Investor Relations| P & F INDUSTRIES, INC. REPORTS 1999 THIRD QUARTER AND NINE MONTHS RESULTS
Harriet Fried/Klea Theoharis
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P & F INDUSTRIES, INC. REPORTS 1999 THIRD QUARTER AND NINE MONTHS RESULTS
Sales Increase 44% and Florida Pneumatic to Begin Shipping Air Tools to Home Depot
Nevertheless, there were a number of factors that negatively impacted overall results. Among these was a strengthening of the yen by 25ince the third quarter of 1998, which reduced profits at Florida Pneumatic. In addition, Green experienced decreased labor productivity and a shift in market demand to lower margin products.
For the nine months ended September 30, 1999, revenues were $55.6 million, compared to $38.7 million for the 1998 period, an increase of 43.7%. Net income for the nine months ended September 30, 1999, at $2.9 million, was unchanged from 1998 to 1999. Diluted earnings per share were $0.79 in 1999, compared to $0.80 in 1998.
Revenues were strong quarter-over-quarter for the pneumatic tools, heating products and hardware business units, increasing 15.2%, 11.9% and 53.5%, respectively. Revenues for Green for the 1998 quarter include activity only from September 16th, the date of the acquisition, to September 30, 1998 and are therefore not comparable to 1999.
Home Depot recently expanded its distribution of P & F products to now include air tools sold by Florida Pneumatic. The Company will be providing Home Depot, beginning in the fourth quarter of 1999, with a branded line of pneumatic tools under their Husky Air Tools label, to be sold in all 850 stores nationwide. This is in addition to the hardware products manufactured by Franklin Manufacturing, which are sold in approximately 90 stores in the Northeast.
In commenting on the quarter, Richard Horowitz, Chairman, President and Chief Executive Officer, said, "We are very excited about our expanded distribution through Home Depot and look forward to a long and prosperous relationship with this exciting organization. We are also pleased to report that another major air tool customer that had experienced a slowdown earlier this year has resumed purchasing product at historical levels in the fourth quarter of 1999. Additionally, Embassy Industries continues to capture share in the hydronic heating sector in a mature market place and its radiant heating products experienced particularly strong growth in the quarter, as well."
Mr. Horowitz continued, "At Green Manufacturing, we have been disappointed with a more than 10 0ecrease in labor productivity from a year ago. The northwest Ohio labor market has tightened considerably in the last year, leading to increased employee turnover. This increased turnover, with its resultant additional hiring and training costs, has negatively affected operating results. We have addressed this problem with wage and benefit adjustments to attract and retain qualified individuals. We are hopeful that these changes will begin positively impacting productivity in the next two quarters."
P & F Industries, Inc., through its three wholly owned subsidiaries, Florida Pneumatic, Green Manufacturing and Embassy Industries, manufactures and/or imports air-powered tools, hydraulic cylinders, and baseboard and radiant heating products. The Company also imports various security hardware items and compressor air filters, markets a line of pipe-cutting and threading tools and makes heavy-duty pipe wrenches. P & F's products are sold under their own trademarks as well as under the private labels of major manufacturers and retailers.
This press release contains "forward-looking statements" within the meaning of the federal securities laws. It is important to note that these statements involve a number of risks, uncertainties and other factors that could cause the Company's actual results to differ materially from those projected in such forward-looking statements. Additional information concerning such matters is contained in the Company's Annual Report on Form 10-K for the year ended December 31, 1998, and other documents subsequently filed by the Company with the Securities and Exchange Commission, all of which are available from the Securities and Exchange Commission. CONSOLIDATED BALANCE SHEETS AND SUMMARY OF EARNINGS (PDF)
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