Full Year 2020 P&F Industries Inc Earnings Call

Impairment along with assets and Goodwill unforeseen inventory adjustments or changes in purchasing patterns Market acceptance of products acquisition of businesses regulatory environment and information technology system failures and attacks and those other risks and uncertainties described in the reports and statements filed by the company with the Securities and Exchange Commission, including among others that describe a recent annual report on form 10-K a quarterly reports on form 10-q and our other filings these risks could cause the company's actual results in future periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the company forward-looking statements speak only as of the date on which they are made and the company undertakes no obligation to update publicly or revise. I was looking statements whether as a result of new information future developments or otherwise with that I would now like to turn the call over to Richard Horowitz. Good morning, Richard.

Good morning. Thank you. Everybody here on the call today to joining us this morning on our full-year 2020 results. I hope and pray that all of you are doing well under these continuing really difficult circumstances with COVID-19 or other vaccine roll out which will certainly help control. The study disease is underway. We are still working to get past the harsh effects of This Global pandemic Leslie. Our thoughts and prayers are with all of those affected by COVID-19 and your family your friends or anybody else around them. I would like to direct your own the business matter. I'd like to direct your attention to the company and press release that was released earlier today, which includes the company December 3120 balance sheets and statements of operation a statement of cash flows and discussions related to the company's twenty-twenty results of operations. This release should should answer most of your questions in order to make better use of evidence time.

This morning and be monitored.

Of this conference call. I would like to note the following 2 items as I've said in the past firstly as you've done for the prior to conference calls and will become our standard practice from this point forward them directly to a question-and-answer session and not restate what is already in this morning's release. And secondly, Please be aware that we will only be answering questions directly relating to the company's results of operations and financial condition. You must insist that you get this procedure management will not be entertaining any questions that go beyond the scope of this call and with that role in there and what I've said, we'd be happy to answer any questions anybody may have at this time Orlando. Please open up the email. Thank you. Absolutely. And if you would like to ask a question, please signal by pressing star one on your telephone keypad. If using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Once again everyone. If you'd like to ask a question, press star one on your telephone keypad will pass.

quick moment to assemble the queue

And once again everyone that is star one to ask a question, and we'll go to our first question from Andrew Shapiro with Lawndale Capital Management. One moment, please.

I thank you. Can you hear me?

Yes, I hear you fine. Great several questions are asked a few in the back out into the key in case there's others first and the four motion. I wanted to find out her ask if you guys what is there a particular reason or why is it in your fourth quarter of lease? You only provide fiscal year end and we can't easily determine and calculate here the fourth quarter results without having a go to the year-to-date nine months and try to back things out and and reverse-engineer. It can most companies break out their fourth-quarter. Is there a particular problem or a reason that p&f chooses not to do that?

Yeah, Andrew be regulated this morning and we've gone through this with review and we went through this with our lawyers and accountants and we believe the information contained in our customer totally appropriate for a company of our size and our lawyers and our our accountants have told us without question that they were so happy, you know that being said, you know happy to answer any other questions, but that's just an advisor. That's the way it's done this company website or much bigger companies actually even so that's why we do it.

Well, maybe they should widen your scope of research on it other companies do before the quarter and they break it out. I just don't understand if there was a particular problem for people so I so different and giving you the answer. Let's let's go on with your questions cuz that's that's actually been advised to do and that's how we proceed. I'm just wondering why they advised them. Anyway that have children questions you have.

Can you?

Things have evolved in on this. I'd like to get a feel for where operations currently stand, you know, this isn't questions with respect to the impacts of COVID-19. It sounds like in a crowd you still working from home the dog there. Um, I wanted to understand we're to operations currently stay on for the company both at its headquarters. It sounds like you guys might be working remotely and in each manufacturing facility in in what is the return to normal plans that in expectations of time you guys have or what is the normal for the company headquarters as well as the manufacturer if you manufacturing facilities

Yeah, go ahead Joe. You can you can answer that I guess with respect to the subsidiaries the we're fully staffed at the same operational level. We we are fortunate that we can socially distance and compartmentalize people fairly easily at each of our locations, So they're really at this point is next to no impact on our production capabilities people in offices where things are a little tighter off alternate ships and you know, there's a certain schedule that we follow to try to maintain social life have a few people in tight quarters as possible the same goes for for New York. We do not they're probably we're in the office.

Sixty percent of the time. But again, we try to minimize the we never have the full staff in here at once and that will probably be the I mean, I don't want to project too far forward cuz I can't tell you what the path of the virus is going to be and where we're going to be on vaccinations, but I would imagine that that will will will ease back into full everyone being the offset some point, but for now it's a little too early to say exactly when that be well that'll be but that is certainly the plan but it's not it's not affecting our ability to do our jobs.

Okay, and do you have an estimate of the percentage of the workforce presently vaccinated with one shot or Fallen fully vaccinated and has the company initiated or considered initial Financial incentives or bonuses for employees who do get vaccinated?

Now we we have not considered that as I said right now the impact on our ability to generate production and shipping products is next to nothing. So I'm not sure what that incentive would do other than make people, you know feel better and obviously the more people vaccinated get better. But the impact on our operations is really non-existent at this point in the corporate office of people have been vaccinated of time and the descriptions are the age of the people and the rules in the in the states. So we can't that we have to get to the rules like everybody else like you were in here and everybody else. I just said in the in the uh, but we will consider it. I guess you can you know what's going on, but our end as far as as far as the company itself off.

Really very minimal very minimal impact thankfully thankfully and both of our companies are really operating fairly.

Yeah, we only done police at this time. Okay, and my final question on the COVID-19 issues and not back out into the key, but I had questions for your divisions and product lines off. Yeah, I think you commented in your press release regarding the demand product demand perspective and your faith in facts regarding COVID-19. Are you experiencing and and what what types of steps are you doing to mitigate any negative experiences off from impacting your supply chain, which we are increasingly reading about, you know, impacting manufacturing companies.

Yeah, joking it onto the filter. But we're we're having which I'm sure you read about every day in the newspapers. You are having the same problems with everyone else is having internet amazing shipments coming from China. Now, the latest little wrinkle is the Suez Canal was shut down and everything is all backed up there but way before that I'm waiting we're adding six eight weeks two deliveries and Iraq in the regular standard and even when they come into the country be at Miami albeit on the west Palm make an need the shipping can sit there for quite a period of time days a week even two weeks before customers and what you don't go and if that's something that's going on with us for several months now and and people I know with other businesses are finding the exact same thing that people who I know when the shipping business or I know several in that big businesses. Wow.

They're all very very frustrated what's going on how it's happening and seems to be a very convenient excuse for every things don't work out to bring that covet. So I mean it may be right in many cases, but I can't imagine why now with China is open till today. It's it's not getting any better, but it is not getting any better. You want to answer that. I mean, I would just add that.

The impact on the importation is is primarily with Florida pneumatic high-tech doesn't have a significant portion of our inputs coming from Asia.

As a result of having a several distribution system. However, ultimately there isn't really a significant impact an Ultimate Sales in that you know, for how for example Home Depot there's distribution centres we ship to and then there's inventory at the stores. So customers are not showing up at the store or not being able to get product because if you can't there's several several levels of inventory in the in the Stream

No, the other steps you're taking to mitigate the effects of discontinuing slow down in some Supply.

well, we you know, we're go ahead we're projecting ahead as best we can we're we're making sure that we're providing additional Safety stock and we're keeping a very, you know,

lighting control over, you know, the inventory levels and working with suppliers where we can there are also Alternatives with respect to where where she can land in in the past. We've we've been able to redirect things should that become necessary right now, it has become necessary but we have several levels we could do to to move to move where ships actually land and and possibly from there go go Overland to get to us. So right now it hasn't really impacted the business in a significant way, but we're obviously keeping an eye on it several months. We've increased our you know, our safety safety a little bit but it's a balance. You don't want to be overly, you know, we don't want to buy this money and Thursday.

Also, we've been doing a fairly good job of staying ahead of the for the most part for the most part. I'm sorry. Okay, I have several other questions, but I'll back off the queue and I don't I don't believe there's anybody I'm actually right now so you can go. All right, so moving on and talking a little bit about your gear products a conditions, which were made right before the pandemic kicked in and you were even literally integrating uh equipment and you know and and consolidating facilities and zip code hit and smell kind of become I guess you call it your power transmission group ptg. Can you is It Disco Cloud your ability to elaborate on the Strategic benefits of the acquisition yet. We've talked about

That the acquisition opened up a broader range of Industries for you and and you mentioned specifically actively pursuing opportunities and Healthcare Transportation food production and power generation Industries and your current press release issued this morning said you witnessed an increase in orders in sales activity. Can you elaborate a bit more about this and the impact and benefits of this acquisition towards that and and what has been your success in in these particular new Industries you were targeted. I mean, I think I think I do because the press release so if you want to add more color. You can

Well, the the power transmission group and you know, just talking.

Back gear specifically really anything that got any kind of drivetrain in it. It's an opportunity for a gear so long. Is it almost Limitless number of of opportunities for for power transmission? I don't know that we're and all of them have very good margins, you know, it's not about the what you know, once you get out of the this very small gears. I don't want to say it doesn't matter but we're we're focused what we're doing is focusing on regions at a time and establishing.

a couple of hundred square mile radius around places where we've got sales people located in it and and

A representative that are working with us closely. So, you know, I don't know that we have any particular industry that we have to have our same people doing are doing is reaching out in a particular region. And you know, there may be particular kinds of businesses in that region that predominate for example in the Pennsylvania area. There's a lot of mining business and in in you know, the West Virginia area them, you know something else so it it's kind of almost reasonably specific. So once we've got a sales person in a region they go and see what's out there. So I would say that we're focused on a particular application cuz there's so many really good ones. But there's a lot of opportunities I will say this that it's better but they're dead.

Bill a fair amount of limitation on you know, where we can visit people still don't want many many vet potential customers don't want visitors. So we had to conduct resume calls and phone calls and what not. But given the what you're trying to do here a visit makes a big difference getting an engineer would sit down with another engineer with a with a gear box in front of them and talk through the details of how you know, how they want it made or remade or reverse-engineered. It really isn't any replacement for sitting in front of somebody but having said that we're actually pretty happy with the results. We're getting in the positive feedback. We're getting we're back where we do this. Yeah. It seems like in certain areas, but certain Geographic areas. They're more willing to see us and see customers. Yep.

For asking to customers, but for the most part they're very very very very reluctant to do that yet opening it up.

Uh and space in specifics. That's not my PPG but I'll get you next question now and it was space is absolutely not allowing visitors the most part wage in the main, All right sticking to the ptg before I move onto Aerospace. So when you describe an increase in order in sales activity log, what is the the typical time Horizon from getting an order to the product hitting the revenue stream and the cash flow generation stream and in and in terms of your sales activity when you when you talk about a sales activity and you talking about like booked wage, um, you know, these These are booked revenues already for the first two months compared to twenty $20.

I'm not sure how much understand the question and maybe you could

Okay, so, you know I only can go off of what you have in the press release there is no, you know yet but you you know, we missing an increase in order in sales activity off, you know in when Boeing gets an order that is like multiple months. If not a year or more before it actually hits the revenue stream because it's the production cycle of what they're making you guys are making gears or designing or doing something. So when you get an order and you have order activity and sales activity, I'm just trying to understand the typical time Horizon when that quote activity results in and becomes a reportable revenues in product shipment.

I would say, you know could be as short as four weeks could be as long as three months. It depends on the complexity of what's being ordered if it's a reorder birth of a a

A current customer that just goes right into the production Q. There's a lot of not a lot of engineering involved. But you know if we've got to do some engineering and depending on the complexity.

You know, we could go back and forth with the customer a few times where where that could lead to three months between the between an order and delivery. But if it's current account would say it's just a fast as we can get it into the production Q which could be as quick as for a week and and for the activity to have warranted inclusion in your press release to talk about what we got in Christ order in sales activity of these mostly reorders or are these uh, a mix which includes engineering and design type of activities. Yep. It's all the above. It's it's not a little better. Okay? Okay, and you also described it's not really an industry issue. It's more of what's in the package. Remember your sales force or independent reps Etc are if you consider the United States as of you know, a full light off.

How much of the country is there really white space?

You're not you know, originally represented and and and about what portion or are there particular geographies where you're well represented to get a feel for thousand reasons you are in and the reasons you could expand to.

You got you were very strong east of the Mississippi were very strong in the Northeast. We're strong in the midwest. We're song in the Southeast. We are building representation in the southwest and I would say the Northwest and the far west is where we offer. We don't really have a whole lot going on yet and they're you know, it's not like you're shipping cement. There are really no major barriers for you to eventually grow in South West Coast.

That's correct. That's correct. Just trying to understand, you know, the nature of this new acquisition in business ethics evolving to become kind of a reportable sub-segments wage. All right, now moving onto Aerospace which impacts both high-tech as well as Florida pneumatic, but being inside of Florida pneumatic or not kind of focused maybe on the Aerospace their money flowing got the 737 Lee approved. They are you know talking about a very slow Lee ramp. I'm not getting to see some orders literally new orders for 737s. And of course it's being well-publicized how there are crowds at the Dead.

Order ready and airlines are experiencing increased, uh bookings. And of course that have gotten some serious. Uh, what are what can you give us an update a little bit more or a little more clarity obviously than the one or two sentences in a press release as to I guess visibility on and timing of your order of activity in the Aerospace side, which obviously is going to be on the lag in and I'm talking about a few months leg multiple orders light-years like or are you already seeing green shoots?

Yeah, and you know, we we leave this stuff pretty much all the time to leave me everything that you read. It's not like Boeing calls us and give us updates. It's not like I'm I'm just going to point out to you that the 737 orders. I tried to increase to them that mind you they have over two hundred. I think it's too early if I heard about 230 built planes and inventory build planes. And so they've got to sell a very large portion of that 230 plays at a book bag sitting in the desert somewhere. I've seen pictures of it. I remember exactly where it is, Joe can maybe tell you and you may remember but in Arizona there I was gonna okay. So there there's an until until that that gets depleted. We're not going to see anyone It's the Speaker of trying to do with with 7:37 or for that amount of the 787 wage.

and we we do get the

Do get orders from Boeing for the other factories for the planes, but it's it's a it's a it's a drop in the bucket compared to what we would get if they were, you know, doing their normal business on 737 wall. So we're optimistic that it's a great plane. And then now that it's it's gotten over it's it's a a bad press and everything that yet plus later. We are optimistic that being such a good product or the time it'll get better was thinking more like the second half of the year at this and maybe the fourth quarter of the year at that's what module it could be very wrong. I mean they can get a whole lot of orders from some airlines American or Delta or something like that and things concerned about that right now that's going to be my picture you have anything different to say to them. I mean right now we let me what we're hearing and if you follow the analysts, I don't see Boeing ramping up wage.

Action until towards the back half of the year and into next year. So I wouldn't imagine on the commercial side. We're going to see much until 6 to 3 or 4. Right right as an additional reminder for a question.

Okay. And are you in are you seeing any are you gaining access to approval on you must be inspecting to do any additional or new military programs. The answer is yes, Joe. You can give me some information on that. I guess I'm not I'm going to yeah, we're

We're working with several military manufacturers on on products that we've been developing with them. I mean, I wouldn't say they're necessarily by program. You know, these products are something you could use across multiple platforms. So it doesn't happen the F-35 or whatever but it's it's more specific to you know applications that run across platforms. And what is this is this month will call it like a a new line of work or a new product offerings for p&f that had not previously existed.

yeah, we we had introduced a

I'll call it an application tool that was very popular for military applications kind of just as the pandemic was was kicking into full gear. So we haven't really gotten the full benefit of our of our work there but I would say military is probably going to open up faster than commercial production because the demand is is already there, you know, you don't have to wait for the the man to come from the you know people to get in, you know at the airport. So Thursday, we will see that we are seeing that but again, it's still it's it's also contingent about contingent upon these military manufacturers getting into full production, which they're not yet dead.

right now

Obviously Europe is having another wave travel to Europe in and European sales initiatives. She referred in your press release are certainly off further delayed from the opening and like what we're experiencing the United States. You had not been into Airbus before and it has been and effort. Have you been able to make any progress in in in in the in into the Airbus acceptance or approval process etcetera during this period of maintains distance and non physical presence or does it all have to wait until reopening?

Yeah, if we really have not Joe it has to wait. We can't we had visit scheduled we had tools to show them. They're not really there nobody home cuz I'm not really good with this that they got to handle things and pull up and see things and so we have to wait but they are they we were told by people in here unless they've got their own know the point that it should be getting better soon. Germany was going on a lockdown. Uh, we can just they retracted that I don't know if you got that yesterday or the day before I contacted it now cuz it was such a push back and the population. Uh, so hopefully that'll help you know in the AstraZeneca is is is reopened. So, yep.

The more successful you have with the vaccine like in America, but that the quicker we'll have a bar attached to a couple of months ago at best right and and does this hindrance off of um, and the need for physical presence for Aerospace like tools. Does it extend to the progress you were developing for aircat tools and home opportunities in Europe, or is that something that you have made progress on a could make progress on Wild Things still remain? It's just like

Yeah, we did make some progress here, but it's still it's it's slow. It's it's a challenging time for everybody because of the businesses of course, and you know that kind of thing so

Okay, I'll back out again. I have questions on high-tech as well as Florida pneumatic to come back to me when I'm no one else in the queue.

And an additional reminder to the audience, please, press star one on your telephone keypad to ask a question. Once again, that is star one if you would like to ask a question.

Orlando any other questions

currently there are no other questions, but again that is star one. If you'd like to ask a question, I believe there should be another question so I can come back in June and Mister Shapiro, please press star one if you do have additional questions, but again to the audience you can also press star one as well.

And once again Mister Shapiro. If you do have additional questions, please press star one at this time.

You may have this connection, but he announced that he have a question. So we'll give it a couple of more minutes if we can get him on then we'll just have to complete the call disconnected.

And in the meantime, once again to the general audience, please press star one. If you do have a question, once again, that is star one if you have a question.

Okay, we're going to we're not going to stay on this quote everybody on the call if you can't get back in and can't get back in.

Yep, we're going to give it another two minutes, but if we can I don't want to make everybody else.

Yep.

Is there a limit you have a number? I think I have a cell number.

So he just has to be joined. Let me open this lineup. One moment, please.

Hi guys. Sorry, please go ahead Thursday we but we don't have visions everybody. So so I ask you a question for you. So you don't get disconnected and then answer the questions I could be loan. Uh, do you you trying to get clarified you have you applied for forgiveness? And they have a certain time limit for too long to do that to you. Can you provide the timing of when you submitted the application and when you believe you will have your loan forgiven?

We we applied about a month ago especially would be five weeks ago or something along those lines and we have been told weve been told that no more public companies over the other over a two million dollar threshold have heard any response at all. And all we can do is over there. They got we got receipt from them that they received it and took her hands anything else to say, they haven't given any notice that they're going to you know, look at things more closely other than what you've submitted in your app. No nothing wrong because nothing seems to a receipt receipt of it. Okay, so and and when you are forgiven on Thursday or all of this amount that forgiveness of a loan needs to hit your Gap financials in some place Joe.

What do you anticipate to be the where you'll be booking this would this be considered other income? Is it going to be a reduction of sg&a? How how do you block incoming?

Okay, I'll be other income and does the company have a taxi owner. I would think it has accumulated as a result of this last year's losses that were then pretty much dropped an entire other income number to the bottom line.

Well be there'll be a tax. They'll be yes we have in a while. We filed for a refund. We expect them will be filing for a refund and we would expect to get some sort of refund in later in the year.

Right, but with respect to other income to be booked on a loan forgiveness is the nll. What what was the year end in l l size? And and well I don't I can't speak to the well exactly but I can tell you that we expect a a high a high six-figure refund.

Okay, and does that mean then the other income number that will come in on the Forgiveness of the loan will be down for that purpose has be be taxed and the net effect will be your after tax rate on that other income or will there be still continued Dental offset which drops the entire other income line from the Forgiveness straight to the bottom line?

Well, the the the refund will end up as a you know attacks pickup. It doesn't show up as other income. The forgiveness is other income. I can't I'm not going to get it, you know.

You know, we're still not having a great year, so I can't tell you exactly where we're going to end up tax-wise. But you know that you're right. There's a tax effect. It's it's not a tax the

The refund the forgiveness is a taxable event having said that we were able to let me back up. The forgiveness is not a taxable event. There was talk that the expenses that were going to be associated with calculating the refund. We're going to be not tax-deductible that obviously not obviously but that change so those are tax. So at the end of the day, it's not it's a non-taxable game now. I'm don't quote me exactly how we're going to handle that with respect to deferred taxes and all that but we will get whatever the we it's a two point nine billion dollar loan and hopefully forgiveness and that's how much we're going to end up with faith now, so it's almost a dollar a share that drops to the bottom line a little less. Yeah. Yep.

Wouldn't be counting that it's it's that we don't have a crystal ball. This is it out of our control. You may get two million. You just don't know when we get it home and payroll expenses. They're certainly a calculation on increased payroll reduce payroll yada yada yada all the things now when you applied for forgiveness though, you did you submitted a request for and and and support for forgiveness of the entire loan.

We did we did.

Payment is required that everything is required and you can't you can't answer my questions that we hear from you guys. It's out of our control.

When you apply for your forgiveness you apply for a certain amount based on what you ended up doing in terms of payroll and everything else in your application for forgiveness. Did you apply for or giving us at the entire amount? I don't I don't think that's something really really can't discuss but whatever whatever we apply for we'll open again. I don't want to be you know elusive about but we can't get into specifics agent told us not to get into any more specifics about when it comes up will let you know more like everybody else exactly what it is and we're very very hopeful that it's going to be a very sad remember the computer.

All right, whatever. I understand why can't get anymore money in in our attempt cuz it's not easy. You don't break out the fourth quarter, you know attempting determining the fourth quarter for your division wage by taking the full fiscal year and taking out the nine months ten Q numbers, which we do have cuz we don't even have the same K. It looks like high-tech had a negative gross margin for the fourth quarter.

And I wanted to get a feel for if you can is to you know, how much of that number is. Not much of a 244s gross. I mean cost of goods sold. It's a non-cash item and to determine and understand when a high-tech on a gross profit basis whether it was losing money during the fourth quarter from them just this, you know the production and sales of its products.

It's a little it's a little complicated to explain it to my knowledge.

The the the the margin generate in Q4 is substantially related to operations. I don't have it in front of me, but

they're they're certainly they're always adjustments. We make the inventory and evaluations in the the the reserve. So I'm sure there's plenty of that in there, but it's really affect the issue of the lack of

Sales and the lack of overhead absorption. That's the primary thing that's going on in Q4. So overhead absorption really is a non-cash item when it comes to gross profit clearly. It's you know, it's it's a cost cost item that we're trying to amortize over but the products aren't going on with the products aren't going out the door at some kind of lost to cost of production other than the overhead absorption said, right? Yeah, where we at, we're not there's no fire sales office on on product to to get to generate Revenue. That's not what's happening and and there was no notable inventory warmer or other kinds of non cash reserves that also impacted cost of goods sold versus prior quarter can't forget no significant warranty issues or even touring

Other issues relative to you know, prior quarters. I know you do it every quarter you have stuff but

I don't I don't recall specifically what the inventory Reserve adjustments from the quarter. I mean sometimes those are just those are clean cleaned off every at the end of every quarter so

Again, the the the headline is lack of sales and lack of absorption and terms of lack of choice sales again backing up doing our best here backing out and trying to create fourth quarter so we can compare it to third quarter. It looks like sequentially from September quarter back to the December quarter. There was a meaningful reduction in the revenue streams generated from the power transmission group sub-sector off. Can you clarify and discuss a little bit what that's attributable to?

Well in General Andrew Q4.

In a several of our sectors is always worse. It just is high Texas legal issue. I'm well on the Florida pneumatic side Aerospace those guys shut down for a couple of weeks. So that's to be expected from the high-tech side. It is quite common that Q4 is dead or Worse court or even in a good year. So, I don't know how many I don't know that I would draw conclusions from conclusions from Q3 to Q4 Revenue change and power transmission Group, which is a new group. There is no prior used constables for us to to see the seasonality swing all we could see was that last September quarter the third quarter it about a million in Revenue.

A triple-double to ptg in this quarter again reverse-engineering year-end full year -9 months.

It looks like you did about five hundred and fifty thousand and so that was a sizable drop. I don't have the prior-year to go by but so you're saying that in the power transmission group, we should expect to see going forward is a a headwind in every 2 4 versus Q3. Yeah, I would say in general unless we're able to secure a job fair amount of growth to get out in front of that. And you know, we're doing our best to grow it. But yes, that is true right now. You did say that Aerospace similarly has that now back then I don't have your broke out. We're you provided fourth quarter doing year year annual numbers -9 numbers in Thursday, the September quarter you get about one point three million in Aerospace sector sales inside of Florida pneumatic, but it looks like you've been about two point two. Yep.

About a million bucks in December in terms of reported Revenue in Aerospace. So was there anything in particular that you attributed that too, especially since you feel that fourth quarters a headwind seasonal quarter for Aerospace normally?

I would say it's not a trivial to anything assuming your math is correct, which I haven't checked but there was no no discernible improvement in our expectations between Q3 and Q4 and Aerospace. Ya I need ya here over here. No, no doubt. It was just it was up fairly. Yeah. I I don't think I don't know the respect. I don't think your numbers are correct. Thank you your check it out and it will be able to somehow get the answer to you, but I don't I don't think that's correct at all. Okay, but we'll get off.

No industrial catalog similarly dropped in the fourth quarter versus the September quarter and historically that has not seen the sequential seasonality declined from you know, my multiple years of that sub-sector. When you bring things out, was there anything in particular that impact the Industrial slash catalog for Florida pneumatic for the fourth quarter? It's the ups and downs of the market with the with Colgate and everything else that goes with it. It's it's all it is a very very spotty throughout the year. I don't I wouldn't attribute there's no systematic reason. I can think of the Q4 was forced into three authors. Then I think the fits and starts of being in the middle of this pandemic are going to generate some nonsensical sequential changes in Revenue. That's all I can really tell you dead.

Right, that's correct.

Okay, that's dangerous but it's not even close so you can have days and weeks of changed dramatically just like that for me for example is the price of oil from $55 a barrel to Thursday in the snap of a finger three days. So, I mean it's it's it's it's just the stuff it just happens, you know in Washington decide they want to do something it affects everything going down the line. So, yep. Yeah, that's a big spike in oil or moving oil doesn't generally, you know move the needle for you guys one way or another that quickly. Well, it's if there's no damage to the higher price price includes will get more business and we've seen some of that but you know, it can go the other way also but it's my point is you cannot you cannot you cannot

Like in the past how things are is this? No way to predict what's going on in the world right now. So we we look at it every day and talked about it every day and as we see it off cuz you have to wait to it. Right and here we are, you know mid-march, we've had you know a decent amount of time when there has been around up in New York mentioned that are you seeing increased order activity and coming from the oil and gas sector ready as a result whether it's as a result of the higher prices or wage things are just bond out and they block lost and need to replace the tools. Are you seeing any increase in stabilization there?

Not stabilization and sooner increased but not enough to really notice, you know, not not dramatically to the company, but you know, it's not a big dog. It's not not like changing by any means. Yeah and with respect to Home Depot which you know as a large retail customer on your selling that product, you know, direct consumer-facing and all that that's generally been a a lower margin of product or SEC sub-sector for you versus what they Aerospace inside of Florida pneumatic seasonally. Do you have feedback about how your new products that were introduced you? I guess now a year ago about how they fared in terms of sell-through and and results to Home Depot here in the their big fourth-quarter, which name?

King cuz you're bigger third quarter to know about their need for a restocking and uh new orders, etc for home coming year.

Yeah, again, they're they're up and down as well and they were unpredictable and you know, we're basically doing better than my customers for the most part. So are you from a year has been I would say essentially essentially flat to slightly embarrassed and not write down. Yeah. I mean, the only thing that's doing recently while there are the spray guns the other the other lines are the other excuse or actually doing a little bit worse.

Okay, it has a spray gun increase offset the headwinds of the other excuse it has it has took which is my point and I keep saying to you so you understand that's along the way more question.

Okay. All right. I think that maybe the end of my questions other than again to ask that your advisers who tell you I understand. You don't have to break the fourth quarter. But your advisor just telling you all these other companies don't break out. Their fourth-quarter is to perhaps revisit that and and me research that and maybe just come back in 2021 fourth-quarter. You would indeed help your shareholders.

analyze

And be able to discern things the wheeler emails, you're only a small company and you're not getting you know, this isn't that way to help attract him with coverage or Thursday and investor interest. So if it's better to make things easier for the shareholders and prospective investors, okay. Thank you and have a good day to have a great lakes there any other questions?

There are no questions in the queue.

Okay. Thank you all for your time today, and we look forward to speaking to you with our numbers. I believe it's in my so I will be in touch and let you know exactly. Thank you and have a good day.

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