{"id":379606,"date":"2020-11-12T08:03:48","date_gmt":"2020-11-12T13:03:48","guid":{"rendered":"http:\/\/www.marketnewsdesk.com\/?p=379606"},"modified":"2020-11-12T08:03:48","modified_gmt":"2020-11-12T13:03:48","slug":"pf-industries-inc-reports-results-for-the-three-and-nine-month-periods-ended-september-30-2020","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/pf-industries-inc-reports-results-for-the-three-and-nine-month-periods-ended-september-30-2020\/","title":{"rendered":"P&F Industries, Inc. Reports Results For The Three And Nine-Month Periods Ended September 30, 2020"},"content":{"rendered":"
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PR Newswire<\/p>\n<\/p><\/div>\n

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\n MELVILLE, N.Y.<\/span>, Nov. 12, 2020<\/span> \/PRNewswire\/ —\u00a0P&F Industries, Inc. (NASDAQ: PFIN) today announced its results from operations for the three and nine-month periods ended September 30, 2020<\/span>. The Company is reporting net revenue of $12,406,000<\/span> and $37,276,000<\/span> for the three and nine-month periods ended September 30, 2020<\/span>, compared to $14,776,000<\/span> and $43,896,000<\/span> for the same periods in 2019.\u00a0 The Company stated that there were several factors that negatively impacted its fiscal third quarter 2020 results, key among them were the ongoing global COVID-19 pandemic, continued weakness in the aerospace sector, and a greatly depressed oil and gas market. \u00a0As such, for the three and nine-month periods ended September 30, 2020<\/span>, the Company is reporting net losses before income taxes of $1,193,000<\/span> and $5,651,000<\/span>, respectively, compared to net income before income taxes of $128,000<\/span> and $7,881,000<\/span>, respectively, for the same periods a year ago. The Company noted it recorded a gain on the sale of real property of approximately $7,800,000<\/span> during the second quarter of 2019. The Company is reporting net loss after-taxes of $857,000<\/span> and $3,996,000<\/span>, respectively, for the three and nine-month periods ended September 30, 2020<\/span>, compared to net income after taxes of $136,000<\/span> and $5,798,000<\/span>, respectively for the same periods in 2019. <\/p>\n

\n Richard Horowitz<\/span>, the Company’s Chairman of the Board, Chief Executive Officer and President commented, “The decline in revenue this quarter, compared to the same period a year ago, was driven by the ongoing effects of the COVID-19 global pandemic, the downturn in global oil and gas exploration and production activity and weakness in the\u00a0 aerospace sector. \u00a0Many of our lines of business continue to encounter year over year declines, which we believe are being driven primarily by the pandemic. \u00a0Additionally, the Boeing Company’s decision to continue to severely limit all production of its 737 MAX aircraft, as well as reduced production of military and other commercial aircraft throughout the industry, is the primary factor for the decline in our aerospace revenue. These and other factors resulted in poor overhead absorption at our manufacturing facilities which, in turn, severely affected our overall gross margin.” \u00a0\u00a0\u00a0<\/p>\n

Mr. Horowitz continued, “On a more positive note, we are currently beginning to see modest signs of improvement. Our Retail and Automotive orders have begun to rebound and have increased significantly from the lows reached during the height of the pandemic. Overall, revenue company-wide was up approximately 8% in the third quarter of 2020 as compared to the second quarter of 2020. Further, third quarter 2020 losses before income taxes declined approximately $2,000,000<\/span> compared to the second quarter of 2020, although $1,600,000<\/span> of such decline in losses was due to a second quarter 2020 impairment charge which did not repeat in the third quarter. Our selling, general and administrative expenses declined $535,000<\/span> or 10.3% this quarter compared to the third quarter of 2019. \u00a0Further, with respect to the gear businesses acquired in the fourth quarter of 2019, which have been combined with Hy-Tech’s Quality Gear line and are \u00a0now collectively referred to as Power Transmission Group, or PTG, \u00a0orders and sales have been relatively steady.\u00a0 Unfortunately, our legacy Quality Gear business has struggled as a significant portion of \u00a0this product line has traditionally been sold to the oil and gas and mining industries.\u00a0 Despite that news, PTG revenue this quarter was $1,027,000<\/span>, an increase of more than $700,000<\/span>, compared to the same period in 2019.\u00a0 This is in spite of very limited ability to visit customers. We are therefore very optimistic that there are many additional opportunities for growth in our PTG product line,<\/u><\/i><\/b> once customer visits are again permitted.\u00a0 Lastly, we are also very encouraged \u00a0about the opportunities relating to a number of military and commercial aerospace projects that have been under development throughout the pandemic.\u00a0 Tool samples for these projects are ready for testing at potential customers in the United States<\/span> and Europe<\/span>. We expect product testing and evaluations to begin once potential customers are more fully staffed, which we hope will be sometime this year. However, very recent closures in certain European countries may once again delay these prospects.” <\/p>\n

Mr. Horowitz concluded his remarks with, “While the COVID-19 global pandemic remains, and our results from operations will be challenged, we plan to continue to serve our customer’s needs, while also ensuring the \u00a0health and safety of our employees.\u00a0 Product development continues across the Company’s businesses.\u00a0 In addition, we expect to further expand our Engineered Solutions business and PTG, through the pursuit of new applications, customers, and markets, both in the United States<\/span> and Europe<\/span>. We are confident that when this pandemic subsides, we will be well positioned to take advantage of the economic recovery. We remain focused on being a key provider and developer of power hand tools and accessories.\u00a0\u00a0\u00a0 Despite the recent losses, we believe we have access to ample capital under our credit facility, as we ride out the downturn caused by the pandemic. Further, as part of the business incentives offered in the Coronavirus Aid, Relief, and Economic Security Act, on April 20, 2020<\/span>, we received a $2.9 million<\/span> Payroll Protection Program (“PPP”) loan from the United States Small Business Administration, which we were able to use to help fund our payroll and other permitted business expenses. We plan to submit our application for forgiveness of the loan shortly. We believe we have met all criteria necessary to have most, \u00a0if not all, of the PPP loan forgiven, however, this determination is subject to review by our PPP lender bank and the Small Business Administration.\u00a0 Finally, I wish to thank and recognize the incredible work our employees have done to navigate through these unprecedented times.”<\/p>\n

The Company will be reporting the following:<\/p>\n

\n OVERVIEW<\/b>\n <\/p>\n

Key factors or events impacting our third quarter 2020 results of operations were:<\/p>\n