Exhibit 99
For more information
Jay Lemke
Carmichael Lynch Spong
(612) 375-8529
jlemke@clynch.com
ASV Reports Record 3rd Quarter 2003 Results
Sales up 154%, Earnings Per Share Increases from $.05 to $.29
$10 Million Share Repurchase Plan Adopted
GRAND RAPIDS, MN (October 22, 2003) -- ASV, Inc. (NASDAQ: ASVI) today
reported record results for its third quarter ended September 30, 2003. Net
sales for the third quarter of 2003 totaled $29.2 million, compared with $11.5
million for the same period in 2002. Combining the increased sales and an
increased gross profit percentage, net earnings for the third quarter of 2003
increased to $3.1 million, or $.29 per share, compared with $527,000, or $.05
per share, for the third quarter of 2002.
For the nine months ended September 30, 2003, net sales totaled $70.2
million, compared with $32.4 million for the same period in 2002. Net earnings
totaled $6.1 million, or $.59 per share, for the nine months ended September 30,
2003, compared with $1.2 million, or $.11 per share for the same period in 2002.
Commenting on ASV's results, ASV President Gary Lemke stated, "Our
third quarter of 2003 was our second consecutive quarter of record sales and
earnings as market acceptance of rubber track machines continues to increase.
This increased acceptance resulted in increased sales of undercarriages to
Caterpillar Inc. (NYSE: CAT) for use on their Multi-Terrain Loader product line.
Undercarriage sales to Caterpillar accounted for approximately 53% of our sales
for the third quarter of 2003. Our R-Series products also did well during the
quarter, as we continue to expand our dealer network. Our increased production
volume, increased parts sales and slight shift in product mix to higher margin
products aided in increasing our gross profit percentage more than two hundred
basis points compared with our second quarter of 2003."
For the three months ended September 30, 2003, the Company's selling,
general and administrative (S, G & A) expenses decreased, as a percentage of net
sales, to 5.2%, compared with 9.8% for the same period in 2002. Commenting on
this decrease, Lemke stated, "Our ability to keep our S, G & A expenses low even
as we increase sales certainly helped increase our earnings during the third
quarter of 2003. Our undercarriage sales to Caterpillar do not require the same
level of S, G & A expenses as sales to our independent dealers, thereby allowing
ASV to push more dollars to the bottom line."
Outlook
-------
Discussing ASV's overall outlook for the fourth quarter of 2003 Lemke
states, "Our fourth quarter volume has typically been lower as dealers attempt
to carry lower inventory levels over year-end and we anticipate this may occur
again this year. Accordingly, we anticipate our fourth quarter sales will be in
the range of $22-25 million. This will bring our total sales for 2003 in the
range of $92-95 million, up from our previous guidance of $81-88 million. We
anticipate total MTL undercarriage sales to Caterpillar will be approximately
one-half our total sales for the twelve months ending December 31, 2003. In the
fourth quarter of 2003, we anticipate a greater number of common share
equivalents to enter into our computation of earnings per share, a result of the
increase in our share price and the anticipated exercise of expiring
in-the-money stock options. Combining this with our expected fourth quarter
sales, we anticipate our fourth quarter earnings will be in the range of
$.17-.20 per share, resulting in expected earnings per share for fiscal 2003 to
be in the range of $.76-.79 per share."
Continuing, Lemke stated, "With the significant growth we experienced
in 2003, we believe it is too early to provide detailed guidance regarding our
anticipated sales and earnings levels for 2004. With the increased acceptance of
rubber track machines, our continued expansion of the ASV dealer network, an
expected increase in the number of ASV product offerings in 2004 and
Caterpillar's MTL European product launch in the fourth quarter of 2003, we
believe ASV will experience another record year of sales and earnings in 2004."
Warrant Acceleration Notice
---------------------------
ASV recently announced it had issued an acceleration notice to
Caterpillar for approximately one million warrant shares at $21.00 per share
issuable pursuant to the warrant issued to Caterpillar. An acceleration notice
may be issued to Caterpillar when ASV attains certain levels of revenues, gross
profit percentage and average closing share price. ASV believes the sales and
gross profit percentage figures it will report in its Form 10-Q for the period
ended September 30, 2003 will satisfy the levels needed for the issuance of the
next acceleration notice. Should the average closing share price requirement be
met, the next acceleration notice to Caterpillar would pertain to approximately
two million additional shares of ASV common stock at $21.00 per share.
Stock Repurchase Plan
---------------------
ASV also announced its Board of Directors has approved the
implementation of a new stock repurchase plan. Under this new plan, ASV may
repurchase up to $10 million of its common stock on the open market. The Company
intends to fund the repurchases with available funds. The repurchase program is
expected be in effect through the period ending October 14, 2004, or until such
amount of stock is repurchased.
Conference Call
---------------
ASV will conduct a live Webcast at 9 a.m. Central time, Wednesday,
October 22nd to discuss its results for the third quarter of 2003 and its
outlook for the remainder of 2003. The call will be broadcast over the Internet
and can be accessed at either www.vcall.com or ASV's web site, www.asvi.com, in
the investor relations section under the "About ASV" tab. To listen to the call,
go to either of the two Web sites at least 15 minutes prior to the call to
register, download and install any needed audio software. A replay of this call
will be available both telephonically and over the Internet approximately one
hour after its conclusion. The telephonic replay will be available through 11
p.m. Central time, Thursday October 23rd, and can be accessed by dialing
800-428-6051 and entering pass code 307227. The Internet replay will be
available for 30 days and can be accessed at www.vcall.com or www.asvi.com in
the same manner as discussed above.
About ASV
---------
ASV designs, manufactures and sells rubber-tracked, all-purpose
crawlers and related accessories and attachments. ASV also manufactures
rubber-tracked undercarriages, which are a primary component on Caterpillar's
Multi Terrain Loaders. With its patented undercarriage technology, ASV leads all
rubber-tracked, all-purpose crawlers in technology and innovation. ASV's
products are able to traverse nearly any terrain with minimal damage to the
ground, making it effective in industries such as construction, landscaping and
agriculture. For more information, visit ASV's website at www.asvi.com.
Note: The statements set forth above regarding ASV's future expected
sales and earnings levels are forward-looking statements based on current
expectations and assumptions, and entail various risks and uncertainties that
could cause actual results to differ materially from those expressed in such
forward-looking statements. Certain factors may affect whether these anticipated
events occur including ASV's ability to successfully manufacture the machines,
unanticipated delays, costs or other difficulties in the manufacture of the
machines, unanticipated problems or delays experienced by Caterpillar relating
to the manufacturing or marketing of the MTL machines, market acceptance of the
machines, deterioration of the general market and economic conditions, corporate
developments at ASV or Caterpillar and ASV's ability to realize the anticipated
benefits from its relationship with Caterpillar. Any forward-looking statements
provided from time-to-time by the Company represent only management's then-best
current estimate of future results or trends. Additional information regarding
these risk factors and uncertainties is detailed from time to time in the
Company's SEC filings, including but not limited to, its report on Form 10-Q for
the period ended June 30, 2003.
Condensed financial statements are as follows:
A.S.V., INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------------- -------------------------------
2003 2002 2003 2002
------------- -------------- ------------- --------------
Net sales................................... $ 29,188,649 $ 11,474,655 $ 70,215,357 $ 32,366,419
Cost of goods sold.......................... 22,676,469 9,352,291 55,567,464 25,347,394
------------- -------------- ------------- --------------
Gross profit....................... 6,512,180 2,122,364 14,647,893 7,019,025
Operating expenses:
Selling, general and administrative.... 1,510,603 1,120,999 4,554,786 3,705,835
Research and development............... 192,909 248,663 556,795 1,631,408
------------- -------------- ------------- --------------
Operating income................... 4,808,668 752,702 9,536,312 1,681,782
Other income (expense)
Interest expense....................... (31,292) (31,536) (99,968) (95,233)
Other, net............................ 19,067 60,444 106,100 172,983
------------- -------------- ------------- --------------
Income before income taxes......... 4,796,443 781,610 9,542,444 1,759,532
Provision for income taxes.................. 1,717,000 255,000 3,410,000 585,000
------------- -------------- ------------- --------------
NET EARNINGS........................... $ 3,079,443 $ 526,610 $ 6,132,444 $ 1,174,532
============= ============== ============= ==============
Net earnings per common share -- Diluted. $ .29 $ .05 $ .59 $ .11
============= ============== ============= ==============
Diluted weighted average shares ............ 10,743,850 10,253,347 10,430,048 10,248,290
============= ============== ============= ==============
A.S.V., INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS September 30, December 31,
2003 2002
-------------- -------------
CURRENT ASSETS
Cash & short-term investments............................ $ 15,291,514 $ 4,797,398
Accounts receivable, net................................. 21,738,951 14,397,958
Inventories.............................................. 26,833,705 31,834,620
Prepaid expenses and other............................... 517,830 1,099,685
-------------- -------------
Total current assets 64,382,000 52,129,661
PROPERTY AND EQUIPMENT, net.................................. 6,077,102 5,080,536
-------------- -------------
Total assets $ 70,459,102 $ 57,210,197
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LIABILITIES & SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term liabilities................. $ 134,655 $ 129,550
Accounts payable......................................... 6,615,550 2,838,370
Accrued liabilities...................................... 2,246,196 1,795,556
Income taxes payable..................................... 1,475,148 ---
-------------- -------------
Total current liabilities 10,471,549 4,763,476
LONG-TERM LIABILITIES, less current portion.................. 1,879,391 1,979,798
SHAREHOLDERS' EQUITY......................................... 58,108,162 50,466,923
-------------- -------------
Total liabilities & shareholders' equity $ 70,459,102 $ 57,210,197
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