TIMCO Aviation Services, Inc. Announces Third Quarter 2004 Results

TIMCO Aviation Services, Inc. Announces Third Quarter 2004
Results 


GREENSBORO, N.C., Nov. 15  /PRNewswire-FirstCall/ -- TIMCO Aviation Services,
Inc. (OTC:TMAS) (BULLETIN BOARD: TMAS)  today announced its results of
operations for the 2004 third quarter.

Revenue for the three months ended September 30, 2004 was $74.2 million,
compared to $64.3 million for the third quarter of 2003.  Net income from
continuing operations for the 2004 third quarter was $168,000 compared to
$128,000 for the comparable 2003 period.  Net income from continuing operations
for the third quarter of 2003 benefited from the elimination and reduction in
accruals of $0.9 million based on settlements and revised estimates and from
the collection of a $0.9 million account receivable that had previously been
written off as uncollectible.  Without these benefits, the net loss from
continuing operations for the 2003 third quarter would have been $1.7 million. 
After accounting for income from discontinued operations, net income for the
third quarter of 2004 was $261,000 ($0.01 per basic and $0.00 per diluted
share), compared to net income of $345,000 ($0.01 per basic share and $0.00 per
diluted share) for the 2003 third quarter.

Revenue for the nine months ended September 30, 2004 was $235.7 million,
compared to $167.7 million for the same period in 2003, a 41% increase.  The
net loss from continuing operations was $1.1 million for the first nine months
of 2004, compared to a net loss of $2.8 million for the comparable 2003 period.
 Net loss from continuing operations for the first nine months of 2004
benefited from a gain on the settlement of a warrant obligation of $0.2
million.  Net loss from continuing operations for the first nine months of 2003
benefited from the elimination and reduction of accruals aggregating $2.1
million, collection of a $0.9 million account receivable that had previously
been written off as uncollectible and from a tax benefit of $0.9 million.
Without these benefits, the net loss from continuing operations for the first
nine months of 2004 and 2003 would have been $1.3 million and $6.7 million,
respectively.  After accounting for income from discontinued operations, net
income for the first nine months of 2004 was $130,000 ($0.00 per basic share
and diluted share), compared to a net income of $638,000 ($0.02 per basic and
diluted share) for the comparable 2003 period.

Roy T. Rimmer, Jr., the Company's Chairman and Chief Executive Officer, stated:
"We have experienced significant incremental growth during 2004, which we
believe is the result of our customers looking to us for a larger portion of
their MR&O needs. We intend to focus our efforts during the rest of 2004 and
into 2005 on increasing our revenues in each of our businesses, controlling our
costs, and improving our profitability."

Gil West, the Company's President and Chief Operating Officer, stated: "We are
encouraged by the trend among airlines to increase the amount of their
outsourced airframe maintenance and we expect this trend will continue in the
future.  We are also experiencing strong growth in our engineering and interior
related businesses, and we are taking steps to expand our engine business.  Our
ability to handle significant growth in each of our businesses while
maintaining our margins is a testimony to our first class operations and our
attention to the basics."

TIMCO Aviation Services, Inc. is among the world's largest providers of fully
integrated aviation maintenance, repair and overhaul (MR&O) services for major
commercial airlines, regional air carriers, aircraft leasing companies,
government and military units and air cargo carriers.  The Company currently
operates four MR&O businesses: TIMCO, which, with its four active locations
(Greensboro, NC, Macon, GA, Lake City, FL and Goodyear, AZ), is one of the
largest independent providers of heavy aircraft maintenance services in the
world; Aircraft Interior Design and Brice Manufacturing, which specialize in
the refurbishment of aircraft interior components and the manufacture and sale
of aftermarket parts and new aircraft seats; TIMCO Engineered Systems, which
provides engineering services both to our other MR&O operations and to our
customers; and TIMCO Engine Center, which refurbishes JT8D engines and performs
on-wing repairs for both JT8D and CFM-56 series engine. Visit TIMCO online at
http://www.timco.aero/ .

This press release contains certain forward-looking statements. Forward-
looking statements involve known and unknown risks and uncertainties, which may
cause the Company's actual results in future periods to differ materially from
forecasted results. A number of factors, including those identified in the
Company's Annual Report on Form 10-K for the year ended December 31, 2003, its
Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, and
those identified below, could adversely affect the Company's ability to obtain
these results: the Company's ability to continue to generate sufficient working
capital from operations to meet its operating requirements and service its
indebtedness, the Company maintaining good working relationships with its
vendors and customers, competitive pricing for the Company's products and
services, the Company's ability to achieve gross margins at which it can be
profitable, including margins on services the Company performs on a fixed price
basis, competition in the aircraft maintenance, repair and overhaul market, the
Company's ability to attract and retain qualified personnel in its business,
utilization rates for the Company's MR&O facilities, the Company's ability to
integrate future acquisitions, the Company's ability to effectively manage its
business, economic factors which affect the airline industry generally and
thereby affect our business (since our customer base consists primarily of
airlines and freight carriers), including the amount of aircraft maintenance
being outsourced, the price of jet fuel and the ongoing war on terrorism, and
changes in government regulations. Copies of the Company's filings with the
U.S. Securities and Exchange Commission are available from the SEC or may be
obtained upon request from the Company. The Company does not undertake any
obligation to update the information contained herein, which speaks only as of
this date.

                      TIMCO Aviation Services, Inc.
                   ($ thousands, except per share data)

                             Three months ended        Nine months ended
                                 Sept. 30,                  Sept. 30,
                              2004       2003          2004          2003

  Operating revenue         $74,152    $64,309      $235,654      $167,706
  Gross Profit        (a)     7,122      5,426        20,221        10,520
  Gross Profit
   Percentage         (a)       9.6 %      8.4 %         8.6 %         6.3 %
  Operating expenses  (b)     5,206      3,125        16,113         9,797
  Operating expenses
   as a % of revenue  (b)       7.0 %      4.9 %         6.8 %         5.8 %
  Income from
   operations         (c)     1,916      2,301         4,108           723
  Income (loss) from
   continuing
   operations         (d)       168        128        (1,077)       (2,755)
  Income, net, from
   discontinued
   operations         (e)        93        217         1,207         3,393
  Net income                   $261       $345          $130          $638
  Basic income                $0.01      $0.01         $0.00         $0.02
   per share
  Diluted income
   per share                  $0.00      $0.00         $0.00         $0.02

  The Company is providing the following information to allow what the
  Company believes to be a meaningful comparison of its period to period
  results.

  (a) 2003 third quarter and nine month gross profit benefited from the
      elimination of accruals aggregating $463.  Without this impact, gross
      profit for the 2003 third quarter and first nine months would have
      been $4,963 (7.7% of revenues) and $10,057 (6.0% of revenues),
      respectively.
  (b) 2003 third quarter and nine month operating expenses benefited from
      the elimination of accruals and recovery of an account receivable that
      had previously been written off as uncollectible aggregating $1,325
      and $2,589, respectively.  Without the impact of these items,
      operating expenses for the 2003 third quarter and first nine months
      would have been $4,450 (6.9% of revenues) and $12,386 (7.4% of
      revenues), respectively.
  (c) The income (loss) from operations for the third quarter and first nine
      months of 2003 without the impact of the items noted in (a) and (b)
      above would have been $513 and ($2,329), respectively.
  (d) Income from continuing operations for the nine months ended September
      30, 2004 included a gain on the settlement of a warrant obligation of
      $209.  Income from continuing operations in the first nine months of
      2003 included an income tax benefit of $884.  Without the benefit of
      these items and of the items described in (a) and (b) above, the net
      income (loss) from continuing operations for the third quarter of 2004
      and 2003 would have been $168 and ($1,660), respectively, and the net
      loss from continuing operations for the first nine months of 2004 and
      2003 would have been ($1,286) and ($6,691), respectively.
  (e) Income, net, from discontinued operations reflects the gain on the
      collection of receivables and the sale of inventory from discontinued
      operations. The Company's manufacturing, redistribution and new parts
      operations were sold in fiscal 2000 and the process of collection on
      the assets from these discontinued operations is winding down. As a
      result, income from discontinued operations is not expected to be
      significant in future periods.  Income, net from discontinued
      operations included a benefit of $825 in the nine months ended
      September 30, 2004 from the sale of our Miramar facility and a benefit
      of $2,700 in the nine-month period ended September 30, 2003 from the
      elimination and settlement of contingency exposures and reserves
      relating to discontinued operations.


DATASOURCE: TIMCO Aviation Services, Inc.



CONTACT:  Roy T. Rimmer, Jr., Chairman & Chief Executive Officer, or

Fritz Baumgartner, Vice President, Controller and Chief Accounting Officer, of

TIMCO Aviation Services, Inc., [phone]



Web site:  http://www.timco.aero/ 

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