Air T Inc 8-K, filed Aug 11, 2020
Air T Inc (AIRT)
8-K
2020-08-11
For: 2020-08-11
View Original
Added on
April 09, 2026
About this 8-K
Air T Inc filed this 8-K on August 11, 2020.
Items reported
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): August 12, 2020
Air T, Inc.
(Exact Name of Registrant as Specified in Charter)
| Delaware | 001-35476 | 52-1206400 | |||||||||||||||||||||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | |||||||||||||||||||||
5930 Balsom Ridge Road
Denver, North Carolina 28037
(Address of Principal Executive Offices, and Zip Code)
________________(828) 464-8741__________________
Registrant’s Telephone Number, Including Area Code
Not applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||||
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||||
¨ | Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||||
¨ | Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
| Common Stock | AIRT | NASDAQ Global Market | ||||||
| Alpha Income Preferred Securities (also referred to as 8% Cumulative Capital Securities) (“AIP”) | AIRTP | NASDAQ Global Market | ||||||
| Warrant to purchase AIP | AIRTW | NASDAQ Global Market | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
| Item 7.01. | Regulation FD Disclosure | ||||
Commencing August 12, 2020, management of Air T, Inc. (the “Company”) intends to make presentations to potential investor groups. A copy of the PowerPoint Presentation to be used by the Company for such presentations is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. | ||||
(d) Exhibits.
The following exhibit shall be deemed furnished and not filed as a part of this Current Report on Form 8-K.
| Exhibit No. | Description | |||||||
| 99.1 | PowerPoint Presentation dated August 12, 2020. | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: August 12, 2020 | AIR T, INC. | ||||||||||||||||
| By: | /s/ Nick Swenson | ||||||||||||||||
| Name: | Nick Swenson | ||||||||||||||||
| Title: | Chief Executive Officer | ||||||||||||||||
AUGUST 2020 A PORTFOLIO OF POWERFUL COMPANIES SHAREHOLDERS MEETING UPDATE NASDAQ: AIRT
Statements made today that should be considered in conjunction with the cautionary statements contained in the company’s recent SEC filings. Forward-looking statements are subject to the various risks and uncertainties that could cause Air T’s actual results to differ materially from these statements. Air T assumes no obligation to update any of these forward-looking statements or information. Please see our filings with the SEC including our last annual report on Form 10-K for a discussion of specific risks that may affect our performance and financial condition. FORWARD-LOOKING STATEMENTS 2
WHO WE ARE ■ AIR T, INC. (NASDAQ: AIRT) is an industrious American company focused on generating after tax cash flow per share. ■ Founded in 1980, our businesses have a history of growth and cash flow generation. EXECUTIVE ■ Current management has been in place since 2013. The first and second largest shareholders have seats on the Board of Directors. SUMMARY OPERATING HIGHLIGHTS ■ AIR T, INC. operates 10 companies with 400+ employees. ■ In the six full years current management has operated the business, Revenues and Operating Income have increased 19% and 7% per annum, respectively. ■ For fiscal year end 2020, Revenues were $236.8 million and Operating Income was $7.3 million. ■ Since 9/30/13, shares outstanding have declined from 3.7m* to 2.9m or 22.7%. 3 *Adjusted for 3/2 stock split
1. About AIR T, INC. 2. FY20 Performance CONTENTS 3. Our Growth Factors 4. Appendix - Risk Factors 4
ABOUT AIR T, INC. 5
We are an industrious American company established 40 years and growing. ■ Our businesses have a history of growth and cash flow generation. ■ We seek to identify and empower individuals and teams who will operate businesses well, increasing value over time. ■ We work to activate growth and overcome challenges, ultimately building businesses that flourish over the long-term. ■ Management has purchased a significant % of AIRT common stock in the open market, demonstrating real alignment with all common shareholders. ■ AIRT’s management team has a track record of successfully allocating capital. 6
“Investor-Operator Partnership” is designed to drive short and long-term value creation. “We want our businesses to be managed by dynamic individuals within high-performance teams. We are set up to make space for dynamos and support their enterprises. The holding company team seeks to focus resources, activate growth and deliver long-term value for everyone associated with AIR T, INC.” - Nick NICK SWENSON CHAIRMAN & CEO 7
FY20 Results AIR T, INC. FY20 Results FY20 FY19 % Revenue $236.8M $215.5M +9.9% Operating $7.3M $9.3M (21.9%) Income ■ FY20 saw revenue growth across all 3 major segments with the strongest growth seen in our Ground Equipment segment. ■ FY20 operating income was down $2.0M vs. FY19 driven by lower profitability in our Commercial Jet Engines and Air Cargo segment, offset by strong growth in our Ground Equipment segment. 8
$237M $7.3M 3 10 400+ FY20 REVENUE FY20 OPERATING INCOME CORE SEGMENTS COMPANIES EMPLOYEES COMMERCIAL AIRCRAFT & ENGINES AVIATION GROUND SUPPORT OVERNIGHT AIR CARGO EQUIPMENT 9
SEGMENT 1 Commercial Aircraft & Engines ■ We buy aircraft and engines, then either lease, trade, or send them to part out. ■ We supply parts to maintenance, repair and overhaul facilities (MRO). ■ Companies in this segment include Contrail Aviation Support, JetYard, AirCo, and Worthington Aviation. Revenue, FY20 $104.6M Revenue, FY19 $100.1M Operating Income*, FY20 $8.0M Operating Income*, FY19 $11.6M *Operating income excludes intercompany eliminations A niche between aircraft owners and MRO shops, this segment will seek to grow by coordinating activities and raising investment capital. 10
SEGMENT 2 Overnight Air Cargo ■ We operate two of the seven FedEx feeder airlines. ■ Business units Mountain Air Cargo and CSA Air have a 39 year history with FedEx. Revenue, FY20 $75.3M Revenue, FY19 $73.0M Operating Income*, FY20 $0.7M Operating Income*, FY19 $1.9M Air T Companies Since 1982, 1983 *Operating income excludes intercompany eliminations An asset-light, predictable business. 11
SEGMENT 3 Aviation Ground Support Equipment ■ We manufacture deicing equipment, scissor lift trucks and other ground support equipment. ■ Sole-source deicer supplier to the US Air Force for 18 years. ■ Highly efficient light manufacturing facility. ■ The segment is comprised of Global Ground Support LLC. Revenue, FY20 $59.2M Revenue, FY19 $47.2M Operating Income*, FY20 $7.3M Operating Income*, FY19 $3.4M Air T Company Since 1998 *Operating income excludes intercompany eliminations Segment’s order backlog was $51.5 million as of 3/31/20 compared to $26.1 million 3/31/19 12
COVID-19 UPDATE ■ Each of our business segments have been impacted by COVID- 19 and have seen significant revenue declines in April and May of 2020 versus last year: ✓ Commercial Jet Engines and Parts down 67% ✓ Overnight Air Cargo down 14% ✓ Ground Equipment Sales down 26% NEWS ■ While we cannot predict when or how the commercial aviation industry will recover from the impacts of COVID-19, we have taken several steps to preserve liquidity and to protect each business segment in order to capitalize on opportunities that will emerge as the economy and the aviation industry recovers. ■ For example, in April 2020 we secured a Paycheck Protection Program $8.2m loan under the CARES Act. The purpose of this loan is to maintain employee salaries through the economic disruption caused by COVID-19. This loan has a 1% interest rate, up to a 5-year maturity, and has the possibility of being forgiven upon application with the Treasury Department. 13
FINANCIAL HIGHLIGHTS Over the last six years, revenue has increased 181% and is more diversified. $236M* REVENUE 44% +181% SEGMENTS Commercial Aircraft & Engines Overnight Air Cargo $84M 34% Ground Support Equipment 62% 22% 38% FY14 FY20 *Excludes revenue in FY20 earned outside of our core segments. 14
OTHER Non-Operating Assets AIR T, INC.’s balance sheet includes $10.0 million of public and private securities, as of 3/31/20. AIR T, INC. Non-Operating Assets (In Millions) 3/31/20 Insignia Systems (ISIG) Stock – 3.5M Shares* $2.6 Oxbridge RE (OXBR) Stock – 0.5M Shares* $0.4 CCI Investment $3.4 Investments in BCCM Funds $0.3 TFS Partners LLC Investment $0.5 Other Investments $2.8 Total $10.0 *Based on closing price at 3/31/20 15
CAPITALIZATION TABLE AIR T, INC. DIRECT & GUARANTEED Interest Rate Maturity Date 3/31/2020 Revolver Prime - 1% 8/31/2021 $ - Term Loans 1mo LIBOR + 2%, 4.50% 1/1/2028 11.6 Corporate Headquarters Real Estate 1mo LIBOR + 2% 1/1/2028 1.5 AIR T, INC.’s capital Supplemental Revolver Greater of 1mo LIBOR +1.25% and 3% 6/30/2020 9.6 structure is designed to Contrail Guarantee 1.6 appropriately shape our Total Direct & Guaranteed $ 24.3 bet sizes; in part by Trust Preferred 8% 6/7/2049 12.9 utilizing non-recourse leverage NON- AIR T, INC. GUARANTEED Contrail Revolver 1mo LIBOR + 3% 9/5/2021 21.3 For example, AIR T Term 1mo LIBOR + 3.75% varies, 2021 21.0 guarantees Contrail’s Less Air T, Inc. Guarantee (1.6) Total Contrail 40.6 bank loans to a AirCo I Greater of 6.5% of Prime + 2% 8/31/2021 8.3 maximum limit of $1.6 Total Non-Air T, Inc. Guaranteed $ 49.0 million. Less: Unamortized Debt Issuance Costs (0.4) Total Debt & Preferreds 85.8 Cash & Restricted Cash (15.6) Net Debt $ 70.2 16
FINANCIAL HIGHLIGHTS Since 9/30/2013, the share price of AIRT has increased at 9.3% per annum*. *Reporting period 9/30/13 to 7/28/20, includes $4M Trust Preferred dividend to common shareholders 17
100 150 200 250 50 - FINANCIALHIGHLIGHTS 1994 1995 1996 1997 1998 1999 Revenue ($inMillions) Since 1994,our companyhas hada historyof 2000 2001 2002 long 2003 2004 2005 2006 - 2007 term and sustained financial health. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 10 (4) (2) - 2 4 6 8 tied to our investment investment TechnologiesourDelphax in to tied largenon containedFY2017Note: 1994 1995 1996 1997 Operating Income ($ in Millions) 1998 1999 2000 2001 2002 2003 2004 - cash impairments impairments inventoryandwrite cash 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 - 2017 downs 2018 2019 18 2020
GROWTH STRATEGIES 19
GROWTH STRATEGIES Our four growth strategies are... ■ Invest to build our current high-performing businesses. ■ Seek to acquire new cash-flow generating businesses. ■ Identify great marketable securities or alternative assets. ■ Create unique investment products and fund alongside third- party capital partnerships. 20
GROWTH STRATEGY 1 We plan to reinvest in projects at our high-performing businesses by... ■ Purchasing commercial aircraft for trading, leasing and part-out. ■ Purchasing engine parts inventory. ■ Funding deicer builds for Global Ground Support. 21
GROWTH STRATEGY 2 We seek to acquire new cash-flow generating businesses by... ■ Identifying and acquiring high- performing businesses with edge in the marketplace, which either complement our current portfolio or diversify into industries beyond aviation. 22
GROWTH STRATEGY 3 We plan to identify great marketable securities or alternative assets by... ■ Searching for another committed activist opportunity. ■ Investing in distressed and high yield securities. ■ Investing in small cap securities. ■ Further investing in our current securities portfolio. 23
GROWTH STRATEGY 4 We plan to create unique investment products with outside capital partners by... ■ Offering thoughtful and sustainable products with attractive return profiles ■ Attracting and retaining sophisticated investment professionals and creating space for talented asset managers. 24