UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 28, 2013
or
o |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number: 1-8183
SUPREME INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware |
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75-1670945 |
(State or other jurisdiction of |
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(I.R.S. Employer Identification No.) |
2581 E. Kercher Rd., Goshen, Indiana 46528 |
(Address of principal executive offices) (Zip Code) |
Registrants telephone number, including area code: (574) 642-3070
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer o |
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Accelerated filer o |
Non-accelerated filer o |
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Smaller reporting company x |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.
Common Stock ($.10 Par Value) |
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Outstanding at October 22, 2013 |
Class A |
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14,522,675 |
Class B |
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1,771,949 |
SUPREME INDUSTRIES, INC.
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Managements Discussion and Analysis of Financial Condition and Results of Operations. |
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Unregistered Sales of Equity Securities and Use of Proceeds. |
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EXHIBITS |
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SUPREME INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
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September 28, |
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December 29, |
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2013 |
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2012 |
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(Unaudited) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
19,838 |
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$ |
59,056 |
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Investments |
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2,866,350 |
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2,887,172 |
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Accounts receivable, net |
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23,143,545 |
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18,781,735 |
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Inventories |
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36,983,687 |
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32,308,931 |
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Deferred income taxes |
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2,025,718 |
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2,298,181 |
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Other current assets |
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4,574,635 |
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4,672,211 |
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Total current assets |
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69,613,773 |
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61,007,286 |
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Property, plant and equipment, at cost |
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94,573,923 |
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92,795,659 |
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Less, Accumulated depreciation and amortization |
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49,840,247 |
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49,857,671 |
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Property, plant and equipment, net |
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44,733,676 |
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42,937,988 |
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Other assets |
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1,295,885 |
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1,142,809 |
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Total assets |
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$ |
115,643,334 |
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$ |
105,088,083 |
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LIABILITIES AND STOCKHOLDERS EQUITY |
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Current liabilities: |
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Current maturities of long-term debt |
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$ |
666,668 |
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$ |
16,934 |
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Trade accounts payable |
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15,059,061 |
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11,936,544 |
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Other accrued liabilities |
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11,037,225 |
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10,409,930 |
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Total current liabilities |
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26,762,954 |
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22,363,408 |
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Long-term debt |
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15,089,171 |
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14,089,063 |
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Deferred income taxes |
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1,430,729 |
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1,472,730 |
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Other long-term liabilities |
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50,048 |
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Total liabilities |
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43,332,902 |
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37,925,201 |
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Stockholders equity |
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72,310,432 |
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67,162,882 |
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Total liabilities and stockholders equity |
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$ |
115,643,334 |
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$ |
105,088,083 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
SUPREME INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME (UNAUDITED)
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Three Months Ended |
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Nine Months Ended |
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September 28, |
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September 29, |
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September 28, |
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September 29, |
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2013 |
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2012 |
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2013 |
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2012 |
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Net sales |
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$ |
67,310,853 |
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$ |
71,671,126 |
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$ |
209,738,971 |
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$ |
228,411,988 |
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Cost of sales |
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56,629,738 |
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60,097,281 |
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174,045,648 |
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192,508,241 |
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Gross profit |
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10,681,115 |
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11,573,845 |
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35,693,323 |
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35,903,747 |
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Selling, general and administrative expenses |
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8,354,912 |
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7,570,491 |
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25,507,577 |
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24,231,123 |
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Legal settlement and related costs |
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328,415 |
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3,600,161 |
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455,415 |
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Other income |
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(94,227 |
) |
(174,445 |
) |
(827,008 |
) |
(766,585 |
) | ||||
Operating income |
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2,420,430 |
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3,849,384 |
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7,412,593 |
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11,983,794 |
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Interest expense |
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315,963 |
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149,710 |
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537,354 |
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729,520 |
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Income before income taxes |
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2,104,467 |
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3,699,674 |
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6,875,239 |
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11,254,274 |
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Income tax expense (benefit) |
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573,030 |
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129,183 |
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2,114,865 |
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(195,134 |
) | ||||
Net income |
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1,531,437 |
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3,570,491 |
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4,760,374 |
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11,449,408 |
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Other comprehensive income (loss) |
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(31,265 |
) |
1,814 |
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(62,534 |
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2,561 |
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Total comprehensive income |
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$ |
1,500,172 |
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$ |
3,572,305 |
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$ |
4,697,840 |
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$ |
11,451,969 |
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Income per share: |
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Basic |
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$ |
0.09 |
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$ |
0.22 |
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$ |
0.30 |
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$ |
0.72 |
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Diluted |
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0.09 |
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0.22 |
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0.29 |
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0.71 |
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Shares used in the computation of income per share: |
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Basic |
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16,160,518 |
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15,966,506 |
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16,087,864 |
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15,945,830 |
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Diluted |
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16,546,113 |
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16,243,852 |
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16,425,542 |
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16,209,108 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
SUPREME INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
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Nine Months Ended |
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September 28, |
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September 29, |
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2013 |
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2012 |
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Cash flows from operating activities: |
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Net income |
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$ |
4,760,374 |
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$ |
11,449,408 |
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Adjustments to reconcile net income to net cash from operating activities: |
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Depreciation and amortization |
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2,657,081 |
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2,363,367 |
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Provision for losses on doubtful receivables |
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77,278 |
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30,034 |
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Deferred income taxes |
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230,462 |
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(817,134 |
) | ||
Stock-based compensation expense |
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313,563 |
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216,834 |
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Gains on sale of property, plant and equipment, net |
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(352,893 |
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(362,098 |
) | ||
Changes in operating assets and liabilities |
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(5,382,460 |
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(4,935,149 |
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Net cash provided by operating activities |
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2,303,405 |
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7,945,262 |
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Cash flows from investing activities: |
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Additions to property, plant and equipment |
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(5,042,419 |
) |
(5,354,288 |
) | ||
Proceeds from sale of property, plant and equipment |
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1,251,959 |
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4,213,153 |
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Purchases of investments |
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(20,824 |
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(11,635 |
) | ||
Proceeds from sale of investments |
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41,646 |
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Decrease in other assets |
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129,878 |
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Net cash used in investing activities |
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(3,769,638 |
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(1,022,892 |
) | ||
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Cash flows from financing activities: |
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Proceeds from revolving line of credit and other long-term debt |
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59,583,131 |
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226,248,425 |
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Repayments of revolving line of credit and other long-term debt |
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(57,933,289 |
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(229,906,247 |
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Payment of debt issuance costs |
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(358,975 |
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Proceeds from exercise of stock options |
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136,148 |
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88,515 |
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Net cash provided by (used in) financing activities |
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1,427,015 |
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(3,569,307 |
) | ||
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Change in cash and cash equivalents |
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(39,218 |
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3,353,063 |
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Cash and cash equivalents, beginning of period |
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59,056 |
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106,833 |
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Cash and cash equivalents, end of period |
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$ |
19,838 |
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$ |
3,459,896 |
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See accompanying Notes to Condensed Consolidated Financial Statements.
SUPREME INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 BASIS OF PRESENTATION AND OPINION OF MANAGEMENT
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all of the information and financial statement disclosures necessary for a fair presentation of consolidated financial position, results of operations, and cash flows in conformity with accounting principles generally accepted in the United States of America. In the opinion of management, the information furnished herein includes all adjustments necessary to reflect a fair presentation of the interim periods reported. The December 29, 2012 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. References to we, us, our, its, Supreme, or the Company refer to Supreme Industries, Inc. and its subsidiaries.
The Company has adopted a 52- or 53-week fiscal year ending the last Saturday in December. The results of operations for the three and nine months ended September 28, 2013 and September 29, 2012 are for 13-week and 39-week periods, respectively.
Stock Dividend
On May 8, 2013, the Companys Board of Directors declared a five percent (5%) stock dividend on its outstanding Class A and Class B Common Stock. Stockholders of record on May 20, 2013 received a stock dividend for each share owned on that date, paid on June 3, 2013. All share and per share data have been adjusted to reflect the stock dividend on a retroactive basis.
Reclassification
Certain amounts in the prior year unaudited condensed consolidated financial statements have been reclassified to conform with the current year presentation. These reclassifications had no effect on net income, stockholders equity, or total assets as previously reported.
NOTE 2 INVENTORIES
Inventories, which are stated at the lower of cost or market with cost determined using the first-in, first-out method, consist of the following:
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September 28, |
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December 29, |
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2013 |
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2012 |
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Raw materials |
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$ |
23,284,651 |
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$ |
21,557,053 |
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Work-in-progress |
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4,741,838 |
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3,654,801 |
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Finished goods |
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8,957,198 |
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7,097,077 |
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$ |
36,983,687 |
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$ |
32,308,931 |
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NOTE 3 OTHER CURRENT ASSETS
Other current assets include assets held for sale of $2.0 million and $2.1 million at September 28, 2013 and December 29, 2012, respectively. During the first quarter of 2013, the Company realized a gain of approximately $0.4 million on the sale of real estate. Additionally, during the third quarter of 2013, the Company reclassified approximately $0.7 million of real estate from property, plant, and equipment to assets held for sale.
NOTE 4 FAIR VALUE MEASUREMENT
Generally accepted accounting principles (GAAP) define fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. GAAP also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:
Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
Level 2: Significant other observable inputs (other than Level 1 prices such as quoted prices for similar assets or liabilities); quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
Level 3: Significant unobservable inputs that reflect a companys own assumptions about the assumptions that market participants would use in pricing an asset or liability.
The Company used the following methods and significant assumptions to estimate the fair value of items:
Investments: The fair values of investments available-for-sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs).
Derivatives: Our derivative instruments consist of interest rate swaps, currently reflected as other long-term liabilities on the Consolidated Condensed Balance Sheets. The Company obtains fair values from financial institutions that utilize internal models with observable market data inputs to estimate the fair value of these instruments (Level 2 inputs).
The carrying amounts of cash and cash equivalents, accounts receivable, and trade accounts payable approximated fair value as of September 28, 2013, and December 29, 2012, because of the relatively short maturities of these financial instruments. The carrying amount of long-term debt, including current maturities, approximated fair value as of September 28, 2013, and December 29, 2012, based upon terms and conditions available to the Company at those dates in comparison to the terms and conditions of its outstanding long-term debt.
NOTE 5 LONG-TERM DEBT
Credit Agreement
On December 19, 2012, the Company entered into an Amended and Restated Credit Agreement (the Credit Agreement) with Wells Fargo Bank (the Lender). Under the terms of the Credit Agreement, Lender agrees to provide to the Company a credit facility of up to $45.0 million, consisting of a revolving credit facility, a term loan facility, and a letter of credit facility. The Credit Agreement is for a period of five years ending on December 19, 2017. The Company had unused credit capacity of $25.4 million at September 28, 2013. Interest on outstanding borrowings under the Credit Agreement is based on the Lenders prime rate or LIBOR depending on the pricing option selected and the Companys leverage ratio (as defined in the Credit Agreement) resulting in an effective interest rate of 2.53% at September 28, 2013.
Revolving Credit Facility
The revolving credit facility provides for borrowings of up to $35.0 million. The Companys cash management system and revolving credit facility are designed to maintain zero cash balances and, accordingly, checks outstanding in excess of bank balances are classified as borrowings under the revolving credit facility. Checks outstanding in excess of bank balances were $2.3 million and additional borrowings against the revolving credit facility totaled $3.6 million at September 28, 2013. The revolving credit facility also requires a quarterly commitment fee ranging from 0.20% to 0.50% per annum depending on the Companys financial ratios and based upon the average daily unused portion.
Term Loan Facility
The term loan facility provides for borrowings of up to $10.0 million. Effective April 29, 2013, the Company and the Lender entered into a $10.0 million term loan. The term loan is secured by real estate and improvements, payable in quarterly installments of $166,667 commencing on June 28, 2013, plus interest at the Lenders prime rate or LIBOR (as defined in the Credit Agreement), through maturity on December 19, 2017. As of September 28, 2013, the outstanding balance under the term loan facility was $9.8 million.
On August 9, 2013, the Company entered into an interest rate swap agreement for a portion of the term loan with a notional amount of $5.0 million. The interest rate swap agreement provides for a 3.1% fixed interest rate and matures on December 19, 2017. The Company designated this swap agreement as a cash flow hedge on its variable rate debt and will record the fair value of the swap agreement as an asset or liability on the balance sheet, with changes in fair value recognized in other comprehensive income (loss).
Letter of Credit Facility
Outstanding letters of credit, related to the Companys workers compensation insurance policies, reduce available borrowings under the Credit Agreement and aggregated $3.7 million at September 28, 2013.
NOTE 6 STOCK-BASED COMPENSATION
The following table summarizes the activity for the unvested restricted stock for the nine months ended September 28, 2013:
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Weighted - |
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Average |
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Grant Date |
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Shares |
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Fair Value |
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Unvested, December 29, 2012 |
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$ |
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Granted |
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139,581 |
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4.17 |
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Vested |
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(22,836 |
) |
4.01 |
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Unvested, September 28, 2013 |
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116,745 |
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4.19 |
| |
The total fair value of shares vested during the nine months ended September 28, 2013 was $93,515.
A summary of the status of the Companys outstanding stock options as of September 28, 2013, and changes during the nine months ended September 28, 2013 are as follows:
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Weighted - |
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Average |
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Number of |
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Exercise |
| |
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Shares |
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Price |
| |
Outstanding, December 29, 2012 |
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1,007,798 |
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$ |
3.74 |
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Granted |
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| |
Exercised |
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(111,995 |
) |
1.89 |
| |
Expired |
|
(272,462 |
) |
6.29 |
| |
Forfeited |
|
(84,015 |
) |
4.29 |
| |
Outstanding, September 28, 2013 |
|
539,326 |
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|
2.78 |
|
As of September 28, 2013, outstanding exercisable options had an intrinsic value of $1,595,848 and a weighted-average remaining contractual life of 2.7 years.
Total unrecognized compensation expense related to all share-based awards outstanding at September 28, 2013, was $489,133 and will be recorded over a weighted average contractual life of 2.5 years.
NOTE 7 INCOME TAXES
For the three and nine months ended September 28, 2013, the Company recorded income tax expense of $0.6 million and $2.1 million, respectively, at an effective tax rate of 27.2% and 30.8%, respectively, which differed from the federal statutory rate primarily because of state income tax and federal permanent income tax differences. For the three and nine months ended September 29, 2012, the Company recorded income tax expense of $0.1 million and an income tax benefit of $0.2 million, respectively, resulting from the reversal of a deferred tax valuation allowance due to improved profitability during that period.
NOTE 8 COMMITMENTS AND CONTINGENCIES
In October of 2011, the Company was named a defendant in a personal injury suit (Paul Gendrolis and Katherine Gendrolis v. Saxon Fleet Sales, Kolstad Company, and Supreme Industries, Inc.) which was filed in the United States District Court, District of Massachusetts. The complaint sought $10 million in damages based on allegations that a truck body manufactured by the Company contained an improperly installed plate or lip, which caused Mr. Gendrolis to trip and become injured. Claims alleged against the Company included negligence, breach of warranty, breach of consumer protection laws, and loss of consortium. In September 2013, the parties mediated and reached a settlement to this litigation. The Companys contribution to the settlement was the remainder of its self-insurance deductible, in the amount of $0.1 million. The remainder of the settlement above was paid by insurance.
In February of 2012, the Company was named a defendant in a claim that a fleet of buses manufactured by the Company was defective (King County v. Supreme Corporation) which was filed in Superior Court in King County, Washington. King County sought to revoke its acceptance of a fleet of thirty-five buses which had been manufactured by the Company and sold to King County, and alleged breach of contract and breach of implied warranties. As of February 28, 2013, King County claimed its damages were $10.6 million and subsequently moved to add a consumer protection act claim which would have permitted an award of attorneys fees, if successful. On June 14, 2013, the Company and King County entered into a Settlement and Release Agreement under the terms of which the lawsuit would be dismissed and mutual releases granted in exchange for payment of the sum of $4.7 million to King County within ninety days of the date of the agreement and the return of thirty-five buses to the Company. Through separate agreements, the Company settled third-party claims against certain third-party subcontractors who have contributed to the Company $520,000 of the settlement funds, with the Company responsible for the balance which was paid on September 9, 2013. The Company assigned an estimated $1.1 million to the returned product. Including the legal settlement and related costs, the Company recorded a pre-tax charge of $3.6 million for the first nine months of 2013.
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Company Overview
Established in 1974 as a truck body manufacturer, Supreme Industries, Inc., through its wholly-owned subsidiary, Supreme Corporation, is one of the nations leading manufacturers of specialized vehicles. The Company engages principally in the production and sale of customized truck bodies, buses, and other specialty vehicles. Building on its expertise in providing both cargo and passenger transportation solutions, the Companys specialty vehicle offerings include products such as customized specialty vehicles and law enforcement vehicles.
The Companys transportation equipment products are used by a wide variety of industrial, commercial, governmental and law enforcement customers. The Company utilizes a nationwide direct sales and distribution network consisting of approximately 1,000 commercial truck dealers, a limited number of truck equipment distributors, and approximately 25 bus distributors. The Companys manufacturing and service facilities are located in seven states across the continental United States allowing us to meet the needs of customers across all of North America. Additionally, the Companys favorable customer relations, strong brand-name recognition, extensive product offerings, bailment chassis arrangements, and product innovation competitively position Supreme with a strategic footprint in the markets it serves.
The Company and its product offerings are affected by various risk factors which include, but are not limited to, economic conditions, interest rate fluctuations, volatility in the supply chain of chassis, and the availability of credit and financing to the Company, our vendors, dealers, or end users. The Companys business is also affected by the availability and costs of certain raw materials that serve as significant components of its product offerings. The Companys risk factors are disclosed in Item 1A Risk Factors in the Companys Annual Report on Form 10-K for the year ended December 29, 2012.
Results of Operations
The following discussion should be read in conjunction with the condensed consolidated financial statements and related notes (See Note 1 Basis of Presentation and Opinion of Management) thereto elsewhere in this document. All earnings per share and share figures have been adjusted for the 5% stock dividend paid in the second quarter of 2013.
Overview
During the third quarter of 2013, we recorded strong order intake led by significant fleet business and improved retail demand for the Companys truck bodies. Backlog at the end of the quarter increased 36% to $85.6 million, compared with $63.0 million at the end of last years third quarter. Consolidated net sales for the three and nine months ended September 28, 2013 declined 6.1% and 8.2%, respectively, compared with the prior periods. The revenue decrease was attributable to lower sales volume in the bus and specialty vehicle divisions and fleet sales.
For the first nine months of 2013, the Company continued to maintain its margin disciplines with the gross margin percentage increasing to 17.0% compared with 15.7% last year, despite the lower revenue. The margin percentage improvement was the result of initiatives to enhance manufacturing efficiencies, process improvements and strategic material procurement.
During the second quarter of 2013, Supreme settled its King County, Washington lawsuit which resulted in a year-to-date pre-tax charge of $3.6 million including related legal costs. The legal settlement and related costs for the nine months ended September 28, 2013 totaled $4.7 million, partially offset by $1.1 million of estimated value assigned to the returned product. Due to the inherent risk of litigation and the uncertainty of the outcome, the Company determined that it was in its best interest to bring this matter to resolution and therefore agreed to a settlement.
Net income for the three months ended September 28, 2013 was $1.5 million, or $0.09 per diluted share, compared with net income of $3.6 million, or $0.22 per diluted share for the comparable period last year. Net income for the first nine months ended September 28, 2013 was $4.8 million, or $0.29 per diluted share, compared with $11.4 million, or $0.71 per diluted share, last year.
On a pro forma basis, diluted earnings per share, adjusting for the King County legal settlement costs and normalizing of the 2012 income tax expense resulted in $0.09 per diluted share in the third quarter and $0.44 per diluted share in the first nine months of 2013 compared with $0.17 per diluted share and $0.50 per diluted share, respectively, last year. See Basic and diluted income per share for a more detailed explanation regarding the reconciliation of net income and net income per share to adjusted net income and adjusted net income diluted per share.
To support future sales volume, reflected in the higher backlog, working capital increased to $42.9 million at September 28, 2013, compared with $38.6 million at December 29, 2012. Higher working capital, combined with the $4.2 million payment for the legal settlement in September 2013, resulted in total debt increasing $1.7 million to $15.8 million at quarter end, versus $14.1 million at December 29, 2012, and $12.3 million at September 29, 2012. Stockholders equity increased to $72.3 million at September 28, 2013, compared with $67.2 million at December 29, 2012. Book value, on a per-share basis, was $4.48 at quarter end versus $4.20 at the end of last year.
During the first nine months of 2013, we continued to focus on improving our gross margin percentage through leveraging inputs and manufacturing efficiencies. As we continue to manage the Company for profitable growth, our key areas of ongoing focus include:
· Segmenting our product flow to allow for improved delivery of complex, high option products utilizing production processes dedicated to lower volume custom trucks. This also enhances our ability to increase the conversion velocity of our higher volume products;
· Improved delivery performance and compression of our overall order to cash lead-times;
· Continuing to focus on our facilities to further drive productivity gains;
· Strategically driving top-line growth;
· Continuing our product development initiatives related to both new and existing products; and
· Ongoing product line rationalization to improve gross margins and remain focused on our core truck, bus, and specialty products.
As we enter the last quarter of 2013, we are very encouraged by our backlog and recent demand trends in the truck division. We are continuing to implement initiatives targeted to benefit and leverage the strong foundation built to make further improvements in our future financial performance.
Net Sales
Net sales for the three months ended September 28, 2013 decreased $4.4 million, or 6.1%, to $67.3 million as compared with $71.7 million for the three months ended September 29, 2012. Net sales for the nine months ended September 28, 2013 decreased $18.7 million, or 8.2%, to $209.7 million as compared with $228.4 million for the nine months ended September 29, 2012. The following table presents the components of net sales and the changes from period to period:
|
|
Three Months Ended |
|
Nine Months Ended |
| ||||||||||||||||||
($000s omitted) |
|
Sep 28, |
|
Sep 29, |
|
Change |
|
Sep 28, |
|
Sep 29, |
|
Change |
| ||||||||||
Specialized vehicles: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Trucks |
|
$ |
52,418 |
|
$ |
54,216 |
|
$ |
(1,798 |
) |
(3.3 |
)% |
$ |
165,626 |
|
$ |
170,984 |
|
$ |
(5,358 |
) |
(3.1 |
)% |
Buses |
|
12,355 |
|
12,705 |
|
(350 |
) |
(2.8 |
) |
33,360 |
|
44,474 |
|
(11,114 |
) |
(25.0 |
) | ||||||
Specialty vehicles |
|
2,145 |
|
4,050 |
|
(1,905 |
) |
(47.0 |
) |
9,074 |
|
10,740 |
|
(1,666 |
) |
(15.5 |
) | ||||||
|
|
66,918 |
|
70,971 |
|
(4,053 |
) |
(5.7 |
) |
208,060 |
|
226,198 |
|
(18,138 |
) |
(8.0 |
) | ||||||
Fiberglass products |
|
393 |
|
700 |
|
(307 |
) |
(43.9 |
) |
1,679 |
|
2,214 |
|
(535 |
) |
(24.2 |
) | ||||||
|
|
$ |
67,311 |
|
$ |
71,671 |
|
$ |
(4,360 |
) |
(6.1 |
)% |
$ |
209,739 |
|
$ |
228,412 |
|
$ |
(18,673 |
) |
(8.2 |
)% |
Truck division sales decreased by $1.8 million, or 3.3%, for the three months ended September 28, 2013, and decreased by $5.4 million, or 3.1%, for the nine months ended September 28, 2013. The decreases were due to fewer orders from fleet customers, partially offset by higher retail truck sales during the first nine months of the year.
Bus division sales decreased by $0.4 million, or 2.8%, for the three months ended September 28, 2013, and decreased by $11.1 million, or 25.0%, for the nine months ended September 29, 2013. The decrease was the result of continued declining demand for buses from state and local municipalities. This has led some competitors to offer incentives and discounts at what we believe to be unsustainable levels. The division recently introduced a new bus design to better compete in the markets it serves.
Specialty vehicle division sales decreased by $1.9 million, or 47.0%, for the three months ended September 28, 2013, and decreased by $1.7 million, or 15.5%, for the nine months ended September 28, 2013. The decrease was primarily due to continued lower governmental procurement which directly affects our business with the U.S. Department of State. The Company continues to look for opportunities to expand its product offerings and increase its customer base for specialty products.
Cost of sales and gross profit
Gross profit decreased by $0.9 million, or 7.8%, to $10.7 million for the three months ended September 28, 2013, as compared with $11.6 million for the three months ended September 29, 2012. Gross profit decreased by $0.2 million, or 0.6%, to $35.7 million for the nine months ended September 28, 2013, as compared with $35.9 million for the nine months ended September 29, 2012. The following presents the components of cost of sales as a percentage of net sales and the changes from period to period:
Material Material cost as a percentage of net sales decreased by 1.4% and 2.3% for the three and nine months ended September 28, 2013, as compared with the corresponding periods in 2012. The decrease in the material percentage was due to favorable product mix, strategic purchasing of certain materials, and our focus on accepting good margin business. Although raw material commodity prices are stable, the potential for future raw material cost fluctuations remains an ongoing area of concern. The Company closely monitors major commodities to identify raw material cost escalations and attempts to pass through cost increases as markets will allow by having material adjustment clauses in most key customer contracts.
Direct Labor Direct labor as a percentage of net sales decreased by 0.3% and 0.9% for the three and nine months ended September 28, 2013, as compared with the corresponding periods in 2012. The decrease in the direct labor percentage resulted from recent plant redesigns, process improvements and enhanced manufacturing efficiencies at certain locations. However, in the quarter, the truck division experienced incremental training costs associated with the startup of the second half fleet business.
Overhead Manufacturing overhead as a percentage of net sales increased by 1.5% and 1.9% for the three and nine months ended September 28, 2013, as compared with the corresponding periods in 2012. The increase was primarily due to the fixed nature of certain overhead expenses that do not fluctuate with sales volume changes.
Delivery Delivery costs as a percentage of net sales increased by 0.4% and remained flat for the three and nine months ended September 28, 2013, respectively, as compared with the corresponding periods in 2012.
Selling, general and administrative expenses
Selling, general and administrative (G&A) expenses increased by $0.8 million, or 10.5% as a percentage of net sales, to $8.4 million for the three months ended September 28, 2013, as compared with $7.6 million for the three months ended September 29, 2012. Selling and G&A expenses increased by $1.3 million, or 5.4% as a percentage of net sales, to $25.5 million for the nine months ended September 28, 2013, as compared with $24.2 million for the nine months ended September 29, 2012. The following table presents selling and G&A expenses as a percentage of net sales and the changes from period to period as a percentage of net sales:
|
|
Three Months Ended |
|
Nine Months Ended |
| ||||||||||||||||||||||||||
($000s omitted) |
|
Sep 28, |
|
Sep 29, |
|
Change |
|
Sep 28, |
|
Sep 29, |
|
Change |
| ||||||||||||||||||
Selling expenses |
|
$ |
2,927 |
|
4.3 |
% |
$ |
2,493 |
|
3.5 |
% |
$ |
434 |
|
0.8 |
% |
$ |
9,176 |
|
4.4 |
% |
$ |
7,690 |
|
3.4 |
% |
$ |
1,486 |
|
1.0 |
% |
G&A expenses |
|
5,428 |
|
8.1 |
|
5,077 |
|
7.1 |
|
352 |
|
1.0 |
|
16,332 |
|
7.8 |
|
16,541 |
|
7.2 |
|
(209 |
) |
0.6 |
| ||||||
Total |
|
$ |
8,355 |
|
12.4 |
% |
$ |
7,570 |
|
10.6 |
% |
$ |
786 |
|
1.8 |
% |
$ |
25,508 |
|
12.2 |
% |
$ |
24,231 |
|
10.6 |
% |
$ |
1,277 |
|
1.6 |
% |
Selling expenses Selling expenses increased $0.4 million and $1.5 million for the three and nine months ended September 28, 2013, as compared to the corresponding periods in 2012. As a percentage of net sales, selling expenses increased 0.8% and 1.0% for the three and nine months ended September 28, 2013, as compared with the corresponding periods in 2012. The increases were the result of a change in the sales commission structure which better correlates to the profit contribution levels and lower marketing program incentives received in 2013 from chassis suppliers.
G&A expenses G&A expenses increased $0.4 million for the three months ended September 28, 2013, and decreased $0.2 million for the nine months ended September 28, 2013, as compared to the corresponding periods in 2012. As a percentage of net sales, G&A expenses increased 1.0% and 0.6% for the three and nine months ended September 28, 2013, as compared with the corresponding periods in 2012. The increase of $0.4 million for the three months ended September 28, 2013 reflects higher costs associated with the implementation of a new inventory management system and strategic headcount additions. The decrease of $0.2 million for the nine months ended September 28, 2013, was primarily due to lower legal fees.
Legal settlement and related costs
In February of 2012, the Company was named a defendant in a claim that a fleet of buses manufactured by the Company was defective (King County v. Supreme Corporation) which was filed in Superior Court in King County, Washington. King County sought to revoke its acceptance of a fleet of thirty-five buses, which had been manufactured by the Company and sold to King County, and alleged breach of contract and breach of implied warranties. As of February 28, 2013, King County claimed its damages were $10.6 million and subsequently moved to add a consumer protection act claim which would have permitted an award of attorneys fees, if successful. On June 14, 2013, the Company and King County entered into a Settlement and Release Agreement under the terms of which the lawsuit would be dismissed and mutual releases granted in exchange for payment of the sum of $4.7 million to King County within ninety days of the date of the agreement and the return of thirty-five buses to the Company. Through separate agreements, the Company settled third-party claims against certain third-party subcontractors who have contributed to the Company $520,000 of the settlement funds, with the Company responsible for the balance which was paid on September 9, 2013. The Company assigned an estimated $1.1 million to the returned product. Including the legal settlement and related costs, the Company recorded a pre-tax charge of $3.6 million for the first nine months of 2013.
Other income
Other income was $0.1 million and $0.8 million for the three and nine months ended September 28, 2013, compared with $0.2 million and $0.8 million for the three and nine months ended September 29, 2012. Other income consisted of rental income, gain on the sale of assets, and other miscellaneous income received by the Company.
Interest expense
Interest expense was $0.3 million and $0.5 million for the three and nine months ended September 28, 2013, compared with $0.1 million and $0.7 million for the three and nine months ended September 29, 2012. The increase of $0.2 million for the quarter was the result of Original Equipment Manufacturer (OEM) chassis interest support funds for a fleet run in 2012 which was not repeated in 2013 and lower per-unit OEM chassis interest support funds which decreases interest expense. During the first nine months of 2013, net interest expense was down 26% with bank interest expense declining 39% from year-to-date 2012. The decline in bank interest expense resulted from a combination of lower average bank borrowings and an improved pricing structure from a new credit agreement. The effective interest rate on bank borrowings was 2.53% at quarter end, and the Company was in compliance with all provisions of its Credit Agreement.
Income taxes
For the three and nine months ended September 28, 2013, the Company recorded income tax expense of $0.6 million and $2.1 million, respectively, at an effective tax rate of 27.2% and 30.8%, respectively, which differed from the federal statutory rate primarily because of state income tax and federal permanent income tax differences. For the three and nine months ended September 29, 2012, the Company recorded an income tax expense of $0.1 million and an income tax benefit of $0.2 million, respectively, resulting from the reversal of a deferred tax valuation allowance due to the improved profitability.
Net income
Net income for the three months ended September 28, 2013 was $1.5 million, or $0.09 per diluted share, compared with net income of $3.6 million, or $0.22 per diluted share for the comparable period last year. Net income for the first nine months ended September 28, 2013 was $4.8 million, or $0.29 per diluted share, compared with $11.4 million, or $0.71 per diluted share, last year.
Basic and diluted income per share
The following table presents a reconciliation of net income and net income per share to adjusted net income and adjusted net income per share. These non-GAAP financial measurements relate to an adjustment due to the costs of a legal settlement, which management believes should be adjusted because it was an unusual item, and to show the effect of current tax rates as the prior year tax rates were reduced by the reversal of a deferred tax valuation allowance related to previously unrecognized net operating loss carryforwards that were utilized. Management believes that these non-GAAP financial measures are helpful to show a more accurate comparison of the Companys operating performance year over year.
|
|
Three Months Ended |
|
Nine Months Ended |
| ||||||||
|
|
Sep 28, |
|
Sep 29, |
|
Sep 28, |
|
Sep 29, |
| ||||
|
|
2013 |
|
2012 |
|
2013 |
|
2012 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net income |
|
$ |
1,531,437 |
|
$ |
3,570,491 |
|
$ |
4,760,374 |
|
$ |
11,449,408 |
|
Legal settlement and related costs, net of tax |
|
|
|
227,392 |
* |
2,492,730 |
|
315,327 |
* | ||||
Adjusted income tax expense** |
|
|
|
(1,008,858 |
) |
|
|
(3,657,018 |
) | ||||
Adjusted net income |
|
$ |
1,531,437 |
|
$ |
2,789,025 |
|
$ |
7,253,104 |
|
$ |
8,107,717 |
|
|
|
|
|
|
|
|
|
|
| ||||
Per-share Data |
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net Income: |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
$ |
0.09 |
|
$ |
0.22 |
|
$ |
0.30 |
|
$ |
0.72 |
|
Diluted |
|
0.09 |
|
0.22 |
|
0.29 |
|
0.71 |
| ||||
Legal settlement and related costs, net of tax: |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
|
|
0.01 |
|
0.15 |
|
0.02 |
| ||||
Diluted |
|
|
|
0.01 |
|
0.15 |
|
0.02 |
| ||||
Adjusted income tax expense:** |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
|
|
(0.06 |
) |
|
|
(0.23 |
) | ||||
Diluted |
|
|
|
(0.06 |
) |
|
|
(0.23 |
) | ||||
Adjusted net income: |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
$ |
0.09 |
|
$ |
0.17 |
|
$ |
0.45 |
|
$ |
0.51 |
|
Diluted |
|
0.09 |
|
0.17 |
|
0.44 |
|
0.50 |
|
* Represents pro forma tax effected legal costs.
** 2012 pro forma income tax expense adjusted to 2013s normalized rates of 30.8%.
Shares used in the computation of income per share: |
|
|
|
|
|
|
|
|
|
(Adjusted for 5% stock dividend paid on June 3, 2013) |
|
|
|
|
|
|
|
|
|
Basic |
|
16,160,518 |
|
15,966,506 |
|
16,087,864 |
|
15,945,830 |
|
Diluted |
|
16,546,113 |
|
16,243,852 |
|
16,425,542 |
|
16,209,108 |
|
Liquidity and Capital Resources
Cash Flows
The Companys primary sources of liquidity have been cash flows from operating activities and borrowings under its credit agreements. Principal uses of cash have been to support working capital needs, meet debt service obligations, and fund capital expenditures.
Operating activities
Cash flows from operating activities represent the net income earned in the reported periods adjusted for non-cash charges and changes in operating assets and liabilities. Net cash provided by operating activities totaled $2.3 million for the nine months ended September 28, 2013, as compared with $7.9 million for the nine months ended September 29, 2012. Net cash provided by operating activities was impacted by a $4.7 million increase in inventories and a $4.4 million increase in accounts receivable, both reflecting increased business activity at the end of September 2013 as compared to the end of December 2012. These were partially offset by a $3.1 million increase in trade accounts payable related primarily to the increase in inventories necessary to support the $17.7 million increase in sales order backlog at September 28, 2013 as compared to the end of December 2012. Additionally, net cash from operating activities was adversely impacted by a net cash payment of $4.2 million for the legal settlement.
Investing activities
Net cash used in investing activities was $3.8 million for the nine months ended September 28, 2013 as compared with $1.0 million for the nine months ended September 29, 2012. During the first nine months of 2013, the Companys capital expenditures totaled $5.0 million and consisted primarily of investments in facilities and equipment. Additionally, during the first quarter of 2013 net cash of $1.2 million was received as a result of the sale of an excess capacity facility in Goshen, Indiana, which was previously included in assets held for sale.
Financing activities
Net cash provided by financing activities was $1.4 million for the first nine months of 2013. During September 2013 the Company utilized its revolving line of credit to finance the legal settlement resulting in a net cash payment of $4.2 million. The legal settlement liability was included in other accrued liabilities at June 29, 2013. Net cash used in financing activities of $3.6 million for the nine months ended September 29, 2012, resulting primarily from payments against the Companys revolving line of credit and other long-term debt.
Capital Resources
Credit Agreement
On December 19, 2012, the Company entered into an Amended and Restated Credit Agreement (the Credit Agreement) with Wells Fargo Bank (the Lender). Under the terms of the Credit Agreement, Lender agrees to provide to the Company a credit facility of up to $45.0 million, consisting of a revolving credit facility, a term loan facility, and a letter of credit facility. The Credit Agreement is for a period of five years ending on December 19, 2017. The Company had unused credit capacity of $25.4 million at September 28, 2013 and was in compliance with all provisions of its credit agreement.
Summary of Liquidity and Capital Resources
The Companys primary capital needs are for working capital demands, to meet its debt service obligations, and to fund capital expenditure requirements. Cash generated from operations, and borrowings available under our credit agreement, are expected to be sufficient to finance the known and foreseeable liquidity and capital needs of the Company for at least the next 12 months based on our current cash flow budgets and forecasts of our liquidity needs.
Critical Accounting Policies and Estimates
Managements discussion and analysis of its financial position and results of operations are based upon the Companys condensed consolidated financial statements which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. The Companys significant accounting policies are discussed in Note 1 of the Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended December 29, 2012. In managements opinion, the Companys critical accounting policies include revenue recognition, allowance for doubtful accounts, excess and obsolete inventories, inventory relief, fair value of assets held for sale, accrued insurance, and accrued warranty.
Revenue Recognition The Company generally recognizes revenue when products are shipped to the customer. Revenue on certain customer requested bill and hold transactions is recognized after the customer is notified that the products have been completed according to customer specifications, have passed all of the Companys quality control inspections, and are ready for delivery based on established delivery terms.
Allowance for Doubtful Accounts The Company maintains an allowance for doubtful accounts which is determined by management based on the Companys historical losses, specific customer circumstances, and general economic conditions. Periodically, management reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables against the allowance when all attempts to collect the receivables have failed.
Excess and Obsolete Inventories The Company must make estimates regarding the future use of raw materials and finished products and provide for obsolete or slow-moving inventories. Periodically, management reviews inventories and adjusts the excess and obsolete reserves based on product life cycles, product demand, and/or market conditions.
Inventory Relief For monthly and quarterly financial reporting, cost of sales is recorded and inventories are relieved by the use of standard bills of material adjusted for scrap and other estimated factors affecting inventory relief. Because of our large and diverse product line and the customized nature of each order, it is difficult to place full reliance on the bills of material for accurate relief of inventories. Although the Company continues to refine the process of creating accurate bills of materials, manual adjustments (which are based on estimates) are necessary in an effort to assure correct relief of inventories for products sold. The calculations to estimate costs not captured in the bill of materials take into account the customized nature of products, historical inventory relief percentages, scrap variances, and other factors which could impact inventory cost relief.
The accuracy of the inventory relief is not fully known until physical inventories are conducted at each of the Companys locations. We conduct semi-annual physical inventories at a majority of locations and schedule them in a manner that provides coverage in each of our calendar quarters. We have invested significant resources in our continuing effort to improve the physical inventory process and accuracy of our inventory accounting system.
Fair Value of Assets Held for Sale Assets held for sale are carried at fair value less costs to dispose. The Company evaluates the carrying value of property held for sale whenever events or changes in circumstances indicate that a propertys carrying amount may not be recoverable. Such circumstances could include, but are not limited to (1) a significant decrease in the market value of an asset, or (2) a significant adverse change in the extent or manner in which an asset is used. The Company measures the carrying amount of the asset against the estimated undiscounted future cash flows associated with it. Should the sum of the expected future net cash flows be less than the carrying value of the asset being evaluated, an impairment loss would be recognized. The impairment loss would be calculated as the amount by which the carrying value of the asset exceeds its fair value. The Company estimates the fair value of its properties held for sale based on appraisals and other current market data.
Accrued Insurance - The Company has a self-insured retention against product liability claims with insurance coverage over and above the retention. The Company is also self-insured for a portion of its employee medical benefits and workers compensation. Product liability claims are routinely reviewed by the Companys insurance carrier, and management routinely reviews other self-insurance risks for purposes of establishing ultimate loss estimates. In addition, management must determine estimated liability for claims incurred but not reported. Such estimates, and any subsequent changes in estimates, may result in adjustments to our operating results in the future.
Accrued Warranty The Company provides limited warranties for periods of up to five years from the date of retail sale. Estimated warranty costs are accrued at the time of sale and are based upon historical experience.
Forward-Looking Statements
This report contains 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, as amended, other than historical facts, which reflect the view of management with respect to future events. When used in this report, words such as believe, expect, anticipate, estimate, intend, and similar expressions, as they relate to the Company or its plans or operations, identify forward-looking statements. Such forward-looking statements are based on assumptions made by, and information currently available to, management. Although management believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that the expectations reflected in such forward-looking statements are reasonable, and it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from such expectations include, without limitation, an economic slowdown in the specialized vehicle industry, restrictions on financing imposed by the Companys lender(s), limitations on the availability of chassis on which the Companys products are dependent, availability of raw materials, raw material cost increases, and severe interest rate increases. Furthermore, the Company can provide no assurance that such raw material cost increases can be passed on to its customers through implementation of price increases for the Companys products. The forward-looking statements contained herein reflect the current view of management with respect to future events and are subject to those factors and other risks, uncertainties, and assumptions relating to the operations, results of operations, cash flows, and financial position of the Company. The Company assumes no obligation to update the forward-looking statements or to update the reasons actual results could differ from those contemplated by such forward-looking statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Except as set forth below, there has been no material change from the information provided in the Companys Annual Report on Form 10-K, Item 7A: Quantitative and Qualitative Disclosures About Market Risk, for the year ended December 29, 2012. In the normal course of business, the Company is exposed to fluctuations in interest rates that can impact the cost of investing, financing, and operating activities. The Companys primary risk exposure results from changes in short-term interest rates. In an effort to manage risk exposures, the Company strives to achieve an acceptable balance between fixed and floating rate debt positions. The Companys Credit Agreement is floating rate debt and bears interest at the banks prime rate or LIBOR plus certain basis points depending on the pricing option selected and the Companys leverage ratio. On August 9, 2013, the Company entered into an interest rate swap agreement for a portion of its term loan with a notional amount of $5.0 million (See Note 5 - Long-Term Debt). The interest rate swap agreement is a contract to exchange floating rate for fixed rate interest payments over the life of the interest rate swap agreement and is used to measure interest to be paid or received and does not represent the amount of exposure of credit loss. The differential paid or received under the interest rate swap agreement is recognized as an adjustment to interest expense.
ITEM 4. CONTROLS AND PROCEDURES.
a. Evaluation of Disclosure Controls and Procedures.
In connection with the preparation of this Form 10-Q, an evaluation was performed under the supervision and with the participation of the Companys management, including the Companys Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Companys disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Companys disclosure controls and procedures are effective as of September 28, 2013.
b. Changes in Internal Control over Financial Reporting.
There has been no change in the Companys internal control over financial reporting during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial reporting.
The Company continues to take action to assure compliance with the internal controls, disclosure controls, and other requirements of the Sarbanes-Oxley Act of 2002. Management, including the Companys Chief Executive Officer and Chief Financial Officer, cannot guarantee that the internal controls and disclosure controls will prevent all possible errors or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of a control system have been met. In addition, the design of a control system must reflect the fact that there are resource constraints, and the benefit of controls must be relative to their costs. Because of the inherent limitations in all control systems, no system of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company will be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Further, controls can be circumvented by individual acts of some persons, by collusion of two or more persons, or by management override of the controls.
The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may be inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate. Because of inherent limitations in any cost-effective control system, misstatements due to error or fraud may occur and not be detected.
The Company is subject to various investigations, claims, and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved unfavorably to the Company. The Company establishes accruals for matters that are probable and reasonably estimable. See Note 8 Commitments and Contingencies for a description of certain developments with respect to legal proceedings that occurred during the third quarter of 2013.
For a discussion of those Risk Factors affecting the Company, you should carefully consider the Risk Factors discussed in Part I, under Item 1A: Risk Factors contained in our Annual Report on Form 10-K for the year ended December 29, 2012, which is herein incorporated by reference.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
Not applicable.
Exhibits:
Exhibit 3.1 |
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Certificate of Incorporation of the Company, filed as Exhibit 3(a) to the Companys Registration Statement on Form 8-A, filed with the Commission on September 18, 1989, and incorporated herein by reference. |
Exhibit 3.2 |
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Certificate of Amendment of Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on June 10, 1993 filed as Exhibit 3.2 to the Companys annual report on Form 10-K for the fiscal year ended December 31, 1993, and incorporated herein by reference. |
Exhibit 3.3 |
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Certificate of Amendment of Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on May 29, 1996 filed as Exhibit 3.3 to the Companys annual report on Form 10-K for the fiscal year ended December 31, 1996, and incorporated herein by reference. |
Exhibit 3.4 |
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Second Amended and Restated Bylaws, filed as Exhibit 3.1 to the Companys current report on Form 8-K, filed on February 22, 2011, and incorporated herein by reference. |
Exhibit 10.1* |
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2013 Supreme Cash and Equity Bonus Plan dated August 7, 2013. |
Exhibit 31.1* |
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Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
Exhibit 31.2* |
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Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
Exhibit 32.1* |
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Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
Exhibit 32.2* |
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Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
Exhibit 101* |
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The following financial statements from the Companys Quarterly Report on Form 10-Q for the quarter ended September 28, 2013, filed on November 5, 2013, formatted in XBRL: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Statements of Cash Flows and (iv) the Notes to Consolidated Financial Statements. |
*Filed herewith.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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SUPREME INDUSTRIES, INC. |
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By: |
/s/ Mark D. Weber |
DATE: November 5, 2013 |
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Mark D. Weber |
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President and Chief Executive Officer |
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By: |
/s/ Matthew W. Long |
DATE: November 5, 2013 |
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Matthew W. Long |
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Chief Financial Officer |
Exhibit |
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Number |
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Description of Document |
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Exhibit 3.1 |
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Certificate of Incorporation of the Company, filed as Exhibit 3(a) to the Companys Registration Statement on Form 8-A, filed with the Commission on September 18, 1989, and incorporated herein by reference. |
Exhibit 3.2 |
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Certificate of Amendment of Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on June 10, 1993 filed as Exhibit 3.2 to the Companys annual report on Form 10-K for the fiscal year ended December 31, 1993, and incorporated herein by reference. |
Exhibit 3.3 |
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Certificate of Amendment of Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on May 29, 1996 filed as Exhibit 3.3 to the Companys annual report on Form 10-K for the fiscal year ended December 31, 1996, and incorporated herein by reference. |
Exhibit 3.4 |
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Second Amended and Restated Bylaws, filed as Exhibit 3.1 to the Companys current report on Form 8-K, filed on February 22, 2011, and incorporated herein by reference. |
Exhibit 10.1* |
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2013 Supreme Cash and Equity Bonus Plan dated August 7, 2013. |
Exhibit 31.1* |
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Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
Exhibit 31.2* |
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Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
Exhibit 32.1* |
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Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
Exhibit 32.2* |
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Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
Exhibit 101* |
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The following financial statements from the Companys Quarterly Report on Form 10-Q for the quarter ended September 28, 2013, filed on November 5, 2013, formatted in XBRL: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Statements of Cash Flows and (iv) the Notes to Consolidated Financial Statements. |
*Filed herewith.
Exhibit 10.1
2013 SUPREME CASH AND EQUITY BONUS PLAN
SECTION 1. DEFINITIONS: Terms capitalized in this 2013 Supreme Cash and Equity Bonus Plan (the 2013 Bonus Plan), but not otherwise defined herein, shall have the meanings ascribed to such terms in the Supreme Industries, Inc. 2012 Long-Term Incentive Plan.
Award: Shall mean after the Plan Year and all Performance Goal achievement is determined, the grant of equity and/or payment of cash pursuant to the terms of this 2013 Bonus Plan.
Cash Target Incentive: Shall mean a target dollar amount that a Participant will earn, payable in the form of cash, if all applicable Performance Goals for the Plan Year are achieved at the 100% level. The target is set for each Participant in accord with their function within the Company.
Equity Target Incentive: Shall mean a target dollar amount that a Participant will earn, payable in the form of equity, if all applicable Performance Goals for the Plan Year are achieved at the 100% level. The target is set for each Participant in accord with their function within the Company.
Leadership Team: Shall mean the following individuals:
Mark Weber: |
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President and Chief Executive Officer |
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Matt Long: |
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Chief Financial Officer |
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Mike Oium: |
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Vice President, Operations |
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John Dorbin: |
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Vice President and General Counsel |
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Brad Karch: |
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Vice President, Human Resources |
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Roman Jach: |
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Vice President, Engineering |
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Jeff Furhmeister: |
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Vice President, Sales |
Participant: Shall mean the Leadership Team and any other employee of the Company designated as covered by this 2013 Bonus Plan by the CEO with the advice and consent of Supreme Industries, Inc.s Management Committee.
Plan Year: Shall mean January 1, 2013 through December 31, 2013.
Qualitative Performance Goals: Shall mean Performance Goals based on Qualitative Performance Measures.
Qualitative Performance Measures: Shall mean those objective and subjective factors which are selected by the Compensation Committee and which the Compensation Committee may, in its discretion, consider in determining each Participants Award.
Quantitative Performance Goals: Shall mean Performance Goals based on Quantitative Performance Measures.
Quantitative Performance Measures: Shall mean those specific and objectively measurable financial metrics which are selected by the Compensation Committee.
Supreme or Company: Shall mean Supreme Industries, Inc. or any subsidiary of Supreme Industries, Inc.
SECTION 2. SUMMARY: The 2013 Bonus Plan is intended to provide financial incentives to executive officers and key employees of Supreme Industries, Inc. and its subsidiaries through the use of at risk variable pay tied to specific performance incentives which will motivate their actions and behaviors in ways beneficial to the Company and its stockholders. This 2013 Bonus Plan will offer Participants the opportunity to earn a bonus paid out in the form of cash, as well as a bonus paid out in the form of equity for the attainment of 2013 Bonus Plan incentives.
SECTION 3. PHILOSOPHY: The Board believes that compensation of executive officers and key employees should be partially at risk and variable, based on performance against certain pre-established financial objectives and other goals that are important to the Company. The 2013 Supreme Cash and Equity Bonus Plan (the 2013 Bonus Plan) is intended to focus the efforts of the Participants on achieving those objectives in order to help ensure the sustained profitability, long-term growth, and continued wellbeing of the Company. The Board believes that doing so aligns the interests of management with stockholders.
The 2013 Bonus Program is based on a compensation study. The 2013 Bonus Plan is structured to provide Participants with competitive cash and equity rewards for successful performance, which enables the Company to attract and retain critical management resources.
SECTION 4. ADMINISTRATION: Administration of this 2013 Bonus Plan shall be vested in the Compensation Committee. The decisions of the Compensation Committee shall be final as to the interpretation of the 2013 Bonus Plan or any rule, procedure or action related thereto. All Participants consent to the transfer and use of personal data by the Company and its agents in connection with the administration of this 2013 Bonus Plan.
SECTION 5. ELIGIBILITY: Only Participants as defined above are eligible to participate in the 2013 Bonus Plan.
To receive an Award under the 2013 Bonus Plan, a Participant must be an active, full-time employee on the last business day of the Plan Year, except as provided herein. An employee who is hired or promoted after the date of adoption of this 2013 Bonus Plan may be selected as a Participant at such time, provided that any Award earned by such Participant shall be prorated to reflect that Participants actual time in service, except as otherwise provided by the Board pursuant to an employment agreement or similar document.
If a Participant dies or incurs a Total and Permanent Disability, an Award, prorated on the basis of Participants actual time in service with the Company during the Plan Year prior to death or Total and Permanent Disability, will be paid to the Participant or his or her beneficiary at the same time and in the same manner as Awards for the Plan Year are paid to the other Participants. The Participants beneficiary under the 2013 Bonus Plan shall be the beneficiary designated for the Participants group life insurance plan. If no such beneficiary has been designated, the Award will be paid to the Participants estate.
If a Participant terminates service due to Retirement prior to the last day of the Plan Year, an Award, prorated on the basis of Participants actual time in service with the Company during the Plan Year prior to Retirement, shall be paid to the Participant at the same time and in the same manner as Awards for the Plan Year are paid to other Participants.
If a Change In Control occurs prior to the last day of the Plan Year, the full value of the Award, payable based on the Cash Target Incentive or Equity Target Incentive, as applicable, shall be paid to the Participant on or within 30 days of the Change In Control.
SECTION 6. SETTING OF TARGET INCENTIVES, PERFORMANCE GOALS, AND CALCULATION OF AWARDS FOR THE LEADERSHIP TEAM: Management has submitted recommendations for the 2013 Bonus Plan based on compensation studies done by the Companys independent compensation consultant experts and the recommendations of the Management Committee. The Compensation Committee has reviewed these proposals in conjunction with a compensation study to determine whether managements recommendations generally align with the compensation study and the Companys 2013 budget and other factors. The Compensation Committee determined that the procedures and goals outlined in this section were proper and suitable to meet the Companys goals.
The determination of the Cash Target Incentive and Equity Target Incentive will be made by the Compensation Committee of the Board for each member of the Leadership Team. Each member of the Leadership Team will have their Cash Target Incentive, Equity Target Incentive, personal goal(s) and maximum possible Award provided to them in writing separate from this 2013 Bonus Plan. At the time that an OTIP transaction appears more likely, equity grants may take into consideration the prospective value of each Participants OTIP percentage participation on a discounted basis. For 2013, it has been determined that the OTIP will not be taken into consideration with regard to any equity related grants.
All cash Awards and equity Awards will be based on quantitative and qualitative measures.
Quantitative Performance Goals will be weighted to account for 2/3rds of the Award determination and;
Qualitative Performance Goals will be weighted to account for 1/3rd of the Award determination.
Quantitative Performance Goals for the Leadership Team in 2013 are as follows:
· Dollar amounts of revenues and operating income as forecasted
· Gross margin of (redacted)
· EBITDA/average equity based on forecast (add back pro-forma any interest incurred at average annual borrowing rate and equity reduction that might arise due to any Dutch-auction or similar transaction)
In determining the Quantitative component of the award, weighting of the above goals is 50% for the first goal (subdivided to 1/3 for revenue and 2/3 for operating income of the 50%) and 25% for each of the other two goals.
Qualitative Performance Goals for the Leadership Team in 2013:
· Successful transition from the Office of the President to the new CEO
· Improvements to regional plants concluded
· Successful completion of three (3) personal goals
In determining the qualitative component of the award, each of the above goals is weighted 1/3 each and the personal goal will be further subdivided into 1/3 for attainment of each personal goal.
Quantitative Performance Goal achievement will be determined by comparing the relevant 2013 Performance Goal with the Companys actual performance for that financial metric during the Plan Year. The threshold for each Quantitative Performance Goal is at least 80% of the goal set for 2013. For each one percent increment (rounded to the nearest whole percentage) below the goal, achievement for a Performance Goal will decline by five percent (5%) until reaching the threshold, below which there will be no Award achievement attributable to that particular Performance Goal.
Participants may earn above target incentive Awards for above goal performance, up to a maximum Award of 125% of the target incentive. The maximum performance cap is 125% for each Quantitative Performance Goal. For each one percent increment (rounded to the nearest whole percentage) of above goal performance, achievement for a Performance Goal will increase by two percent (2%), up to the 125% cap. This results in
a maximum possible achievement of 125% of target incentive for Quantitative Performance Goals.
Except with respect to the CEO, which will be determined by all independent members of the Board, Qualitative Performance Goal achievement for the Plan Year will be determined by the Compensation Committee, in its sole discretion. However, the Management Committee will present their recommendations to the Compensation Committee.
Once the Compensation Committee determines the level of achievement for each Performance Goal, the Compensation Committee will apply the weighting for each Performance Goal and apply the 2/3 Quantitative Measures and 1/3 Qualitative measures split. That factor will be multiplied by each member of the Leadership Teams Cash Target Incentive and Equity Target Incentive to arrive at the Participants cash Award and equity Award.
The Compensation Committee may, in its discretion, adjust the payout of an Award downward after consideration of other business factors, including overall performance of the Company and the individuals contribution to Company performance. The Compensation Committee may reduce or entirely eliminate an Award in the event a Participant is on a performance improvement plan or otherwise demonstrates unsatisfactory performance or discipline during the Plan Year. The Compensation Committee may adjust a payout of an Award in its discretion to prevent the enlargement or dilution of the Award because of extraordinary events or circumstances as determined by the Compensation Committee.
SECTION 7. TARGET INCENTIVES, PERFORMANCE GOALS AND CALCULATION OF AWARDS FOR OTHER PARTICIPANTS: Once the Leadership Team target incentives and goals are set, the CEO will then set target incentives and goals for all other Participants, utilizing the Quantitative Goals specified above, setting Qualitative Goals relating each individuals job functions, and with weighting to be determined by the CEO. Prior to advising the Participants of their participation in this 2013 Bonus Plan, the CEO will advise the Compensation Committee of its determinations. Awards will be calculated in the same manner as specified above.
SECTION 8. APPROVAL AND PAYMENT OF AWARDS: Upon completion of the Plan Year, the Compensation Committee shall certify to what extent the Performance Goals were met and determine the Award payable to each Participant based on information supplied and certified by management. Certification by the Compensation Committee shall be subject to completion of the annual audit and certification of overall Company results by the Companys independent auditors and the CEOs Award shall be subject to ratification by the independent members of the Board of Directors. Payment of cash Awards shall be made in a lump sum payment in cash except to the extent of Participants elective contribution to any qualified deferred compensation plan. Payment of equity Awards shall be made in the form of a grant of restricted stock pursuant to the Supreme Industries, Inc. 2012 Long-Term Incentive Plan, which will vest
over three years in equal increments, in accord with a form of agreement to be approved by the Compensation Committee. To the extent Awards are subject to Section 409A of the Code, payments are intended to qualify as short-term deferrals under the regulations adopted under Section 409A of the Code. Payment of cash Awards and determination and grant of equity Awards shall be made as soon as reasonably practicable in 2014, but no later than March 15, 2014. The Company may deduct from any Award such amounts as may be required to be withheld under any federal, state or local tax laws.
SECTION 9. RECOUPMENT OF AWARDS: If the Board learns of any intentional misconduct by a Participant which directly contributes to the Company having to restate all or a portion of its financial statements, the Board may, in its sole discretion, require the Participant to reimburse the Company for the difference between any Awards paid to the Participant based on achievement of financial results that were subsequently the subject of a restatement and the amount the Participant would have earned as awards under the 2013 Bonus Plan based on the financial results as restated.
SECTION 10. NO CONTRACT: The 2013 Bonus Plan is not and shall not be construed as an employment contract or as a promise or contract to pay Awards to Participants or their beneficiaries. The 2013 Bonus Plan shall be approved by the Compensation Committee and may be amended from time to time by the Compensation Committee or terminated without notice. No Participant or beneficiary may sell, assign, transfer, discount or pledge as collateral for a loan, or otherwise anticipate any right to payment of an Award under this 2013 Bonus Plan.
SECTION 11. GOVERNING LAW This 2013 Bonus Plan shall be governed by the laws of the State of Delaware.
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Mark D. Weber, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Supreme Industries, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
DATE: November 5, 2013 |
/s/ Mark D. Weber |
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Mark D. Weber |
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Chief Executive Officer |
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Matthew W. Long, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Supreme Industries, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
DATE: November 5, 2013 |
/s/ Matthew W. Long |
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Matthew W. Long |
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Chief Financial Officer |
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), the undersigned officer of Supreme Industries, Inc. (the Company) does hereby certify, to such officers knowledge, that:
The Quarterly Report on Form 10-Q for the quarter ended September 28, 2013 (the Form 10-Q) of the Company fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company as of, and for, the periods presented in the Form 10-Q.
DATE: November 5, 2013 |
/s/ Mark D. Weber |
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Mark D. Weber |
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Chief Executive Officer |
The foregoing certification is being furnished as an exhibit to the Form 10-Q pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and, accordingly, is not being filed as part of the Form 10-Q for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Exhibit 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), the undersigned officer of Supreme Industries, Inc. (the Company) does hereby certify, to such officers knowledge, that:
The Quarterly Report on Form 10-Q for the quarter ended September 28, 2013 (the Form 10-Q) of the Company fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company as of, and for, the periods presented in the Form 10-Q.
DATE: November 5, 2013 |
/s/ Matthew W. Long |
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Matthew W. Long |
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Chief Financial Officer |
The foregoing certification is being furnished as an exhibit to the Form 10-Q pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and, accordingly, is not being filed as part of the Form 10-Q for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
INVENTORIES (Details) (USD $)
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Sep. 28, 2013
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Dec. 29, 2012
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INVENTORIES | ||
Raw materials | $ 23,284,651 | $ 21,557,053 |
Work-in-progress | 4,741,838 | 3,654,801 |
Finished goods | 8,957,198 | 7,097,077 |
Total | $ 36,983,687 | $ 32,308,931 |
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