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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
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DATE OF REPORT: APRIL 16, 1998
DATE OF EARLIEST EVENT REPORTED: APRIL 16, 1998
GULFSTREAM AEROSPACE CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 1-8461 13-3554834
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification
incorporation or Number)
organization)
P.O. BOX 2206
500 GULFSTREAM ROAD
SAVANNAH, GEORGIA 31402-2206
(Address of principal executive
offices)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (912) 965-3000
Item 5. Other Events.
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On April 16, 1998, the registrant issued the press release filed as
Exhibit 99.2 hereto.
Item 7. Financial Statements and Exhibits.
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Exhibit Description
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99.1 Cautionary Statement for Purposes of the
Safe Harbor Provisions of the Private
Securities Reform Act of 1995 (FN*)
99.2 Press Release issued April 16, 1998
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* Incorporated by reference to Exhibit 99.1 to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on behalf of the
undersigned hereunto duly authorized.
Dated: April 16, 1998.
GULFSTREAM AEROSPACE CORPORATION
By: /s/ Chris A. Davis
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Chris A. Davis
Executive Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit Description
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99.1 Cautionary Statement for Purposes of the
Safe Harbor Provisions of the Private
Securities Reform Act of 1995*
99.2 Press Release issued April 16, 1998
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* Incorporated by reference to Exhibit 99.1 to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1997.
FOR IMMEDIATE RELEASE
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Contact: Tricia Bergeron
Vice President Corporate
Communications and Investor
Relations
(912) 965-3700
GULFSTREAM REPORTS RECORD 1ST QUARTER 1998 RESULTS;
25 AIRCRAFT ORDERED THROUGH MARCH 31
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SAVANNAH, GA, APRIL 16, 1998 -- Gulfstream Aerospace Corporation (NYSE:
GAC) today reported revenues of $503.4 million for the first quarter ended
March 31, 1998, up 34% from revenues of $375.6 million in the 1997 first
quarter. Net income for the 1998 quarter was $40.5 million, up 54% from
comparable pro forma fully taxed net income of $26.3 million in the 1997
first quarter. Diluted earnings per share for the 1998 first quarter were
$0.54, up 64% from comparable pro forma fully taxed diluted earnings per
share of $0.33 in the 1997 first quarter.
Gulfstream delivered 13 aircraft, six Gulfstream IV-SPs and seven
Gulfstream Vs, in the 1998 first quarter, compared to 11 aircraft (five
GIV-SPs and six GVs) in the 1997 first quarter.
In the 1998 first quarter, Gulfstream signed contracts for 25 aircraft
and added 13 of these orders to firm contract backlog, which at March 31,
1998 totaled 88 aircraft representing $2.8 billion in future revenues. The
other 12 contracts in the 1998 first quarter, with a total value of
approximately $335 million, are for the Middle East shares program and have
not yet been included in backlog.
In the 1998 first quarter, gross margin (excluding pre-owned aircraft
which generally are sold at break-even levels) was 22.1% of revenues, up from
20.0% of revenues in the 1997 first quarter. As Gulfstream continues to
realize increased manufacturing efficiencies, gross margin is expected to
continue to improve.
"This was another exceptional quarter in terms of financial
performance, and by far the best first quarter Gulfstream has ever had in new
sign-ups, with 25 aircraft ordered through March," said Chairman Theodore J.
Forstmann. "Gulfstream now has a total of 100 aircraft under contract, and
we are seeing continuing strong demand for both GIVs and GVs on a global
basis. We are co-producing GIVs and GVs with increasing efficiency, and the
Company is now well ahead of its target to increase annual production to 60
planes by 1999."
Founded in 1958, Gulfstream Aerospace is the leading designer,
developer, manufacturer and marketer of the world's most technologically
advanced intercontinental business jet aircraft. Gulfstream has produced
more than 1,000 aircraft for customers around the world. The Company offers
a range of aircraft products and services to meet the aviation needs of its
customers, including the Gulfstream IV-SP, the ultra-long range Gulfstream V,
Gulfstream Shares(R) (fractional ownership interests), Gulfstream Financial
Services, pre-owned Gulfstream aircraft, and Gulfstream Charter Services.
Note To Editors -- See Financial Table Attached
This press release includes forward-looking statements which are subject to
risks and uncertainties. Actual results might differ materially from those
projected in the forward-looking statements. Additional information
concerning factors that could cause actual results to materially differ from
those in the forward-looking statements is contained in the Company's
Securities and Exchange Commission filings.
# # #
GULFSTREAM AEROSPACE CORPORATION
($ in millions, except per share data)
CONDENSED STATEMENT OF INCOME INFORMATION
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QUARTER ENDED
MARCH 31,
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1998 1997
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(Unaudited)
Net revenues $ 503.4 $ 375.6
Gross profit 99.3 70.5
Income from operations 69.2 47.0
Net income (FN1) 40.5 40.0
Earnings per share: (FN2)
Net income per share - basic .56 .54
Net income per share - diluted .54 .51
Pro forma information:
Net income (FN3) $ 40.5 $ 26.3
Fully taxed net income per share - diluted (FN3) .54 .33
Aircraft orders 13 21
Aircraft contracted - not in Contractual Backlog (FN4) 12 --
Aircraft deliveries (in units):
Green - GIV-SP 6 5
Green - GV 7 6
Completion 7 5
Pre-owned aircraft 3 1
Contractual Backlog - Units 88 104
- Dollars (in billions) (FN4) $ 2.8 $ 3.3
CONDENSED BALANCE SHEET INFORMATION
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MARCH 31, DECEMBER 31,
1998 1997
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Cash and cash equivalents $ 183.2 $ 306.5
Inventories 708.5 629.9
Total current assets 1,060.0 1,158.7
Customer deposits 557.4 634.5
Long-term debt 361.3 380.0
Total stockholders' equity (FN5) 69.0 92.8
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(1) In the quarter ended March 31, 1998, the Company recorded an
income tax provision of $24.8 million based on an estimated
effective tax rate of 37.5% compared to only a $2 million
provision for alternative minimum taxes in the first quarter of
1997. Prior to September 30, 1997, the Company recorded no
provision for income taxes, other than alternative minimum taxes,
principally as a result of utilization of net operating loss
carryforwards. As a result of numerous factors, including, but
not limited to the Company's recent earnings trends and the size
of its contractual backlog, the Company determined that its net
deferred tax asset was more likely than not to be realized, and,
in the quarter ending September 30, 1997, released its deferred
tax valuation allowance, totaling $94.2 million. Of this amount,
$29.4 million related to the exercise of stock options and was
credited to additional paid-in capital and $64.8 million was
recorded as a one-time, non-cash income tax benefit.
(2) Basic earnings per share ("EPS") is computed based on net income
divided by the weighted average common shares outstanding.
Diluted EPS is computed by dividing net income by the weighted
average common shares outstanding plus the incremental shares
that would have been outstanding under stock option plans.
(3) Pro forma net income and fully taxed net income per share is
presented for the 1997 period assuming an estimated effective tax
rate of 37.5%. As discussed above, in the quarter ended March 31,
1998, the Company recorded an income tax provision based on an
estimated effective tax rate of 37.5%.
(4) During the quarter ended March 31, 1998, the Company also signed
a contract for 12 Gulfstream IV-SPs to expand its highly
successful Gulfstream Shares fractional ownership program into
the Middle East region. This contract, valued at approximately
$335 million, is not included in units ordered or in backlog.
(5) During January 1998, the Company announced the repurchase of up
to $200 million of its common stock. The repurchase will be
funded from the Company's available cash. As of March 31, 1998,
the Company had repurchased 2.5 million shares, at an average
price of $30.01 per share, for an aggregate amount of $74.6
million.
