CHARLOTTE, Mich., Feb. 12, 2013 /PRNewswire/ -- Spartan Motors,
Inc. (NASDAQ: SPAR) ("Spartan" or the "Company") today announced
operating results for the fourth quarter and full year of
2012. Revenues totaled $124.5
million compared to $111.2
million in the fourth quarter of 2011, an increase of
12.0%. Spartan reported a net loss of $2.5 million in the fourth quarter of 2012, or
($0.07) per diluted share compared to
net income of $0.7 million, or
$0.02 per diluted share in the fourth
quarter of 2011. Excluding pre-tax restructuring charges of
$1.4 million and a $1.9 million earn-out accrual related to the 2009
purchase of Utilimaster, Spartan posted an adjusted net income of
$0.5 million, or $0.01 per diluted share in the fourth quarter of
2012.
For the full year, Spartan posted revenue of $470.6 million, an increase of 10.5% from 2011
revenue of $426.0 million. The
Company reported a net loss of $2.5
million, or ($0.07) per
diluted share compared to net income of $0.8
million, or $0.02 per diluted
share in 2011. Results for 2012 include pre-tax restructuring
charges of $9.1 million and an
earn-out accrual of $2.9 million
while for 2011 Spartan incurred pre-tax restructuring charges of
$2.8 million and a $1.0 million earn-out accrual. On an
adjusted basis, excluding restructuring charges and the Utilimaster
earn-out, Spartan's 2012 earnings were $6.3
million, or $0.19 per diluted
share compared to $3.6 million, or
$0.11 per diluted share in 2011, an
increase of 75.0%.
Fourth Quarter 2012 Summary:
- Net sales of $124.5 million (an
increase of 12% from Q4 2011 sales of $111.2
million):
- Emergency Response (ER) sales totaled $44.9 million, an increase of 1.4% from
$44.3 million in Q4 2011
- Delivery & Service Vehicle (DSV) sales totaled $52.6 million, an increase of 25.5% from
$41.9 million in Q4 2011
- Specialty Vehicles (SV) sales rose 8.0% to $27.0 million from $25.0
million in Q4 2011
- GAAP results:
- Gross margin of 10.6% of sales, down from 13.1% in Q4 2011
- Operating loss of $2.8 million
and operating margin of (2.2)%, compared to operating income of
$1.0 million and operating margin of
0.9% in Q4 2011
- Net loss of $2.5 million, or
($0.07) per diluted share
- Adjusted operating results (non-GAAP, excluding restructuring
charges and earn-out accrual):
- Adjusted gross margin of 11.2% of sales
- Adjusted operating income of $0.5
million, or 0.4 % of sales
- Adjusted net income of $0.5
million, or $0.01 per diluted
share
- Restructuring charges (pre-tax) totaled $1.4 million, or $0.03 per diluted share in Q4 2012, mostly
related to Utilimaster's move to Bristol,
Ind.
- The Utilimaster earn-out accrual totaled $1.9 million, or $0.05 per share in Q4 2012
- Earnings before interest, taxes, depreciation and amortization
(EBITDA) excluding restructuring items and the earn-out accrual was
$2.6 million in Q4 2012 versus
$3.5 million in Q4 2011
- Ending consolidated backlog was $164.4
million at Dec. 31, 2012
versus $137.0 million at Dec. 31, 2011. Backlog at the end of 2012
increased 20.0% from the end of 2011
- Cash balance of $21.7 million at
Dec. 31, 2012 compared to
$31.7 million at Dec. 31, 2011
- Spartan invested $2.8 million in
capital during the fourth quarter of 2012, most of which was
related to Utilimaster's relocation project. During the
quarter the Company also purchased $9.6
million in transitional 2010-spec diesel engines
John Sztykiel, Chief Executive
Officer of Spartan Motors, Inc., stated, "The fourth quarter and
full year 2012 reflected Spartan's diversified growth strategy,
with fourth-quarter revenues rising 12% over last year and
full-year revenues up 10.5% from 2011. We also posted
full-year adjusted earnings growth compared to 2011 and a total
order backlog that increased 20.0% from year end 2011.
Revenue growth was a result of Spartan's brand strength, new
product initiatives and market recovery. In addition to
generating revenue growth, we did a very good job of managing
operating expenses and the balance sheet. Although we posted
sales and adjusted earnings growth in 2012, our results also show
that we have more work to do on improving operations, particularly
the gross margin. We underestimated the scope and amount of
time required to implement our operational/gross margin improvement
efforts in 2012 and are dedicating more time and focus to achieve
these goals in 2013. Our plan to improve the gross margin
includes the following steps: increasing production efficiency,
reducing the bill of materials to offset a shift to lower-priced
products and further reductions in Reach™ start-up costs. We
expect the plan to lead to improved margin performance in 2013 and
beyond."
Joe Nowicki, Spartan's Chief
Financial Officer, stated, "Spartan demonstrated its commitment to
financial discipline during the fourth quarter by cutting adjusted
operating expenses to 10.8% of sales compared to 12.2% of sales in
the fourth quarter of 2011. We focused attention on cash
collection and helped reduce our year end receivables balance by
$2.9 million compared to the third
quarter of 2012 despite 10%-plus revenue growth. Compared to
the third quarter of 2012, we also reduced total inventory levels
by $3.2 million.
"At the end of November, we renewed our private shelf and note
purchase agreement with Prudential Investment Management, Inc. for
an additional three-year period, through November 2015 and increased the authorized amount
of the note purchase agreement by $5
million, to $50 million.
This private shelf agreement provides Spartan with additional
flexibility to support future acquisitions or other growth
initiatives."
Revenue Growth and Operating Expense Control Offset by
Material and Manufacturing Cost Pressure
- All of Spartan's operating segments posted revenue growth in
the fourth quarter of 2012, with the DSV group showing a 25.5%
growth rate over the year-ago fourth quarter. DSV posted
fourth quarter 2012 revenue of $52.6
million compared to $41.9
million in the fourth quarter of 2011. Growth in the
DSV segment was due to increased demand for walk-in vans and truck
bodies. At the end of the fourth quarter of 2012, DSV backlog
stood at $39.7 million, down from
$47.7 million at the end of
2011.
- The SV segment generated revenue of $27.0 million in the fourth quarter of 2012, an
increase of 8.0% from $25.0 million
in the year-ago fourth quarter. Most of the revenue gain came
from higher sales of recreational vehicle chassis in the fourth
quarter of 2012 compared to the fourth quarter of 2011.
Demand for custom RV chassis increased during the fourth quarter of
2012, more than offsetting the impact of the departure of a major
customer earlier in the year. Orders increased dramatically
throughout 2012, with the backlog at year end standing at
$26.6 million compared to
$15.3 million at the end of 2011, an
increase of 73.9%.
- The ER segment reported fourth quarter 2012 revenue of
$44.9 million versus $44.3 million in the year-ago fourth
quarter. Sales of fire trucks, including two large aerials,
rose during the fourth quarter of 2012, more than offsetting a
small decline in the number of custom fire chassis sold during the
quarter. ER orders increased throughout the year, with the
backlog at December 31, 2012 standing
at $98.1 million, up 32.6% from
$74.0 million at year end
2011.
- Spartan's gross margin was adversely impacted by several issues
during the fourth quarter. The Company posted a gross margin
of 10.6% in the fourth quarter of 2012 compared to 13.1% in the
fourth quarter of 2011. Excluding restructuring charges of
$0.8 million, the adjusted gross
margin in the fourth quarter of 2012 was 11.2% of sales. The
gross margin was negatively impacted by higher-than-projected labor
costs at DSV due to the relocation to Bristol and higher Emergency Response Vehicles
labor costs incurred as production increased rapidly in the fourth
quarter of 2012. Product mix in Emergency Response Vehicles
during the quarter resulted in a higher material content as a
percentage of sales, thereby reducing gross margin. The gross
margin at ER was also reduced by recurring commercial chassis
shortages that required last-minute production schedule changes and
additional labor and material handling.
- Operating expenses in the fourth quarter of 2012 rose to
$15.9 million, or 12.8% of sales,
compared to $13.5 million, or 12.1%
of sales, in the fourth quarter of 2011. Excluding
restructuring charges of $0.6
million, or 0.5% of sales, and the earn-out expense of
$1.9 million, or 1.5% of sales,
adjusted operating expenses for the fourth quarter of 2012 amounted
to $13.4 million, or 10.8% of sales.
Bristol Move Accelerating
- Utilimaster's relocation to Bristol,
Ind., continues, with most of the physical move to be
completed by the end of the first quarter of 2013. Production
of walk-in vans is expected to begin at the end of Q1 2013 with the
move substantially completed during Q2 2013. While the move
is underway, costs are expected to be higher than normal while
production will be reduced, negatively impacting Q1 2013
results. As the relocation process nears completion,
management expects costs to be significantly reduced.
- Spartan closed the sale on 15 of the 16 buildings at its
Wakarusa, Ind., complex. The
Company retains one building at Wakarusa, currently held for sale.
2012 Highlights:
- Full year 2012 revenue at ER reached $162.3 million compared to $154.8 million in 2011, a 4.8% increase.
Emergency Response Vehicles posted a $4.8
million increase for the year, primarily during the fourth
quarter as production increased to meet order growth. The
Emergency Response Chassis unit reported revenue growth of
$2.8 million for the year as demand
for custom fire chassis also increased throughout the
year.
- DSV sales rose to $208.2 million
in 2012, up 25.8% from $165.5 million
in 2011. Sales of truck bodies and walk-in vans rose from
2011 due to improved demand. During the year, DSV sold 577
Reach walk-in vans. Aftermarket parts and field service
solutions sales rose to $58.0 million
from $46.7 million, an increase of
24.2%.
- SV revenue for 2012 declined to $100.0
million from $105.7 million in
2011, a decrease of 5.4%. The decline was due to an 89.0%
decrease in Specialty Defense and Government (SDG) vehicle
production to $1.3 million in 2012
from $11.8 million in 2011.
Partially offsetting this decline was a 10% increase in
Recreational and Specialty Chassis (RSC) sales to $72.1 million from $65.8
million in 2011.
- Consolidated gross profit in 2012 declined to $58.6 million, or 12.5% of sales, from
$60.6 million, or 14.2% of sales in
2011. Restructuring charges reduced gross profit by
$6.5 million in 2012 versus
$1.7 million in 2011. Adjusted
gross margin, excluding restructuring charges, was 13.8% of sales
in 2012 compared to 14.6% in 2011. Spartan's 2012 gross
profit was reduced by higher material content and labor costs than
projected at both ER and DSV, especially during the second half of
the year. SV posted higher gross profit and margin despite a
reduction in revenue as cost-cutting efforts, lower restructuring
costs and improved operating efficiency more than offset higher
material content due to sales mix.
- Operating expenses for 2012 increased to $61.2 million from $59.3
million, but declined as a percentage of sales to 13.0% from
13.9% in 2011. Operating expenses included restructuring
charges of $2.6 million in 2012
versus $1.1 million in 2011.
Also included in operating expenses is the Utilimaster earn-out
accrual of $2.9 million in 2012 and
$1.0 million in 2011. Excluding
restructuring charges and the earn-out accrual yields adjusted
operating expenses of 11.8% of sales in 2012 and 13.4% in
2011.
- Spartan posted an operating loss of $2.6
million or (0.6)% of sales in 2012, compared to operating
income of $1.3 million or 0.3% of
sales in 2011. Excluding restructuring items and earn-out
accruals, Spartan's adjusted operating earnings totaled
$9.4 million, or 2.0% of sales,
compared to $5.1 million, or 1.2% of
sales in 2011, representing an increase of 84.3%.
Joe Nowicki, Spartan's Chief
Financial Officer, commented on the Company's 2012 performance and
outlook for 2013, "Spartan ended 2012 on a sound financial footing
and with important initiatives such as Utilimaster's relocation to
a more efficient facility on-track and on schedule. We
transitioned production of the Reach to the Charlotte campus from Wakarusa and completed our first run of 150
units for UPS. We reduced our base inventory levels, which
exclude the purchase of $9.6 million
of transitional diesel engines, by $9.0
million from the end of 2011.
"In the first quarter of 2013, we expect Utilimaster's move to
Bristol to adversely impact
production levels at our DSV unit. In addition, the industry
is experiencing a shortage of certain stripped chassis used in
walk-in van production. We are working with other chassis
manufacturers and our customers to mitigate the impact of the
shortage, which we expect to be an issue primarily in the first
half of 2013. Our other operating segments are also
expected to experience seasonally lower production rates during the
first quarter. Because of lower production rates and the
costs of the Bristol relocation
project, we expect to post an operating loss for the first quarter
of 2013. For the remainder of 2013 we expect improved
financial results from the completion of the Bristol move, ramp-up of DSV production and
our gross margin improvement plan."
Margin Improvement is Focus for 2013
John Sztykiel commented on plans
for 2013, stating, "As we enter 2013, revenue growth, expense
control, the strength of our balance sheet and our strategy are all
making an impact. The Reach has been established as a product
valued by the market and we are excited about its future.
During 2012 we sold 577 units, including to UPS and Fedex, and are
very excited about its future. Operational improvement will
come as we implement production efficiency initiatives throughout
the company and reduce bill of materials costs. We are also
putting into place marketing initiatives to shift our product mix
to higher-margin products.
"The year 2012 was still a year of transformation. We
still managed to post revenue, profit and backlog growth in the
midst of all of our transformational activities. Spartan ER
came into play as the Crimson Fire brand was eliminated. We
moved Reach production to Charlotte and saw improvements in efficiency
and quality in the fourth quarter. The first quarter of 2013
will still be a transformational quarter as we complete the move of
Utilimaster to Bristol. As we look at all of 2013, we see top
line growth supported by disciplined execution and operational
improvement. In summary, we look for structured growth while
positioning Spartan for an even better future."
Reconciliation of Non-GAAP Financial Measures
This release contains adjusted gross profit, adjusted gross
margin, adjusted operating expenses, adjusted operating income,
adjusted net earnings (loss) and adjusted earnings per share
measures, as well as earnings before interest, taxes, depreciation
and amortization (EBITDA), which are all Non-GAAP financial
measures. These are calculated by excluding items that we believe
to be infrequent or not indicative of our operating
performance. For the periods covered by this release such
items consist of expenses associated with restructuring actions
taken to improve the efficiency and profitability of certain of our
manufacturing operations and adjust our cost structure to the
current business climate and earn-out accruals related to our 2009
acquisition of Utilimaster Corporation. We present these
adjusted Non-GAAP measures because we consider them to be important
supplemental measures of our performance and believe them to be
useful to show ongoing results from operations distinct from items
that are infrequent or not indicative of our operating
performance. We define EBITDA as operating income (loss)
excluding restructuring and earn-out charges, less depreciation and
amortization. We believe EBITDA is a useful tool that allows
comparison of financial performance by eliminating the impact of
differences in capital structure, restructuring charges and capital
spending, among others, between different time periods or
industries.
The adjusted Non-GAAP measures are not measurements of our
financial performance under GAAP and should not be considered as an
alternative to gross profit, gross margin, operating expense,
operating income (loss), net earnings (loss) or earnings (loss) per
share under GAAP. These adjusted Non-GAAP measures have limitations
as analytical tools and should not be considered in isolation or as
a substitute for analysis of our results as reported under GAAP. In
addition, in evaluating the adjusted Non-GAAP measures, you should
be aware that in the future we may incur expenses similar to the
adjustments in this presentation, despite our assessment that such
expenses are infrequent or not indicative of our operating
performance. Our presentation of the adjusted Non-GAAP
measures should not be construed as an inference that our future
results will be unaffected by unusual or infrequent items. We
compensate for these limitations by providing equal prominence of
our GAAP results and using adjusted Non-GAAP measures only as a
supplement.
The following tables reconcile gross profit to adjusted gross
profit, gross margin to adjusted gross margin, operating income
(loss) to adjusted operating income, operating expense to adjusted
operating expense, net earnings (loss) to adjusted net earnings,
earnings (loss) per share to adjusted earnings per share and
operating income (loss) to EBITDA for the periods indicated.
Financial Summary (Non-GAAP)
|
(In
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
|
2012
|
% of
sales
|
|
2011
|
% of
sales
|
|
|
|
|
|
|
|
|
Cost of
products sold
|
$
110,583
|
88.8
|
|
$
96,680
|
86.9
|
|
Less: restructuring charges
|
754
|
0.6
|
|
-
|
-
|
|
Adjusted
cost of products sold
|
$
109,829
|
88.2
|
|
$
96,680
|
86.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit/Gross margin
|
$
13,152
|
10.6
|
|
$
14,531
|
13.1
|
|
Add
back: restructuring charges
|
754
|
0.6
|
|
-
|
-
|
|
Adjusted
gross profit/Adjusted gross margin
|
$
13,906
|
11.2
|
|
$
14,531
|
13.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
$
15,933
|
12.8
|
|
$
13,499
|
12.1
|
|
Less: restructuring charges
|
643
|
0.5
|
|
-
|
-
|
|
Less: expense from changes in fair value of
contingent consideration
|
1,906
|
1.5
|
|
(54)
|
(0.0)
|
|
Adjusted
operating expenses
|
$
13,384
|
10.8
|
|
$
13,553
|
12.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss)/Operating margin
|
$
(2,781)
|
(2.2)
|
|
$
1,032
|
0.9
|
|
Add
back: restructuring charges
|
1,397
|
1.1
|
|
-
|
-
|
|
Add
back: expense from changes in fair value of contingent
consideration
|
1,906
|
1.5
|
|
(54)
|
(0.0)
|
|
Adjusted
operating income/Adjusted operating margin
|
$
522
|
0.4
|
|
$
978
|
0.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(2,466)
|
(2.0)
|
|
$
694
|
0.6
|
|
Add
back: restructuring charges, net of tax
|
1,030
|
0.8
|
|
-
|
-
|
|
Add
back: expense from changes in fair value of contingent
consideration, net of tax
|
1,896
|
1.5
|
|
(54)
|
(0.0)
|
|
Adjusted
net income
|
$
460
|
0.4
|
|
$
640
|
0.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings (loss) per share - diluted
|
$
(0.07)
|
|
|
$
0.02
|
|
|
Add
back: restructuring charges, net of tax
|
0.03
|
|
|
-
|
|
|
Add
back: expense from changes in fair value of contingent
consideration, net of tax
|
0.05
|
|
|
-
|
|
|
Adjusted
net earnings per share - diluted
|
$
0.01
|
|
|
$
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss)
|
$
(2,781)
|
|
|
$
1,032
|
|
|
Add
back: restructuring charges
|
1,397
|
|
|
-
|
|
|
Add
back: expense from changes in fair value of contingent
consideration
|
1,906
|
|
|
(54)
|
|
|
Adjusted
operating income
|
522
|
|
|
978
|
|
|
Add back:
depreciation and amortization
|
2,120
|
|
|
2,521
|
|
|
Earnings
before interest, taxes, depreciation and amortization
|
$
2,642
|
|
|
$
3,499
|
|
|
Financial Summary (Non-GAAP)
|
(In
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Year
Ended December 31,
|
|
|
2012
|
% of
sales
|
|
2011
|
% of
sales
|
|
|
|
|
|
|
|
|
Cost of
products sold
|
$
405,455
|
86.2
|
|
$
363,662
|
85.4
|
|
Less: restructuring charges
|
6,514
|
1.4
|
|
1,731
|
0.4
|
|
Adjusted
cost of products sold
|
$
398,941
|
84.8
|
|
$
361,931
|
85.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit/Gross margin
|
$
58,608
|
12.5
|
|
$
60,617
|
14.2
|
|
Add
back: restructuring charges
|
6,514
|
1.4
|
|
1,731
|
0.4
|
|
Adjusted
gross profit/Adjusted gross margin
|
$
65,122
|
13.8
|
|
$
62,348
|
14.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
$
61,199
|
13.0
|
|
$
59,286
|
13.9
|
|
Less: restructuring charges
|
2,619
|
0.6
|
|
1,050
|
0.2
|
|
Less: expense from changes in fair value of
contingent consideration
|
2,872
|
0.6
|
|
983
|
0.2
|
|
Adjusted
operating expenses
|
$
55,708
|
11.8
|
|
$
57,253
|
13.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss)/Operating margin
|
$
(2,591)
|
(0.6)
|
|
$
1,331
|
0.3
|
|
Add
back: restructuring charges
|
9,133
|
1.9
|
|
2,781
|
0.7
|
|
Add
back: expense from changes in fair value of contingent
consideration
|
2,872
|
0.6
|
|
983
|
0.2
|
|
Adjusted
operating income/Adjusted operating margin
|
$
9,414
|
2.0
|
|
$
5,095
|
1.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
(2,457)
|
(0.5)
|
|
$
773
|
0.2
|
|
Add
back: restructuring charges, net of tax
|
5,898
|
1.3
|
|
1,851
|
0.4
|
|
Add
back: expense from changes in fair value of contingent
consideration, net of tax
|
2,862
|
0.6
|
|
983
|
0.2
|
|
Adjusted
net income
|
$
6,303
|
1.3
|
|
$
3,607
|
0.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings per share - basic and diluted
|
$
(0.07)
|
|
|
$
0.02
|
|
|
Add
back: restructuring charges, net of tax
|
$
0.18
|
|
|
0.06
|
|
|
Add
back: expense from changes in fair value of contingent
consideration, net of tax
|
$
0.08
|
|
|
0.03
|
|
|
Adjusted
net earnings per share - diluted
|
$
0.19
|
|
|
$
0.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss)
|
$
(2,591)
|
|
|
$
1,331
|
|
|
Add
back: restructuring charges
|
9,133
|
|
|
2,781
|
|
|
Add
back: expense from changes in fair value of contingent
consideration
|
2,872
|
|
|
983
|
|
|
Adjusted
operating income
|
9,414
|
|
|
5,095
|
|
|
Add back:
depreciation and amortization
|
8,990
|
|
|
10,010
|
|
|
Earnings
before interest, taxes, depreciation and amortization
|
$
18,404
|
|
|
$
15,105
|
|
|
Conference Call, Webcast and Roadcast®
Spartan Motors will host a conference call for analysts and
portfolio managers at 10 a.m. ET
today to discuss these results and current business trends. To
listen to a live webcast of the call, please visit
www.spartanmotors.com, click on "Shareholders," and then on
"Webcasts."
For more information about Spartan, please view the Company's
Roadcast "digital roadshow" designed for investors. To launch the
Spartan Motors Roadcast, please visit www.spartanmotors.com and
look for the "Virtual Road Show" link on the right side of the
page.
About Spartan Motors
Spartan Motors, Inc. designs, engineers and manufactures
specialty chassis, specialty vehicles, truck bodies and aftermarket
parts for the recreational vehicle (RV), emergency response,
government services, defense, and delivery and service markets. The
Company's brand names – Spartan™, Spartan Chassis™, Spartan ER™,
Spartan ERV™ and Utilimaster® - are known for quality, performance,
service and first-to-market innovation. The Company employs
approximately 1,800 associates at facilities in Michigan, Pennsylvania, South
Dakota, Indiana,
Florida and Texas. Spartan reported sales of $471 million in 2012 and is focused on becoming a
global leader in the design, engineering and manufacture of
specialty vehicles and chassis. Visit Spartan Motors at
www.spartanmotors.com.
This release contains several forward-looking statements that
are not historical facts, including statements concerning our
business, strategic position, financial strength, future plans,
objectives, and the performance of our products. These statements
can be identified by words such as "believe," "expect," "intend,"
"potential," "future," "may," "will," "should," and similar
expressions regarding future expectations. These
forward-looking statements involve various known and unknown risks,
uncertainties, and assumptions that are difficult to predict
with regard to timing, extent, and likelihood. Therefore,
actual performance and results may materially differ from what may
be expressed or forecasted in such forward-looking
statements. Factors that could contribute to these
differences include operational and other complications that may
arise affecting the implementation of our plans and business
objectives; continued pressures caused by economic conditions and
the pace and extent of the economic recovery; challenges that may
arise in connection with the integration of new businesses or
assets we acquire or the disposition of assets; restructuring of
our operations, and/or our expansion into new geographic markets;
issues unique to government contracting, such as competitive
bidding processes, qualification requirements, and delays or
changes in funding; disruptions within our dealer network; changes
in our relationships with major customers, suppliers, or other
business partners, including Isuzu; changes in the demand or supply
of products within our markets or raw materials needed to
manufacture those products; and changes in laws and regulations
affecting our business. Other factors that could affect
outcomes are set forth in our Annual Report on Form 10-K and other
filings we make with the Securities and Exchange Commission (SEC),
which are available at www.sec.gov or our website. All
forward-looking statements in this release are qualified by this
paragraph. Investors should not place undue reliance on
forward-looking statements as a prediction of actual results.
We undertake no obligation to publicly update or revise any
forward-looking statements in this release, whether as a result of
new information, future events, or otherwise.
Spartan
Motors, Inc. and Subsidiaries
|
Consolidated Statements of
Operations
|
(In
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
|
|
2012
|
|
% of
sales
|
|
2011
|
|
% of
sales
|
|
Sales
|
$
124,489
|
|
|
|
$
111,211
|
|
|
|
Cost of
products sold
|
110,583
|
|
88.8
|
|
96,680
|
|
86.9
|
|
Restructuring charges
|
754
|
|
0.6
|
|
-
|
|
-
|
|
Gross
profit
|
13,152
|
|
10.6
|
|
14,531
|
|
13.1
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research
and development
|
2,971
|
|
2.4
|
|
3,445
|
|
3.1
|
|
|
Selling,
general and administrative
|
12,319
|
|
9.9
|
|
10,054
|
|
9.0
|
|
|
Restructuring charges
|
643
|
|
0.5
|
|
-
|
|
-
|
|
Total
operating expenses
|
15,933
|
|
12.8
|
|
13,499
|
|
12.1
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
(2,781)
|
|
(2.2)
|
|
1,032
|
|
0.9
|
|
|
|
|
|
|
|
|
|
|
|
Other
income (expense):
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
(81)
|
|
(0.1)
|
|
(67)
|
|
(0.1)
|
|
|
Interest
and other income (expense)
|
134
|
|
0.1
|
|
191
|
|
0.2
|
|
Total
other income (expense)
|
53
|
|
0.0
|
|
124
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
Income
(loss) before taxes
|
(2,728)
|
|
(2.2)
|
|
1,156
|
|
1.0
|
|
|
|
|
|
|
|
|
|
|
|
Taxes
|
(262)
|
|
(0.2)
|
|
462
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings (loss)
|
(2,466)
|
|
(2.0)
|
|
694
|
|
0.6
|
|
|
|
|
|
|
|
|
|
|
|
Basic
net earnings (loss) per share
|
$
(0.07)
|
|
|
|
$
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
net earnings (loss) per share
|
$
(0.07)
|
|
|
|
$
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
weighted average common shares outstanding
|
33,251
|
|
|
|
33,596
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
weighted average common shares outstanding
|
33,251
|
|
|
|
33,613
|
|
|
|
Spartan
Motors, Inc. and Subsidiaries
|
Consolidated Statements of
Operations
|
(In
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
Ended December 31,
|
|
|
|
2012
|
|
% of
sales
|
|
2011
|
|
% of
sales
|
Sales
|
|
$
470,577
|
|
|
|
$
426,010
|
|
|
Cost of
products sold
|
|
405,455
|
|
86.2
|
|
363,662
|
|
85.4
|
Restructuring charges
|
|
6,514
|
|
1.4
|
|
1,731
|
|
0.4
|
Gross
profit
|
|
58,608
|
|
12.5
|
|
60,617
|
|
14.2
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research
and development
|
|
12,873
|
|
2.7
|
|
13,931
|
|
3.3
|
|
Selling,
general and administrative
|
|
45,707
|
|
9.7
|
|
44,305
|
|
10.4
|
|
Restructuring charges
|
|
2,619
|
|
0.6
|
|
1,050
|
|
0.2
|
Total
operating expenses
|
|
61,199
|
|
13.0
|
|
59,286
|
|
13.9
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
(2,591)
|
|
(0.6)
|
|
1,331
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
Other
income (expense):
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(335)
|
|
(0.1)
|
|
(324)
|
|
(0.1)
|
|
Interest
and other income (expense)
|
|
569
|
|
0.1
|
|
276
|
|
0.1
|
Total
other income (expense)
|
|
234
|
|
0.0
|
|
(48)
|
|
(0.0)
|
|
|
|
|
|
|
|
|
|
|
Income
(loss) before taxes
|
|
(2,357)
|
|
(0.5)
|
|
1,283
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
Taxes
|
|
100
|
|
0.0
|
|
510
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
Net
earnings (loss)
|
|
(2,457)
|
|
(0.5)
|
|
773
|
|
0.2
|
|
|
|
|
|
|
|
|
|
|
Basic
net earnings (loss) per share
|
|
$
(0.07)
|
|
|
|
$
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
net earnings (loss) per share
|
|
$
(0.07)
|
|
|
|
$
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
weighted average common shares outstanding
|
|
33,165
|
|
|
|
33,438
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
weighted average common shares outstanding
|
|
33,165
|
|
|
|
33,488
|
|
|
Spartan
Motors, Inc. and Subsidiaries
|
Consolidated Balance Sheets
|
(In
thousands, except par value)
|
|
(Unaudited)
|
|
|
|
December 31,
|
|
December 31,
|
|
2012
|
|
2011
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash equivalents
|
$
21,748
|
|
$
31,677
|
Accounts receivable, less allowance of $1,021 and
$749
|
47,139
|
|
40,042
|
Inventories
|
67,591
|
|
66,991
|
Deferred income tax assets
|
6,291
|
|
6,425
|
Income taxes receivable
|
3,011
|
|
1,479
|
Assets held for sale
|
716
|
|
-
|
Other current assets
|
6,027
|
|
2,455
|
Total current assets
|
152,523
|
|
149,069
|
|
|
|
|
Property, plant and equipment, net
|
59,122
|
|
65,399
|
Goodwill
|
20,815
|
|
20,815
|
Intangible assets, net
|
11,052
|
|
11,943
|
Other
assets
|
1,639
|
|
1,383
|
TOTAL
ASSETS
|
$
245,151
|
|
$
248,609
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts payable
|
$
23,000
|
|
$
21,649
|
Accrued warranty
|
6,062
|
|
5,802
|
Accrued customer rebates
|
2,299
|
|
1,546
|
Accrued compensation and related taxes
|
7,748
|
|
5,670
|
Deposits from customers
|
6,386
|
|
7,902
|
Other current liabilities and accrued
expenses
|
8,113
|
|
7,772
|
Current portion of long-term debt
|
82
|
|
55
|
Total current liabilities
|
53,690
|
|
50,396
|
|
|
|
|
Other
non-current liabilities
|
3,071
|
|
2,932
|
Long-term debt, less current
portion
|
5,207
|
|
5,084
|
Deferred income tax liabilities
|
4,454
|
|
7,359
|
|
|
|
|
Shareholders' equity:
|
|
|
|
Preferred stock, no par value: 2,000
|
|
|
|
shares authorized (none issued)
|
-
|
|
-
|
Common stock, $0.01 par value; 40,000 shares
authorized; 33,862 and 33,596 outstanding
|
339
|
|
336
|
Additional paid in capital
|
72,873
|
|
71,145
|
Retained earnings
|
105,517
|
|
111,357
|
Total shareholders' equity
|
178,729
|
|
182,838
|
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
245,151
|
|
$
248,609
|
Spartan
Motors, Inc. and Subsidiaries
|
Sales
and Other Financial Information by Business Segment
|
Unaudited
|
|
Three
Months Ended December 31, 2012 (amounts in thousands of
dollars)
|
|
|
|
|
|
|
Emergency
Response
|
|
Delivery
&
Service
Vehicles
|
|
Specialty
Vehicles
|
|
Other
|
|
Consolidated
|
Emergency
Response Chassis Sales
|
$
21,298
|
|
|
|
|
|
|
|
$
21,298
|
Emergency
Response Vehicle Sales
|
23,633
|
|
|
|
|
|
|
|
23,633
|
Utilimaster Vehicle Sales
|
|
|
46,496
|
|
|
|
|
|
46,496
|
Motorhome
Chassis Sales
|
|
|
|
|
20,413
|
|
|
|
20,413
|
Other
Specialty Vehicles
|
|
|
|
|
1,016
|
|
|
|
1,016
|
Aftermarket Parts and Assemblies
|
|
|
6,109
|
|
5,524
|
|
|
|
11,633
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
$
44,931
|
|
$
52,605
|
|
$
26,953
|
|
$
-
|
|
$
124,489
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization Expense
|
$
391
|
|
$
623
|
|
$
441
|
|
$
665
|
|
$
2,120
|
Operating
Income (Loss)
|
306
|
|
(2,122)
|
|
1,204
|
|
(2,169)
|
|
(2,781)
|
Segment
Assets
|
77,806
|
|
73,567
|
|
27,565
|
|
66,213
|
|
245,151
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
Ended December 31, 2012 (amounts in thousands of
dollars)
|
|
|
|
|
|
|
Emergency
Response
|
|
Delivery
&
Service
Vehicles
|
|
Specialty
Vehicles
|
|
Other
|
|
Consolidated
|
Emergency
Response Chassis Sales
|
$
83,576
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
83,576
|
Emergency
Response Body Sales
|
78,744
|
|
-
|
|
-
|
|
-
|
|
78,744
|
Utilimaster Vehicle Sales
|
-
|
|
150,255
|
|
-
|
|
-
|
|
150,255
|
Motorhome
Chassis Sales
|
-
|
|
-
|
|
72,127
|
|
-
|
|
72,127
|
Other
Specialty Vehicles
|
-
|
|
-
|
|
7,426
|
|
-
|
|
7,426
|
Aftermarket Parts and Assemblies
|
-
|
|
57,975
|
|
20,474
|
|
-
|
|
78,449
|
|
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
$
162,320
|
|
$
208,230
|
|
$
100,027
|
|
$
-
|
|
$
470,577
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization Expense
|
$
1,711
|
|
$
2,648
|
|
$
1,945
|
|
$
2,686
|
|
$
8,990
|
Operating
Income (Loss)
|
(2,951)
|
|
6,035
|
|
2,198
|
|
(7,873)
|
|
(2,591)
|
Segment
Assets
|
77,806
|
|
73,567
|
|
27,565
|
|
66,213
|
|
245,151
|
Spartan
Motors, Inc. and Subsidiaries
|
Sales
and Other Financial Information by Business Segment
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
Period
End Backlog (amounts in thousands of dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec.
31,
2011
|
|
March 31,
2012
|
|
June 30,
2012
|
|
Sept. 30, 2012
|
|
Dec.
31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Emergency Response
Chassis*
|
$
34,057
|
|
$
34,644
|
|
$
31,323
|
|
$32,454
|
|
$
37,005
|
Emergency Response
Vehicles*
|
39,942
|
|
47,517
|
|
51,979
|
|
53,458
|
|
61,133
|
|
Total
Emergency Response Backlog
|
73,999
|
|
82,161
|
|
83,302
|
|
85,912
|
|
98,138
|
|
|
|
|
|
|
|
|
|
|
|
Motorhome Chassis
*
|
10,018
|
|
10,712
|
|
10,885
|
|
12,863
|
|
13,453
|
Other Vehicles*
|
2,287
|
|
150
|
|
-
|
|
-
|
|
3,968
|
Aftermarket Parts and
Assemblies
|
2,955
|
|
2,610
|
|
3,989
|
|
4,536
|
|
9,179
|
|
Total
Specialty Vehicles Backlog
|
15,260
|
|
13,472
|
|
14,874
|
|
17,399
|
|
26,600
|
|
|
|
|
|
|
|
|
|
|
|
Delivery & Service
Vehicles *
|
47,694
|
|
40,032
|
|
75,116
|
|
65,026
|
|
39,656
|
Total
Backlog
|
$
136,953
|
|
$
135,665
|
|
173,292
|
|
168,337
|
|
164,394
|
|
|
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*
Anticipated time to fill backlog orders at December 31, 2012; 5
months or less for emergency response chassis; 7 months or less for
emergency response vehicles; 2 months or less for motorhome
chassis; 3 months or less for delivery and service vehicles; and 6
month or less for other products.
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Note: Effective with Q4 2012, eliminations for
intercompany orders of emergency response chassis are reflected in
the emergency response chassis sales and backlog figures.
Previously these eliminations were reflected in the emergency
response vehicles sales and backlog figures. Amounts for
prior quarters have been adjusted to reflect this
change.
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SOURCE Spartan Motors, Inc.