Insteel Industries Inc. (IIIN, Financial) filed Quarterly Report for the period ended 2008-12-27.
Insteel Industries is one of the nation's largest manufacturers of steel wire reinforcing products for concrete construction applications. The Company manufactures and markets prestressed concrete strand and welded wire reinforcement including concrete pipe reinforcement engineered structural mesh and standard welded wire reinforcement. Insteel's products are sold primarily to manufacturers of concrete products that are used in nonresidential construction. Headquartered in Mount Airy North Carolina Insteel operates six manufacturing facilities located in the United States. Insteel Industries Inc. has a market cap of $206.93 million; its shares were traded at around $8.65 with a P/E ratio of 4.2 and P/S ratio of 0.58. The dividend yield of Insteel Industries Inc. stocks is 1.02%. Insteel Industries Inc. had an annual average earning growth of 0.7% over the past 5 years.
The loss from continuing operations for the first quarter of 2009 was $5.6 million, or ($0.32) per diluted share compared with earnings from continuing operations of $4.2 million, or $0.23 per diluted share in the same year-ago period due to the decrease in sales and gross profit and the increase in SG&A expense.
The net loss for the first quarter of 2009 was $5.6 million, or ($0.32) per diluted share compared to net earnings of $4.2 million, or $0.23 per diluted share in the same year-ago period primarily due to the decrease in sales and gross profit and the increase in SG&A expense.
Operating activities of continuing operations used $15.8 million of cash for the first quarter of 2009 while providing $17.2 million in the same year-ago period largely due to the cash used by the net working capital components of accounts receivable, inventories, and accounts payable and accrued expenses together with the loss that was incurred in the current year. Net working capital used $8.7 million in the current year while providing $8.9 million in the prior year. The cash used by working capital in the current year was largely due to the $21.8 million decrease in accounts payable and accrued expenses resulting from the payment of $10.9 million of accrued income taxes payable and the reduction in accounts payable related to raw material purchases. Inventories increased $10.9 million primarily due to the reduction in shipments and receipts of imported raw material on previous purchase commitments while accounts receivable decreased $24.0 million as a result of the reductions in shipments and selling prices during the quarter. While an economic slowdown adversely affects sales to our customers, it generally reduces our working capital requirements. As the impact or ramifications of the current economic slowdown become clearer, we may make additional adjustments in our operating activities, which could impact our cash requirements accordingly.
Investing activities of continuing operations used $168,000 of cash for the first quarter of 2009 compared to $5.2 million in the same year-ago period. The decrease was primarily due to the $4.0 million reduction in capital expenditures in the current year and the $718,000 decrease in the cash surrender value of life insurance policies. Capital expenditures were $899,000 in the current year and are expected to total less than $5.0 million for fiscal 2009, although the actual amount will be determined based on future market conditions, our financial performance and additional investment opportunities that may arise. Investment activities are largely discretionary and future outlays could be reduced significantly or eliminated should economic conditions warrant.
As of December 27, 2008, we had a $100.0 million revolving credit facility in place to supplement our operating cash flow in funding our working capital, capital expenditures and general corporate requirements. As of December 27, 2008, no borrowings were outstanding on the revolving credit facility, $62.1 million of additional borrowing capacity was available and outstanding letters of credit totaled $1.2 million (see Note 7 to the consolidated financial statements).
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Insteel Industries is one of the nation's largest manufacturers of steel wire reinforcing products for concrete construction applications. The Company manufactures and markets prestressed concrete strand and welded wire reinforcement including concrete pipe reinforcement engineered structural mesh and standard welded wire reinforcement. Insteel's products are sold primarily to manufacturers of concrete products that are used in nonresidential construction. Headquartered in Mount Airy North Carolina Insteel operates six manufacturing facilities located in the United States. Insteel Industries Inc. has a market cap of $206.93 million; its shares were traded at around $8.65 with a P/E ratio of 4.2 and P/S ratio of 0.58. The dividend yield of Insteel Industries Inc. stocks is 1.02%. Insteel Industries Inc. had an annual average earning growth of 0.7% over the past 5 years.
Highlight of Business Operations:
Selling, general and administrative expense (SG&A expense) for the first quarter of 2009 increased 15.8% to $4.7 million, or 7.7% of net sales from $4.1 million, or 6.2% of net sales in the same year-ago period. The increase was primarily due to the decline in the cash surrender value of life insurance policies ($718,000) and the prior year net gain on an insurance settlement ($457,000), which were partially offset by decreases in bad debt expense ($274,000) resulting from the current period decline in accounts receivable and supplemental employee retirement plan expense ($228,000).The loss from continuing operations for the first quarter of 2009 was $5.6 million, or ($0.32) per diluted share compared with earnings from continuing operations of $4.2 million, or $0.23 per diluted share in the same year-ago period due to the decrease in sales and gross profit and the increase in SG&A expense.
The net loss for the first quarter of 2009 was $5.6 million, or ($0.32) per diluted share compared to net earnings of $4.2 million, or $0.23 per diluted share in the same year-ago period primarily due to the decrease in sales and gross profit and the increase in SG&A expense.
Operating activities of continuing operations used $15.8 million of cash for the first quarter of 2009 while providing $17.2 million in the same year-ago period largely due to the cash used by the net working capital components of accounts receivable, inventories, and accounts payable and accrued expenses together with the loss that was incurred in the current year. Net working capital used $8.7 million in the current year while providing $8.9 million in the prior year. The cash used by working capital in the current year was largely due to the $21.8 million decrease in accounts payable and accrued expenses resulting from the payment of $10.9 million of accrued income taxes payable and the reduction in accounts payable related to raw material purchases. Inventories increased $10.9 million primarily due to the reduction in shipments and receipts of imported raw material on previous purchase commitments while accounts receivable decreased $24.0 million as a result of the reductions in shipments and selling prices during the quarter. While an economic slowdown adversely affects sales to our customers, it generally reduces our working capital requirements. As the impact or ramifications of the current economic slowdown become clearer, we may make additional adjustments in our operating activities, which could impact our cash requirements accordingly.
Investing activities of continuing operations used $168,000 of cash for the first quarter of 2009 compared to $5.2 million in the same year-ago period. The decrease was primarily due to the $4.0 million reduction in capital expenditures in the current year and the $718,000 decrease in the cash surrender value of life insurance policies. Capital expenditures were $899,000 in the current year and are expected to total less than $5.0 million for fiscal 2009, although the actual amount will be determined based on future market conditions, our financial performance and additional investment opportunities that may arise. Investment activities are largely discretionary and future outlays could be reduced significantly or eliminated should economic conditions warrant.
As of December 27, 2008, we had a $100.0 million revolving credit facility in place to supplement our operating cash flow in funding our working capital, capital expenditures and general corporate requirements. As of December 27, 2008, no borrowings were outstanding on the revolving credit facility, $62.1 million of additional borrowing capacity was available and outstanding letters of credit totaled $1.2 million (see Note 7 to the consolidated financial statements).
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