Q1 2021 P&F Industries Inc Earnings Call
Good day and welcome to the P&L the industries incorporated Q1, 2021 earnings call. Today's conference is being recorded at this time I would like to turn the conference over to Richard Goodman, The Companys General Counsel. Please go ahead.
Thank you operator.
Good morning, and welcome to Peanuts Industries first quarter 2021 conference call with.
With us today from management are Richard Horowitz, Chairman, President and Chief Executive Officer, and Joseph Molino, Chief Operating Officer, and Chief Financial Officer.
Before we get started I'd like to remind you of that any forward looking statements discussed on today's call by our management, including those related to the company's future performance and outlook of based upon the company's historical performance and current plans estimates and expectations, which are subject to various risks and uncertainties, including but not limited to risks.
Added to the global operating of COVID-19, and other public health crises exposure to fluctuations of energy prices debt and debt service requirements borrowing on compliance with covenants under our credit facility.
Disruption of the global capital on credit markets, the strength of the retail economy in the U S and abroad risks associated with the sourcing from overseas importation delays of customer concentration.
And of long lived assets and goodwill unforeseen inventory adjustments for changes in purchasing patterns market acceptance of products acquisition of the 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 can.
Mission, including among others as described in the most recent annual report on form 10-K quarterly reports on form 10-Q, and our other.
The filings as well as in today's press release.
These risks could cause the companys actual results for future periods of differ materially from those expressed in any forward looking statements made by the.
For 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 any forward looking statements whether as a result of new information future developments or otherwise and with that I would now like to turn the call over to Richard Horowitz Good morning, Richard.
Good morning, Rich and thank you and good morning, everybody Hope all is well. Thank you all for joining US this morning to discuss our first quarter 2021 results.
Hope on all of you we're doing well on that he has continually difficult circumstances in the world.
Although the vaccine rollout, which will help control of the CIT deadly diseases on the way we.
We are still working diligently to get past the hard harsh ethics of this global pandemic.
Our thoughts and prayers are with all of those affected by COVID-19 and their families.
I would like the direct your attention to the company's press release that was released earlier today, which includes the Companys March 31, 'twenty, one 2020, one excuse me balance sheet. The statement of operations statements of cash flows and discussions related to the company's first quarter 2021 results of operations and have of compared to the same period last year we.
Believed this release should answer many of your questions in order to make better use of everyones time here today.
Please be mindful of the purpose of this conference call I would like to note. The following two items as I always do first as we have done for several conference calls and it's become a standard of practice, we will move directly to a question and answer session and not restate, which is already in this morning's release and secondly, please be aware of we will only be answering questions directly relating to the companys for.
Also of operations and financial condition in Q1, we must insist that you would hear for this procedure management will not be to entertain any questions that you don't go beyond the scope of this cool.
And with that we would be happy to answer any pertinent questions anybody has this morning operator.
Thank you if you would like to ask a question. Please signal of by pressing star one on your telephone keypad, if you're using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment.
Again star one to ask a question we will pause for just a moment to allow everyone the opportunity to signal.
Yeah.
Our first question is coming from Andrew Shapiro with Mondale capital. Please go ahead.
Hi, Thank you I have several questions I'll ask of feelings and come back out into the queue.
Trying to understand the kind of where we stand here with.
The ramping things back up as we come out of the pandemic for all of the first quarter.
Up to the end of March was the company able to conduct any onsite visits with current or prospective customers at the up to that point yet.
We have we have had some of.
Personal visits but not anywhere near as many of US we would like especially in our gear the company.
Which is more on the north east, but the and with Boeing They really just started doing it in a very limited way.
So really not much I mean, we've got a little bit here on air Angela but not a lot.
So so I'm not sure of you heard my question correct.
Clearly because ive been trying to to pay for this and understand you've reported your first quarter results.
For the end of March up to the end of March had you been able to make those visits because you know the availability of the vaccine really started the started to you not only get wide near the end of the quarter and so people weren't even fully vaccinated until maybe after so these ramp up.
The site visits Youre discussing did they start taking place after the end of the first quarter and in like the last few months only or.
I mean, it's I'm not I'm a little healthier.
Timing of it but I would I'm I'm gonna at St. Joe can correct me if I'm wrong.
The the majority of it has been in the second quarter partial pill.
But partially okay.
Starting on the first quarter, but not much okay.
And the debt.
Go ahead of the.
Go on Joe.
And Europe Continental Europe, we've been able to not travel and visit any customers at all.
Oh, Yeah, yeah, no that I that I understood, but things.
Things are opening up here and I was wondering if you were getting to start to see the benefits of that and if the first quarters.
Rebound reflected that but it sounds like the first quarter's rebound was pretty much independent.
Of the effects of any for any of them on new sales activity.
In what month exactly did the company submitted its application for forgiveness of hits 3 million dollar P. P. P loan and what is the status of debt forgiveness.
We I'll, let I'll, let Joe give you the more details, but we submitted the as we said at all of last conference call of Nothing's changed we submitted the timely and of.
Tommy matter of it properly and the spin in there.
For I'm Gonna guests 90 days of more.
We've tried to reach out to them and it's like talking to a wall for the most part but go ahead. Joe you can give more color we submitted our application at the end of.
January.
And then there was as you probably read a follow on questionnaire that was required to be completed.
Which was done in early February.
In both instances, where we're depending on when the call. We're not sure of the clock started at the first insurance of one we completed the questionnaire, but we're past the 90 day point, which at one point. We were told was the deadline for the SBA to.
First the response of the allowance but.
They have basically have not done that and have not indicated when they will.
Right now in in light of the size of this and the impact it would have to the income statement should you received formal notification of the forgiveness of the loan.
Would you be issuing a press release and an 8-K.
The announcing that or would we have to wait all the way until August for the second quarter's earnings results to see this.
I would refer to rich on that but yeah.
You know certainly it's a significant event, we'll do whatever is required but yeah, well definitely I'll start of course with.
Well the people, we will definitely consider that and I would think it would be something that we would do unless the law of styles, we can't do it but I can't tell you, but we'll definitely consider that.
Usually the lawyers you know usually the lawyers don't prohibits such kind of disclosure I have isn't that material.
The inside okay.
I have other questions on the operations. Please come on come back to me, but now I'll back out into the queue.
Okay.
Yeah.
Thank you and again, if you would like to ask the question press the star one now.
Yeah.
And we will go again to Andrew Shapiro. Please go ahead.
Great Thanks and.
In light of our picking up travel again by the way and and and work force feeling comfortable about doing this on more concerned about your marketing and sales force, but I'm sure your engineers do it too.
Do you have an estimate of the percentage of the work force presently vaccinated with one shot or fully vaccinated and are you considering any financial incentives for bonus for employees to get them vaccinated.
And Joe you can answer that.
We don't have perfect information in that regard, but I would say debt.
Depending on location.
You know, we're probably at half for or more.
We are looking at trying to.
The increase sad and incentivize that as much as possible. So we we are considering our options in terms of trying to get our percentages are as high as as high as possible, but we have not right. We have kind of we don't have a formal policy in that regard yet because it's really only been.
The last few weeks.
On that everyone has had full opportunity.
And when you reconfigured the floors in your work shifts and all of that in order to minimize.
The risks from the spread.
And you had stated in the past that you were on the manufacturing side, you've been able to maintain things. It seems like there was still certain special efforts in things that had to be done when the advent of Oh.
The spread being reduced or the work force being vaccinated and all.
Where there are where their productivity hindrances debt you encountered that you would be reverting back to certain older ways that we're more efficient or more productive or.
Is there not a meaningful difference one way or the other.
Joe.
You know if you were to and actually you probably toward one of our facilities Andrew there isn't enough.
The distance between machines that.
There isn't any meaningful impact on the for as a result of the protocols, we clean of little bit more in and you know there of certain other things, we do but in terms of production.
The real.
Really isn't much of fact now the office space is a little tighter. So we've we're still depending on location.
The alternating days or people are working not every day on the office, but I would say that it had no impact on our ability to accept orders and deliver orders and.
We need to do every day, so I don't anticipate that the vaccine is going to have the vaccines availability and subsequent people getting that done.
To have much effect on our on our ability to function.
Okay.
Respect of Florida pneumatic, while the company's spray gun tools are certainly enjoying year over year increases too.
To what extent if any have you seen year over year increases in other lines of retailer aftermarket automotive tooling.
That's that's the one that's that's really dramatically changed.
The other stuff is I think within the within the normal up and down but the.
The the spray guns continues to be very very.
Hot Hot in the market does the demand.
Yeah on with regard to the other the.
Other tools.
We we are seeing an increase in the automotive tools and I wouldn't say, it's just it's it's it's it's overall and.
You know, we're certainly seeing.
An increase in in the Amazon channel.
But again.
As you may or may not recall.
It was the time there were the other main channel, which.
Which was the distribution such debt.
For being driven around on trucks and trucks for visiting garages. There was the time when that was shut down completely.
That is obviously starting to reverse so we're not 100 per cent sure if.
The Amazon growth, which is fueling an overall growth in air Cat.
For seed in some of those customers will start to return to buying the full from the trough.
Overall.
So there is growth in air cat of year over year.
Okay and can you provide further color in the types of non automotive applications.
For which you referenced.
In the press release, our companies developing.
Cordless models of its tools.
And the prospect of time range in which these products might be introduced by P&L.
So there is a.
One or several aerospace applications and there are several other.
What I'll call industrial.
Heavy duty industrial applications.
Applications, which run across a number of industries could be construction could be.
Infrastructure repair.
Could be.
Heavy duty automotive heavy automotive and truck work.
The oil and gas are things like that.
So we're going down several paths of we actually have.
And automate.
Hey of cordless tool that we're working on and high Tech and of course, the sold that were working on one of the Florida pneumatic.
And.
The introduction.
I don't feel for them, we don't have a hard date, but we're thinking of Q3, yeah I was going to say, we're hopeful that it's this year in time to have a meaningful impact but.
These tools are still underdevelopment.
But where we're moving along as quickly as we can.
And in the development of these tools is there some I T associated with it might the P. N F develop and have some.
On a proprietary asset it's developing here.
I don't know I don't know the answer to that.
Okay.
I would say for the most part we're using off the shelf for someone else's battery Tech.
The development of battery technology is extremely.
Fences [laughter] so.
We decided not to reinvent the wheel.
Okay.
And sticking in Florida, pneumatic, but jumping over it on the aerospace side and the progression of quarterly revenue generation in aerospace.
Is there a traditionally any seasonality in this sub segment of our of the Florida pneumatic and the aerospace there.
Yes.
Joe.
I would say generally no although.
Historically the.
There there definitely is the slowdown in aerospace.
In the back half of December in fact, I think it is sort of industries typical that almost every aerospace manufacturer is closed.
Last week of December and we also typically see a slowdown in orders in general even before that but.
Not sure I would call that seasonality, but other than that I don't I don't think so okay and.
And Moreover, then with respect to aerospace what visibility of Sandy do you have on the anniversary.
Of revenue declines for when we might see to simply of stabilization of the aerospace revenue to prior year levels, because we were.
We saw obviously year over year decline.
In this full pandemic Q1 March 'twenty, one versus we'll call. It a partial pandemic Q1 March 'twenty 'twenty.
Is there any visibility on the anniversarying of of the sub segment's revenue decline that.
You've already seen or you expect to see in the next few months or quarters.
Every every week, we get different information from.
Our aerospace people, specifically Boeing they don't know what the what they're talking about the I wouldn't rely on anything that telling us or anything of doing but right. Now we have seen really nothing of any consequence and changes in that regard.
Joe you want to add anything for that yeah, I mean, I agree I mean, I think that.
In Q2 of 'twenty 'twenty.
Was it was pretty it was pretty much the bottom.
So you know this quarter, we're now in.
Is the anniversary of the bottom.
Yeah, and they can't but they don't give us insight Andrew no not.
In other words more sort of the customers. They don't give us insight as to what's going on they give us states that they don't think things are going to be and then they give us a different day totally unrelated to the first day.
The month later and so we don't we just go ahead with our business, we don't really put any any value into what they tell us because they don't know either.
Okay and I'm just wondering if you understood. The nature of the question I think of it. So that's the I get it okay.
Regarding.
Hi Tech.
And in particular P. T G of the gear products acquisition.
So at high Tech can you explain the timing of the acquisition.
In the <unk>.
Of the of the gear products acquisitions into the integration of the P. T G business and kind of provide some explanation or color.
On the year over year revenue decline.
Reported in P. T G.
This quarter.
And.
And and so we better understand why that is the case and also the kind of on the sidelines on your book of business going forward.
Yeah, well I'll, let Joe the our bookings are good.
Very good actually we are of good backlog, Joe why don't you discuss the compare of comparison, yeah, I mean, the the P. T G business.
You know this quarter a year ago.
We could travel freely and we were really going hard at all of the new customers that we had gained as a result of the Q for acquisitions.
Q1 of the.
2021 we couldn't travel at all.
So that had a significant impact on our ability.
To generate orders, although as we said earlier.
Where we're starting to make some progress.
In that regard.
Hope that the hope that answers your question.
Which we answered before yeah.
Okay, I have more well, let me back out and nobody else connector.
Andrew there's nobody on someone else huh.
Alright, I'll continue on just continued the aren't the continued till the end and then the anybody else will come on the afterwards.
Well I'd hate to the love them to sleep, so less of them.
Yeah.
If nobody else on the debt.
Alright.
Approximately how much is the the company's available tax N O L carryforwards to offset future income.
Joe.
Oh I see.
My math of memory.
Memory serves we are anticipating somewhere between a half a million in the three quarters of the million dollar.
<unk> back from the government sometime later this year.
The what we'll call that the N O L. Although I might my tax people are going to yell at me for calling on an NOL, but that is the well that's the tax that's the tax reform that's a refund of the prior taxes paid where you can do a look back but we've generated some substantial losses over the course of the for lack.
Yourself.
Are you seeing there are the all of those losses have been kind of accounted for and there is no.
Tax shield available for when we returned of this company returns to profitability.
That is what I'm, telling you.
I believe we will be darn close to not having any shields.
That up.
That's my recollection.
But somebody will check that while we're on the call.
Good alright, lets see where I think that we were able to go back.
All the weighted I mean, the law changed a little bit I think we were able to go back to the point, where we had the sizable gain in 2019 due to the sale of the building.
But.
I don't think there's going to be the shields going forward so to the extent of law.
Losses in 'twenty one of those.
I'll have to be.
Forwards, but someone who's going to check that and confirm that right and also as the P. P. P. The.
The P. P. P loan comes in that's debt forgiveness is not taxable according to the IRS guidance now, which isn't that correct. That's correct. That's correct. Okay. So that'll be good too alright.
And.
You know you closed on and you've got this acquisition of the gear businesses, which was all exciting at the time and then.
As you were moving everything over.
The pandemic hit and and to evaluate and to compare and think about the.
The strategic benefits.
And the synergies you had expected or thought of from the acquisition.
That kind of got thrown out the window.
With the disability now of the coming out of this of the.
Pandemics mass vaccinations etcetera, you beginning of the travel your order books building up.
Can you remind us in the elaborate again on the strategic benefits.
All of those those gear businesses and and the.
The synergies.
That Oh, I guess, we should maybe expect expect to see now in the coming year.
For what was acquired and maybe put some numbers around it I can't recall again, what was paid for by both of those businesses and the scope of its revenue stream that was acquired.
Alright, you can use them on yeah.
You know Andrew the the benefit was essentially that we had a work force.
That was capable of.
Taking on.
The acquired activity.
Where they.
But I'll call on efficiently increase.
And the fishing increase in manpower so in other words I'm going to make these numbers up.
Where the acquired businesses may have had.
15 employees required to generate.
You know $3 million in revenue inside of our shop, we probably only needed half of that and obviously less space.
You know less total space between the space, we already had in the space debt that they were using so I can't give you an exact number but I can say that as we grow revenue.
You know from where we are to the to the more.
To be more in line with what our traditional business had and frankly, what the businesses we acquired had.
There will be it for some period of time, a minimal if no change in personnel as we can get more efficient.
Using the machinery that we do have I mean at some point, we're going to need.
For people, but.
You know at some modest level of growth, we actually won't need any more employees.
Can't tell you if that's another half a million of revenue or of millions in revenue, but you'll.
You'll start to see the margin go up because we're going to have a lot of.
Overhead absorption.
As we ramp up and of course will hit the step function change and then we'll have to bring in some more people with growth continues but we've got a little bit more runway here to grow revenue without really increasing.
The the overhead.
Yes to clarify further on the question you guys made you guys made the acquisition.
We're all excited we all seem to have been excited about it and then it was looking on all of a sudden they all hit the wall right with all of this.
And have you what have you seen if anything on that.
It gives you cause to return to having like excitement and and and of takeaway.
You know if you were in the elevator and wanted to spend 30 seconds to tell US you know what.
Why this was a good acquisition and and that of.
This this is going to be a good return on investment.
I would say two reasons one again.
There's nothing magical about.
Increasing revenue and getting a greater return because I'd say just said outside of material.
We have some more runway and personnel and equipment and space.
None of those costs are going to change in the second.
What's probably even more encouraging.
Is that.
The customers that we took on.
Have more.
Here's available.
To be produced for.
For them that are different.
Then the old customers were manufacturing, but within our current capabilities and then it related to that.
Our hit rate on getting in.
In front of of customer that is not a current customer and getting business is.
He is.
Very high.
You know, it's it's it's extremely high so we're confident that.
We can get in front of the customer we will get business.
So that is what gives me those three things give me.
Yeah, and just the add on just the just just to go further on the score that we.
We are having a very very when we do get a customer a potential customer that will see us we have as Joe said very good hit rate.
We're getting all of our customer base is getting broader.
And it's a very good integral of horizontal integration for our for high Tech itself and it's and it helped a lot in terms of absorption of punxsutawney.
Heading of adding okay.
You made reference to and I appreciate it in the press release on specifically that at this time.
The dividend would not get reinstated, but you hadn't been mentioning that before but that it sounds like it is now.
On the agenda for each.
Board meeting is it time to do it is that is that a correct assessment.
The assessment that it's it's in the it's like an agenda item now on and there will be of time in the.
You know foreseeable future the dividend they'll get reinstated.
Andrew I don't know what do you think it's foreseeable future of them, we think of the foreseeable future, but every every board meeting even during the beginning of the pandemic. We discussed it at every single Board meeting and every time, we've had the board calls we've discussed the every so it's really no different than before we've always been discussing any of you continue to discuss it.
And and the company will make the necessary disclosures there from when we do have a dividend and it's it's all I can say to you is you.
We would be we want to have the dividend, but the numbers have to work.
I would have to be there for us to do that.
Right and you analyze the continually as we do.
I don't know if that's answering your question the way you want it.
What do you want to ask kind of a well.
Oh, Yeah, it's partially I mean, if you wanted to tell me what you felt was the foreseeable future of that would then answer the question entirely.
I don't know I don't know I can't do that.
The wells, we will keep you posted when windows of dividends, you'll you'll know like everybody else from them.
Yeah on previous calls pre pandemic you were very actively looking at tool businesses aerospace automotive industrial et cetera.
Can you update us on.
Where in your capital allocation priorities.
Here, where we are now not not post pandemic, but pre post pandemic.
What's the status and focus of your acquisition process is or are you looking are you seeing.
<unk> Ah that have come down and the opportunities that fit within.
You know the company's model of the usually looking for owners that don't have a succession plan who are looking to.
You know monetize their life's work, which probably is flying before there is a lot quicker now that they've gone through of pandemic.
Go ahead Joe.
We're looking we're actively looking.
We've always looked really changed I.
I think well.
Well there are.
People that have that.
It's of well you know we just went through this pandemic and maybe I should be thinking about selling I think you've got the countervailing force of people, saying well, we're not that far from the bottom and I'm not going to sell right now I might want to wait until things improve a little bit.
But yeah, we're out there we're seeing things to look at and we're looking at them.
And then I mean, a lot of pizza.
A lot of people are saying you know before the pre pandemic.
We were at one level and so we expect to be paid at that level still because we will be back there again, and we're not doing that but we are looking actively always.
For the acquisitions.
Okay have you gotten any indication from Airbus at all as to when they will start to take the visits and the tools that you had in mind.
And we're excited to present to them could in fact be presented.
Yeah Andrew.
I Gotcha of we got your email last week I'll just remind you.
Airbus is not a customer of ours essentially now we do a little bit of here and there, but not not to any great value.
So I'm just reminding you of that and we have the right. That's just one.
This is one of them.
Because you had tools you want to put in front of them.
We have we do and we will but there's absolutely no open door at Airbus because they're in Europe essentially.
That's where it starts there.
And we were aware of where we are paying attention to it every day the as soon as they open the doors, we hope to go there, but it'll be of it but in a big company like that just like a big company like Boeing you don't.
It's not the immediate gratification. So we have to manager of our expectations for that but it's definitely on our radar, but they're not they're not up to that point yet.
Okay.
Well you could use for a bunch of what were months away from being able to get into Boeing.
Okay, well that the that's better than quarters.
Pre COVID-19 you spoke.
Pre COVID-19 you spoke of concrete initiatives, beginning to marry up Florida Pneumatics.
<unk> and Hy Tech's resources to go after the aerospace market in the bigger way.
But with the long lead times in the aerospace it could be several quarters before you sign the results.
During the several quarters of COVID-19 and reduce the aerospace activity.
One of you guys done to better position these initiatives to marry up those resources once the market does open up again for you.
We've Uh huh.
We are positioned and we've been positioned and we continue to be positioned in a good way when the when the market opens up.
I don't know if you want of anything more to that but we are off where she.
We're combining resources on product development, we are coordinating the efforts of our European sales person so that.
In their bag of tricks.
They have the full suite of all of Pnm's tools that could service the aerospace so.
That's what we've done so when we can have the visit.
Will arrive with.
I call for P N F complement of tools.
That we are ready to come.
The complete development on for for Airbus and Boeing Yep Yep.
As I said, we have been and we continue to be very well positioned for both.
Okay.
Your press release made no mention of any current shares outstanding number or even the one used for the EPS calculation. So all we kind of have as the prior 10-K to go off of.
Can you provide us the more current outstanding share of fully diluted share count.
Joe.
I don't have that data.
You can get that we can get that for you Andrew.
That in and also the NOL.
A catch up if you can.
Our bedroom, we mentioned there is it just before we go on there's no material difference between the last published data in and as you know when the Q was filed you'll.
You'll have that information in.
What are the eight hours yeah, yeah yeah.
Yeah. It is.
It possible by the way for you guys to ever filed the 10-Q in advance of this call.
We've had those conversations with the lawyers, we've been informed that it is.
Preferred.
To do it on the order we do it but we will we will express that.
Prior to the board and the attorney Yeah.
Okay, I mean, just because of lot of questions.
Come up and you could then the answer them.
You mentioned in the release and obsolete slow moving inventory charge of Hi Tech during the first quarter of 2021 the net flows through on the impacts.
And the gross margin.
And this was a higher charge than the prior of prior years Q1 'twenty 'twenty.
Why was this quarter's of mountain and how much of an increase wasn't over the prior year.
And is there and the mounting this bucket that you feel is non recurring type of charge.
I don't have the the the number I don't remember it being particularly material I don't have it in front of me, but one thing that you have to remember.
The weighted or.
Inventory reserve model kind of works is.
It's it's just not a subjective well what we feel like doing it starts with an activity level.
And so what.
As you can imagine.
As we start the activity starts to dry up.
We are our initial.
The reserve.
Needs to grow.
Because again, it's driven by activity activities down.
Other things being equal the reserve needs to go up that's kind of where we start so as we enter a pandemic or a recession.
It is mathematically unavoidable debt, where we are you know we increased the reserves and then as we come out of a recession.
The same tools as the activity levels the increase in relation of the amount of inventory there the reserves reverse so.
The answer your question, yes. Some of it is time for I would imagine some of it is temporary.
Sure, it's not all of that for sure.
So it's in terms of momentum impact on.
Our gross profits.
It should come out.
The charges reduced only.
Finding even further.
The growth in the gross profit.
And the same as we're experiencing now is it's a headwind on the gross profit because things are slow.
That's correct.
Okay.
And again I don't want you to think it's all of a formula that's that is the that's where we start and then we then we drill down further and look at individual.
Families of tools in the special circumstances, and whatnot by somebody some judgment, but we do start with the calculation.
Yeah.
Are there.
Any particular.
Gains or or items in your OEM engineered solutions in particular for any industries of products worthy of a call out and for example, also you had mentioned on prior calls the new line of ATP Magnum Force industrial air impact tools.
And I was just wondering if there.
If there was any meaningful success of acceptance of of such a product that has come to pass on.
Or is the.
Pandemics.
And economic slowdown cloud at all of that.
Gotcha.
We've been very happy with the Magnum force reception and.
And I would say, especially in the last.
90 days.
It seems to have really taken off.
With the few customers that have a fairly well.
Wide.
<unk>.
And user base.
Yeah, well I would say, where we're meeting some success with that with that new offering.
Yeah.
And is there any other things from the OEM engineered solutions area.
In particular areas of industries of products worthy of any callout of elaboration.
Now what I would say only because we haven't been able to get to see people again.
Yeah, that's been a little bit of a holding pattern. As a result, you know we had the same issue there we have with P. T G.
Okay.
In view of the Amazon Route, which you've said are cat's been really doing really well.
Do you of any visibility or do you have any idea how much if any of the of the Amazon product is going overseas, where you would otherwise have been having difficulties with the distribution.
Not to my knowledge I don't think we of any visibility with that Joe you of any of those.
Not that I'm on to my knowledge either in the partial for gas I would say none of it is going overseas.
Okay.
Alright.
Well the gist of poses he gets the greater opportunity for when Europe comes out of this as well.
Okay.
I think that's it I will back out thank you.
Andrew just to answer one of your questions.
We have taken full advantage of the NOL for the federal NOL carry backs, there's no opportunity for further carry backs and as you may or may not recall, we have a fairly large state NOL.
Most of that is in the state of Virginia. So you know unless we open up a subsidiary of there and start generating profits.
Those will not be able to help.
Help us Oh, Yeah, you can't you can't utilize those of the fed the federal side of the law.
Losses, you've been generating of late.
Those have been or are being compensated for already yeah.
Correct.
Okay.
Well for cash flow, that's better but.
Oh on future profits will be fully taxed.
Except for the PPP loan.
Alright.
Thank you for your time Andrew.
Thank you and as the final reminder, to our audience you may ask a question by pressing star one.
Yeah.
And with no further questions in queue I will turn the conference back to the company for any final remarks.
Thank you all for being on the call with us today.
We look forward to.
A good year.
We're very optimistic that we're gonna have a good year for those things continue on the road that they are with.
The world in the country.
Stay well, everybody and well speak soon.
Thank you operator.
This concludes today's conference. Thank you for your participation you may now disconnect.
[music].
Thank you.
[music] zone.