Third Quarter EPS of $.33 Per Share Reported by First Aviation

WESTPORT, Conn., Nov. 8, 2012 /PRNewswire/ -- First Aviation Services Inc. (OTC PINK: FAVS) today released reviewed financial statements for the third quarter ended September 30, 2012.

Net income available to common stockholders for the quarter was $319 thousand with basic earnings per share of $.33 versus net income of $445 thousand or earnings per share of $.46 in the prior year quarter.  Income from operations for the quarter decreased by 4.7% over the prior year period to $873 thousand on 22.5% lower sales.  Gross margin year to date was 25.2% which compares favorably to the prior year of 21.2% and largely reflects an improved mix of business.

First Aviation continues to improve its balance sheet.  For the first nine months the Company reduced outstanding bank debt and accounts payable by $9.8 million.  Book value per share as of September 30, 2012 was $21.49.

Aaron Hollander, Chairman and CEO, said: "We are seeing continued strength in the MRO side of our business and increased interest from our customers in our supply chain programs.  Our recently opened state of the art facility in Winston-Salem, NC, will allow us to continue to expand our market in the military and regional propeller market."

 

First Aviation Services Inc.
















Consolidated Condensed Statements of Operations
















(in thousands, except share and per share amounts)















12 Mos Ended







Three Mos Ended Sept 30,


Nine Mos Ended Sept 30,


Dec 31, 







2012


2011


2012


2011


2011*







(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)


















Net sales




$        23,100


$        29,807


$        70,575


$        87,556


$      113,056

Cost of sales



(17,285)


(23,502)


(53,304)


(68,807)


(88,635)
















Gross profit



5,815


6,305


17,271


18,749


24,421
















Selling, general and administrative expenses


4,516


5,048


14,610


15,736


21,248

Corporate expenses


426


341


1,214


1,123


1,500







4,942


5,389


15,824


16,859


22,748
















Income from operations


873


916


1,447


1,890


1,673
















Non-operating income (expense)












Interest income and other, net


-


(28)


12


(46)


-


Interest expense


(431)


(330)


(1,084)


(1,058)


(1,405)


Other income and expenses


(23)


7


(39)


707


718
















Income before income taxes


419


565


336


1,493


986

Income tax provision


(26)


(56)


(98)


(265)


(195)
















Net income



393


509


238


1228


791

Dividends on preferred stock


(74)


(64)


(214)


(184)


(251)
















Income available to common stockholders


$             319


$             445


$              24


$          1,044


$             540































Basic net income per share, and net income












per share - assuming dilution:


























Basic net income per share


$            0.33


$            0.46


$            0.02


$            1.23


$            0.62
















Net income per share - assuming dilution


$            0.33


$            0.46


$            0.02


$            1.23


$            0.62
















Weighted average shares outstanding - basic


969,072


958,124


965,091


846,144


874,644
















Weighted average shares outstanding - assuming dilution


969,072


958,370


965,091


846,871


875,349



































* Derived from Audited Consolidated Financial Statements










Please see our forward looking statements at www.firstaviation.com/forward

First Aviation Services Inc.












Consolidated Condensed Balance Sheets


(in thousands, except share amounts)


















Sept 30, 2012


Dec 31, 2011*


Sept 30, 2011







(Unaudited)




(Unaudited)

Assets









Current assets:








Cash and cash equivalents


$          1,116


$         1,112


$          1,181


Trade receivables, net


14,777


17,679


20,820


Inventories, net


27,503


31,411


31,999


Prepaid expenses and other


2,390


1,843


2,139

Total current assets


45,786


52,045


56,139












Plant and equipment, net


1,671


1,830


1,948

Deferred financing costs and other


358


477


443

Goodwill




7,773


7,773


7,773












Total assets



$        55,588


$       62,125


$        66,303























Liabilities and stockholders' equity







Current liabilities:








Accounts payable


$          9,622


$       16,178


$        17,478


Accrued compensation and related expenses


537


424


487


Other accrued liabilities


860


1,276


2,422


Revolving line of credit


14,400


16,985


18,130


Term loan payable


5,200


1,200


600


Notes payable


11


9


-

Total current liabilities


30,630


36,072


39,117












Long-term liabilities:








Other liabilities


1,525


1,431


1,589


Term loan payable


-


4,600


5,200


Subordinated debt


2,596


-


-

Total liabilities


34,751


42,103


45,906












Stockholders' equity








Class A Common stock, $0.20 par value, 1,000,000 shares authorized,









733,648, 733,648 and 733,644 shares issued, respectively, 









681,068, 671,994 and 670,064 shares outstanding, respectively


125


125


125


Class B Common stock, $0.20 par value, 300,000 shares authorized









288,333, 288,333 and 288,333 shares issued









and outstanding, respectively


58


58


58


Preferred stock, $0.01 par value, $100 redemption value, 30,000









shares authorized, 20,494, 18,354 and 17,685 shares issued









and outstanding, respectively


2,049


1,835


1,768


Additional paid-in capital


41,610


41,960


42,167


Deficit




(18,157)


(18,181)


(17,677)


Accumulated other comprehensive income


462


433


391







26,147


26,230


26,832


Less:  treasury stock, at cost, 52,580, 61,654 and 63,580 









shares, respectively


(5,310)


(6,208)


(6,435)

Total stockholders' equity


20,837


20,022


20,397












Total liabilities and stockholders' equity


$        55,588


$       62,125


$        66,303























* Derived from Audited Consolidated Financial Statements












Please see our forward looking statements at www.firstaviation.com/forward

 

First Aviation Services Inc.
















Consolidated Statements of Cash Flows
















(in thousands)















12 Mos Ended







Three Months Ended Sept 30,


Nine Months Ended Sept 30,


Dec 31,







2012


2011


2012


2011


2011*







(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)


















Cash flows from operating activities











Net income



$             393


$             509


$             238


$          1,228


$             791

Adjustments to reconcile net income to net cash












provided by (used in) operating activities













Depreciation and amortization


279


319


896


939


1,160



Equity based compensation


15


28


53


73


93



Provision for bad debts


236


52


394


188


338



Provision for excess and obsolete inventory


-


-


-


(36)


236



Accreted debt discount


78


-


91


-


-



Change in working capital assets/liabilities:














Trade receivables


(1,112)


(567)


2,508


(957)


2,012




Inventories


491


1,012


3,936


2,707


3,109




Prepaid expenses and other


(177)


516


(556)


278


574




Accounts payable


950


(3,250)


(6,556)


(1,299)


(2,621)




Accrued compensation and related expenses,














   and other accrued liabilities


9


(906)


(303)


(1,033)


(2,242)
















Net cash provided by (used in) operating activities


1,162


(2,287)


701


2,088


3,450
















Cash flows from investing activities











Purchases of plant and equipment and other assets


(344)


(71)


(556)


(222)


(345)

Net cash used in investing activities


(344)


(71)


(556)


(222)


(345)
















Cash flows from financing activities











Net change in revolving iine of credit



(135)


(1,319)


(2,585)


(4,127)


(5,272)

Loan costs



(2)


(10)


(13)


(103)


(118)

Repayments on term loan



(600)


-


(600)


(600)


(600)

Proceeds from subordinate debt issuance



-


-


3,000


-


-

Repayments on notes payable and other additions



1


(174)


96


(156)


(305)

Issuance of Class A Common Stock



-


-


-


3,000


3,001

Net cash (used in) provided by financing activities



(736)


(1,503)


(102)


(1,986)


(3,294)
















Effect of exchange rate changes on cash and cash












equivalents


2


(2)


1


(1)


(1)
















Net change in cash and cash equivalents


84


(3,863)


44


(121)


(190)

Cash and cash equivalents at the beginning of the period


1,032


5,044


1,112


1,302


1,302

Cash and cash equivalents at the end of the period


$          1,116


$          1,181


$          1,156


$          1,181


$          1,112
















Supplemental cash flow disclosures











Cash paid for:












Interest



$             236


$             249


$             748


$             831


$          1,126


Income taxes paid, net


$              15


$              11


$              76


$              71


$              75




















* Derived from Audited Consolidated Financial Statements









Please see our forward looking statements at www.firstaviation.com/forward
















First Aviation Services Inc., ("FAvS") located in Westport, Connecticut, through its principal operating subsidiaries Aerospace Products International, Inc., ("API") based in Memphis, TN, Aerospace Turbine Rotables, Inc. ("AeTR") in Wichita, KS, and Piedmont Propulsion Systems, LLC ("PPS") in Winston-Salem, NC is a leading provider of services to the aviation industry worldwide.  With locations in the U.S., Canada, Asia Pacific and China plus partners throughout the world, FAvS is a leading provider of aviation products, supply chain management services, repair and overhaul and technology solutions to the industry.

More information about FAvS and its subsidiaries may be found on the company's website, www.firstaviation.com.   Please see our forward looking statements at www.firstaviation.com/forward.

Contact:          James G. Howell II
                        Chief Financial Officer
                        First Aviation Services Inc.
                        (901) 259-4502

SOURCE First Aviation Services Inc.



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