Like GACF Carl! Added at 1.00 +.05 here. Like that they earned .10 in '04, have no debt and about .5mil in cash and then got this new 7.5mil contract today! Thanks...copied the latest earnings for anyone else w/interest: Global Aircraft Solutions Inc. -GACF- Discusses 2004 Financial Results
Monday April 4, 2:50 pm ET
TUCSON, Ariz.--(BUSINESS WIRE)--April 4, 2005--Global Aircraft Solutions Inc. (OTCBB: GACF - News)
-- Revenue Tops $30.8 Million for 2004
-- Net Income exceeds $2.5 Million, $.10 per share for 2004
Global Aircraft Solutions Inc. (OTCBB: GACF - News) today files its 2004 SEC Form 10-KSB setting forth its consolidated operating results for its two operating subsidiaries Hamilton Aerospace Technologies Inc. (HAT) and World Jet Inc. for the fourth quarter and year ended Dec. 31, 2004.
Operating Results
Total revenue for the fourth quarter was $14,152,131, up over 500% compared to total revenue of $2,767,167 for the fourth quarter of 2003. Total annual revenue for 2004 was $30,851,118, up 200% compared to $15,378,352 for 2003. Net income for 2004 was $2,510,662 compared to a net loss of $1,299,428 in 2003.
2004 EBITDA increased to $3,160,845 from negative $496,861 in 2003. The company's total capital expenditures in 2004 were $1,359,124. In the fourth quarter of 2004, the company incurred an expense of approximately $99,000 related to employee annual bonuses and employee appreciation benefits. The company also experienced a one-time IRS expense of $122,000 from an earlier settlement. These two one-time expenses reduced operating profits for the fourth quarter by $221,000.
The disproportionate amount of revenue (more than 45% of total revenue) earned in the fourth quarter 2004 is due largely to approximately $5,725,000 booked on three aircraft trading transactions concluded during that quarter. Management views aircraft trading (i.e., purchasing, refurbishing or parting out undervalued aviation assets for resale to a known buyer or buyers) as the single greatest potential source of future growth for the company. However, until such time as the company demonstrates a consistent track record over time of successful aircraft trading transactions, management is treating all aircraft trading as unique "one off" transactions and is not factoring that business segment into any financial projections.
It should be noted that profit margins earned through commissions or markups from aircraft trading are generally smaller than the profit margins earned by the company through aircraft maintenance or parts sales. However, aircraft trading has the added benefit of generating aircraft maintenance and parts support opportunities for the company's HAT and World Jet subsidiaries as demonstrated in the fourth quarter 2004 by the nearly 200% increase in revenue for both subsidiaries compared to the third quarter 2004. During the same time period, HAT's profit margin fell significantly due to the unexpectedly large volume of work that HAT was required to produce in order for the company to perform the three above-mentioned aircraft trading transactions. This short-term decrease in HAT's profitability was anticipated by management, and accepted as a reasonable exchange for the long-term benefits anticipated from the increased productive capacity of HAT and the development of GACF as an aircraft trading company. This temporary trade-off during the fourth quarter 2004 of a reduction of HAT's profit margin in exchange for the development of GACF's aircraft trading business is the reason that the company significantly exceeded its revenue guidance, but only slightly exceeded its net income guidance.
Because the company expects continued increased sales and net income resulting from additional aircraft trading transactions in 2005, but cannot at this time accurately predict the size of those increases, we are suspending current guidance of $30 million in sales and $3 million in net income for 2005. We do, however, believe we will materially exceed our guidance in sales and exceed this guidance in earnings.
Toward the end of the fourth quarter 2004 GACF executed and announced a multimillion-dollar aircraft parts consignment agreement with Jetran. In order to efficiently manage this inventory, GACF decided to move it to warehouses adjacent to its Tucson, Ariz., Hamilton Aerospace and World Jet facilities. Since no parts sales of any significance took place prior to this move, this consignment agreement had virtually no effect on the company's 2004 financial performance. As of the date of this press release, about 90% of this consignment inventory has been relocated to Tucson, and the company is now performing the monumental task of properly cataloging and storing this large inventory so that it can be efficiently sold. The company anticipates some parts sales to be booked in the first quarter 2005, with sales then rising to significantly higher levels in subsequent reporting periods.
John Sawyer, president of both GACF and HAT, commented, "The officers and directors of Global Aircraft Solutions wish to congratulate all the employees of HAT and World Jet for managing to double the company's revenues during 2004 while still generating profit margins of a level rarely achieved in our industry. Nothing succeeds like success, and we look forward to building upon everyone's hard work in 2004 to create another banner year in 2005."
GACF was successful in attracting large new customers in 2004, which contributed some $12,500,000 (40%) of its revenues. Global expects to retain its working relationship with all of its current customers as well as add additional customers in 2005.
"We are particularly excited about the development of our aircraft trading activities which added over $8,500,000 in new revenue to the company in 2004," remarked GACF and HAT Chairman Ian Herman. "We are presently negotiating several large aircraft trading transactions, and have every expectation that aircraft trading will be our fastest growing business segment and will make significant contributions to our top and bottom lines in 2005."
About Global Aircraft Solutions
Global Aircraft Solutions provides parts support and maintenance, repair and overhaul (MRO) services for large passenger jet aircraft to scheduled and charter airlines and aviation leasing companies. Hamilton Aerospace and World Jet, both divisions of Global Aircraft Solutions, operate from adjacent facilities comprising about 35 acres located at Tucson International Airport. These facilities include hangars, workshops, warehouses, offices and other buildings. Notable customers include United Parcel Service, Falcon Air Express, Jetran International, Goodrich Corp., AAR, National Jet Systems, Pemco, San Antonio Aerospace, Pegasus Aviation, Northern Air Cargo, Shaheen Airlines, Iraqi Airways, Aero California and Asia Pacific Airlines.
Global's Web site is located at www.globalaircraftsolutions.com. The Hamilton Aerospace Web site is located at www.hamaerotech.com.
Except for the historical information presented, the above statements are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 or regulations thereunder. These forward-looking statements are subject to risks and uncertainties, and actual results may differ materially. These risks include the economic health of the airline industry, demand for Global Aircraft Solutions' services, and competitive pricing pressures. In addition, other risks are detailed in Global's Form 10-KSB filed on April 4, 2005. These statements speak only as of above date and Global disclaims any intent or obligation to update them.
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Contact:
Global Aircraft Solutions Inc, Tucson
Ian Herman, 520-294-3481
iherman@hamaerotech.com
or
Alliance Advisors, LLC
Alan Sheinwald, 914-244-0062
asheinwald@allianceadvisors.net
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Source: Global Aircraft Solutions Inc. |
