SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________
FORM 10-Q
Quarterly Report Under Section 13 or 15 (d) of the Securities Exchange Act of
1934
For Quarter Ended March 31, 1995 Commission File Number 0-10190-0
AERO SERVICES INTERNATIONAL, INC.____________________
(Exact name of registrant as specified in its charter)
Louisiana 72-0385274
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
660 Newtown Yardley Road
Newtown, PA 18940
Registrant's telephone number, including area code (215) 860-5600
Indicate by check mark whether the registrant (1) 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 and (2) has been subject to such filing requirements for
the past 90 days.
Yes X No
6,998,052 Common Shares were outstanding as of March 31, 1995
AERO SERVICES INTERNATIONAL, INC. & SUBSIDIARIES
INDEX
PART I - Financial Information Page Number
Item 1. Financial Statements
Condensed Consolidated Balance Sheet
March 31, 1995 (unaudited) and
September 30, 1994 (audited) 2
Cosolidated Statement of Earnings
three months ended March 31, 1995
and 1994 (unaudited) 3
Condensed Consolidated Statement of Cash Flows
three months ended March 31, 1995 and 1994
(unaudited) 4
Notes to Condensed Consolidated Financial Statements
(unaudited) 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operation 8
PART II - Other Information
Item 1. Legal Proceedings 11
Item 6. Exhibits and Reports on Form 8-K 12
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED
CONDENSED BALANCE SHEET
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS)
AS AT AS AT
MARCH 31 SEPTEMBER 30
1995 1994
ASSETS
Cash $ 1,439 $ 2,406
Restricted Cash 5 5
Accounts Receivable Less Allowance for
Doubtful Accounts of $92 & $147 respectively 609 1,214
Notes Receivable - Affiliate 280
Other Receivable - Affiliate 27
Inventories Less Reserve for
Slow Moving of $53 & $85 respectively 72 454
Other Current Assets 381 406
TOTAL CURRENT ASSETS $ 2,813 $ 4,485
Property & Equipment - Net 2,181 2,336
Assets held for sale at Net Book Value 447
Other Assets 150 150
TOTAL ASSETS $ 5,144 $ 7,418
LIABILITIES & STOCKHOLDERS DEFICIT
Current Maturities of Long-Term Debt $ 40 $ 194
Accounts Payable 560 1,293
Other Liabilities 3,068 3,564
Other Liabilities - Affiliate 435 8
TOTAL CURRENT LIABILITIES $ 4,103 $ 5,059
Long-Term Debt - Affiliate $ 15,610 $15,428
Long-Term Debt - Other 3,570 4,189
Other Long-Term Liabilities 248 305
Redeemable Preferred Stock 5,540 5,388
TOTAL LONG-TERM LIABILITIES $ 24,968 $25,310
STOCKHOLDERS' DEFICIT
Common Stock $ 8,550 $ 8,702
Additional Paid-in Capital 3,380 3,380
Accumulated Deficit (35,620) (34,796)
$ (23,690) $(22,714)
Less Treasury Stock 237 237
TOTAL STOCKHOLDERS' DEFICIT $ (23,927) $(22,951)
TOTAL LIABILITIES & STOCKHOLDERS DEFICIT $ 5,144 $ 7,418
NOTE: The balance sheet at September 30, 1994 has been taken from the audited
financial statements at that date and condensed.
See Notes to Condensed Consolidated Financial Statements.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENT OF EARNINGS
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS)
THREE MONTHS ENDED SIX MONTHS ENDED
MARCH 31, MARCH 31,
1995 1994 1995 1994
NET SALES $ 2,559 $ 5,132 $ 6,001 $ 11,788
COST AND EXPENSE
Cost of Sales $ 1,340 $ 2,723 $ 3,084 $ 6,302
Departmental Costs 1,307 2,532 2,814 5,524
Administrative Costs 256 642 560 1,233
Interest Expense - Other 52 76 114 194
Interest Expense - Affiliate 383 262 734 552
$ (779) $(1,103) $(1,305) $(2,017)
Gain on Sale of Certain FBO
Operations 75 1,686 292 1,686
Other Income/(Expense), Net 60 16 189 (30)
NET INCOME (LOSS) $ (644) $ 599 $ (824) $ (361)
Income/(Loss) per Common and
Common Equivalent Share $ (.10) $ .08 $ (.14) $ (.13)
Fully diluted earnings per
Common Share $ - $ .07 $ - $ -
See Notes to Condensed Consolidated Financial Statements.
AERO SERVICES INTERNATIONAL, INC.
Condensed Consolidated Statement of Cash Flows
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS)
SIX MONTHS ENDED
MARCH 31,
1994 1995
CASH FLOWS FROM OPERATING ACTIVITIES
Net (Loss) $ (824) $ (361)
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Depreciation and Amortization 155 406
Provisions for Obsolete, Slow-Moving & Excess
Inventory 6
Provision for Losses on Accounts Receivable 21 54
Amortization of Discounted Note Payable 182
(Gain) Loss on Sale of Certain FBO Operations (292) (1,686)
(Gain) Loss on Sale of Fixed Assets (120) (70)
Other Assets included in Sale of FBO Operations (528)
Other 83 (170)
Change in Assets and Liabilities:
(Increase) Decrease in Accounts Receivable 584 466
(Increase) Decrease in Notes Receivable - Affiliate (280)
(Increase) Decrease in Other Receivable - Affiliates (27)
(Increase) Decrease in Inventory 382 167
(Increase) Decrease in Other Current Assets 25 (46)
Increase (Decrease) in Accounts Payable (733) (40)
Increase (Decrease) in Accounts Payable - Affiliate (1,169)
Increase (Decrease) in Other Current Liabilities (496) (39)
Increase (Decrease) in Other Liabilities - Affiliate 427
Increase (Decrease) in Other Long Term Liabilities (57)
Total Adjustments (674) (2,121)
Net Cash Provided by (Used In) Operating Activities (1,498) (2,482)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of Property and Equipment (36) (29)
Proceeds from Sale of Fixed Assets 3
Proceeds from Sale of FBOs 973 4,900
Net Cash From (Used In) Investing Activities 940 4,871
CASH FLOWS FROM FINANCING ACTIVITIES
Principal Payment of Notes Payable (379) (29)
Principal Payments of Long-Term Debt (30) (2,829)
Net Cash Provided By (Used In) Financing Activities (409) (2,858)
Net Increase (Decrease) in Cash & Cash Equivalents (967) (469)
Cash and Cash Equivalents at Beginning of Year 2,406 537
Cash and Cash Equivalents at End of First Fiscal
Quarter $ 1,439 $ 68
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash Paid during the Period for:
Interest $ 241 $ 277
Income Taxes 11 9
See Notes to Condensed Consolidated Financial Statements.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statement
March 31, 1995
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS)
NOTE 1: CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated balance sheet as of March 31, 1995, consolidated
statement of earnings for the six month and three month periods ended March 31,
1995, and the condensed consolidated statement of cash flows for the six month
period then ended were prepared by the Company, without audit. In the opinion
of management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations, and cash flows at March 31, 1995 and for all periods presented have
been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these condensed financial
statements be read in conjunction with the financial statements and notes
thereto included in the Company's September 30, 1994 annual report on Form 10-K
The results of operations for the periods ended March 31, 1995 and 1994 are
not necessarily indicative of the operating results for the full year.
NOTE 2: CASH AND SHORT-TERM SECURITIES
The Company considers cash on hand and deposits in banks as cash and cash
equivalents. All items in this category have maturities of less than three
months.
NOTE 3: INVENTORIES
Inventories are classified as follows:
MARCH 31 SEPTEMBER 30
1995 1994
Aircraft parts and accessories, oil and
supplies less provisions for obsolete
and slow-moving, and excess quantity
of $53 and $85, respectively $ 34 $ 342
Fuel 35 57
Work-In-Process 3 55
$ 72 $ 454
NOTE 4: OTHER ASSETS
Included in the balance of Other Assets at both March 31, 1995, and September
30, 1994, is a certificate of deposit in the amount of $150, with a maturity
date of October 21, 1995 which supports an irrevocable letter of credit due to
expire in April 1996.
NOTE 5: RELATED PARTY TRANSACTIONS
In May 1994 Transtech Holding Company, Inc. (Transtech) acquired Triton Energy
Corporation's (Triton) equity in the Company and also purchased Company debt
from Triton consisting of $15,610 of principal and $2,723 of accrued interest
and fees. The $2,723 was forgiven and recorded as additional paid-in-capital.
Transtech agreed to forgo any accrual of interest on the principal through
November 20, 1994. This interest amounted to $657 which was recorded as
additional paid-in-capital and as a discount to notes payable at September 30,
1994. The discount has been amortized as interest expense over the six month
period during which no interest was accrued to Transtech. The six months ended
March 31, 1995 includes $182 of amortized discount. Accrual of interest began
again on November 21, 1994. Through March 31, 1995 interest of $551 has been
accrued on the principal and $116 has been paid with the balance of $435 shown
as Other Liabilities - Affiliate on the balance sheet as of that date.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
March 31, 1995
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS)
NOTE 5: RELATED PARTY TRANSACTIONS (continued)
In August 1994 the Company entered into an agreement with Transtech to provide
accounting services to three fixed based operations (FBOs) owned or controlled
by Transtech for a monthly fee totalling twenty-six hundred dollars per month.
Through March 31, 1995 the Company has billed Transtech $26 including expenses
and has been paid $14.
On December 23, 1994 in anticipation of aquiring all of its outstanding stock,
the Company advanced $150 to Mountain State Flight Services, Inc.,
(Mountain State) a West Virginia corporation, secured by a promissory note
bearing interest at the rate of nine percent per annum, and due and payable on
February 22, 1995. R. Ted Brant, the Chairman of the Board of Directors and
Chief Executive Officer of the Company is also President of, and a shareholder
of, Mountain State. Another $30 was advanced on February 3, 1995 and an
additional $100 was advanced on February 21, 1995, secured by a promissory note.
On April 1, 1995, the Company bought 100% of the outstanding stock of Mountain
State for $110. There were no repayments of any of the $280 of notes prior to
the sale. The purchase price of $110 has not been paid as of the filing date
because all of the stock certificates outstanding had not been received.
NOTE 6: LONG-TERM DEBT
The balance of $15,610 in Long-Term Debt - Affiliate at March 31 is the total
of the notes due Transtech. The balance of $15,428 at September 30 is net of
the $182 discount which was amortized through November. The balance of $3,570
in Long-Term Debt - Other at March 31 is totally indebtedness on industrial
revenue bonds. The balance of $4,189 at September 30 includes indebtedness on
industrial revenue bonds of $3,593, $353 due on a capital lease, and $243 on
two notes. The $353 due on the capital lease was assumed by the buyer of the
Company's FBO at Saginaw, MI on December 31, and the $243 balance on the notes
was paid in full in December.
NOTE 7: CERTAIN FIXED BASE OPERATION (FBO) MATTERS
On December 31, 1994 the sale of the Company's facility at Saginaw, Michigan
was completed. The purchase price was $300 plus the assumption of the fuel
farm capital lease in the amount of $387, and a gain of $217 was recognized on
the sale.
In January 1995 the Company received a letter of intent to purchase its
facility at the Youngstown, Ohio Airport. The sale was completed on February
10, 1995. The selling price was $120 for the fixed assets and $463 for the
inventories,
including work in process. The Company recorded a gain of $76 on this sale.
As disclosed in NOTE 5, the Company purchased the stock of Mountain State
Flight Services, Inc. on April 1, 1995. For the year ended December 31, 1994,
Mountain State generated a loss of $78 on sales of $834. For the years ended
December 31, 1993 and 1992, respectively, Mountain State generated a profit of
$31 on sales of $382, and a loss of $1 on sales of $340. Mountain State has
a Letter of Intent with a Fortune 500 company to lease a 25,000 square foot
facility for a period of 10 years with two five year options. This facility
is to be constructed on the premises with construction scheduled to begin by
June 15, 1995. Mountain State holds a lease to operate an FBO at Morgantown
Airport until December 31, 2007 with two additional five year options.
8: OTHER LIABILITIES
At March 31, 1995 the major components of the $3,068 balance are accrued
property, payroll, and other taxes of $1,700; accrued EPA expenses of $449;
accrued salaries of $95, and accrued auditing and professional fees of $163.
At September 30, the major components of the $3,564 balance were property,
payroll, and other taxes of $1,685; accrued EPA expenses of $592; accrued
salaries of $220; and accrued auditing and professional fees of $159.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
March 31, 1995
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS)
NOTE 9: CONTINGENT LIABILITIES
A. Environmental Matters
The Company's business involves the storage, handling and sale of aviation
fuel; and the provision of mechanical maintenance and refurbishing services
which involve the use of hazardous chemicals. Accordingly, the Company is
required to
comply with federal, state and local regulations which have been enacted to
control the discharge of material into the environment or otherwise relate to
the protection of the environment. As a normal course of business, the Company
from time to time discusses environmental compliance with the appropriate
environmental agency.
At September 30, 1994, the Company had accrued $750 for expenses related to
environmental protection, assessment and remediation matters at certain
locations. At March 31, 1995, the financial statements of the Company included
accruals for resolution of environmental matters in the amount of $449 based
upon identified situations and cost estimates provided by firms and individuals
knowledgeable of such matters. These estimates are subject to change dependent
upon additional information and revisions to governing regulations.
The expenditures and accruals for environmental matters are specific in nature
to identified situations at Company locations. The Company is presently
responsible for remediation projects at three locations, none of which are
presently owned. It is possible that two of these projects will be completed
by the end of the current fiscal year. However, it may take additional time
to receive closure permission from the appropriate EPA officials. Due to
uncertainties related to estimating both elapsed correction time and the
effectiveness of environmental remediation techniques utilized to correct non-
compliance situations, the Company may incur additional costs in future periods
related to these same situations.
B. Tax Assessment
On December 19, 1994, the Company received a notice of tax due from the State
of New York in the amount of $163 for a diesel motor fuels tax covering the
quarter ended November 30, 1991. In March 1995 the Company received a notice
of tax due in the amount of $147 for the quarter ended February 29, 1992.
Additional notices are expected which could bring the total assessment in
excess of $1,000. Management believes this assessment to be in error and
has filed an appeal with the State of New York. A date for the hearing has not
been set.
C. Litigation
Please refer to Part II, Item 1 on page 10 for a full discussion of current
litigation matters.
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
(DOLLAR AMOUNTS IN THOUSANDS)
Results of Operations:
The following table presents as a percentage of total sales certain selected
financial data for the Company for the periods indicated.
Three Months Ended Six Months Ended
March 31 March 31
1995 1994 1994 1995
Net Sales 100.0% 100.0% 100.0% 100.0%
Cost of Sales 52.4 53.1 51.4 53.5
Departmental Costs 51.1 49.3 46.9 46.9
Administrative Costs 10.0 12.5 9.3 10.5
Interest Expense (Net) 17.0 6.6 14.1 6.3
Other Income/(Expense) 5.3 33.2 8.0 14.1
Net Income/(Loss) (25.2) 11.7 (13.7) (3.1)
Revenues for the three months ended March 31, 1995 declined 50% as compared to
the same period for the previous year to $2,559. The decline in revenue for the
six months was 49%. These declines are the result of certain FBO sales in
fiscal 1994 and 1995. In order to compare the results of continuing operations,
a statement of earnings for both periods is presented below, including only
those three FBOs which were in operation during all of both periods.
CONTINUING OPERATIONS
THREE MONTHS ENDED
Mar. 31, Mar. 31,
1995 % 1994 %
Net Sales $ 2,181 100.0 $ 2,124 100.0
COST AND EXPENSE
Cost of Sales 1,169 53.6 1,188 55.9
Departmental Costs 1,109 50.8 1,123 52.9
Administrative Costs 224 10.3 401 18.9
Interest Expense 434 19.9 307 14.5
Other income, Net 57 2.6 548 25.9
NET (LOSS) $ (698) (32.0) $ (347) (16.3)
As shown above, revenues at continuing operations increased 2.7% during the
quarter ended March 31, 1995 compared to the previous year. The volume of fuel
sold increased 10.1% and the resulting revenue increased 10.8%. The sales of
maintenance services increased only 1% over last year.
Cost of sales decreased 2.3% as a percentage of sales in the current quarter.
Departmental costs during the current quarter decreased $14 over last year, and
also decreased as a percentage of sales by 2.1 percentage points to 50.8%.
Administrative costs have been reduced by $177 to 10.3% of sales, down from 18.9
last year.
Interest expense has increased $127 as compared to the prior year as a result of
interest rate increases that began in the fall of 1994.
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
(DOLLAR AMOUNTS IN THOUSANDS)
Results of Operations (continued):
CONTINUING OPERATIONS
SIX MONTHS ENDED
Mar. 31, 1995 % Mar. 31, 1994 %
Net Sales $ 4,317 100.0 $ 4,208 100.0
COST AND EXPENSE
Cost of Sales 2,215 51.3 2,252 53.5
Departmental Costs 2,082 48.2 2,200 52.3
Administrative Costs 505 11.7 706 16.8
Interest Expense 843 19.5 648 15.4
Other Income (expense)
Net 161 3.7 579 13.8
NET (LOSS) $ (1,167) (27.0) (1,019) (24.2)
Revenues at continuing operations increased 2.6% in the first six months of
fiscal 1995 compared to fiscal 1994. Fuel volume sold increased 11% and the
resulting revenue increased 10.8%.
Cost of sales, as a percentage of sales, decreased 2.2%, and departmental costs
decreased $118 due to a reduction in salaries and benefits.
Administrative costs have been reduced by 28.5% ($201). The major reductions
are legal fees ($85), directors' and auditors' fees ($64), and travel and
entertainment ($40).
Interest expense has increased by $195 due to higher rates.
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
(DOLLAR AMOUNTS IN THOUSANDS)
LIQUIDITY AND CAPITAL RESOURCES
Working capital deficiency at March 31, 1995 increased by $716 to ($1,290) from
September 30, 1994. Current assets decreased $1,672 primarily as a result of
reductions in cash of $967, accounts receivable of $605, inventories of $382,
and an increase in notes receivable - affiliate of $280. Current liabilities
decreased $956 as a result of reductions in accounts payable of $733; other
liabilities of $496; and current maturities of long-term debt of $154. These
decreases were reduced by an increase in other liabilities - affiliate of $427.
During the six months ended March 31, 1995, the major source of cash was
provided by decreases in accounts receivable of $605, from the sale of FBOs of
$973, from a reduction on inventory of $382, and from an increase in other
liabilities - affiliate of $427. These funds were used primarily to reduce
accounts payable by $733, notes payable by $409, other current liabilities by
$496; to invest $280 in notes receivable; and to fund the cash portion of the
operating loss of $795.
In addition to the purchase of Mountain State Flight Services, Inc. (See Notes
5 and 7), the Company is negotiating for the purchase of two additional FBOs.
The Company has also filed with the Federal Aviation Agency an application for
a charter certificate (FAR PART 135), and estimates that operational consent
should be forthcoming within 90 days. Management has also considered other
non-aviation related opportunities in its attempt to make the company
profitable.
Management understands that the continued existence of the Company depends upon
achieving, as a minimum, positive cash flow . However, there is no guarantee
of success. Management believes that the Company can continue operations
through October 1, 1995 in its present financial condition, but cannot continue
to fund losses indefinitely.
PART II - OTHER INFORMATION
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
(DOLLAR AMOUNTS IN THOUSANDS)
ITEM 1. - LEGAL PROCEEDINGS
The Company is subject to several complaints filed over the last several years
in different courts or administrative agencies by different individual former
employees challenging the termination of their employment by the Company on a
variety of grounds. These claims are encountered in the ordinary course of
business, and in the opinion of management, the resolution of these matters,
either individually or in the aggregate, will not have a material adverse
effect on the Company's financial position in excess of what has already been
recorded. Management believes that it has established adequate reserves for
all of these claims. Management also believes it has strong defenses and
intends to vigorously defend its position.
In October 1992, Mary Ann Durette filed an action, individually and as
executrix, in North Carolina Superior Court, Wake County, against the Company,
Hess Aviation, Inc., Donald Weinhold and others seeking compensatory damages
in no specified amount resulting from a fatal aircraft accident which occurred
in December 1991. The co-defendants are Weinhold, the pilot of the aircraft
and a related company, and Hess, the company which performed an annual
inspection on the aircraft in November 1991. The pilot had brought the
aircraft to the Company for service after an incident in the spring of 1991.
The Company removed one engine and propeller, sent them respectively to Triad
Aviation, Inc. and H & H Propeller Services for repair, and thereafter
reinstalled them on the aircraft. The Company has filed third party claims
against both Triad and H & H for contribution and indemnity in the event of
liability. The Company believes it has strong defenses to this claim, and
intends to vigorously defend its position. The matter is being handled through
the Company's liability insurance carrier. Based on all information available
to date, the Company believes that any amounts for which it may ultimately be
determined to be liable will be covered beyond modest deductibility limits by
its liability insurance policies. Management believes that the insurance
companies involved are viable.
On March 9, 1995, the company received a letter from a law firm in Tucson,
Arizona notifying the Company of the intent of Don't Waste Arizona Inc. to file
a civil action against the company for alleged violations of certain inventory
filing requirements contained in the Emergency Planning and Community Right to
Know Act of 1986. To date, the Company is unaware of any such suit having been
commenced. However, should such a suit be brought, the Company intends to
vigorously contest the action.
The Company is also exposed to a number of asserted and unasserted potential
claims encountered in the normal course of business. In the opinion of
management, the resolution of these matters, as well as those discussed above
or referenced elsewhere in this report, will not have a material adverse effect
on the Company's financial position in excess of what has already been
recorded. Management believes that it has established adequate reserves for
all of these claims.
PART II - OTHER INFORMATION
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
(DOLLAR AMOUNTS IN THOUSANDS)
ITEM 6. - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
11.1 Computation of per Share Income/Loss.
27.0 Financial Data Schedule
(b) Reports on Form 8-K:
On February 10, 1995 a Form 8-K was filed reporting the sale of the
Company's assets located at the Youngstown, Ohio Airport for $ 632.
Included in the filing were a pro forma balance sheet at September 30,
1994, and pro forma income statements for the year ended
September 30, 1994 and the three months ended December 31, 1994.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
EXHIBIT 11.1 - COMPUTATION OF PER SHARE LOSS
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Three Months Ended
March 31, 1995
PRIMARY FULLY DILUTED
Average Common Shares outstanding 6,998,052 N/A
Assumed exercise of Common Stock Options -
Assumed conversion of Series A Cumulative
Convertible Preferred Stock -
Total 6,998,052
Net Loss $ (644) N/A
Less:
Dividends on Series A Cumulative
Convertible Preferred Stock 65
Accretion of Series A Cumulative
Convertible Preferred Stock 11
$ (720)
Net Loss per Common Equivalent Share $ (0.10) N/A
Note (1)
The series A cumulative convertible preferred stock is not considered common
stock equivalent in the computation of primary loss per share because, at the
time of issuance, the effective yield was greater than two thirds of the then
current average A corporate bond yield.
Note (2)
The effect of the assumed exercise of the common stock options is antidilutive.
Fully diluted loss per share is antidilutive and therefore not presented.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
EXHIBIT 11.1 - COMPUTATION OF PER SHARE INCOME
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Three Months Ended
March 31, 1994
PRIMARY FULLY DILUTED
Average Common Shares outstanding 5,498,052 5,498,052
Assumed exercise of Common Stock Options - 433,334
Assumed conversion of Series A Cumulative
Convertible Preferred Stock - 1,076,740
Assumed conversion of Series B Cumulative
Convertible Preferred Stock - 1,500,000
Total 5,498,052 8,508,126
Net Income $ 599 $ 599
Less:
Dividends on Series A Cumulative
Convertible Preferred Stock 65 -
Dividends on Series B Cumulative
Convertible Preferred Stock 90 -
Accretion of Series A Cumulative
Convertible Preferred Stock 11 -
$ 433 $ 599
Net Income per Common Equivalent Share $ 0.08 $ 0.07
Note (1)
The series A and series B cumulative convertible preferred stock are not
considered common stock equivalents in the computation of primary loss per share
because, at the time of issuance, the effective yield was greater than two
thirds of the then current average A corporate bond yield.
Note (2)
The effect of the assumed exercise of the common stock options is antidilutive.
Fully diluted loss per share is antidilutive and therefore not presented.
AERO SERVICES INTERNATIONAL, INC. AND SUBSIDIARIES
EXHIBIT 11.1 - COMPUTATION OF PER SHARE LOSS
(UNAUDITED: DOLLAR AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Six Months Ended
Mar. 31, 1995 Mar. 31, 1994
Primary loss per common and common
equivalent share
Average common shares outstanding 6,998,052 5,498,052
Net Loss $ (824) $ (361)
Less:
Dividends on Series A Cumulative
Convertible Preferred Stock 129 309
Accretion of Series A Cumulative
Convertible Preferred Stock 23 22
$ (976) (692)
Net Loss per Common and common
equivalent share $ (0.14) $ (0.13)
Note (1)
The series A and series B cumulative convertible preferred stock are not
considered common stock equivalents in the computation of primary loss per
share because, at the time of issuance, the effective yield was greater than
two thirds of the then current average A corporate bond yield.
Note (2)
All of the Series B cumulative convertible preferred stock was converted to
common stock on May 20, 1994.
Note (3)
The effect of the assumed exercise of the common stock options is antidilutive.
Fully diluted loss per share is antidilutive and therefore not presented.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AERO SERVICES INTERNATIONAL, INC.
(Registrant)
____________________________________
(Signature)
Paul R. Slack
Chief Accounting Officer
and Controller
_____________________________________
(Signature)
R. Ted Brant
Chairman of the Board
Date: May 11, 1995
See Notes to Condensed Consolidated Financial Statements.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-END> MAR-31-1995
<CASH> 1,439
<SECURITIES> 0
<RECEIVABLES> 609
<ALLOWANCES> 0
<INVENTORY> 72
<CURRENT-ASSETS> 2,813
<PP&E> 2,181
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,144
<CURRENT-LIABILITIES> 4,103
<BONDS> 0
<COMMON> 8,550
5,540
0
<OTHER-SE> (32,240)
<TOTAL-LIABILITY-AND-EQUITY> 5,144
<SALES> 6,001
<TOTAL-REVENUES> 6,001
<CGS> 3,084
<TOTAL-COSTS> 3,084
<OTHER-EXPENSES> 2,814
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 848
<INCOME-PRETAX> (824)
<INCOME-TAX> 0
<INCOME-CONTINUING> (824)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (824)
<EPS-PRIMARY> (.14)
<EPS-DILUTED> 0
</TABLE>
