Riviera Tool Reports First Quarter Results
GRAND RAPIDS, Mich., Jan. 17, 2006 -- Riviera Tool Co. (AMEX:RTC) today reported financial results for the first quarter ended November 30, 2005.
The Grand Rapids, Mich. designer and manufacturer of stamping die systems reported net sales of $6.1 million for the first quarter of 2006, compared with net sales of $4.6 million for first quarter of 2005, an increase of 33%. This increase was a result of the Company having higher levels of contract backlog at the end of fiscal 2005 as compared to fiscal 2004. The Company's backlog as of August 31, 2005 was $13.7 million as compared to $2.5 million in 2004 and $12.9 million as of November 30, 2005 as compared to $4.6 million as of November 30, 2004, an increase of 180%.
Riviera reported a net loss of $441,000, or $0.11 per diluted share, for first quarter 2006, as compared to a loss of $465,000, or $.12 per share, for the same period in fiscal 2005. For the first quarter of 2006 the Company reported operating income of $30,000 as compared to an operating loss of $65,000 for the first quarter of 2005.
In addition, the Company reported that it was awarded several substantial new contracts throughout the first quarter and the month of December totaling approximately $8.4 million. "The first quarter appears to be a watershed reporting period for the Company," said Kenneth K. Rieth, president and chief executive officer of Riviera Tool. "We entered fiscal year 2006 with a stronger backlog than the previous year and a significant number of these new programs were released for production toward the end of the quarter. As such, contribution margins will increase significantly in the next several quarters."
Responding to increased production requirements, Riviera further reported hiring 10 additional people since the beginning of the first quarter.
According to Peter Canepa, the Company's chief financial officer, "We are pleased with the progress being made related to the direct cost of production which has improved approximately 30% over the past 18 months. During this period, 95% of our contracts completed contributed positively to profit margins. However, as a result of our low contract backlog level entering into fiscal 2005 it was difficult to produce the sales volumes necessary to achieve year-end profitability." He further indicated, "We remain extremely focused on increasing revenue and lowering costs to produce a foundation for sustainable long-term profitability."
About Riviera Tool
Riviera Tool Co. (http://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 BMW, Nissan, DaimlerChrysler, General Motors Corp., 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 November 30, August 31,
2005 2005
CURRENT ASSETS (unaudited)
Cash $277,685 $239,475
Accounts receivable, net 7,631,090 5,232,138
Costs in excess of billings on contracts
in process 1,715,883 2,844,444
Inventories 236,437 236,437
Prepaid expenses and other current assets 382,183 453,597
Total current assets 10,243,278 9,006,091
PROPERTY, PLANT AND EQUIPMENT, NET 10,533,810 10,902,845
PERISHABLE TOOLING 703,519 708,319
OTHER ASSETS 563,327 599,344
Total assets $22,043,934 $21,216,599
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $3,206,186 $3,287,510
Accounts payable 3,932,334 3,517,578
Accrued liabilities 670,069 661,833
Total current liabilities 7,808,589 7,466,921
LONG-TERM AND SUBORDINATED DEBT, NET OF
UNAMORTIZED DISCOUNT 9,784,549 8,870,045
ACCRUED LEASE EXPENSE 910,398 897,885
Total liabilities 18,503,536 17,234,851
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 - 3,984,874 shares
as of November 30 and August 31, 2005 17,130,483 17,130,483
Retained deficit (13,590,085) (13,148,735)
Total stockholders' equity 3,540,398 3,981,748
Total liabilities and stockholders' equity $22,043,934 $21,216,599
RIVIERA TOOL COMPANY
STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Three Months Ended
November 30
2005 2004
SALES $6,063,185 $4,552,551
COST OF SALES 5,467,385 4,038,460
GROSS PROFIT 595,800 514,091
SELLING AND ADMINISTRATIVE EXPENSES 565,577 579,341
PROFIT (LOSS) FROM OPERATIONS 30,223 (65,250)
OTHER EXPENSE
Interest expense 464,918 393,163
Other expense 6,655 6,227
TOTAL OTHER EXPENSE 471,573 399,390
LOSS BEFORE INCOME TAX EXPENSE (441,350) (464,640)
INCOME TAX EXPENSE - -
NET LOSS AVAILABLE FOR COMMON SHARES $(441,350) $(464,640)
BASIC AND DILUTED INCOME/(LOSS) PER COMMON SHARE $(.11) $(.12)
WEIGHTED-AVERAGE BASIC AND DILUTED
COMMON SHARES OUTSTANDING 3,984,874 3,774,346
RIVIERA TOOL COMPANY
STATEMENT OF CASH FLOWS
(UNAUDITED)
For the Three Months Ended
November 30,
2005 2004
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(441,350) $(464,640)
Adjustments to reconcile net loss to net
cash from operating activities:
Depreciation and amortization 419,890 427,701
(Increase) decrease in assets:
Accounts receivable (2,398,952) 3,717,570
Costs in excess of billings on
contracts in process 1,128,561 (806,568)
Perishable tooling 4,800 (54,150)
Prepaid expenses and other current
assets 71,414 27,737
Increase (decrease) in liabilities:
Accounts payable 414,756 (992,895)
Accrued lease expense 12,513 23,292
Accrued liabilities 8,236 119,263
Net cash (used in) provided by operating
activities $(780,132) $1,997,310
CASH FLOWS FROM INVESTING ACTIVITIES
Increase (decrease) in other assets 36,017 (20,546)
Additions to property, plant and equipment (28,105) (230,283)
Net cash provided by (used in) investing
activities $7,912 $(250,829)
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings (repayments) on revolving
credit line 1,103,256 (747,696)
Principal payments on notes payable to
bank and non-revolving equipment line
of credit (292,826) (162,468)
Deferred interest - 45,912
Net cash provided by (used in) financing
activities $810,430 $(864,252)
NET INCREASE IN CASH $38,210 $882,229
CASH - Beginning of Period 239,475 1,200
CASH - End of Period $277,685 $883,429