Sypris Reports 2012 Results ─────────────────────
Margins and EPS Expand over Prior Year
HIGHLIGHTS
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For the Full Year:
-
Revenue increased to
$342 million . -
Gross profit increased 24% to
$44 million compared to the prior year. - Gross margin increased to 12.8%, up 230 basis points from the prior year.
-
Earnings per share from continuing operations increased 16% to
$0.50 per diluted share, up from$0.43 per diluted share in 2011. - The Company reinstated its common dividend in March of 2012.
- The Company was added to the Russell 2000 Index effective June of 2012.
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The Company reported revenue of
“Our
“However, with an estimated 70% of the vehicles on the road today being
of an age that is in excess of eight years, the eventual replacement
cycle is expected to be robust for an extended period of time. In the
interim, we believe that our improved cost profile and strong
operational performance, which resulted in an 80 basis point increase in
gross margin for our
“Our Aerospace and Defense business continues to be affected by
budgetary and funding uncertainties within the
“In the long-term, we will continue to invest in new products and programs to further improve the attractiveness of our business portfolio, with a specific emphasis on trusted solutions for identity management, cryptographic key distribution and cyber analytics. We believe that our product mix going forward should help us to maintain our margin in the face of what is likely to be lumpy revenue until the many macroeconomic and policy issues are successfully resolved.”
Consolidated income from continuing operations for the full year ended
December 31, 2012 included a foreign currency related loss of
$0.8 million, a gain of
The Company reported revenue of
Revenue for our
Revenue for our
Outlook
Mr. Gill added, “We will continue to concentrate on the daily execution
of our business. We expect recent investments in production cells and
automation by our
Each “forward-looking statement” herein is subject to serious
risks and should not be relied upon, as detailed in our most recent Form
10-K and Form 10-Q and subsequent
SYPRIS SOLUTIONS, INC. | ||||||||
Financial Highlights | ||||||||
(In thousands, except per share amounts) | ||||||||
Three Months Ended | ||||||||
December 31, | ||||||||
2012 | 2011 | |||||||
(Unaudited) | ||||||||
Revenue | $ | 67,466 | $ | 83,580 | ||||
Net (loss) income | $ | (940 | ) | $ | 1,323 | |||
Basic income (loss) per common share: | ||||||||
Continuing operations | $ | (0.04 | ) | $ | 0.07 | |||
Discontinued operations | (0.01 | ) | - | |||||
Net income per share | $ | (0.05 | ) | $ | 0.07 | |||
Diluted income (loss) per common share: | ||||||||
Continuing operations | $ | (0.04 | ) | $ | 0.07 | |||
Discontinued operations | (0.01 | ) | - | |||||
Net (loss) income per share | $ | (0.05 | ) | $ | 0.07 | |||
Weighted average shares outstanding: | ||||||||
Basic | 19,172 | 18,850 | ||||||
Diluted | 19,172 | 19,032 | ||||||
Years Ended | ||||||||
December 31, | ||||||||
2012 | 2011 | |||||||
(Unaudited) | (Note) | |||||||
Revenue | $ | 341,604 | $ | 335,625 | ||||
Net income | $ | 3,047 | $ | 7,907 | ||||
Basic income (loss) per common share: | ||||||||
Continuing operations | $ | 0.51 | $ | 0.43 | ||||
Discontinued operations | (0.38 | ) | (0.03 | ) | ||||
Net income per share | $ | 0.13 | $ | 0.40 | ||||
Diluted income (loss) per common share: | ||||||||
Continuing operations | $ | 0.50 | $ | 0.43 | ||||
Discontinued operations | (0.37 | ) | (0.03 | ) | ||||
Net income per share | $ | 0.13 | $ | 0.40 | ||||
Weighted average shares outstanding: | ||||||||
Basic | 19,050 | 18,823 | ||||||
Diluted | 19,415 | 19,008 | ||||||
Note: The selected data at December 31, 2011 has been derived from the audited consolidated financial statements at that date and does not include all information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements. |
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Sypris Solutions, Inc. | ||||||||||||||||
Consolidated Statements of Operations | ||||||||||||||||
(in thousands, except for per share data) | ||||||||||||||||
Three Months Ended | Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(Unaudited) | (Unaudited) | (Note) | ||||||||||||||
Net revenue: | ||||||||||||||||
Industrial Group | $ | 55,498 | $ | 72,223 | $ | 286,046 | $ | 273,305 | ||||||||
Electronics Group | 11,968 | 11,357 | 55,558 | 62,320 | ||||||||||||
Total net revenue | 67,466 | 83,580 | 341,604 | 335,625 | ||||||||||||
Cost of sales: | ||||||||||||||||
Industrial Group | 49,919 | 64,023 | 255,065 | 245,962 | ||||||||||||
Electronics Group | 8,909 | 10,850 | 42,790 | 54,434 | ||||||||||||
Total cost of sales | 58,828 | 74,873 | 297,855 | 300,396 | ||||||||||||
Gross profit: | ||||||||||||||||
Industrial Group | 5,579 | 8,200 | 30,981 | 27,343 | ||||||||||||
Electronics Group | 3,059 | 507 | 12,768 | 7,886 | ||||||||||||
Total gross profit | 8,638 | 8,707 | 43,749 | 35,229 | ||||||||||||
Selling, general and administrative | 7,871 | 7,410 | 30,797 | 28,315 | ||||||||||||
Research and development | 1,303 | 760 | 3,816 | 3,397 | ||||||||||||
Amortization of intangible assets | 23 | 22 | 89 | 102 | ||||||||||||
Nonrecurring (income) expense, net |
- | - | - | (3,000 | ) | |||||||||||
Restructuring expense, net | - | (2 | ) | - | 231 | |||||||||||
Operating income | (559 | ) | 517 | 9,047 | 6,184 | |||||||||||
Interest expense, net | 117 | 124 | 437 | 1,732 | ||||||||||||
(Gain) on sale of marketable securities | - | - | (1,850 | ) | - | |||||||||||
Other (income), net | (85 | ) | (621 | ) | (2,055 | ) | (6,604 | ) | ||||||||
(Loss) income from continuing operations before taxes | (591 | ) | 1,014 | 12,515 | 11,056 | |||||||||||
Income tax expense (benefit), net | 259 | (387 | ) | 2,248 | 2,621 | |||||||||||
(Loss) income from continuing operations | (850 | ) | 1,401 | 10,267 | 8,435 | |||||||||||
Loss from discontinued operations, net of tax | (90 | ) | (78 | ) | (7,220 | ) | (528 | ) | ||||||||
Net (loss) income | $ | (940 | ) | $ | 1,323 | $ | 3,047 | $ | 7,907 | |||||||
Basic income (loss) per share: | ||||||||||||||||
(Loss) income per share from continuing operations | $ | (0.04 | ) | $ | 0.07 | $ | 0.51 | $ | 0.43 | |||||||
Loss per share from discontinued operations | (0.01 | ) | - | (0.38 | ) | (0.03 | ) | |||||||||
Net (loss) income per share | $ | (0.05 | ) | $ | 0.07 | $ | 0.13 | $ | 0.40 | |||||||
Diluted income (loss) per share: | ||||||||||||||||
(Loss) income per share from continuing operations | $ | (0.04 | ) | $ | 0.07 | $ | 0.50 | $ | 0.43 | |||||||
Loss per share from discontinued operations | (0.01 | ) | - | (0.37 | ) | (0.03 | ) | |||||||||
Net (loss) income per share | $ | (0.05 | ) | $ | 0.07 | $ | 0.13 | $ | 0.40 | |||||||
Dividends declared per common share | $ | 0.02 | $ | - | $ | 0.08 | $ | - | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 19,172 | 18,850 | 19,050 | 18,823 | ||||||||||||
Diluted | 19,172 | 19,032 | 19,415 | 19,008 | ||||||||||||
Note: The statement of operations at December 31, 2011 has been derived from the audited consolidated financial statements at that date but does not include all information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements. | ||||||||||||||||
Sypris Solutions, Inc. | ||||||||
Consolidated Balance Sheets | ||||||||
(in thousands, except for share data) | ||||||||
December 31, | December 31, | |||||||
2012 | 2011 | |||||||
(Unaudited) | (Note) | |||||||
ASSETS |
||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 18,664 | $ | 18,173 | ||||
Accounts receivable, net | 38,530 | 42,984 | ||||||
Inventory, net | 33,958 | 33,621 | ||||||
Other current assets | 4,946 | 3,468 | ||||||
Assets held for sale | — | 1,739 | ||||||
Total current assets | 96,098 | 99,985 | ||||||
Restricted cash | — | 3,000 | ||||||
Investment in marketable securities | — | 1,749 | ||||||
Property, plant and equipment, net | 53,050 | 56,891 | ||||||
Goodwill | 6,900 | 6,900 | ||||||
Other assets | 4,920 | 7,200 | ||||||
Total assets | $ | 160,968 | $ | 175,725 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 36,267 | $ | 51,303 | ||||
Accrued liabilities | 21,988 | 23,569 | ||||||
Total current liabilities | 58,255 | 74,872 | ||||||
Long-term debt | 19,000 | 10,000 | ||||||
Other liabilities | 20,780 | 30,385 | ||||||
Total liabilities | 98,035 | 115,257 | ||||||
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; 20,190,116 shares issued and 20,155,268 outstanding in 2012 and 20,108,635 shares issued and 19,995,401 outstanding in 2011 |
202 | 201 | ||||||
Additional paid-in capital | 149,576 | 149,160 | ||||||
Retained deficit | (65,282 | ) | (66,722 | ) | ||||
Accumulated other comprehensive loss | (21,562 | ) | (22,170 | ) | ||||
Treasury stock, 34,848 and 113,234 shares in 2012 and 2011, respectively | (1 | ) | (1 | ) | ||||
Total stockholders’ equity | 62,933 | 60,468 | ||||||
Total liabilities and stockholders’ equity | $ | 160,968 | $ | 175,725 | ||||
Note: The balance sheet at December 31, 2011 has been derived from the audited consolidated financial statements at that date but does not include all information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements. | ||||||||
Sypris Solutions, Inc. | ||||||||
Consolidated Cash Flow Statements | ||||||||
(in thousands) | ||||||||
Year Ended December 31, | ||||||||
2012 | 2011 | |||||||
(Unaudited) | (Note) | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 3,047 | $ | 7,907 | ||||
Loss from discontinued operations | (7,220 | ) | (528 | ) | ||||
Income from continuing operations | 10,267 | 8,435 | ||||||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: |
||||||||
Depreciation and amortization | 12,251 | 14,216 | ||||||
Deferred income taxes | 871 | 508 | ||||||
Gain on the sale of marketable securities | (1,850 | ) | — | |||||
Stock-based compensation expense | 1,826 | 979 | ||||||
Deferred revenue recognized | (7,892 | ) | (6,884 | ) | ||||
Deferred loan costs recognized | 78 | 172 | ||||||
Write-off of pre-contract costs | 1,113 | — | ||||||
Write-off of debt issuance costs | — | 277 | ||||||
Gain on the sale of assets | (2,590 | ) | (4,523 | ) | ||||
Provision for excess and obsolete inventory | 928 | 945 | ||||||
Other noncash items | 1,209 | (2,545 | ) | |||||
Contributions to pension plans | (1,598 | ) | (753 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | 4,307 | (1,509 | ) | |||||
Inventory | (1,191 | ) | (4,302 | ) | ||||
Prepaid expenses and other assets | (1,350 | ) | 564 | |||||
Accounts payable | (15,193 | ) | 11,747 | |||||
Accrued and other liabilities | (6,106 | ) | 100 | |||||
Net cash (used in) provided by operating activities | (4,920 | ) | 17,427 | |||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (7,082 | ) | (6,848 | ) | ||||
Proceeds from sale of marketable securities | 1,914 | — | ||||||
Proceeds from sale of assets | 4,595 | 5,032 | ||||||
Other | — | 33 | ||||||
Net cash used in investing activities | (573 | ) | (1,783 | ) | ||||
Cash flows from financing activities: | ||||||||
Repayment of former Revolving Credit Agreement | — | (10,000 | ) | |||||
Repayment of former Senior Notes | — | (13,305 | ) | |||||
Net proceeds from Credit Facility | 9,000 | 10,000 | ||||||
Payments for deferred loan costs | — | (387 | ) | |||||
Common stock repurchases | (660 | ) | — | |||||
Indirect repurchase of shares for minimum statutory tax withholdings | (750 | ) | (435 | ) | ||||
Cash dividends paid | (1,607 | ) | — | |||||
Proceeds from issuance of common stock | 1 | 64 | ||||||
Net cash provided by (used in) financing activities | 5,984 | (14,063 | ) | |||||
Net increase in cash and cash equivalents | 491 | 1,581 | ||||||
Cash and cash equivalents at beginning of period | 18,173 | 16,592 | ||||||
Cash and cash equivalents at end of period | $ | 18,664 | $ | 18,173 | ||||
Note: The cash flow statement at December 31, 2011 has been derived from the audited consolidated financial statements at that date but does not include all information and footnotes required by accounting principles generally accepted in the United States for a complete set of financial statements. | ||||||||
Source:
Sypris Solutions, Inc.
Brian A. Lutes, 502-329-2000
Chief
Financial Officer