Limco-Piedmont Inc. Reports Results for the Three and Twelve Months Ended December 31, 2008

TULSA, Okla., March 8  /PRNewswire-FirstCall/ -- Limco-Piedmont Inc. (NASDAQ:LIMC) today announced that revenues for the three months ended December 31, 2008 were $17.9 million, an increase of $3.0 million from $14.9 million for that same period last year.  This increase is reflective of our continued growth in our MRO business segment.  Revenues for the twelve months ended December 31, 2008 were $71.6 million, an increase of $1.8 million from $69.8 million for the same period last year.  This increase in sales revenues is a result of the growth in our MRO revenues during the twelve months ended December 31, 2008.

Revenues from our two segments for the three and twelve-month periods ended December 31, 2008 and 2007 were as follows:

                      Three Months Ended           Twelve Months Ended
                         December 31,                  December 31,
                      2008          2007            2008          2007
                         % of           % of            % of          % of
                        Total           Total           Total         Total
                 Reve-  Reve-   Reve-   Reve-   Reve-   Reve-  Reve-  Reve-
                 nues   nues    nues    nues    nues    nues   nues   nues
                                (Revenues in thousands)
  Revenues:
  MRO
   Services     $14,012  78.1% $11,515  77.4% $54,276  75.8% $49,392  70.8%
  Parts
   services       3,929  21.9%   3,362  22.6%  17,289  24.2%  20,384  29.2%
    Total
     revenues   $17,941 100.0% $14,877 100.0% $71,565 100.0% $69,776 100.0%


Our operating income decreased by $373,000 to $465,000 for the three months ended December 31, 2008 from $838,000 for the three months ended December 31, 2007.  Our operating income decreased by $4.1 million, to $3.8 million for the twelve months ended December 31, 2008 from $7.9 million for the twelve months ended December 31, 2007.

General and administrative expenses increased by $79,000 to $1.7 million for the three months ended December 31, 2008 from $1.6 million for the three months ended December 31, 2007. The increase in general and administrative expenses is primarily attributable to audit expenses and some merger and acquisition expenses. Non-cash compensation expense was ($27,000) and included in general and administrative expenses during the fourth quarter of 2008 compared to $220,000 in the fourth quarter of 2007.

General and administrative expenses increased by $137,000 to $7.1 million for the year ended December 31, 2008 from $7.0 million for the year ended December 31, 2007. The increase in general and administrative expenses is primarily attributable to approximately $837,000 in one-time SOX and public company costs, $110,000 in severance pay, $60,000 in tax audit expenses, and acquisition expenses of $357,000.  These expenses were offset by the lack of phantom stock expense of $325,000, IPO bonus expense of $400,000 and increased public company costs and administrative costs during the year ended December 31, 2007.  Non-cash compensation expense was $175,000 and included in general and administrative expenses during the year ended December 31, of 2008 compared to $390,000 in the during the year ended December 31, 2007.

Net income for the three month period ended December 31, 2008 was $148,000, or $0.01 per basic and diluted share compared with $789,000 or $0.06 per basic and diluted share in the period ended December 31, 2007.

Net income for the twelve month period ended December 31, 2008 was $2.7 million, or $0.21 per basic and diluted share compared with $5.2 million or $0.48 per basic or $0.47 per diluted share in the period ended December 31, 2007.

We ended the quarter with $21.3 million in cash and cash equivalents and $11.3 million in short-term investments.

Bob Koch and Udi Netivi our Co-Chief Executive Officers, commented: "Despite weakness in the airline segment and the general economy, the fourth quarter of 2008 saw continued revenue growth in our core MRO businesses and parts business versus the fourth quarter of last year.  The revenue mix at our LIMCO Airepair subsidiary drove higher production costs and depressed gross margins.  We expect these mix issues to correct favorably in 2009.  Additionally, the expense reduction measures we took in the fourth quarter are taking effect."

At Piedmont, our propeller and landing gear products are growing and offsetting revenue pressure we are seeing in the APU and parts segments.  However, we received two new APU contracts with European Airlines, each for a period of five years.

At LIMCO, sales for the fourth quarter were up from the fourth quarter of 2007 but slightly off of the third quarter of 2008. Solid OEM and Military bookings for 2009 and beyond continued in the fourth quarter and airline receipts stabilized.  The lean production and cost control measures we have implemented are taking effect and will drive improved 2009 performance. The consolidation in North Carolina will also drive continued performance improvements of the LIMCO products lines.

Dr. Shmuel Fledel, our Chairman of the Board, concluded by saying, "Despite challenging economic conditions, we expect revenue growth in 2009. The expense control measures we have taken and consolidation of the two operating entities in one location will contribute to improved earnings going forward.  We are looking positively towards 2009."

About Limco - Piedmont Inc.

Limco-Piedmont Inc. provides maintenance, repair and overhaul, or MRO, services and parts supply services to the aerospace industry.  Limco-Piedmont's four Federal Aviation Administration certified repair stations provide aircraft component MRO services for airlines, air cargo carriers, maintenance service centers and the military.  Limco-Piedmont specializes in MRO services for components of aircraft, such as heat transfer components, auxiliary power units, propellers, landing gear and pneumatic ducting.  In conjunction with Limco-Piedmont's MRO services, Limco-Piedmont is also an original equipment manufacturer of heat transfer equipment for airplane manufacturers and other related products. Limco-Piedmont's parts services division offers inventory management and parts services for commercial, regional and charter airlines and business aircraft owners

Safe Harbor for Forward-Looking Statements

This press release contains forward-looking statements that are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, general business conditions in the airline industry, changes in demand for our services and products, the timing and amount or cancellation of orders, the price and continuity of supply of component parts used in our operations,  and other risks detailed from time to time in Limco-Piedmont's filings with the Securities Exchange Commission, including its Annual Report on Form 10-K. These documents contain and identify other important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. Stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update publicly or revise any forward-looking statement.

                            - Tables Follow -

                     LIMCO-PIEDMONT INC. AND SUBSIDIARIES

               UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
                    (in thousands, except per share data)

                                                December 31,    December 31,
                                                    2008            2007
                         ASSETS
  Current Assets:
   Cash and cash equivalents                      $21,336          $5,039
   Marketable Securities                           11,300          28,806

   Accounts receivable (net of allowance
    for doubtful accounts of $79 and $140
    at December 31, 2008 and, respectively)        11,820           9,328
   Inventories                                     18,978          16,391
   Other accounts receivable and prepaid
    expenses                                        1,326           1,481

     Total current assets                          64,760          61,045

  Property, plant and equipment, net                6,023           5,169
  Intangible assets, net                            1,383           1,709
  Goodwill                                          4,780           4,780
     Total assets                                 $76,946         $72,703

              LIABILITIES AND SHAREHOLDERS' EQUITY

  Current Liabilities:
   Accounts payables                               $5,378          $5,084
   Parent company payables                          2,341           1,762
   Other accounts payable and accrued expenses      1,764           1,568
     Total current liabilities                      9,483           8,414

  Long-Term Liabilities:
   Deferred income tax liabilities                    835             404

     Total liabilities                             10,318           8,818
  Commitments and contingencies
  Shareholders' Equity:
   Common stock, $0.01 par value; 25,000 shares
    authorized, 13,205 shares issued and outstanding
    at both December 31, 2008 and 2007                132             132
   Additional paid-in capital                      49,179          49,004
   Retained earnings                               17,462          14,749
   Accumulated other comprehensive loss              (145)            ---
     Total shareholders' equity                    66,628          63,885
     Total liabilities and shareholders' equity   $76,946         $72,703

                     LIMCO-PIEDMONT INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                    (in thousands, except per share data)

                                  Three months ended    Twelve months ended
                                      December 31,          December 31,
                                     2008       2007      2008       2007

  Revenue
   MRO services                    $14,012    $11,515   $54,276    $49,392
   Parts services                    3,929      3,362    17,289     20,384

     Total revenue                  17,941     14,877    71,565     69,776

  Cost and operating expenses
   MRO services                     11,787      8,986    43,664     35,205
   Parts services                    3,352      2,706    13,922     16,603
   Selling and marketing               614        638     2,755      2,613
   General and administrative        1,669      1,590     7,118      6,981
   Amortization of intangibles          54        119       326        474

     Operating income                  465        838     3,780      7,900

  Other income (expense)
   Interest income                     342        355     1,259        897
   Interest and other expense         (326)       (13)     (403)      (732)

     Total other income (expense)       16        342       856        165

  Income before taxes                  481      1,180     4,636      8,065
  Provision for income taxes           333        391     1,923      2,871

  Net income                          $148       $789    $2,713     $5,194

  Basic net income per share         $0.01      $0.06     $0.21      $0.48
  Diluted net income per share       $0.01      $0.06     $0.21      $0.47

  Basic shares outstanding          13,205     12,406    13,205     10,934
  Diluted shares outstanding        13,205     12,437    13,205     10,962


DATASOURCE: Limco-Piedmont Inc.



CONTACT:  Bob Koch, Co-Chief Executive Officer of Limco-Piedmont Inc.,

[phone]



Web Site:  http://www.limcoairepair.com/ 

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