Riviera Tool Company Reports Higher Sales, Improved Performance in Third Quarter
GRAND RAPIDS, Mich., July 15 Riviera Tool Company today announced results for the third quarter of fiscal 2002, reporting sharply higher revenue and continued improvement of financial performance.
The Grand Rapids, Mich.-based designer and manufacturer of stamping die systems reported net sales increased 61 percent to $3.7 million for the quarter ended May 31, 2002, compared with net sales of $2.3 million for the same period in fiscal 2001. The Company attributed the improvement to a continued increase in contract backlog.
The Company narrowed its net loss to $452,632, or $0.13 per share, for the third quarter of fiscal 2002, compared with a net loss of $938,519, or $0.28 per share, for the third quarter of fiscal 2001. During the same period, Riviera reduced its operating loss by 76 percent, reflecting higher volume while maintaining fixed costs.
"While we have work to do to return to profitability, we are encouraged by the progress we made this quarter," said Kenneth K. Rieth, president and chief executive officer of Riviera Tool Company. "We captured substantial new contracts during the just-completed quarter and were able to improve our performance by better managing costs.
"The past two years have been incredibly difficult for our industry, but we are finally beginning to see automakers release new orders. With new contracts and a healthy backlog, we expect to be on the road to profitability in the near term."
During the third quarter of fiscal 2002, Rivera received orders for approximately $17.6 million, bringing the estimated contract backlog to $21.7 million as of May 31,2002, compared to $9.3 million a year ago. The Company anticipates that the new contracts should contribute to financial results over the next 18 to 24 months.
Gross margin improved during the third quarter of fiscal 2002 as a result of increased sales and productivity improvement measures undertaken by the Company in fiscal 2001 and 2002. Riviera said that higher contract volumes, in combination with ongoing efforts to control costs, resulted in the margin improvement.
During the nine months ended May 31, 2002, Riviera narrowed its net loss to $2 million, or $0.58 per share, on net sales of $10.5 million for the third quarter of fiscal 2002, compared with a net loss of $2.5 million, or $0.74 per share, on net sales of $9.3 million for the same period in fiscal 2001. During the same period, Riviera reduced its operating loss by 54 percent.
For the first nine months of fiscal 2002, Riviera improved its gross margin, reflecting higher sales, reduced direct costs and manufacturing overhead expenses.
"The price erosion and margin pressure our industry has experienced over the last two years is starting to subside," Rieth said. "Automakers are beginning to realize the necessity of marketing new models and new designs to customers in order to boost sales -- and that bodes well for Rivera Tool Company. As a full-service supplier, we are well positioned to aggressively capitalize on these new opportunities and capture new contracts from the Big 3 and other global auto manufacturers."
About Riviera Tool:
Riviera Tool Co. (www.rivieratool.com ) designs, develops and manufactures large-scale, custom metal stamping die systems used in the high-speed production of sheet metal parts and assemblies for the global automotive industry. A majority of Riviera's sales are to DaimlerChrysler, GM, Ford Motor Co. and their Tier One suppliers.
Safe Harbor Statement under the Private Securities Litigation Reform Act
of 1995: The statements contained in this news release include certain
predictions and projections that may be considered forward-looking statements
under securities laws. These statements involve a number of important risks
and uncertainties that could cause actual results to differ materially,
including but not limited to economic, competitive, governmental and
technological.
RIVIERA TOOL COMPANY
FINANCIAL STATEMENTS
BALANCE SHEETS
ASSETS May 31, 2002 August 31, 2001
CURRENT ASSETS (unaudited) (audited)
Cash $53,415 $282,721
Accounts receivable 4,592,395 3,449,430
Costs net of estimated gross
loss in excess of billings on
contracts in process 3,931,056 4,153,569
Inventories 308,977 308,977
Prepaid expenses and other
current assets 198,668 97,289
Total Current assets 9,084,511 8,291,986
PROPERTY, PLANT AND EQUIPMENT, NET 14,938,198 16,146,059
PERISHABLE TOOLING 540,818 572,822
OTHER ASSETS 178,060 135,770
Total assets $24,741,587 $25,146,637
LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $7,292,683 $1,875,631
Accounts payable 575,775 898,212
Accrued liabilities 578,281 342,007
Total Current liabilities 8,446,739 3,115,850
LONG-TERM DEBT 2,759,466 6,526,729
ACCRUED LEASE EXPENSE 679,825 692,094
Total liabilities 11,886,030 10,334,673
PREFERRED STOCK - no par value,
$100 mandatory redemption value:
Authorized - 5,000 shares
Issued and outstanding - no shares - -
STOCKHOLDERS' EQUITY:
Preferred stock - no par value,
Authorized - 200,000 shares
Issued and outstanding - no shares - -
Common stock - No par value:
Authorized - 9,785,575 shares 1
Issued and outstanding - 3,379,609
shares at May 31, 2002 and
August 31, 2001 15,115,466 15,115,466
Retained deficit (2,259,909) (303,502)
Total stockholders' equity 12,855,557 14,811,964
Total liabilities and
stockholders' equity $24,741,587 $25,146,637
RIVIERA TOOL COMPANY
STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Three Months For The Nine Months
Ended May 31, Ended May 31,
2002 2001 2002 2001
SALES $3,702,425 $2,301,545 $10,518,181 $9,279,578
COST OF SALES 3,565,402 3,149,592 10,704,359 11,208,182
GROSS PROFIT/
(LOSS) 137,023 (848,047) (186,178) (1,928,604)
SELLING AND
ADMINISTRATIVE
EXPENSES 440,943 427,070 1,284,749 1,276,818
LOSS FROM
OPERATIONS (303,920) (1,275,117) (1,470,927) (3,205,422)
OTHER INCOME (EXPENSE)
Interest expense (149,769) (146,882) (486,748) (602,978)
Other Income/
(expense) 1,057 - 1,268 (98)
TOTAL OTHER
EXPENSE - NET (148,712) (146,882) (485,480) (603,076)
LOSS BEFORE TAXES
ON INCOME (452,632) (1,421,999) (1,956,407) (3,808,498)
INCOME TAX CREDIT - (483,480) - (1,294,889)
NET LOSS AVAILABLE
FOR COMMON SHARES $(452,632) $(938,519) $(1,956,407) $(2,513,609)
BASIC AND DILUTED
LOSS PER COMMON SHARE $(.13) $(.28) $(.58) $(.74)
BASIC AND DILUTED
COMMON SHARES
OUTSTANDING 3,379,609 3,379,609 3,379,609 3,379,609
RIVIERA TOOL COMPANY
STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the Nine Months Ended
May 31,
2002 2001
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(1,956,407) $(2,513,609)
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation and amortization 1,432,323 1,428,632
Deferred taxes - (1,294,890)
(Increase) decrease in assets:
Accounts receivable (1,142,965) 1,458,004
Federal income tax receivable - 673,897
Costs and estimated gross loss in
excess of billings on contracts in
process 222,513 5,852,881
Perishable tooling 32,004 (36,424)
Prepaid expenses and
other current assets (101,378) 88,234
Increase (decrease) in liabilities:
Accounts payable (322,437) (895,099)
Accrued lease expense (12,269) 1,752
Accrued liabilities 236,274 158,498
Net cash provided by/(used in)
operating activities $(1,612,342) $4,921,876
CASH FLOWS FROM INVESTING ACTIVITIES
Increase in other assets (42,290) 75,000
Additions to property, plant and equipment (224,463) (554,810)
Net cash provided by/(used in)
investing activities $(266,753) $(479,810)
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings (repayments)on revolving
credit line 2,761,763 (3,072,429)
Principal payments on notes payable
to bank and non-revolving equipment
line of credit (1,111,974) (1,449,032)
Net cash provided by/(used in)
financing activities $1,649,789 $(4,521,461)
NET DECREASE IN CASH $(229,306) $(79,395)
CASH - Beginning of Period 282,721 113,699
CASH - End of Period $53,415 $34,304