Sypris Reports Second Quarter Results
Revenue and Margins Post Solid Growth on Strong Industrial Performance
HIGHLIGHTS
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For the Second Quarter:
-
Consolidated revenue increased 13% to
$93.1 million from the second quarter of 2013. -
Gross profit increased 30% to
$10.8 million from the second quarter of 2013. - Gross margin expanded 150 basis points from the prior year to 11.6%.
-
Earnings improved to
$0.02 per diluted share, compared to a loss of $0.08 per share for the prior year period. -
Revenue, gross profit and gross margin for the
Industrial Group increased 12%, 29% and 170 basis points, respectively, from the second quarter of 2013.
For the Six Months:
-
Consolidated revenue increased 10% to
$177.4 million from the first half of 2013 and increased 18% sequentially from the second half of 2013. -
Gross profit increased 30% to
$21.4 million from the first half of 2013 and increased 57% sequentially from the second half of 2013. - Gross margin expanded 190 basis points from the prior year to 12.1%.
-
Earnings improved to
$0.10 per diluted share, compared to a loss of $0.41 per share for the prior year period. -
Revenue, gross profit and gross margin for the
Industrial Group increased 10%, 33% and 240 basis points, respectively, from the first half of 2013.
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The Company reported revenue of
For the six months ended June 29, 2014, the Company reported revenue of
“Our
“Our Aerospace and Defense business continued its efforts to diversify
its portfolio of products and services in response to the challenges
posed by the U.S. defense industry. Our team continues to make progress
on the development of a
Revenue for our
Revenue for our
Outlook
Mr. Gill added, “We will continue to concentrate on the daily execution
within both of our businesses. Within our
Forward Looking Statements
This press release contains “forward-looking” statements within
the meaning of the federal securities laws. Each forward-looking
statement herein is subject to risks and uncertainties, as detailed in
our most recent Form 10-K and Form 10-Q and other
SYPRIS SOLUTIONS, INC. | |||||||||
Financial Highlights | |||||||||
(In thousands, except per share amounts) | |||||||||
Three Months Ended | |||||||||
June 29, | June 30, | ||||||||
2014 | 2013 | ||||||||
(Unaudited) | |||||||||
Revenue | $ | 93,113 | $ | 82,166 | |||||
Net income (loss) | $ | 370 | $ | (1,494 | ) | ||||
Income (loss) per common share: | |||||||||
Basic | $ | 0.02 | $ | (0.08 | ) | ||||
Diluted | $ | 0.02 | $ | (0.08 | ) | ||||
Weighted average shares outstanding: | |||||||||
Basic | 19,622 | 19,347 | |||||||
Diluted | 19,682 | 19,347 | |||||||
Six Months Ended | |||||||||
June 29, | June 30, | ||||||||
2014 | 2013 | ||||||||
(Unaudited) | |||||||||
Revenue | $ | 177,357 | $ | 160,577 | |||||
Net income (loss) | $ | 2,022 | $ | (7,953 | ) | ||||
Income (loss) per common share: | |||||||||
Basic | $ | 0.10 | $ | (0.41 | ) | ||||
Diluted | $ | 0.10 | $ | (0.41 | ) | ||||
Weighted average shares outstanding: | |||||||||
Basic | 19,525 | 19,255 | |||||||
Diluted | 19,566 | 19,255 |
Sypris Solutions, Inc. | ||||||||||||||||||||
Consolidated Statements of Operations | ||||||||||||||||||||
(in thousands, except for per share data) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 29, | June 30, | June 29, | June 30, | |||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||||||
Net revenue: | ||||||||||||||||||||
Industrial Group | $ | 83,710 | $ | 74,432 | $ | 159,549 | $ | 145,581 | ||||||||||||
Electronics Group | 9,403 | 7,734 | 17,808 | 14,996 | ||||||||||||||||
Total net revenue | 93,113 | 82,166 | 177,357 | 160,577 | ||||||||||||||||
Cost of sales: | ||||||||||||||||||||
Industrial Group | 72,327 | 65,574 | 137,012 | 128,613 | ||||||||||||||||
Electronics Group | 9,959 | 8,256 | 18,954 | 15,552 | ||||||||||||||||
Total cost of sales | 82,286 | 73,830 | 155,966 | 144,165 | ||||||||||||||||
Gross profit (loss): | ||||||||||||||||||||
Industrial Group | 11,383 | 8,858 | 22,537 | 16,968 | ||||||||||||||||
Electronics Group | (556 | ) | (522 | ) | (1,146 | ) | (556 | ) | ||||||||||||
Total gross profit | 10,827 | 8,336 | 21,391 | 16,412 | ||||||||||||||||
Selling, general and administrative | 9,141 | 7,598 | 17,133 | 14,756 | ||||||||||||||||
Research and development | 10 | 1,419 | 161 | 2,296 | ||||||||||||||||
Amortization of intangible assets | - | 8 | - | 30 | ||||||||||||||||
Impairment of goodwill | - | - | - | 6,900 | ||||||||||||||||
Operating income (loss) | 1,676 | (689 | ) | 4,097 | (7,570 | ) | ||||||||||||||
Interest expense, net | 155 | 120 | 287 | 266 | ||||||||||||||||
Other expense (income), net | 75 | (259 | ) | (453 | ) | (1,454 | ) | |||||||||||||
Income (loss) before taxes | 1,446 | (550 | ) | 4,263 | (6,382 | ) | ||||||||||||||
Income tax expense, net | 1,076 | 944 | 2,241 | 1,571 | ||||||||||||||||
Net income (loss) | $ | 370 | $ | (1,494 | ) | $ | 2,022 | $ | (7,953 | ) | ||||||||||
Income (loss) per common share | ||||||||||||||||||||
Basic | $ | 0.02 | $ | (0.08 | ) | $ | 0.10 | $ | (0.41 | ) | ||||||||||
Diluted | $ | 0.02 | $ | (0.08 | ) | $ | 0.10 | $ | (0.41 | ) | ||||||||||
Dividends declared per common share | $ | 0.02 | $ | 0.02 | $ | 0.04 | $ | 0.04 | ||||||||||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic | 19,622 | 19,347 | 19,525 | 19,255 | ||||||||||||||||
Diluted | 19,682 | 19,347 | 19,566 | 19,255 |
Sypris Solutions, Inc. | |||||||||
Consolidated Balance Sheets | |||||||||
(in thousands, except for share data) | |||||||||
June 29, | December 31, | ||||||||
2014 | 2013 | ||||||||
(Unaudited) | (Note) | ||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 18,420 | $ | 18,674 | |||||
Accounts receivable, net | 64,926 | 38,533 | |||||||
Inventory, net | 35,008 | 34,422 | |||||||
Other current assets | 4,553 | 5,403 | |||||||
Total current assets | 122,907 | 97,032 | |||||||
Property, plant and equipment, net | 42,331 | 44,683 | |||||||
Other assets | 4,634 | 4,568 | |||||||
Total assets | $ | 169,872 | $ | 146,283 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 60,870 | $ | 36,684 | |||||
Accrued liabilities | 23,259 | 23,806 | |||||||
Total current liabilities | 84,129 | 60,490 | |||||||
Long-term debt | 23,000 | 24,000 | |||||||
Other liabilities | 4,912 | 5,541 | |||||||
Total liabilities | 112,041 | 90,031 | |||||||
Stockholders’ equity: | |||||||||
Preferred stock, par value $0.01 per share, 975,150 shares authorized; no shares issued |
— | — | |||||||
Series A preferred stock, par value $0.01 per share, 24,850 shares authorized; no shares issued |
— | — | |||||||
Common stock, non-voting, par value $0.01 per share, 10,000,000 shares authorized; no shares issued |
— | — | |||||||
Common stock, par value $0.01 per share, 30,000,000 shares authorized; 20,612,779 shares issued and 20,542,297 outstanding in 2014 and 20,448,007 shares issued and 20,399,649 outstanding in 2013 |
206 | 204 | |||||||
Additional paid-in capital | 150,831 | 150,569 | |||||||
Retained deficit | (75,570 | ) | (76,786 | ) | |||||
Accumulated other comprehensive loss | (17,635 | ) | (17,734 | ) | |||||
Treasury stock, 70,482 and 48,358 shares in 2014 and 2013, respectively | (1 | ) | (1 | ) | |||||
Total stockholders’ equity | 57,831 | 56,252 | |||||||
Total liabilities and stockholders’ equity | $ | 169,872 | $ | 146,283 |
Sypris Solutions, Inc. | |||||||||
Consolidated Cash Flow Statements | |||||||||
(in thousands) | |||||||||
Six Months Ended | |||||||||
June 29, | June 30, | ||||||||
2014 | 2013 | ||||||||
(Unaudited) | |||||||||
Cash flows from operating activities: | |||||||||
Net income (loss) | $ | 2,022 | $ | (7,953 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||||
Depreciation and amortization | 5,396 | 6,168 | |||||||
Deferred income taxes | |||||||||
Stock-based compensation expense | 914 | 1,002 | |||||||
Deferred revenue recognized | (4,329 | ) | (4,000 | ) | |||||
Deferred loan costs recognized | 39 | 39 | |||||||
Gain on the sale of assets | (4 | ) | (1,682 | ) | |||||
Provision for excess and obsolete inventory | 445 | 926 | |||||||
Goodwill impairment | - | 6,900 | |||||||
Other noncash items | 81 | 472 | |||||||
Contributions to pension plans | (441 | ) | (217 | ) | |||||
Changes in operating assets and liabilities: | |||||||||
Accounts receivable | (26,343 | ) | (14,375 | ) | |||||
Inventory | (1,032 | ) | (5,121 | ) | |||||
Prepaid expenses and other assets | 755 | 931 | |||||||
Accounts payable | 23,581 | 16,101 | |||||||
Accrued and other liabilities | 3,593 | (144 | ) | ||||||
Net cash used in operating activities | 4,677 | (953 | ) | ||||||
Cash flows from investing activities: | |||||||||
Capital expenditures | (2,474 | ) | (1,526 | ) | |||||
Proceeds from sale of assets | 8 | 2,160 | |||||||
Net cash (used in) provided by investing activities | (2,466 | ) | 634 | ||||||
Cash flows from financing activities: | |||||||||
Net (payment) proceeds on Credit Facility | (1,000 | ) | 1,000 | ||||||
Common stock repurchases | (236 | ) | |||||||
Indirect repurchase of shares for minimum statutory tax withholdings | (419 | ) | (554 | ) | |||||
Cash dividends paid | (814 | ) | (400 | ) | |||||
Proceeds from issuance of common stock | 4 | - | |||||||
Net cash (used in) provided by financing activities | (2,465 | ) | 46 | ||||||
Net decrease in cash and cash equivalents | (254 | ) | (273 | ) | |||||
Cash and cash equivalents at beginning of period | 18,674 | 18,674 | |||||||
Cash and cash equivalents at end of period | $ | 18,420 | $ | 18,401 | |||||
Source:
Sypris Solutions, Inc.
Anthony C. Allen, 502-329-2000
Vice
President & Treasurer