Top News

American Apparel Got Indication of Interest for $1.30-$1.40 per Share
Tweet TWEET

Supreme Industries Reports First-Quarter 2014 Results

  Supreme Industries Reports First-Quarter 2014 Results

  Extreme Weather Conditions and Chassis Shortages Impact Sales and Earnings

Business Wire

GOSHEN, Ind. -- April 24, 2014

Supreme Industries, Inc. (NYSE MKT: STS), a leading manufacturer of
specialized commercial vehicles including truck bodies and specialty vehicles,
today announced financial results for its first quarter ended March 29, 2014.
All earnings per share and share figures in this press release have been
adjusted for the 5% stock dividend distributed in the second quarter of 2013.

During the first quarter of 2014, the previously disclosed divestiture of the
Company’s shuttle bus assets was completed. As a result, the shuttle bus
business has been reclassified as a discontinued operation in the Company’s
financial statements.

Consolidated net sales from continuing operations in the quarter were $53.4
million, compared with $56.4 million in the first quarter of 2013. The revenue
decrease was primarily due to lower sales of specialty vehicles versus the
prior year, as well as chassis constraints impacting first-quarter fleet
shipments.

Gross margin from continuing operations during the first quarter was 14.8%,
compared with 19.7% in last year’s first quarter. The current-year margin
contraction was primarily due to unfavorable product mix compared to 2013,
which included a higher proportion of lower-margin fleet business and its
associated start up inefficiencies, as well as a lower proportion of
higher-margin retail and specialty vehicles. Shortages of light-duty chassis
from a major supplier constrained shipping volume during the quarter causing
higher labor and overhead cost compared to last year, and production
efficiencies were also hampered by the extremely inclement weather.

Other income decreased $0.7 million primarily due to a realized gain on the
sale of real estate during the first quarter of 2013. Interest expense
improved 22% from last year on lower debt balances. Income tax expense from
continuing operations was $0.1 million, down from $1.3 million in last year’s
first quarter. The effective tax rate from continuing operations in the first
quarter of 2014 was 32.4%, compared with 33.2% in 2013’s first quarter.

Income from continuing operations was $0.2 million, or $0.01 per diluted
share, versus $2.6 million, or $0.16 per diluted share, last year. Including
the $1.6 million after-tax operating loss from the discontinued shuttle bus
operations, the net loss reported for the first quarter was $1.3 million, or
$0.08 per diluted share compared with last year’s net income of $2.3 million,
or $0.14 per diluted share.

“Our first-quarter product mix and delayed deliveries from major suppliers had
a negative impact on margins in the quarter,” said President and Chief
Executive Officer, Mark Weber. “We are taking actions to mitigate our business
risk from future chassis supply interruptions by increasing the size of our
pools of chassis and broadening the product offering,” he added.

Backlog, excluding shuttle bus, at the end of the quarter stood at $74
million, compared with $72 million at December 28, 2013, and $69 million at
the end of 2013’s first quarter.

Additional year-over-year key performance indicators include:

  *Working capital was $36.2 million at the end of the first quarter,
    compared with $37.6 million at December 28, 2013.
  *Net cash used by operating activities for the first quarter of 2014
    totaled $0.9 million, compared with cash used of $0.3 million in the first
    quarter of 2013.
  *Total debt at the end of the first quarter of 2014 was $9.5 million,
    compared with $9.7 million at the end of 2013.
  *Stockholders’ equity at the end of the quarter was $72.9 million, compared
    with $74.1 million at December 28, 2013.
  *Book value, on a per-share basis, stood at $4.50 on March 29, 2014, versus
    $4.59 at the end of 2013.

As disclosed in its March 31, 2014, press release, Supreme recorded a small
gain on the sale of its shuttle bus assets, which is reported as discontinued
operations. Due to excess industry capacity, the buyer was not interested in
production facilities of the shuttle bus division, but instead purchased brand
names, goodwill, inventory, as well as machinery and equipment fairly valued
as of the date of the close. Proceeds from the sale were $3.9 million versus
the $7.0 million estimate provided by the Company on February 28, 2014. The
difference resulted from Supreme managing its raw materials and
work-in-process inventory to a lower level, while shipping more finished buses
than originally anticipated prior to closing leaving fewer assets to sell. All
receivables, property, plant and some manufacturing equipment were retained
and will be utilized in ongoing operations or be sold at a later date.

“We are pleased to have concluded the strategic divestiture of the shuttle bus
assets during the quarter,” Weber said. “Having this transaction behind us
allows management to increase focus on growing the core business.”

Conference Call Information

A conference call will take place tomorrow, April 25, 2014, at 9:00 a.m. ET to
review the 2014 first-quarter results. To participate in the live call, dial
877-300-8521 (International: 412-317-6026) 10 minutes before the call begins,
or at 8:50 a.m. ET. The conference ID is 10045022. 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.

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 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 Operations
                                                           
                                             Three Months Ended
                                             Mar. 29, 2014      Mar. 30, 2013
                                                                
Net sales                                    $ 53,393,557       $ 56,371,169
Cost of sales                                 45,503,050       45,268,121 
Gross profit                                   7,890,507          11,103,048
                                                                
Selling, general and administrative            7,519,990          7,804,930
expenses
Other income                                  (37,225    )      (706,962   )
Operating income                               407,742            4,005,080
                                                                
Interest expense                              76,111           98,093     
Income from continuing operations before       331,631            3,906,987
income taxes
                                                                
Income tax expense                            107,614          1,296,505  
Income from continuing operations             224,017          2,610,482  
                                                                
Discontinued operations
Gain on sale of discontinued operations,       87,036             -
net of tax
Operating loss of discontinued                (1,654,459 )      (306,676   )
operations, net of tax
Loss from discontinued operations, net        (1,567,423 )      (306,676   )
of tax
                                                                
Net income (loss)                            $ (1,343,406 )     $ 2,303,806  
                                                                
Basic income (loss) per share:
Income from continuing operations            $ 0.01             $ 0.16
Loss from discontinued operations             (0.09      )      (0.02      )
Net income (loss)                            $ (0.08      )     $ 0.14       
                                                                
Diluted income (loss) per share:
Income from continuing operations            $ 0.01             $ 0.16
Loss from discontinued operations             (0.09      )      (0.02      )
Net income (loss)                            $ (0.08      )     $ 0.14       
                                                                
Shares used in the computation of income
(loss) per share:
(Adjusted for 5% stock dividend paid on
June 3, 2013)
Basic                                          16,202,499         16,013,323
Diluted                                        16,631,421         16,321,571
                                                                             

Supreme Industries, Inc. and Subsidiaries
Consolidated Balance Sheets
                                                            
                                               Mar. 29, 2014     Dec. 28, 2013
Assets
Current assets                                 $ 62,896,208      $ 65,923,357
Property, plant and equipment, net               46,534,154        46,387,839
Other assets                                    1,143,425        1,219,655
Total assets                                   $ 110,573,787     $ 113,530,851
                                                                 
Liabilities
Current liabilities                            $ 26,731,825      $ 28,343,456
Long-term liabilities                           10,949,408       11,107,228
Total liabilities                                37,681,233        39,450,684
Total stockholders' equity                      72,892,554       74,080,167
Total liabilities and stockholders' equity     $ 110,573,787     $ 113,530,851

Contact:

Supreme Investor Relations
Investor and Media Contact:
Matthew J. Dennis, CFA, 574-228-4130
 
Press spacebar to pause and continue. Press esc to stop.