Gencor Industries Inc. (GENC, Financial) filed Quarterly Report for the period ended 2009-06-30.
Gencor Industries Inc. designs manufacturers and markets process machinery equipment. Products include machinery used in the production of highway construction materials such as hotmix asphalt and machinery used to produce food products such as pelletized animal feeds edible oils sugar and citrus juices. The Company operates in two business groups-Construction Equipment Group and Consolidated Process Machinery Group. Gencor Industries Inc. has a market cap of $55.4 million; its shares were traded at around $6.86 with a P/E ratio of 98 and P/S ratio of 0.6.
Net sales for the nine months ended June 30, 2009 and 2008 were $46,350 and $66,812, respectively. Domestic sales during the nine months ended June 30, 2009 and 2008 were $45,264 and $64,713, respectively, reflecting a decrease of $19,449. Domestic sales were lower than the comparable period in the prior year. We believe this was primarily due to the overall worsening of the economy and tightening of credit availability.
For the three months ended June 30, 2009, and for the nine months ended June 30, 2009, the change in value of our marketable securities was a gain of $174, and a loss of $1,288, respectively. During the quarter ended June 30, 2009, we transferred $6,000 from our operating cash accounts to our investment portfolio. After this transfer, the cost basis in our investments portfolio grew from $46,000 to $52,000. For the three months ended June 30, 2008, and for the nine months ended June 30, 2008, the change in value of our marketable securities was a loss of $2, and $867, respectively. All of these decreases were the result of decreases in the market value of the securities held in the portfolio.
We maintained a Revolving Credit and Security Agreement with PNC Bank, N.A. The Agreement established a three year revolving $20 million credit facility and was renewed through July 31, 2009. The facility provided for advances based on accounts receivable, inventory, and real estate. The facility included a $2 million limit on letters of credit. At June 30, 2009, we had $1.1 million of letters of credit outstanding. The interest rate at June 30, 2009, is at LIBOR plus 2.00% and subject to change based upon the Fixed Charge Coverage Ratio. We were required to maintain a Fixed Charge Coverage Ratio of 1.1:1. There were no required repayments as long as there were no defaults and there was adequate eligible collateral. Substantially all of our assets were pledged as security under the Agreement. We had no long term debt outstanding at June 30, 2009 or 2008. Prior to expiration of our credit facility with PNC Bank, we elected to amend this agreement as disclosed under the heading, Contractual Obligations, as set forth below in this Item 2.
Cash utilized for Investing activities during the nine months period ended June 30, 2009 was $205 thousand and was primarily the result of capital expenditures. We historically operated a manufacturing facility and sales office in the United Kingdom. The revenues of the UK operations have been insignificant to our financial results. In June 2009, we sold our UK operations for $648 thousand dollars (not including transaction costs of $22 thousand dollars) and recognized a loss of $447 thousand dollars. We retained ownership of the building and land, the brand
We amended the Revolving Credit and Security Agreement with PNC Bank, N.A., on July 23, 2009. The original agreement was set to expire on July 31, 2009, and rather than let it expire, we elected to amend this agreement and reduce the amount of the credit facility from $20 million to $1.5 million. The facility also includes a $1.285 million limit on letters of credit, which is reduced from our original $2 million limit. We elected to reduce our credit facility at this time because we believe the higher amount associated with the original line was not needed. We are currently evaluating other options for a revolving credit facility.
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Gencor Industries Inc. designs manufacturers and markets process machinery equipment. Products include machinery used in the production of highway construction materials such as hotmix asphalt and machinery used to produce food products such as pelletized animal feeds edible oils sugar and citrus juices. The Company operates in two business groups-Construction Equipment Group and Consolidated Process Machinery Group. Gencor Industries Inc. has a market cap of $55.4 million; its shares were traded at around $6.86 with a P/E ratio of 98 and P/S ratio of 0.6.
Highlight of Business Operations:
Net sales for the three months ended June 30, 2009 and 2008 were $11,674 and $23,907, respectively. Domestic sales during the three months ended June 30, 2009 and 2008 were $11,653 and $22,670, respectively, reflecting a decrease of $11,017. Domestic sales were lower than the prior years comparable quarter. We believe this was primarily due to the overall worsening of the economy and tightening of credit availability. Foreign sales decreased $1,127 in the three months ended June 30, 2009 compared to the three months ended June 30, 2008.Net sales for the nine months ended June 30, 2009 and 2008 were $46,350 and $66,812, respectively. Domestic sales during the nine months ended June 30, 2009 and 2008 were $45,264 and $64,713, respectively, reflecting a decrease of $19,449. Domestic sales were lower than the comparable period in the prior year. We believe this was primarily due to the overall worsening of the economy and tightening of credit availability.
For the three months ended June 30, 2009, and for the nine months ended June 30, 2009, the change in value of our marketable securities was a gain of $174, and a loss of $1,288, respectively. During the quarter ended June 30, 2009, we transferred $6,000 from our operating cash accounts to our investment portfolio. After this transfer, the cost basis in our investments portfolio grew from $46,000 to $52,000. For the three months ended June 30, 2008, and for the nine months ended June 30, 2008, the change in value of our marketable securities was a loss of $2, and $867, respectively. All of these decreases were the result of decreases in the market value of the securities held in the portfolio.
We maintained a Revolving Credit and Security Agreement with PNC Bank, N.A. The Agreement established a three year revolving $20 million credit facility and was renewed through July 31, 2009. The facility provided for advances based on accounts receivable, inventory, and real estate. The facility included a $2 million limit on letters of credit. At June 30, 2009, we had $1.1 million of letters of credit outstanding. The interest rate at June 30, 2009, is at LIBOR plus 2.00% and subject to change based upon the Fixed Charge Coverage Ratio. We were required to maintain a Fixed Charge Coverage Ratio of 1.1:1. There were no required repayments as long as there were no defaults and there was adequate eligible collateral. Substantially all of our assets were pledged as security under the Agreement. We had no long term debt outstanding at June 30, 2009 or 2008. Prior to expiration of our credit facility with PNC Bank, we elected to amend this agreement as disclosed under the heading, Contractual Obligations, as set forth below in this Item 2.
Cash utilized for Investing activities during the nine months period ended June 30, 2009 was $205 thousand and was primarily the result of capital expenditures. We historically operated a manufacturing facility and sales office in the United Kingdom. The revenues of the UK operations have been insignificant to our financial results. In June 2009, we sold our UK operations for $648 thousand dollars (not including transaction costs of $22 thousand dollars) and recognized a loss of $447 thousand dollars. We retained ownership of the building and land, the brand
We amended the Revolving Credit and Security Agreement with PNC Bank, N.A., on July 23, 2009. The original agreement was set to expire on July 31, 2009, and rather than let it expire, we elected to amend this agreement and reduce the amount of the credit facility from $20 million to $1.5 million. The facility also includes a $1.285 million limit on letters of credit, which is reduced from our original $2 million limit. We elected to reduce our credit facility at this time because we believe the higher amount associated with the original line was not needed. We are currently evaluating other options for a revolving credit facility.
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