SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of earliest event reported: May 15, 2003
LMI AEROSPACE, INC.
(Exact Name of Registrant as Specified in Its Charter)
Missouri
(State or Other Jurisdiction of Incorporation)
0-24293 43-1309065
(Commission File Number) (I.R.S. Employer Identification No.)
3600 Mueller Road, St. Charles, Missouri 63302-0900
(Address of Principal Executive Offices) (Zip Code)
(636) 946-6525 (Registrant's Telephone Number,
Including Area Code)
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Item 12. Results of Operations and Financial Condition.
On May 15, 2003, LMI Aerospace, Inc. issued a press release relating to its
financial performance during the First Quarter of 2003. The text of the
announcement is attached hereto as Exhibit 99.1.
Exhibit Number Description
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99.1 Text of Press Release, dated May 15, 2003,
issued by LMI Aerospace, Inc.
SIGNATURE
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 thereunto duly authorized.
Date: May 16, 2003
LMI AEROSPACE, INC.
By: /s/ Lawrence E. Dickinson
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Lawrence E. Dickinson
Chief Financial Officer and Secretary
EXHIBIT INDEX
Exhibit Description
- ------- -----------
99.1 Text of Press Release, dated May 15, 2003, issued by
LMI Aerospace, Inc.
Exhibit 99.1
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LMI Aerospace, Inc.
Post Office Box 900
St. Charles, Missouri 63302
For more information,
Contact Ed Dickinson, 636/916-2150
FOR IMMEDIATE RELEASE
LMI AEROSPACE REPORTS RESULTS FOR FIRST QUARTER OF 2003
Sales from acquisition offset declines in aerospace markets
ST. LOUIS, May 15, 2003 - LMI Aerospace, Inc. (Nasdaq:LMIA) announced today that
sales in the first quarter of 2003 were $20.8 million versus $17.9 million in
the quarter ended March 31, 2002. Acquisitions completed in 2002 accounted for
the increased sales.
LMI recorded a net loss of $957,000 or $0.12 per common share in the first
quarter of 2003, compared to a loss of $640,000 or $0.08 per common share in the
first quarter of 2002. The net loss in 2002 included a charge of $1.1 million,
net of income taxes, for the adoption of Statement of Financial Accounting
Standards No. 142, Goodwill and Other Intangibles. Excluding this charge, the
Company would have reflected 2002 net income of $464,000 or $0.06 per share.
Gross profit for the first quarter of 2003 was $2.2 million, or 10.6 percent of
net sales, compared to $3.8 million and 21.5 percent in the first quarter of
2002. The decrease in gross margin resulted from production difficulties at the
Company's St. Charles and Auburn locations, primarily related to new production
of military components, and to a decline in the gross margin at Tempco because
of reduced sales and a resulting inability to cover fixed costs. The Company is
seeking re-pricing for military components produced in St. Charles and Auburn,
and has filed a claim for excess costs related to starting up these programs.
Selling, general and administrative expenses of $3.3 million in the quarter were
$518,000 higher than the year-ago quarter, due primarily to the addition of
Versaform's expenses in 2003.
Backlog at March 31, 2003, was approximately $63.6 million, up from $57.8
million at the end of the first quarter of 2002.
The Company also announced that borrowings on the Company's $10.0 million
revolving line of credit were $7.0 million at the end of the quarter. Currently,
the Company has $6.2 million outstanding on the line of credit.
"Our operational results in the first quarter of 2003 continued to be affected
by the excess costs incurred on start-up of certain military aircraft and
business jet programs," said Ronald Saks, president and chief executive officer
of LMI Aerospace, Inc. "We expect that the return of portions of these work
statements to our customers and improved production efficiency on those
remaining will reduce future losses, but we do not anticipate achieving
acceptable profitability until negotiated re-pricing of remaining components is
completed. Our negotiations have not reached a stage that would allow us to
record the benefit of any excess cost recovery or re-pricing, nor can we
estimate a time when negotiations may conclude."
The Company announced that it has cost reduction programs in place at all LMI
locations which are expected to reduce quarterly costs by $500,000. It is also
developing a more comprehensive cost reduction plan, to be adopted by June 30,
2003, which may include infrastructure changes and headcount reductions, in
order to better address the continued low sales volume environment in the
aerospace and semiconductor markets.
Based on current production rates and giving effect to the current cost
reduction program, LMI is projecting improved gross margins in future quarters.
The Company estimates annual sales for 2003 in the range of $90 million to $95
million, with gross margins for the year of 14 percent to 17 percent, reflecting
anticipated improvement as 2003 progresses. No benefit from our pending claim
negotiation has been included in this forecast.
"We are holding to our current strategy in a difficult market environment,
emphasizing the development of our supply chain management expertise and our
kitting, assembly and distribution services, which are targeted to several key
customers," Saks said. "We remain optimistic that LMI will be the preferred
supplier to our customers when our markets return to more normal levels."
LMI Aerospace, Inc. is a leading supplier of quality components to the aerospace
and technology industries. The Company operates twelve manufacturing facilities
that fabricate, machine, finish and integrate formed, close tolerance aluminum
and specialty alloy components for commercial, corporate, regional and military
aircraft, laser equipment used in the semiconductor and medical industries, and
for commercial sheet metal industries.
This press release includes forward-looking statements related to LMI
Aerospace's outlook for 2003 and future periods, which are based on current
management expectations. Such forward-looking statements are subject to various
risks and uncertainties, many of which are beyond the control of LMI Aerospace,
Inc. Actual results could differ materially from the forward-looking statements
as a result, among other things, of the factors detailed from time to time in
LMI Aerospace's filings with the Securities and Exchange Commission. Please
refer to the Risk Factors contained in the Company's Annual Report on Form 10-K
for the year ended December 31, 2002 for more details.
tables follow . . .
# # #
LMI Aerospace, Inc.
Condensed Consolidated Statements of Operations
(Amounts in thousands, except per share data)
(Unaudited)
For the Three Months Ended March 31,
2003 2002
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Net sales $ 20,842 $ 17,908
Cost of sales 18,623 14,102
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Gross profit 2,219 3,806
Selling, general and administrative expenses 3,310 2,792
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Income (loss) from operations (1,091) 1,014
Other expense:
Interest (440) (262)
Other, net - (9)
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Income (loss) before income taxes (1,531) 743
Provision for (benefit of) income taxes (574) 279
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Income (loss) before cumulative effect of change in 464
accounting principle (957)
Cumulative effect of change in accounting principle, net of
income tax benefit of $663 - 1,104
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Net loss $ (957) $ (640)
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Amounts per common share basic and dilutive:
Income (loss) before cumulative effect of change in accounting
principle $ (0.12) $ 0.06
Cumulative effect of change in accounting principle - (0.14)
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Net loss per common share $ (0.12) $ (0.08)
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Weighted average common shares outstanding 8,181,786 8,023,930
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Weighted average common shares outstanding-assuming 8,146,983
dilution 8,181,786
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LMI Aerospace, Inc.
Condensed Consolidated Balance Sheets
(Amounts in thousands, except share and per share data)
March 31, 2003 December 31,
(unaudited) 2002
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Assets
Current assets:
Cash and cash equivalents $ 596 $ 1,182
Trade accounts receivable, net 11,600 11,392
Inventories 26,198 25,181
Prepaid expenses 1,253 978
Deferred income taxes 1,389 1,389
Income taxes receivable 2,080 1,501
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Total current assets 43,116 41,623
Property, plant, and equipment, net 25,012 25,986
Goodwill, net 5,653 5,653
Customer intangible assets, net 4,184 4,267
Other assets 371 336
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$ 78,336 $ 77,865
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Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 6,167 $ 6,107
Accrued expenses 2,929 2,846
Current installments of long-term debt and capital lease
obligations 11,425 4,616
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Total current liabilities 20,521 13,569
Long-term debt and capital lease obligations, less current
installments 19,057 24,621
Deferred income taxes 1,949 1,939
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Total long-term liabilities 21,006 26,560
Stockholders' equity:
Common stock of $.02 par value; authorized 28,000,000 shares; issued
8,736,427 at December 31, 2002
and at March 31, 2003 175 175
Additional paid-in capital 26,171 26,171
Treasury Stock, at cost, 554,641 and 554,641 shares at
December 31, 2002 and March 31, 2003, respectively (2,632) (2,632)
Accumulated other comprehensive income (loss) 13 (17)
Retained earnings 13,082 14,039
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Total stockholders' equity 36,809 37,736
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$ 78,336 $ 77,865
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