- Revenue increased 28.5% to $21,340,831 from $16,607,638;
- Gross margin was 27.2% as compared to 25.1%;
- Pre-tax income increased 59.0% to $4,025,437, compared to $2,531,042; and,
- Net income increased 54.9% to $2,795,437, or $0.33 per diluted share, compared to $1,805,042, or $0.25 per diluted share.
- Revenue increased 23.7% to $61,916,552 from $50,043,470;
- Gross margin was 26.7% as compared to 24.5%;
- Pre-tax income increased 62.1% to $10,759,775, compared to $6,637,907; and,
- Net income increased 56.2% to $7,410,775 or $0.96 per diluted share, compared to $4,743,907 or $0.66 per diluted share.
“Our selling, general and administrative expenses as a percent of revenue for the third quarter and nine months decreased to 7.6% and 8.6%, respectively, as compared to 9.2% and 10.8%, respectively, in the same periods of last year, mainly due to changes we implemented earlier this year in our policy of issuing stock options to our board of directors.”Mr. Fred added, “As of November 7, 2012, we received approximately $68.9 million of new contract awards, of which approximately $63.0 million was for government subcontract awards, as compared to a total of $81.5 million of new contract awards, of all types, in the same period last year.” Included in new contract awards are:
- A $12.7 million purchase order from Boeing for assemblies on the A-10 aircraft.
- A $10.7 million order from Goodrich Corporation to supply structural aerospace assemblies; for the first time in CPI Aero’s history, this contract gives the Company the authority to design modifications to the structure it is manufacturing.
- An $18.8 million long-term agreement with Sikorsky to manufacture gunner window assemblies for the BLACK HAWK helicopter.
- A $5 million initial order as part of an approximately $41 million long-term contract with Cessna to supply structural assemblies, predominately wing spars, for the Citation X aircraft.
Discussing the outlook for 2013, Mr. Fred added, “As is the case for our industry peers, it remains unclear whether sequestration will take effect in January 2013 and what the impact of even deeper cuts in defense spending will have on CPI Aero’s existing and projected defense contracts. We plan to announce our 2013 guidance once the federal budget situation becomes sufficiently defined.”Mr. Fred concluded, “Finally, to support our continued growth, this summer we raised approximately $13.5 million through a public offering, which has given us greater financial flexibility. We used $4 million of the net proceeds to repay a portion our revolver and as of September 30, 2012, we have credit lines in place with a combined borrowing capacity of $22.5 million.” Conference Call CPI Aero’s President and CEO, Edward J. Fred, and CFO, Vincent Palazzolo, will host a conference call today, Friday, November 9, 2012 at 10:00 am ET to discuss third 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 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, the A-10 Thunderbolt attack jet, the Gulfstream G650, the UH-60 BLACK HAWK helicopter, the S-92® helicopter, the MH-60S mine countermeasure helicopter, AH-1Z ZULU attack helicopter, the HondaJet-Advanced Light Jet, the MH-53 and CH-53 variant helicopters, the C-5A Galaxy cargo jet, and the E-3 Sentry AWACS jet. CPI Aero is included in the Russell 2000® 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, 2011 and Forms 10-Q for the quarters ended March 31, 2012 and June 30, 2012.CPI Aero ® is a registered trademark of CPI Aerostructures, Inc.
|CPI AEROSTRUCTURES, INC. CONDENSED STATEMENTS OF INCOME|
|For the Three Months Ended September 30,||For the Nine Months Ended September 30,|
|Cost of Sales||15,536,407||12,440,033||45,379,099||37,780,959|
|Selling, general and administrative expenses||1,615,888||1,525,386||5,290,999||5,408,273|
|Income from operations||4,188,536||2,642,219||11,246,454||6,854,238|
|Income before provision for income taxes||4,025,437||2,531,042||10,759,775||6,637,907|
|Provision for income taxes||1,230,000||726,000||3,349,000||1,894,000|
|Change in unrealized gain (loss) - interest rate swap||(1,490||)||5,732||(33,836||)||17,000|
|Earnings per common share – basic||$||0.33||$||0.26||$||0.99||$||0.69|
|Earnings per common share – diluted||$||0.33||$||0.25||$||0.96||$||0.66|
|Shares used in computing earnings per common share:|
|CPI AEROSTRUCTURES, INC. CONDENSED BALANCE SHEETS|
|September 30,||December 31,|
|Cash||$ 1,072,107||$ 878,200|
|Accounts receivable, net||8,858,740||4,285,570|
|Costs and estimated earnings in excess of billings on uncompleted contracts||96,208,681||79,010,362|
|Deferred income taxes||257,000||257,000|
|Prepaid expenses and other current assets||397,637||662,326|
|Total current assets||106,794,165||85,093,458|
|Plant and equipment, net||2,956,666||2,629,569|
|Deferred income taxes||1,159,000||1,105,000|
|Total Assets||$ 111,017,911||$ 88,940,107|
|LIABILITIES AND SHAREHOLDERS’ EQUITY|
|Accounts payable||$ 8,897,673||$ 11,998,244|
|Current portion of long-term debt||1,724,265||887,380|
|Line of credit||16,600,000||16,100,000|
|Income taxes payable||1,723,292||2,802,000|
|Deferred income taxes||125,000||125,000|
|Total current liabilities||29,475,958||32,907,022|
|Long-term debt, net of current portion||3,581,970||889,239|
|Deferred income taxes||660,000||660,000|
|Common stock - $.001 par value, authorized 50,000,000 shares, issued 8,353,469 and 7,079,638 shares, respectively, and outstanding 8,353,469 and 6,946,381 shares, respectively||8,353||7,080|
|Additional paid-in capital||49,525,930||35,346,273|
|Accumulated other comprehensive loss||(55,598)||(21,772)|
|Treasury stock, 0 and 133,257 shares, respectively (at cost)||----||(1,140,226)|
|Total Shareholders’ Equity||76,724,312||54,026,207|
|Total Liabilities and Shareholders’ Equity||$ 111,017,911||$ 88,940,107|