T.J.T., Inc. Reports Fourth Quarter Results
EMMETT, Idaho--Nov. 27, 2002--T.J.T., Inc. (OTCBB:AXLE), a recycler of axles and tires and wholesale distributor of O.E.M. parts and aftermarket material to the manufactured housing industry, today reported net income of $39,000, or $0.01 per share, for the fourth quarter ending Sept. 30, 2002.Sales in the quarter increased 2 percent to $5.8 million from $5.4 million in the same year ago period. Despite the slight sales gain, gross profit of $1.2 million declined $204,000, or 4 percent, from the 2001 fourth quarter, due to higher cost of raw axles and tires and lower overall selling prices as a result of increased competition. Net income for the quarter decreased from $153,000, or $0.03 per share, in the comparable year ago quarter.
"The manufactured housing markets remains sluggish and the result is continued price pressure from our competitive markets," said Terrence Sheldon, president and chief executive officer of TJT.
As an offset to the pressure on gross margins, the company reduced selling and general administrative expenses slightly in the fourth quarter, despite an increase of $58,000 to the allowance for doubtful accounts. The allowance was due, in part, to the recent chapter 11 bankruptcy filed by a major T.J.T. customer, Oakwood Homes.
"Oakwood Homes remains a major customer of TJT, Inc.," Sheldon pointed out. "We are continuing to sell axles and tires to Oakwood Homes and conducting business as usual."
For fiscal year ending Sept. 30, 2002, sales were $20.4 million, down 4 percent compared to $21.2 million in the prior year. Gross profit margin increased to 21 percent from 20 percent in the prior year.
Higher gross profit and lower selling and general administrative expenses combined to lower losses before the cumulative effect of an accounting change for the fiscal year ending Sept. 30, 2002. Losses before the accounting change were $139,000, or $0.03 per share, compared to a loss of $242,000,or $0.05 per share, in the previous year. For the year, losses totaled $887,000, or $0.20 per share with the write down of $748,000, or $0.17 per share, for goodwill, net of taxes, taken in the 2002 first quarter for implementation of SFAS 142 "Goodwill and Other Intangible Assets".
Established in 1977, TJT is a wholesale distributor of O.E.M. parts and aftermarket materials to the manufactured housing industry and the largest recycler and supplier of manufactured home axles and tires in the western United States. The company operates recycling facilities in Idaho, Washington, California, Colorado and Arizona and serves customers in eleven Western states.
This release contains certain forward-looking statements, which are based on management's current expectations including, but not limited to, general economic conditions, changes in interest rates, deposit flows, real estate values and competition changes in legislation or regulations, and other economic, competitive, governmental, regulatory and technological factors affecting the company's operations, pricing, products and services.
T.J.T., INC.
STATEMENTS OF OPERATION
(Dollars in thousands except per share amounts)
(Unaudited)
Three Months Ended Year Ended
September 30, September 30,
--------------------- ---------------------
2002 2001 2002 2001
---------- ---------- ---------- ----------
Sales (net of returns and
allowances):
Axles and tires $4,200 $3,938 $15,594 $15,277
Accessories and siding 1,308 1,448 4,792 5,942
---------- ---------- ---------- ----------
Total sales 5,508 5,386 20,386 21,219
Cost of goods sold
Axles and tires 3,398 2,985 12,690 12,707
Accessories and siding 908 995 3,382 4,232
---------- ---------- ---------- ----------
Cost of goods sold 4,306 3,980 16,072 16,939
---------- ---------- ---------- ----------
Gross profit 1,202 1,406 4,314 4,280
Selling, general and
administrative expenses 1,173 1,186 4,709 4,840
Impairment loss - - - -
---------- ---------- ---------- ----------
Operating income (loss) 29 220 (395) (560)
Interest income 9 17 45 73
Interest expense 1 3 2 88
Income on investment
property (expense) 36 13 128 223
Other income
(expense) (4) 4 18 15
---------- ---------- ---------- ----------
Income (loss) before
taxes 69 251 (206) (337)
Income taxes
(benefit) 30 98 (67) (95)
---------- ---------- ---------- ----------
Income (loss) before
cumulative effect of
accounting change 39 153 (139) (242)
Cumulative effect of
accounting change, net of
income taxes - - (748) -
Net income (loss) $39 $153 $(887) $(242)
========== ========== ========== ==========
Net income (loss) per
common share
Continuing
operations $.01 $.03 $(.03) $(.05)
Cumulative effect of
accounting change - - (0.17) -
---------- ---------- ---------- ----------
Net income (loss) $.01 $.03 $(.20) $(.05)
---------- ---------- ---------- ----------
Weighted average shares
outstanding 4,504,939 4,504,939 4,504,939 4,504,939
========== ========== ========== ==========
T.J.T., INC.
BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
Sept. 30 Sept. 30,
2002 2001
---------- ---------
Current assets:
Cash and cash equivalents $767 $329
Accounts receivable and notes receivable
(net of allowances for doubtful accounts
of $70 and $84) 1,305 1,501
Inventories 2,593 2,679
Prepaid expenses and other current assets 99 80
---------- ---------
Total current assets 4,764 4,589
Property, plant and equipment, net of
accumulated depreciation 699 952
Notes receivable 232 265
Notes receivable from related parties 156 186
Real estate held for investment 523 562
Deferred charges and other assets 135 145
Deferred tax asset 569 516
Goodwill - 790
---------- ---------
Total assets $7,078 $8,005
========== =========
Current liabilities:
Accounts payable $655 $759
Accrued liabilities 386 311
---------- ---------
Total current liabilities 1,041 1,070
Deferred credits and other noncurrent obligations 83 130
---------- ---------
Total liabilities 1,124 1,200
Shareholders' equity:
Common stock, $.001 par value; 10,000,000
shares authorized; 4,854,739 shares issued
and outstanding 5 5
Capital surplus 6,181 6,181
Retained earnings 161 1,012
Treasury stock (349,800 shares at cost) (393) (393)
---------- ---------
Total shareholders' equity 5,954 6,805
---------- ---------
Total liabilities and shareholders' equity $7,078 $8,005
========== =========
T.J.T., INC.
STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
For the year ended September 30, 2002 2001 2000
------- -------- --------
Cash flows from operating activities:
Net income (loss) $(887) $(242) $(1,720)
Adjustments to reconcile net income
(loss)
to net cash provided by operating
activities:
Depreciation and amortization 362 604 794
Impairment Loss 748 - 847
(Gain) loss on sale of assets (107) (225) (30)
Change in receivables 246 404 34
Change in inventory 86 1,137 205
Change in prepaid expenses and other
current assets (19) (37) 47
Change in accounts payable (104) 60 42
Change in taxes 19 200 (645)
Change in other assets and liabilities (60) (158) (104)
------- -------- --------
Net cash provided/used by operating
activities 284 1,743 (530)
------- -------- --------
Cash flows from investing activities:
Additions to property, plant and
equipment (73) (81) (94)
Issuance of notes receivable - - (10)
Payments on notes receivable 110 88 44
Proceeds from sale of assets 25 22 36
Land purchased for investment (28) (45) (439)
Sale of land purchased for investment 120 335 361
------- -------- --------
Net cash provided/used by investing
activities 154 319 (102)
------- -------- --------
Cash flows from financing activities:
Treasury stock transactions - - (71)
Net proceeds(payments) from debt - (1,787) 628
------- -------- --------
Net cash provided/used by financing
activities - (1,787) 557
------- -------- --------
Net increase/(decrease) in cash and cash
equivalents 438 275 (75)
Cash and cash equivalents at October 1 329 54 129
------- -------- --------
Cash and cash equivalents at September
30 $767 $329 $54
======= ======== ========
Supplemental information:
Interest paid $2 $88 $156
Income tax refunds/(payments) 34 296 114
Noncash transactions:
Sale of land by issuance of note
receivable $74 $34 $31
Impairment loss 748 - 847
Prepaid operating lease 4 - -
Reaquisition of investment property by
cancellation of note receivable 40 50 -