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FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934


 
For Quarter Ended
     December 31, 2004
 
Commission File Number
     
0-11720


Air T, Inc.
(Exact name of registrant as specified in its charter)


Delaware
  
52-1206400
(State or other jurisdiction of
  
(I.R.S. Employer
incorporation or organization)
  
Identification No.)

Post Office Box 488, Denver, North Carolina 28037
(Address of principal executive offices)
 
(704) 377-2109
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes x        No ¨

Indicated by check mark whether the registrant is an accelerated filer (as defined in Rule 126-2 of the Exchange Act)

Yes ¨        No x

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

2,710,334 Common Shares, par value of $.25 per share were outstanding as of January 21, 2005.


This filing contains 27 pages.

  
  1  
 

AIR T, INC. AND SUBSIDIARIES

INDEX

 
Page
PART I. FINANCIAL INFORMATION
  
       
       
 
Item 1.
Financial Statements
  
       
 
Condensed Consolidated Statements of Operations for the three and nine-month periods ended December 31, 2004 and 2003 (Unaudited)
3
     
 
Condensed Consolidated Balance Sheets at December 31, 2004 (Unaudited) and March 31, 2004
4
     
 
Condensed Consolidated Statements of Cash Flows for the nine-month periods ended December 31, 2004 and 2003 (Unaudited)
5
     
 
Condensed Consolidated Statements of Stockholders’ Equity and Comprehensive Income (Loss) for the nine-month periods ended December 31, 2004 and 2003(Unaudited)
6
     
 
Notes to Condensed Consolidated Financial Statements (Unaudited)
7-11
     
 
Item 2.
Management’s Discussion and Analysis of Financial
 
 
Condition and Results of Operations
12-19
       
 
Item 3.
Quantitative and Qualitative Disclosure About Market Risk
19
 
    
 
Item 4.
Controls and Procedures
19-20
     
PART II. OTHER INFORMATION
  
     
 
Item 1.
Legal Proceedings
21
       
 
Item 2.
Changes in Securities, Use of Proceeds and Issuer
 
   
Purchases of Equity Securities
21
       
 
Item 4.
Submission of Matters to a Vote of Security Holders
22
       
 
Item 6.
Exhibits
22
     
   
Signatures
23
     
     
   
Exhibit Index
24
     
     
   
Officers’ Certifications
25-27


  
  2  
 


AIR T, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

 
  
Three Months Ended  
Nine Months Ended
 
  
December 31, 
December 31,
     
2004
    
2003
    
2004
    
2003
  
Operating Revenues:
                          
Overnight air cargo
  
$
10,066,069
  
$
10,050,669
  
$
28,669,675
  
$
25,850,443
  
Ground equipment
    
8,267,516
   
2,929,464
   
21,116,387
   
11,808,829
 
     
18,333,585
   
12,980,133
   
49,786,062
   
37,659,272
 
                           
Operating Expenses:
                          
Flight-air cargo
    
4,193,755
   
4,096,976
   
12,134,053
   
10,951,845
 
Maintenance-air cargo
    
4,482,079
   
4,174,526
   
11,823,975
   
9,709,612
 
Ground equipment
    
6,607,757
   
2,320,453
   
16,586,117
   
8,970,654
 
General and administrative
    
2,092,069
   
1,762,169
   
6,201,507
   
5,497,190
 
Depreciation and amortization
    
182,809
   
132,886
   
482,522
   
408,263
 
     
17,558,469
   
12,487,010
   
47,228,174
   
35,537,564
 
                           
Operating Income
   
775,116
   
493,123
   
2,557,888
   
2,121,708
 
                           
Non-operating (Income) Expense:
                          
Interest, net
    
23,246
   
14,909
   
74,894
   
(75,249
)
Deferred retirement expense
    
5,250
   
5,250
   
15,750
   
15,750
 
Investment income and other
    
(17,406
)
  
(20,496
)
  
(63,459
)
  
(86,799
)
Gain on asset sale
    
-
   
-
   
(6,616
)
  
-
 
     
11,090
   
(337
)
  
20,569
   
(146,298
)
                           
Earnings From Continuing
                         
Operations Before Income Taxes
    
764,026
   
493,460
   
2,537,319
   
2,268,006
 
                           
Income Tax Expense
   
278,736
   
184,654
   
980,463
   
903,137
 
                           
Earnings From Continuing
                         
Operations
 
$
485,290
  
$
308,806
  
$
1,556,856
  
$
1,364,869
  
                           
Loss From Discontinued Operations,
                          
Net of Income taxes
    
-
   
(78,786
)
  
-
   
(427,643
)
                           
Net Earnings
  
$
485,290
  
$
230,020
  
$
1,556,856
  
$
937,226
  
                           
Basic and Diluted Earnings (Loss) Per Share:
                  
Continuing Operations
  
$
0.18
  
$
0.11
  
$
0.58
  
$
0.50
  
Discontinued Operations
    
-
   
(0.03
)
  
-
   
(0.16
)
Total Basic and Diluted Net Earnings Per Share
  
$
0.18
  
$
0.08
  
$
0.58
  
$
0.34
  
                           
Weighted Average Shares Outstanding:
                          
 Basic
    
2,693,001
   
2,726,320
   
2,679,054
   
2,726,320
 
 Diluted
    
2,693,586
   
2,747,928
   
2,699,878
   
2,730,717
 

See notes to condensed consolidated financial statements.

  
  3  
 

AIR T, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

   
DECEMBER31,2004
    
MARCH 31, 2004
  
ASSETS
    
(Unaudited
)
      
Current Assets:
              
 Cash and cash equivalents
  
$