Starcraft to Supply OEM With Certified Wheels, Hummer Accessories
GOSHEN, Ind.--Nov. 1, 20038, 2003--Starcraft Corporation announced today the following results for its fourth quarter and fiscal year ended September 28, 2003:-- Revenues increased 84 percent for the fiscal year, 38 percent for the fourth quarter
-- Net income for the fiscal year was $11.8 million, or $2.49 per share and $2.9 million, or $0.60 per share for the quarter.
-- New sales programs announced to immediately distribute 20-inch specialty wheels for GM's Sierra and Silverado trucks, and for certain accessories for additional Hummer products expected later next year.
-- Acquisitions add plastics molding, painting and incremental second-stage manufacturing capabilities to Starcraft's OEM business.
Consolidated revenues for fiscal 2003 were $192 million, versus $105 million in fiscal 2002. Net income was $11.8 million ($2.49 per basic and $2.25 per diluted share), versus prior year earnings of $3.0 million ($0.65 per basic and $0.55 per diluted share).
Revenues for the fourth quarter of fiscal 2003 were $43 million compared to $31 million in the 2002 fourth quarter. Net earnings for the quarter were $2.9 million ($0.60 per basic and $0.54 per diluted share). In fiscal 2002 the Company incurred a net loss of $946,000 ($0.20 basic and diluted loss per share) in the fourth quarter. The fourth quarter of fiscal 2002 included a one-time charge of $2.1 million ($0.45 per share) related to the redemption of certain warrants and options.
As a Tier 1 OEM supplier of customization packages for the Chevrolet and GMC pickup trucks and SUVs, Tecstar and Starcraft continued to benefit from strong consumer demand for these specially equipped premium vehicles along with sales of popular dealer-supplied accessories for the H2 Hummer vehicles.
Tecstar also announced new distribution arrangements with GM's SPO division to offer certain parts through GM dealers. Beginning in the first quarter of fiscal 2004, Tecstar will be distributing ten styles of certified 20-inch wheels, caps and lug nut covers for Chevrolet Silverado and GMC Sierra trucks that dealers can install on new or used vehicles. In addition, Tecstar has expanded its relationship with GM's Hummer program by providing accessory components for additional Hummer products as they roll out next year. When fully implemented, these agreements are estimated to add $60 million in annualized revenues.
Michael H. Schoeffler, Starcraft's President and COO, said that fiscal 2003 was a tremendous year for Starcraft, both because of its dramatic growth and its strategic accomplishments. "In 2003, we significantly exceeded our initial expectations for growth, while improving our profitability. At the same time, we signed a merger agreement with our Tecstar partner, Wheel to Wheel, that will create new opportunities and growth into the future while also synergizing our shareholder's interests along with our operating partners goals."
As previously announced, the Wheel to Wheel merger is subject to shareholder approval. Starcraft expects to mail proxy materials next month pertaining to Starcraft's proposed merger with Wheel to Wheel, an automotive design/engineering firm. Directors and officers representing approximately 36 percent of Starcraft shares have expressed their intention to vote in favor of the merger.
Schoeffler further reported that Starcraft plans to retain its Shreveport, Louisiana plant due to improved prospects for additional business, and the sourcing of supply programs for the Cadillac Escalade ESV and the continued distribution of certain service parts from that location.
"The light truck market continues to be a bright spot in the overall automotive industry, and demand for the enhancements we provide remains strong," Schoeffler said. "We are continuing to plan and execute new programs that respond to consumers' desire for powerful, well-equipped and distinctive trucks and SUVs. We continue to see positive signs that the economy is rebounding, and that fiscal 2004 can be another great year for Starcraft."
Starcraft also announced two acquisitions that add niche capabilities in plastics molding, vehicle painting and second-stage manufacturing.
In October, Starcraft and Wheel to Wheel jointly acquired the assets of Tarxien Automotive in Ontario, Canada. Tarxien, with $3 million in annual sales, was acquired for its OEM-compliant, highly efficient horizontal paint line, and its plastic injection molding facilities that will further support Starcraft's ongoing automotive aftermarket initiatives.
This week, the Company also agreed to acquire the assets of Classic Design Concepts, Inc. of Walled Lake, Michigan. Classic Design provides design and engineering services, concepting and show car development for automotive OEMs, primarily Ford Motor Co. Classic also develops and markets aftermarket parts. Classic Design's senior staff brings additional expertise in direct sales and corporate relationships.
INVESTOR CONFERENCE CALL
The Company will host a conference call on November 19, 2003, at 3 p.m. Eastern Time to discuss its year end results. Investors may participate in the teleconference call by calling 800-901-5217 and providing the conference ID number, 20033633. A tape reply of the call will be available two hours after the conclusion of the conference call through November 26, 2003, by dialing 888-286-8010 and providing the replay pass code #66022600.
Starcraft Corporation, through its ownership interest in Tecstar, LLC is a leading supplier to the OEM automotive supply market. It also supplies after-market parts and accessories to wholesale and retail customers throughout the United States.
STARCRAFT CORPORATION
CONSOLIDATED FINANCIAL RESULTS
FOURTH QUARTER, FISCAL 2003
Dollars in Thousands, except EPS
---------------------------------------------------------------------
Three Months Ended Twelve Months Ended
------------------ -------------------
Statement of Operations Sept. 28, Sept. 29, Sept. 28, Sept. 29,
(unaudited): 2003 2002 2003 2002
-------------------------------------- --------- --------- ---------
Net Sales $42,932 $31,200 $192,102 $104,684
Cost of Goods Sold 33,210 24,665 147,835 79,748
--------- --------- --------- ---------
Gross Profit 9,722 6,535 44,267 24,936
Selling and Promotion
Expenses 489 645 1,866 2,014
General and Administrative
Expenses 5,091 4,281 17,297 13,501
Expense Related to
Redemption of Warrants &
Options - 2,096 (1) - 2,096
Operating Income 4,142 (487) 25,104 7,325
Nonoperating (Expense)
Income:
Interest, Net (150) (88) (457) (144)
Other, Net 15 380 33 257
--------- --------- --------- ---------
(135) 292 (424) 113
Income Before Income Taxes
and Minority Interest 4,007 (195) 24,680 7,438
Income Taxes (1,061) 127 2,060 388
--------- --------- --------- ---------
Income After Income Taxes
and Before Minority
Interest 5,068 (322) 22,620 7,050
Minority Interest in Income
of Subsidiary 2,191 624 10,832 4,087
--------- --------- --------- ---------
NET INCOME $2,877 $(946) $11,788 $2,963
========= ========= ========= =========
Basic Earnings Per Share 0.60 $(0.20) $2.49 $0.65
========= ========= ========= =========
Dilutive Earnings Per Share $0.54 $(0.20)(2) $2.25 $0.55
========= ========= ========= =========
Weighted Average Number of
Basic Common Shares
Outstanding 4,784 4,627 4,738 4,543
========= ========= ========= =========
Weighted Average Number of
Dilutive Common Shares
Outstanding 5,366 4,627 5,233 5,355
========= ========= ========= =========
(1) Reflects one-time expenses related to the redemption of
warrants and options redeemed during the 4th quarter.
(2) Does not reflect effect of employee stock options since
the effect is antidilutive.
----------------------------------------------------------------------
Sept. 28, Sept. 29, Sept. 28, Sept. 29,
2003 2002 2003 2002
---------- --------- ---------- --------
Balance Sheets:(Unaudited) (Audited) (Unaudited)(Audited)
--------------- ---------- --------- ----------- --------
Current Assets: Current
Liabilities:
Notes
Payable to
Cash $836 $284 Related Parties $0 $1,474
Accounts and Accounts
Notes Payable,
Receivable 29,182 22,781 Trade 19,549 18,058
Accrued
Inventories 10,060 8,204 Expenses 7,572 4,534
----------- --------
Total
Other Current Current
Assets 9,002 1,863 Liabilities 27,121 24,066
---------- ---------
Total Current
Assets 49,080 33,132 Long-term Debt 9,148 12,704
Property and
Equipment, net 9,136 5,524 Minority Interest 9,821 1,991
Shareholders'
Other Assets 514 436 Equity 12,640 331
---------- --------- ----------- --------
$58,730 $39,092 $58,730 $39,092
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