Supreme Industries, Inc. (NYSE Amex: STS) announced that net sales for the third quarter rose 26% to $62.8 million from $49.8 million in last year's comparable period. For the first nine months, net sales reached $171.9 million, up 18% from $146 million in 2009.
Moving into the year's second half, Supreme continued to experience improved demand for all major product lines including truck, bus and armored vehicles. Sales order backlog at Sept. 25 grew 44% to $89 million from $62 million a year ago.
Compared with last year's third quarter, sales in Supreme's core dry-freight truck and armored vehicle divisions advanced 33% and 109%, respectively. The company's bus division posted a 4% sales increase versus the prior-year period. Net sales also improved in each of Supreme's primary product lines during the first nine months of 2010, with dry-freight trucks, buses and armored vehicles reporting gains of 18%, 16% and 31%, respectively.
The third-quarter loss from continuing operations was $0.1 million, or $0.01 per share, compared with the $1.3 million loss, or $0.09 per share, reported for the year-ago quarter. For the first nine months of 2010, the net loss from continuing operations was $2.6 million, or $0.18 per share, compared with the net loss of $3.4 million, or $0.23 per share, in 2009's comparable period. The company did not record an income tax benefit for the three and nine months ended Sept. 25 due to having fully utilized its loss carryback benefits in 2009.
"As anticipated, we experienced firmer demand across all of our major product categories,” said President and Chief Operating Officer Robert W. Wilson. “Order activity continued to ramp up compared with last year as evidenced by our higher backlog and increased activity from fleet customers. We already have a large fleet order on the books for spring 2011. However, we will continue to maintain a conservative and cautious view of our markets as we move forward."
Third-quarter gross profit increased 39% to $5.7 million from $4.1 million last year. Gross profit margin as a percentage of net sales improved to 9.1% for the 2010 third quarter and 8.8% for the nine months, compared with 8.2% in the third quarter and 7.4% in the first nine months of 2009. The year-over-year gross margin increases for both periods were primarily the result of higher unit volumes and benefits from implemented cost reductions.
"We previously indicated that historically low order rates from fleet operators over the past few years have resulted in pent-up demand,” Wilson said. “We are starting to see fleet operators return to the market and recently have been bidding on and winning some large fleet awards. We are hopeful that this trend for our core dry-freight truck business will continue into 2011."