T.J.T., Inc. Reports 3 Percent Higher Sales in First Quarter
12 February 1999
T.J.T., Inc. Reports 3 Percent Higher Sales in First Quarter
EMMETT, Idaho--Feb. 12, 1999--T.J.T., Inc.(Nasdaq SmallCap:AXLE), a supplier of refurbished axles and tires to the manufactured housing industry, today reported net sales of $8.2 million in the first quarter ended December 31, 1998, representing a 3 percent increase over the same quarter a year ago.The increase is a result of the company's continued expansion of its customer base through its 11-state market area.
Gross profit decreased $90,000 to $1.4 million for the quarter from $1.5 million in the first quarter of fiscal 1998, resulting in a lower gross margin of 17.5 percent compared to 19.1 percent. Operating income was $94,000 compared to $213,000 a year ago. The decline of gross profit was a result of higher costs of procurement of used axles to meet increased volume demands and continued declining valuation of seven-inch tires which accounted for $58,000 of the gross profit decline.
Net income for the quarter was $49,000, an $84,000 decrease from net income of $133,000 in the same period last year. Earnings per share were $0.01 in the quarter compared to $0.03 for the same quarter last year.
"We continue to focus on opening up new sources of used axles with our recent acquisition of Ford's Tires and Axles which was finalized on January 11," said Terrence Sheldon, president and chief executive officer of T.J.T. "We are disappointed with the performance of our Colorado location which continues to be a drag on company profitability. The experienced management team that we gained through the Ford acquisition will help manage through the difficulties at the Colorado site."
"The company is well positioned in the marketplace and the sales are there," Sheldon added. "Our focus for the remainder of the year will be on improving profitability."
This release may contain certain forward-looking statements, which are based on management's current expectations. Factors that could cause future results to vary materially from these expectations include, but are not limited to, general economic conditions; changes in interest rates, deposit flows, real estate values and competition; changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, governmental, regulatory and technological factors affecting the company's operations, pricing, products and services.
Established in 1977, T.J.T. is a major provider of recycled axles and inspected tires to the manufactured housing industry. In addition to effectively recycling these serviceable steel and rubber products, the company also sells aftermarket accessories to the manufactured housing industry and vinyl siding to the housing industry. T.J.T. has 10 consecutive years of profitability while growing with the expanding manufactured housing industry. For its fiscal year ended September 30, 1998, the company had revenue of $34.1 million.
T.J.T., INC.
STATEMENTS OF INCOME(unaudited)
(Dollars in thousands except per share amounts)
For the three months ended December 31, 1998 1997
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Sales (net of returns and allowances):
Axles and tires $ 6,198 $ 6,198
Accessories and siding 2,101 1,895
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Total sales 8,299 8,093
Cost of goods sold 6,844 6,548
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Gross profit 1,455 1,545
Selling,general, and administrative
expenses 1,361 1,332
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Operating income 94 213
Interest income 11 20
Income on investment property 4 1
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Income before taxes 109 234
Income taxes 60 101
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Net income $ 49 $ 133
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Net income per common share $ .01 $ .03
Weighted average shares outstanding 4,843,832 4,846,420
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T.J.T., INC.
BALANCE SHEETS(unaudited)
(Dollars in thousands)
Dec. 31 Sept. 30
1998 1998
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Current assets:
Cash and cash equivalents $ - $ 204
Accounts receivable, notes
receivable (net of allowance
for doubtful accounts of $50
and $38) 1,805 2,111
Inventories 3,980 3,774
Prepaid expenses and other current
assets 656 517
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Total current assets 6,441 6,606
Property, plant and equipment, net of
accumulated depreciation 2,005 1,944
Notes receivable 311 348
Real estate held for investment 594 390
Deferred charges and other assets 305 326
Goodwill 1,413 1,440
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Total assets $ 11,069 $ 11,054
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Current liabilities:
Line of credit $ 237 $ -
Accounts payable 783 1,117
Accrued liabilities 789 809
Income taxes payable 64 3
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Total current liabilities 1,873 1,929
Deferred credits and other noncurrent
obligations 158 136
Deferred income taxes 60 60
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Total liabilities 2,091 2,125
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Shareholders' equity:
Common stock, $.001 par value;
10,000,000 shares authorized;
4,854,739 shares issued and
outstanding 5 5
Common stock warrants 113 113
Capital surplus 6,068 6,068
Retained Earnings 3,230 3,181
Treasury stock(10,907 shares at cost) (44) (44)
Stock subscriptions receivable (394) (394)
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Total shareholders' equity 8,978 8,929
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Total liabilities and
shareholders' equity $ 11,069 $ 11,054
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