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Positive Progress For Riviera
GRAND RAPIDS — When Riviera Tool Co. released its second-quarter financial report, it wasn’t exactly good news, but it was better than some other bad news recently circulating about the manufacturer of metal stamping equipment.
The company’s performance has been suffering. Most recently, the American Stock Exchange, where shares of the public company are traded, threatened to de-list the company for failing to meet its ongoing standards. Specifically, the level of shareholder equity was far below the minimum required by AMEX.
In its most recent quarterly report, however, Riviera announced that it had struck a deal with the exchange, allowing it more time to whip itself back into shape.
“We are pleased that the AMEX has confidence in our plan of compliance and has granted us an extension until August of 2007,” said Kenneth Rieth, president and CEO of Riviera.
The company’s quarterly performance showed improvement over the first quarter of its fiscal year. In the second quarter, which ended Feb. 27, sales increased by 38 percent, up to $6.9 million. The company also boasted higher backlogs, thanks to increased contract sales. Profitability, however, was nonexistent.
Riviera lost $134,804 during the period. That compares favorably to a loss of $427,836 for the same period a year earlier. The company also reported positive net operating income, another change from the previous year’s results. That is due in part to a whopping 31 percent decrease in selling, general and administrative expense. In the second quarter of 2005, that expense was just under $870,000 on $5 million in sales. In the second quarter of this year, those expenses were below $600,000, despite sales that increased to nearly $7 million.
“Our continuing efforts in reducing operating expenses had a positive impact on operating margins during the past quarter, and should have a positive impact in the future as well,” said Rieth. “We have managed to lower selling and administrative expenses from 15.2 percent of sales for the first six months of 2005 to 8.9 percent for the same period in 2006. We remain extremely focused on increasing revenue and lowering costs to produce a foundation for sustainable long-term profitability.”