Art's Way Manufacturing Updates Financial Results

By CnAgri2012-07-13 19:55:14 Print

Art's Way Manufacturing Co., Inc., Armstrong, Iowa, a leading manufacturer and distributor of agricultural machinery, equipment and services announces its financial results for the three and six months ended May 31, 2012.

-- Net Sales: Consolidated corporate sales for the three- and six-month period ended May 31, 2012 were approximately $11,685,000 and $17,997,000, respectively, compared to $7,845,000 and $12,509,000 during the same respective periods in 2011, a $3,840,000 increase for the quarter and $5,488,000 increase year-to-date, or 48.9% and 43.9% increases, respectively.

-- Agricultural Products: Second fiscal quarter sales for our agricultural products segment were $8,006,000 compared to $6,664,000 during the same period of 2011, an increase of $1,342,000, or 20.1%. Year-to-date sales were up to $11,994,000, from $10,321,000 as of May 31, 2011, an increase of $1,673,000, or 16.2%. Gross margin for the quarter ended May 31, 2012 was 30.7% compared to 28.3% for the same period in 2011. The year-to-date gross margin was 29.2%, compared to 24.0% as of May 31, 2011. The gross margin increase is attributable to increased manufacturing efficiencies at our Armstrong plant during the quarter ended May 31, 2012.

-- Pressurized Vessels: Second fiscal quarter sales for our pressurized vessels were $617,000, compared to $402,000 for the same period in 2011, an increase of $215,000, or 53.5%. Year-to-date sales were $946,000, compared to $965,000 for the six-month period ending May 31, 2011, a decrease of $19,000, or 2.0%. Gross margin for the quarter ended May 31, 2012 was 8.1% compared to (10.8%) for the same period in 2011. Year-to-date gross margin was 0.9% compared to (15.4%) as of May 31, 2011. The production manager hired during Q1 of 2011 has improved our ability to track cost and revenue on a per-job basis.

-- Modular Buildings: Second fiscal quarter sales for our modular buildings segment were $3,062,000, compared to $779,000 for the same period in fiscal 2011, an increase of $2,283,000, or 293.0%. The increase was primarily attributable to revenue from an approximately $7 million fabrication and delivery contract executed in January 2012 and an approximately $1.7 million installation contract executed in April 2012. Our modular buildings segment was hired to design, fabricate, and install twenty-four modular units over the course of approximately one year for one of the world's leading research and teaching institutions. Gross margin for the quarter ended May 31, 2012 was 21.3% compared to 14.7% for the same period in 2011. Year-to-date gross margin was 22.2% compared to 8.3% as of May 31, 2011. The gross margin increase was primarily due to the $7 million contract.

-- Income: Consolidated net income was $936,000 and $1,129,000 for the three and six months ended May 31, 2012, compared to net income of $291,000 and a net loss of $-194,000 for the same respective periods in 2011. The changes to net income were primarily attributable to an increase in consolidated sales and improved gross profit across all segments for the three-month period ended May 31, 2012.

-- Earnings per Share: Earnings per basic share during the second fiscal quarter ended May 31, 2012 were $0.23 compared to $0.07 for the same period during 2011. Earnings per basic share during the six months ended May 31, 2012 were $0.28 compared to a loss per basic share of $0.05 for the same period during 2011.

J. Ward McConnell, Jr., chairman of the Board, said, "I am extremely pleased to report strong revenue of $11.7 million, net income of $935,980 and earnings per share of $0.23 for the second fiscal quarter ended May 31, 2012. Our business momentum has continued into 2012 with strong sales performance from each of our business segments and this is an excellent example of our balanced business model in action.

"Agricultural Products had an 16.2% increase in sales, Modular Buildings improved 293% in sales year over year, and Pressurized Vessels grew 53.5% in sales, during the second quarter year over year. The financial strength of our business model is reflected in a consolidated increase in sales of 43.9%, and an increase in net income of approximately $1,300,000, year-over-year.

"I remain optimistic about the future of Art's Way and we intend to continue to pursue disciplined, profitable growth. Our momentum is strong, and we are excited about the prospects for delivering another year of improved revenue and earnings to our shareholders."