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American International Industries Inc Reports Operating Results (10-Q)

November 14, 2012 | About:
10qk

10qk

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American International Industries Inc (AMIN) filed Quarterly Report for the period ended 2012-09-30.

American International Industries Inc has a market cap of $2.3 million; its shares were traded at around $1.5 with and P/S ratio of 0.1.

Highlight of Business Operations:

Net revenues. Revenues from continuing operations were $3,121,692 for the three months ended September 30, 2012, compared to $4,405,063 for the three months ended September 30, 2011, representing a decrease of $1,283,371, or 29.1%. Revenues from continuing operations were $5,254,133 for the nine months ended September 30, 2012, compared to $8,426,403 for the nine months ended September 30, 2011, representing a decrease of $3,172,270, or 37.6%. NPI's revenues decreased by $1,299,878, or 29.5%, to $3,104,838 for the three months ended September 30, 2012, compared to $4,404,716 for the same period in the prior year. NPI's revenues decreased by $3,209,987, or 38.1%, to $5,215,398 for the nine months ended September 30, 2012, compared to $8,425,385 for the same period in the prior year. NPI's revenues decreased primarily because of lower revenues with one of its principal customers. NPI has added several new customers to replace this business and expects to add additional medium to large customers in the year 2012. For the three and nine months ended September 30, 2012 and September 30, 2011, Brenham's revenues were $127, $538, $347, and $1,018, respectively. For the three and nine months ended September 30, 2012, AITP's revenues were $16,727 and $38,197, respectively.

Cost of sales and margins. Cost of sales for the three months ended September 30, 2012 was $2,382,994, compared to $3,255,454 for the three months ended September 30, 2011. Cost of sales for the nine months ended September 30, 2012 was $3,883,293, compared to $6,180,467 for the nine months ended September 30, 2011. Our gross margins for the three and nine months ended September 30, 2012 were 23.7% and 26.1%, respectively, compared to gross margins for the three and nine months ended September 30, 2011 of 26.1% and 26.7%. The decrease in margins was primarily due to the product mix at NPI.

Net cash used in operating activities from continuing operations was $2,128,963 for the nine months ended September 30, 2012, compared to $2,885,068 for the nine months ended September 30, 2011. Net cash used in operating activities for the nine months ended September 30, 2012 was derived primarily from our net loss from continuing operations of $2,014,272 and an increase in accounts receivable of $1,350,249, offset by an increase in accounts payable of $1,123,637. The increases in accounts receivable and accounts payable are due to higher revenues at NPI during the three months ended September 30, 2012 as a result of the seasonality of NPIs revenues. Net cash used in operating activities for the nine months ended September 30, 2011 includes a one-time lump sum payment of $1,250,000 for a lawsuit settlement that was accrued as of December 31, 2010. Additionally, accounts payable decreased significantly due to payments made in the nine months ended September 30, 2011 for expenses incurred during the nine months ended December 31, 2010 in support of higher revenues at NPI.

Cash flow from operations. Net cash used in operating activities from continuing operations was $2,128,963 for the nine months ended September 30, 2012, compared to $2,885,068 for the nine months ended September 30, 2011. Net cash used in operating activities for the nine months ended September 30, 2012 was derived from our net loss from continuing operations of $2,014,272, which included non-cash expenses of $122,911, including depreciation and amortization of $61,806, share-based compensation of $42,600, and amortization of guarantor fee of $18,505. Our net income from continuing operations of $396,934 for the nine months ended September 30, 2011 included non-cash expenses of $1,344,993, including depreciation and amortization of $48,334, share-based compensation of $1,284,627, and amortization of guarantor fee of $12,032. Our net loss from continuing operations for the nine months ended September 30, 2012 included a loss on the sale of assets of $272,002, compared to a gain of $3,476,824 for the nine months ended September 30, 2011. Accounts receivable increased by $1,350,249 during the nine months ended September 30, 2012, compared to $1,030,974 during the same period in 2011. Accounts payable increased by $1,123,637 during the nine months ended September 30, 2012, compared to a decrease of $1,425,272 during the same period in 2011. The increases in accounts receivable and accounts payable for the nine months ended September 30, 2012 are due to higher revenues at NPI during the three months ended September 30, 2012 as a result of the seasonality of NPIs revenues. The decrease in accounts payable during the nine months ended September 30, 2011 included a one-time lump sum payment of $1,250,000 for a lawsuit settlement. Our inventories increased by $211,015 for the nine months ended September 30, 2012, compared to a decrease of $746,249 during the nine months ended September 30, 2011.

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