UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF |
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For the quarterly period ended March 31, 2003 |
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or |
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TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF |
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For the transition period from to |
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Commission File Number 1-13025 |
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AirNet Systems, Inc. |
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(Exact name of registrant as specified in its charter) |
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Ohio |
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31-1458309 |
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(State or other
jurisdiction |
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(I.R.S. Employer |
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3939
International Gateway |
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(Address, including zip code, of registrant’s principal executive offices) |
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(614) 237-9777 |
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(Registrant’s telephone number, including area code) |
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Not Applicable |
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(Former name, former address and former fiscal year, if changed since last report) |
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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 ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý
As of May 8, 2003, there were 10,131,978 shares of the registrant’s common stock, par value $0.01, outstanding.
TABLE OF CONTENTS
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PART I. FINANCIAL INFORMATION |
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Item 1. |
Financial Statements: |
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Condensed
Consolidated Balance Sheets: |
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Notes to Condensed Consolidated Financial Statements (Unaudited) |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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2
AIRNET SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
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March 31, |
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December 31, |
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(unaudited) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
2,372 |
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$ |
1,484 |
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Accounts receivable, less allowances |
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18,928 |
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19,029 |
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Inventory and spare parts |
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7,438 |
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6,926 |
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Deferred income taxes |
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220 |
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220 |
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Deposits and prepaids |
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3,145 |
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3,675 |
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Total current assets |
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32,103 |
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31,334 |
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Net property and equipment |
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112,275 |
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111,349 |
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Other assets: |
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Goodwill, net of accumulated amortization |
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4,018 |
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4,018 |
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Other |
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610 |
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1,002 |
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Total assets |
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$ |
149,006 |
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$ |
147,703 |
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LIABILITIES AND SHAREHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
7,198 |
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$ |
6,008 |
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Salaries and related liabilities |
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3,977 |
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4,568 |
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Accrued expenses |
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2,431 |
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897 |
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Taxes payable |
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471 |
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499 |
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Current portion of notes payable |
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5,193 |
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5,193 |
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Total current liabilities |
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19,270 |
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17,165 |
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Other liabilities |
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103 |
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106 |
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Notes payable, less current portion |
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35,705 |
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36,601 |
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Deferred income taxes |
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13,036 |
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13,035 |
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Shareholders’ equity: |
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Preferred shares, $.01 par value; 10,000 shares authorized; no shares issued and outstanding |
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— |
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— |
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Common shares, $.01 par value; 40,000 shares authorized; 12,753 shares issued at March 31, 2003 and at December 31, 2002 |
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128 |
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128 |
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Additional paid-in-capital |
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77,046 |
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77,152 |
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Retained earnings |
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29,456 |
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29,158 |
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Accumulated other comprehensive loss |
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(57 |
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(59 |
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Treasury shares, 2,641 and 2,599 shares held at cost at March 31, 2003 and December 31, 2002, respectively |
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(25,681 |
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(25,583 |
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Total shareholders’ equity |
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80,892 |
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80,796 |
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Total liabilities and shareholders’ equity |
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$ |
149,006 |
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$ |
147,703 |
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See notes to condensed consolidated financial statements
3
AIRNET SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share data)
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Three Months Ended |
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2003 |
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2002 |
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NET REVENUES |
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Air transportation, net of excise tax |
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Bank services |
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$ |
26,323 |
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$ |
24,792 |
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Express services |
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11,442 |
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9,706 |
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Aviation services and other operations |
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1,743 |
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1,099 |
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Total net revenues |
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$ |
39,508 |
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35,597 |
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COSTS AND EXPENSES |
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Wages and benefits |
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5,554 |
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4,883 |
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Aircraft fuel |
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4,942 |
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3,565 |
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Aircraft maintenance |
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3,381 |
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2,864 |
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Contracted air costs |
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4,261 |
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3,630 |
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Ground courier |
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6,415 |
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5,921 |
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Depreciation |
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4,209 |
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4,353 |
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Other |
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3,841 |
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3,323 |
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Selling, general and administrative |
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6,014 |
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4,831 |
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Total costs and expenses |
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38,617 |
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33,370 |
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Income from operations |
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891 |
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2,227 |
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Interest expense |
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