0-24293
|
|
43-1309065
|
(Commission File Number)
|
|
(IRS Employer Identification No.)
|
|
|
|
411 Fountain Lakes Blvd., St. Charles, Missouri
|
|
63301
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
|
¨
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
¨
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
¨
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
¨
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
(d)
|
Exhibits. See the Exhibit Index which is hereby incorporated by reference.
|
|
|
LMI AEROSPACE, INC.
|
|
|
|
|
|
|
By:
|
/s/ Lawrence E. Dickinson
|
|
|
|
Lawrence E. Dickinson
|
|
|
|
Vice President, Chief Financial Officer and Secretary
|
|
|
|
|
|
Exhibit Number
|
Description
|
|
|
|
|
Text of earnings press release issued by the Company dated August 8, 2013
|
|
Contact:
Ed Dickinson
Chief Financial Officer, 636.916.2150
|
• | Growth in sales of the company’s legacy Aerostructures business of $9.2 million was partially offset by a reduction in sales of Engineering Services |
• | Firm backlog as of June 30, 2013, was $421.0 million |
• | Quarter includes an elimination of contingent consideration for potential earn-out payments of $8.0 million related to the Valent acquisition, but offset in part by a $4.2 million impairment of a 2007 intangible asset trade name in Engineering Services |
• | Guidance for 2013 revised. 2014 guidance expected to be issued in November 2013. |
|
Q2 2013
|
Per Diluted
Share |
||||||
|
||||||||
Net income
|
$
|
4,664
|
$
|
0.37
|
||||
Interest expense, net of tax
|
2,560
|
0.20
|
||||||
Intangible asset impairment, net of tax
|
2,673
|
0.21
|
||||||
Contingent consideration write-off, net of tax
|
(5,032
|
)
|
(0.40
|
)
|
||||
Cumulative catch-up adjustments, net of tax
|
728
|
0.06
|
||||||
Valent net income
|
(1,415
|
)
|
(0.11
|
)
|
||||
Net income excluding Valent, cumulative catch-up adjustments and non-recurring items
|
$
|
4,178
|
$
|
0.33
|
Net Sales
|
Q2
2013
|
%
of Total |
Valent
|
Legacy
|
%
of Total |
Q2
2012
|
%
of Total |
|||||||||||||||||||||
|
($ in millions)
|
|||||||||||||||||||||||||||
Large commercial aircraft
|
$
|
41.3
|
48.7
|
%
|
$
|
18.5
|
$
|
22.8
|
43.0
|
%
|
$
|
18.1
|
41.3
|
%
|
||||||||||||||
Corporate and regional aircraft
|
22.7
|
26.8
|
%
|
2.9
|
19.8
|
37.4
|
%
|
14.9
|
34.0
|
%
|
||||||||||||||||||
Military
|
14.0
|
16.5
|
%
|
5.1
|
8.9
|
16.8
|
%
|
8.4
|
19.2
|
%
|
||||||||||||||||||
Other
|
6.8
|
8.0
|
%
|
5.3
|
1.5
|
2.8
|
%
|
2.4
|
5.5
|
%
|
||||||||||||||||||
Total
|
$
|
84.8
|
100.0
|
%
|
$
|
31.8
|
$
|
53.0
|
100.0
|
%
|
$
|
43.8
|
100.0
|
%
|
Net Sales
|
Q2
2013
|
%
of Total |
Q2
2012
|
%
of Total |
||||||||||||
|
($ in millions)
|
|||||||||||||||
Large commercial aircraft
|
$
|
9.0
|
41.9
|
%
|
$
|
6.8
|
26.1
|
%
|
||||||||
Corporate and regional aircraft
|
4.4
|
20.4
|
%
|
8.5
|
32.6
|
%
|
||||||||||
Military
|
4.6
|
21.4
|
%
|
9.2
|
35.2
|
%
|
||||||||||
Other
|
3.5
|
16.3
|
%
|
1.6
|
6.1
|
%
|
||||||||||
Total
|
$
|
21.5
|
100.0
|
%
|
$
|
26.1
|
100.0
|
%
|
• | Net sales between $433.0 million and $445.0 million |
• | Gross profit between 20.6 percent and 21.0 percent |
• | SG&A between $53.4 million and $55.0 million |
• | Interest and other expenses between $16.1 million and $17.1 million |
• | Effective income tax rate between 35.0 percent and 35.5 percent |
• | Capital expenditures between $27.0 million and $30.0 million |
• | Depreciation, amortization, trade name impairment and stock compensation expenses between $26.0 million and $27.1 million |
• | Net sales between $346.0 million and $354.0 million, including between $130.0 million and $134.0 million for Valent |
• | Gross profit between 21.9 percent and 22.3 percent, including a one time $2.5 million charge representing the Valent inventory step-up |
• | SG&A between $37.7 million and $38.9 million, including the contingent consideration elimination of $8.0 million |
• | Net sales between $87.0 million and $91.0 million |
• | Gross profit between 15.4 percent and 15.9 percent |
• | SG&A between $15.7 million and $16.1 million, including the trade name impairment of $4.2 million |
|
Consolidated ($ in millions)
|
|||
Operating income
|
35.9 - 38.6
|
|||
Depreciation, amortization and stock based compensation
|
21.7 - 22.8
|
|||
Contingent consideration write-off
|
(8.0) - (8.0)
|
|||
Intangible asset impairment
|
4.2 - 4.2
|
|||
Step-up in inventory to cost of goods sold
|
2.5 - 2.5
|
|||
Acquisition and integration expense
|
1.6 - 1.6
|
|||
|
57.9 – 61.7
|
June 30,
|
December 31,
|
|||||||
|
2013
|
2012
|
||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
2,554
|
$
|
4,347
|
||||
Accounts receivable, net
|
87,024
|
69,159
|
||||||
Inventories
|
104,900
|
90,039
|
||||||
Prepaid expenses and other current assets
|
6,541
|
5,655
|
||||||
Deferred income taxes
|
3,725
|
3,839
|
||||||
Total current assets
|
204,744
|
173,039
|
||||||
|
||||||||
Property, plant and equipment, net
|
105,889
|
96,218
|
||||||
Goodwill
|
180,933
|
179,314
|
||||||
Intangible assets, net
|
57,789
|
64,334
|
||||||
Other assets
|
13,514
|
15,059
|
||||||
Total assets
|
$
|
562,869
|
$
|
527,964
|
||||
|
||||||||
Liabilities and shareholders’ equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
26,431
|
$
|
30,471
|
||||
Accrued expenses
|
18,129
|
23,703
|
||||||
Current installments of long-term debt and capital lease obligations
|
6,561
|
5,632
|
||||||
Total current liabilities
|
51,121
|
59,806
|
||||||
|
||||||||
Long-term liabilities:
|
||||||||
Long-term debt and capital lease obligations, less current installments
|
286,309
|
255,067
|
||||||
Other long-term liabilities
|
3,288
|
3,405
|
||||||
Deferred income taxes
|
13,167
|
8,732
|
||||||
Total long-term liabilities
|
302,764
|
267,204
|
||||||
|
||||||||
Shareholders’ equity:
|
||||||||
Common stock, $0.02 par value per share; authorized 28,000,000 shares; issued 12,858,641 and 12,860,023 shares at June 30, 2013 and December 31, 2012, respectively
|
257
|
257
|
||||||
Preferred stock, $0.02 par value per share; authorized 2,000,000 shares; none issued at either date
|
-
|
-
|
||||||
Additional paid-in capital
|
92,113
|
90,839
|
||||||
Accumulated other comprehensive loss
|
(196
|
)
|
(49
|
)
|
||||
Treasury stock, at cost, 14,354 shares at June 30, 2013 and 101,622 shares at December 31, 2012
|
(80
|
)
|
(482
|
)
|
||||
Retained earnings
|
116,890
|
110,389
|
||||||
Total shareholders’ equity
|
208,984
|
200,954
|
||||||
Total liabilities and shareholders’ equity
|
$
|
562,869
|
$
|
527,964
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
|
||||||||||||||||
Sales and service revenue
|
||||||||||||||||
Product sales
|
$
|
83,153 |
$
|
42,221
|
$
|
165,267
|
$
|
82,386
|
||||||||
Service revenue
|
22,312
|
27,106
|
46,264
|
53,690
|
||||||||||||
Net sales
|
105,465
|
69,327
|
211,531
|
136,076
|
||||||||||||
Cost of sales and service revenue
|
||||||||||||||||
Cost of product sales
|
63,592
|
29,189
|
128,730
|
56,574
|
||||||||||||
Cost of service revenue
|
20,032
|
23,171
|
40,906
|
46,017
|
||||||||||||
Cost of sales
|
83,624
|
52,360
|
169,636
|
102,591
|
||||||||||||
Gross profit
|
21,841
|
16,967
|
41,895
|
33,485
|
||||||||||||
|
||||||||||||||||
Selling, general and administrative expenses
|
14,098
|
8,881
|
28,079
|
17,961
|
||||||||||||
Contingent consideration write-off
|
(7,950
|
)
|
-
|
(7,950
|
)
|
-
|
||||||||||
Intangible asset impairment
|
4,222
|
-
|
4,222
|
-
|
||||||||||||
Income from operations
|
11,471
|
8,086
|
17,544
|
15,524
|
||||||||||||
|
||||||||||||||||
Other income (expense):
|
||||||||||||||||
Interest expense
|
(4,044
|
)
|
(293
|
)
|
(8,157
|
)
|
(494
|
)
|
||||||||
Other, net
|
(80
|
)
|
(62
|
)
|
400
|
107
|
||||||||||
Total other expense
|
(4,124
|
)
|
(355
|
)
|
(7,757
|
)
|
(387
|
)
|
||||||||
|
||||||||||||||||
Income before income taxes
|
7,347
|
7,731
|
9,787
|
15,137
|
||||||||||||
Provision for income taxes
|
2,683
|
2,626
|
3,286
|
5,240
|
||||||||||||
|
||||||||||||||||
Net income
|
4,664
|
5,105
|
6,501
|
9,897
|
||||||||||||
Other comprehensive income (expense):
|
||||||||||||||||
Change in foreign currency translation adjustment
|
(15
|
)
|
-
|
(137
|
)
|
-
|
||||||||||
Unrealized gain (loss) on interest rate hedges net of tax
|
151
|
-
|
(10
|
)
|
-
|
|||||||||||
Other comprehensive income (expense)
|
136
|
-
|
(147
|
)
|
-
|
|||||||||||
Total comprehensive income
|
$
|
4,800
|
$
|
5,105
|
$
|
6,354
|
$
|
9,897
|
||||||||
|
||||||||||||||||
Amounts per common share:
|
||||||||||||||||
Net income per common share
|
$
|
0.37
|
$
|
0.44
|
$
|
0.52
|
$
|
0.85
|
||||||||
|
||||||||||||||||
Net income per common share assuming dilution
|
$
|
0.37
|
$
|
0.43
|
$
|
0.51
|
$
|
0.84
|
||||||||
|
||||||||||||||||
Weighted average common shares outstanding
|
12,612,389
|
11,671,388
|
12,597,381
|
11,644,698
|
||||||||||||
|
||||||||||||||||
Weighted average dilutive common shares outstanding
|
12,720,372
|
11,833,503
|
12,697,947
|
11,809,972
|
|
Six Months Ended
|
|||||||
|
June 30,
|
|||||||
|
2013
|
2012
|
||||||
Operating activities:
|
||||||||
Net income
|
$
|
6,501
|
$
|
9,897
|
||||
Adjustments to reconcile net income to net cash (used) provided by operating activities:
|
||||||||
Depreciation and amortization
|
9,734
|
3,813
|
||||||
Contingent consideration write-off
|
(7,950
|
)
|
-
|
|||||
Deferred taxes
|
2,915
|
(1,140
|
)
|
|||||
Intangible asset impairment
|
4,222
|
-
|
||||||
Restricted stock compensation
|
753
|
743
|
||||||
Other noncash items
|
(174
|
)
|
(135
|
)
|
||||
Changes in operating assets and liabilities, net of acquired businesses:
|
||||||||
Accounts receivable
|
(17,614
|
)
|
(6,437
|
)
|
||||
Inventories
|
(14,691
|
)
|
(5,365
|
)
|
||||
Prepaid expenses and other assets
|
(263
|
)
|
(207
|
)
|
||||
Current income taxes
|
545
|
2,393
|
||||||
Accounts payable
|
(4,580
|
)
|
(1,673
|
)
|
||||
Accrued expenses
|
3,033
|
2,060
|
||||||
Net cash (used) provided by operating activities
|
(17,569
|
)
|
3,949
|
|||||
Investing activities:
|
||||||||
Additions to property, plant and equipment
|
(17,873
|
)
|
(6,345
|
)
|
||||
Proceeds from sales of equipment
|
1,880
|
38
|
||||||
Net cash used by investing activities
|
(15,993
|
)
|
(6,307
|
)
|
||||
Financing activities:
|
||||||||
Proceeds from issuance of debt
|
6,136
|
997
|
||||||
Principal payments on long-term debt and notes payable
|
(2,376
|
)
|
(40
|
)
|
||||
Advances on revolving line of credit
|
69,500
|
-
|
||||||
Payments on revolving line of credit
|
(41,500
|
)
|
-
|
|||||
Other, net
|
9
|
173
|
||||||
Net cash provided by financing activities
|
31,769
|
1,130
|
||||||
Net decrease in cash and cash equivalents
|
(1,793
|
)
|
(1,228
|
)
|
||||
Cash and cash equivalents, beginning of period
|
4,347
|
7,868
|
||||||
Cash and cash equivalents, end of period
|
$
|
2,554
|
$
|
6,640
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
|
2013
|
2012
|
2013
|
2012
|
||||||||||||
Non-GAAP Financial Information
|
||||||||||||||||
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)(1):
|
||||||||||||||||
|
||||||||||||||||
Net Income
|
$
|
4,664
|
$
|
5,105
|
$
|
6,501
|
$
|
9,897
|
||||||||
|
||||||||||||||||
Depreciation and amortization
|
4,943
|
1,877
|
9,734
|
3,813
|
||||||||||||
Interest expense
|
4,044
|
293
|
8,157
|
494
|
||||||||||||
Income tax expense
|
2,683
|
2,626
|
3,286
|
5,240
|
||||||||||||
Stock based compensation
|
393
|
368
|
753
|
743
|
||||||||||||
Acquisition and integration expenses
|
187
|
-
|
762
|
-
|
||||||||||||
Intangible asset impairment
|
4,222
|
-
|
4,222
|
-
|
||||||||||||
Contingent consideration write-off
|
(7,950
|
)
|
-
|
(7,950
|
)
|
-
|
||||||||||
Fair value step-up on acquired inventories
|
-
|
-
|
2,497
|
-
|
||||||||||||
Other, net
|
80
|
62
|
(400
|
)
|
(107
|
)
|
||||||||||
|
||||||||||||||||
Adjusted EBITDA
|
$
|
13,266
|
$
|
10,331
|
$
|
27,562
|
$
|
20,080
|
||||||||
|
||||||||||||||||
Free Cash Flow (2):
|
||||||||||||||||
|
||||||||||||||||
Net cash (used) provided by operating activities
|
$
|
(7,107
|
)
|
$
|
3,521
|
$
|
(17,569
|
)
|
$
|
3,949
|
||||||
Less capital expenditures
|
(5,281
|
)
|
(3,436
|
)
|
(17,873
|
)
|
(6,345
|
)
|
||||||||
|
||||||||||||||||
Free cash flow
|
$
|
(12,388
|
)
|
$
|
85
|
$
|
(35,442
|
)
|
$
|
(2,396
|
)
|