American International Industries Inc (AMIN, Financial) filed Quarterly Report for the period ended 2009-06-30.
AMERICAN INTERNATIONAL INDUSTRIES INC. is a diversified holding company with a business model similar to General Electric Tyco International and Berkshire Hathaway. The Company has holdings in Industry Finance and Real Estate in Houston Texas and surrounding areas and Oil & Gas. The vision of the Company is to develop holdings in various industries through acquisition of existing companies applying the financial resources and management expertise to foster the growth and profitability of the acquired businesses. The holding company serves as a financial and professional partner to the management of the subsidiaries. The role of the holding company is to improve each subsidiary\'s access to capital achieve economies of scale by consolidating administrative functions and utilize the financial and management expertise of corporate personnel across all units. The Company is continuing to work with management of the subsidiary companies to improve revenues operations and American International Industries Inc has a market cap of $10.2 million; its shares were traded at around $1.2 with a P/E ratio of 3.6 and P/S ratio of 0.4.
Total other income/expenses. Other expense was $113,564 for the three months ended June 30, 2009, compared to other income of $108,654 for the three months ended June 30, 2008. Other income was $8,286 for the six months ended June 30, 2009, compared to other expense of $1,080,865 for the six months ended June 30, 2008. Net realized/unrealized gains on trading securities were $35,771 for the three months ended June 30, 2009, compared to net losses of $1,250,565 for the three months ended June 30, 2008. Net realized/unrealized gains on trading securities were $49,643 for the six months ended June 30, 2009, compared to net losses of $2,582,531 for the six months ended June 30, 2008. The net unrealized losses on trading securities of $2,582,531 for the six months ended June 30, 2008, were due primarily to the decline in the market value of our investment in Rubicon Financial Incorporated of $2,050,000 (see note 2). Other expense for the three and six months ended June 30, 2008 included $2,945,133 for recognition of the property dividend distribution gain associated with the declaration of the Hammonds stock dividend (see note 19) and the recognition of $1,450,000 for the Delta lawsuit settlement (see note 17). After minority interest, the net impact of this settlement on the Company\'s net income was $739,500. For the six months ended June 30, 2009, American recognized other income in the amount of $198,347, of which $175,000 was for providing right-of-way access on the 287 acres in Galveston County. Interest expense was $482,279 for the six months ended June 30, 2009, compared to $410,492 for the six months ended June 30, 2008. The increase in interest expense was due primarily to the $5 million in debt used to fund the acquisition of the assets of Shumate Machine Works.
Net loss. We had a net loss from continuing operations of $645,133, or $0.08 per share, for the three months ended June 30, 2009, compared to net income of $563,931, or $0.08 per share, for the same period in 2008. We had a net loss from discontinued operations of $350,000, or $0.04 per share, for the three months ended June 30, 2009, compared to net a net loss of $678,050, or $0.10 per share, for the same period in 2008. Our net loss was $852,248, or $0.10 per share, for the three months ended June 30, 2009, compared to net income of $176,265, or $0.02 per share, for the three months ended June 30, 2008. We had a net loss from continuing operations of $988,041, or $0.11 per share, for the six months ended June 30, 2009, compared to a net loss of $2,066,564, or $0.29 per share, for the same period in 2008. We had a net loss from discontinued operations of $350,000, or $0.04 per share, for the six months ended June 30, 2009, compared to net a net loss of $1,476,609, or $0.21 per share, for the same period in 2008. Our net loss was $1,045,387, or $0.12 per share, for the six months ended June 30, 2009, compared to a net loss of $3,004,547, or $0.42 per share, for the six months ended June 30, 2008.
Cash flow from operations. For the six months ended June 30, 2009, cash flow used in operations was $4,200, compared to cash flow used in operations of $2,614,041 during the same period in 2008. Our net loss of $988,041 for the six months ended June 30, 2009 included non-cash expenses of $632,735, including depreciation and amortization of $591,485 and share-based compensation of $41,250. Our net loss of $2,066,564 for the six months ended June 30, 2008 included non-cash income of $2,945,133 for recognition of the property dividend distribution gain associated with the declaration of the Hammonds stock dividend (see note 19) and non-cash expenses of $4,594,693, including unrealized losses on trading securities of $2,653,670, recognition of $1,450,000 for the Delta lawsuit settlement (see note 17), depreciation and amortization of $237,399, share-based compensation of $253,624. Our inventories increased by $797,874 for the six months ended June 30, 2009, compared to an increase of $464,076 during the six months ended June 30, 2008. We decreased our investments in trading securities by $124,148 during the six months ended June 30, 2009, compared to an increase of $95,289 during the same period in 2008. Accounts receivable decreased by $564,466 during the six months ended June 30, 2009, compared to an increase of $563,564 during the same period in 2008. Prepaid expenses increased by $188,401, other assets decreased by $38,830, and accounts payable increased by $659,580 for the six months ended June 30, 2009. For the six months ended June 30, 2008, prepaid expenses increased by $1,196,578, other assets decreased by $9,861, and accounts payable increased by $241,337.
Cash flow from investing activities. Our investing activities provided cash of $964,076 during the six month period ended June 30, 2009, as a result of a net decrease in investments in certificates of deposit of $1,550,000, offset by the issuance of a note receivable of $300,000, loans to related parties of $221,939, and purchases of property and equipment of $133,821. This is compared to cash provided by investing activities during the same period in the prior year in the amount of $44,782, as a result of a net decrease in investments in certificates of deposit of $184,579 and proceeds from the sale of drilling rig equipment of $200,000, offset by the issuance of a note for $225,000 and the purchase of property and equipment of $142,194.
Cash flow from financing activities. During the six months ended June 30, 2009, our financing activities used cash of $1,667,112 compared to cash provided of $2,529,498 during the same period in 2008. During the six month period ended June 30, 2009, we made payments of $1,695,306 on debt and purchased 211,746 shares of treasury stock at a cost of $192,675. During the 2008 period, we received net proceeds from the issuance of debt of $2,117,663 and from line-of-credit agreements of $1,427,000. We made payments of $760,175 on debt and margin loans during the six month period ended June 30, 2008.
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AMERICAN INTERNATIONAL INDUSTRIES INC. is a diversified holding company with a business model similar to General Electric Tyco International and Berkshire Hathaway. The Company has holdings in Industry Finance and Real Estate in Houston Texas and surrounding areas and Oil & Gas. The vision of the Company is to develop holdings in various industries through acquisition of existing companies applying the financial resources and management expertise to foster the growth and profitability of the acquired businesses. The holding company serves as a financial and professional partner to the management of the subsidiaries. The role of the holding company is to improve each subsidiary\'s access to capital achieve economies of scale by consolidating administrative functions and utilize the financial and management expertise of corporate personnel across all units. The Company is continuing to work with management of the subsidiary companies to improve revenues operations and American International Industries Inc has a market cap of $10.2 million; its shares were traded at around $1.2 with a P/E ratio of 3.6 and P/S ratio of 0.4.
Highlight of Business Operations:
Delta reported revenues of $2,331,214 for the three months ended June 30, 2009, compared to $5,169,849 for the same period in 2008, representing a decrease of $2,838,635, or 54.9%. For the six months ended June 30, 2009, Delta\'s revenues were $4,795,125, compared to $7,252,798 for the six months ended June 30, 2008, representing a decrease of $2,457,673, or 33.9%. The decrease in revenues at Delta is due to a decrease in pipe sales for the three and six months of $2,776,769 and $3,102,223, respectively, to the oil field service industry. Pipe sales revenues have decreased due to a decline in drilling activity creating a decline in demand for pipe. Rig service revenues for the three and six months increased by $319,096 and $263,588, respectively, due to the addition of a new rig.Total other income/expenses. Other expense was $113,564 for the three months ended June 30, 2009, compared to other income of $108,654 for the three months ended June 30, 2008. Other income was $8,286 for the six months ended June 30, 2009, compared to other expense of $1,080,865 for the six months ended June 30, 2008. Net realized/unrealized gains on trading securities were $35,771 for the three months ended June 30, 2009, compared to net losses of $1,250,565 for the three months ended June 30, 2008. Net realized/unrealized gains on trading securities were $49,643 for the six months ended June 30, 2009, compared to net losses of $2,582,531 for the six months ended June 30, 2008. The net unrealized losses on trading securities of $2,582,531 for the six months ended June 30, 2008, were due primarily to the decline in the market value of our investment in Rubicon Financial Incorporated of $2,050,000 (see note 2). Other expense for the three and six months ended June 30, 2008 included $2,945,133 for recognition of the property dividend distribution gain associated with the declaration of the Hammonds stock dividend (see note 19) and the recognition of $1,450,000 for the Delta lawsuit settlement (see note 17). After minority interest, the net impact of this settlement on the Company\'s net income was $739,500. For the six months ended June 30, 2009, American recognized other income in the amount of $198,347, of which $175,000 was for providing right-of-way access on the 287 acres in Galveston County. Interest expense was $482,279 for the six months ended June 30, 2009, compared to $410,492 for the six months ended June 30, 2008. The increase in interest expense was due primarily to the $5 million in debt used to fund the acquisition of the assets of Shumate Machine Works.
Net loss. We had a net loss from continuing operations of $645,133, or $0.08 per share, for the three months ended June 30, 2009, compared to net income of $563,931, or $0.08 per share, for the same period in 2008. We had a net loss from discontinued operations of $350,000, or $0.04 per share, for the three months ended June 30, 2009, compared to net a net loss of $678,050, or $0.10 per share, for the same period in 2008. Our net loss was $852,248, or $0.10 per share, for the three months ended June 30, 2009, compared to net income of $176,265, or $0.02 per share, for the three months ended June 30, 2008. We had a net loss from continuing operations of $988,041, or $0.11 per share, for the six months ended June 30, 2009, compared to a net loss of $2,066,564, or $0.29 per share, for the same period in 2008. We had a net loss from discontinued operations of $350,000, or $0.04 per share, for the six months ended June 30, 2009, compared to net a net loss of $1,476,609, or $0.21 per share, for the same period in 2008. Our net loss was $1,045,387, or $0.12 per share, for the six months ended June 30, 2009, compared to a net loss of $3,004,547, or $0.42 per share, for the six months ended June 30, 2008.
Cash flow from operations. For the six months ended June 30, 2009, cash flow used in operations was $4,200, compared to cash flow used in operations of $2,614,041 during the same period in 2008. Our net loss of $988,041 for the six months ended June 30, 2009 included non-cash expenses of $632,735, including depreciation and amortization of $591,485 and share-based compensation of $41,250. Our net loss of $2,066,564 for the six months ended June 30, 2008 included non-cash income of $2,945,133 for recognition of the property dividend distribution gain associated with the declaration of the Hammonds stock dividend (see note 19) and non-cash expenses of $4,594,693, including unrealized losses on trading securities of $2,653,670, recognition of $1,450,000 for the Delta lawsuit settlement (see note 17), depreciation and amortization of $237,399, share-based compensation of $253,624. Our inventories increased by $797,874 for the six months ended June 30, 2009, compared to an increase of $464,076 during the six months ended June 30, 2008. We decreased our investments in trading securities by $124,148 during the six months ended June 30, 2009, compared to an increase of $95,289 during the same period in 2008. Accounts receivable decreased by $564,466 during the six months ended June 30, 2009, compared to an increase of $563,564 during the same period in 2008. Prepaid expenses increased by $188,401, other assets decreased by $38,830, and accounts payable increased by $659,580 for the six months ended June 30, 2009. For the six months ended June 30, 2008, prepaid expenses increased by $1,196,578, other assets decreased by $9,861, and accounts payable increased by $241,337.
Cash flow from investing activities. Our investing activities provided cash of $964,076 during the six month period ended June 30, 2009, as a result of a net decrease in investments in certificates of deposit of $1,550,000, offset by the issuance of a note receivable of $300,000, loans to related parties of $221,939, and purchases of property and equipment of $133,821. This is compared to cash provided by investing activities during the same period in the prior year in the amount of $44,782, as a result of a net decrease in investments in certificates of deposit of $184,579 and proceeds from the sale of drilling rig equipment of $200,000, offset by the issuance of a note for $225,000 and the purchase of property and equipment of $142,194.
Cash flow from financing activities. During the six months ended June 30, 2009, our financing activities used cash of $1,667,112 compared to cash provided of $2,529,498 during the same period in 2008. During the six month period ended June 30, 2009, we made payments of $1,695,306 on debt and purchased 211,746 shares of treasury stock at a cost of $192,675. During the 2008 period, we received net proceeds from the issuance of debt of $2,117,663 and from line-of-credit agreements of $1,427,000. We made payments of $760,175 on debt and margin loans during the six month period ended June 30, 2008.
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