<DOCUMENT>
<TYPE>NT 10-K
<SEQUENCE>1
<FILENAME>g68205ntnt10-k.txt
<DESCRIPTION>KELLSTROM INDUSTRIES, INC. FORM 12B-25 12-31-2000
<TEXT>
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 12b-25
NOTIFICATION OF LATE FILING
Commission File Number 0-23764
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(Check one)
[X] Form 10-K and Form 10-KSB [ ] Form 11-K
[ ] Form 20-F [ ] Form 10-Q and Form 10-QSB [ ] Form N-SAR
For period ended December 31, 2000
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[ ] Transition Report on Form 10-K and Form 10-KSB
[ ] Transition Report on Form 20-F
[ ] Transition Report on Form 11-K
[ ] Transition Report on Form 10-Q and Form 10-QSB
[ ] Transition Report on Form N-SAR
For the transition period ended
-----------------------------------------------
READ ATTACHED INSTRUCTION SHEET BEFORE PREPARING FORM. PLEASE PRINT OR TYPE.
Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein.
If the notification relates to a portion of the filing checked above,
identify the item(s) to which the notification relates:_________________________
________________________________________________________________________________
PART I
REGISTRANT INFORMATION
Full name of registrant Kellstrom Industries, Inc.
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Former name if applicable Not Applicable
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Address of principal executive office (STREET AND NUMBER)
1100 International Parkway
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City, State and Zip Code Sunrise, FL 33323
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<PAGE> 2
PART II
RULE 12b-25(b) AND (c)
If the subject report could not be filed without unreasonable effort or
expense and the registrant seeks relief pursuant to Rule 12b-25(b), the
following should be completed. (Check appropriate box.)
[X] (a) The reasons described in reasonable detail in Part III of
this form could not be eliminated without unreasonable effort or
expense;
[X] (b) The subject annual report, semi-annual report, transition
report on Form 10-K, 10-KSB, 20-F, 11-K or Form N-SAR, or portion
thereof will be filed on or before the 15th calendar day following
the prescribed due date; or the subject quarterly report or
transition report on Form 10-Q, 10-QSB, or portion thereof will be
filed on or before the fifth calendar day following the prescribed
due date; and
[ ] (c) The accountant's statement or other exhibit required by Rule
12b-25(c) has been attached if applicable.
PART III
NARRATIVE
State below in reasonable detail the reasons why Forms 10-K, 10-KSB, 11-K,
20-F, 10-Q, 10-QSB, N-SAR or the transition report portion thereof could not be
filed within the prescribed time period. (Attach extra sheets if needed.)
The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 2000 could not be filed within the prescribed time period because
certain information and data relating to and necessary for the completion of the
Registrant's financial statements and management's discussion and analysis of
financial condition and results of operations could not be obtained by the
Registrant within such time period without unreasonable effort or expense.
PART IV
OTHER INFORMATION
(1) Name and telephone number of person to contact in regard to this
notification.
OSCAR TORRES (954) 845-0427
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(Name) (Area Code) (Telephone Number)
(2) Have all other periodic reports required under Section 13 or 15(d) or
the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act
of 1940 during the preceding 12 months or for such shorter period that the
registrant was required to file such report(s) been filed? If the answer is no,
identify report(s).
[X] Yes [ ] No
(3) Is it anticipated that any significant change in results of operations
from the corresponding period for the last fiscal year will be reflected by the
earnings statements to be included in the subject report or portion thereof?
[X] Yes [ ] No
If so: attach an explanation of the anticipated change, both narratively
and quantitatively, and, if appropriate, state the reason why a reasonable
estimate of the results cannot be made.
Certain changes have occurred as publicly disclosed in a press release on
April 2, 2001, a copy of which is attached as Exhibit A.
KELLSTROM INDUSTRIES, INC.
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(Name of Registrant as Specified in Charter)
Has caused this notification to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: April 2, 2001 By: /s/ Oscar Torres
--------------------------------
Oscar Torres
Chief Financial Officer
<PAGE> 3
Exhibit A
KELLSTROM
INDUSTRIES, INC.
FOR IMMEDIATE RELEASE
KELLSTROM ANNOUNCES FOURTH QUARTER AND YEAR-END RESULTS
Positive Cash Flow From Operations Totals $25.1 Million for 2000
Sunrise, FL - April 2, 2001 -- Kellstrom Industries, Inc. [NASDAQ: KELL] today
announced results for its fourth quarter and year ended December 31, 2000.
Revenues for the fourth quarter increased by 3.6% to $96.2 million from $92.9
million in 1999. As announced in early January 2001, after the completion of the
acquisition of the aircraft and engine parts resale business of Aviation Sales
Company (the "Acquisition") on December 1, 2000, in connection with the
Acquisition and due to depressed market conditions in the fourth quarter,
Kellstrom incurred unusual charges and wrote-down certain inventories and
operating assets, both of which depressed profitability. These charges included:
o $1.3 million, net of tax, extraordinary loss related to prepayment
penalties and the write-off of deferred financing costs in connection
with the pay down of $11.25 million in senior subordinated notes;
o $3.0 million in severance and other realignment costs primarily
incurred in connection with the elimination of redundant or unnecessary
positions in connection with the Acquisition and the ongoing process of
consolidating seven Kellstrom facilities into one;
o $50.6 million of non-cash inventory write-downs and impairment charges
related to the Company's inventory and lease portfolio, taking the
combined book value down to $294.2 million.
Excluding these expenses and charges, Kellstrom would have reported net income
of $194,000 or $.02 per diluted share for the 2000 fourth quarter. Inclusive of
the aforementioned expenses and charges, there was a fourth quarter net loss of
$34.9 million, or $2.93 per diluted share. In 1999's fourth quarter, Kellstrom
reported net income of $3.9 million, or $0.31 per diluted share.
Revenues for the year ended December 31, 2000 were up 7.0% to $354.0 million
from $330.9 million in 1999. Net income for the year, excluding the expenses and
charges noted above, was $3.9 million, or $.32 per diluted share. Net loss
inclusive of the aforementioned expenses and charges for the year ended December
31, 2000 was $31.3 million, or $2.63 per diluted share after such charges. In
1999, Kellstrom reported net income of $20.5 million, or $1.48 per diluted
share.
For the full year 2000, the Company generated $25.1 million of cash flow from
operations as compared to cash flow used in operations of $48.6 million for the
full year 1999. Cash flow used in operations for the fourth quarter was $2.7
million as compared to cash flow provided by operations of $3.6 million for the
fourth quarter of 1999.
(more)
<PAGE> 4
Kellstrom Industries, Inc. News Release Page 2
April 2, 2001
Oscar Torres, Kellstrom's Chief Financial Officer pointed out, "For the last
five quarters, we have been using free cash flow to pay down our bank debt, as
well as for acquisitions and capital expenditures. During the last quarter of
2000 we replaced $11.3 million of debt with a remaining average maturity of 20
months, with $30 million of debt with a maturity of seven years. As an
accommodation and in recognition of our changing business environment resulting
in our not being in compliance with certain financial covenants contained in our
senior credit facility, our commercial lenders have been supportive of the
Company by amending our financial covenants. As previously reported, we have
commenced an exchange offer, led by Banc of America Securities as our financial
advisor, for our $140.3 million in convertible notes. The exchange offer is
intended to address the liquidity concerns related to the repayment of principal
in 2002 and 2003 on such notes and grant the Company greater operational
flexibility in the current business environment."
Mr. Torres went on to say; "We are progressing in the integration of the
Acquisition and the realignment of our organization from four divisions into
two, comprised of the Commercial Aerospace Business Unit and Defense Aerospace
Business Unit. We have reduced headcount by about 30% with a portion of the
severance expense and other realignment costs taken in the fourth quarter of
2000, we are left with the remainder for the first half of 2001. With the
Company moving the majority of its operations to the Miramar facility, we are
now actively seeking to dispose of our former headquarters building in Sunrise,
as well as other smaller properties owned by the Company. The net proceeds of
those sales may be used to reduce debt. Finally, once the integration of the
Acquisition is completed, annualized savings in selling, general and
administrative expenses are expected to reach $15 million, mostly from personnel
reductions, economies of scale, and operating efficiencies and synergies."
Zivi R. Nedivi, President and Chief Executive Officer of Kellstrom Industries,
stated, "The past year has been a trying time for our industry, particularly in
the fourth quarter. We've watched as competitors, facing severe financial
pressures, defaulted on loans, declared bankruptcy, and sold or closed
businesses and product lines. One consequence has been the disposal of inventory
at fire sale prices. This not only depressed industry-wide margins, but also
caused a general decline in after-market inventory values, which resulted in the
need to write-down certain items in our inventory. In a related move and in
keeping with our goal of shrinking the size of our lease portfolio, we
liquidated under-performing assets at lower prices than in the past, which on a
going forward basis should have a favorable impact on inventory turns. Over
time, we believe that the excess parts inventory in the aftermarket will dry up,
and Kellstrom will be one of the largest and strongest remaining players,
serving the global commercial and military aviation industry with nose-to-tail
inventory management solutions."
Mr. Nedivi concluded, "During the downturn in our industry, we established
Kellstrom as a premier nose-to-tale solutions provider and acquired additional
market share, but at the expense of profitability over the past six quarters.
Subject to aviation industry trends, as well as the overall economic outlook, we
estimate that it will take three to six quarters to achieve a sustainable
turnaround in our business. Specifically, we expect a first and second quarter
net loss, which will include exchange offer expenses as well as costs related to
severance and relocation to the Miramar facility. We are focused on integrating
the Acquisition, and believe that Kellstrom, with a unified, customer-focused
organization, superior quality assurance and an advanced information technology
capability, is positioned to be the leading independent inventory management
company in the aviation industry. Once the industry slump is behind us, we
expect to achieve the financial returns that our leadership position, resolve,
and resources afford us."
(more)
<PAGE> 5
Kellstrom Industries, Inc. Page 3
April 2, 2001
CONFERENCE CALL
Kellstrom's management will host a conference call at 3 pm. Eastern Daylight
Savings Time on Monday, April 2, 2001 to discuss fourth quarter and year-end
results. The conference call will be broadcast live over the Internet via the
Investor Relations section of the Company's web site at WWW.KELLSTROM.COM. To
listen to the live call, go to the web site at least 10 minutes early to
register, download and install any necessary audio software. If you are unable
to listen live, the conference call will be archived and can be accessed for
approximately 90 days.
Kellstrom Industries, Inc. is a leading aviation inventory management company
delivering innovative and value added nose-to-tail programs to the global
commercial and military aviation markets. The Company unites cutting edge
information technology, including e-commerce, with quality assurance
methodologies to provide engines and parts for large turbo-fan engines
manufactured by CFMI, General Electric, Pratt & Whitney and Rolls Royce, in
addition to a full complement of rotables and components for the commercial
aircraft they power. Kellstrom is also a premier inventory management and
components supplier of engines, components, systems and parts for large military
transport aircraft, jet fighters and helicopters. The Company is an approved
supplier to an international customer base including major domestic and
international airlines, military air forces, original equipment manufacturers
and engine overhaul shops.
<TABLE>
<CAPTION>
<S> <C>
CONTACT:
Kellstrom Industries, Inc. (954) 845-0427 KELL'S INVESTOR RELATIONS COUNSEL:
Zivi R. Nedivi, Pres. & CEO The Equity Group Inc.
Yoav Stern, Chairman of the Board Linda Latman (212) 836-9609
Oscar Torres, Chief Financial Officer Bob Goldstein (212) 371-8660
Michael Shokouhi, Director of Investor Relations www.theequitygroup.com
www.kellstrom.com ----------------------
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</TABLE>
(See Accompanying Tables)
<PAGE> 6
Kellstrom Industries, Inc. News Release Page 4
April 2, 2001
KELLSTROM INDUSTRIES, INC.
Consolidated Condensed Statements of Operations
(In thousands, except per share amount)
<TABLE>
<CAPTION>
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
--------------------------------------------------------------------------------
2000 1999 2000 1999
---------------- ---------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Sales of aircraft and engine parts, net $90,917 $83,274 $332,255 $288,912
Rental revenues 5,322 9,656 21,728 42,032
----- ----- ------ ------
Total revenues 96,239 92,930 353,983 330,944
Cost of goods sold (68,730) (60,982) (247,413) (200,889)
Cost of goods sold - inventory write-
down (45,469) (45,469) 0
Depreciation of equipment under operating
leases (3,851) (6,525) (18,070) (27,114)
Selling, general and administrative (14,087) (11,750) (49,241) (41,150)
Depreciation and amortization (2,042) (1,481) (6,859) (5,398)
Restructuring, impairment and other
charges (8,462) -- (8,462) (2,200)
------ ----- ------- -------
Total operating expenses (142,641) (80,738) (375,514) (276,751)
Operating (loss) income (46,402) 12,193 (21,531) 54,193
Interest expense, net of interest
income (7,220) (5,950) (26,380) (21,268)
------- ------- -------- --------
(Loss) income before income taxes and
extraordinary item (53,622) 6,243 (47,911) 32,925
Income tax benefit (expense) 20,067 (2,300) 17,930 (12,390)
------ ------- ------ --------
(Loss) income before
extraordinary item (33,555) 3,943 (29,981) 20,535
-------- ----------- -------- ------
Extraordinary loss on early
Extinguishments of debt, net of
$803 tax benefit (1,349) -- (1,349) --
------- ---------- ------- -----
(Loss) net income (34,904) $3,943 (31,330) $20,535
======== ====== ======== =======
(Loss) earnings before extraordinary
item per common share - basic $(2.82) $0.33 $(2.52) $1.73
(Loss) from extraordinary item per
common share - basic $(0.11) -- $(0.11) --
</TABLE>
<PAGE> 7
Kellstrom Industries, Inc. News Release Page 5
April 2, 2001
<TABLE>
<CAPTION>
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
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2000 1999 2000 1999
---------------- ---------------- ------------------- ----------------
<S> <C> <C> <C> <C>
(Loss) earnings per common
share - basic $(2.93) $0.33 $(2.63) $1.73
(Loss) earnings before extraordinary
item per common
share - diluted $(2.82) $0.31 $(2.52) $1.48
(Loss) from extraordinary item per
common share - diluted $(0.11) -- $(0.11) --
------- -- -- ------- ----
(Loss) earnings per common share -
diluted $(2.93) $0.31 $(2.63) $1.48
Weighted average number of common shares
outstanding - basic 11,911 11,911 11,911 11,855
Weighted average number of common shares
outstanding - diluted 11,911 16,679 11,911 16,674
</TABLE>
<PAGE> 8
Kellstrom Industries, Inc. News Release Page 6
April 2, 2001
KELLSTROM INDUSTRIES, INC.
Consolidated Balance Sheet Highlights
(In thousands)
<TABLE>
<CAPTION>
December 31, December 31,
2000 1999
--------------------- ------------------
<S> <C> <C>
Cash and cash equivalents $ 0 $ 272
Trade receivables, net 80,315 60,675
Inventories 195,640 194,491
Property and plant held for sale 19,932 --
Other current assets 17,888 13,479
------- -------
Total current assets 313,775 268,917
Notes Receivable 3,435 --
Equipment under operating leases, net 98,555 150,137
Property, plant & equipment, net 19,896 25,340
Intangible assets, net 95,766 87,825
Deferred tax asset 17,487 --
Other assets 12,617 9,226
------- --------
Total assets 561,531 $541,445
======= ========
Short-term debt 167,277 165,774
Accounts payable and accrued expenses 67,802 35,847
Current maturities of long-term debt 200 2,346
Capital lease obligation 9,597 --
------- -------
Total current liabilities 244,876 203,967
Long-term debt and other long-term liabilities 34,937 26,015
Convertible subordinated notes 140,250 140,250
------- -------
Total liabilities 420,063 370,232
Stockholders' equity 141,468 171,213
------- -------
Total liabilities and stockholders' equity 561,531 $541,445
======= ========
</TABLE>
THE COMPANY, FROM TIME TO TIME, MAY DISCUSS FORWARD-LOOKING INFORMATION. THIS
PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS, INCLUDING STATEMENTS
REGARDING THE COMPANY'S STRATEGIES, PLANS, OBJECTIVES AND EXPECTATIONS
CONCERNING THE COMPANY'S FUTURE MARKET POSITION, OPERATIONS, CASH FLOW, MARGINS,
REVENUE, EXPENSES, FUTURE PROFITABILITY, DECREASES IN DEBT, LIQUIDITY AND
CAPITAL RESOURCES. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON MANY
ASSUMPTIONS AND FACTORS, AND ARE SUBJECT TO MANY CONDITIONS, INCLUDING ADVERSE
CONSEQUENCES RELATING TO THE COMPANY'S SUBSTANTIAL DEBT, RESTRICTIONS ON THE
COMPANY'S BUSINESS AND OPERATIONS IMPOSED BY ITS SENIOR DEBT, THE COMPANY'S
ABILITY TO EFFECTIVELY INTEGRATE ACQUIRED COMPANIES, ACQUIRE ADEQUATE INVENTORY
AND TO OBTAIN FAVORABLE PRICING FOR SUCH INVENTORY, POSSIBLE WRITE-DOWNS OF THE
COMPANY'S INVENTORY, THE ABILITY TO ARRANGE FOR THE SERVICING OF THE COMPANY'S
INVENTORY BY THIRD-PARTY CONTRACTORS BEFORE RESALE OR LEASE, POSSIBLE PRODUCT
LIABILITY CLAIMS, CUSTOMER CONCENTRATION, COMPETITIVE PRICING FOR THE COMPANY'S
PRODUCTS AND FLUCTUATIONS IN DEMAND FOR THE COMPANY'S PRODUCTS WHICH DEPENDS
UPON THE CONDITION OF THE AIRLINE INDUSTRY. EXCEPT FOR THE HISTORICAL
INFORMATION CONTAINED IN THIS RELEASE, ALL FORWARD-LOOKING STATEMENTS ARE
ESTIMATES BY THE COMPANY'S MANAGEMENT AND ARE SUBJECT TO VARIOUS RISKS AND
UNCERTAINTIES THAT MAY BE BEYOND THE COMPANY'S CONTROL AND MAY CAUSE RESULTS TO
DIFFER FROM MANAGEMENT'S CURRENT EXPECTATIONS. CERTAIN OF THESE RISKS ARE
DESCRIBED IN THE COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION
(SEC), INCLUDING THE REGISTRATION STATEMENT ON FORM S-4 FILED ON MARCH 8, 2001.
COPIES OF THE COMPANY'S SEC FILINGS ARE AVAILABLE FROM THE SEC OR MAY BE
OBTAINED UPON REQUEST FROM THE COMPANY. THE COMPANY DOES NOT UNDERTAKE ANY
OBLIGATION TO UPDATE THE INFORMATION CONTAINED HEREIN, WHICH SPEAKS ONLY AS OF
THIS DATE.
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