Full Year 2026 Greystone Logistics Inc Earnings Call
Speaker #1: Good day, everyone, and welcome to today's Greystone Q4 results conference call. At this time, all participants are in a listen-only mode. Later, you'll have the opportunity to ask questions during the question-and-answer session.
Operator 2: Good day, everyone, and welcome to today's Greystone Q4 Results Conference Call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing the star and 1 on your telephone keypad. Please note this call is being recorded, and I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Brendan Hopkins. Please go ahead.
Operator: Good day, everyone, and welcome to today's Greystone Q4 Results Conference Call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing the star and one on your telephone keypad. Please note this call is being recorded, and I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Brendan Hopkins. Please go ahead.
Speaker #1: You may register to ask a question at any time, by pressing the star and 1 on your telephone keypad. Please note this call is being recorded, and I will be standing by if you should need any assistance.
Speaker #1: It is now my pleasure to turn the conference over to Brendan Hopkins. Please go ahead.
Speaker #2: Thank you, and thank you everyone for joining us today. We have a brief blue-sky statement, and then we'll start. Except for historical information contained herein, statements made in this conference call are forward-looking statements, made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
Brendan Hopkins: Thank you, and thank everyone for joining us today. We have a brief blue sky statement, and then we will start. Except for historical information contained herein, statements in this conference call are forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from forecasted results. With that said, I would like to turn the call over to Warren Kruger, CEO of Greystone.
Brendan Hopkins: Thank you, and thank everyone for joining us today. We have a brief blue sky statement, and then we will start. Except for historical information contained herein, statements in this conference call are forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from forecasted results. With that said, I would like to turn the call over to Warren Kruger, CEO of Greystone.
Speaker #2: Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from forecasted results. With that said, I would like to turn the call over to Warren Kruger, CEO of Greystone.
Speaker #3: Hello, everyone. And thank you so much for being on the call. I wish these are the times that I wish that there was better news to present to you, but the news is the news.
Warren Kruger: Hello, everyone, and thank you so much for being on the call. These are the times that I wish that there was better news to present to you, but the news is the news. You have all gone through our 10-K, and you can see we had a very difficult year ending 31 May. Again, I will go back and I will rehash the history so that those who do not know will have a fresh idea of what happened. We had an 11-year relationship with a company called iGPS Logistics. We started with them with one mold, one machine, and we went up to about 1.2 million pallets per year. In October last year, I got a call and they said, "Today's our last day after an 11-year relationship." Well, it was most certainly unexpected because we were grinding about 400,000 broken pallets a year, and reprocessing that resin.
Warren Kruger: Hello, everyone, and thank you so much for being on the call. These are the times that I wish that there was better news to present to you, but the news is the news. You have all gone through our 10-K, and you can see we had a very difficult year ending 31 May. Again, I will go back and I will rehash the history so that those who do not know will have a fresh idea of what happened. We had an 11-year relationship with a company called iGPS Logistics. We started with them with one mold, one machine, and we went up to about 1.2 million pallets per year. In October last year, I got a call and they said, "Today's our last day after an 11-year relationship." Well, it was most certainly unexpected because we were grinding about 400,000 broken pallets a year, and reprocessing that resin.
Speaker #3: And you've all gone through our 10-K, and you can see we had a very difficult year ending May 31. And again, I'll go back and rehash the history so that those who don't know will have a fresh idea of what happened.
Speaker #3: We had an 11-year relationship with a company called IGPS. We started with them with one mold, one machine, and we went up to about 1.2 million pallets per year.
Speaker #3: And in the last it was in October last year, I got a call, and they said, "Today is our last day after 11-year relationship." Well, it was most certainly unexpected because we were grinding about 400,000 broken pallets a year and reprocessing that resin.
Speaker #3: And this is these are things that are not easy to do. They're difficult. You have to have the equipment. You have to have the knowledge.
Warren Kruger: These are things that are not easy to do. They are difficult. You have to have the equipment, you have to have the knowledge, you have to have the personnel, and then we have to have the equipment to reprocess it, to put it in a BB form to reutilize it. It is great because that is the world we live in. It is exactly as we present ourselves. We take waste plastic, and we make new products. So it was a wonderful thing, and we never anticipated that they would leave us. In fact, they did. They have decided to go out of the growth mode and go into just a more like a reap what they have sown type of mode. They did have an operation that produced pallets down in Dallas, Texas. So they have, they dropped off about 800,000 pallets a year, in their growth plans.
Warren Kruger: These are things that are not easy to do. They are difficult. You have to have the equipment, you have to have the knowledge, you have to have the personnel, and then we have to have the equipment to reprocess it, to put it in a BB form to reutilize it. It is great because that is the world we live in. It is exactly as we present ourselves. We take waste plastic, and we make new products. So it was a wonderful thing, and we never anticipated that they would leave us. In fact, they did. They have decided to go out of the growth mode and go into just a more like a reap what they have sown type of mode. They did have an operation that produced pallets down in Dallas, Texas. So they have, they dropped off about 800,000 pallets a year, in their growth plans.
Speaker #3: You have to have the personnel, and then we have to have the equipment to reprocess it, to put it in a BB form, to reutilize it.
Speaker #3: And it's great because that's the world we live in. It is—it is exactly as we present ourselves. We take waste plastic, and we make new products.
Speaker #3: So it was a wonderful thing. And we never anticipated that they would leave us. In fact, they did. They've decided to go out of the growth mode and go into just a more like reap what they've sown type of mode.
Speaker #3: And they did have an operation that produced pallets down in Dallas, Texas. So they've dropped off about 800,000 pallets a year in their growth plans.
Speaker #3: So that left us in a situation that presented itself—we had to jump on it. And we laid off about 140 people in December.
Warren Kruger: That left us in a situation that, presented us, we had to jump on it, and we laid off about 140 people in December. We have pared back dramatically. The good news is, we immediately reached out to our bank, IBC Bank. They have been fabulous. We have had a fabulous relationship with them over time. We said, "Hey, we need to go immediately into interest only, for 2026 for the year." They agreed to do so. Part of what you will see on our 10-K is everything is current. Well, our auditors make us show everything is current, but in fact, we are paying interest only, and our banker, he has been gracious enough to say, "Why is it all current when it is not due until the date of the note?" But in fact, the auditors, the way we are structured is they have to put it all as current.
Warren Kruger: That left us in a situation that, presented us, we had to jump on it, and we laid off about 140 people in December. We have pared back dramatically. The good news is, we immediately reached out to our bank, IBC Bank. They have been fabulous. We have had a fabulous relationship with them over time. We said, "Hey, we need to go immediately into interest only, for 2026 for the year." They agreed to do so. Part of what you will see on our 10-K is everything is current.
Speaker #3: And we have pared back dramatically. The good news is we immediately reached out to our bank, IBC Bank. They've been fabulous; we've had a fabulous relationship with them over time.
Speaker #3: We said, "Hey, we need to go immediately into interest-only for the 2026 for the year." And they agreed to do so. And part of what you'll see on our 10-K is everything's current.
Speaker #3: Well, our auditors make us show everything is current. But in fact, we're paying interest only, and our bankers have been he's been gracious enough to say, "Why is it all current when it's not due until the date of the note?" But in fact, the auditors the way it's we're structured is they have to put it all as current.
Warren Kruger: Well, our auditors make us show everything is current, but in fact, we are paying interest only, and our banker, he has been gracious enough to say, "Why is it all current when it is not due until the date of the note?" But in fact, the auditors, the way we are structured is they have to put it all as current.
Speaker #3: So, we feel comfortable with our banking relationship. We feel comfortable with our plan. We have had... Let me just go to the financials. As you can see, we're off about $30 million.
Warren Kruger: We feel comfortable with our banking relationship. We feel comfortable with our plan. We have had, let me just go to the financials. As you can see, we are off about $30 million. That $30 million, it matters. Once you cover those fixed costs and you put on the sales, then everything drops to the bottom line. We have had really a tough year filling that void. I anticipate that it will be in calendar year 2027 before we are really fully back on board. We have had numerous discussions. We have a relationship with multiple firms that we are doing projects with now that will add revenue. We have a Keg Pallet for Yuengling that we have produced. Yuengling said that they couldn't take it in the summertime, but I anticipate we will be selling to them in the fall.
Warren Kruger: We feel comfortable with our banking relationship. We feel comfortable with our plan. We have had, let me just go to the financials. As you can see, we are off about $30 million. That $30 million, it matters. Once you cover those fixed costs and you put on the sales, then everything drops to the bottom line. We have had really a tough year filling that void. I anticipate that it will be in calendar year 2027 before we are really fully back on board. We have had numerous discussions. We have a relationship with multiple firms that we are doing projects with now that will add revenue. We have a Keg Pallet for Yuengling that we have produced. Yuengling said that they couldn't take it in the summertime, but I anticipate we will be selling to them in the fall.
Speaker #3: And that 30 million dollars it matters. It's once you cover those fixed costs and you put on the sales and everything drops to the bottom line.
Speaker #3: And so we have had really a tough year filling that void. And so I anticipate that it'll be in calendar year 27 before we're really fully back on board.
Speaker #3: We've have numerous discussions. We have a relationship with multiple firms that we're doing projects with now that will add revenue. We have a keg pallet for Ying Ling.
Speaker #3: That we have produced, and Ying Ling said that they couldn't take it in the summertime, but I anticipate we'll be selling to them in the fall.
Speaker #3: Walmart, we've had a 50 million dollar relationship with Walmart over the last five or six years. We continued to provide pallets into the Walmart system.
Warren Kruger: Walmart, we have had a $50 million relationship with Walmart over the last five or six years. We continue to provide pallets to the Walmart system, but we are behind our schedule with them. There was some leadership change at the top at Walmart. Our contact, who I had for about 20 years, a gentleman named Bill Greten, he retired. We have been dealing with new folks. All that being said, our team at Greystone continues to work diligently every day to fill the sales volume. What we have done is, during the period of time that iGPS Logistics was our customer, we were prohibited from going out and leasing pallets. We are now in full scale mode. We are tracking and tracing pallets and doing that in multiple areas.
Warren Kruger: Walmart, we have had a $50 million relationship with Walmart over the last five or six years. We continue to provide pallets to the Walmart system, but we are behind our schedule with them. There was some leadership change at the top at Walmart. Our contact, who I had for about 20 years, a gentleman named Bill Greten, he retired. We have been dealing with new folks. All that being said, our team at Greystone continues to work diligently every day to fill the sales volume. What we have done is, during the period of time that iGPS Logistics was our customer, we were prohibited from going out and leasing pallets. We are now in full scale mode. We are tracking and tracing pallets and doing that in multiple areas.
Speaker #3: But we are behind our schedule with them. And there was some leadership change at the top at Walmart. And our contact, who I had for about 20 years, a gentleman named Bill Greeton.
Speaker #3: He retired, so we've been dealing with new folks. But all that being said, our team at Greystone continues to work diligently every day to fill the sales volume.
Speaker #3: And what we have done is, during the period of time that IGPS was our customer, we were prohibited from going out and leasing pallets.
Speaker #3: We are now in full-scale mode. We're tracking and tracing pallets and doing that in multiple areas. We have a firm out of Philadelphia that's been a wonderful partner—that is, they do that.
Warren Kruger: We have a firm out of Philadelphia that has been a wonderful partner. They have their own tracking and tracing program, and they are testing our pallet with multiple customers. We have another firm out of California that they are testing our product with track and trace, and their own track and trace program, and that has been quite enlightening. We have another big leasing program that we have quoted on, and I anticipate that in the next 90 days, that will come to fruition. It is a large Midwestern company that has been using wooden pallets for years, and they generate plastic, and they know that they should be on plastic, and I anticipate that happening. We also have a double-decker pallet that we have designed that is the same on the top as it is on the bottom.
Warren Kruger: We have a firm out of Philadelphia that has been a wonderful partner. They have their own tracking and tracing program, and they are testing our pallet with multiple customers. We have another firm out of California that they are testing our product with track and trace, and their own track and trace program, and that has been quite enlightening. We have another big leasing program that we have quoted on, and I anticipate that in the next 90 days, that will come to fruition. It is a large Midwestern company that has been using wooden pallets for years, and they generate plastic, and they know that they should be on plastic, and I anticipate that happening. We also have a double-decker pallet that we have designed that is the same on the top as it is on the bottom.
Speaker #3: They have their own tracking and tracing program. And they're testing our pallet with multiple customers. We have another firm out of California that they're testing our product with track and trace.
Speaker #3: And their own track and trace program. And that's been quite enlightening. We have another big leasing program that we've quoted on and I anticipate that in the next 90 days that that will come to fruition.
Speaker #3: It's a large Midwestern company that's been using pallet wooden pallets for years. And they generate plastic, and they know that they should be on plastic.
Speaker #3: And I anticipate that happening. We also have a double-decker pallet that we have designed that's the same on the top as it is on the bottom.
Speaker #3: We've been doing some of this in the concrete industry. We've been tracking and tracing pallets that carry the concrete, and it's been quite successful.
Warren Kruger: We are doing some of this in the concrete industry, and we have been tracking and tracing pallets that can carry the concrete, and it has been quite successful. We also anticipate that we will continue to get some more of that business. Be that as it may, we have to replace revenue. That is our focus right now, is replacing revenue and managing our expenses and our capital. We have really limited any CapEx except for maintenance CapEx. I am proud of what our internal staff is doing in the Bettendorf area and our new equipment in Palmyra, Missouri. We have had some of that subleased. It was empty equipment, and we have subleased it so that we could get some revenue off those machines.
Warren Kruger: We are doing some of this in the concrete industry, and we have been tracking and tracing pallets that can carry the concrete, and it has been quite successful. We also anticipate that we will continue to get some more of that business. Be that as it may, we have to replace revenue. That is our focus right now, is replacing revenue and managing our expenses and our capital. We have really limited any CapEx except for maintenance CapEx. I am proud of what our internal staff is doing in the Bettendorf area and our new equipment in Palmyra, Missouri. We have had some of that subleased. It was empty equipment, and we have subleased it so that we could get some revenue off those machines.
Speaker #3: And we also anticipate that we'll continue to get some more of that business. Be that as it may, we have to replace revenue. And that's our focus right now is replacing revenue.
Speaker #3: And managing our expenses and our capital, we've really limited any capital expenditures except for maintenance capex. So, I'm proud of what our internal staff is doing in the Bettendorf area.
Speaker #3: And our new equipment in Palmyra, Missouri—we've had some of that subleased. It was empty equipment, and we've subleased it so that we could get some revenue off those machines.
Speaker #3: And again, I look forward to opening it up to questions, because all I can do is answer your questions and say that we're working very hard every day for you.
Warren Kruger: I look forward to opening it up with questions because all I can do is answer your questions and say that we are working very hard every day for you. At this time, I would be happy to answer any questions that our shareholders might have.
Warren Kruger: I look forward to opening it up with questions because all I can do is answer your questions and say that we are working very hard every day for you. At this time, I would be happy to answer any questions that our shareholders might have.
Speaker #3: So at this time, I'd be happy to answer any questions that our shareholders might have.
Speaker #1: Thank you. At this time, we will open the question and answer session. If you would like to ask a question, please press star and one on your telephone keypad.
Operator 2: Thank you. At this time, we will open the question and answer session. If you would like to ask a question, please press star and one on your telephone keypad, and you will be placed into the queue in the order received. You may remove yourself from the queue at any time by pressing pound and one. Once again, to ask a question, press star one on your phone now. Once again, if you would like to ask a question, please signal by pressing star one.
Operator: Thank you. At this time, we will open the question and answer session. If you would like to ask a question, please press star and one on your telephone keypad, and you will be placed into the queue in the order received. You may remove yourself from the queue at any time by pressing pound and one. Once again, to ask a question, press star one on your phone now. Once again, if you would like to ask a question, please signal by pressing star one.
Speaker #1: And you'll be placed into the queue in the order received. You may remove yourself from the queue at any time by pressing pound and one.
Speaker #1: Once again, to ask a question, press star one on your phone now. And once again, if you would like to ask a question, please signal by pressing star one.
Speaker #3: Wow.
Warren Kruger: Wow.
Warren Kruger: Wow.
Speaker #1: Okay. Mr. Krueger, it appears there are no questions at this time. I'll turn the conference back to you.
Operator 2: Okay, Mr. Kruger, it appears there are no questions at this time. I will turn the conference back to you.
Operator: Okay, Mr. Kruger, it appears there are no questions at this time. I will turn the conference back to you.
Speaker #3: Well, I will I'll mention to anyone on the call, and there's quite a few that we have on the call this morning, I am available every day for my shareholders to talk to.
Warren Kruger: Well, I will mention to anyone on the call, and there is quite a few that we have on the call this morning, I am available every day for my shareholders to talk to. If someone wants to ask questions offline and ask about our capabilities, what our strategic plan is on the sales side, I would welcome those calls. If everyone has a pencil in hand, I want to make sure that you have my mobile number so that you can reach me at any time. That is 918-231-0616.
Warren Kruger: Well, I will mention to anyone on the call, and there is quite a few that we have on the call this morning, I am available every day for my shareholders to talk to. If someone wants to ask questions offline and ask about our capabilities, what our strategic plan is on the sales side, I would welcome those calls. If everyone has a pencil in hand, I want to make sure that you have my mobile number so that you can reach me at any time. That is 918-231-0616.
Speaker #3: And so if someone wants to ask questions offline, and ask about our capabilities, what our strategic plan is on the sales side, I'd welcome those calls.
Speaker #3: And if everyone has a pencil in hand, I want to make sure that you have my mobile number so that you can reach me at any time.
Speaker #3: And that's 918-231-0616.
Speaker #1: And Mr. Krueger, we did have a participant signal. We'll go ahead and take that question from Eric Nickerson. Please go ahead.
Operator 2: Mr. Kruger, we did have a participant signal. We will go ahead and take that question from Eric Nickerson. Please go ahead.
Operator: Mr. Kruger, we did have a participant signal. We will go ahead and take that question from Eric Nickerson. Please go ahead.
Speaker #4: Yeah. Hi. I've had some conversations with Brendan where he's mentioned that you guys are doing some sort of sideline work, grinding plastic or grinding pallets for other companies.
Eric Nickerson: Yeah, hi. I have had some conversations with Brendan, where he has mentioned that you guys are doing some sort of sideline work, grinding plastic or grinding pallets for other companies. I am sorry, I do not recall the details of that too well, but
[Analyst]: Yeah, hi. I have had some conversations with Brendan, where he has mentioned that you guys are doing some sort of sideline work, grinding plastic or grinding pallets for other companies. I am sorry, I do not recall the details of that too well, but apparently it is a revenue generator. I wonder if you would like to mention that.
Speaker #4: I'm sorry, I don't recall the details of that too well. But apparently, it's a revenue generator, and I wonder if you'd like to mention that.
Warren Kruger: Yeah
Eric Nickerson: apparently it is a revenue generator. I wonder if you would like to mention that.
Speaker #3: Yes. Thank you for mentioning that. Years ago, when we got in this business, we had kind of a three-legged stool, and we were one, we were going to make and sell pallets.
Warren Kruger: Yes. Thank you for mentioning that. Years ago, when we got in this business, we had kind of a three-legged stool. One, we were going to make and sell pallets. Two, we were going to make and reprocess and sell resin. Then three, we were going to lease. Well, we took care of the leasing by getting iGPS as a customer. So we took care of that leg of the stool. We already had manufactured the pallets, so we had that leg of the stool. The third leg of the stool was selling excess plastic resin in the marketplace. We did that for many, many years. We processed and sold excess resin. But as we grew, we consumed everything we used. We consumed it all. So we really did not generate new revenue from selling excess resin.
Warren Kruger: Yes. Thank you for mentioning that. Years ago, when we got in this business, we had kind of a three-legged stool. One, we were going to make and sell pallets. Two, we were going to make and reprocess and sell resin. Then three, we were going to lease. Well, we took care of the leasing by getting iGPS as a customer. So we took care of that leg of the stool. We already had manufactured the pallets, so we had that leg of the stool. The third leg of the stool was selling excess plastic resin in the marketplace. We did that for many, many years. We processed and sold excess resin. But as we grew, we consumed everything we used. We consumed it all. So we really did not generate new revenue from selling excess resin.
Speaker #3: Two, we were going to make and reprocess and sell resin. And then three, we were going to lease. Well, we took care of the leasing by getting IGPS as a customer.
Speaker #3: So we took care of that leg of the stool. We already had the manufactured the pallets. So we had that leg of the stool.
Speaker #3: And the third leg of the stool was selling excess plastic resin, the marketplace. We did that for many, many years. We processed and sold excess resin resin.
Speaker #3: But as we grew, we consumed everything we used. We consumed it all. So that was we really didn't generate new revenue from selling excess resin.
Warren Kruger: When we knew we were going to have this issue, we've contracted to grind and granulate a large quantity of plastic. Then we've also been contracted with to provide BB services to make usable BBs for the customer. That has helped on the revenue side, and we are continuing to do so, and we are continuing to solicit business. Matter of fact, I talked to someone today. That's funny that you even brought it up. I talked to someone today out of St. Louis that said that they had large quantities of plastic that they reprocess, they outsource. So it was one of those, we'll be happy to quote on that and do that because we have the capabilities and the equipment to do so. I really appreciate that you mentioned that.
Warren Kruger: When we knew we were going to have this issue, we've contracted to grind and granulate a large quantity of plastic. Then we've also been contracted with to provide BB services to make usable BBs for the customer. That has helped on the revenue side, and we are continuing to do so, and we are continuing to solicit business. Matter of fact, I talked to someone today. That's funny that you even brought it up. I talked to someone today out of St. Louis that said that they had large quantities of plastic that they reprocess, they outsource. So it was one of those, we'll be happy to quote on that and do that because we have the capabilities and the equipment to do so. I really appreciate that you mentioned that.
Speaker #3: We when we knew we were going to have this issue, we have contracted to grind and granulate a great large quantity of plastic. And then we've also been contracted with to provide BB services to make usable BBs for the customer.
Speaker #3: And that has helped on the revenue side. And we are continuing to do so. And we are continuing to solicit business. As a matter of fact, I talked to someone today that's funny that you even brought it up.
Speaker #3: I talked to someone today out of St. Louis that said that they had large quantities of plastic that they reprocess. They outsource, and so it was one of those—'We'll be happy to quote on that and do that because we have the capabilities.'
Speaker #3: And the equipment to do so. I really appreciate that you mentioned that.
Speaker #4: Okay. Well, good. Apparently, you have some time. So maybe you could add some color to another comment. So you lost IPGS or IGPS back in December.
Eric Nickerson: Well, good. Apparently you have some time, so maybe you could add some color to another comment. So you lost iGPS Logistics back in December. They just suddenly-
[Analyst]: Well, good. Apparently you have some time, so maybe you could add some color to another comment. So you lost iGPS Logistics back in December. They just suddenly stopped buying. $30 million of revenue is going away. It's been, what, 6 to 9 months since then. Have you been able to identify all of the, where are those people that they're not selling to getting their pallets now?
Speaker #4: They just suddenly stopped buying. $30 million of revenue has gone away. It's been what, six to nine months since then? Have you been able to identify all of the where are those people that they're not selling to getting their pallets now?
Warren Kruger: It was a-
Eric Nickerson: stopped buying. $30 million of revenue is going away. It's been, what, 6 to 9 months since then. Have you been able to identify all of the, where are those people that they're not selling to getting their pallets now?
Speaker #3: Well, IGPS is a leasing company. So they were a growth company. And they're really the only large plastic there are three large pallet rental companies in America.
Warren Kruger: Well, iGPS is a leasing company. They were a growth company, and they are really the only large plastic There are three large pallet rental companies in America. A wooden pallet company called CHEP, owned by Brambles of Australia. Another company called PECO, P-E-C-O. Those companies, really, they will go to Procter & Gambles of the world or whomever, and they will say, "How many pallets do you need?" And they will provide wooden pallets on a rent per use basis. iGPS entered that market probably, oh, now it has been 13 or 14 years, a long time ago. And they are really the largest plastic pallet leasing company. But they were in a growth mode for, God, for years and years and years. So a lot of opportunity to do that on that side. And people do want to lease plastic versus wood.
Warren Kruger: Well, iGPS is a leasing company. They were a growth company, and they are really the only large plastic There are three large pallet rental companies in America. A wooden pallet company called CHEP, owned by Brambles of Australia. Another company called PECO, P-E-C-O. Those companies, really, they will go to Procter & Gambles of the world or whomever, and they will say, "How many pallets do you need?" And they will provide wooden pallets on a rent per use basis. iGPS entered that market probably, oh, now it has been 13 or 14 years, a long time ago. And they are really the largest plastic pallet leasing company. But they were in a growth mode for, God, for years and years and years. So a lot of opportunity to do that on that side. And people do want to lease plastic versus wood.
Speaker #3: A wooden pallet company called CHEP owned by Brambles of Australia. Another company called Paco, P-E-C-O. And those companies really they'll go to Procter & Gamble's of the world or whomever.
Speaker #3: And they will say, "How many pallets do you need?" And they'll provide wooden pallets on a rent-per-use basis. And IGPS entered that market probably, oh, now it's been 13 or 14 years.
Speaker #3: Long time ago. And they are the really the largest plastic pallet leasing company. But they were in a growth mode for God, for years and years and years.
Speaker #3: So a lot of opportunity to do that on that side. And people do want to lease plastic versus wood. And so but they're owned by a private equity company.
Warren Kruger: But they are owned by a private equity company, and they were generating a lot of cash, but they were pouring all of their cash back into growth and pallets. And what they have done is they have said, "Okay, we are not going to pour all our money now into growth. We are going to retain some of that money, and we are just going to go into a maintenance mode. And we are going to mow the grass we already have, and we are not going to grow any new fields right now." So that is where they are. So the opportunities have not gone away, but they are not putting on as many customers as they were now. And that allows people like other leasing companies, other folks that want to do leasing in that world, that allows them to enter and have an opportunity.
Warren Kruger: But they are owned by a private equity company, and they were generating a lot of cash, but they were pouring all of their cash back into growth and pallets. What they have done is they have said, "Okay, we are not going to pour all our money now into growth. We are going to retain some of that money, and we are just going to go into a maintenance mode. We are going to mow the grass we already have, and we are not going to grow any new fields right now." That is where they are. The opportunities have not gone away, but they are not putting on as many customers as they were now. That allows people like other leasing companies, other folks that want to do leasing in that world, that allows them to enter and have an opportunity.
Speaker #3: And they were generating a lot of cash, but they were pouring all their cash back into growth and pallets. And what they've done is they've said, "Okay.
Speaker #3: We're not going to pour all our money now into growth. We're going to pour it into we're going to retain some of that money, and we're just going to go into a maintenance mode.
Speaker #3: And we're going to mow the grass we already have, and we're not going to grow any new fields right now. So that's where they are.
Speaker #3: So, the opportunities haven't gone away, but they're not putting on as many customers as they were. And that allows people like other leasing companies—other folks that want to do leasing in that world—that allows them to enter and have an opportunity.
Speaker #3: So, they haven't gone away. But in this world, in the pallet world—I've been in this business 25 years—it's a long sales cycle.
Warren Kruger: They have not gone away, but in this world, in the pallet world, anyone, I have been in this
Warren Kruger: They have not gone away, but in this world, in the pallet world, anyone, I have been in this business 25 years.
Eric Nickerson: Hello
Warren Kruger: business 25 years.
Eric Nickerson: Let me broken up. I am sorry.
[Analyst]: Let me broken up. I am sorry.
Warren Kruger: It is a long sales cycle.
Warren Kruger: It is a long sales cycle.
Speaker #4: Yeah. But I guess the thrust then of your revenue recovery mode is to try to become another big player in leasing? Am I right?
Eric Nickerson: Yeah. But I guess the thrust then of your revenue recovery mode is to try to become another big player in leasing. Am I right?
[Analyst]: Yeah. But I guess the thrust then of your revenue recovery mode is to try to become another big player in leasing. Am I right?
Speaker #3: That's one aspect of it. Yes. We think that leasing we think there are opportunities for pallets and leasing industry, most certainly. IGPS has proved that.
Warren Kruger: That is one aspect of it, yes. We think there are opportunities for pallets in the leasing industry. Most certainly, iGPS Logistics has proved that.
Warren Kruger: That is one aspect of it, yes. We think there are opportunities for pallets in the leasing industry. Most certainly, iGPS Logistics has proved that.
Speaker #4: Okay. All right. Thanks. That's all I have. Thanks very much.
Eric Nickerson: Okay. All right, thanks. That is all I have. Thanks very much.
[Analyst]: Okay. All right, thanks. That is all I have. Thanks very much.
Speaker #3: You bet. Thank you.
Warren Kruger: You bet. Thank you.
Warren Kruger: You bet. Thank you.
Speaker #1: And as a reminder, if you would like to ask a question, you can signal by pressing star one at this time. And we'll pause for just a moment to allow everyone an opportunity to signal.
Operator 2: As a reminder, if you would like to ask a question, you can signal by pressing star one at this time. We will pause for just a moment to allow everyone an opportunity to signal. Mr. Kruger, it appears there are no further questions at this time.
Operator: As a reminder, if you would like to ask a question, you can signal by pressing star one at this time. We will pause for just a moment to allow everyone an opportunity to signal. Mr. Kruger, it appears there are no further questions at this time.
Speaker #1: And Mr. Kruger, it appears there are no further questions at this time.
Speaker #3: Great. Again, if anyone wants to reach out to me, at any time, please do so. Brendan, do you have any comments?
Warren Kruger: Great. Again, if anyone wants to reach out to me at any time, please do so. Brendan, you have any comments?
Warren Kruger: Great. Again, if anyone wants to reach out to me at any time, please do so. Brendan, you have any comments?
Speaker #2: No. I think we've covered everything. I was going to reach out about the pallet thing. I mean, maybe one thing just to give people an idea of the scale.
Brendan Hopkins: No, I think we've covered everything. I was going to reach out about the pallet thing. Maybe one thing just to give people an idea of the scale of the recycling and re-pelletizing. I believe in a conversation you and I had a few months back, you were talking about millions of pounds. Is that the type of size orders you're seeing on these re-pelletizing?
Brendan Hopkins: No, I think we've covered everything. I was going to reach out about the pallet thing. Maybe one thing just to give people an idea of the scale of the recycling and re-pelletizing. I believe in a conversation you and I had a few months back, you were talking about millions of pounds. Is that the type of size orders you're seeing on these re-pelletizing?
Speaker #2: Regarding recycling and repalletizing, I believe in a conversation you and I had a few months back, you mentioned millions of pounds.
Speaker #2: Is that the type of size orders you're seeing on these repalletizings?
Speaker #3: Yeah. There's we've in the past, when we are probably our most our largest year, we probably reprocess over 50 million pounds. And we were using it for our own consumption.
Warren Kruger: Yeah. In the past, when we are, probably our largest year, we probably reprocessed over 50 million pounds, and we were using it for our own consumption. Right now we have capacity to do so. We will quote on a bunch of that business in the future. Yeah, and the opportunity is large. It's also, you have to understand that there are other people that are in the reprocessing business out there processing it. We have not been in the business for many, many years, so we're breaking back into something we haven't been into in years. It will take some time, as with all things.
Warren Kruger: Yeah. In the past, when we are, probably our largest year, we probably reprocessed over 50 million pounds, and we were using it for our own consumption. Right now we have capacity to do so. We will quote on a bunch of that business in the future. Yeah, and the opportunity is large. It's also, you have to understand that there are other people that are in the reprocessing business out there processing it. We have not been in the business for many, many years, so we're breaking back into something we haven't been into in years. It will take some time, as with all things.
Speaker #3: And so right now, we have capacity to do so. And so, we will quote on a bunch of that business in the future.
Speaker #3: Yeah. And the opportunity is large, but it's also you have to you have to understand that there are other people that are in the reprocessing business out there processing it.
Speaker #3: And we have not been in the business for many, many years. So we're breaking back into something we haven't been into in years. So it'll take some time, as with all things.
Speaker #2: Okay. Are you comfortable? I believe you threw out a number on a profit per pound, I believe, or maybe it was per ton. I can't remember.
Brendan Hopkins: Okay. I believe you threw out a number on a profit per pound, I believe, or maybe it was per ton, I can't remember. Is that something you could share? Just for people who can imagine a perfect world.
Brendan Hopkins: Okay. I believe you threw out a number on a profit per pound, I believe, or maybe it was per ton, I can't remember. Is that something you could share? Just for people who can imagine a perfect world.
Speaker #2: Is that something you could share? Just for people who couldn't imagine a perfect world.
Speaker #3: Truckload quantities are about 42,000 pounds. And if you are if you're processing that type of material, the material is going to be at oh, it's going to be in the 35 to 40 cent range per pound for a customer.
Warren Kruger: Truckload quantities are about 42,000 pounds, and if you're processing that type of material, the material, it's going to be in the $0.35 to $0.40 range per pound for a customer. They provide the resin. To process it, you get a processing fee. The processing fee, it's not humongous, but it's $4,000 to $5,000 a day per machine. It can add up. It's something that we're doing in the interim while our pallet sales come back on. We do have the best product line in America in pallets. We've got a beautiful pallet line that includes probably 30 different SKUs. We need to focus, and that is my entire focus is sales, sales.
Warren Kruger: Truckload quantities are about 42,000 pounds, and if you're processing that type of material, the material, it's going to be in the $0.35 to $0.40 range per pound for a customer. They provide the resin. To process it, you get a processing fee. The processing fee, it's not humongous, but it's $4,000 to $5,000 a day per machine. It can add up. It's something that we're doing in the interim while our pallet sales come back on. We do have the best product line in America in pallets. We've got a beautiful pallet line that includes probably 30 different SKUs. We need to focus, and that is my entire focus is sales, sales.
Speaker #3: So they'd provide the resin and to process it, you get a processing fee. And the processing fee, it's not humongous, but it's 4 to 5 thousand dollars a day per machine.
Speaker #3: So it can add up. And it's just something that we're doing in the interim while our pallet sales come back on. Because we do have the best product line in America in pallets.
Speaker #3: We've got a beautiful pallet line that includes probably 30 different SKUs. And we need to focus, and that is my entire focus—sales, sales, sales.
Speaker #3: Because that's what we'll do it for—getting some of these customers on board, getting some of the leasing customers on board, and getting Walmart to continue to buy product from us.
Warren Kruger: Because that's what will do it for us, is getting some of these customers on board, getting some of the leasing customers on board, getting Walmart to continue to buy a product from us. We are working on our fire retardancy. Throughout the years, fire retardancy has been something that risk managers within organizations will often say, "I need a fire retardant plastic pallet." We've stayed away from that for years and years, but we actually have done some testing on this because of the chemical changes, and the AI has helped in putting formulations together. We've actually passed our fire test in a simple form, and we're set to do some large-scale testing. We're optimistic about that because that's the type of thing, Costco won't utilize plastic pallets unless they have a UL rating.
Warren Kruger: Because that's what will do it for us, is getting some of these customers on board, getting some of the leasing customers on board, getting Walmart to continue to buy a product from us. We are working on our fire retardancy. Throughout the years, fire retardancy has been something that risk managers within organizations will often say, "I need a fire retardant plastic pallet." We've stayed away from that for years and years, but we actually have done some testing on this because of the chemical changes, and the AI has helped in putting formulations together. We've actually passed our fire test in a simple form, and we're set to do some large-scale testing. We're optimistic about that because that's the type of thing, Costco won't utilize plastic pallets unless they have a UL rating.
Speaker #3: We are working on our fiery tartancy that's been discussed throughout the years. Fiery tartancy has been something that risk managers within organizations will often say, "I need a fiery tartan plastic pallet." We've stayed away from that for years and years, but we actually have done some testing on this because of the chemical changes, and the AI has helped in putting formulations together.
Speaker #3: And so we've actually passed our fire test in a simple form, and we are set to do some large-scale testing. We're optimistic about that because that's the type of thing—Costco won't utilize plastic pallets unless they have a UL rating.
Speaker #3: So we believe there is a big opportunity on the Costco side. We don't believe it. I know it because I've talked to them. And so we're pursuing that hot and heavy manner.
Warren Kruger: We believe there is a big opportunity on the Costco side. We don't believe it. I know it because I've talked to them. We're pursuing that in a hot and heavy manner. Brendan, anything else?
Warren Kruger: We believe there is a big opportunity on the Costco side. We don't believe it. I know it because I've talked to them. We're pursuing that in a hot and heavy manner. Brendan, anything else?
Speaker #3: Brendan, anything else?
Speaker #2: No. I'm good. Well, maybe one just piece of color. You mentioned how much you could process with those machines. I know it's not fresh new sales, but didn't you mention having a half a dozen of those machines or something like that?
Brendan Hopkins: Well, maybe one just piece of color. You mentioned how much you could process with those machines. I know it's not fresh new sales, but didn't you mention like having like a half a dozen of those machines or something like that?
Brendan Hopkins: Well, maybe one just piece of color. You mentioned how much you could process with those machines. I know it's not fresh new sales, but didn't you mention like having like a half a dozen of those machines or something like that?
Speaker #3: Oh, yeah. We've got grinding and granulating machines, and we've got four processing lines that we can BB. So they're actually we keep them pretty busy.
Warren Kruger: Oh, yeah. We've got grinding and granulating machines, and we've got four processing lines that we can be. They're actually, we keep them pretty busy. It's a good thing. We process for our own use, and now as I've mentioned to you and as Hugh's mentioned, we're processing for someone else. We do have some capacity left over, though, and these are all things that we're exploring and pursuing.
Warren Kruger: Oh, yeah. We've got grinding and granulating machines, and we've got four processing lines that we can be. They're actually, we keep them pretty busy. It's a good thing. We process for our own use, and now as I've mentioned to you and as Hugh's mentioned, we're processing for someone else. We do have some capacity left over, though, and these are all things that we're exploring and pursuing.
Speaker #3: So it's a good thing. We process for our own use, and now, as I've mentioned to you, and as you've mentioned, we're processing for someone else.
Speaker #3: So we do have some capacity left over, though, and these are all things that we're exploring and pursuing.
Speaker #2: Okay. I'm good.
Brendan Hopkins: I'm good.
Brendan Hopkins: I'm good.
Speaker #3: I'm good too. If anybody needs anything from me or from Brendan, just give us a call. We'd be happy to discuss it with you.
Warren Kruger: I'm good too. Anybody, if you need anything from me or from Brendan, just give us a call. We'd be happy to discuss it with you. Thank you.
Warren Kruger: I'm good too. Anybody, if you need anything from me or from Brendan, just give us a call. We'd be happy to discuss it with you. Thank you.
Speaker #3: Thank you.
Speaker #1: Thank you. This does conclude today's GREYSTONE Q4 results conference call. Thank you for your participation. You may now disconnect.
Operator 2: Thank you. This does conclude today's Greystone Q4 Results Conference Call. Thank you for your participation. You may now disconnect.
Operator: Thank you. This does conclude today's Greystone Q4 Results Conference Call. Thank you for your participation. You may now disconnect.
Eric Nickerson: The host has ended this call. Goodbye.
