RTI Inc. Reports Financial Results.SUNLAND PARK Sunland Park may refer to:
RTI RTI - Return from interrupt Inc. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB:RTII RTII Research Triangle Institute International RTII Rti Interrupt ) Financial Review The gross margin of 29% for the first six months of 1999 vs. the negative 7% margin for the same period in 1998 reflects a dramatic turnaround. The primary reason is the AC2 units were not having new field problems that required redesigns of components in 1999. The company has manufacturing facilities in Sunland Park, Westway, Texas Westway is a census-designated place (CDP) in El Paso County, Texas, United States. The population was 3,829 at the 2000 census. Geography Westway is located at (31.959214, -106.574169)GR1. , and Juarez, Mexico. These facilities are operating far under capacity with the present sales level and management is working on several programs to cut costs and increase gross margins to a target of 30% - 35%. The General and Administrative expenses were cut from $643,000 for the first half of 1998 to $512,000 for the same period in 1999. This reflects substantial improvements in the utilization of accounting information and the combination of many jobs to reduce costs. The biggest negative is the increase in interest expense from $146,000 for the first half of 1998 (6% of sales) to $385,000 for the same period in 1999 (19% of sales). This interest expense increase is primarily related to factoring of accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying and inventory financing Inventory financing Used in the context of factoring and general finance to refer to loans to consumer product producers that use inventory as collateral. See also: Inventory loan. to provide working capital. Management Goal Management's main goal for 1999 is to overcome the problems related to the AC2 units and prove the reliable operation of AC2 units in the field. As a consequence of this goal, marketing efforts were cut and an overhead reduction plan was implemented to keep the operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for 1999 below $1 million vs. a nearly $4.5 million loss in 1998. As part of this plan the AC2 marketing expenditures were dramatically cut until product problems could be proven to be solved with field results. The Aireze Marketing was slightly increased and refocused to increase sales strength in the local market and begin expanding sales into the Southwest market area. The net total Selling and Marketing expenditures were cut by almost 40% for the first six months of 1999 vs. the same period in 1998. Accordingly, the AC2 sales were down 53% while Aireze sales were up 37% for the same period. Aireze sales increases were primarily from strengthening sales in the New Mexico New Mexico, state in the SW United States. At its northwestern corner are the so-called Four Corners, where Colorado, New Mexico, Arizona, and Utah meet at right angles; New Mexico is also bordered by Oklahoma (NE), Texas (E, S), and Mexico (S). and El Paso El Paso (ĕl pă`sō), city (1990 pop. 515,342), seat of El Paso co., extreme W Tex., on the Rio Grande opposite Juárez, Mex.; inc. 1873. market. E2Pak sales were down 11% for the first six months because the major customer had a sales slump in its business such that there were no E2Pak sales in the first quarter and the second quarter E2Pak sales were up 50% vsprofitable in 2000. Sale of Superfund Si RTI has suffered the expense of this superfund site because it purchased the property from Thiokol and RTI he responsibility of cleaning the contaminationr plans to develop. There is current incomes (write downs, accruals, and etc., but no cash) of up to $1.1 million (over multiple years). If the buyer closes on the sales transaction and at some point defaefficiency air conditioning air conditioning, mechanical process for controlling the humidity, temperature, cleanliness, and circulation of air in buildings and rooms. Indoor air is conditioned and regulated to maintain the temperature-humidity ratio that is most comfortable and healthful. equipment. RTI has cost efficient to manufacture and AC2's initiaResidential Split Systems 2 - 8 ton capacity (AC2 & S1}, 3) E2Pak and E3Pak Systems (commercial Trio), 4) Industrial/Institutional 50 - 300 ton capacity (Water Chiller egments. The following table shows the sales by 655 -29.47 136 637 -78.65 0 NA Jan-Jun Jan-Jun % Change 99 98 AC2/EvapCon 598 1,292 -53.72 Aireze 1,296 944 37.29 E2Pak 78 88 -11.36 Trio 23 0 NA
In 1997 the AC2 was certified for performance (by ARI) and safety
(by ETL to UL standard 1995), just after the cooling season. For this
reason there was essentially no field installation experience on the
newly designed AC2 units. In 1998 the AC2 product line had substantial
field problems primarily related to a freeze protection control
system.
The problems emerged at the beginning of the 1998 cooling season
after nearly 3,000 AC2 units had been built. The AC2 controls problems
would shut units down erratically and a series of five recalls were
made to attempt to correct the flaws with "immediately available"
alternate controls.
The recalls and the associated re-manufacturing of the AC2 units
to attempt rushed corrections during the 1998 summer cooling season
led to a severe loss in 1998. The controls malfunctions were primarily
caused by a water level sensing device and a submerged temperature
sensing device.
Since the summer of 1998, RTI has redesigned the AC2 unit
controls to eliminate problems experienced in 1998, insure high
reliability in the controls and simplify the controls system. RTI has
taken field experience to enhance the total AC2 reliability and these
enhancements were laboratory verified with good results.
A 1999 AC2 unit Field test program to check operation was briefly
field verified, and then the units in inventory were upgraded. A Field
Upgrade Program is being implemented and units are being upgraded in
the field. During 1998 the repeated controls failures were happening
in the field within a few weeks.
At this point the field results have been very good with half a
season of use, but the controls have not yet been field proven for a
full season, and the field upgrades are still in progress.
The company's development department achieved laboratory
performance results indicating an efficiency of approximately 40 EER
at the SEER efficiency test conditions on the "Trio" product line. The
Trio product line has been field tested, and now over 25 units have
been installed in the El Paso market area.
The results of operations for interim periods are not necessarily
indicative of the results expected for the full year. This press
release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995.
These statements are based on the current plans and expectations
of RTI Inc. and involve risks and uncertainties that could cause
actual future results of operations to be materially different from
those set forth in the forward-looking statements.
Important factors that could cause actual results to differ
include, among others, risks associated with the going concern issues
as stated in the company's 10K, risks associated with product
development and field corrections to the AC2 units, risks of not being
supplied by unpaid vendors, risks due to unpaid taxes, needs for
additional capital, competition, risks of growth in a small and
developing business, and other risks detailed in the company's reports
filed with the Securities and Exchange Commission.
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RTI Inc. and Subsidiaries Consolidated Financial Statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge (Unaudited) Balance Sheet Assets June 30, Dec. 31, 1999 1998 Current Assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. Cash and cash equivalents $-- 0% $9,361 0% Accounts receivable, net of allowance of $10,072 in 1999, and $13,214 in 1998 842,365 15% 191,497 4% Inventory 1,647,859 29% 1,317,649 28% Prepaid expenses and other 248,278 4% 54,228 1% Total current assets 2,738,502 48% 1,572,735 34% Property, Plant and Equipment, Net 1,727,005 30% 1,787,312 39% Due From Related Parties 102,505 2% 111,206 2% Intangible Assets, net of accumulated amortization of $34,250 in 1999, and $21,687 in 1998 1,052,877 19% 1,135,057 24% Other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. 48,428 1% 31,635 1% Total assets $5,669,317 100% $4,637,945 100% The Notes to Financial Statements are an integral part of these consolidated statements. Balance Sheet Liabilities and Stockholders' Equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. June 30, Dec. 31, 1999 1998 Current Liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. Notes payable to related properties $632,648 7.6% $627,811 9.2% Due to related parties BII BII Bank Internasional Indonesia BII British Institute of Innkeepers BII Bioindustry Initiative (US Department of State) BII Bronco II (Ford truck; predecessor of the Explorer) BII Basic Issue Item $231,749 2.8% $174,469 2.6% Notes payable TCC TCC The Car Connection (web site) TCC Tidewater Community College TCC Tallahassee Community College TCC Temporary Continuation of Coverage TCC Tucson Convention Center (Tucson, AZ, USA) $1,910,890 23.0% $606,861 8.9% Due to customer $185,000 2.2% $404,207 6.0% Accounts payable $1,367,041 6.4% $1,088,297 16.0% Accrued expenses $353,508 4.3% $387,208 5.7% Accrued warranty $377,611 4.5% $621,312 9.2% Accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. $257,343 3.1% $139,578 2.1% Capital lease obligation $68,452 0.8% $19,987 0.3% Other current liabilities Other Current Liabilities A balance sheet entry used by companies to group together current liabilities that are not assigned to common liabilities such as debt obligations or accounts payable. $216,341 2.6% $180,000 2.7% Bridge loan $564,002 6.8% $566,502 8.3% Current portion of long term debt $682,364 8.2% $667,926 9.8% Total current liabilities $6,846,953 82.4% $5,484,158 80.8% Long-Term Debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government & Norwest net from current portion $454,248 5.5% $209,858 3.1% Provision for future Environmental Cost $888,955 10.7% $927,140 13.7% Convertible notes $76,000 0.9% Trio deposit (ACE) $23,590 0.3% $- Rockaway Property Tax net of the current portion $23,558 0.3% $167,258 2.5% Total liabilities $8,313,304 100.0% $6,788,414 100.0% Stockholders' Equity Preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. , $.05 par value - shares authorized Shares authorized The maximum number of shares of stock of a company allowed in the articles of incorporation, which may be changed only by a shareholder vote. See: Issued and outstanding. shares authorized See authorized capital stock. 2 million; shares issued and outstanding 100,000 $5,000 $5,000 Common stock; $.08 par value - shares authorized 25 million, issued and outstanding 1,611,166 at year-end 1998 and 1,611,166 at March 31, 1999 $128,894 $128,493 Aditional paid-in capital Paid-in capital Capital received from investors in exchange for stock, but not stock from capital generated from earnings or donated. This account includes capital stock and contributions of stockholders credited to accounts other than capital stock. $18,115,261 $18,115,261 Accumulated deficit $(20,893,142) $(20,399,223) Total stockholders' equity $(2,643,987) $(2,150,469) Total liabilities and stockholders' equity $5,669,317 $4,637,945 Consolidated Statements of Operations Six Months Ended June 30, 1999 1998 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 $2,011,897 $2,308,945 Cost of sales 1,424,108 71% 2,468,338 107% Gross profit (loss) 587,789 29% (159,393) -7% Selling and Marketing 162,604 8% 264,338 11% General and administrative expenses 511,964 25% 643,369 28% Research and development expenses 42,864 2% 97,007 4% Total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. 717,432 36% 1,004,714 44% Loss from operations (129,643) -6% (1,164,107) -50% Other income (expense) Rental income 19,510 1% 10,625 0% Expenses of Rockaway Industrial Park, including interest expense of $5,500 in every year (19,510) -1% Interest income (expense) (385,152) -19% (145,965) -6% Other income - - Total other income (expenses) (385,152) -19% (135,340) -6% Loss from continuing operations (514,795) -26% (1,299,447) -56% Extraordinary Income 113,064 6% 0% Income taxes - - Net loss $(401,731) -20% $(1,299,447) -56% Weighted Average Shares 1,611,166 1,565,599 Net loss per share $(0.25) $(0.83) |
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