Taylor Devices Inc. (TAYD, Financial) filed Annual Report for the period ended 2010-05-31.
Taylor Devices Inc. has a market cap of $16.3 million; its shares were traded at around $5.04 with a P/E ratio of 10.9 and P/S ratio of 0.9. TAYD is in the portfolios of Jim Simons of Renaissance Technologies LLC.
The Company leases a separate warehouse for storage from an unrelated third party, consisting of approximately 3,600 square feet at $975 per month. The warehouse is located approximately one-quarter mile from the above-referenced production facilities and office space. The total rental expense incurred by the Company for this facility in fiscal 2010 was $11,700. The Company also leases a separate facility for painting, packaging and shipping from an unrelated third party, consisting of approximately 10,000 square feet at $4,200 per month. The facility is located approximately four miles from the above-referenced production facilities and office space. The total rental expense incurred by the Company for this facility in fiscal 2010 was $50,400.
The Company recorded $42,000 expense during the year for real property taxes. This represents a combined tax rate of $35.79 per $1,000 of assessed valuation
The Agreement provides that, notwithstanding that each Trust member, including the Company, is statutorily and contractually liable on a joint and several basis for the full amount of the Board's calculated amount of the Trust's cumulative deficit as of November 30, 2008 (the "Deficit"), by entering into the Agreement, the Board has agreed to accept a stated amount as full payment and satisfaction of each settling member's portion of the Deficit. For the Company, the settling portion is an amount equal to 115% of the Company's pro rata allocation for the Deficit ("Adjusted Pro Rata Allocation" or "APRA"),i.e., an amount equal to $136,420, subject to a 10% discount for payments made within 30 days. The Company timely paid $122,778, reflecting the full payment of the APRA subject to the 10% discount. The Board has delivered a full and complete release of its claims against the Company and is seeking to discontinue the lawsuit against the Company. Reciprocally, the Company has agreed to release the Board and its agents from all liability, reserving all rights, however, against the former administrator and trustees of the Trust.
During the year ended May 31, 2010, the Company purchased 21 shares of its common stock for a total of $63 ($3.00 per share) under an offer to purchase for cash all shares of common stock from holders of fewer than 100 shares.
Realization of the deferred tax assets is dependent on generating sufficient taxable income at the time temporary differences become deductible. The Company provides a valuation allowance to the extent that deferred tax assets may not be realized. A valuation allowance has not been recorded against the deferred tax assets since management believes it is more likely than not that the deferred tax assets are recoverable. The Company considers future taxable income and potential tax planning strategies in assessing the need for a potential valuation allowance. In future years the Company will need to generate approximately $2.5 million of taxable income in order to realize our deferred tax assets recorded as of May 31, 2010 of $834,000. This deferred tax asset balance is only 5% ($48,000) lower than at the end of the prior year. The amount of the deferred tax assets considered realizable however, could be reduced in the near term if estimates of future taxable income are reduced. If actual results differ from estimated results or if the Company adjusts these assumptions, the Company may need to adjust its deferred tax assets or liabilities, which could impact its effective tax rate. Historically, actual results have not varied materially from the Company's estimates.
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Taylor Devices Inc. has a market cap of $16.3 million; its shares were traded at around $5.04 with a P/E ratio of 10.9 and P/S ratio of 0.9. TAYD is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
The Company does not generally engage in major product research and development activities in connection with the design of its products, except when funded by aerospace customers or the federal government. The Company, however, engages in research testing of its products. For the fiscal years ended May 31, 2010 and 2009, the Company expended $169,000 and $146,000, respectively, on manufacturing research. For the years ended May 31, 2010 and 2009, defense sponsored research and development totaled $26,000 and $30,000, respectively.The Company leases a separate warehouse for storage from an unrelated third party, consisting of approximately 3,600 square feet at $975 per month. The warehouse is located approximately one-quarter mile from the above-referenced production facilities and office space. The total rental expense incurred by the Company for this facility in fiscal 2010 was $11,700. The Company also leases a separate facility for painting, packaging and shipping from an unrelated third party, consisting of approximately 10,000 square feet at $4,200 per month. The facility is located approximately four miles from the above-referenced production facilities and office space. The total rental expense incurred by the Company for this facility in fiscal 2010 was $50,400.
The Company recorded $42,000 expense during the year for real property taxes. This represents a combined tax rate of $35.79 per $1,000 of assessed valuation
The Agreement provides that, notwithstanding that each Trust member, including the Company, is statutorily and contractually liable on a joint and several basis for the full amount of the Board's calculated amount of the Trust's cumulative deficit as of November 30, 2008 (the "Deficit"), by entering into the Agreement, the Board has agreed to accept a stated amount as full payment and satisfaction of each settling member's portion of the Deficit. For the Company, the settling portion is an amount equal to 115% of the Company's pro rata allocation for the Deficit ("Adjusted Pro Rata Allocation" or "APRA"),i.e., an amount equal to $136,420, subject to a 10% discount for payments made within 30 days. The Company timely paid $122,778, reflecting the full payment of the APRA subject to the 10% discount. The Board has delivered a full and complete release of its claims against the Company and is seeking to discontinue the lawsuit against the Company. Reciprocally, the Company has agreed to release the Board and its agents from all liability, reserving all rights, however, against the former administrator and trustees of the Trust.
During the year ended May 31, 2010, the Company purchased 21 shares of its common stock for a total of $63 ($3.00 per share) under an offer to purchase for cash all shares of common stock from holders of fewer than 100 shares.
Realization of the deferred tax assets is dependent on generating sufficient taxable income at the time temporary differences become deductible. The Company provides a valuation allowance to the extent that deferred tax assets may not be realized. A valuation allowance has not been recorded against the deferred tax assets since management believes it is more likely than not that the deferred tax assets are recoverable. The Company considers future taxable income and potential tax planning strategies in assessing the need for a potential valuation allowance. In future years the Company will need to generate approximately $2.5 million of taxable income in order to realize our deferred tax assets recorded as of May 31, 2010 of $834,000. This deferred tax asset balance is only 5% ($48,000) lower than at the end of the prior year. The amount of the deferred tax assets considered realizable however, could be reduced in the near term if estimates of future taxable income are reduced. If actual results differ from estimated results or if the Company adjusts these assumptions, the Company may need to adjust its deferred tax assets or liabilities, which could impact its effective tax rate. Historically, actual results have not varied materially from the Company's estimates.
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