CPI Aerostructures, Inc. (“CPI Aero
”) (NYSE MKT:CVU) today announced financial results for the 2013 fourth quarter and year ended December 31, 2013.
Fourth Quarter 2013 vs. Fourth Quarter 2012
Full Year 2013 vs. Full Year 2012
- Revenue was $21,285,992, compared to $27,356,029;
- Gross margin was 24.8%, compared to 28.1%;
- Pre-tax income was $3,376,242, compared to $5,765,354; and,
- Net income was $2,370,242, or $0.28 per diluted share, compared to $3,600,354, or $0.43 per diluted share.
* Diluted earnings per share for full year 2013 was calculated on 8% more shares outstanding, than in 2012 due to the Company’s 1.2 million share public offering completed in July 2012.
- Revenue was $82,988,522, compared to $89,272,582;
- Gross margin was 22.2%, compared to 27.1%;
- Pre-tax income was $11,153,894, compared to $16,525,130; and,
- Net income was $7,736,894, or $0.91 per diluted share, compared to $11,011,130, or $1.40 per diluted share.
Douglas J. McCrosson, CPI Aero’s recently appointed President & CEO, stated, “In February of last year, we provided guidance that uncertainties related to the Government sequester would result in lower revenue and net income in 2013 as compared to 2012. It was our expectation at the time that revenue and net income would more closely resemble 2011 results rather than 2012 results. Today’s announced results are in line with our expectation. The decrease in total revenue for 2013 as compared to 2012 was due to lower revenue from prime government contracts and subcontracts, offset by slightly higher revenues generated from commercial subcontracts. Specifically:
- Revenue generated from prime government contracts decreased to approximately $1.4 million. This decrease was expected as our largest prime contract with the Government, C-5 TOP, is virtually complete.
- Revenue generated from government subcontracts decreased by 2.7% to approximately $54.9 million. The decrease was largely due to a marked decline in our military fixed wing business segment offset by slight increases in the remaining three military markets segments; helicopter, maintenance, repair and overhaul (MRO) and pod systems.
- Revenue generated from commercial subcontracts slightly increased by 0.4% to approximately $26.8 million. The increase was largely due to growth in our business jet market segment, particularly in our programs with Cessna and Embraer that are both emerging from the development stage.”
Mr. McCrosson added, “As reported for the past two quarters, our gross margin for 2013 was affected primarily by adjustments to our long-term programs with Spirit, Northrop Grumman and Boeing. Additionally, in the 2013 fourth quarter we experienced technical challenges during the final assembly phase of the first pod system we are building for United Technologies Aerospace Systems. While such technical challenges are not uncommon during the first build of a highly complex system, the end result was the need for additional unplanned non-recurring expenditures for new tooling, engineering labor, and support labor costs that increased the estimated costs for this program. As a result, gross margin for the 2013 fourth quarter and year was 24.8% and 22.2%, respectively. The 2013 gross margin is 80 basis points lower than the low end of our 2013 gross margin guidance provided in our third quarter 2013 earnings release.”