T.J.T., Inc. 2005 Net Income & EPS up 166% Over 2004
EMMETT, Idaho--Dec. 1, 20053, 2005--T.J.T., Inc. (the Company), (Pink Sheets:AXLE) today reported increased sales and substantially higher income for the second consecutive year.Sales in fiscal year 2005 increased 15 percent to $22.6 million compared to $19.7 million in 2004. Axle and tire sales increased 17 percent while accessories and siding sales increased seven percent. Increased sales, combined with a one percent increase in axle and tire gross margin contributed to the $709,000 increase in gross profit in 2005 as compared with 2004.
The Company's net income was $661,000 for the year ended September 30, 2005, or $.15 per basic and fully diluted share, compared to $397,000 or $.09 per basic and fully diluted share in fiscal year 2004. Joint venture income of $453,000 recognized in 2005, compared to $224,000 in 2004, along with increased axle and tire sales, contributed to the 66 percent increase in net income. Selling, general and administrative expenses increased $489,000 due to higher wages and commissions for additional sales personnel, incentive-based compensation, and costs incurred for product development.
Sales increased six percent in the fourth quarter of 2005 as compared to the same period a year ago. Gross profit, during the final quarter of fiscal 2005, improved 25 percent on higher sales, compared to the same period a year ago. Gross margin rose to 29 percent compared to 25 percent in the same year-ago period. Selling, general and administrative expense increased $115,000 as a result of higher incentive compensation expense than in the same quarter of 2004. Net income increased to $309,000 or $.07 per basic and fully diluted share, compared to $.04 in the same 2004 period.
"I am very pleased with the sales performance this year," said Terrence Sheldon, President and Chief Executive Officer of T.J.T. "We had increases in all of our markets, while experiencing little, if any, sales impact from the Gulf Coast hurricanes." Mr. Sheldon went on to say, "We had excellent execution of price adjustments to cover rapidly rising costs, we were able to maintain our gross margins for the year, and expect our strong market position will enable us to maintain these margins going forward."
Established in 1977, T.J.T., Inc. is a major provider of recycled axles and tires to the manufactured housing industry. It operates recycling facilities in Idaho, Washington, California, and Colorado, and serves 13 western states. In addition to the recycling business, T.J.T. also sells aftermarket products to manufactured housing, recreational vehicle, and residential markets.
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, competition, and changes in legislation or regulations, and other economic, competitive, governmental, regulatory, and technological factors affecting the company's operations, pricing, products, and services. Any forward-looking statement speaks only as of the date on which the statement is made, and the Company undertakes no obligation to update any forward-looking statement.
Copies of this report and additional financial information can be found a www.pinksheets.com or www.tjt-inc.com.
T.J.T., INC.
BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
At September 30, 2005 2004
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Current assets:
Cash and cash equivalents $1,551 $843
Accounts receivable (net of allowances and
discounts of $100 and $23) 1,425 1,349
Current portion of notes receivable 44 105
Inventories 3,072 2,847
Prepaid expenses and other current assets 19 202
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Total current assets 6,111 5,346
Property, plant and equipment, net of
accumulated depreciation 758 728
Notes receivable, net of current portion 298 338
Real estate held for investment 221 224
Investment in joint venture 969 676
Other assets 243 212
Deferred tax asset - 179
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Total assets $8,600 $7,703
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Current liabilities:
Accounts payable $671 $556
Accrued liabilities 712 640
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Total current liabilities 1,383 1,196
Deferred income and other noncurrent obligations 54 57
Deferred tax liability 48 -
------- -------
Total liabilities 1,485 1,253
Shareholders' equity:
Preferred stock, $.001 par value; 5,000,000
shares authorized; 0 shares issued and
outstanding - -
Common stock, $.001 par value; 10,000,000
shares authorized; 4,504,939 shares issued
and outstanding 5 5
Capital surplus 5,795 5,791
Retained earnings 1,315 654
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Total shareholders' equity 7,115 6,450
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Total liabilities and shareholders' equity $8,600 $7,703
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T.J.T., INC.
STATEMENTS OF OPERATION
(Dollars in thousands except per-share amounts)
(Unaudited)
Three Months Ended Year Ended
September 30, September 30,
--------------------- ---------------------
2005 2004 2005 2004
---------- ---------- ---------- ----------
Sales (net of returns and
allowances):
Axles and tires $4,492 $4,056 $17,034 $14,502
Accessories and siding 1,615 1,701 5,541 5,199
---------- ---------- ---------- ----------
Total sales 6,107 5,757 22,575 19,701
Cost of goods sold
Axles and tires 3,176 3,195 13,134 11,312
Accessories and siding 1,160 1,150 3,912 3,569
---------- ---------- ---------- ----------
Total cost of goods
sold 4,336 4,345 17,046 14,881
---------- ---------- ---------- ----------
Gross profit 1,771 1,412 5,529 4,820
Selling, general and
administrative expenses 1,458 1,343 5,158 4,669
---------- ---------- ---------- ----------
Operating income 313 69 371 151
Interest income 33 10 74 58
Investment property income 7 133 7 170
Undistributed equity interest
in joint venture income 156 63 453 224
Rental income 6 8 23 49
Other income 4 8 170 21
---------- ---------- ---------- ----------
Income before taxes 519 291 1,098 673
Income taxes 210 123 437 276
---------- ---------- ---------- ----------
Net income $309 $168 $661 $397
========== ========== ========== ==========
Net income per common share
Basic $ .07 $ .04 $ .15 $ .09
Diluted $ .07 $ .04 $ .15 $ .09
Weighted average shares
outstanding 4,504,939 4,504,939 4,504,939 4,504,939
========== ========== ========== ==========
T.J.T., INC.
STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
For the year ended September 30, 2005 2004
------- ------
Cash flows from operating activities:
Net income (loss) $ 661 $ 397
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation and amortization 166 170
Gain on sale of assets (170) (21)
Gain on sale of investment property - (170)
Equity earnings in joint venture (453) (224)
Stock compensation 4 3
Change in receivables (76) (18)
Change in inventory (368) (281)
Change in prepaid expenses and other current
assets 183 (95)
Change in accounts payable 115 (308)
Change in taxes 227 271
Change in other assets and liabilities 35 58
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Net cash provided (used) by operating
activities 324 (218)
Cash flows from investing activities:
Additions to property, plant and equipment (231) (304)
Repayments on notes receivable 308 188
Issuance of notes receivable (13) (59)
Proceeds from sale of assets 160 23
Distributions from joint venture 160
Land purchased for investment - (17)
Sale of land purchased for investment - 158
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Net cash provided (used) by investing activities 384 (11)
Net increase in cash and cash equivalents 708 (229)
Cash and cash equivalents at October 1 843 1,072
------- ------
Cash and cash equivalents at September 30 $1,551 $ 843
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Supplemental information:
Interest paid $ - $ 1
Income taxes paid, net of refunds 180 -
Noncash transactions:
Sale of land by issuance of note receivable $ - $ 35
Sale of hanger inventory by issuance of note
receivable 143 -
Sale of fixed assets by issuance of note
receivable 51 -
Gain recognized on fair market value of asset
trade-in 10 -
Deferred gain offset against outstanding note
receivable upon payoff - 18