Supreme Industries Net Income ImprovesPosted: Updated:
Goshen-based Supreme Industries Inc. (NYSE: STS) has announced third quarter profit of nearly $2.5 million, compared to more than $1.5 million in the same period one year ago. Chief Executive Officer Mark Weber says the commercial vehicle manufacturer will offer investors a cash dividend for the first time since 2008. October 23, 2014
GOSHEN, Ind. - Supreme Industries, Inc. (NYSE MKT: STS), a leading manufacturer of specialized commercial vehicles including truck bodies, trolleys and specialty vehicles, today announced financial results for its third quarter ended September 27, 2014.
2014 Third Quarter Results
Consolidated net sales from continuing operations increased to $58.0 million in the third quarter of 2014, compared with $56.7 million last year. Net income per diluted share improved to $0.15 in the third quarter of 2014, versus $0.09 last year, which included a $1.0 million after-tax loss related to its discontinued shuttle bus operations.
"Medium-duty sales are showing continued strength, which is in line with related industry reports," said Mark Weber, President and Chief Executive Officer. "These customers are generally optimistic concerning their respective market conditions and anticipate continued growth well into 2015."
Gross profit from continuing operations in the quarter was $11.3 million, or 19.5% of sales, compared with $11.6 million, or 20.5% of sales, in the prior-year quarter. The decrease of $0.3 million is primarily due to product and customer mix.
Operating income from continuing operations was $3.8 million, compared with $4.0 million in last year's third quarter. Income tax expense was unchanged year-over-year at $1.2 million. Net income from continuing operations was $2.5 million, essentially unchanged from the same quarter a year ago. On a continuing operations basis, third quarter net income per diluted share was $0.15 in both years.
2014 Nine-Month Results
Consolidated net sales from continuing operations in the nine-month period increased to $183.0 million, up from $181.9 million last year.
Gross margin for the nine-months was 18.5% of sales, compared with 20.5% in the prior year. The lower margin reflects a chassis shortage and severe weather impact in the first quarter of 2014, and a higher mix of sales to fleet customers compared with last year. Correspondingly, gross profit declined to $33.8 million, compared with $37.2 million in last year’s comparable nine-month period.
Operating income was $10.6 million, compared with $14.4 million in 2013, and income from continuing operations was $6.9 million for the nine-months of 2014, down from $9.1 million last year.
The Company's discontinued shuttle bus operations generated a $1.6 million after-tax net loss during the current year nine-month period, compared with a loss of $4.3 million last year. Including the negative impact on 2013’s results from discontinued operations, reported net income improved to $5.4 million, or $0.32 per diluted share, up from reported net income of $4.8 million, or $0.29 per diluted share, in last year's comparable period.
"Throughout the first three quarters of 2014, we have made steady progress towards our strategic goals. We have actively addressed under-performing business units, invested capital to target growth and efficiency, and elevated customer focus across the organization. These initiatives have improved our financial performance allowing us to reinstate a cash dividend to shareholders for the first time since 2008," Weber said. "In addition, our new and innovative products employing our proprietary FiberPanel HC sidewalls are generating interest in the market. This recently translated into securing orders for trucks built with these new body panels. These internal efforts, combined with steady market demand, give us optimism as we close out 2014 and look ahead to next year."
Sales order backlog at the end of the quarter was $50.8 million, compared with $68.7 million at the end of the third quarter 2013. A major fleet customer ordered in the fall of 2013, elevating the backlog, but returned to their normal ordering pattern in the spring of 2014.
Additional financial highlights:
Cash and cash equivalents increased to $11.4 million, up from $3.9 million at December 28, 2013.
Net cash provided by operating activities during the 2014 nine-months was $6.3 million, compared with $2.3 million of net cash generated by operations in the same period of 2013.
Stockholders’ equity increased to $79.8 million at September 27, 2014, compared with $74.1 million at December 28, 2013.
Book value, on a per share basis, grew to $4.87 at quarter-end versus $4.59 at the end of 2013.
About Supreme Industries
Supreme Industries, Inc. (NYSE MKT: STS), is a nationwide manufacturer of truck bodies, trolleys 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.
Source: Supreme Industries Inc.