Pemco Aviation Group Reports Profit in the Second Quarter and First Six Months of 2007

  
    
  
  
    
      Pemco Aviation Group, Inc. (NASDAQ: PAGI), a leading provider of 
      aircraft maintenance and modification services, today announced the 
      operating results of its second quarter and six months ended June 30, 
      2007. Net income for the second quarter of 2007 was $0.63 million ($0.15 
      per share) compared to net income for the second quarter of 2006 of 
      $0.45 million ($0.11 per share), an improvement of 40%. Revenue for the 
      second quarter of 2007 was $53.2 million versus revenue of $48.5 million 
      in the second quarter of 2006, an increase of 10%. Net income for the 
      first six months of 2007 was $1.52 million ($0.37 per share) compared 
      with net income of $0.52 million ($0.13 per share) in the first six 
      months of 2006. Revenue for the six months ended June 30, 2007 was 
      $105.6 million, compared to $85.1 million in the six months ended June 
      30, 2006, an increase of 24%. The Company’s 
      results of operations in the first six months of 2006 was impacted by a 
      $0.36 million positive adjustment in a warranty reserve due to 
      additional regulatory approvals issued during the second quarter of 2006 
      and the reversal of $0.64 million of a $1.50 million provision for 
      accounts receivable.
    
    
      Ronald Aramini, Pemco’s President and CEO, 
      stated “Pemco’s 
      second quarter and six month results reflect continued growth in revenue 
      and net income for Pemco. Significant progress has also been made in the 
      divestiture of our Commercial Services Segment (“CSS”). 
      As previously announced, we signed a contract on July 10, 2007 to sell 
      our Pemco World Air Services subsidiary to an affiliate of Sun Capital 
      Partners, Inc. We expect the proceeds to be sufficient to eliminate all 
      of our bank debt and provide working capital for our Government Services 
      Segment (“GSS”). We 
      have continued to deliver KC-135 aircraft in reduced flow days and high 
      quality despite a decrease in inductions during the first six months of 
      2007. We anticipate the award of the new KC-135 contract will be made in 
      the next few weeks and we remain very optimistic about winning.”
    
    
      Second Quarter 2007 vs. 2006 Results
    
    
      
        
          
            Summary of comparative results for the second quarter ended
          
          
            June 30, 2007:
          
        
      
      
        
          
            (Dollars in Millions)
          
        
      
      
        
          
             
          
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
           
        
        
          2007
        
        
        
        
           
        
        
          2006
        
        
        
        
          Change
        
      
      
        
          Revenue
        
        
        
        
          $
        
        
          53.18
        
        
        
        
          $
        
        
          48.48
        
        
        
        
          9.7%
        
      
      
        
          Gross profit
        
        
        
        
        
        
          7.28
        
        
        
        
        
        
          6.72
        
        
        
        
          8.3%
        
      
      
        
          Operating income from continuing operations
        
        
        
        
        
        
          2.11
        
        
        
        
        
        
          1.93
        
        
        
        
          9.3%
        
      
      
        
          Income from continuing operations before taxes
        
        
        
        
        
        
          1.05
        
        
        
        
        
        
          1.10
        
        
        
        
          (4.5%)
        
      
      
        
          Income from continuing operations
        
        
        
        
        
        
          0.63
        
        
        
        
        
        
          0.66
        
        
        
        
          (4.5%)
        
      
      
        
          Net income
        
        
        
        
        
        
          0.63
        
        
        
        
        
        
          0.45
        
        
        
        
          40.0%
        
      
      
        
          
            EBITDA(a) from continuing operations
          
        
        
        
        
        
        
          2.97
        
        
        
        
        
        
          2.85
        
        
        
        
          4.2%
        
      
    
    
      (a) A description of the Company’s use of 
      non-GAAP information is provided below under “Use 
      of Non-GAAP Financial Measures.” A 
      reconciliation of net income to EBITDA is provided at the end of this 
      press release.
    
    
      GSS revenue decreased $8.9 million in the second quarter of 2007, 
      primarily due to decreases in KC-135 deliveries offset by increased 
      revenue from U.S. Navy P-3 aircraft and U.S Air Force (“USAF”) 
      C-130 aircraft. The KC-135 Program Depot Maintenance (“PDM”) 
      program, which accounted for 22.5% of revenue in the second quarter of 
      2007 and 44.7% of revenue in the second quarter of 2006, allows for the 
      Company to provide services on PDM aircraft, drop-in aircraft, and other 
      aircraft related areas. Revenue from the KC-135 program decreased $9.7 
      million during the second quarter of 2007 versus the second quarter of 
      2006. During the second quarter of 2007, the Company delivered three PDM 
      aircraft and no drop-ins, compared to six PDM aircraft and one drop-in 
      during the second quarter of 2006. The Company delivered one P-3 
      aircraft in the second quarter of 2007 and 2006. Revenue from 
      non-routine work performed on P-3 aircraft increased $0.3 million during 
      the second quarter of 2007 compared to the second quarter of 2006 due to 
      more aircraft in work. Revenue increased $1.0 million under contracts to 
      perform non-routine maintenance work on USAF C-130 aircraft. Revenue on 
      other U.S. Government programs decreased $0.5 million during the second 
      quarter of 2007 compared to the second quarter of 2006.
    
    
      CSS revenue increased $13.1 million in the second quarter of 2007, 
      primarily due to increases in cargo conversion revenues of $7.0 million, 
      increases in maintenance, repair and overhaul (“MRO”) 
      revenue from Southwest Airlines of $4.7 million, and increases in MRO 
      revenue from Northwest Airlines of $3.5 million, offset by decreases in 
      revenue from various customers of $1.3 million and settlement of the H-3 
      Request for Equitable Adjustment of $0.8 million in the first quarter of 
      2006. CSS delivered four cargo conversions during the second quarter of 
      2007 compared to two during the second quarter of 2006. Two of the four 
      cargo conversions were performed in mainland China. Southwest Airlines 
      increased the number of aircraft inducted during the second quarter of 
      2007 versus the second quarter of 2006. Northwest Airlines increased the 
      scope of work on aircraft inducted in the second quarter of 2007 as 
      compared to the second quarter of 2006. CSS has several customers that 
      provide drop-in aircraft on an inconsistent basis. These drop-in 
      aircraft accounted for a larger percentage of revenue in the second 
      quarter of 2006.
    
    
      Gross profit at GSS decreased to $0.6 million during the second quarter 
      of 2007 compared to $2.3 million during the second quarter of 2006. The 
      decrease is primarily attributable to a decline in deliveries of KC-135 
      aircraft and losses incurred on the U.S. Navy P-3 program. Gross profit 
      on the KC-135 program decreased $0.6 million during the second quarter 
      of 2007 versus the second quarter of 2006. The Company recorded losses 
      on the U.S. Navy P-3 program of $1.1 million during the second quarter 
      of 2007 versus losses of $0.5 million during the second quarter of 2006. 
      Selling, general and administrative (“SG&A”) 
      expenses decreased $0.6 million during the second quarter of 2007 versus 
      the second quarter of 2006 due to a decrease in the amount of allocated 
      corporate expenses.
    
    
      Gross profit at CSS increased from $3.1 million during the second 
      quarter of 2006 to $6.1 million during the second quarter of 2007. 
      Additional MRO revenue increased gross profit by $1.8 million in the 
      second quarter of 2007. Additional cargo conversions increased gross 
      profit by $1.8 million in the second quarter of 2007. Gross profit at 
      CSS in 2006 was positively impacted by the settlement of the H-3 Request 
      for Equitable Adjustment, which resulted in an increase in revenue of 
      $0.8 million. CSS SG&A expenses decreased $0.2 million to $2.1 million 
      in the second quarter of 2007 from $2.3 million in the second quarter of 
      2006 due to a reduction of allocated corporate expenses. CSS also 
      recognized a $0.6 million reversal of a provision for doubtful accounts 
      in the second quarter of 2006.
    
    
      During the second quarter of 2007, the Company incurred $0.5 million of 
      legal and accounting expenses related to the planned sale of Space 
      Vector Corporation and the sale of CSS. The Company did not allocate 
      these expenses to its subsidiaries. There were no comparable unallocated 
      corporate expenses in the second quarter of 2006.
    
    
      Total interest expense, including discontinued operations, increased to 
      $1.1 million in the second quarter of 2007 from $0.9 million in the 
      second quarter of 2006. Interest expense increased primarily as a result 
      of higher rates on variable interest rate loans resulting from amending 
      existing credit agreements.
    
    
      Six Months 2007 vs. 2006 Results
    
    
      
        
          
            Summary of comparative results for the six months ended June 30, 
            2007:
          
        
      
      
        
          
            (Dollars in Millions)
          
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
           
        
        
          2007
        
        
        
        
           
        
        
          2006
        
        
        
        
          Change
        
      
      
        
          Revenue
        
        
        
        
          $
        
        
          105.58
        
        
        
        
          $
        
        
          85.14
        
        
        
        
          24.0%
        
      
      
        
          Gross profit
        
        
        
        
        
        
          15.54
        
        
        
        
        
        
          13.15
        
        
        
        
          18.2%
        
      
      
        
          Operating income from continuing operations
        
        
        
        
        
        
          4.73
        
        
        
        
        
        
          2.77
        
        
        
        
          70.8%
        
      
      
        
          Income from continuing operations before taxes
        
        
        
        
        
        
          2.68
        
        
        
        
        
        
          1.31
        
        
        
        
          104.6%
        
      
      
        
          Income from continuing operations
        
        
        
        
        
        
          1.52
        
        
        
        
        
        
          0.80
        
        
        
        
          90.0%
        
      
      
        
          Net income
        
        
        
        
        
        
          1.52
        
        
        
        
        
        
          0.52
        
        
        
        
          192.3%
        
      
      
        
          
            EBITDA(a) from continuing operations
          
        
        
        
        
        
        
          6.41
        
        
        
        
        
        
          4.58
        
        
        
        
          40.0%
        
      
    
    
      (a) A description of the Company’s use of 
      non-GAAP information is provided below under “Use 
      of Non-GAAP Financial Measures.” A 
      reconciliation of net income to EBITDA is provided at the end of this 
      press release.
    
    
      The $11.3 million decrease in GSS revenue was primarily due to decreases 
      in KC-135 and U.S. Coast Guard (“USCG”) 
      C-130 deliveries offset by increased revenue from U.S. Navy P-3 aircraft 
      and USAF C-130 aircraft. The KC-135 PDM program accounted for 25.4% of 
      revenue in the first six months of 2007 and 47.1% of revenue in the 
      first six months of 2006 Revenue from the KC-135 program decreased $13.3 
      million during the first six months of 2007 versus the first six months 
      of 2006. During the first six months of 2007, the Company delivered 
      seven PDM aircraft and no drop-ins, compared to ten PDM aircraft and two 
      drop-ins during first six months of 2006. The Company delivered two USCG 
      C-130 aircraft during the first six months of 2006 for which there was 
      no comparable revenue in 2007, resulting in a decrease in revenue of 
      $3.5 million. The Company delivered three P-3 aircraft in the first six 
      months of 2007 versus one in the first six months of 2006, which 
      increased revenue by $1.1 million. Revenue from non-routine work 
      performed on P-3 aircraft increased by $1.1 million during the first six 
      months of 2007 compared to the first six months of 2006 due to more 
      aircraft in work. Revenue increased by $2.1 million during the first six 
      months of 2007 under contracts to perform non-routine maintenance work 
      on USAF C-130 aircraft. Revenue on other U.S. Government programs 
      increased $0.9 million during the first six months of 2007 compared to 
      the first six months of 2006.
    
    
      The increase in CSS revenue of $32.3 million was primarily due to 
      increases in cargo conversion revenues of $17.1 million, increases in 
      MRO revenue from Southwest Airlines of $11.5 million, and increases in 
      MRO revenue from Northwest Airlines of $8.9 million, offset by decreases 
      in revenue from various customers of $4.4 million and settlement of the 
      H-3 Request for Equitable Adjustment of $0.8 million in the first 
      quarter of 2006. CSS delivered seven cargo conversions during the first 
      six months of 2007 compared to two during the first six months of 2006. 
      Three of the seven cargo conversions were performed in mainland China. 
      Southwest Airlines increased the number of aircraft inducted during the 
      first six months of 2007 versus the first six months of 2006. Northwest 
      Airlines increased the scope of work on aircraft inducted in the first 
      six months of 2007 as compared to the first six months of 2006. CSS has 
      several customers that provide drop-in aircraft on an inconsistent 
      basis. These drop-in aircraft accounted for a larger percentage of 
      revenue in the first six months of 2006.
    
    
      Gross profit at GSS decreased from $5.3 million to $3.3 million during 
      the first six months of 2007 compared to the first six months of 2006. 
      The decrease is primarily attributable to higher overhead rates caused 
      by a reduction in man-hours and losses incurred on the U.S. Navy P-3 
      program. Gross profit on the KC-135 program decreased $0.6 million 
      during the first six months of 2007 versus the first six months of 2006. 
      The Company recorded losses on the U.S. Navy P-3 program of $1.1 million 
      during the first six months of 2007 versus losses of $0.4 million during 
      the first six months of 2006. GSS SG&A expenses decreased by $0.9 
      million to $3.7 million in the first six months of 2007 from $4.6 
      million in the first six months of 2006 due to a reduction in allocated 
      corporate expenses.
    
    
      Gross profit at CSS increased from $5.9 million during the first six 
      months of 2006 to $11.3 million during the first six months of 2007. 
      Gross profit during the first half of 2006 was adversely impacted by the 
      lockout of union employees at the Dothan, Alabama facility, from 
      August 11, 2005 to October 9, 2005 and the bankruptcy of Northwest 
      Airlines in the third quarter of 2005 as CSS capacity utilization 
      increased back to normal levels. Additional MRO revenue increased gross 
      profit by $3.7 million in the first six months of 2007. Additional cargo 
      conversions increased gross profit by $2.5 million in the first six 
      months of 2007. Gross profit at CSS in 2006 was also positively affected 
      by the settlement of the H-3 Request for Equitable Adjustment which 
      resulted in an increase in revenue of $0.8 million. CSS SG&A expenses 
      remained unchanged at $4.9 million in the first six months of 2007 and 
      2006. CSS also recognized a $0.6 million reversal of a provision for 
      doubtful accounts in the first six months of 2006.
    
    
      During the first six months of 2007, the Company incurred $0.9 million 
      of legal and accounting expenses related to the planned sale of Space 
      Vector Corporation and the sale of CSS. The Company did not allocate 
      these expenses to its subsidiaries. There were no comparable unallocated 
      corporate expenses in the first six months of 2006.
    
    
      Total interest expense increased to $2.1 million in the first six months 
      of 2007 from $1.5 million in the first six months of 2006. Interest 
      expense increased primarily as a result of higher rates on variable 
      interest rate loans resulting from amending existing credit agreements.
    
    
      (a) Use of Non-GAAP Financial Measures
    
    
      EBITDA is defined as earnings before interest, taxes, depreciation and 
      amortization. Pemco presents EBITDA because its management uses the 
      measure to evaluate the Company's performance and to allocate resources. 
      In addition, EBITDA has been used as one of the components to calculate 
      the Company’s debt covenants. Pemco believes 
      EBITDA is a also measure of performance used by some commercial banks, 
      investment banks, investors, analysts and others to make informed 
      investment decisions. EBITDA is an indicator of cash generated to 
      service debt and fund capital expenditures. EBITDA is not a measure of 
      financial performance under generally accepted accounting principles and 
      should not be considered as a substitute for or superior to other 
      measures of financial performance reported in accordance with GAAP. 
      EBITDA as presented herein may not be comparable to similarly titled 
      measures reported by other companies. See the reconciliation of net 
      income to EBITDA at the end of this release.
    
    
      About Pemco
    
    
      Pemco Aviation Group, Inc., with executive offices in Birmingham, 
      Alabama, and facilities in Alabama and California, performs maintenance 
      and modification of aircraft for the U.S. Government and for foreign and 
      domestic commercial customers. The Company also provides aircraft parts 
      and support and engineering services, in addition to developing and 
      manufacturing aircraft cargo systems, rocket vehicles and control 
      systems, and precision components. For more information: www.pemcoaviationgroup.com.
    
    
      This press release contains forward-looking statements made in 
      reliance on the safe harbor provisions of Section 27A of the Securities 
      Act of 1933, as amended, and Section 21E of the Securities Exchange Act 
      of 1934, as amended. These statements may be identified by their 
      use of words, such as “believe,” 
      “expect,” “intend,” 
      “anticipate,” “estimate” 
      and other words and terms of similar meaning, in connection with any 
      discussion of the Company's prospects, financial statements, business, 
      financial condition, revenues, results of operations or liquidity. Factors 
      that could affect the Company's forward-looking statements include, 
      among other things: changes in global or domestic economic conditions; 
      the loss of one or more of the Company's major customers; the Company's 
      ability to obtain additional contracts and perform under existing 
      contracts; the outcome of pending and future litigation and the costs of 
      defending such litigation; financial difficulties experienced by the 
      Company's customers; potential environmental and other liabilities; the 
      inability of the Company to obtain additional financing; material 
      weaknesses in the Company’s internal control 
      over financial reporting; regulatory changes that adversely affect the 
      Company's business; loss of key personnel; and other risks detailed from 
      time to time in the Company's SEC reports, including its most recent 
      Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The 
      Company cautions readers not to place undue reliance on any 
      forward-looking statements, which speak only as of the date on which 
      they are made. The Company does not undertake any obligation to 
      update or revise any forward-looking statements and is not responsible 
      for changes made to this release by wire services or Internet services. 
    
    
      
        
          PEMCO AVIATION GROUP, INC.
        
      
      
        
          (In thousands except per share information)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
          Second Quarter Ended
        
      
      
        
        
        
        
        
        
        
          June 30,
        
      
      
        
        
        
        
        
        
        
           
        
        
          2007
        
        
           
        
        
        
        
           
        
        
          2006
        
        
           
        
      
      
        
          Sales:
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          Government Services Segment
        
        
        
        
          $
        
        
          15,784
        
        
        
        
        
        
          $
        
        
          24,639
        
        
        
      
      
        
        
        
          Commercial Services Segment
        
        
        
        
        
        
          33,997
        
        
        
        
        
        
        
        
          20,909
        
        
        
      
      
        
        
        
          Manufacturing and Components Segment
        
        
        
        
        
        
          3,403
        
        
        
        
        
        
        
        
          3,044
        
        
        
      
      
        
        
        
          Inter-segment Revenue
        
        
        
        
           
        
        
          (8
        
        
          )
        
        
        
        
           
        
        
          (112
        
        
          )
        
      
      
        
          Total Sales
        
        
        
        
        
        
          53,176
        
        
        
        
        
        
        
        
          48,480
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Cost of Sales
        
        
        
        
           
        
        
          45,899
        
        
           
        
        
        
        
           
        
        
          41,759
        
        
           
        
      
      
        
        
        
          Gross Profit
        
        
        
        
        
        
          7,277
        
        
        
        
        
        
        
        
          6,721
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Selling, General and Administrative Expenses
        
        
        
        
        
        
          5,169
        
        
        
        
        
        
        
        
          5,433
        
        
        
      
      
        
          Reversal of Provision for Doubtful Accounts
        
        
        
        
           
        
        
          -
        
        
           
        
        
        
        
           
        
        
          (638
        
        
          )
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating Income
        
        
        
        
        
        
          2,108
        
        
        
        
        
        
        
        
          1,926
        
        
        
      
      
        
          Interest Expense
        
        
        
        
           
        
        
          (1,058
        
        
          )
        
        
        
        
           
        
        
          (829
        
        
          )
        
      
      
        
          Income from Continuing Operations Before Taxes
        
        
        
        
        
        
          1,050
        
        
        
        
        
        
        
        
          1,097
        
        
        
      
      
        
          Income Tax Expense
        
        
        
        
           
        
        
          (424
        
        
          )
        
        
        
        
           
        
        
          (434
        
        
          )
        
      
      
        
        
        
          Income from Continuing Operations
        
        
        
        
        
        
          626
        
        
        
        
        
        
        
        
          663
        
        
        
      
      
        
          Loss From Discontinued Operations, net of Tax
        
        
        
        
           
        
        
          -
        
        
           
        
        
        
        
           
        
        
          (218
        
        
          )
        
      
      
        
        
        
          Net Income
        
        
        
        
          $
        
        
          626
        
        
           
        
        
        
        
          $
        
        
          445
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Weighted Average Common Shares Outstanding:
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          Basic
        
        
        
        
           
        
        
          4,126
        
        
           
        
        
        
        
           
        
        
          4,121
        
        
           
        
      
      
        
        
        
          Diluted
        
        
        
        
           
        
        
          4,189
        
        
           
        
        
        
        
           
        
        
          4,252
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net Income Per Common Share:
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          Basic income from continuing operations
        
        
        
        
          $
        
        
          0.15
        
        
           
        
        
        
        
          $
        
        
          0.16
        
        
           
        
      
      
        
        
        
          Basic income (loss) from discontinued operations
        
        
        
        
          $
        
        
          -
        
        
           
        
        
        
        
          $
        
        
          (0.05
        
        
          )
        
      
      
        
        
        
          Basic net income per share
        
        
        
        
          $
        
        
          0.15
        
        
           
        
        
        
        
          $
        
        
          0.11
        
        
           
        
      
      
        
        
        
          Diluted income from continuing operations
        
        
        
        
          $
        
        
          0.15
        
        
           
        
        
        
        
          $
        
        
          0.16
        
        
           
        
      
      
        
        
        
          Diluted income (loss) from discontinued operations
        
        
        
        
          $
        
        
          -
        
        
           
        
        
        
        
          $
        
        
          (0.05
        
        
          )
        
      
      
        
        
        
          Diluted net income per share
        
        
        
        
          $
        
        
          0.15
        
        
           
        
        
        
        
          $
        
        
          0.10
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            EBITDA Reconciliation(a)
          
        
        
        
        
        
        
        
        
        
      
      
        
          Net Income from Continuing Operations
        
        
        
        
          $
        
        
          626
        
        
        
        
        
        
          $
        
        
          663
        
        
        
      
      
        
          Interest Expense
        
        
        
        
        
        
          1,058
        
        
        
        
        
        
        
        
          829
        
        
        
      
      
        
          Income Tax Expense
        
        
        
        
        
        
          424
        
        
        
        
        
        
        
        
          434
        
        
        
      
      
        
          Depreciation and Amortization
        
        
        
        
           
        
        
          861
        
        
           
        
        
        
        
           
        
        
          925
        
        
           
        
      
      
        
          EBITDA from Continuing Operations
        
        
        
        
          $
        
        
          2,969
        
        
           
        
        
        
        
          $
        
        
          2,851
        
        
           
        
      
      
        
          
            (a) See note above on Use of Non-GAAP Financial Measures.
          
        
      
    
    
      
        
          PEMCO AVIATION GROUP, INC.
        
      
      
        
          (In thousands except per share information)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
          Six Months Ended
        
      
      
        
        
        
        
        
        
        
          June 30,
        
      
      
        
        
        
        
        
        
        
           
        
        
          2007
        
        
           
        
        
        
        
           
        
        
          2006
        
        
           
        
      
      
        
          Sales:
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          Government Services Segment
        
        
        
        
          $
        
        
          35,413
        
        
        
        
        
        
          $
        
        
          46,669
        
        
        
      
      
        
        
        
          Commercial Services Segment
        
        
        
        
        
        
          65,224
        
        
        
        
        
        
        
        
          32,963
        
        
        
      
      
        
        
        
          Manufacturing and Components Segment
        
        
        
        
        
        
          4,997
        
        
        
        
        
        
        
        
          5,628
        
        
        
      
      
        
        
        
          Inter-segment Revenue
        
        
        
        
           
        
        
          (54
        
        
          )
        
        
        
        
           
        
        
          (125
        
        
          )
        
      
      
        
          Total Sales
        
        
        
        
        
        
          105,580
        
        
        
        
        
        
        
        
          85,135
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Cost of Sales
        
        
        
        
           
        
        
          90,038
        
        
           
        
        
        
        
           
        
        
          71,987
        
        
           
        
      
      
        
        
        
          Gross Profit
        
        
        
        
        
        
          15,542
        
        
        
        
        
        
        
        
          13,148
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Selling, General and Administrative Expenses
        
        
        
        
        
        
          10,808
        
        
        
        
        
        
        
        
          11,013
        
        
        
      
      
        
          Reversal of Provision for Doubtful Accounts
        
        
        
        
           
        
        
          -
        
        
           
        
        
        
        
           
        
        
          (638
        
        
          )
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating Income
        
        
        
        
        
        
          4,734
        
        
        
        
        
        
        
        
          2,773
        
        
        
      
      
        
          Interest Expense
        
        
        
        
           
        
        
          (2,059
        
        
          )
        
        
        
        
           
        
        
          (1,459
        
        
          )
        
      
      
        
          Income from Continuing Operations Before Taxes
        
        
        
        
        
        
          2,675
        
        
        
        
        
        
        
        
          1,314
        
        
        
      
      
        
          Income Tax Expense
        
        
        
        
           
        
        
          (1,153
        
        
          )
        
        
        
        
           
        
        
          (519
        
        
          )
        
      
      
        
        
        
          Income from Continuing Operations
        
        
        
        
        
        
          1,522
        
        
        
        
        
        
        
        
          795
        
        
        
      
      
        
          Loss From Discontinued Operations, net of Tax
        
        
        
        
           
        
        
          -
        
        
           
        
        
        
        
           
        
        
          (271
        
        
          )
        
      
      
        
        
        
          Net Income
        
        
        
        
          $
        
        
          1,522
        
        
           
        
        
        
        
          $
        
        
          524
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Weighted Average Common Shares Outstanding:
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          Basic
        
        
        
        
           
        
        
          4,126
        
        
           
        
        
        
        
           
        
        
          4,120
        
        
           
        
      
      
        
        
        
          Diluted
        
        
        
        
           
        
        
          4,142
        
        
           
        
        
        
        
           
        
        
          4,300
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net Income Per Common Share:
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          Basic income from continuing operations
        
        
        
        
          $
        
        
          0.37
        
        
           
        
        
        
        
          $
        
        
          0.19
        
        
           
        
      
      
        
        
        
          Basic income (loss) from discontinued operations
        
        
        
        
          $
        
        
          -
        
        
           
        
        
        
        
          $
        
        
          (0.07
        
        
          )
        
      
      
        
        
        
          Basic net income per share
        
        
        
        
          $
        
        
          0.37
        
        
           
        
        
        
        
          $
        
        
          0.13
        
        
           
        
      
      
        
        
        
          Diluted income from continuing operations
        
        
        
        
          $
        
        
          0.37
        
        
           
        
        
        
        
          $
        
        
          0.18
        
        
           
        
      
      
        
        
        
          Diluted income (loss) from discontinued operations
        
        
        
        
          $
        
        
          -
        
        
           
        
        
        
        
          $
        
        
          (0.06
        
        
          )
        
      
      
        
        
        
          Diluted net income per share
        
        
        
        
          $
        
        
          0.37
        
        
           
        
        
        
        
          $
        
        
          0.12
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            EBITDA Reconciliation(a)
          
        
        
        
        
        
        
        
        
        
      
      
        
          Net Income from Continuing Operations
        
        
        
        
          $
        
        
          1,522
        
        
        
        
        
        
          $
        
        
          795
        
        
        
      
      
        
          Interest Expense
        
        
        
        
        
        
          2,059
        
        
        
        
        
        
        
        
          1,459
        
        
        
      
      
        
          Income Tax Expense
        
        
        
        
        
        
          1,153
        
        
        
        
        
        
        
        
          519
        
        
        
      
      
        
          Depreciation and Amortization
        
        
        
        
           
        
        
          1,682
        
        
           
        
        
        
        
           
        
        
          1,798
        
        
           
        
      
      
        
          EBITDA from Continuing Operations
        
        
        
        
          $
        
        
          6,416
        
        
           
        
        
        
        
          $
        
        
          4,571
        
        
           
        
      
      
        
          
            (a) See note above on Use of Non-GAAP Financial Measures.