Riviera Tool Reports Sharply Higher Sales, Income for Fiscal Third Quarter
GRAND RAPIDS, Mich., July 15 -- Riviera Tool Co. (AMEX:RTC) today reported strong increases in net sales and net income for the third quarter of fiscal 2003.
The Grand Rapids, Mich. designer and manufacturer of stamping die systems reported net sales of $9.9 million for the quarter ended May 31, 2003, an increase of 168 percent over the net sales of $3.7 million for the same period in fiscal 2002. Riviera attributed the improvement to increased production on new contracts awarded the second half of fiscal 2002.
The Company also reported it secured $5.6 million in new contracts during the just-completed quarter, pushing its contract backlog to $26.1 million as of May 31, 2003. This represents a 20 percent increase over the year-ago backlog and reflects follow-on orders from Mercedes and BMW.
Riviera reported net income of $391,099, or $0.12 per diluted share, for the fiscal 2003 third quarter, reversing a net loss of $452,632, or $0.13 per diluted share, for the same period in fiscal 2002. Riviera said increased production on new contracts and improved efficiency helped boost profitability by nearly $845,000 over the year-ago quarter.
For the first nine months of fiscal 2003, Riviera reported net sales of $22.6 million, an increase of 115 percent over the $10.5 million in net sales for the same period in fiscal 2002. The Company also reported net income of $433,533, or $0.13 per diluted share, for the first nine months of fiscal 2003, reversing a net loss of $2.0 million, or $0.58 per diluted share, for the year-ago period.
"We have built considerable momentum during the first nine months of fiscal 2003, and are very pleased to report continued increases in sales and income for the third quarter of fiscal 2003," said Kenneth K. Rieth, president and chief executive officer of Riviera Tool. "A solid backlog, incoming new orders and continued quoting activity should allow us to finish fiscal 2003 on a strong note.
"Our business model, which relies on developing global partnerships to meet our customers' demands, is allowing us to meet the challenges of our changing industry. We are well positioned to take advantage of new automotive programs that are scheduled to be released in the coming months."
Riviera generated $2.7 million in cash flow from operating activities during the just-completed third quarter, more than triple its operating cash flow of the same period a year ago. Increased cash flow, combined with efforts to manage working capital, enabled the Company to reduce its long-term debt by nearly $2.5 million during the third quarter of fiscal 2003.
Riviera said increased production levels, combined with improved efficiency, resulted in improved margins and profitability. Riviera reported a gross margin of 11.0 percent for the third quarter of fiscal 2003, an increase of 730 basis points over the year-ago period. Direct labor expense decreased as a percent of sales from 23.6 percent in the year-ago period to 17.2 percent in the just-completed third quarter. The same was true for manufacturing overhead, which decreased from 42.7 percent for the 2002 third quarter to 17.5 percent for the just-completed quarter.
"We are maintaining tight control of expenses and focusing on productivity in order to maximize the upswing in orders and overall improvement in the industry," said Peter C. Canepa, chief financial officer for Riviera Tool. "As our revenues grow, we remain committed to controlling costs in order to maintain our strong balance sheet and increase our profitability. These measures, in addition to securing new orders, will allow us to maximize shareholder value."
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
STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Three Months For The Nine Months
Ended Ended
May 31,
2003 2002 2003 2002
SALES $9,919,178 $3,702,425 $22,561,901 $10,518,181
COST OF SALES 8,826,409 3,565,402 20,306,338 10,704,359
GROSS PROFIT
(LOSS) 1,092,769 137,023 2,255,563 (186,178)
SELLING AND
ADMINISTRATIVE
EXPENSES 505,935 440,943 1,244,540 1,284,749
INCOME (LOSS) FROM
OPERATIONS 586,834 (303,920) 1,011,023 (1,470,927)
OTHER EXPENSE:
Interest
expense 118,330 149,769 417,315 486,748
Other (Income)
/expense) 77,405 (1,057) 160,175 (1,268)
TOTAL OTHER
EXPENSE -
NET 195,735 148,712 577,490 485,480
INCOME (LOSS) BEFORE
TAXES ON INCOME 391,099 (452,632) 433,533 (1,956,407)
INCOME TAXES - - - -
NET INCOME (LOSS)
AVAILABLE FOR
COMMON SHARES $391,099 $(452,632) $433,533 $(1,956,407)
BASIC AND DILUTED
INCOME (LOSS) PER
COMMON SHARE $.12 $(.13) $.13 $(.58)
BASIC AND DILUTED
COMMON SHARES
OUTSTANDING 3,379,609 3,379,609 3,379,609 3,379,609
RIVIERA TOOL COMPANY
FINANCIAL STATEMENTS
BALANCE SHEETS
ASSETS May 31, August 31,
2003 2002
CURRENT ASSETS (unaudited) (audited)
Cash $- $2,337,743
Accounts receivable 4,893,681 2,899,075
Costs in excess of billings on
contracts in process 6,885,947 3,988,346
Inventories 250,569 250,569
Prepaid expenses and other current assets 357,470 184,313
Total Current assets 12,387,667 9,660,046
PROPERTY, PLANT AND EQUIPMENT, NET 13,272,485 14,471,879
PERISHABLE TOOLING 616,901 548,606
OTHER ASSETS 325,198 303,060
Total assets $26,602,251 $24,983,591
LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $231,805 $10,354,499
Notes payable 6,153,371
Accounts payable 6,393,653 1,694,779
Accrued liabilities 930,031 448,171
Total Current liabilities 13,708,860 12,497,449
LONG-TERM DEBT - -
ACCRUED LEASE EXPENSE 649,451 675,735
Total liabilities 14,358,311 13,173,184
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
Issued and outstanding - 3,379,609 shares
at May 31, 2003 and August 31, 2002 15,115,466 15,115,466
Retained deficit (2,871,526) (3,305,059)
Total stockholders' equity 12,243,940 11,810,407
Total liabilities and stockholders'
equity $26,602,251 $24,983,591
RIVIERA TOOL COMPANY
STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the Three Months For the Nine Months
Ended Ended
May 31,
2003 2002 2003 2002
CASH FLOWS FROM
OPERATING ACTIVITIES
Net income/(loss) $391,099 $(452,632) $433,533 $(1,956,407)
Adjustments to reconcile
net income/(loss) to net cash
from operating activities:
Depreciation and
amortization 460,482 477,441 1,381,446 1,432,323
(Increase) decrease in assets:
Accounts
receivable 4,825,325 890,849 (1,994,606) (1,142,965)
Costs in excess of
billings on
contracts
in process (5,440,988) 98,040 (2,897,601) 222,513
Perishable
tooling (34,650) (6,198) (68,295) 32,004
Prepaid expenses and
other current
assets 20,061 (65,952) (173,157) (101,378)
Increase (decrease) in
liabilities:
Accounts
payable 2,122,045 (88,699) 4,698,874 (322,437)
Accrued
liabilities 397,135 23,222 481,860 236,274
Accrued lease
expense (8,761) (4,089) (26,284) (12,269)
Net cash provided by/
(used in) operating
activities $2,731,748 $871,982 $1,835,770 $(1,612,342)
CASH FLOWS FROM INVESTING ACTIVITIES
Increase in other assets - - (22,138) (42,290)
Additions to property,
plant and
equipment (121,706) (186,545) (182,052) (224,463)
Net cash used in
investing
activities $(121,706) $(186,545) $(204,190) $(266,753)
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings (repayments)
on revolving credit
line (2,454,658) (594,964) (3,327,388) 2,761,763
Issuance of debt - - 3,367,948 -
Principal payments on notes
payable to bank and
non-revolving equipment
line of credit (155,384) (183,991) (4,009,883) (1,111,974)
Net cash provided by/
(used in) financing
activities $(2,610,042) (778,955) $(3,969,323) $1,649,789
NET INCREASE/(DECREASE)
IN CASH $- (93,518) $(2,337,743) $(229,306)
CASH - Beginning of Period - 146,934 2,337,743 282,722
CASH - End of Period $- 53,416 $- $53,416