-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KnDLo25UfWF+j9hw/RTnOzA/X4vHyA9b1PRbwkJDFgTL2TvJu1vY0h/1MZGFnb0V PPyY3I75cAENM5g2jBoSJQ== 0000861361-96-000010.txt : 19960625 0000861361-96-000010.hdr.sgml : 19960625 ACCESSION NUMBER: 0000861361-96-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960525 FILED AS OF DATE: 19960624 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: BE AEROSPACE INC CENTRAL INDEX KEY: 0000861361 STANDARD INDUSTRIAL CLASSIFICATION: PUBLIC BUILDING AND RELATED FURNITURE [2531] IRS NUMBER: 061209796 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-18348 FILM NUMBER: 96584531 BUSINESS ADDRESS: STREET 1: 1400 CORPORATE CENTER WAY CITY: WELLINGTON STATE: FL ZIP: 33414 BUSINESS PHONE: 4077915000 MAIL ADDRESS: STREET 1: 1300 CORPORATE CENTER WAY STREET 2: 1300 CORPORATE CENTER WAY CITY: WELLINGTON STATE: FL ZIP: 33414 FORMER COMPANY: FORMER CONFORMED NAME: BE AVIONICS INC DATE OF NAME CHANGE: 19920608 10-Q 1 1ST QUARTER 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended May 25, 1996 Commission File No. 0-18348 BE AEROSPACE, INC. (Exact name of registrant as specified in its charter) Delaware 06-1209796 (State of Incorporation) (I.R.S. Employer Identification No.) 1400 Corporate Center Way Wellington, Florida 33414 (Address of principal executive offices) (407) 791-5000 (Registrant's telephone number, including area code) 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[ ] The registrant has one class of common stock, $ .01 par value, of which 16,623,214 shares were outstanding as of June 14, 1996. BE AEROSPACE, INC. Item 1. Financial Statements CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share data)
May 25, February 24, 1996 1996 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 6,151 $ 15,376 Receivables - trade, less allowance for doubtful accounts of $5,156 (May 25, 1996) and $4,973 (February 24, 1996) 63,423 54,242 Inventories, net 72,645 72,569 Other current assets 8,469 7,621 --------- --------- Total current assets 150,688 149,808 PROPERTY AND EQUIPMENT, net 83,918 86,357 INTANGIBLES AND OTHER ASSETS, net 194,319 197,421 --------- --------- $ 428,925 $ 433,586 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 45,807 $ 45,102 Accrued expenses 47,984 56,400 Current portion of long-term debt 6,160 6,482 --------- --------- Total current liabilities 99,951 107,984 LONG-TERM DEBT 272,104 273,192 DEFERRED INCOME TAXES 1,792 1,257 OTHER LIABILITIES 9,121 6,996 STOCKHOLDERS' EQUITY: Preferred stock, $.01 par value; 1,000,000 shares authorized; no shares outstanding Common stock, $.01 par value; 30,000,000 shares authorized; 16,535,714 (May 25, 1996) 16,392,994 (February 24, 1996) issued 165 164 Additional paid-in capital 122,614 121,366 Retained earnings (deficit) (74,562) (75,995) Cumulative foreign exchange translation adjustment (2,260) (1,378) --------- --------- Total stockholders' equity 45,957 44,157 --------- --------- $ 428,925 $ 433,586 ========= =========
BE AEROSPACE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share data)
Three Months Ended May 25, May 27, 1996 1995 NET SALES $ 97,302 $ 55,594 COST OF SALES 64,755 37,152 -------- -------- GROSS PROFIT 32,547 18,442 OPERATING EXPENSES: Selling, general and administrative 11,585 8,300 Research, development and engineering 9,727 13,303 Amortization expense 2,708 2,333 -------- -------- Total operating expenses 24,020 23,936 -------- -------- OPERATING EARNINGS (LOSS) 8,527 (5,494) INTEREST EXPENSE, net 6,935 4,188 -------- -------- EARNINGS (LOSS) BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE 1,592 (9,682) INCOME TAXES 159 -- -------- -------- EARNINGS (LOSS) BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE 1,433 (9,682) CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE -- (23,332) -------- -------- NET EARNINGS (LOSS) $ 1,433 $(33,014) ======== ======== EARNINGS (LOSS) PER COMMON SHARE: Earnings (loss) before cumulative effect of change in accounting principle $ .08 $ (.60) Cumulative effect of change in accounting principle -- (1.45) -------- -------- NET EARNINGS (LOSS) PER COMMON SHARE $ .08 $ (2.05) ======== ======== COMMON AND COMMON EQUIVALENT SHARES 17,241 16,097 ======== ========
BE AEROSPACE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands)
Three Months Ended May 25, May 27, 1996 1995 CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings (loss) $ 1,433 $(33,014) Adjustments to reconcile net loss to net cash flows provided by operating activities: Depreciation and amortization 5,350 4,086 Cumulative effect of change in accounting principle -- 23,332 Deferred income taxes 534 330 Non cash employee benefit plan contributions 83 169 Changes in operating assets and liabilities: Accounts receivable (9,402) 2,519 Inventories (209) (2,116) Other current assets (460) 427 Accounts payable 1,408 1,043 Other liabilities (6,549) (4,438) -------- -------- Net cash flows used in operating activities (7,812) (7,662) CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (1,218) (1,187) Change in other assets - net 43 (3,992) -------- -------- Net cash flows used in investing activities (1,175) (5,179) CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings under revolving lines of credit -- 7,646 Repayments of long-term debt (1,364) -- Proceeds from issuances of stock 1,165 -- -------- -------- Net cash flow (used in) provided by financing activities (199) 7,646 Effect of exchange rate changes on cash flows (39) 45 -------- -------- Net decrease in cash and cash equivalents (9,225) (5,150) Cash and cash equivalents, beginning of period 15,376 8,319 -------- -------- Cash and cash equivalents, end of period $ 6,151 $ 3,169 ======== ======== Supplemental disclosures of cash flow information: Cash paid during period for interest $ 6,734 $ 7,250 Cash paid during period for income taxes, net $ (1,102)
BE AEROSPACE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED MAY 25, 1996 AND MAY 27, 1995 Note 1. Basis of Presentation: The information set forth in these consolidated financial statements as of May 25, 1996 and for the three months ended May 25, 1996 and May 27, 1995 is unaudited and may be subject to normal year-end adjustments. In the opinion of management, the unaudited consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments necessary to present fairly the financial position of BE Aerospace, Inc. (the "Company" or "BEA") for the periods indicated. Results of operations for the interim periods ended May 25, 1996 are not necessarily indicative of the results of operations for the full fiscal year. For further information, including information with regard to conditions in the airline industry and their possible impact on the Company, please refer to the Company's annual report on Form 10-K for the fiscal year ended February 24, 1996. The accompanying consolidated financial statements consolidate all of the Company's subsidiaries. All significant intercompany transactions have been eliminated. Certain amounts in the prior years' Consolidated Financial Statements have been reclassified to conform to the current fiscal year's presentation. Certain information normally included in footnote disclosures to the annual financial statements has been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission. [Remainder of page intentionally left blank] BE AEROSPACE, INC. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Dollars in thousands, except per share data) The following discussion and analysis addresses the results of the Company's operations for the three months ended May 25, 1996, as compared to the Company's results of operations for the three months ended May 27, 1995. The discussion and analysis then addresses the liquidity and financial condition of the Company. THREE MONTHS ENDED MAY 25, 1996, AS COMPARED TO THE RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MAY 27, 1995. Sales for the three months ended May 25, 1996 were $97,302, or $41,708 (75%) greater than sales of $55,594 for the comparable period in the prior year. The increase in revenues during fiscal 1997 is attributable to substantially higher unit volume shipments of all of the Company's products as a result of improving industry conditions. $26,758 of the $41,708 increase in revenues for the quarter was due to increased seating product revenues directly related to the acquisition of Burns Aerospace Corporation ("Burns") which was completed on January 24, 1996. Excluding the effect of the Burns acquisition revenues were up 26.9%. At May 25, 1996 the Company's backlog stood at approximately $475,000, up from approximately $450,000 at February 24, 1996 and $350,000 at May 27, 1995. Gross profit was $32,547 (33.4% of sales) for the three months ended May 25, 1996 and was $14,105 greater than the comparable period in the prior year of $18,442, which represented 33.2% of sales. The increase in gross profit is the result of the higher sales volume. Selling, general and administrative expenses were $11,585 (11.9% of sales) for the three months ended May 25, 1996. This was $3,285 higher than the comparable period in the prior year of $8,300 (14.9% of sales) and is primarily due to the acquisition of Burns. Research, development and engineering expense was $9,727 or 10.0% of sales for the three months ended May 25, 1996. For the comparable period in the prior year, research, development and engineering expense was $13,303 or 23.9% of sales. The decrease in expense is the result of a decrease in the level of activity during the quarter associated with MDDS, offset somewhat by an increase in product development activity in the seating products division. Amortization expense for the quarter ended May 25, 1996 of $2,708 was $375 greater than the amount recorded in the first quarter of fiscal 1995. This increase is attributable to the Burns acquisition. Operating expenses in total were essentially unchanged and represent 24.7% of sales this year verses 43.1% in the prior year. Interest expense, net was $6,935 for the three months ended May 25, 1996, or $2,747 higher than interest expense of $4,188 recorded for the comparable period in the prior year, and is due in large part to the increase in the Company's long-term debt as a result of the Burns acquisition and the upturn in the Company's business. BE AEROSPACE, INC. THREE MONTHS ENDED MAY 25, 1996, AS COMPARED TO THE RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MAY 27, 1995. (Continued) Earnings before income taxes and cumulative effect of accounting change of $1,592 for the quarter ended May 25, 1996 was $11,274 greater than the loss before taxes and cumulative effect of the accounting change in the prior year. Income taxes for the quarter ended May 25, 1996 was $159 or 10% of earnings before income taxes. Net earnings were $1,433 or $.08 per share for the three months ended May 25, 1996, as compared to a net loss of $33,014 or ($2.05) per share for the comparable period in the prior year, which includes the cumulative effect of accounting change of $23,332. LIQUIDITY AND CAPITAL RESOURCES BEA's primary requirements for working capital have been directly related to its accounts receivable and inventory levels, costs associated with the design and development of the MDDS and other products and scheduled interest payments on its indebtedness. BEA's working capital was $50,737, as of May 25, 1996, compared to $41,824 as of February 24, 1996. In January 1996 the Company amended its existing credit facilities by increasing the aggregate principal amount that may be borrowed thereunder to $100,000 (the "Bank Credit Facility"). The Bank Credit Facility consists of a $25,000 Reducing Revolver and a $75,000 Revolving Facility. At May 25, 1996 indebtedness in an aggregate principal amount of approximately $38,000,000, plus letters of credit amounting to approximately $6,000,000, were outstanding under the Bank Credit Facility. The Company's liquidity requirements consist primarily of working capital needs and scheduled payments of interest on its indebtedness and costs associated with integrating Burns. The Company believes that cash flow from operations and availability under the Bank Credit Facility provide adequate funds for its working capital needs, planned capital expenditures and debt service obligations through the term of the Bank Credit Facility, which expires in January, 2001. The Company believes that it will be able to refinance its indebtedness prior to its maturity, although there can be no assurance that it will be able to do so. The Company's ability to fund its operations and make planned capital expenditures, to make scheduled payments and to refinance its indebtedness depends on its future operating performance and cash flow, which, in turn, are subject to prevailing economic conditions and to financial, business and other factors, some of which are beyond its control. This report includes forward-looking statements which involve risks and uncertainties. The Company's actual experience may differ materially from that discussed above. Factors that might cause such a difference include, but are not limited to, those discussed in "Risk Factors" in the Company's Registration Statement on Form S-4 dated April 3, 1996, the Company's Form 10-K for the year ended February 24, 1996, as well as future events that have the effect of reducing the Company's available cash balances, such as unexpected operating losses or delays in the integration of the Company's seating business or the delivery of the MDDS interactive video system or capital expenditures or cash expenditures related to possible future acquisitions. BE AEROSPACE, INC. PART II -- OTHER INFORMATION
Item 1. Legal Proceedings Not applicable. Item 2. Changes in Securities Not applicable. Item 3. Defaults Upon Senior Securities Not applicable. Item 4. Submission of Matters to a Vote of Security Holders Not applicable. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K a. Exhibits. None
BE AEROSPACE, INC. SIGNATURES 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. BE AEROSPACE, INC. Date: June 21, 1996 By: /s/ Robert J. Khoury ---------------------------- Robert J. Khoury Vice Chairman and Chief Executive Officer Date: June 21, 1996 By: /s/ Thomas P. McCaffrey ----------------------- Thomas P. McCaffrey Vice President & Chief Financial Officer EX-27 2 ARTICLE 5 FDS FOR 1ST QUARTER
5 3-MOS FEB-22-1997 MAY-25-1996 6,151 0 68,579 (5,156) 72,645 150,688 113,920 (30,002) 428,925 99,951 272,104 0 0 165 45,792 428,925 97,302 97,302 64,755 88,775 0 0 6,935 1,592 159 1,433 0 0 0 1,433 .08 .08
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