Aviall Reports 23 Percent EPS Increase for First Quarter

Apr 23, 2001, 01:00 ET from Aviall, Inc.

    DALLAS, April 23 /PRNewswire Interactive News Release/ -- Aviall, Inc.
 (NYSE:   AVL) today reported financial results for the first quarter of 2001.
 
     Highlights
     --  Earned $0.15 per share (diluted) versus $0.12 in Q1 2000
     --  Revenues grew 13% year-over-year despite minimal revenue to date from
         the phase-in of the new Honeywell fuel control contract
     --  Total Company SG&A as a percentage of sales declined 115 basis points
         year-over-year despite planned increases in Inventory Locator Service
         (ILS) SG&A levels
     --  Major new airline-related contract (Engine Systems and Accessories and
         Environmental Control Systems) signed with Honeywell - estimated to
         produce additional annualized sales of $30 million
     --  Successful rollout of new look and functionality for next-generation
         aviall.com
     --  Raising 2001 earnings estimate range by $0.05 to $0.65 - $0.67 per
         share
 
     First Quarter Results
     Aviall, Inc. net earnings in the period were $2.7 million, or $0.15 per
 share (diluted), versus net earnings of $2.2 million, or $0.12 per share
 (diluted), in the comparable 2000 period.  First quarter 2001 net sales were
 $130.0 million, 13% above last year's net sales level of $114.9 million.
 Aviall Services experienced sharp sales growth, up nearly 15% year over year,
 driven by stronger than anticipated core business and higher Rolls-Royce
 sales.  The healthy sales increase included only minimal revenue from the
 recently added Honeywell contracts.  Aviall Services expects revenues from
 these new contracts to be completely phased in by the end of the second
 quarter at an estimated annualized rate of $50 million per year.  While ILS
 first quarter sales of $6.7 million were down $0.6 million year-over-year, ILS
 set new customer usage records and showed signs of recovery from competitive
 loss-leader induced pricing declines in prior quarters.
     Gross profit of $29.5 million for the first quarter 2001 was up
 $2.2 million or 8% from first quarter 2000 gross profit of $27.3 million.  The
 gross profit percentage fell slightly to 22.7% reflecting a stronger base of
 Rolls-Royce sales that have a slightly lower margin.  Although selling and
 administrative expenses increased $1.3 million on a $15 million incremental
 gain in sales compared to first quarter 2000, SG&A expense as a percentage of
 sales fell 115 basis points to 17.4%.  The dollar increase in first quarter
 SG&A expense can be attributed slightly to higher sales and to a larger degree
 to exchange losses incurred in Australian and Canadian markets and planned
 increased technology infrastructure costs at both ILS and Aviall Services.  As
 expected, operating income margin increased to 5.2% in the first quarter of
 2001 from the 5.1% in the same quarter of 2000.
 
     Review and Outlook
     "I am pleased that the Company has sustained its momentum into 2001, both
 financially and operationally," said Paul E. Fulchino, Aviall's chairman,
 president and chief executive officer.  "We are continuing to energize the
 sales and earnings for the Company through our ongoing programs to refine and
 upgrade Aviall's sales coverage systems, distribution infrastructure and
 web-based technology platforms.  Specifically, Aviall Services is achieving
 rapid quarterly sales growth due to the rebound in our core business sales,
 better-than-expected Rolls-Royce sales, and new product line additions.  In
 addition the outlook for ILS has improved with new records being set for
 transactions, quote requests sent, and inventory listings."
     Fulchino added, "We aggressively continue to seek additional new part
 product lines to complement our wide array of top manufacturers.  At the end
 of the first quarter, these efforts produced a second new product line
 addition from Honeywell, one that will expand our commercial airline presence
 and helped to increase our estimated 2001 results to 65-67 cents per share."
     Fulchino continued, "The Company is also actively pursuing the expansion
 of its current bank credit facilities and the restructuring of its long-term
 debt to accommodate additional accretive new business and strategic
 acquisition opportunities.  An announcement about expansion of the current
 credit facilities and long-term capital structure is expected shortly."
     In closing Fulchino said, "Aviall is delighted that our customers have so
 positively accepted our new technology platforms.  Aviall Services' integrated
 BroadVision, Siebel and NEON web-based platform, aviall.com, offers
 significant potential supply-chain efficiencies to both our suppliers and our
 customers.  ILS's modular rollout of its full-commerce Contact to Contract(TM)
 next-generation system, ILSmart.com, has been enthusiastically embraced by
 subscribers, as each module becomes available.  At both Aviall Services and
 ILS, we look forward to continued customer training and education that will
 enhance our customers' ability to fully utilize the power of these dual-access
 platforms.  With these investments started in 2000 and continuing into 2001,
 we are moving consistently toward our goal of having Aviall's customer-focused
 technologies and leading operating capabilities recognized as the standard for
 the aerospace industry."
 
     Aviall will host a conference call on Monday, April 23, 2001, at
 11 a.m. ET.  The conference call can be accessed by calling (888) 928-9524
 (toll free) or (712) 257-2761 (toll).  A replay will be available until
 7 p.m. ET on Wednesday, April 25, 2001, at (800) 835-4610 (toll-free) or
 (402) 280-1658 (toll).
 
     Forward-Looking Statements
     The statements contained in this release that are not historical facts are
 forward-looking statements (as such term is defined in the Private Securities
 Litigation Act of 1995).  Actual results may differ materially from those
 expected in the forward-looking statements.  These forward-looking statements
 involve risks and uncertainties, including competitive factors and pricing and
 supply pressures, shifts in market demand, general economic conditions and
 other factors including, among others, those that affect flight activity in
 commercial, business and general aviation, the business activities of the
 Company's customers and suppliers and developments in information and
 communications technology.
 
     About Aviall, Inc.
     Aviall, Inc. is a leading solutions provider of aftermarket supply-chain
 management services for the aviation and marine industries.  As the world's
 largest independent provider of new aviation parts and related aftermarket
 services, the Aviall Services business unit markets and distributes products
 for approximately 175 manufacturers and distributes approximately 90,000 line
 items from customer service centers located in North America, Europe and
 Asia-Pacific.  Aviall Services also supports a full line of aviation
 batteries, hoses, wheels and brake services.  The Inventory Locator Service
 (ILS) business unit, headquartered in Memphis, Tennessee, provides information
 and enables commerce via its global electronic marketplace to enable
 subscribers to buy and sell commercial aviation and marine parts, equipment
 and services.  Additional information on Aviall is available via the Internet
 at www.aviall.com.
 
 
                                  AVIALL, INC.
 
                       CONSOLIDATED STATEMENTS OF INCOME
                   (Dollars in thousands, except share data)
                                  (Unaudited)
 
                                                 Three months ended March 31,
                                                    2001              2000
 
     Net sales                                     $130,022           114,905
     Cost of sales                                  100,548            87,640
     Gross profit                                    29,474            27,265
     Operating and other expenses:
       Selling and administrative expenses           22,675            21,355
       Interest expense                               2,296             2,101
     Earnings before income taxes                     4,503             3,809
     Provision for income taxes (A)                   1,801             1,626
     Net earnings                                  $  2,702             2,183
 
     Basic net earnings per share                  $   0.15              0.12
     Weighted average common shares              18,461,527        18,276,474
 
     Diluted net earnings per share                $   0.15              0.12
     Weighted average common and potentially
      dilutive common shares                     18,493,638        18,341,995
 
     (A)  Due to the Company's large U.S. federal tax loss carryforwards, cash
          tax payments are substantially lower than the provision recorded.
          Cash tax payments were $0.5 million for the 1st quarter.
 
 
                                  AVIALL, INC.
 
                        SELECTED BALANCE SHEET ACCOUNTS
                             (Dollars in thousands)
 
                                          March 31,       December 31,
                                             2001             2000
                                         (Unaudited)        (Audited)
     Cash                                  $  3,693            4,865
     Receivables                           $ 85,608           83,395
     Inventories                           $157,956          134,156
     Deferred tax asset                    $ 70,813           72,299
     Accounts payable                      $ 78,080           66,657
     Debt                                  $110,272           90,422
     Shareholders' equity                  $193,957          191,674
 
 
                              SEGMENT INFORMATION
                             (Dollars in thousands)
                                  (Unaudited)
 
                                         Three months ended March 31,
     Revenues                                2001             2000
     Aviall Services                       $123,319          107,578
     ILS                                      6,703            7,327
       Total revenue                       $130,022          114,905
 
     Profit
     Aviall Services                       $  6,597            4,258
     ILS                                      2,541            3,500
       Reportable segment profit              9,138            7,758
     Corporate                               (2,339)          (1,848)
     Interest expense                        (2,296)          (2,101)
     Earnings before income taxes          $  4,503            3,809
 
 
                         DEPRECIATION AND AMORTIZATION
                             (Dollars in thousands)
                                  (Unaudited)
 
                                         Three months ended March 31,
                                             2001             2000
     Depreciation                          $  1,100            1,015
     Amortization                             1,189            1,083
     Debt issue cost                            179              102
                                           $  2,468            2,200
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X44076524
 
 

SOURCE Aviall, Inc.
    DALLAS, April 23 /PRNewswire Interactive News Release/ -- Aviall, Inc.
 (NYSE:   AVL) today reported financial results for the first quarter of 2001.
 
     Highlights
     --  Earned $0.15 per share (diluted) versus $0.12 in Q1 2000
     --  Revenues grew 13% year-over-year despite minimal revenue to date from
         the phase-in of the new Honeywell fuel control contract
     --  Total Company SG&A as a percentage of sales declined 115 basis points
         year-over-year despite planned increases in Inventory Locator Service
         (ILS) SG&A levels
     --  Major new airline-related contract (Engine Systems and Accessories and
         Environmental Control Systems) signed with Honeywell - estimated to
         produce additional annualized sales of $30 million
     --  Successful rollout of new look and functionality for next-generation
         aviall.com
     --  Raising 2001 earnings estimate range by $0.05 to $0.65 - $0.67 per
         share
 
     First Quarter Results
     Aviall, Inc. net earnings in the period were $2.7 million, or $0.15 per
 share (diluted), versus net earnings of $2.2 million, or $0.12 per share
 (diluted), in the comparable 2000 period.  First quarter 2001 net sales were
 $130.0 million, 13% above last year's net sales level of $114.9 million.
 Aviall Services experienced sharp sales growth, up nearly 15% year over year,
 driven by stronger than anticipated core business and higher Rolls-Royce
 sales.  The healthy sales increase included only minimal revenue from the
 recently added Honeywell contracts.  Aviall Services expects revenues from
 these new contracts to be completely phased in by the end of the second
 quarter at an estimated annualized rate of $50 million per year.  While ILS
 first quarter sales of $6.7 million were down $0.6 million year-over-year, ILS
 set new customer usage records and showed signs of recovery from competitive
 loss-leader induced pricing declines in prior quarters.
     Gross profit of $29.5 million for the first quarter 2001 was up
 $2.2 million or 8% from first quarter 2000 gross profit of $27.3 million.  The
 gross profit percentage fell slightly to 22.7% reflecting a stronger base of
 Rolls-Royce sales that have a slightly lower margin.  Although selling and
 administrative expenses increased $1.3 million on a $15 million incremental
 gain in sales compared to first quarter 2000, SG&A expense as a percentage of
 sales fell 115 basis points to 17.4%.  The dollar increase in first quarter
 SG&A expense can be attributed slightly to higher sales and to a larger degree
 to exchange losses incurred in Australian and Canadian markets and planned
 increased technology infrastructure costs at both ILS and Aviall Services.  As
 expected, operating income margin increased to 5.2% in the first quarter of
 2001 from the 5.1% in the same quarter of 2000.
 
     Review and Outlook
     "I am pleased that the Company has sustained its momentum into 2001, both
 financially and operationally," said Paul E. Fulchino, Aviall's chairman,
 president and chief executive officer.  "We are continuing to energize the
 sales and earnings for the Company through our ongoing programs to refine and
 upgrade Aviall's sales coverage systems, distribution infrastructure and
 web-based technology platforms.  Specifically, Aviall Services is achieving
 rapid quarterly sales growth due to the rebound in our core business sales,
 better-than-expected Rolls-Royce sales, and new product line additions.  In
 addition the outlook for ILS has improved with new records being set for
 transactions, quote requests sent, and inventory listings."
     Fulchino added, "We aggressively continue to seek additional new part
 product lines to complement our wide array of top manufacturers.  At the end
 of the first quarter, these efforts produced a second new product line
 addition from Honeywell, one that will expand our commercial airline presence
 and helped to increase our estimated 2001 results to 65-67 cents per share."
     Fulchino continued, "The Company is also actively pursuing the expansion
 of its current bank credit facilities and the restructuring of its long-term
 debt to accommodate additional accretive new business and strategic
 acquisition opportunities.  An announcement about expansion of the current
 credit facilities and long-term capital structure is expected shortly."
     In closing Fulchino said, "Aviall is delighted that our customers have so
 positively accepted our new technology platforms.  Aviall Services' integrated
 BroadVision, Siebel and NEON web-based platform, aviall.com, offers
 significant potential supply-chain efficiencies to both our suppliers and our
 customers.  ILS's modular rollout of its full-commerce Contact to Contract(TM)
 next-generation system, ILSmart.com, has been enthusiastically embraced by
 subscribers, as each module becomes available.  At both Aviall Services and
 ILS, we look forward to continued customer training and education that will
 enhance our customers' ability to fully utilize the power of these dual-access
 platforms.  With these investments started in 2000 and continuing into 2001,
 we are moving consistently toward our goal of having Aviall's customer-focused
 technologies and leading operating capabilities recognized as the standard for
 the aerospace industry."
 
     Aviall will host a conference call on Monday, April 23, 2001, at
 11 a.m. ET.  The conference call can be accessed by calling (888) 928-9524
 (toll free) or (712) 257-2761 (toll).  A replay will be available until
 7 p.m. ET on Wednesday, April 25, 2001, at (800) 835-4610 (toll-free) or
 (402) 280-1658 (toll).
 
     Forward-Looking Statements
     The statements contained in this release that are not historical facts are
 forward-looking statements (as such term is defined in the Private Securities
 Litigation Act of 1995).  Actual results may differ materially from those
 expected in the forward-looking statements.  These forward-looking statements
 involve risks and uncertainties, including competitive factors and pricing and
 supply pressures, shifts in market demand, general economic conditions and
 other factors including, among others, those that affect flight activity in
 commercial, business and general aviation, the business activities of the
 Company's customers and suppliers and developments in information and
 communications technology.
 
     About Aviall, Inc.
     Aviall, Inc. is a leading solutions provider of aftermarket supply-chain
 management services for the aviation and marine industries.  As the world's
 largest independent provider of new aviation parts and related aftermarket
 services, the Aviall Services business unit markets and distributes products
 for approximately 175 manufacturers and distributes approximately 90,000 line
 items from customer service centers located in North America, Europe and
 Asia-Pacific.  Aviall Services also supports a full line of aviation
 batteries, hoses, wheels and brake services.  The Inventory Locator Service
 (ILS) business unit, headquartered in Memphis, Tennessee, provides information
 and enables commerce via its global electronic marketplace to enable
 subscribers to buy and sell commercial aviation and marine parts, equipment
 and services.  Additional information on Aviall is available via the Internet
 at www.aviall.com.
 
 
                                  AVIALL, INC.
 
                       CONSOLIDATED STATEMENTS OF INCOME
                   (Dollars in thousands, except share data)
                                  (Unaudited)
 
                                                 Three months ended March 31,
                                                    2001              2000
 
     Net sales                                     $130,022           114,905
     Cost of sales                                  100,548            87,640
     Gross profit                                    29,474            27,265
     Operating and other expenses:
       Selling and administrative expenses           22,675            21,355
       Interest expense                               2,296             2,101
     Earnings before income taxes                     4,503             3,809
     Provision for income taxes (A)                   1,801             1,626
     Net earnings                                  $  2,702             2,183
 
     Basic net earnings per share                  $   0.15              0.12
     Weighted average common shares              18,461,527        18,276,474
 
     Diluted net earnings per share                $   0.15              0.12
     Weighted average common and potentially
      dilutive common shares                     18,493,638        18,341,995
 
     (A)  Due to the Company's large U.S. federal tax loss carryforwards, cash
          tax payments are substantially lower than the provision recorded.
          Cash tax payments were $0.5 million for the 1st quarter.
 
 
                                  AVIALL, INC.
 
                        SELECTED BALANCE SHEET ACCOUNTS
                             (Dollars in thousands)
 
                                          March 31,       December 31,
                                             2001             2000
                                         (Unaudited)        (Audited)
     Cash                                  $  3,693            4,865
     Receivables                           $ 85,608           83,395
     Inventories                           $157,956          134,156
     Deferred tax asset                    $ 70,813           72,299
     Accounts payable                      $ 78,080           66,657
     Debt                                  $110,272           90,422
     Shareholders' equity                  $193,957          191,674
 
 
                              SEGMENT INFORMATION
                             (Dollars in thousands)
                                  (Unaudited)
 
                                         Three months ended March 31,
     Revenues                                2001             2000
     Aviall Services                       $123,319          107,578
     ILS                                      6,703            7,327
       Total revenue                       $130,022          114,905
 
     Profit
     Aviall Services                       $  6,597            4,258
     ILS                                      2,541            3,500
       Reportable segment profit              9,138            7,758
     Corporate                               (2,339)          (1,848)
     Interest expense                        (2,296)          (2,101)
     Earnings before income taxes          $  4,503            3,809
 
 
                         DEPRECIATION AND AMORTIZATION
                             (Dollars in thousands)
                                  (Unaudited)
 
                                         Three months ended March 31,
                                             2001             2000
     Depreciation                          $  1,100            1,015
     Amortization                             1,189            1,083
     Debt issue cost                            179              102
                                           $  2,468            2,200
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X44076524
 
 SOURCE  Aviall, Inc.