| Avteam, Inc. | |||
| Ticker: | AVTM | 3230 Executive Way | |
| Exchange: | NASDAQ-National Market | Miramar, FL 33025 | |
| Industry: | Wholesale (SIC Code 5088) | (954) 431-2359 | |
| Type of Shares: | Class A Common Shares | Filing Date: | 3/24/97 | |
| U.S. Shares: | 4,500,000 | Offer Date: | 10/30/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $10.00 - $12.00 | |
| Primary Shares: | 3,033,000 | Offer Price: | $8.50 | |
| Secondary Shares: | 1,467,000 | Gross Spread: | $0.60 | |
| Offering Amount: | $49,500,000 | Selling: | $0.36 | |
| Expenses: | $750,000 | Reallowance: | $0.10 | |
| Shares Out After: | 9,733,000 |
| Manager | Tier | Phone |
| CS First Boston | Lead Manager | (212) 325-2000 |
| SBC Warburg Dillon Read, Inc. | Co-manager |
| Issuer's Law Firm: | Baker & McKenzie |
| Bank's Law Firm: | King & Spalding |
| Auditor: | Ernst & Young |
Dollar amounts in U.S. millions except for per share data | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 12/31/96 | ||||
| Revenue: | $34.05 | Assets: | $22.30 | ||
| Net Income: | $2.15 | Curr Assets: | |||
| EPS: | $0.38 | Liabilities: | $7.21 | ||
| Prior EPS: | $0.14 | Curr Liabilities: | |||
| Cash Flow/Oper: | -$6.10 | Equity: | $15.10 | ||
| Cash Flow/Fin: | Cash: | ||||
| Cash Flow/Inv: | |||||
| Business Description |
| The company is a international aftermarket supplier of JT8D aircraft engines manufactured by Pratt & Whitney, a unit of United Technologies and engine components as well as airframes and other material to commercial passenger and cargo aircraft operators. The JT8D is the most widely used aircraft engine in the world and is estimated to power approximately 40% of the world's commercial jet powered aircraft. First tier aircraft operators have reduced the percentage of their fleets which is powered by the JT8D engine by selling older aircraft to second tier, start-up and cargo aircraft operators and replacing them with new aircraft. As a result, a substantial number of JT8D engines have migrated to aircraft operators which the Company believes are more likely to outsource their maintenance and inventory management requirements. During 1995, the Company supplied over 500 customers with over 40,000 aircraft engine and airframe components and 22 aircraft engines. The Company has increased net sales at a compound annual growth rate of 117% from $3.9 million in 1993 to $18.3 million in 1995. The Company currently estimates that it has less than a 2% share of the worldwide JT8D aircraft engine and engine component aftermarket. |
| Competition |
| The aftermarket aviation supply industry is highly fragmented with a small number of well known companies generating substantial revenues from the supply of aftermarket aviation material and a large number of small suppliers selling less than a total of %5 million each in engine components per year. Management believes that the primary competitive factors in the aftermarket aviation supply business are product quality and traceability, overall customer service, availability of product, delivery time, quality of customer relationships, name recognition and price. |
| Business Plan |
| The Company seeks to maximize revenues and profitability through a combination of appropriate purchases of surplus aircraft engines and superior customer support to compete more on product offerings and relatively less on price. Elements of the Company's growth strategy include: 1) Increase JT8D market penetration. 2) Enter CFM56 market. 3) Implement engine management and leasing programs. 4) Strengthen key customer relationships. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to repay bank debt; repay advances and to pay an S Corporation distribution to current stockholders, acquire engine component inventory, including purchases of engines, components and other materials. |