10-year

10-Year Anniversary Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Once a decade discount

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

LMI Aerospace Inc. Reports Operating Results (10-Q)

May 11, 2009 | About:

LMI Aerospace Inc. (LMIA) filed Quarterly Report for the period ended 2009-03-31.

LMI Aerospace Inc. is a leading fabricator finisher and integrator offormed close tolerance aluminum and specialty alloy components for use by the aerospace industry. For approximately 50 years the Company has been engaged in manufacturing components for a wide variety of aerospace applications. Components manufactured by the Company include leading edge wing slats flaps and lens assemblies; cockpit window frame assemblies; fuselage skins and supports; and passenger and cargo door frames and supports. LMI Aerospace Inc. has a market cap of $113.5 million; its shares were traded at around $9.81 with a P/E ratio of 6.5 and P/S ratio of 0.5.

Highlight of Business Operations:

Net sales for the first quarter of 2009 were $43.3 million, up 16.7% from $37.1 million in the first quarter of 2008. The increase in net sales occurred in the corporate and regional aircraft, large commercial aircraft and military sectors. The increase was due, in part, to $5.3 million in tooling sales in the first quarter of 2009, including tooling sales of $2.8 million on the G250, $1.1 million on the CRJ-1000, $0.9 million on the G650 and $0.4 million on the 747-8.

Net sales of products used in large commercial aircraft were $14.7 million for the first quarter of 2009 compared to $10.7 million for the first quarter of 2008, an increase of $4.0 million or 37.4%. The increase in net sales to this market was driven by support for the 767 wing modification and winglet program, which generated $5.0 million of sales. We also increased net sales for the Boeing 747 by $1.4 million to $3.1 million in the first quarter of 2009 from $1.7 million in the first quarter of 2008. These increases were partially offset by a $2.0 million decrease in sales for the Boeing 737 from $6.7 million in the first quarter of 2008 to $4.7 million in the first quarter of 2009 and a $0.5 million decrease in other large commercial aircraft products from $1.7 million in the first quarter of 2008 to $1.2 million in the first quarter of 2009, primarily as a residual impact of the Boeing strike in the fourth quarter of 2008 and a late March inventory assessment by a Tier 1 customer that deferred March sales of $0.5 million into April 2009.

Military products generated $11.1 million of net sales in the first quarter of 2009 compared to $9.9 million in the first quarter of 2008, an increase of $1.2 million or 12.1%. This increase resulted from net sales for the Sikorsky Blackhawk program which generated $8.6 million of net sales in the first quarter of 2009 compared to $7.0 million in the first quarter of 2008. An increase also resulted from net sales for the Boeing Apache helicopter of $1.9 million in the first quarter of 2009 compared to $1.3 million in the first quarter of 2008. These increases were offset by a slight decline in other military products from $1.5 million in the first quarter of 2008 to $0.7 million in the first quarter of 2009.

Net sales for the Engineering Services segment were $20.8 million for the first quarter of 2009 compared to $23.3 million for the first quarter of 2008, a decrease of $2.5 million or 10.7%. This decrease resulted from three fewer work days in the first quarter of 2009 compared to the first quarter of 2008 as well as lower client overtime requirements in 2009 compared to 2008. Approximately $20.6 million, or 99.0% of the segment s revenues, were recorded under reimbursement type contracts for engineering services compared to $22.2 million for the first quarter of 2008, a decrease of 7.2%. These revenues are generated from labor hours incurred at varying, pre-negotiated rates and other direct costs plus an administrative fee. Net sales under these reimbursement contracts are primarily for commercial, corporate and military markets.

Net sales for services supporting corporate and regional aircraft, the majority of which relate to the development of new and redesigned aircraft, were approximately $4.9 million in the first quarter of 2009 compared to $7.2 million for the first quarter of 2008, a decrease of $2.3 million or 31.9%. Net sales for services for large commercial aircraft were approximately $9.6 million in the first quarter of 2009, down $1.5 million, or 13.5%, from $11.1 million in the first quarter of 2008. These revenues are primarily from design programs supporting Boeing s 747-8 and 787 platforms. In addition to the factors discussed above, these decreases resulted from the winding down of certain programs, including the 777 Freighter and G650. Net sales of services for military programs were $5.8 million in the first quarter of 2009, up $2.3 million or 65.7% from $3.5 million in the first quarter of 2008. These military revenues were derived from support provided on multiple Navy programs, as well as the F-35, the CH-53 helicopter and other programs. The increased sales of services for military programs are consistent with management s strategy for growth and have helped offset the decreases of sales experienced in other major categories.

During the first quarter of 2009, we used $8.0 million of cash in operating activities, compared to $4.0 million in the first quarter of 2008. An increase in accounts receivable used $12.4 million of cash in the first quarter of 2009 as sales for tooling and 767 wing modification kits of approximately $10 million were predominately billed in March. Accrued liabilities decreased by $2.1 million in the first quarter of 2009. We used cash for payments for various bonus plans, 401(k) and profit sharing contributions for 2008, and customer rebate programs. Decrease in accounts payable also used cash of $1.6 million.

Read the The complete Report

Rating: 3.0/5 (1 vote)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK