ARMSTRONG, Iowa, July 11, 2018 /PRNewswire/ -- Art's Way
Manufacturing Co., Inc. (NASDAQ: ARTW), a diversified,
international manufacturer and distributor of equipment serving
agricultural, research and steel cutting needs, announces its
financial results for the second quarter and year to date of fiscal
2018.
In conjunction with the release, the Company has scheduled a
conference call for Thursday, July 12,
2018 at 10:00 AM CT.
Marc H. McConnell, Chairman of the
Board of Directors of Art's Way Manufacturing, and Carrie Gunnerson, President, Chief Executive
Officer and Interim Chief Financial Officer will be leading the
call to discuss the second quarter and year to date fiscal 2018
financial results.
What: Art's Way Manufacturing, Inc. Second Quarter and
Year to Date Fiscal 2018 Financial Results.
When: Thursday, July 12,
2018 10:00 AM CT.
How: Live via phone by dialing (877) 358-7309. Code:
Art's Way Manufacturing. Participants to the conference call should
call in at least 5 minutes prior to the start time. A replay
of the call will be archived on the Company's website for 12
months. www.artsway-mfg.com/
|
For the Three
Months Ended
|
(Continuing
Operations, Consolidated)
|
|
May 31,
2018
|
May 31,
2017
|
Sales
|
$
|
5,294,000
|
$
|
4,689,000
|
Operating
(Loss)
|
$
|
(458,000)
|
$
|
(721,000)
|
Net (Loss)
|
$
|
(654,000)
|
$
|
(509,000)
|
EPS
(Basic)
|
$
|
(0.16)
|
$
|
(0.12)
|
EPS
(Diluted)
|
$
|
(0.16)
|
$
|
(0.12)
|
|
|
|
|
|
Weighted Average
Shares Outstanding:
|
|
|
|
|
Basic
|
|
4,213,893
|
|
4,158,969
|
Diluted
|
|
4,213,893
|
|
4,158,969
|
|
For the Six Months
Ended
|
(Continuing
Operations, Consolidated)
|
|
May 31,
2018
|
May 31,
2017
|
Sales
|
$
|
10,660,000
|
$
|
9,111,000
|
Operating
(Loss)
|
$
|
(767,000)
|
$
|
(1,074,000)
|
Net (Loss)
|
$
|
(1,181,000)
|
$
|
(763,000)
|
EPS
(Basic)
|
$
|
(0.28)
|
$
|
(0.18)
|
EPS
(Diluted)
|
$
|
(0.28)
|
$
|
(0.18)
|
|
|
|
|
|
Weighted Average
Shares Outstanding:
|
|
|
|
|
Basic
|
|
4,192,592
|
|
4,142,672
|
Diluted
|
|
4,192,592
|
|
4,142,672
|
Sales: Our consolidated corporate sales for continuing
operations for the three- and six-month periods ended May 31, 2018 were $5,294,000 and $10,660,000 compared to $4,689,000 and $9,111,000 during the same respective periods in
fiscal 2017, a $605,000, or 12.9%,
increase for the three months and a $1,549,000, or 17.0%, increase for the six
months. The increases in revenue are primarily due to the increased
demand for our agricultural products and modular buildings.
Consolidated gross margin for the three-month period ended
May 31, 2018 was 20.9% compared to
17.3% for the same period in fiscal 2017. Consolidated gross
margin for the six-month period ended May
31, 2018 was 21.2% compared to 21.1% for the same period in
fiscal 2017. These increased gross margins are largely
attributable to the agricultural products segment as margins have
decreased in our modular building and tools segments.
Income (Loss) from Continuing Operations:
Consolidated net (loss) from continuing operations was $(654,000) for the three-month period and
$(1,181,000) for the six-month period
ended May 31, 2018 compared to net
(loss) of $(509,000) and $(763,000) for the same respective periods in
fiscal 2017. The increased loss from continuing operations
was largely due to the revaluing of our deferred tax asset at the
new income tax rates for the 2018 tax year, which was a loss of
approximately $(300,000), along with
the liquidation of our Canadian subsidiary. We recognized a
loss of approximately $(253,000) from
the liquidation of our Canadian subsidiary related to the
cumulative translation adjustment in the second quarter of fiscal
2018. These expenses were non-cash expenses and one-time
adjustments.
Earnings (Loss) per Share from Continuing Operations:
(Loss) per basic and diluted share from continuing operations for
the second quarter of fiscal 2018 was $(0.16), compared to (loss) per basic and diluted
share from continuing operations of $(0.12) for the same period in fiscal 2017.
(Loss) per basic and diluted share from continuing operations for
the six months ended May 31, 2018 was
$(0.28), compared to (loss) per basic
and diluted share from continuing operations of $(0.18) for the same period in fiscal
2017.
Chairman of the Art's Way Board of Directors, Marc H. McConnell reports, "As we have reported
over the last few quarters, we are beginning to see some positive
signs in the marketplace. We are pleased to report stronger
second quarter revenues than a year ago and greater success selling
non-strategic inventory than we've had at any point during this
agricultural market downturn. We observe that dealers have been
more willing to stock whole goods and feel that is a fair indicator
for the direction things are starting to go."
"Amid these improving conditions, we did incur significant
charges and expenses that negatively impacted our profitability for
the quarter, most significantly an accumulated loss on currency
translation of $253,000, prompted by
the closure of our Art's Way International entity. We have
been very active in reducing our non-strategic inventory by
building out material purchased years ago into whole goods,
liquidating whole goods at the expense of margins, and scrapping
material where necessary. These expenses, charges, and
low-margin sales are the short-term pain of making the proper
long-term decisions to simplify our business and position it for
success going forward."
"As we look at the second half of the fiscal year we find
ourselves in an ever-improving position but do have more
uncertainty than at any point in recent memory. Concerns over
tariffs have driven up material costs while simultaneously rattling
commodity markets that drive much of our business. Such
circumstances make future outcomes hard to predict but we know that
staying focused on quality, customer service, product development,
continuous improvement, and reducing our borrowings will serve our
company best in the long-term. We are making meaningful
strides in all of these areas and are building the foundation of
what we believe will be a sustainably profitable business in the
years ahead."
About Art's Way Manufacturing Co., Inc.
Art's Way manufactures and distributes farm machinery niche
products including animal feed processing equipment, sugar beet
defoliators and harvesters, land maintenance equipment, plows, hay
and forage equipment, manure spreaders, reels for combines and
swathers, and top and bottom drive augers, as well as modular
animal confinement buildings and laboratories, and specialty tools
and inserts. After-market service parts are also an important part
of Art's Way's business. Art's Way has three reporting segments:
agricultural products; modular buildings; and tools.
For more information, including an archived
version of the conference call, contact: Carrie Gunnerson, President, Chief Executive
Officer and Interim Chief Financial Officer
712-864-3131
investorrelations@artsway-mfg.com
Or visit the Company's website at
www.artsway-mfg.com/
Cautionary Statements
This news release includes "forward-looking statements" within
the meaning of the federal securities laws. Statements made in this
release that are not strictly statements of historical facts,
including our expectations regarding: (i) our business position;
(ii) future results; (iii) future operational changes; (iv) future
costs of materials; (v) the timing of increased performance; and
(vi) the benefits of our business model and strategy, are
forward-looking statements. Statements of anticipated future
results are based on current expectations and are subject to a
number of risks and uncertainties, including, but not limited to:
customer demand for our products; credit-worthiness of our
customers; our ability to operate at lower expense levels; our
ability to complete projects in a timely and efficient manner in
accordance with customer specifications; our ability to renew or
obtain financing on reasonable terms; our ability to repay current
debt, continue to meet debt obligations and comply with financial
covenants; domestic and international economic conditions,
including the impact of tariffs; factors affecting the strength of
the agricultural sector; the cost of raw materials; unexpected
changes to performance by our operating segments; obstacles related
to liquidation of product lines and segments; and other factors
detailed from time to time in our Securities and Exchange
Commission filings. Actual results may differ markedly from
management's expectations. We caution readers not to place undue
reliance upon any such forward-looking statements. We do not
intend to update forward-looking statements other than as required
by law.
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SOURCE Art's Way Manufacturing Co., Inc.