UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Mark One)
[X] Annual Report Pursuant To Section 15(d) Of The Securities Exchange Act
of 1934
For the fiscal year ended December 31, 2003
OR
[ ] Transition Report Pursuant To Section 15(d) Of The Securities Exchange
Act of 1934
For the transition period from to
Commission file number 000-24293
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A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
LMI Aerospace, Inc. Profit Sharing and Savings Plan and Trust
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
LMI Aerospace, Inc.
3600 Mueller Road
St. Charles, Missouri 63302-0900
REQUIRED INFORMATION
(a) Financial Statements. Filed as part of this Report on Form 11-K are the
financial statements and the schedules thereto of the LMI Aerospace,
Inc. Profit Sharing and Savings Plan and Trust as required by Form 11-K,
together with the report thereon of BKD, LLP, independent auditors,
dated July 8, 2004.
(b) Exhibits:
Exhibit No. Description
----------- -----------
23.1 Consent of BKD, LLP.
LMI Aerospace, Inc. Profit Sharing and
Savings Plan and Trust
EIN 43-1309065 PN 002
Accountants' Report and Financial Statements
December 31, 2003 and 2002
LMI Aerospace, Inc. Profit Sharing
and Savings Plan and Trust
December 31, 2003 and 2002
Contents
Independent Accountants' Report............................................1
Financial Statements
Statements of Net Assets Available for Benefits........................3
Statements of Changes in Net Assets Available for Benefits ............4
Notes to Financial Statements..........................................5
Supplemental Schedule
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)........10
Independent Accountants' Report
Board of Trustees
LMI Aerospace, Inc. Profit Sharing and
Savings Plan and Trust
St. Charles, Missouri
We were engaged to audit the accompanying statement of net assets available for
benefits (modified cash basis) of LMI Aerospace, Inc. Profit Sharing and Savings
Plan and Trust as of December 31, 2003, and the related statement of changes in
net assets available for benefits (modified cash basis) for the year then ended.
Other accountants were engaged to audit the financial statements (modified cash
basis) of LMI Aerospace, Inc. Profit Sharing and Savings Plan as of and for the
year ended December 31, 2002, whose report dated June 27, 2003, expressed an
unqualified opinion on those statements. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
As described in Note 2, these financial statements and supplemental schedule
were prepared on a modified cash basis of accounting, which is a comprehensive
basis of accounting other than accounting principles generally accepted in the
United States of America.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of LMI Aerospace,
Inc. Profit Sharing and Savings Plan as of December 31, 2003, and the changes in
its net assets available for benefits for the year then ended, on the basis of
accounting described in Note 2.
Board of Trustees
LMI Aerospace, Inc. Profit Sharing and
Savings Plan and Trust
Page 2.
The accompanying supplemental schedule of assets (held at end of year) (modified
cash basis) is presented for the purpose of additional analysis and is not a
required part of the basic financial statements, but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic financial statements and, in our opinion, is fairly
stated, in all material respects, in relation to the basic financial statements
taken as a whole.
/s/ BKD, LLP
St. Louis, Missouri
July 8, 2004
Federal Employer Identification Number: 44-0160260
LMI Aerospace, Inc. Profit Sharing and Savings Plan and Trust
Statements of Net Assets Available for Benefits
December 31, 2003 and 2002
2003 2002
----------------------------------
Investments $ 11,193,074 $ 10,060,263
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Net Assets Available for Benefits $ 11,193,074 $ 10,060,263
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LMI Aerospace, Inc. Profit Sharing and Savings Plan and Trust
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31, 2003 and 2002
2003 2002
-------------------------------------
Investment Income (Loss)
Net appreciation (depreciation) in fair value of investments $ 832,602 $ (3,231,517)
Interest and dividends 200,415 195,112
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Net investment income (loss) 1,033,017 (3,036,405)
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Contributions
Employer
Cash 236,385 86,096
Company stock -- 111,800
Participants 1,110,759 1,234,445
Rollovers 3,153 20,943
------------ -------------
1,350,297 1,453,284
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Total additions, net depreciation 2,383,314 (1,583,121)
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Deductions
Benefits paid to participants 1,192,060 693,287
Administrative expenses 58,443 23,625
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Total deductions 1,250,503 716,912
------------ -------------
Net Increase (Decrease) 1,132,811 (2,300,033)
Net Assets Available for Benefits, Beginning of Year 10,060,263 12,360,296
------------ -------------
Net Assets Available for Benefits, End of Year $ 11,193,074 $ 10,060,263
============ =============
LMI Aerospace, Inc. Profit Sharing and
Savings Plan and Trust
Notes to Financial Statements
December 31, 2003 and 2002
Note 1: Description of the Plan
The following description of the LMI Aerospace, Inc. Profit Sharing and
Savings Plan and Trust (the "Plan") provides only general information.
Participants should refer to the Summary Plan Description for a more
complete description of the Plan's provisions, which is available from
the Plan Administrator.
General
The Plan is a defined contribution plan covering all employees of LMI
Aerospace, Inc and certain subsidiaries (Leonard's Metals, Inc., LMI
Finishing, Inc. and Precise Machining, LLC) (collectively the "Company")
who have at least 1,000 hours of service and six months of continuous
employment. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).
Contributions
Each year, the Company contributes to the Plan a percentage of eligible
participant contributions as determined by the Company's Board of
Directors. For the years ended December 31, 2003 and 2002, the Board
elected to contribute $0.50 for each $1 contributed by each participant
up to a maximum employer matching contribution of $675. Additional
amounts may be contributed at the discretion of the Company's Board of
Directors. Participants may contribute up to 60% of their annual wages.
Contributions are subject to certain limitations. Participants direct
the investment of their contributions as well as the Company's
contribution into various investment options offered by the Plan. The
Plan currently offers 12 mutual funds and the common stock of the
Company as investment options for participants.
Participant Accounts
Each participant's account is credited with the participant's
contribution, the Company's contribution and plan earnings and is
charged with an allocation of administrative expenses. Allocations are
based on participant earnings or account balances, as defined. The
benefit to which a participant is entitled is the benefit that can be
provided from the participant's vested account.
Vesting
Participants are immediately vested in their voluntary and employer
matching contributions plus earnings thereon. Vesting in the Company's
discretionary contribution portion of their accounts plus earnings
thereon is based on years of continuous service. A participant is fully
vested after seven years of continuous service. The nonvested balance is
forfeited upon termination of service. Forfeitures are allocated among
active participants on a pro-rata basis.
Payment of Benefits
Upon termination of service, an employee may elect to receive either a
lump-sum amount equal to the value of his account or a joint and
survivor annuity.
Participant Loans
Participants may borrow from their fund accounts a minimum of $1,000 up
to a maximum of $50,000 or 50% of their account balance, whichever is
less. The loans are secured by the balance in the participant's account
and bear interest at rates that range from 4.5% to 10.0%, which are
commensurate with local prevailing rates as determined by the plan
administrator.
Plan Termination
Although it has not expressed an intention to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan, subject to the provisions of ERISA. In the event of
plan termination, participants will become 100% vested in their
accounts.
Note 2: Summary of Significant Accounting Policies
Method of Accounting
The Plan maintains its accounts on the modified cash basis of
accounting, which is a comprehensive basis of accounting other than
accounting principles generally accepted in the United States of
America. Consequently, certain revenue and the related assets are
recognized when received rather than when earned, and certain expenses
are recognized when paid rather than when the obligation is incurred.
Valuation of Investments and Income Recognition
Quoted market prices are used to value investments. The Plan's
investment in the Federated Capital Preservation Fund is carried at
contract value.
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the cash basis. Dividends are recorded on
the ex-dividend date.
Use of Estimates
The preparation of financial statements in conformity with the modified
cash basis of accounting requires management to make estimates and
assumptions that affect the reported amounts of assets and changes
therein and disclosure of contingent assets at the date of the financial
statements. Actual results could differ from those estimates.
Plan Tax Status
The Plan obtained its latest determination letter on January 17, 2001,
in which the Internal Revenue Service stated that the Plan and related
trust, as then designed, were in compliance with the applicable
requirements of the Internal Revenue Code and, therefore, not subject to
tax. The Plan has been amended since receiving the determination letter.
However, the plan administrator believes that the Plan and related trust
are currently designed and being operated in compliance with the
applicable requirements of the Internal Revenue Code.
Payment of Benefits
Benefit payments to participants are recorded upon distribution.
Note 3: Investments
The Plan's investments are held by a bank-administered trust fund. The
following table presents the Plan's investments. Investments that
represent 5% or more of total plan assets are separately identified.
2003 2002
---------------------------------
Investments at Fair Value
Mutual Funds
Federated Capital Preservation Fund $ 2,743,211 $ 1,579,974
Fidelity Advisor Equity Growth Fund 2,290,918 2,219,916
Janus Balanced Fund 2,880,768 3,282,497
Other 767,549 50,207
LMI Aerospace, Inc. Common Stock 1,766,377 2,193,016
------------ ------------
10,448,823 9,325,610
------------ ------------
Investments at Estimated Fair Value
Participant Loans 744,251 734,653
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Total investments $ 11,193,074 $ 10,060,263
============ ============
During the years ended 2003 and 2002, the Plan's investments (including
gains and losses on investments bought, sold and held during the year)
appreciated (depreciated) in value by $832,602 and $(3,231,517),
respectively, as follows:
2003 2002
---------------------------------
Investments at Fair Value
LMI Aerospace, Inc. Common Stock $ (163,940) $ (1,971,387)
Mutual Funds 996,542 (1,260,130)
----------- -------------
Net appreciation (depreciation) in fair value $ 832,602 $ (3,231,517)
=========== =============
Interest and dividends realized on the Plan's investments for the years
ended 2003 and 2002 were $200,415 and $195,112, respectively.
Information on the averages of the fully benefit-responsive contracts
embedded within the Federated Capital Preservation Fund carried at
contract value is as follows:
2003
--------------------
Average yield 4.02%
Crediting interest rate at December 31 3.48%
Fair value $ 2,796,000
Note 4: Related Party Transactions
Active participants can purchase LMI Aerospace, Inc. common stock from
their existing account balances. At December 31, 2003 and 2002,
participants held 865,870 and 987,844 shares of LMI Aerospace, Inc.
common stock, respectively.
Certain plan investments are shares of mutual funds managed by
Federated, which is a service organization for the trustee of the Plan.
The Plan incurs expenses related to general administration and record
keeping. The Plan sponsor pays these expenses and certain accounting and
auditing fees relating to the Plan. The Plan also invests in common
stock of the Plan sponsor and funds related to the Plan custodian.
Note 5: Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for benefits
per the financial statements at December 31, 2003, to Form 5500:
2003
----------------
Net assets available for benefits per the financial
statements $ 11,193,074
Additional deemed distributions of participant loans 34,180
-----------
Net assets available for benefits per Form 5500 $ 11,227,254
===========
The following is a reconciliation of benefits paid to participants per
the financial statements for the year ended December 31, 2003, to Form
5500:
2003
----------------
Benefits paid to participants per the financial statements $ 1,192,060
Less: Additional deemed distributions of participant loans 34,180
-----------
Benefits paid to participants per Form 5500 $ 1,157,880
===========
Supplemental Schedule
LMI Aerospace, Inc. Profit Sharing and
Savings Plan and Trust
EIN 43-1309065 PN 002
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2003
Description Current
Investment Type and Issuer of Investment Value
- -----------------------------------------------------------------------------------------------------------
Mutual Funds
* Federated Capital Preservation Fund 274,321 shares $ 2,743,211
* Federated Stock Trust 754 shares 25,853
* Federated Kaufmann Fund 37,826 shares 187,619
* Federated Mini-Cap Index Fund 6,174 shares 82,362
* Federated Max-Cap Index Fund 1,014 shares 22,778
* Federated Total Return Bond Fund 7,645 shares 82,871
* Federated Capital Appreciation Fund 2,946 shares 70,309
Baron Growth Fund 3,715 shares 131,672
Fidelity Advisor Equity Growth Fund 51,458 shares 2,290,918
Janus Balanced Fund 144,472 shares 2,880,768
Janus Advisor International Growth Fund 1,510 shares 36,641
Constellation Clover Small Cap Value Fund 5,679 shares 127,444
* LMI Aerospace, Inc. Common Stock 865,870 shares 1,766,377
Participant Loans 4.5% - 10.0% 744,251
------------
$ 11,193,074
============
* Represents a party-in-interest to the Plan.
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
LMI AEROSPACE, INC. PROFIT SHARING
AND SAVINGS PLAN AND TRUST
By: LMI AEROSPACE, INC., as Plan Administrator
Date: August 24, 2004 By: /s/ Lawrence E. Dickinson
-------------------------------------------
Lawrence E. Dickinson
Chief Financial Officer and Secretary