LMI Aerospace Announces Sales and Earnings For Q1 2006

First Quarter Net Income Increases 174 Percent From Prior Year

ST. LOUIS, May 10 /PRNewswire-FirstCall/ -- LMI Aerospace, Inc. (NASDAQ: LMIA), a leading provider of structural components, assemblies and kits to the aerospace, defense and technology industries, today announced increased sales and earnings for the first quarter of 2006 due to growth in its corporate and commercial aerospace businesses.

Net sales in the quarter ended March 31, 2006 were $29.2 million, up 21.7 percent from the $24.0 million reported in the quarter ended March 31, 2005. Net income for the first quarter of 2006 was $2.3 million or $0.27 per diluted share compared to $800,000 or $0.10 per diluted share for the first quarter of 2005.

"We continue to experience growth in sales and customer orders in each of our four market sectors," said Ronald Saks, president and Chief Executive Officer of LMI Aerospace. "A new military rotorcraft program began to contribute sales in the first quarter while production rate increases and new program awards are causing 2006 order backlog to grow in our commercial and corporate aircraft markets. Our booked backlog for delivery in 2006 as of March 31, 2006 was $80 million, up from $60 million for the comparable 2005 period. Total booked backlog at March 31, 2006 was $94 million, down from $96 million at March 31, 2005, largely because of changes in order practices at a large corporate aircraft customer."

Gross profit for the first quarter of 2006 was $8.3 million or 28.5 percent of sales, an increase from $5.2 million or 21.8 percent of sales in the first quarter of 2005. Higher sales volume and greater efficiencies provided by the aggressive use of lean manufacturing tactics accounted for this improvement. Selling, general and administrative expenses were $4.2 million in the first quarter of 2006, compared to $3.5 million in the first quarter of 2005. This increase was from higher professional fees and salary and wage costs, primarily due to additional staffing. Interest expense for the first quarter of 2006 and 2005 was $400,000.

"Anticipated additional growth in production rates in our commercial and corporate aircraft markets, a higher reorder rate in our laser technology business, and new military rotorcraft programs have given us better visibility of future demand for our products," said Saks. "As we progress through 2006, we expect added customer demand from the commercial aircraft market sector as production rate increases place more pressure on our OEM and Tier 1 customers to outsource additional components and assemblies for us to manufacture. We currently estimate full-year 2006 sales in a range of $130 million to $140 million. We have raised projections for 2006 gross margin to 27 to 29 percent and now expect selling, general and administrative expenses of $17.5 million to $18.0 million. In addition, we project 2006 net interest income of approximately $200,000 and an income tax rate in the range of 36.5 percent to 37.5 percent, excluding the effect of any potential research and development credits."

"Our strategy in 2006 is designed to successfully manage the projected sales growth, with particular emphasis on customer service and operational imperatives, including improved delivery and quality performance," Saks added. "We expect to make capital expenditures in 2006 of approximately $7 million, focused on replacement of older equipment and additional capacity for new and existing programs. We have expanded our work force by 20 percent during the last twelve months and continue to grow our supply chain. In order to meet the continuing challenges of globalization, we intend to become more efficient by further embracing lean manufacturing technology and improving our employees' skills through our LMI Academy training center. Our plant in Mexicali, Mexico, which opened in March, has added capacity and should improve our overall competitiveness."

LMI also announced it has been awarded multiyear contracts for Boeing Model 737 components from Spirit AeroSystems, Inc.'s Wichita Business Unit for $1.4 million annually and from Boeing and Mitsubishi Heavy Industries for $2.2 million annually.

LMI Aerospace announced recently the appointment of Judith W. Northup to its Board of Directors. Ms. Northup brings 26 years of aerospace industry experience to LMI Aerospace, most recently with Vought Aircraft Industries as Vice President and Chief Administrative Officer. "We are pleased to add Judy to our Board," Saks said. "Judy's responsibilities at Vought included the creation of facilities to support the Boeing 787 program, oversight of procurement, inventory and production control, human resources, and various financial positions. Her knowledge and experience in aerospace will enhance the value of our existing Board."

LMI Aerospace, Inc., is a leading provider of structural components, assemblies and kits to the aerospace, defense and technology industries. The company fabricates, machines, finishes and integrates formed, close tolerance aluminum and specialty alloy components and sheet metal products primarily for large commercial, corporate and military aircraft. LMI Aerospace, Inc., manufactures more than 30,000 products for integration into a variety of aircraft platforms manufactured by leading original equipment manufacturers and Tier 1 aerospace suppliers.

This news release includes forward-looking statements related to LMI Aerospace, Inc.'s, outlook for 2006, which are based on current management expectations. Such forward-looking statements are subject to various risks and uncertainties, many of which are beyond the control of LMI Aerospace, Inc. Actual results could differ materially from the forward-looking statements as a result, among other things, of the factors detailed from time to time in LMI Aerospace, Inc.'s, filings with the Securities and Exchange Commission. Please refer to the Risk Factors contained in the company's Annual Report on Form 10-K for the year ended December 31, 2005, for more details.


                               LMI Aerospace, Inc.
                           Consolidated Balance Sheets
             (Amounts in thousands, except share and per share data)

                                                  March 31,       December 31,
                                                     2006               2005
                                                 (Unaudited)
    Assets
    Current assets:
       Cash and cash equivalents                   $23,845               $35
       Trade accounts receivable - net of
        allowance of $252 at March 31, 2006
        and $244 at December 31, 2005               15,810            16,088
       Inventories                                  27,497            25,333
       Prepaid expenses and other current assets     1,105             1,205
       Deferred income  taxes                                                  1,610                          1,610
        Total  current  assets                                                        69,867                        44,271

              Property,  plant  and  equipment,  net                      18,072                        18,162
              Goodwill                                                                            6,349                          5,653
              Customer  Intangible  assets,  net                              3,047                          3,114
              Other  assets                                                                        754                              757

        Total  assets                                                                      $98,089                      $71,957

        Liabilities  and  stockholders'  equity
        Current  liabilities:
              Accounts  payable                                                          $6,343                        $7,407
              Accrued  expenses                                                            5,000                          6,077
              Current  installments  of  long  term
                debt  and  capital  lease  obligations                      1,424                          1,846
        Total  current  liabilities                                              12,767                        15,330

        Long-term  debt  and  capital  lease
          obligations,  less  current  installments                    2,328                        14,462
        Subordinated  debt                                                                    -                              1,000
        Deferred  income  taxes                                                        1,333                          1,333
        Total  long-term  liabilities                                            3,661                        16,795

        Stockholders'  equity:
              Common  stock,  $.02  par  value  per
                share;  authorized  28,000,000  shares;
                issued  11,558,531  shares  and  8,797,909
                shares  at  March  31,  2006  and  December  31,
                2005,  respectively                                                          231                              176
              Preferred  stock,  $.02  par  value
                per  share;  authorized  2,000,000  shares;
                none  issued  in  both  periods                                            -                                  -
              Additional  paid-in  capital                                      65,722                        26,307
              Treasury  stock,  at  cost,  420,032
                shares  at  March  31,  2006  and  433,972
                shares  at  December  31,  2005                                  (1,993)                      (2,059)
              Retained  earnings                                                        17,701                        15,408
        Total  stockholders'  equity                                            81,661                        39,832

        Total  liabilities  and  stockholders'  equity            98,089                        71,957



                                                              LMI  Aerospace,  Inc.
                                  Condensed  Consolidated  Statements  of  Operations
                          (Amounts  in  thousands,  except  share  and  per  share  data)

                                                                                                                Three  Months  Ended
                                                                                                                        March  31,
                                                                                                          2006                            2005
        Net  sales                                                                            $29,242                      $23,973
        Cost  of  sales                                                                      20,921                        18,752

        Gross  profit                                                                          8,321                          5,221

        Selling,  general  and  administrative  expenses          4,201                          3,453

              Income  from  operations                                                4,120                          1,768

        Other  income  (expense):
              Interest  expense,  net                                                    (427)                          (420)
              Other,  net                                                                                2                                  3

        Income  before  income  taxes                                              3,695                          1,351

        Provision  for  income  taxes                                              1,386                              507

        Net  income                                                                            $2,309                            $844

        Amounts  per  common  share:
        Net  income  per  common  share                                            $0.27                          $0.10

        Net  income  per  common  share  assuming  dilution        $0.27                          $0.10

        Weighted  average  common  shares  outstanding      8,547,398                  8,237,772

        Weighted  average  dilutive  common
          shares  outstanding                                                    8,670,549                  8,355,744
 

CONTACT: Ed Dickinson, Chief Financial Officer of LMI Aerospace, Inc.,
+1-636-916-2150




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