Supreme Industries Reports Significantly Improved 2012 Earnings

  Supreme Industries Reports Significantly Improved 2012 Earnings

    Full-Year Net Income Surges to $11.8 Million from $0.8 Million in 2011

   Net Income per Diluted Share Increases to $0.77 from $0.05 in Prior Year

Business Wire

GOSHEN, Ind. -- February 7, 2013

Supreme Industries, Inc. (NYSE MKT: STS), a leading manufacturer of
specialized commercial vehicles including truck bodies, shuttle buses, and
armored vehicles, today announced significantly improved earnings for its full
year ended Dec. 29, 2012.

2012 Fourth-Quarter Results

Consolidated net sales of $57.7 million for the fourth quarter declined 11.8%
from $65.5 million in last year’s comparable period. The lower sales related
to two large orders in the fourth quarter of 2011 that were not repeated in
2012, along with intense competition and increased discounting in the bus
industry on state and municipal bid orders.

Gross margin as a percentage of sales declined slightly to 13.2%, compared
with 13.4% in last year’s fourth quarter. Gross profit declined to $7.6
million from last year’s $8.7 million on the lower sales volume and a change
in product mix. Other income increased $0.2 million due to a gain on sale of
an investment. For the quarter, the Company reported net income of $0.4
million, or $0.02 per diluted share, compared with net income of $1.9 million,
or $0.12 per diluted share, in the fourth quarter of 2011.

Supreme’s Chief Financial Officer and Interim Chief Executive Officer Matthew
Long said: “We continue to successfully implement the strategy of
concentrating on sales and markets that meet or exceed our margin criteria. By
enhancing manufacturing efficiencies and better managing costs, we have
successfully developed a model that can drive sustainable profits into the
future. Entering 2013, we are encouraged by our team’s progress to date, and
by the opportunities we see before us to continue satisfying our customers
with on-time delivery of specialty vehicles that represent the very best
quality, safety and value.”

2012 Full-Year Results

Consolidated net sales decreased 4.7%, to $286.1 million, from $300.4 million
last year. Gross profit increased 33.9%, to $43.5 million, from 2011’s $32.5
million. Gross profit, as a percentage of sales, improved dramatically to
15.2%, compared with 10.8% in 2011. The 4.4% increase in gross margin
percentage is the result of refined pricing methodologies, improved labor
efficiencies and the redesign of certain manufacturing facilities.

The Company reported full-year income from continuing operations of $11.8
million, or $0.77 per diluted share, compared with last year’s income from
continuing operations of $1.7 million, or $0.11 per diluted share. Net income
for the full year improved to $11.8 million, or $0.77 per diluted share,
compared with net income of $0.8 million, or $0.05 per diluted share in 2011,
which included the impact from discontinued operations.

The Company’s effective tax rate was 5.9% for the year ending Dec. 29, 2012,
substantially lower than statutory rates due to the reversal of deferred tax
asset reserves and the use of net operating loss carryforwards. Reported
financial results in 2011 included an income tax benefit of $0.4 million
recorded in the fourth quarter, resulting from expiring state statues related
to uncertain tax positions. Beginning with the first quarter of 2013, the
Company expects to recognize income taxes at more normalized rates.

Working capital was $38.6 million at Dec. 29, 2012, up from $35.4 million at
Dec. 31, 2011. The working capital ratio was 2.7 to 1 versus 2.0 to 1 for the
respective periods. During 2012, Supreme invested $7.1 million in facilities
and equipment to enhance efficiencies and $6.1 million to exercise two
related-party lease purchase options. On Dec. 19, 2012, the Company entered
into a five-year revised cash flow credit agreement increasing its line of
credit to $45 million with improved liquidity, availability and interest rate
pricing. Total debt declined to $14.1 million at year end, compared with $15.9
million last year. Stockholders’ equity increased 22% to $67.2 million, or
$4.41 per share, at Dec. 29, 2012, compared with $54.9 million, or $3.71 per
share, at Dec. 31, 2011. Net cash provided by operating activities during 2012
totaled $12.4 million, compared with $14.5 million in 2011.

As disclosed in the second quarter of 2012, the Company self-identified an
immaterial error related to revenue recognition. Accordingly, its consolidated
financial statements reflect the correction of the immaterial error.

Conference Call Information

A conference call will be held tomorrow, Feb. 8, 2013, at 9 a.m. ET to review
the fourth-quarter and full-year results. To participate in the live call,
dial 877-317-6789 (International: 412-317-6789) 10 minutes before the call
begins, or 8:50 a.m. ET. The conference ID is 10024460. The call also will be
streamed live and can be accessed at http://www.SupremeInd.com. Those unable
to participate in the live conference call may access a replay, which will be
available on Supreme’s website for approximately 30 days.

To be added to Supreme Industries’ email distribution list, please click on
the link below:
http://www.clearperspectivegroup.com/clearsite/sts/emailoptin.html.

About Supreme Industries

Supreme Industries, Inc. (NYSE MKT: STS), is a nationwide manufacturer of
specialized truck bodies produced to the specifications of its customers.
Supreme also manufactures special-purpose “shuttle-type” buses and armored
vehicles. 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 on the
Internet at: http://www.supremeind.com or
http://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 and
severe interest rate increases. 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
Consolidated Statements of Income
                                                  
               Three Months Ended                    Twelve Months Ended
               December 29,     December 31,        December 29,     December 31,
               2012              2011                2012              2011
Net sales      $ 57,728,124      $ 65,457,410        $ 286,140,112     $ 300,360,689
Cost of sales   50,135,847      56,715,558        242,644,088     267,865,675 
Gross profit     7,592,277         8,741,852           43,496,024        32,495,014
                                                                       
Selling,
general and      7,532,520         7,025,316           32,219,058        27,653,505
administrative
expenses
Legal
settlement and   -                 -                   -                 2,182,091
related costs
                                                                                     
Other income    (450,472    )    (228,575    )      (1,217,057  )    (850,420    )
Operating        510,229           1,945,111           12,494,023        3,509,838
income
                                                                       
Interest        241,705         301,033           971,225         2,243,249   
expense
Income from
continuing
operations       268,524           1,644,078           11,522,798        1,266,589
before income
tax
                                                                       
Income tax      (115,056    )    (401,000    )      (310,190    )    (401,000    )
benefit
Income from
continuing       383,580           2,045,078           11,832,988        1,667,589
operations
                                                                       
Discontinued
operations
Operating loss
of
discontinued    -               (159,091    )      -               (876,920    )
Oregon
operations
Net income     $ 383,580        $ 1,885,987        $ 11,832,988     $ 790,669     
                                                                       
Basic income
(loss) per
share:
Income from
continuing     $ 0.03            $ 0.13              $ 0.78            $ 0.11
operations
Loss from
discontinued    -               (0.01       )      -               (0.06       )
operations
Net income per $ 0.03           $ 0.12             $ 0.78           $ 0.05        
basic share
                                                                       
Diluted income
(loss) per
share:
Income from
continuing     $ 0.02            $ 0.13              $ 0.77            $ 0.11
operations
Loss from
discontinued    -               (0.01       )      -               (0.06       )
operations
Net income per $ 0.02           $ 0.12             $ 0.77           $ 0.05        
diluted share
                                                                       
Shares used in
the
computation of
income (loss)
per share:
Basic            15,219,856        15,159,910          15,194,823        14,808,171
Diluted          15,447,552        15,266,155          15,440,484        15,030,772
                                                                       
Supreme Industries, Inc. and Subsidiaries
Consolidated Balance Sheets
                                                                       
               December 29,      December 31,
               2012              2011
                                                                       
Assets
Current assets $ 61,007,286      $ 69,509,587
Property,
plant and        42,937,988        33,530,057
equipment, net
Other assets    1,142,809       1,683,718   
Total assets   $ 105,088,083    $ 104,723,362 
                                                                       
Liabilities
Current        $ 22,363,408      $ 34,087,548
liabilities
Long-term       15,561,793      15,702,467  
liabilities
Total            37,925,201        49,790,015
liabilities
Total
stockholders'   67,162,882      54,933,347  
equity
Total
liabilities
and            $ 105,088,083    $ 104,723,362 
stockholders'
equity

Contact:

Supreme Investor Relations
Investor and Media Contact
Matthew J. Dennis, CFA, 574-228-4130
 
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