Riviera Tool (AMEX:RTC)
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Riviera Tool Reports Third Quarter Results
GRAND RAPIDS, Mich., July 15 /PRNewswire-FirstCall/ -- Riviera Tool Co.
(AMEX:RTC) today announced results for the third quarter ended May 31, 2005.
The Grand Rapids, Michigan-based designer and manufacturer of stamping die
systems reported a net loss of $775,816, or $0.20 per diluted share, on net
sales of $4.7 million for the third quarter of fiscal 2005, compared with net
income of $238,584, or $0.06 per diluted share, on net sales of $7.6 million
for the same period of fiscal 2004.
For the nine months ended, Riviera reported net sales of $14.2 million as
compared to last year's net sales of $24.2 million. The Company posted a net
loss of $1.7 million, or $0.44 per diluted share, for the first nine months of
fiscal 2005, versus net income of $688,597, or $0.18 per diluted share, for the
same period last year.
"Lower sales stemming from our lower backlog at the end of last quarter, along
with several one-time expenses related to our recent financing efforts, were
the primary reasons for the loss this quarter," said Kenneth K. Rieth,
president and chief executive officer of Riviera Tool. "However, we are
pleased with our improving gross margin and our current backlog of $11 million,
a 44 percent over the same period last year, which should lead to better
results in the next several quarters. Additionally, we don't anticipate fourth
quarter expenses related to our financing efforts completed in the third
quarter."
Riviera incurred higher interest expense due to increased debt levels during
the quarter and a non-cash expense of $304,424 associated with the retirement
of the $3.0 million subordinated debt incurred during the fourth quarter of
2004 prior to scheduled retirement. These fees and costs were originally paid
and capitalized and were being amortized over the original repayment
amortization of six years.
Cost of goods sold decreased as a percent of sales from 88.6 percent for 2004
to 87.6 percent for 2005 and gross margin improved from 11.4 percent in the
2004 third quarter to 12 percent in the current quarter. For nine months
ended, gross margin improved from 10.6 percent in the 2004 third quarter to
13.5 percent in the current quarter. As a percent of sales, selling and
administrative expense increased from 6.3 percent for 2004 to 14.1 percent for
2005 due to the lower sales volume and increase in certain one-time
professional advisory fees of $222,000 related to the Company's primary lender
requiring Riviera to retain the services of a consulting company and the
lender's legal counsel at the Company's expense.
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 Mercedes-Benz, 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
factors.
RIVIERA TOOL COMPANY
BALANCE SHEET
ASSETS May 31, August 31,
2005 2004
CURRENT ASSETS (unaudited) (audited)
Cash $369,612 $1,200
Accounts receivable 2,616,969 13,075,285
Costs in excess of billings on contracts
in process 3,405,159 669,143
Inventories 238,301 238,301
Prepaid expenses and other current assets 515,907 235,203
Total current assets 7,145,948 14,219,132
PROPERTY, PLANT AND EQUIPMENT, NET 11,299,806 12,328,746
PERISHABLE TOOLING 734,130 726,704
OTHER ASSETS 599,344 623,635
Total assets $19,779,228 $27,898,217
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $2,852,862 $15,742,669
Accounts payable 3,868,442 4,908,893
Accrued liabilities 731,546 521,193
Total current liabilities 7,452,850 21,172,755
LONG-TERM DEBT 6,698,852 12,703
ACCRUED LEASE EXPENSE 810,770 740,894
DEFERRED COMPENSATION - 166,474
DEFERRED INTEREST - 25,500
Total liabilities 14,962,472 22,118,326
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 - 4,090,138 at
May 31, 2005 and 3,774,346 shares at
August 31, 2004 17,472,591 16,426,378
Retained deficit (12,314,780) (10,646,487)
Total stockholders' equity 4,816,756 5,779,891
Total liabilities and stockholders' equity $19,779,228 $27,898,217
RIVIERA TOOL COMPANY
STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Three Months For The Nine Months
Ended Ended
May 31, May 31, May 31, May 31,
2005 2004 2005 2004
SALES $4,687,278 $7,596,931 $14,220,838 $24,200,591
COST OF SALES 4,106,830 6,729,645 12,297,177 21,642,926
GROSS PROFIT 580,448 867,286 1,923,661 2,557,665
SELLING, GENERAL AND
ADMINISTRATIVE
EXPENSES 660,103 479,920 2,106,934 1,389,060
INCOME FROM
OPERATIONS (79,655) 387,366 (183,273) 1,168,605
INTEREST EXPENSE 391,737 148,782 1,139,822 480,008
SUBORDINATED DEBT
FINANCING COSTS 304,424 - 345,198 -
TOTAL INTEREST
AND OTHER
EXPENSE 696,161 148,782 1,485,020 480,008
(LOSS)/INCOME BEFORE
INCOME TAXES (775,816) 238,584 (1,688,293) 688,597
INCOME TAXES - - - -
NET (LOSS)/INCOME
AVAILABLE FOR
COMMON SHARES $(755,816) $238,584 $(1,688,293) $688,597
BASIC AND DILUTED
(LOSS)/INCOME PER
COMMON SHARE $(.20) $.06 $(.44) $.18
BASIC AND DILUTED
COMMON SHARES
OUTSTANDING 3,807,527 3,774,346 3,785,569 3,774,346
RIVIERA TOOL COMPANY
STATEMENT OF CASH FLOWS
(UNAUDITED)
For the Three Months For the Nine Months
Ended Ended
May 31, May 31, May 31, May 31,
2005 2004 2005 2004
CASH FLOWS FROM
OPERATING ACTIVITIES
Net (loss)/income $(1,818,871) $238,584 $(2,711,348) $688,597
Adjustments to
reconcile net
(loss)/income to net
cash from operating
activities:
Depreciation and
amortization 427,701 421,599 1,283,103 1,264,798
(Increase) decrease
in assets:
Accounts
receivable 311,319 (7,171,218) 10,458,316 (5,051,668)
Costs in excess
of billings on
contracts in
process (833,342) 3,124,750 (2,736,016) 3,843,404
Perishable
tooling 23,614 (35,697) (7,426) (41,071)
Debt issuance
costs (579,491) - (579,491) -
Prepaid expenses
and other current
assets 337,272 49,741 298,787 (163,822)
Increase (decrease)
in liabilities:
Accounts payable (617,115) 853,652 (1,040,451) 314,709
Accrued outsourced
contracts
payable - (3,557,595) - (2,913,209)
Accrued lease
expense 23,292 25,050 69,876 75,150
Accrued
liabilities 67 54,602 326,353 373,288
Deferred
compensation - - (166,474) -
Net cash provided by/
(used in) operating
activities $(1,682,499) $(5,996,532) $6,238,284 $(1,609,824)
CASH FLOWS FROM
INVESTING ACTIVITIES
(Increase)/decrease
in other assets (55,163) - 24,291 (22,462)
Additions to property,
plant and equipment (7,074) (529,610) (254,163) (820,833)
Net cash used in
investing activities $(62,237) $(529,610) $(229,872) $(843,295)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from issuance
of convertible term
debt 3,200,000 - 3,200,000 -
Proceeds from issuance
of convertible
revolving note 4,031,127 - 4,031,127 -
Proceeds from
overformula note 2,000,000 - 2,000,000 -
Repayments of bank
revolving credit
line (2,595,878) - (9,849,532) -
Repayment of bank
term debt (1,589,777) - (1,835,100) -
Repayment of
subordinated debt (3,000,000) - (3,000,000) -
Increase/(decrease)
of capital lease (1,984) 14,449 (5,853) 14,449
Deferred interest (141,500) - (141,500) -
Net borrowings
(repayments) on
revolving credit
line - 5,354,637 - 1,565,460
Principal payments
on notes payables - (153,776) (42,300) (436,422)
Issuance of stock
option and warrant
exercise 1,043,055 - 1,043,055 -
Sale of common stock 3,158 1,310,912 3,158 1,310,912
Net cash provided by/
(used in) financing
activities $1,905146 6,526,222 $(5,640,000) $2,454,399
NET INCREASE/(DECREASE)
IN CASH $160,410 $80 $368,412 $1,280
CASH - Beginning of
Period 209,202 1,200 1,200 -
CASH - End of Period $369,612 $1,280 $369,612 $1,280
DATASOURCE: Riviera Tool Co.
CONTACT: Kenneth K. Rieth, CEO, or Peter Canepa, CFO, of Riviera Tool
Company, +1-616-698-2100; or Investor inquiries: Jeff Lambert,
+1-616-233-0500, for Riviera Tool Company
Web site: http://www.rivieratool.com/