Exhibit 99.1
For more information, contact: | | |
Larry B. Prescott | | Dolores Chenoweth |
Senior Vice President and Chief Financial Officer | | in-ves.com |
T.J.T., Inc. | | (503) 469-0338 |
(208) 365-5321 | | |
T.J.T, INC. EARNINGS PER SHARE UP 400 PERCENT
IN FOURTH QUARTER
EMMETT, IDAHO - -DECEMBER 3, 2003 - T.J.T., Inc. (OTCBB:AXLE:BB), a recycler of axles and tires and wholesale distributor of O.E.M. parts and aftermarket material to the manufactured housing industry, today reported significantly improved profitability for the fourth quarter and year ended September 30, 2003.
Sales in the quarter were $5.1 million, down 7 percent from $5.5 million in the same year ago period, attributable primarily to the closure of the company’s Phoenix, Arizona location in June 2003. Lower cost of goods and decreased selling, general and administrative expenses fueled the stronger results. Gross profit rose nearly 3 percent in the fourth quarter of 2003 while expenses dropped 10 percent reflecting, in part, reduced costs from closure of the Arizona operation. Net income for the quarter was $204,000, or $0.05 per share, compared to $39,000, or $0.01 per share, in 2002.
“At our ongoing locations, sales in the fourth quarter actually increased 6 percent,” said Terrence Sheldon, president and chief executive officer of T.J.T. “The manufactured housing market remains sluggish but we continue to gain more market share.”
For the fiscal year ended September 30, 2003, sales of $19.7 million were off slightly from $20.4 million in the 2002 period. The $658,000 decline resulted from the closing of the Arizona operation in June 2003. Higher gross profit and lower selling, general and administrative expenses boosted net income to $132,000, or $0.03 per share, compared to a loss of $139,000, or ($0.03) per share, before the cumulative effect of an accounting change in the 2002 fiscal year. In 2002, implementation of SFAS 142 “Goodwill and Other Intangible Assets” resulted in a $748,000 write down of goodwill net of taxes , increasing the loss for a year ago to $887,000, or $(0.20) per share.
“We ended the fiscal year with a stronger balance sheet than a year ago,” noted Sheldon. “Cash and cash equivalents are up 40 percent over the same time last year and the company has no long term debt.”
Established in 1977, T.J.T 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 and Colorado 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.
BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
| | Sept. 30
2003 | | Sept. 30,
2002 | |
| | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ | 1,072 | | $ | 767 | |
Accounts receivable and notes receivable (net of allowances for doubtful accounts of $68 and $129) | | 1,374 | | 1,247 | |
Inventories | | 2,566 | | 2,593 | |
Prepaid expenses and other current assets | | 107 | | 99 | |
Total current assets | | 5,119 | | 4,706 | |
| | | | | |
Property, plant and equipment, net of accumulated depreciation | | 594 | | 699 | |
| | | | | |
Notes receivable | | 323 | | 232 | |
Notes receivable from related parties | | 89 | | 156 | |
Real estate held for investment | | 341 | | 523 | |
Investment in joint venture | | 452 | | — | |
Deferred tax asset | | 450 | | 539 | |
Other assets | | 174 | | 135 | |
Total assets | | $ | 7,542 | | $ | 6,990 | |
| | | | | |
Current liabilities: | | | | | |
Accounts payable | | $ | 864 | | $ | 655 | |
Accrued liabilities | | 549 | | 334 | |
Total current liabilities | | 1,413 | | 989 | |
| | | | | |
Deferred credits and other noncurrent obligations | | 79 | | 83 | |
Total liabilities | | 1,492 | | 1,072 | |
| | | | | |
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 | | 5,788 | | 6,181 | |
Retained earnings | | 257 | | 125 | |
Treasury stock (349,800 shares at cost) | | — | | (393 | ) |
Total shareholders’ equity | | 6,050 | | 5,918 | |
Total liabilities and shareholders’ equity | | $ | 7,542 | | $ | 6,990 | |
T.J.T., INC.
STATEMENTS OF OPERATION
(Dollars in thousands except per share amounts)
(Unaudited)
| | Three Months Ended
September 30, | | Year Ended
September 30, | |
| | 2003 | | 2002 | | 2003 | | 2002 | |
| | | | | | | | | |
Sales (net of returns and allowances): | | | | | | | | | |
Axles and tires | | $ | 3,810 | | $ | 4,200 | | $ | 15,215 | | $ | 15,594 | |
Accessories and siding | | 1,302 | | 1,308 | | 4,513 | | 4,792 | |
Total sales | | 5,112 | | 5,508 | | 19,728 | | 20,386 | |
| | | | | | | | | |
Cost of goods sold | | | | | | | | | |
Axles and tires | | 2,920 | | 3,398 | | 12,332 | | 12,690 | |
Accessories and siding | | 930 | | 908 | | 3,149 | | 3,382 | |
Cost of goods sold | | 3,850 | | 4,306 | | 15,481 | | 16,072 | |
| | | | | | | | | |
Gross profit | | 1,262 | | 1,202 | | 4,247 | | 4,314 | |
| | | | | | | | | |
Selling, general and administrative expenses | | 1,061 | | 1,173 | | 4,259 | | 4,709 | |
| | | | | | | | | |
Operating income (loss) | | 201 | | 29 | | (12 | ) | (395 | ) |
| | | | | | | | | |
Interest income | | 14 | | 8 | | 51 | | 43 | |
Investment property income (expense) | | 40 | | 32 | | 68 | | 116 | |
Income from joint venture | | 51 | | — | | 63 | | — | |
Rental income | | 20 | | 4 | | 34 | | 12 | |
Other income (expense) | | 7 | | (5 | ) | 24 | | 18 | |
| | | | | | | | | |
Income (loss) before taxes | | 333 | | 68 | | 228 | | (206 | ) |
| | | | | | | | | |
Income taxes (benefit) | | 129 | | 30 | | 96 | | (67 | ) |
| | | | | | | | | |
Income (loss) before cumulative effect of accounting change | | 204 | | 38 | | 132 | | (139 | ) |
| | | | | | | | | |
Cumulative effect of accounting change, net of income taxes | | — | | — | | — | | (748 | ) |
| | | | | | | | | |
Net income (loss) | | $ | 204 | | $ | 38 | | $ | 132 | | $ | (887 | ) |
| | | | | | | | | |
Net income (loss) per common share | | | | | | | | | |
Continuing operations | | $ | .05 | | $ | .01 | | $ | .03 | | $ | (.03 | ) |
Cumulative effect of accounting change | | — | | — | | — | | (0.17 | ) |
| | | | | | | | | |
Net income (loss) | | $ | .05 | | $ | .01 | | $ | .03 | | $ | (.20 | ) |
| | | | | | | | | |
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)
For the year ended September 30, | | 2003 | | 2002 | |
| | | | | |
Cash flows from operating activities: | | | | | |
Net income (loss) | | $ | 132 | | $ | (887 | ) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | | | | | |
Depreciation and amortization | | 226 | | 362 | |
Cumulative effect of accounting change | | — | | 748 | |
(Gain) loss on sale of assets | | (94 | ) | (107 | ) |
Equity earnings in joint venture | | (63 | ) | — | |
Change in receivables | | (116 | ) | 246 | |
Change in inventory | | (232 | ) | 86 | |
Change in prepaid expenses and other current assets | | (8 | ) | (19 | ) |
Change in accounts payable | | 209 | | (104 | ) |
Change in taxes | | 146 | | 19 | |
Change in other assets and liabilities | | 106 | | (60 | ) |
Net cash provided/used by operating activities | | 306 | | 284 | |
| | | | | |
Cash flows from investing activities: | | | | | |
Additions to property, plant and equipment | | (124 | ) | (73 | ) |
Issuance of notes receivable | | — | | — | |
Payments on notes receivable | | 89 | | 110 | |
Proceeds from sale of assets | | 28 | | 25 | |
Investment in joint venture | | (130 | ) | — | |
Land purchased for investment | | (17 | ) | (28 | ) |
Sale of land purchased for investment | | 153 | | 120 | |
Net cash provided/used by investing activities | | (1 | ) | 154 | |
| | | | | |
Cash flows from financing activities: | | | | | |
Treasury stock transactions | | — | | — | |
Net proceeds(payments) from debt | | — | | — | |
Net cash provided/used by financing activities | | — | | — | |
| | | | | |
Net increase/(decrease) in cash and cash equivalents | | 305 | | 438 | |
Cash and cash equivalents at October 1 | | 767 | | 329 | |
| | | | | |
Cash and cash equivalents at September 30 | | $ | 1,072 | | $ | 767 | |
| | | | | |
Supplemental information: | | | | | |
Interest paid | | $ | 1 | | $ | 2 | |
Income tax refunds/(payments) | | — | | 34 | |
| | | | | |
Noncash transactions: | | | | | |
Sale of land by issuance of note receivable | | $ | 120 | | $ | 74 | |
Cumulative effect of accounting change | | — | | 748 | |
Prepaid operating lease | | — | | 4 | |
Reaquisition of investment property by cancellation of note receivable | | — | | 40 | |
Inventory invested in joint venture | | 259 | | — | |
