ASV Announces 4th Quarter 2004 Results; 4th Quarter EPS Increases 89% to $.36; Full Year Sales Exceed $160 million, EPS Totals $1.28.GRAND RAPIDS Grand Rapids, city (1990 pop. 189,126), seat of Kent co., SW central Mich., on the Grand River; inc. 1850. The second largest city in the state, it is a distribution, wholesale, and industrial center for an area that yields fruit, dairy products, farm produce, , Minn. -- A.S.V., Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ASVI ASVI Alien Status Verification Index ASVI Alien Status Verification Index (US INS) ) today reported results for its fourth quarter and fiscal year ended December 31, 2004. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the fourth quarter of 2004 totaled $48.1 million, compared with $26.2 million for the same period in 2003, with the Company's October 2004 acquisition of Loegering Mfg. Inc. accounting for $6.8 million of the increase. Net earnings for the fourth quarter of 2004 were $5.0 million, or $.36 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared with $2.6 million, or $.19 per diluted share, for the fourth quarter of 2003. Approximately $.02 of the increased earnings per share in 2004 was due to the utilization of greater than anticipated research and development tax credits. For the year ended December 31, 2004, net sales totaled $160.9 million, a 67% increase over net sales of $96.4 million for 2003. Gross profit percentage increased over 100 basis points in 2004, despite rising material prices. Net earnings for the year ended December 31, 2004 totaled $17.2 million, or $1.28 per share, compared with net earnings of $8.7 million, or $.78 per share for 2003. The number of diluted shares outstanding increased 20% in 2004 compared with 2003, due primarily to common stock transactions with Caterpillar caterpillar (kăt`əpĭl'ər, kăt`ər–), common name for the larva of a moth or butterfly. Caterpillars have distinct heads and are segmented and wormlike. in January, the issuance of shares in connection with the acquisition of Loegering Mfg. Inc. in October and the exercise of employee stock options. Commenting on ASV's results, ASV ASV abbr. Bible American Standard Version ASV n abbr (= American Standard Version) → traduction de la Bible ASV n abbr (Bible) (= CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Gary Lemke stated, "ASV's sales for the fourth quarter of 2004 came in slightly over our expectations due to continued strong demand for our R-Series Posi-Track products and increased demand for service parts due to the greater number of machines and undercarriages in service. For the quarter, R-Series products accounted for 36% of our sales while undercarriages for use on Caterpillar's (NYSE NYSE See: New York Stock Exchange : CAT) Multi-Terrain Loaders were 34% of our sales. Sales of Loegering products were 14% of our sales for the quarter, with sales of service parts accounting for 13% and used equipment accounting for 3%. Our gross margin for the fourth quarter of 2004 was consistent with the fourth quarter of 2003, even with increased steel costs of approximately $940,000." For the three months ended December 31, 2004, the Company's selling, general and administrative (S, G & A) expenses increased, as a percentage of net sales, to 6.8%, compared with 6.2% for the same period in 2003. Commenting on this increase, Lemke stated, "Our S, G & A expenses were in our expected range for the quarter, with the increase due to the addition of Loegering's operations for the fourth quarter of 2004, which are not as highly leveraged as ours, and increased compliance costs. Our research and development expenses increased as we continued to invest in the on-going development of new products, including our newest R-Series product, the RCV RCV Receive RCV Ranked Choice Voting RCV Replacement Cost Value RCV Refuse Collection Vehicle RCV Revolve RCV Roll Call Vote RCV Red Cell Volume RCV Reference Change Value RCV Remotely Controlled Vehicle RCV Robotic Combat Vehicle RCV Recent Change and Verify , which was introduced at our dealer meeting in January 2005." The RCV is the industry's first vertical lift machine designed from the ground up to run on a suspended sus·pend v. sus·pend·ed, sus·pend·ing, sus·pends v.tr. 1. To bar for a period from a privilege, office, or position, usually as a punishment: suspend a student from school. rubber track undercarriage. As a result, the distinctive design of the RCV gives it the highest lift height and among the best visibility in its class. Vertical lift machinery represents a growing segment of the skid-steer and rubber track loader A program routine that copies a program into memory for execution. market. A vertical lift machine allows a contractor to lift increased weight while keeping the load closer to the machine with increased reach, which is advantageous for loading and unloading Unloading Selling securities or commodities whose prices are dropping to minimize loss. . The fourth quarter of 2004 was the first quarter that included the results of operations for the Company's newly acquired subsidiary, Loegering Mfg. Inc. of Casselton, ND. Speaking on Loegering, Lemke stated, "Loegering performed well during the fourth quarter of 2004, adding $6.8 million to ASV's sales, with approximately one-half coming from the Versatile Track System, or VTS See VOB and virtual tape system. VTS - A suite of test programs for Motif from OSF. . Customer acceptance of the VTS track system has been very positive during this initial introduction period. The VTS track system was formally introduced to the market at the World of Concrete trade show in Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. in January 2005. Based on the positive response received, we believe the VTS track system could represent a majority of Loegering's sales for 2005." Outlook On December 22, 2004 ASV issued its initial 2005 sales and earnings outlook with sales in the range of $210-230 million and earnings per share expected to be in the range of $1.50-1.65. This earnings per share guidance does not include an estimated $.05 per share effect of implementing FASB FASB See: Financial Accounting Standards Board FASB See Financial Accounting Standards Board (FASB). Standard No. 123(R), Share-Based Payment, requiring the expensing of stock options for the second half of 2005. Continuing, Lemke stated, "With our solid results from 2004, and the positive response to the VTS track system it has received, we are reaffirming our 2005 guidance. We are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that we will see some relief in steel prices, which could aid our anticipated results for 2005." Conference Call ASV will conduct a live Webcast at 9 a.m. Central time, Thursday, February 24th to discuss its results for the fourth quarter of 2004 and its outlook for 2005. The call will be broadcast over the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the and can be accessed at either www.vcall.com or ASV's web site, www.asvi.com, in the investor relations Investor relations The process by which the corporation communicates with its investors. section under the "About ASV" tab. To listen to the call, go to either of the two Web sites at least 15 minutes prior to the call to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any needed audio software. A replay of this call will be available both telephonically and over the Internet approximately one hour after its conclusion. The telephonic replay will be available through 11 p.m. Central time, Friday, February 25th, and can be accessed by dialing 877-660-6853 and entering account number 1628 and conference ID number 140125. The Internet replay will be available for 30 days and can be accessed at www.vcall.com or www.asvi.com in the same manner as discussed above. About ASV ASV designs, manufactures and sells rubber-tracked, all-purpose crawlers and related accessories, attachments and traction Traction Definition Traction is the use of a pulling force to treat muscle and skeleton disorders. Purpose Traction is usually applied to the arms and legs, the neck, the backbone, or the pelvis. products. ASV also manufactures rubber-tracked undercarriages, some of which are a primary component on Caterpillar's Multi Terrain Loaders. With its patented undercarriage technology, ASV leads all rubber-tracked, all-purpose crawlers in technology and innovation. ASV's products are able to traverse traverse - traversal nearly any terrain with minimal damage to the ground, making it effective in industries such as construction, landscaping and agriculture. For more information, visit ASV's website at www.asvi.com or Loegering's website at www.loegering.com. Note: The statements set forth above regarding ASV's future expected sales and earnings levels and the benefits of Loegering's products and technology, including its VTS track system are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. based on current expectations and assumptions, and entail entail, in law, restriction of inheritance to a limited class of descendants for at least several generations. The object of entail is to preserve large estates in land from the disintegration that is caused by equal inheritance by all the heirs and by the ordinary various risks and uncertainties that could cause actual results to differ materially from those expressed in such forward-looking statements. Certain factors may affect whether these anticipated events occur including the risks and uncertainties associated with successfully integrating the operations of Loegering, unanticipated delays, costs and expenses inherent in the development, manufacturing and marketing of new products; developments in the demand for each companies' products; ASV's ability to successfully manufacture its products; unanticipated problems or delays experienced by Caterpillar relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the manufacturing or marketing of the MTL MTL In currencies, this is the abbreviation for the Maltese Lira. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. machines; market acceptance of the machines; deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. of the general market and economic conditions; corporate developments at ASV or Caterpillar; ASV's ability to realize the anticipated benefits from its relationship with Caterpillar and Loegering; relationships with major customers and suppliers; the ability to retain key personnel; the impact of governmental laws and regulations; competitive factors; and any future acts or threats of terrorism or war. Any forward-looking statements provided from time-to-time by the Company represent only management's then-best current estimate of future results or trends. Additional information regarding these risk factors and uncertainties is detailed from time to time in the Company's SEC filings, including but not limited to, its report on Form 10-Q Form 10-Q See 10-Q. for the period ended June 30, 2004.
Condensed financial statements are as follows:
A.S.V., INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------------------------------------
2004 2003 2004 2003
------------------------------------------------
Net sales $48,131,056 $26,171,219 $160,873,320 $96,386,576
Cost of goods sold 37,372,998 20,328,060 124,473,593 75,895,524
------------------------------------------------
Gross profit 10,758,058 5,843,159 36,399,727 20,491,052
Operating expenses:
Selling, general
and
administrative 3,263,554 1,622,538 9,604,619 6,177,324
Research and
development 545,429 237,934 1,106,762 794,729
------------------------------------------------
Operating
income 6,949,075 3,982,687 25,688,346 13,518,999
Other income (expense)
Interest income 259,481 60,131 833,307 140,366
Interest expense (39,539) (29,391) (124,223) (129,359)
Other, net 24,042 12,032 27,719 37,897
------------------------------------------------
Income
before
income
taxes 7,193,059 4,025,459 26,425,149 13,567,903
Provision for income
taxes 2,225,000 1,440,000 9,250,000 4,850,000
------------------------------------------------
NET EARNINGS $ 4,968,059 $ 2,585,459 $ 17,175,149 $ 8,717,903
================================================
Net earnings per
common share -
Diluted $ .36 $ .19 $ 1.28 $ .78
================================================
Diluted weighted
average shares 13,727,550 13,452,589 13,412,500 11,185,683
================================================
A.S.V., INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS December 31, December 31,
2004 2003
------------------------
CURRENT ASSETS
Cash & short-term investments $ 37,000,629 $29,708,418
Accounts receivable, net 36,431,774 15,661,269
Inventories 34,832,868 26,686,707
Other current assets 2,237,096 3,614,506
------------------------
Total current assets 110,502,367 75,670,900
LONG-TERM INVESTMENTS 5,912,747 --
LONG-TERM NOTE RECEIVABLE, less current
portion 703,445 823,334
PROPERTY AND EQUIPMENT, net 11,108,132 6,129,922
INTANGIBLES, net 8,002,251 --
GOODWILL 8,385,827 --
------------------------
Total assets $144,614,769 $82,624,156
========================
LIABILITIES & SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term liabilities $ 189,656 $ 136,414
Accounts payable 11,452,026 6,004,890
Accrued liabilities 4,494,522 2,358,473
Income taxes payable 533,995 --
------------------------
Total current liabilities 16,670,199 8,499,777
LONG-TERM LIABILITIES, less current portion 1,873,768 1,844,858
SHAREHOLDERS' EQUITY 126,070,802 72,279,521
------------------------
Total liabilities & shareholders'
equity $144,614,769 $82,624,156
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