Gencor Industries Inc. (GENC, Financial) filed Quarterly Report for the period ended 2008-12-31.
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 $63.35 million; its shares were traded at around $8.258 with a P/E ratio of 5.2 and P/S ratio of 0.72. The dividend yield of Gencor Industries Inc. stocks is 0.64%.
We recognized income from investees of $48 in the three months ended December 31, 2008 and $15,625 in the three months ended December 31, 2007. The operations of Carbontronics LLC consist of the receipt of contingent payments from the sales from the plants and the distribution thereof to its members. Carbontronics LLC has no other significant operations or assets. The operations of Carbontronics II, LLC consist of the receipt of royalty payments from the plants and the distribution thereof to its members. Carbontronics II, LLC has no other significant operations or assets. Any income arising from these investments is dependent upon tax credits (adjusted for operating losses at the fuel plants) being generated as a result of synthetic fuel production, which are recorded as received. These distributions are subject to state and Federal income taxes. Distributions from these entities depend upon the production of these operations qualifying for tax credits under Section 29 of the Internal Revenue Code and the ability to economically produce and market synthetic fuel produced by the plants.
For the three months ended December 31, 2008, the decrease of $1,933 in our marketable securities is a result of a decrease in the market value of the securities held in the portfolio. For the three months ended December 31, 2007, the increase in value of our marketable securities was a result of additional net cash invested of $15,000 and an increase of $493 in the market value of the securities held in the portfolio. Included in other income for the three months ended December 31, 2007 was the receipt of $4,100 in resolution of an outstanding claim against a former service provider less related legal costs of $700. The terms of the settlement are confidential and we do not expect any further collections or expenses related to this matter.
We generate our capital resources primarily through operations. We entered into 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 provides for advances based on accounts receivable, inventory and real estate. The facility includes a $2 million limit on letters of credit. At December 31, 2008, we had $.8 million of letters of credit outstanding. The interest rate at December 31, 2008, is at LIBOR plus 2.00% and subject to change based upon the Fixed Charge Coverage Ratio. We are required to maintain a Fixed Charge Coverage Ratio of 1.1:1. There are no required repayments as long as there are no defaults and there is adequate eligible collateral. Substantially all of our assets are pledged as security under the Agreement. We had no long term debt outstanding at December 31, 2008 or 2007.
As of December 31, 2008, we had $240 in cash and cash equivalents, and $52 million in marketable securities. The marketable securities are invested in stocks and bonds through a professional investment advisor. The securities may be liquidated at any time into cash and cash equivalents.
Our backlog is at $8 million for the three months ended December 31, 2008 versus $24.5 million in the three months ended December 31, 2007. Orders have reduced significantly as a result of the recession and credit tightening in the last half of calendar 2008.
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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 $63.35 million; its shares were traded at around $8.258 with a P/E ratio of 5.2 and P/S ratio of 0.72. The dividend yield of Gencor Industries Inc. stocks is 0.64%.
Highlight of Business Operations:
Net sales for the three months ended December 31, 2008 and 2007 were $19,260 and $18,323, respectively. Domestic sales during the three months ended December 31, 2008 were $18,468 reflecting an increase of $693 from the first quarter of fiscal 2008. Domestic sales were higher than the prior years quarter primarily due to completion of orders in the backlog. Foreign sales increased $244 in the three months ended December 31, 2008 compared to the three months ended December 31, 2007. Our revenues are concentrated in the asphalt-related business and subject to a seasonal slow-down during the third and fourth quarters of the calendar year. We cannot predict what impact the recession and tightening of the credit markets in the last half of calendar 2008, will have on future earnings.We recognized income from investees of $48 in the three months ended December 31, 2008 and $15,625 in the three months ended December 31, 2007. The operations of Carbontronics LLC consist of the receipt of contingent payments from the sales from the plants and the distribution thereof to its members. Carbontronics LLC has no other significant operations or assets. The operations of Carbontronics II, LLC consist of the receipt of royalty payments from the plants and the distribution thereof to its members. Carbontronics II, LLC has no other significant operations or assets. Any income arising from these investments is dependent upon tax credits (adjusted for operating losses at the fuel plants) being generated as a result of synthetic fuel production, which are recorded as received. These distributions are subject to state and Federal income taxes. Distributions from these entities depend upon the production of these operations qualifying for tax credits under Section 29 of the Internal Revenue Code and the ability to economically produce and market synthetic fuel produced by the plants.
For the three months ended December 31, 2008, the decrease of $1,933 in our marketable securities is a result of a decrease in the market value of the securities held in the portfolio. For the three months ended December 31, 2007, the increase in value of our marketable securities was a result of additional net cash invested of $15,000 and an increase of $493 in the market value of the securities held in the portfolio. Included in other income for the three months ended December 31, 2007 was the receipt of $4,100 in resolution of an outstanding claim against a former service provider less related legal costs of $700. The terms of the settlement are confidential and we do not expect any further collections or expenses related to this matter.
We generate our capital resources primarily through operations. We entered into 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 provides for advances based on accounts receivable, inventory and real estate. The facility includes a $2 million limit on letters of credit. At December 31, 2008, we had $.8 million of letters of credit outstanding. The interest rate at December 31, 2008, is at LIBOR plus 2.00% and subject to change based upon the Fixed Charge Coverage Ratio. We are required to maintain a Fixed Charge Coverage Ratio of 1.1:1. There are no required repayments as long as there are no defaults and there is adequate eligible collateral. Substantially all of our assets are pledged as security under the Agreement. We had no long term debt outstanding at December 31, 2008 or 2007.
As of December 31, 2008, we had $240 in cash and cash equivalents, and $52 million in marketable securities. The marketable securities are invested in stocks and bonds through a professional investment advisor. The securities may be liquidated at any time into cash and cash equivalents.
Our backlog is at $8 million for the three months ended December 31, 2008 versus $24.5 million in the three months ended December 31, 2007. Orders have reduced significantly as a result of the recession and credit tightening in the last half of calendar 2008.
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