TIMCO Aviation Services, Inc. Announces Second Quarter 2004 Results
August 16 2004 - 7:18PM
PR Newswire (US)
TIMCO Aviation Services, Inc. Announces Second Quarter 2004 Results
GREENSBORO, N.C., Aug. 16 /PRNewswire-FirstCall/ -- TIMCO Aviation
Services, Inc. (OTC:TMAS) (BULLETIN BOARD: TMAS) today announced
its results of operations for the 2004 second quarter. Revenue for
the three months ended June 30, 2004 was $78.2 million, compared to
$52.1 million for the second quarter of 2003, an increase of 50%.
Net loss from continuing operations was $0.4 million for the 2004
second quarter compared to a net loss of $2.9 million for the
comparable 2003 period. Net loss from continuing operations for the
second quarter of 2004 benefited from a gain on the settlement of a
warrant obligation of $0.2 million. Net loss from continuing
operations for second quarter of 2003 benefited from the
elimination and reduction of accruals aggregating $0.6 million and
from a tax benefit of $0.7 million. Without these benefits, the net
loss from continuing operations for the 2004 and 2003 second
quarter would have been $0.6 million and $4.2 million,
respectively. Management believes that comparison of its 2004 and
2003 second quarter net loss without the effect of the above-
described items provides a useful measure for investors to compare
the Company's period-to-period results of operations. After
accounting for income from discontinued operations, net loss for
the second quarter of 2004 was $248,000 ($0.01 per basic and
diluted share), compared to a net loss of $27,000 ($0.00 per basic
share and diluted share) for the 2003 second quarter. Revenue for
the six months ended June 30, 2004 was $161.5 million, compared to
$103.4 million for the first half of 2003, an increase of 56%. Net
loss from continuing operations was $1.2 million for the 2004 first
half, compared to a net loss of $2.9 million for the comparable
2003 period. Net loss from continuing operations for the first half
of 2004 benefited from a gain on the settlement of a warrant
obligation of $0.2 million. Net loss from continuing operations for
the first half of 2003 benefited from the elimination and reduction
of accruals aggregating $1.2 million and from a tax benefit of $0.9
million. Without these benefits, the net loss from continuing
operations for the 2004 and 2003 first half would have been $1.4
million and $5.0 million, respectively. Management believes that
comparison of its 2004 and 2003 first half net loss without the
effect of the above-described items provides a useful measure for
investors to compare the Company's period-to- period results of
operations. After accounting for income from discontinued
operations, net loss for the first half of 2004 was $130,000 ($0.00
per basic share and diluted share), compared to a net income of
$292,000 ($0.01 per basic and diluted share) for the 2003 first
half. Roy T. Rimmer, Jr., the Company's Chairman and Chief
Executive Officer, stated: "Second quarter results highlight
continued progress at TIMCO. Our efforts to grow and satisfy our
customer base are reflected in our 50% quarter-over-quarter revenue
growth. Our airframe maintenance, engine maintenance, line
maintenance, engineering and interiors businesses have all had
substantial growth this year. We are working diligently toward
growing our customer base, increasing the level of services that we
provide to our customers and containing our costs. I very much
appreciate the hard work and dedication of all of TIMCO's
employees, whose collective efforts have made our progress
possible." Gil West, the Company's President and Chief Operating
Officer, stated: "We are gratified by the additional customer
commitments received in several of our businesses. While our
results for the first half of 2004 have been negatively impacted by
the startup costs associated with multiple lines of DC-10 work for
a major new customer, we continue to see a trend toward outsourced
aircraft maintenance as well as strong growth in our engineering
and interior related businesses." TIMCO Aviation Services, Inc. is
among the world's largest providers of fully integrated aviation
maintenance, repair and overhaul (MR&O) services for major
commercial airlines, regional air carriers, aircraft leasing
companies, government and military units and air cargo carriers.
The Company currently operates four MR&O businesses: TIMCO,
which, with its four active locations (Greensboro, NC, Macon, GA,
Lake City, FL and Goodyear, AZ), is one of the largest independent
providers of heavy aircraft maintenance services in the world;
Aircraft Interior Design and Brice Manufacturing, which specialize
in the refurbishment of aircraft interior components and the
manufacture and sale of aftermarket parts and new aircraft seats;
TIMCO Engineered Systems, which provides engineering services both
to our other MR&O operations and to our customers; and TIMCO
Engine Center, which refurbishes JT8D engines and performs on-wing
repairs for both JT8D and CFM-56 series engine. Visit TIMCO online
at http://www.timco.aero/ . This press release contains certain
forward-looking statements. Forward- looking statements involve
known and unknown risks and uncertainties, which may cause the
Company's actual results in future periods to differ materially
from forecasted results. A number of factors, including those
identified in the Company's Annual Report on Form 10-K for the year
ended December 31, 2003, its Quarterly Report on Form 10-Q for the
quarter ended June 30, 2004, and those identified below, could
adversely affect the Company's ability to obtain these results: the
Company's ability to continue to generate sufficient working
capital from operations to meet its operating requirements and
service its indebtedness, the Company maintaining good working
relationships with its vendors and customers, competitive pricing
for the Company's products and services, the Company's ability to
achieve gross margins at which it can be profitable, including
margins on services the Company performs on a fixed price basis,
competition in the aircraft maintenance, repair and overhaul
market, the Company's ability to attract and retain qualified
personnel in its business, utilization rates for the Company's
MR&O facilities, the Company's ability to integrate future
acquisitions, the Company's ability to effectively manage its
business, economic factors which affect the airline industry
generally and thereby affect our business (since our customer base
consists primarily of airlines and freight carriers), including the
amount of aircraft maintenance being outsourced, the price of jet
fuel and the ongoing war on terrorism, and changes in government
regulations. Copies of the Company's filings with the U.S.
Securities and Exchange Commission are available from the SEC or
may be obtained upon request from the Company. The Company does not
undertake any obligation to update the information contained
herein, which speaks only as of this date. TIMCO Aviation Services,
Inc. ($ thousands, except per share data) Three months ended Six
months ended June 30, June 30, 2004 2003 2004 2003 Operating
revenue $78,172 $52,112 $161,502 $103,396 Gross Profit 7,008 1,575
13,099 5,093 Gross Profit Percentage 9.0% 3.0% 8.1% 4.9% Operating
expenses (a) 5,608 3,721 10,907 6,671 Operating expenses as a % of
revenue (a) 7.2% 7.1% 6.8% 6.5% Income (loss) from operations (a)
1,400 (2,146) 2,192 (1,578) Loss from continuing operations (b)
(392) (2,905) (1,245) (2,883) Income, net, from discontinued
operations (c) 144 2,878 1,115 3,175 Net (loss) income $(248) $(27)
$(130) $292 Basic (loss) income per share $(0.01) $0.00 $0.00 $0.01
Diluted (loss) income per share $(0.01) $0.00 $0.00 $0.01 We are
providing the following information to allow what the Company
believes to be a meaningful comparison of its period-to-period
results. (a) 2003 second quarter and first half operating expenses
benefited from the elimination of accruals aggregating $564 and
$1,264, respectively. Without the impact of these items, operating
expenses for the 2003 second quarter and first half would have been
$4,285 (8.2% of revenues) and $7,935 (7.7% of revenues),
respectively, and the loss from operations would have been ($2,710)
and ($2,842), respectively. (b) Income from continuing operations
for the 2004 second quarter and first half included a gain on the
settlement of a warrant obligation of $209. Income from continuing
operations in the second quarter and first half of 2003 included
income tax benefits of $710 and $884, respectively. Without the
benefit of these items and of the items described in (a) above, the
loss from continuing operations for the second quarter of 2004 and
2003 would have been ($601) and ($4,179), respectively, and the
loss from continuing operations for the first half of 2004 and 2003
would have been ($1,454) and ($5,031), respectively. (c) Income,
net, from discontinued operations reflects the gain on, the
collection of receivables and the sale of inventory from
discontinued operations. The Company's manufacturing,
redistribution and new parts operations were sold in fiscal 2000
and the process of collection on the assets from these discontinued
operations is winding down. As a result, income from discontinued
operations is not expected to be significant in future periods.
Income, net from discontinued operations for the six months ended
June 30, 2004 included an $825 benefit from the sale of our Miramar
facility and a $2,700 benefit from the elimination and settlement
of contingency exposures and reserves relating to discontinued
operations in the three and six month periods ended June 30, 2003.
DATASOURCE: TIMCO Aviation Services, Inc. CONTACT: Roy T. Rimmer,
Jr., Chairman & Chief Executive Officer, or C. Robert Campbell,
Executive Vice President & Chief Financial Officer, of TIMCO
Aviation Services, Inc., +1-336-668-4410 Web site:
http://www.timco.aero/
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