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Shiloh Industries Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: February 22, 2011 05:24PM
Shiloh Industries Inc. (SHLO) filed Quarterly Report for the period ended 2011-01-31. Shiloh Industries Inc. has a market cap of $201.17 million; its shares were traded at around $12.14 with a P/E ratio of 28.23 and P/S ratio of 0.44.
Highlight of Business Operations:
Additionally, the Company reviews specific large insurance claims to determine whether there is a need for additional accrual on a case-by-case basis. Changes in the claim lag periods and the specific occurrences could materially impact the required accrual balance period-to-period. The Company carries excess insurance coverage for group insurance and workers compensation claims exceeding a range of $160-170 and $100-500 per plan year, respectively, dependent upon the location where the claim is incurred. At January 31, 2011 and 2010, the amount accrued for group insurance and workers compensation claims was $2,273 and $2,247, respectively. The insurance reserves established accruals are a result of improved safety statistics, changes in employment levels, reduced number of open and active workers compensation cases, and group insurance plan design features. The Company does not self-insure for any other types of losses.
GROSS PROFIT. Gross profit for the first quarter of fiscal 2011 was $6,345 compared to gross profit of $5,031 in the first quarter of fiscal 2010, an increase of $1,314. Gross profit as a percentage of sales was 5.8% in the first quarter of fiscal 2011 and 5.1% in the first quarter of fiscal 2010. Gross profit in the first quarter of fiscal 2011 was favorably impacted by the increased sales volume of approximately $2,380. Gross profit was also favorably impacted by approximately $580, resulting from increased revenue realized from the sale of engineered scrap net of an increase in material costs during the first quarter of fiscal 2011 compared to the first quarter of fiscal 2010. Manufacturing expenses also rose as a result of the increased production activity experienced in the first quarter of fiscal 2011 of approximately $1,646 more than the manufacturing expenses incurred in the first quarter of 2010. Personnel and personnel related expenses, including the restoration of certain benefits, like the 401k Company match, were responsible for the growth of these expenses as the Companys workforce was increased as a result of the improved production volumes.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and administrative expenses of $5,086 in the first quarter of fiscal 2011 were $488 more than selling, general and administrative expenses of $4,598 in the same period of the prior year. As a percentage of sales, these expenses were 4.7% of sales in both the first quarter of fiscal 2011 and the first quarter of fiscal 2010. The increase in selling, general and administrative expenses reflects higher personnel and personnel related expenses of approximately $548 as result of the restoration of certain benefits, like the 401k Company match, and lower spending of approximately $60 in other controllable expense areas.
NET INCOME. The net income for the first quarter of fiscal 2011 was $507, or $0.03 per share, diluted. Net loss for the first quarter of fiscal 2010 was $535, or $0.03 per share, diluted.
In June 2004, the Company issued a $2,000 promissory note to the State of Ohio related to specific machinery and equipment at one of the Companys Ohio facilities. The promissory note bears interest at 1% for the first year of the term and 3% per annum for the balance of the term, with interest only payments for the first year of the term. Principal payments began in August 2005 in the amount of $25, and monthly principal payments continue increasing annually thereafter until July 2011, when the loan matures. The Company may prepay this promissory note without penalty. The balance due the State of Ohio at January 31, 2011 and October 31, 2010 was $181 and $270, respectively.
Working capital changes since October 31, 2010 generated funds of $3,149. During the first three months of fiscal 2011, accounts receivable have decreased by $10,468 and inventory increased by $1,531 since the end of fiscal 2010. Considering the decrease in overdraft balances of $1,047, accounts payable, net have decreased $6,629.
Stocks Discussed: SHLO,