of additional leases out
                  there, but, for the time being, we plan to have them
                  stay out there as leases.

   Participant:   What drives the decision to convert leases to debt?
                  How does that happen?

   AAR CEO:       It is just based on our interest in getting the amount
                  of off-balance sheet leases that we have out there
                  down. We began the year with $86 million of these
                  leases, and we're ending the year at 30 million.

   Participant:   Okay.  Thank you for the clarification.

   Operator:      And our next questioner.

   Participant:   Good morning, guys.

   AAR CEO:       Hi.

   Participant:   A question.  You did some consolidation of, you know,
                  the branches on your distribution system.  What impact


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                   Page 9


                  did that have on your airline sales and your general
                  aviation sales?

   AAR CEO:       Okay, the impact on the commercial sales has been
                  negligible; the branches were not handling commercial
                  sales.  It had an impact on the GA sales but, you know,
                  the impact there has been pretty much what we
                  anticipated.  The impact has been, on the sales, has
                  been less than the benefit from the cost reduction.  So
                  the business is in better financial shape today than it
                  was before the consolidation of the GA branches.

   Participant:   So is there any impact on your overall distribution
                  business?  It sounds like it was pretty minimal?

   AAR CEO:       Yes.  We're actually positive.

   Participant:   Yes.

   AAR CEO:       And going forward, we believe more positive.

   Participant:   Okay.  You know, you sound like that business is
                  starting to pick up a little bit maybe because I'm
                  hearing, you know, a lot of people are getting
                  inquiries now?

   AAR CEO:       Yes, well definitely, if you take a look at American
                  Airlines, for instance, where we have a three-year
                  contract, our business had been running at about
                  $500,000 a month.  Through April, from September
                  through April, they've  been running about 200,000 a
                  month.  The month of May it got back up to ensure the
                  $500,000 level.  So, that's anecdotal for that
                  business.  We are contemplating and expecting an
                  improvement in the commercial side of that business,
                  the airline side of that business going forward.

   Participant:   Turning to your airframe MRO operations, do you right
                  now have any repair certificates for the ERJ or the CRJ
                  out of Oklahoma or anything?

   AAR CEO:       We're in the process of getting all the tooling that we
                  need for the CRJ.  We're about two pieces of tooling
                  away from having that capability.  The certificate that
                  we already have the certificate allows us to do repairs
                  on the aircrafts.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                  Page 10


                  We just need - we've been sending people to training
                  now for the last six months.  So, our technicians are
                  trained, our managers are trained, we're now looking
                  for a couple of pieces of tooling that are on order.
                  And we expect to have that tooling and to be in a
                  position to service those aircraft within the next
                  three to six months period.

   Participant:   And then, you're going to go after the ERJs as well?

   AAR CEO:       Right now, in North America, we see more of an
                  opportunity today on the CRJs.  We are doing ERJ
                  maintenance, component maintenance in Europe, and doing
                  that quite well, but at this moment, we're more focused
                  on the CRJ. We may move to the ERJ but that will be
                  customer-driven.

   Participant:   And now, are you going to get involved on, you know,
                  doing any of the engine parts for the -- you know, for
                  the engines, either of those two aircrafts and maybe
                  doing any engine leasing or pulling or anything?

   AAR CEO:       You know, that's not really contemplated at this time.
                  GE has a very strong position, particularly around the
                  CRJ, the CF34, so we are not being overly aggressive in
                  that area at this time.

                  Now, we are being aggressive on the part side, on the
                  airplane part side, and we're building a nice little
                  business around supporting those aircraft.

   Participant:   Thank you.

   AAR CEO:       Thank you.

   Operator:      And just as a reminder, if you do have a question or a
                  comment today, please press star, followed by the digit
                  1 on your touchtone phone at this time.  Once again,
                  that is star, followed by the digit 1 on your touchtone
                  phone.

                  We'll now take a question.

   Participant:   Hi! If you went over this, I missed it.  But could you
                  just break out the details on working capital,
                  inventories and receivables?


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                  Page 11


   AAR CEO:       Yes.  Receivables were 77.5 million up from 71 million
                  in February.  The increase is due to a higher sales in
                  May, as well as lower use of our securitization program
                  by $4 million.

                  Inventory went from 235 to 238.  And cash was flat at
                  34 million.  Payables did come down as we paid off some
                  extended terms notes that we had received from some of
                  our suppliers, so that cause the reduction in accounts
                  payable of about $10 million.

   Participant:   Okay.  Could you just characterize kind of the trend of
                  business through the quarter? You talked a little bit
                  about American Airlines specifically but just, you
                  know, overall?

   AAR CEO:       March and April were somewhat disappointing.  The month
                  of May was the best month we've had since September or
                  rather since, I guess, August. It was profitable and,
                  you know, we're somewhat optimistic as a result of
                  May's result.

   Participant:   So, the trend - you're starting to show some signs of
                  life here as we move further into the year.

   AAR CEO:       Yes.

   Participant:   Good.  Thanks very much.  That's it for me.

   Operator:      We'll take our next question.

   Participant:   Yes, just a couple of maintenance questions.  What was
                  cap ex for the year in depreciation and amortization,
                  and what do you expect it to be for this current year?

   AAR CEO:       It was 12.1 million, for the year.

   Participant:   For cap ex?

   AAR CEO:       For cap ex, yes.  And depreciation and amortization was
                  17.8, and we expect approximately the same in the
                  upcoming fiscal year.

   Participant:   Okay.  And then, in terms of trends of business, I
                  think that June was continuing along at the base that
                  May was.


                                                          AAR CORPORATION
                                                       Moderator: AAR CEO
                                                     06-27-02/10:30 am CT
                                                    Confirmation # 602201
                                                                  Page 12


   AAR CEO:       Of course, we're into the first - well, I guess, we're
                  coming down towards closing in June.  June should be on
                  plan to where we expect it to be.

   Participant:   Okay.  Bye.

   AAR CEO:       Thank you.

   Operator:      And, once again, we'll now take a follow-up question.

   Participant:   Yes, given the short rebound we're seeing in May in
                  terms of the business, are you guys comfortable with
                  the current consensus for '03?

   AAR CEO:       Hold on a second.

   Participant:   It's 38 cents.

   AAR CEO:       [The current street consensus of 10 cents - 55 cents]
                  is in the ballpark.

   Participant:   Okay.  So you guys feel good about it?  Thank you.

   AAR CEO:       Okay.

   Operator:      Okay.  And there are no further questions at this time,
                  Mr. Storch.  I'll turn the call over to AAR for any
                  additional or closing comments.

   AAR CEO:       Okay.  Well, I appreciate your attention today and look
                  forward to the next conference call 90 days from now.
                  Thank you for your support.

   Operator:      And that does conclude today's conference call.  We'd
                  like to thank everyone for their participation and wish
                  everyone a good day.

   END

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