U.S. SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report February 24, 2005
ART'S-WAY MANUFACTURING CO., INC.
(Exact Name of Registrant As Specified In Its Charter)
Delaware 0-05131 42-0920725
(State Or Other Jurisdiction of (Commission (IRS Employer
Incorporation or Organization) File No.) Identification
Number)
P.O. Box 288
Armstrong, IA 50514
(Address of Principal Executive Offices) (Zip Code)
(712) 864-3131
(Telephone Number)
Not Applicable
(Former name or former address, if changed since last report.)
ITEM 8.01 FINANCIAL INFORMATION ON COMPANY'S YEAR AND QUARTER ENDED
NOVEMBER 30, 2004
ARMSTRONG, IOWA - Art's-Way Manufacturing Co., Inc., today (February 24,
2005) released the following results for the fiscal fourth quarter and
twelve months ended November 30, 2004.
Highlights:
*Fiscal Year 2004 sales exceeded 2003 by 9%
*Fiscal Year 2004 net income before taxes shows a growth of 7%
*As of February 2005 order backlogs increased to $4,730,000 compared to
$2,212,000 a year ago
(all figures in thousands of dollars except per share amounts)
Quarter Ended
November 30, 2004 November 30, 2003
Net Sales $ 3,576 $ 2,844
Gross Profit 1,061 899
Income from Operations 483 219
Interest and Other Expense 87 57
Income before Income Taxes 397 163
Income tax benefit 179 803
Net Income 575 965
Basic Income Per Share (a) $ 0.30 $ 0.49
Diluted Income Per Share (b) $ 0.30 $ 0.49
Twelve Months Ended
November 30, 2004 November 30, 2003
Net Sales $ 12,784 $ 8,876
Gross Profit 3,597 2,296
Income from Operations 1,092 822
Interest and Other Expense 169 121
Income before Income Taxes 924 700
Income tax benefit 478 2
Net Income 1,402 698
Basic Income Per Share (a) $ 0.72 $ 0.86
Diluted Income Per Share (b) $ 0.72 $ 0.85
(a) Basic income per share based on the weighted average number of
shares outstanding 1,938,176 for all periods presented.
(b) Diluted income per share based on the weighted average number of
shares outstanding 1,958,243 for the quarter and 1,958,457 for the twelve
months in 2004 and 1,957,784 for the quarter and 1,954,408 for the
twelve months in 2003.
Fiscal year 2004, fourth quarter, net sales increased by 26%. The
increase was due to strong Art's-Way branded product shipments led by
sugar beet harvesting equipment. Beet equipment sales in the fourth
quarter totaled $1,343,000, compared to $536,000 in the fourth quarter
of 2003. Sales, for fiscal year 2004, increased 8.9%, compared to 2003.
Sales of Art's-Way's branded products increased by $1,828,000 while OEM
sales decreased by $990,000. Sugar beet, land planes, vegetation cutting
equipment, grinder mixers, plows and Ag Scales were up 26%, 79%, 103%,
34%, 100% and 111%, respectively. Mills, land maintenance, and supramix
equipment demand remained steady. Replacement parts sales remained
strong.
Gross profit, as a percent of sales was 28% for 2004 compared to
27% for 2003. The agricultural markets we serve are generally forecasted
to remain constant in 2005, yet we anticipate that our sales and profits
for 2005 will increase as we bring new products to market. In late 2004
we produced our new grinder mixer, with reduced cycle times, and
increased capacity. Sales have exceeded our expectations, and we
anticipate favorable sales for the first quarter 2005 compared to 2004.
Income before tax was up 7% to 924,000 in 2004 compared to 863,000 in
2003. We continue to strive to reduce costs, and are moving to a lean
manufacturing environment. Profits, although higher in 2004 compared to
2003, were negatively impacted in 2004 by high steel prices which were
only partially absorbed by price increases. Profits were also impacted
by the costs associated with the consolidation of the Cherokee Truck
Body's operation to Armstrong, and continued investment in more
efficient manufacturing processes in our facility.
Net income of $1,402,000 year to date for 2004 compared to $1,664,000 in
2003. The decline in our net income is the result of a reduction in the
deferred tax valuation allowance that was recognized in 2004 and 2003.
Such adjustments accounted for $507,000 and $818,000 of the income tax
benefit recognized in 2004 and 2003, respectively. At November 30, 2004,
our deferred tax valuation allowance was reduced to $40,000. For
financial reporting proposes, we have exhausted the benefits of our net
operating loss carry forwards and expect to begin recording income tax
expense in the first quarter of fiscal 2005.
During the 2004 fiscal year our overall company has strengthened
significantly through the consolidation of manufacturing facilities and
new product offerings. Our backlog is $4,730,000 as of February 2005,
representing a 114% increase over the same period a year ago. The
increase is driven primarily from orders of sugar beet equipment and
feed grinders. We are expecting an improved first half of 2005 due to
the increased backlog, as well as improvements related to the
initiatives to improve our operations as discussed above.
Art's-Way manufactures and distributes farm machinery niche products
including animal feed processing equipment, sugar beet and potato
harvesting equipment, edible bean equipment, land maintenance equipment,
finished mowing, crop shredding equipment and seed planting equipment.
Art's-Way also produces haylage machinery for several original equipment
manufacturers (OEM's). Starting in fiscal 2004, the Company is
manufacturing moldboard plows under its own label under a license
agreement with CNH. Art's-Way also manufactures and distributes truck
bodies used in the agricultural, industrial and commercial industries.
After market service parts are also an important part of the Company's
business.
This news release may include "forward-looking statements" within the
meaning of the federal securities laws. Statements of anticipated future
results are based on current expectations and are subject to a number of
risks and uncertainties that could cause actual results to differ
markedly from those projected or discussed here. The Company cautions
readers not to place undue reliance upon any such forward-looking
statements, as actual results may differ materially from expectations.
The information in this Current Report on Form 8-K shall not be deemed
filed for the purposes of Section 18 of the Securities Exchange Act of
1934, as amended, or otherwise subject to the liabilities of that
section, nor shall it be deemed incorporated by reference in any filing
under the Securities Act of 1933, as amended, except as expressly set
forth by specific reference in such a filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Art's-Way Manufacturing Co., Inc.
(Registrant)
Date: February 24, 2005
By: /s/ John C. Breitung
John C. Breitung, President and CEO