Fields Aircraft Spares Announces Record Revenue and Operating Income for Fiscal 1998
SIMI VALLEY, Calif.--(BUSINESS WIRE)--April 21, 1999--
-- Revenues Increased 97% to $23.9m in fiscal 1998 from $12.1m in fiscal 1997
-- Operating income increased 11.7% to $1.7m in fiscal 1998 from $1.5m in fiscal 1997
-- EBITDA rose 32% to $2.2m in fiscal 1998 from $1.6m in fiscal 1997
Fields Aircraft Spares, Inc. (Nasdaq:FASI - news) today announced results for its 1998 fiscal year ended January 1, 1999.
The Company reported revenues of $23.9m for the fiscal year ended January 1, 1999, a 97% increase over the prior fiscal year. This increase is attributable to internal growth as well as the inclusion of revenues from Flightways Manufacturing, Inc. and Skylock Industries, two subsidiaries acquired during the 1998 fiscal year.
A rise in operating income from $1.5m in fiscal 1997 to $1.7m in fiscal 1998 was also attributable to the two acquisitions made as part of Fields Aircraft Spares' roll-up strategy. EBITDA, before one-time charges, similarly increased by $530,000, or 32%, from $1.6m in fiscal 1997 to $2.2m in fiscal 1998.
As shown on the accompanying Consolidated Statements of Operations, during the 1998 fiscal year Fields recognized a one-time charge of $1.2m to reflect non-recurring expenses relating to the acquisition of a new facility, relocation costs and the initial expansion of the newly acquired manufacturing subsidiaries.
This one-time charge combined with acquisition related amortization of goodwill and interest expense resulted in a net loss for the Company of $1.95m or $(0.82) per common share and $(0.51) per diluted share for fiscal 1998, as compared to a net loss of $147,000 or $(0.08) per common share and $(0.06) per diluted share for fiscal 1997.
Cost of sales increased from 60% to 69% in fiscal year 1998. This was the result of a change in product mix primarily a result of the inclusion of the two manufacturing acquisitions, which have a higher cost of goods sold percentage than parts distribution, including the completion of business booked at those subsidiaries prior to acquisition; specifically, the completion of promotional work booked at a loss; warranties; and repairs.
The Company also had additional one-time costs of $80,000 for fiscal 1998 attributable to Y2K. Management expects up to an additional $170,000 Y2K charge for fiscal 1999.
''With the nearly doubling of our revenues, we consider our roll-up strategy to have been very successful to date and we intend to continue to implement this strategy,'' commented the Company's President and CEO, Mr. Alan Fields.
''We have expanded our infrastructure to accommodate current and future subsidiaries, and are reviewing a number of candidates as well as actively seeking the financing needed to complete one or more of those acquisitions.
''Following the completion of both the Flightways and Skylock acquisitions in the first half of fiscal 1998, we had expected to add additional subsidiaries in the second half of 1998. However, we found that the condition of the capital markets for SmallCap companies had changed,'' he continued.
''While we continue to actively seek additional acquisitions and financing, we are also focusing our efforts on minimizing expenses and realizing synergies and economies of scale while supporting an infrastructure which will allow us to move forward and integrate future acquisitions.''
Mr. Fields went on to comment on first quarter 1999 results and expectations for the current fiscal year. ''U.S. airlines are currently flying record numbers of passengers. This bodes well for our company over the long run. However, the high capacity utilization of aircraft, has resulted in a number of customers rescheduling deliveries in the short term, impacting us negatively.
''The result is a slight downturn of first quarter 1999 revenues to $5.2m from $5.7m in the first quarter 1998. Although we expect the current slow down to extend into the second quarter, FAA mandates on maintenance and repair schedules should allow us to make up that business in the third and fourth quarters of the year.''
On March 30, 1998, the Company changed its fiscal year to a 52-53 week year ending on the Friday of the calendar week which contains the last business day of December, which is why comparable periods for 1998 and 1997 end on different dates.
About Fields Aircraft Spares
Fields Aircraft Spares Inc., through its wholly owned subsidiaries Fields Aircraft Spares Incorporated, Fields Aero Management, Inc., Flightways Manufacturing, Inc. and Skylock Industries, is a manufacturer and a leading distributor of aircraft cabin interior replacement products and is a redistributor for a wide variety of factory new parts applicable to the majority of commercial aircraft models and manufacturers.
Additional information about Fields, including access to copies of its periodic filings with the Securities and Exchange Commission, is available on the Company's Web site at www.fieldsair.com.
Statements in this news release that relate to future plans, financial results or projections, events or performance are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are subject to risks and uncertainties that could cause actual results to differ materially. Actual results may differ from such forward-looking statements as a result of a number of factors, including but not limited to competitive factors and pricing pressures, ability to obtain profitability and obtain enough capital or financing to sustain the Company until such time, the price and availability of aircraft parts and other materials, successful execution of the Company's expansion plans, including the ability to complete contemplated acquisitions and to successfully combine the businesses, the ability to control costs, the ability to maintain existing customer or vendor relationships, shifts in market demand, general economic conditions, Year 2000 issues and other risks and uncertainties discussed in periodic reports filed by the Company with the Securities and Exchange Commission and which the Company urges investors to consider. Copies of filed reports may be requested from the Company or obtained from the Company's web site.
Fields Aircraft Spares
Consolidated Statements of Operations
Three months ended Twelve monthes ended(a)
Jan. 1, Dec. 31, Jan. 1, Dec. 31,
1999 1997 1999 1997
Sales $ 6,341,000 $3,657,000 $23,851,000 $12,101,000
Cost of sales $ 4,943,000 $2,078,000 $16,536,000 $ 7,214,000
Gross profit $ 1,398,000 $1,579,000 $ 7,315,000 $ 4,887,000
Operating
expenses $ 1,716,000 $ 921,000 $ 5,597,000 $ 3,349,000
Income (loss)
from operations $ (318,000) $ 658,000 $ 1,718,000 $ 1,538,000
Other expense:
Interest expense $ 719,000 $ 427,000 $ 2,249,000 $ 1,676,000
Other expense $ 210,000 $ -- $ 1,410,000 $ --
Total other
expense $ 929,000 $ 427,000 $ 3,659,000 $ 1,676,000
Income (loss)
before provision
for income
taxes $(1,247,000) $ 231,000 $(1,941,000) $ (138,000)
Provision for
income taxes $ -- $ 2,000 $ 9,000 $ 9,000
Net income
(loss) $(1,247,000) $ 229,000 $(1,950,000) $ (147,000)
Net income (loss)
per share -
basic $ (0.49) $ 0.10 $ (0.82) $ (0.08)
Net Income (loss)
per share -
diluted $ (0.33) $ 0.08 $ (0.51) $ (0.06)
Weighted average
number of
common shares
outstanding -
basic 2,483,781 2,079,571 2,483,781 2,079,571
Weighted average
number of
common shares
outstanding -
diluted 3,463,912 2,435,378 3,456,355 2,345,378
Note (a): On March 30, 1998, the Group changed its fiscal year to a
52-53 week year ending on the Friday of the calendar week (beginning
on Monday and ending on Sunday) which contains the last business day
of December. The 1998 fiscal year ended on January 1, 1999. The
comparable period for the prior year ended December 31, 1997.
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Contact:
Fields Aircraft Spares, Inc., Simi Valley
Alan Fields, 805/583-0080 |
