May 08--After suffering significant 2013 losses that spilled over into the first quarter of this year, St. Charles, Mo.-based LMI Aerospace has restructured its Savannah operation, shuttering the highly touted machining center it opened a little more than 18 months ago.
LMI's net sales in the first quarter were $95.8 million, compared to $106.1 million in the first quarter of 2013. For the full year 2013, LMI reported a loss of $58.5 million compared with a profit of $16.5 million in 2012.
It wasn't immediately known whether employees had been laid off or plant operations downsized locally. Repeated calls to LMI Chief Financial Officer Cliff Stebe, who took part in the morning conference call, and Savannah plant manager Mary Hall were not returned.
In a conference call with analysts Wednesday, new LMI CEO Dan Korte said the company would offer no guidance while focusing on key issues critical for success.
"In my first eight weeks as CEO, I have toured each facility at LMI and have met with key customers and suppliers," Korte said. "I am excited about the opportunities I see, the capabilities we offer and our ability to grow profitably in this marketplace. As we continue through 2014, we will be refining our strategy and organizing our team around its execution.
The company needs to integrate its aerostructures business and cut costs to stay competitive, Korte said.
"We have already executed plans that are expected to remove over $4 million in annual costs, and we have set a near-term goal for an additional annual savings of $6 million," he said.
"The closure of our Fort Worth, Texas, plant and elimination of the machining center in Savannah are now substantially complete, and we continue to drive efforts toward centers of excellence."
LMI's Savannah plant, located on Coleman Boulevard, provides structural components, assemblies and kits to such aerospace giants as Gulfstream and Boeing. Since it opened in 2003, the local enterprise has grown from 28,000 square feet to nearly 112,000 square feet.
The Savannah facility began with Gulfstream Aerospace, developing and supplying fuselage skin kit assemblies that worked well with the business jet builder's lean, just-in-time manufacturing process.
Later the company added Aviation Partners Boeing as a client, producing a kit that supports the installation of winglets on the Boeing 737, 757 and 767 models.
In May of 2011, the Georgia Department of Economic Development named LMI Savannah the Georgia Manufacturer of the Year for 2010 in the category of small manufacturer with 150 or fewer employees. In February of 2012, the facility was named Supplier of the Year for 2011 by Aviation Partners Boeing and, in December of 2012, was named 2012 Manufacturer of the Year by the Savannah Morning News.
The world-class, $3.2 million machining center used the latest in leading edge machining technology to offer the high-speed machining of aircraft aluminum to its complement of services supporting both Gulfstream and Boeing.
A Gulfstream spokeswoman said it was not known what -- if any -- impact the change would have on that company's supply chain.
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