Net Income of $1.9 Million on Sales of $68.7
Million Impacted by Temporary Customer-Supplied Chassis Delays
Order Backlog Grows to $115 Million
Supreme Industries, Inc. (NYSE MKT: STS), a leading
manufacturer of specialized commercial vehicles including truck
bodies and specialty vehicles, today announced financial results
for the first quarter ended April 1, 2017.
Net sales in the first quarter declined 1% to $68.7 million,
compared with net sales of $69.4 million in the comparable quarter
of 2016. First-quarter net income in 2017 was $1.9 million, or
$0.11 per diluted share, compared with $3.8 million, or $0.22 per
diluted share, in the same quarter of the prior year.
“Sales and earnings were negatively impacted during the quarter
by temporary delays in receiving customer-supplied chassis to
commence rental fleet production,” said Mark Weber, President and
Chief Executive Officer. “While no orders were lost, the delays due
to third-party transportation capacity constraints required the
orders to be rescheduled across all plants into subsequent
quarters. Operations were impacted as a result of dedicated
personnel being onboarded, trained and awaiting chassis arrival.
Fortunately, the chassis transportation issues were resolved by
late March, and our shipments have ramped up accordingly.”
In the first quarter of 2017, gross margin declined to 18.9% of
sales, down from 21.8% of sales in 2016’s comparable quarter. This
was primarily the result of labor inefficiencies associated with
the chassis delays. Additionally, the quarter was impacted by costs
associated with plant optimization lean initiatives, higher health
insurance claims, as well as a higher mix of lower-margin rental
fleet shipments. Quarterly operating income was $3.0 million in the
first quarter of 2017, compared with $5.8 million in the first
quarter of 2016.
“We are encouraged to report that order intake exceeded $100
million in the opening quarter of 2017 and set a new first-quarter
record for Supreme,” Weber continued. “Both rental fleet and retail
orders delivered solid year-over-year growth as we continued to
gain momentum with strategic accounts.”
Order backlog at the end of the first quarter was $115 million,
up 16% from $99 million at the same time last year, excluding the
trolley backlog of $2.5 million (the trolley product line was
divested in 2016).
Working capital was $59.6 million at the end of 2017’s first
quarter, compared with $58.2 million at December 31, 2016. On April
1, 2017, the Company had $5.4 million of cash and cash equivalents
on hand and total debt was $7.3 million. Stockholders’ equity
increased to $102.8 million, compared with $101.7 million at
December 31, 2016. Tangible book value per share was $6.06 at April
1, 2017, compared with $6.02 per share at the end of last year.
Supreme’s debt to equity ratio at the end of the first quarter of
2017 was 7.1%.
Conference Call Information
A conference call is scheduled for 9:00 a.m. ET, today May 1,
2017, to review the first quarter results and the information set
forth in this press release. To participate in the live call,
please dial 888-349-0089 (International: 412-902-4296) 10 minutes
before the call begins, or at 8:50 a.m. ET. The conference ID is
10104891. The call also will be streamed live and can be accessed
at www.supremecorp.com. Those unable to participate may access a
replay of the call, which will be available on Supreme’s website
for approximately 30 days.
About Supreme Industries
Supreme Industries, Inc. (NYSE MKT: STS), is a nationwide
manufacturer of truck bodies and specialty vehicles produced to the
specifications of its customers. The Company’s transportation
equipment products are used by a wide variety of industrial,
commercial and law enforcement customers.
News releases and other information on the company are available
online at: www.supremecorp.com or
www.b2i.us/irpass.asp?BzID=1482&to=ea&s=0
Other than historical facts contained herein, the matters set
forth in this news release are "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act, as
amended, and reflect the view of management with respect to future
events. When used in this report, words such as "believe,"
"expect," "anticipate," "estimate," "intend," "plan" and similar
expressions, as they relate to Supreme or its plans or operations,
identify forward-looking statements. Such forward-looking
statements are based on assumptions made by, and information
currently available to, management. Although management believes
that the expectations reflected in such forward-looking statements
are reasonable, it can give no assurance that the expectations
reflected in such forward-looking statements are reasonable, and it
can give no assurance that such expectations will prove to be
correct. Important factors that could cause actual results to
differ materially from such expectations include, without
limitation, an economic slowdown in the specialized vehicle
industry, limitations on the availability of chassis on which
Supreme’s product is dependent, availability of raw materials, raw
material cost increases, interest rate increases, a change in the
number of vehicles subject to a recall, changes in the costs of
implementing the recall, actions by NHTSA, including fines and/or
penalties, or limitations on the availability of materials used to
implement the recall. Additionally, end of first quarter 2017
backlog may not be indicative of end of second quarter 2017
backlog, end of full-year 2017 backlog or future performance.
Furthermore, Supreme can provide no assurance that any raw material
cost increases can be passed on to its customers through
implementation of price increases for Supreme's products. The
forward-looking statements contained herein reflect the current
view of management with respect to future events and are subject to
those factors and other risks, uncertainties and assumptions
relating to the operations, results of operations, cash flows and
financial position of Supreme. Supreme assumes no obligation to
update the forward-looking statements or to update the reasons
actual results could differ from those contemplated by such
forward-looking statements.
—FINANCIAL RESULTS FOLLOW—
Supreme Industries, Inc. and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
Three Months Ended Apr. 1, 2017
Mar. 26, 2016 Net sales $ 68,674,699 $
69,449,903 Cost of sales 55,678,922 54,289,246
Gross profit 12,995,777 15,160,657 Selling,
general and administrative expenses 10,051,472 9,414,951 Other
income (69,480 ) (36,476 )
Operating income
3,013,785 5,782,182 Interest expense 245,403
182,829
Income before income taxes 2,768,382
5,599,353 Income tax expense 905,397
1,840,000
Net Income $ 1,862,985 $ 3,759,353
Income per share:
Basic $ 0.11 $ 0.23 Diluted 0.11 0.22
Shares used in the computation of
income per share:
Basic 17,099,107 16,682,812 Diluted 17,101,080 17,127,836
Supreme Industries, Inc. and
Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
Apr. 1, 2017 Dec. 31,
2016 Assets Current assets $ 90,794,629 $ 88,221,351
Property, plant and equipment, net 45,523,946
45,747,933
Total assets $ 136,318,575 $ 133,969,284
Liabilities Current liabilities $ 31,145,081 $ 30,056,157
Long-term liabilities 2,354,401 2,181,778
Total
liabilities 33,499,482 32,237,935
Total stockholders'
equity 102,819,093 101,731,349
Total
liabilities and stockholders' equity $ 136,318,575 $
133,969,284
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170501005173/en/
Investor Relations Contact:Supreme Investor
RelationsMatthew J. Dennis, CFA, 574-228-4130
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