Q4 2021 P&F Industries Inc Earnings Call

You are currently on hold for today's P. N. S Industries, Inc. 2021 earnings call. At this time, we are assembling today's audience and plan to be underway. Shortly we appreciate your patience and please remain on the line.

[music].

Good day and welcome to the Pea enough Industries, Inc. 2021 earnings call.

Today's conference is being recorded at this time I would like to turn the conference over to Mr. Richard Goodman, The Companys General Counsel. Please go ahead Sir.

Thank you operator, good morning, and welcome to Peanuts industries full year 2021 conference call 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 that any forward looking statements discussed on today's call by our management, including those related to the company's future performance and outlook based upon the Companys historical performance.

Current plans estimates and expectations, which are subject to various risks and uncertainties, including but not limited to risks related to the global outbreak of COVID-19, and other public health crises risks associated with sourcing from overseas disruption in the global capital and credit markets importation delays customer concentration unforeseen.

Inventory adjustments or changes in purchasing patterns market acceptance of products competition price reductions.

Bose your fluctuations in energy prices.

Think of the retail economy in the U S and abroad risks associated with Brexit adverse changes in currency exchange rates.

Interest rates debt and debt service requirements borrowing and compliance with all start with covenants under our credit facility impairment of long lived assets and goodwill retention of key personnel acquisition of businesses regulatory environment litigation and insurance the threat of terrorism and related political instability and economic.

Certainty and business disruptions or other costs associated with information technology cyber attacks system implementations data privacy or catastrophic losses.

Other risks and uncertainties described in the reports and statements filed by the company with the SEC, including among others as described in our most recent annual report on Form 10-K , our quarterly reports on Form 10-Q , and our other filings. These risks could cause the company's actual results for future periods to differ materially from those expressed in any forward looking statements made by or on behalf of.

The company forward looking statements speak only as of the date on which they're 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 all so much for being on the call with us today and joining us for peanuts results for the full year of 2021 .

I hope all of you are doing well as a country in the world are trying to exit the ill effects of the global pandemic.

So what's and prayers go out to those who have lost loved ones due to this deadly disease.

Further our thoughts and prayers go out to the victims of the current crisis occurring in the Ukraine may soon.

Soon come to a peaceful solution.

During 2021 peanuts continue to encounter the effects of the COVID-19 global pandemic.

The areas in 2020 , one most affected were the inability or extreme limitation of our sales force, which was when they encounter there episode gain on site product presentations, which in particular hampered the growth of our P. T. G. R gears business.

The supply chain disruptions, which caused major delays in receipt of much needed inventories as we all see everyday in the newspapers.

Lastly, the exists excessive costs incurred in connection with the supply chain delays.

I would like to direct you to your attention to the company's press release that was released earlier today, which includes the company's December 31, 2021 balance sheet statement of operations statements of cash flows and discussion related to the company's results for full year 2021 and how they compare to the full year 2020.

In order to make better use of everyones time today, you have to be mindful of the purpose of this conference call I would like to remind all of you of the following procedures that have been in place for quite some time now.

First as we have done for several previous conference calls it has become a standard practice, we will move directly to a question and answer session and not risk that restate what is already in this morning's release.

Secondly, please be aware that we will only be answering questions directly related to the company's results of operations and financial condition. We must insist that you would hit to this procedure management will not be entertaining any questions that go beyond the scope of this call.

And then with that we would be happy to answer any pertinent questions anybody may have operator, you can open up the question line.

Thank you and if you would like to ask a question. Please signal 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 press Star one to ask a question.

Well go to our first question from Andrew Shapiro with Lawndale capital management.

Hi can you hear me Okay, Yes, we hear you fine.

Awesome.

I have to it's unfortunate, but every fourth quarter I kind of have to ask this you know your board of directors I'm sure you guys prepare for them.

The results for the fourth quarter ended December in addition to the annual but your press release.

Repeatedly each fourth quarter doesn't include that breakout in it.

I don't understand why you can't provide that to shareholders as well in your press release and I respectfully ask you guys did do that going forward, but of course, we'll wait three more quarters to get.

The same you know.

Is there a reason you can't or you don't provide the fourth quarter numbers.

Andrew it's not required it's certainly a lot of extra work and by the way, we don't prepare or something like that for the board of directors to my knowledge.

Your board does not want to look at how the quarters performance is when they have their quarterly meeting.

Triple net we look at the whole year and they can do math if they'd like.

So you make them do the same reverse engineering that we have to do as shareholders is that correct.

They're more concerned about the full year results.

Okay.

Moving on to the questions from what I could see.

Hum.

A few questions regarding the kind of the COVID-19 impacts to know where things stand.

This last quarter as well as where we stand now here in <unk>.

At the end of March another full three months after.

What part of the quarter. If any were you able finally to conduct onsite visits with current or prospective customers for high Tech P. T G as well as your existing North American aerospace like Boeing and its suppliers as well as prospective overseas aerospace customers like Airbus.

You cited in your debt, there's still difficulties, but.

To any extent that the fourth quarter were you able to conduct any onsite visits and in either of those two I guess industry groups and then customer groups.

It was very very sporadic very sporadic and it would dependent it dependent on the area that the company was in the geographic location of it and what their Covid case load was like at that time bowling specifically really did not does not did not go bill it does not take customers.

And there is too much.

Theoretically we can in the Airbus has not opened up yet, but theyre momentarily claim they're going today.

Okay, and then on P T G, where you're able to get into some are not.

Yeah, we've got and we got into some customers and the other question was I couldnt get into it was it was very sporadic nothing okay.

Yes, and and and then from the end of the year fourth quarter.

And basically until this week basically much of the first quarter have things improved further.

They've improved I would say slightly but.

But not if you're referring to Boeing and Airbus The answer's no really.

The others, you know, we're seeing customers, but now with the new omicron variance that that seems to be gaining a lot of steam in Europe and other places.

Becoming a.

It's on everybody's mind again, sorry.

Sorry, that's right.

Okay, because it's been pretty highly publicized held.

While Boeing is nowhere near the production rate they.

We were at before the 737 grounding.

That the production rates have.

Greatly scaled up and are scaling up and that there has been publicity about how boeing needs.

Need to suppliers and others to step up and there's concerns whether they can so.

With that kind of sentiment.

Are you seeing green shoots with respect to them wanting.

To get its tenders and youre pretty much like a supplier to vendors you're supplying tools youre not really supplying the airframes themselves but are are they.

Are they.

Are they giving indications of opening up our wanting you to start focusing on being ready to supply them.

First of all our our people who are on the ground there.

And how much or where in the factory are saying that the numbers that are being released publicly we just heard this last week are not even close to what they actually are.

At Boeing.

Not even close to what they are telling us.

I don't know where those numbers come from I can't tell you that.

I read the same numbers you do and we all kind of thought it was going to get better, but that's it's it's not to those levels yet to my right Joe.

Yeah, it's a it's unclear.

No, but you can't really get a straight answer about what the actual production level is per month, but we do feel it's below what's been publicly stated.

Okay.

And where do operations with respect to any supply chain disruptions. Currently stands are you seen any improvement in the situation.

Not at all no not even not even a little bit and again the issue isn't so much production at the plants overseas, it's getting it from the plant by truck to the to the port getting it on a port.

<unk> get finding about the boat, leaving on time and then the boat not being delayed at the three or four other stops along the way between you.

Shanghai and in Miami.

So.

Not better.

We're dealing with it as best we can like every other company.

And let's not even let's not forget talking about inflation, the pricing and all that stuff that goes with it for the shipping to the product itself, it's an enormous challenge.

Every day between the getting the product and.

And.

The product and getting the right price for it which is great actually.

And a related question here in the the inventory you built up to increase your safety stocks am I correct that this is mostly finished goods at Florida pneumatic against regularly stocked items.

Correct.

And do you feel the company is now at desirable levels and have the out of stock problem has been addressed.

Again, there are several items that are out of stock and there are others that we have an abundance of product.

Joe if you want to answer.

I would say, we're at least a month or two away.

The point, where I feel like were fully stocked.

Okay and regarding the large late 2021 order you also build inventory for am I correct to assume it's in Florida pneumatic as well.

Yes, it's all it's the bulk of the buildup is Florida.

Yeah.

And can you clarify the timing of when you book revenues on the receivables for that order and it's the end of March as this late 2021 order shipped out or what is the status now.

It it has not shipped yet.

Okay, and when you book revenues in the receivable, it's not booked until you ship is that correct.

Correct.

Okay, great I'll back out, but I have no more questions I've seen it yourself this year.

Alright. Thanks.

Okay.

Well go to our next question from Timothy Staples.

Good morning, gentlemen, I'm my own 4% of the company and the backend.

Back in in a conference call here I'm happy new year to everyone.

I wanted to.

Dart by asking.

And earnings related question, that's kind of a 50000 foot level question.

And that is.

You guys have done a lot over the last several years to remake the company, we sold divisions you've acquired things.

You've got a vision and a strategy it seems to me with regard to you know the.

We want the service and what.

What you Wanna do you you've been hit by unfortunate headwinds on an oil with an St volatility over a number of years here of Yo Yo Yo ing cycles, and and and of course Air Max well. My question for you is just how do you feel about it is not shown in the numbers, obviously, but how do you feel about what you've been doing.

You know when you look at P enough now versus a decade ago, when we baseboard heating or to the ARPA. You know what we are doing a long time ago. How do you feel about what you've been doing to try to give you credit for.

I have one here in your own words, obviously like where the company is going in these strategies and that they will pay off and that you believe in them and where we're going from here because.

You haven't been really credit is obviously in the numbers, but but I kind of wanted to hear you say that the shareholder base that seasonal presumably the value I see in the stock.

You know, where we're going and what you think so it's.

Can you speak to that.

Tim I'll I'll. This is Joe I'll try I would agree that we've had to pivot.

A little bit you know we've been in the toll business for a long time in for a very long time at least on the Florida pneumatic side, there were various distribution channels that where the way that you got the product to market and what we started to see especially with respect to the automotive was that.

The younger mechanics tax.

We're more and more comfortable with their ipads and their iphones and instead of entertaining a a van from one of the big distributors.

Distributors like snap on they were getting more and more comfortable with the internet and ordering product.

Directly and.

You know we've had a big shift.

And that business, we've had growth overall, but more importantly, a shift away from the traditional channels into more online both through Amazon in several large distributors who are also very large online. So we saw that and I think we were out in front of that frankly, and I don't quote me.

On this but I think in 'twenty 'twenty, a we had the most popular tool the most popular half inch impact sold on Amazon.

And you know we're up against some pretty big players.

So I feel very good about that move and you know where we didn't have the expertise in that marketing we brought some people in to help us and I think we did you know they did a great job with that and then.

You know on the high Tech side, I think the big pivot, which maybe you're alluding to was.

You know historically the business was built on large impacts targeted towards you know oil and gas and general construction and it was a distribution push model and.

That was becoming more and more difficult as we were starting to see.

The encouragement in that business from our Asian imports and as well as just a kind of a general shift away.

From the standard model impact wrench that was more popular moving to more torque control tools and hydraulic tools. So we took a look at what we're good at.

Which was Oh engineering and.

Reverse engineering and development and in the.

Aerospace and said Hey, we can use that brainpower to try to go.

Go after what we call OEM business, where we use our understanding of airpower and while we're not selling necessarily an air tool for sailing selling something that's it you know when air powered.

Product or gearbox or something inside of a large product and then from there we've seen an opportunity what I see as a tremendous opportunity.

In in gears in general.

Nationwide.

There's a very.

Minted market for gears are in the U S and that market is very.

In my opinion, a good chunk of it is very insulated from foreign imports and we've seen an opportunity to go out and acquire a number of smaller competitors and there are.

You know many or many others out there you know not just in the east, but in the south and the Midwest and you know without necessarily signaling exactly our intention. We think there's a lot of runway for us to build quite an operation nationally in in the gear business. So.

We've increased the breadth of products, we offer we've we've doubled even tripled the number of engineers involved in that business and we're starting to see some real we're starting to get some head turns from some very large company that buy companies that buy gears, because they're used to dealing with one and $2 million companies and now.

They're dealing with you know much more sophisticated entity. So we're very very excited about the future there and again, that's a big payment.

10 years ago, we were selling half inch impact so that was 90% of the business and that business isn't there anymore for various reasons. So we've had to move on and are we still sell plenty of happens impacts in three quarter inch impacts, but there are other places now to make money.

And I don't think I'll make one other mentioned that they're interested tech companies, we turned the company.

Totally in a different direction and so now we get these emails from time to time when people are about the Baker Hughes rig count et cetera, et cetera that really has very very little to do with our business anymore.

We still sell it but it's not just a tailwind in the dog so.

Anybody who is on this call that does that should understand that.

Okay, I'll get back with you, but suffice it to say I really appreciate that color. Thank you gentlemen.

I used to say I I presume that you still believe that this strategy is something that can earn well into are not asking for earnings projections, but are well into a double digit return on equity right.

That's fair.

We can't say that we I can't give you a prediction of return on equity, but I can I believe it's the best return for the shareholders. The direction were going given the skills. We currently have right.

Okay I'll get back in queue. Thank you for that call that color.

Sure.

As a reminder, if you'd like to ask a question at this time. Please press star one again that is star one for questions.

Oh.

Go next to Andrew Shapiro.

Okay. Thank you have a follow up on getting a little more color here.

The gear products.

Are there you know right before the <unk>.

Pandemic hit literally you know the week of you guys are moving in the equipment from your multiple quality gears entity entities.

Entities acquisition.

Are there aspects of your strategic goals and expectations for that acquisition.

That continued to lag as a result of Covid that you foresee still a opportunity for the company and can you discuss also the integration timing and milestones.

The recently announced Jackson gear acquisition into P. T G and discuss some of the strategic benefits and synergies.

Hope to achieve with that acquisition.

Sure I'll go first Oh to your first.

Yeah, we were moving the equipment as the pandemic hit and we that is a business that is incredibly reliant on engineers sitting around the table discussing you know some part in front of them or a gearbox or system.

And while you can maintain business without that face to face contact for the most part and then there's always some attrition it is incredibly difficult.

Difficult if not impossible to grow the business without that contact and its certainly better than it was.

For the last 24 months.

But I think in six months it'll be better than where it is so we're not quite.

At the point, where we've unfettered access to everybody, but it's absolutely better.

And I see no reason why it will get better into your your your Youre alluding to the question Yeah, I think there's a lot of opportunity yet that.

That we have not taken advantage of.

Is it a lack of being able to visit and then.

You were asking about the integration of the newly acquired Jackson gear.

All of the equipment has moved for them I believe all of the personnel has been hired.

The two of you know absorb that the factory is set up and the way that we're comfortable with all the there was a fair amount of electrical work that had to be done. We did had to take we need did need to take a little more square footage is.

As I mentioned earlier, we beefed up Engineering's, we've actually added state more space for engineers.

I would say we're still training some people are the the the one there were several nice things about this actual acquisition one that was very nice was that while the gears being manufactured by Jackson.

We're certainly.

On the larger side than than our than the highest end of our production capabilities. The.

The the skill set.

And the machines are quite similar and in some cases identical to the ones we were already using so the learning curve.

It was pretty small for our experienced machinist you know for the newer ones you know, they're learning gear cutting from the beginning but so that's really helped a lot in terms of milestones and this is my opinion.

It'll be a lot more reflective of of our opportunity.

In Q2 than Q1, and I think Q3 is probably really when we get the bulk of the bulk of the benefits, although frankly, I think with each passing quarter, we'll do a little bit better but it.

It's Q1, she's still transition Q2 was better than Q T. Three will be you know.

The bulk of the benefit that's my opinion.

And about how large was Jackson gear, what was its a revenue base that you acquired.

We didn't we didn't disclose that but I would say that it's it provided a significant increase to the current revenue levels of.

Of quality gear, a P T J in a relative sense in a relative sense.

So we'll start seeing that in the March quarter results yet to close this acquisition.

Right you couldn't you can't annualize March.

But you'll absolutely you won't miss it.

Okay.

And and.

In terms of your capital allocation.

Our priority is in such given the still strong balance sheet.

And.

Income.

Uh huh.

The company generated this year and your prospects.

I'm just wondering what.

What metrics what factors.

Has the board.

Communicated are determined they are waiting for before restarting the company's modest dividend, what's the timeline for the company to consider reinstituting the dividend.

Andrew what I can tell you is in.

It's like a broken record as you talk about this every single time and I can promise you and assure you that it is on our agenda every single time, we need.

We don't need we don't need your prodding, we appreciate your concern and your interest, but we don't need your Friday, we've been doing I think my questions pretty specific one.

The board is when he answered the question, let me answer the question.

When we when we when we discuss it at the board we discuss it with the fight with the with the bank agreements with our with our own capital needs.

Et cetera, and I promise you.

I'm the biggest stockholder I would be the biggest beneficiary of it.

And when we can do it we will do it when we feel its something thats sustainable.

We'll be we will be having a dividend and there's nothing more I can really give any more color to it I can only tell you that we and we understood the benefit of the dividend way before it was brought to our attention by anybody else and we instituted it when we did it.

And we understand very very well how are how it how it would help to the price of the stock and as I promise you as soon as we feel that we can that the company is safe in a position that we can have a sustained dividend not a one time dividend a sustained dividend going forward, we will be having it.

When that time comes due I think it's in the foreseeable future. If you ask me my opinion, I would say, yes, but I can't pinpoint a time for you any better than that.

So I appreciate your interest and your concern on it but I don't know how else to answer the question for you.

<unk>, we with without your questions, we discuss it very very regularly.

And my questions are asking for what the factors are that you guys consider ends up.

So I don't see that Oh.

No matter, how do you think that's a need you don't need the bark at a shareholder for it.

I'm not sure I would just stay in for your shareholders I'm.

I'm not I'm not barking at all.

And I'm, telling you exactly where it is and we discuss I said, Joe you can add any other color that you'd like to it if there is but when.

When we look at it we look at everything we just don't look at our shareholders. We look at our operation, which is more important because without our operation the shareholders don't have much to do so as long as we know the company is in good stead. That's when that's when that's when the benefit to stockholders all of US concluded we'll get the benefit of it.

Right.

Great.

Uh huh.

That Android later.

With respect to the press release discussing some capex.

Capex it seems like this it does.

Recent amount of things on your plate for Capex for the year can you give a little bit more color on the big items here that are planned in and what the benefits you see come from that.

Andrew I don't I mean, I know, there's a couple of decent sized pieces of equipment or we're looking at really nothing unusual and also bear in mind that.

A lot of our Capex you know don't quote me on the percentage, but it could be as much as half is.

So if you're asking me are we buying three three big wish D and C machines and that's the bulk of it it's not it's nothing.

No but are you, adding different are you, adding new capabilities through this is mostly replacement.

Hello, and you're cutting out or are you gone silent.

Yeah.

Hello.

Please standby.

Yeah.

Yeah.

And he's back in the queue.

No I'm here, we can't hear you guys.

You can't hear us Here's now now now we can.

Okay, Okay, I'm not sure what happened, but where do we cut your word but you got cut off Andrew.

Much on any explanation on if you were at enhancing capabilities or this is more maintenance capex.

To understand maybe if there is a payback and enhanced.

Cash flows and earnings to be expected from the Capex expenditures.

You know I would say, it's three things, it's it's maintenance, it's tooling, which is continuous as we bring online.

New products.

And there are probably a couple of pieces of equipment that would be there to try to increase efficiencies I think as we start to get our arms around the the Jackson customer base.

We may see some opportunities that we havent identified prior to the acquisition.

To create some efficiencies so it would say it's those three things I don't think it's any new market or anything like that so it would be those three things just maintenance tooling and then some pieces of equipment that can help us improve efficiency.

Okay and also tracking another big things here is what is the size and the status of your.

Q4 refunds you expected.

Assuming that is the E. R C. The employee retention credit that sizable hit this quarter and can you quantify that and is that the sizable jump that we see in the prepaid expenses.

And have you sense received the payment or when do you expect to receive that payment alright. So to answer your question, we no we haven't.

The jump in prepaid is related to is related to that I mean, what you'll see also is if you see what our our income for the year. Now this is GAAP not tax, but we were showing very little tax expense in relation to the reported profit so.

We have we had a number of Nols that were available.

Available to us so that we werent showing you know 26%.

Tax expense on that $2 million gain.

So there is a refund due.

The 2020.

<unk> filing, which we have not received yet.

And we don't know when we're going to receive it.

So that's 2020 income tax coming back.

Yes, refunding Nols from from the Nols.

And then with respect to the.

Employee retention credit, which is a sizable amount that you've listed here.

Are those taken concurrently or is that another check you expect to get in.

There's no other check it's just a check we arent paying if as I said.

Well, okay, so kind of I'm being reminded that yes. So we've got.

I mean, I'm I'm confusing you. So we've got the Nols, which do hopefully in the next few months related to 2020 return then we have the.

The tax.

Benefit related to now recording that expense.

Which we would expect we're going to get.

That back sometime in 'twenty, three but that's what we're being told 'twenty 'twenty three or this calendar year. So let me just okay. So that the 2020 return generated like you know a million dollars at a refund.

Okay. That's good it's coming in the next few months, we don't know exactly why.

The 2021 return, where we filed will be got.

This employee retention credit would.

It would be generating something like a $2 million refund, but that's not to be expected until we've been told by our tax people not to expect that in 'twenty two it'll be hopefully early 'twenty three we don't know when.

Yeah, they take a long time on the air So that is that as cash flow. It is due to us and on the way hopefully from the government K well $3 million.

Approximately from those two things that's a dollar a share in cash.

It is.

Yeah, Okay, that's nice to know and will ask about it periodically as you get visibility on the timing.

Some of that of your press release made no mention of any current shares outstanding number or even the one used for EPS calculations. So all we have is the prior 10-Q to go off with can you provide us with a more current outstanding share fully diluted share count.

It's unchanged Andrew.

Okay. So we're dealing with about $10.50 frankly more than 10, 50, a share and tangible book value and almost $14 a share and book value a share then.

Give or take given the I haven't done that math, yet lately, but yes that sounds about right.

Okay.

And.

Do you you guys, obviously feel our company shares are undervalued.

When do you feel it would be appropriate.

For the company to spend.

Any time in addition to these quarterly calls articulating the company's investment proposition B a.

You know incremental and they have these virtual things, where you wouldn't even have to leave the comfort of your couch.

To.

Do a little bit of Investor relations activity.

Well as we've said before you know we've looked at that periodically.

Given the trading in the stock every everyone. We've spoken to you about that said that there's just not a good use of our resources.

Yeah, well, that's a chicken and egg issue always consider it.

Yes, it's a chicken and egg issue if you don't tell.

Tell your story and articulated beyond these wonderful calls.

But Andrew we can't create or enhance it.

You can't create no you don't need no.

That is true you cannot create shares but if you create interest for shares in the stock doesn't appear to be a roach motel, where you can get in but can't get out.

You will have enhanced trading liquidity and you'll have a higher price, which will generate even more trading liquidity, it's again chicken and egg issue alright.

Back out I have more questions on a few divisions.

Yeah.

It will go.

To our next caller Timothy Staples.

Youre not going to believe this but I actually disagree with Andrew on this one.

I don't think that Investor relations is a good thing in TNF is always needed more of it in my opinion, so I agree with them on that but where I disagree with it I don't think theres enough of a story to tell yet you've got to start getting some traction.

Profit why isn't it showing that these you know this is a growth company. The strategies are working so I agree with the management on this one that Oh.

More heavy.

More and more heavy hitting investor relations efforts or probably not.

Quite we're not quite there yet.

So oh.

That having been said I appreciate the discussion around the dividend.

And their willingness to give some color on that Richard.

Obviously buybacks have been significant strangely enough. He bought shares back from the shareholder years ago. I believe you bought a block back from fidelity and the count has gone down from $83 six $3 7 million down to $3. One that's what.

Oh, what the asset value underlying the company that's been a way to increase shareholder value.

Hum.

I do think that I did actually to be honest with you.

Text Mr. Shapiro this morning, saying where are the Q4 numbers because I kind of of Reacquaint myself more deeply with the company as I've bought shares the last a few months.

I did want a second the notion that.

And very respectfully that I am not aware of a public company on NASDAQ that that does not like actually released its Q4 numbers. So well I do appreciate it and have some level of respect a desire to perhaps keep cost down or something.

From an investor relations standpoint, and a broadening of the shareholder base to be a company that doesn't actually released Q4 numbers is very damaging to the ability to broaden the shareholder base and I really would encourage the board as they listen to this call and management to start releasing those numbers and to spend that money and put that out there because you might as well that can be.

Got it. It's just you know so I just I just wanted to put make that point out there.

Alright. Thank you. Thank you.

And I might have another but I'm gonna get back in queue I'm figuring Mr. Shapiro, probably has another question I'm just guessing.

Thank you.

For hearing me out.

Yeah.

And we will go back to Mr. Shapiro.

Great. Thank you.

On a pre pandemic call you said progress was developing for Aercap. In addition to aerospace tools for distribution opportunities in Europe and of course, the pandemic hit.

But Europe is reopening where did those efforts a stand and is a new market share and growth still.

On the horizon for this company in Europe .

Yes.

Need for Aercap.

By the way are Europe is shutting down its not opening up.

From what from what from what I've been reading more more and more.

But but having said that our people are telling us that they are having.

Availability of more onsite visits and some of the European countries now.

And it's been going on for I would say 60 days or something like that and the numbers are starting to show that.

Improvements in that regard is that the question you're asking.

Yeah.

Partially yes.

It was air Cat and aerospace.

You were going to get mentioned it.

We mentioned.

It's not.

It's not open yet I think we mentioned that earlier in the call.

Claim it is going to be momentarily, but we have not been told that ethanol.

Airbus you mean Airbus Airbus.

Andrew I will I will share. This we now have a warehouse in in the EU in Germany, where we stock.

Some are cat some.

Our U T and actually even some high tech product and we did that because what we were seeing after U K left the EU it was becoming cumbersome and.

Difficult for our customers to work with us. So we've opened up a small warehouse that's managed by our our German.

Chairman head of <unk>.

Sales.

Okay.

And regarding the the tools.

Can you provide an update and some more color on your developments of the cordless models and the types of automotive and non automotive applications for which other companies developing the cordless models in each of Hy Tech and Florida pneumatic I think on prior calls you said that beginning of this year there would be more <unk>.

Formation on that.

With respect to automotive we currently are not working on any cordless.

Product.

We have some where we have some development going on in some other areas, which I'm not going to get into a lot of detail.

But it's been challenging.

There have been some supply chain issues and.

Development has been difficult because as you may or may not know that technology is tightly controlled by three very large companies.

So.

Getting into that has been a little more difficult we've been more successful at working with other companies that have.

So battery technology already and seeing what we can do to add on to their system.

As opposed to just starting from scratch in developing our own cordless tool, but there is some of that still going on but progress is unfortunately.

Been held up a bit.

Yeah.

Oh, Thank you and and regarding your new products and experience, so far and that in the high Tech.

OEM engineered solutions, which you again stated that you are emphasizing versus a T. P are there any particular areas industries or products worthy of any callout an elaboration.

Well I would say that with the the addition of Jackson, we're now into a few other markets that that we weren't necessarily into before where we're much bigger into mining than we were and I don't I'm not talking about mining for.

Coal, although there is certainly some of that it would be mining for other metals.

Both rare and not so rare and there are opportunities.

Both within.

The tools themselves the machines that are involved in mining all sorts of production equipment involved and in mining that where we're seeing so mining.

Globally is now a much more important part of our business than it than it ever was.

<unk>.

Okay. Thank you and on the spray gun tools had enjoyed.

Substantial year over year increases for many quarters.

Our such sales beginning to run up against tougher comps and do you see this business just leveling off or scaling down.

Yes. The answer is yes is scaling down and set a new level, a new lower level than it was without a question.

Without a question I think it's higher than it was pre pandemic, but lower than the peak of the pandemic I think is how I would describe I wasn't agree with that.

Okay.

And has the.

The Amazon Channel I think you've stated has continued its growth.

Am I correct and have you seen channels other than Amazon exhibit increases yet.

Other.

In digital channels Internet channels I'm not sure what you mean.

Well I mean, you have your direct to home depot.

And you have your I guess other other.

<unk> branded and you go through Amazon, but you.

You know you've had catalog grainger.

Other channels that were meaningful before.

Is your Amazon growth at their expense or have you seen these other channels exhibit increases yet from the post again Amazon is Amazon is almost exclusively automotive.

We do sell a few.

The Austrian tolls, there, but it's automotive and as I said earlier it absolutely is at the expense of other channels.

Yeah.

So I don't know if that answers your question.

Yeah, I guess it pretty much does I'll back out into the queue may be done even.

Okay.

And again as a reminder, if you'd like to ask a question. Please press star one at this time again that is star one for questions.

And its star one for questions.

And we will.

Go again to Timothy Staples.

Yes.

I did note in the earnings release. Thank you I did note in the earnings release, the concluding statement Richard that our our goal has always been to serve our customers while improving shareholder value.

Interestingly enough 20 years ago. It was March 29, 2002, the stock was trading at $7. So we've gotten about $1 plus worth of dividend stocks $6 now.

Basically as shareholders, but flat over 20 years.

Can you give us reassurance on how the next 20 years me and why it would be different in the last 20 years.

I don't have a crystal ball I can't possibly answer that question I'm really sorry, but I'd be happy to answer any questions. You have that I can have a full I you know I cant in this world I can't we can't look more than three months ahead, how can we look 20 years ahead.

Yeah.

Is there any context of the fact that the shareholders have made anything the fact that you've taken about $25 million out of the company over the last 20 years.

I don't know that any part of it.

I don't understand your question has to do with her.

Okay. Thank you.

And again that is star one for questions.

And it appears there are no further questions at this time.

Okay, well, thank you all for being on the call today with us and.

We look forward to speaking to you in may for our first quarter.

2022 results.

Good day, all and everybody. Please stay safe. Thank you.

This concludes today's call. Thank you for your participation you may now disconnect.

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