SOURCE: First Aviation Services Inc.

First Aviation Services Inc.

November 07, 2011 07:00 ET

Third Quarter EPS of $.46 Reported by First Aviation

WESTPORT, CT--(Marketwire - Nov 7, 2011) - First Aviation Services Inc. (PINKSHEETS: FAVSD) today released reviewed financial statements for the third quarter ended September 30, 2011.

Income from operations for the quarter increased by 300% over the prior year period to $916 thousand on 11.2% lower sales. Net income for the quarter was $509 thousand with earnings per share of $.46 versus a net loss of $369 thousand or earnings per share of ($.54) in the prior year quarter. Year to date net income of $1.2 million with earnings per share of $1.23 compared positively to $704 thousand or $.67 per share in the prior year nine months. Gross margin year to date was 21.2% which compares favorably to the prior year of 18.4%. Earnings per share stated above reflect the 1 for 20 reverse stock split that was effective October 24, 2011.

For the first nine months the Company reduced bank borrowings by $4.9 million and increased stockholders' equity by $4.1 million. Book value per share as of September 30, 2011 is $21.28.

Aaron Hollander, Chairman and CEO, said: "The Company continues to benefit from our initiatives to focus on higher margin maintenance, repair and overhaul (MRO) and supply chain management programs. The market continues to be challenging, especially domestically, though we are seeing increased confidence in the longer term outlook, particularly in the international corporate market and flight schools."

First Aviation Services Inc., ("FAvS") located in Westport, Connecticut, through its principal operating subsidiaries Aerospace Products International, Inc., ("API") based in Memphis, TN, Aerospace Turbine Rotables, Inc. ("AeTR") in Wichita, KS, and Piedmont Propulsion Systems, LLC ("PPS") in Winston-Salem, NC is a leading provider of services to the aviation industry worldwide. With locations in the U.S., Canada, Asia Pacific and China plus partners throughout the world, FAvS is a leading provider of aviation products, supply chain management services, repair and overhaul and technology solutions to the industry.

First Aviation Services Inc.
Consolidated Condensed Statements of Operations
(in thousands, except share and per share amounts)
12 Mos Ended
Three Mos Ended Sept 30, Nine Mos Ended Sept 30, Dec 31,
2011 2010 2011 2010 2010*
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net sales $ 29,807 $ 33,584 $ 87,556 $ 96,769 $ 128,463
Cost of sales (23,502 ) (27,395 ) (68,807 ) (76,965 ) (103,392 )
Gross profit 6,305 6,189 18,749 19,804 25,071
Selling, general and administrative expenses 5,048 5,607 15,736 16,173 22,419
Corporate expenses 341 356 1,123 1,129 1,577
5,389 5,963 16,859 17,302 23,996
Income from operations 916 226 1,890 2,502 1,075
Non-operating income (expense)
Interest income and other, net (28 ) (9 ) (46 ) (14 ) 2
Interest expense (330 ) (534 ) (1,058 ) (1,591 ) (2,252 )
Other income 7 - 707 - -
Income (loss) before income taxes 565 (317 ) 1,493 897 (1,175 )
Income tax provision (56 ) (52 ) (265 ) (193 ) (16 )
Net income (loss) 509 (369 ) 1,228 704 (1,191 )
Dividends on preferred stock (64 ) (55 ) (184 ) (176 ) (219 )
Income available (loss attributable) to common stockholders $ 445 $ (424 ) $ 1,044 $ 528 $ (1,410 )
Basic net income (loss) per share, and net income (loss) per share - assuming dilution:
Basic net income (loss) per share (1) $ 0.46 $ (0.54 ) $ 1.23 $ 0.67 $ (1.80 )
Net income (loss) per share - assuming dilution (1) $ 0.46 $ (0.54 ) $ 1.23 $ 0.67 $ (1.80 )
Weighted average shares outstanding - basic (1) 958,124 784,660 846,144 782,879 783,710
Weighted average shares outstanding - assuming dilution (1) 958,370 784,660 846,871 783,934 783,710
* Derived from Audited Consolidated Financial Statements
(1) Earnings per share and weighted average shares outstanding for all periods presented reflect the impact of the 1 for 20 reverse stock split which was effective October 24, 2011
Please see our forward looking statements at www.firstaviation.com/forward
First Aviation Services Inc.
Consolidated Condensed Balance Sheets
(in thousands, except share amounts)
Restated
Sept 30, 2011 Dec 31, 2010* Sept 30, 2010
(Unaudited) (Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 1,181 $ 1,302 $ 1,126
Trade receivables, net 20,820 20,051 20,386
Inventories, net 31,999 34,778 36,494
Prepaid expenses and other 2,139 2,417 3,184
Total current assets 56,139 58,548 61,190
Plant and equipment, net 1,948 2,467 2,626
Deferred financing costs and other 443 538 256
Goodwill 7,773 7,773 7,773
Total assets $ 66,303 $ 69,326 $ 71,845
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 17,478 $ 18,777 $ 17,867
Accrued compensation and related expenses 487 555 479
Other accrued liabilities 2,422 3,387 4,302
Revolving line of credit 18,130 22,257 22,479
Term loan payable 600 6,400 6,600
Notes payable - 28 41
Total current liabilities 39,117 51,404 51,768
Long-term liabilities:
Other liabilities 1,589 1,717 2,127
Term loan payable 5,200 - -
Total liabilities 45,906 53,121 53,895
Stockholders' equity
Class A Common stock, $0.20 par value, 1,000,000 shares authorized, 733,644, 566,031 and 566,031 shares issued, respectively, 670,064, 497,843 and 496,341 shares outstanding, respectively 125 91 91
Class B Common stock, $0.20 par value, 300,000 shares authorized 288,334, 288,334 and 288,334 shares issued and outstanding, respectively 58 58 58
Preferred stock, $0.01 par value, $100 redemption value, 30,000 shares authorized, 17,685, 15,841 and 15,264 shares issued and outstanding, respectively 1,768 1,584 1,526
Additional paid-in capital 42,167 39,669 39,808
Deficit (17,677 ) (18,721 ) (16,749 )
Accumulated other comprehensive income 391 500 368
26,832 23,181 25,102
Less: treasury stock, at cost, 63,580, 68,188 and 69,690 shares, respectively (6,435 ) (6,976 ) (7,152 )
Total stockholders' equity 20,397 16,205 17,950
Total liabilities and stockholders' equity $ 66,303 $ 69,326 $ 71,845
* Derived from Audited Consolidated Financial Statements
Please see our forward looking statements at www.firstaviation.com/forward
First Aviation Services Inc.
Consolidated Statements of Cash Flows
(in thousands)
Three Months Ended
Sept 30,
Nine Months Ended
Sept 30,
12 Mos Ended
Dec 31,
2011 2010 2011 2010 2010*
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Cash flows from operating activities
Net income (loss) $ 509 $ (369 ) $ 1,228 $ 704 $ (1,191 )
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities
Depreciation and amortization 513 503 1,364 1,401 1,146
Equity based compensation 28 5 73 101 132
Provision for bad debts 52 78 188 195 328
Provision for excess and obsolete inventory (36 ) - (36 ) - 270
Change in working capital assets/liabilities:
Trade receivables (567 ) (567 ) (957 ) (3,032 ) (1,930 )
Inventories 1,061 1,488 2,815 623 2,109
Prepaid expenses and other 322 (256 ) (147 ) (350 ) (7 )
Accounts payable (3,298 ) 1,828 (1,347 ) 1,618 2,787
Accrued compensation and related expenses, and other accrued liabilities (857 ) (845 ) (984 ) (1,323 ) (2,162 )
Net cash provided by (used in) operating activities (2,273 ) 1,865 2,197 (63 ) 1,482
Cash flows from investing activities
Purchases of plant and equipment and other assets (71 ) (467 ) (222 ) (664 ) (791 )
Net cash used in investing activities (71 ) (467 ) (222 ) (664 ) (791 )
Cash flows from financing activities
Borrowings (repayments) on revolving line of credit, net (1,320 ) (378 ) (4,128 ) 1,153 931
Loan costs (10 ) - (103 ) (170 ) (347 )
Repayments on term loan - (300 ) (600 ) (400 ) (600 )
Borrowings (repayments) on notes payable and other (174 ) (92 ) (156 ) 246 (397 )
Issuance of Class A Common Stock - - 3,000 - -
Net cash (used in) provided by financing activities (1,504 ) (770 ) (1,987 ) 829 (413 )
Effect of exchange rate changes on cash and cash equivalents (15 ) - (109 ) (9 ) (9 )
Net change in cash and cash equivalents (3,863 ) 628 (121 ) 93 269
Cash and cash equivalents at the beginning of the period 5,044 498 1,302 1,033 1,033
Cash and cash equivalents at the end of the period $ 1,181 $ 1,126 $ 1,181 $ 1,126 $ 1,302
Supplemental cash flow disclosures
Cash paid for:
Interest $ 249 $ 331 $ 831 $ 1,310 $ 1,828
Income taxes paid, net $ 11 $ 42 $ 71 $ 42 $ 28
* Derived from Audited Consolidated Financial Statements
Please see our forward looking statements at www.firstaviation.com/forward

More information about FAvS and its subsidiaries may be found on the company's website, www.firstaviation.com. Please see our forward looking statements at www.firstaviation.com/forward.

Contact Information

  • Contact:
    James G. Howell II
    Chief Financial Officer
    First Aviation Services Inc.
    (901) 259-4502