CPI Aerostructures, Inc. (“CPI Aero ®”) (NYSE Amex: CVU) today announced record results for the 2011 second quarter and six months ended June 30, 2011. Second Quarter 2011 vs. 2010
- Revenue increased 38.9% to $17,426,223 from $12,544,625;
- Gross margin was 24.4% compared to 26.7%;
- Pre-tax income increased 14.7% to $2,094,816 compared to $1,826,254; and,
- Net income increased 30.3% to $1,570,816 or $0.22 per diluted share, compared to $1,205,254, or $0.18 per diluted share.
- Revenue increased 42.0% to $33,435,831 from $23,550,154;
- Gross margin was 24.2% compared to 25.9%;
- Pre-tax income increased 31.2% to $4,106,865 compared to $3,130,068;
- Net income increased 42.2% to $2,938,865 or $0.41 per diluted share compared to $2,066,068 or $0.32 per diluted share; and,
- Unawarded solicitations remain at a high level with open solicitations totaling a maximum realizable value of approximately $446 million.
Mr. Fred added, “As of June 30, 2011, new contract awards totaled $58.6 million, which included approximately $8.8 million of government prime contract awards, approximately $19.9 million of government subcontract awards and approximately $29.9 million of commercial subcontract awards, compared to a total of $31.1 million of new contract awards, of all types, in the same period last year, and $61.7 million for all of 2010.”Included in recent contract awards are several large orders from existing customers:
- The exercise of options, by Northrop Grumman Corporation under a previously awarded purchase order for Outer Wing Panel Kits for the E-2D Hawkeye and the C-2A Greyhound aircraft. The new orders, valued at $11.2 million, increased the firm, funded requirements under this program to approximately $35.9 million.
- An $8.3 million award from Spirit AeroSystems for work on wing leading edge assemblies for the Gulfstream G650 aircraft.
- A $2.85 million award to provide structural assemblies to Sikorsky Aircraft for use as spares for its BLACK HAWK military helicopter.
- In May, we amended our credit agreement with Sovereign Bank from an aggregate of $4,000,000 to an aggregate of $10,000,000 and extended the term to August 2014.
- Additionally, we are gearing up for a move to a 171,000 square feet facility which is nearly three times larger than our current facility.
- We have also increased employee count to enable us to meet customer delivery schedules.”
“However, because of this award delay that pushes revenue into 2012, and the strong year we have had to date in receiving new orders, we are pleased to be able to raise 2012 guidance to the following: we expect that revenue should be in the range of $95 million to $98 million, with a resulting net income in the range of $12 million to $13 million.”He concluded, “As a final piece of the guidance discussion, we expect third quarter revenue for 2011 to be the lowest revenue quarter of the year, while the fourth quarter will be the highest revenue quarter in CPI Aero’s history, and by a significant margin. While we don’t typically issue quarterly guidance, we feel it is important to point out the revenue level expectations for these quarters, as the revenue timing is somewhat different than it has been historically. This is simply due to the timing of deliveries, and the requirement to purchase materials to coincide with these delivery schedules.” Conference Call CPI Aero’s President and CEO, Edward J. Fred, and CFO, Vincent Palazzolo, will host a conference call today, Tuesday, August 9, 2011 at 10:00 am ET to discuss second quarter results as well as recent corporate developments. After opening remarks, there will be a question and answer period. Interested parties may participate in the call by dialing (201) 493-6739. Please call in 10 minutes before the scheduled time and ask for the CPI Aero call. The conference call will also be broadcast live over the Internet. To listen to the live call, please go to www.cpiaero.com and click on the “Investor Relations” section, then click on “Event Calendar”. Please access the website 15 minutes prior to the call to download and install any necessary audio software. The conference call will be archived and can be accessed for approximately 90 days. We suggest listeners use Microsoft Explorer as their browser. About CPI Aero CPI Aero is engaged in the contract production of structural and other aircraft parts for leading prime defense contractors, the U.S. Air Force, and other branches of the armed forces. CPI Aero also acts as a subcontractor to prime aircraft manufacturers in the production of commercial aircraft parts. In conjunction with its assembly operations, CPI Aero provides engineering, technical and program management services. Among the key programs that CPI Aero supplies are the E-2D Advanced Hawkeye surveillance aircraft, MH-53 and CH-53 variant helicopters, the UH-60 BLACK HAWK helicopter, the S-92® helicopter, the MH-60S mine countermeasure helicopter, the Gulfstream G650, C-5A Galaxy cargo jet, the A-10 Thunderbolt attack jet, and the E-3 Sentry AWACS jet. CPI Aero is included in the Russell Microcap® Index.
The above statements include forward looking statements that involve risks and uncertainties, which are described from time to time in CPI Aero’s SEC reports, including CPI Aero’s Form 10-K for the year ended December 31, 2010 and Form 10-Q for the quarter ended March 31, 2011.CPI Aero ® is a registered trademark of CPI Aerostructures, Inc.
|CPI AEROSTRUCTURES, INC.|
|CONDENSED STATEMENTS OF INCOME|
|For the Three Months||For the Six Months|
|Ended June 30,||Ended June 30,|
|Cost of Sales||13,181,422||9,193,296||25,340,926||17,449,743|
|Selling, general and administrative expenses||2,082,464||1,484,741||3,882,887||2,870,368|
|Income from operations||2,162,337||1,866,588||4,212,018||3,230,043|
|Income before provision for income taxes||2,094,816||1,826,254||4,106,865||3,130,068|
|Provision for income taxes||524,000||621,000||1,168,000||1,064,000|
|Earnings per common share – basic||$||0.23||$||0.18||$||0.43||$||0.33|
|Earnings per common share – diluted||$||0.22||$||0.18||$||0.41||$||0.32|
|Shares used in computing earnings per common share:|
|CPI AEROSTRUCTURES, INC.|
|CONDENSED BALANCE SHEETS|
|June 30,||December 31,|
|Accounts receivable, net||4,445,461||6,152,544|
|Costs and estimated earnings in excess of billings on uncompleted contracts||60,881,222||47,165,166|
|Prepaid expenses and other current assets||619,029||606,369|
|Total current assets||66,615,437||54,747,455|
|Property and equipment, net||1,275,851||881,915|
|Deferred income taxes||941,000||668,000|
|LIABILITIES AND SHAREHOLDERS’ EQUITY|
|Current portion of long-term debt||819,416||685,008|
|Line of credit||7,800,000||800,000|
|Deferred income taxes||1,023,006||182,000|
|Income taxes payable||182,000||134,006|
|Total current liabilities||18,393,155||10,370,285|
|Long-term debt, net of current portion||1,009,537||1,190,097|
|Common stock - $.001 par value; authorized 50,000,000 shares,|
|issued 7,048,570 and 6,911,570 shares, respectively, and|
|outstanding 6,915,313 and 6,789,736 shares, respectively||7,049||6,912|
|Additional paid-in capital||35,063,276||33,272,237|
|Accumulated other comprehensive loss||(34,136||)||(45,404||)|
|Treasury stock, 133,257 and 121,834 shares, respectively (at cost)||(1,140,226||)||(981,226||)|
|Total Shareholders’ Equity||49,252,752||44,670,443|
|Total Liabilities and Shareholders’ Equity||$||68,861,601||$||56,457,187|