Greystone Logistics Inc (QB) (GLGI) 銘柄情報

I hope the company is buying back some shares down here. Volume has been pretty big the last two days.

Thank you! That makes me feel better about things.

Warren Kruger

Good afternoon, and welcome, everyone. Thank you very much for joining. I just -- this will be a relatively short call. We actually had the K call just, gosh, we're 30 days ago. But I do want to talk about the first quarter. We had [indiscernible] in revenue. We ended with operating income of $824,000. This is something that -- well, I'll get into it in a moment. We had an income per share of $0.01 a share. So let me tell you where we are. People were on the of the K call, we are in a -- really in a lull. I haven't experienced this really since 2020. And even in 2020, we were actually quite busy in 2020.


This year, and I'm talking about the calendar year now, it has been really -- we are in an economic recession for the manufacturing sector. And I'm in touch with a lot of people in the manufacturing side, and we are there. Orders are off. Across the board in the thermoforming industry, the extrusion industry, the injection industry. It's just really -- I think that people are a little unsure as to where they are. Ford, General Motors, those companies, they're not really moving forward on some new models. We've had Stellantis close -- I mean, layoff people. Deere, John Deere is moving some people really affected things. Walmart, who's a big customer, they're closing stores. Walgreens, CVS, Dollar Store. It's really been -- I think really hasn't been talked about enough, but it has affected us.


Now that being said, the -- I'm not going to gloss over anything. I'm going to tell you how I believe it is. So I'm very disappointed with the numbers for the first quarter. And our sales were really off about $1.4 million under where I thought they'd be on a monthly basis. And that's a combination of things. Last year, we were -- we have a new mold that we designed in concert with Walmart. And they made some ergonomic changes and some weight changes. And that was about 120 days later than what we anticipated. But I was just in a DC, Walmart DC on Tuesday of this week. They love the product. We've put in about 44,000 pallets in that DC. They love them. They've had 44,000 and they had three broken ones. And while we walked around, we fixed two of the broken ones. So it wasn't broken. It was just a leg out of a slot.


So it's a product they're really happy with, and they are -- I anticipate our growth with Walmart to continue to flourish. As a matter of fact, I'm so bold about that that I've actually ordered another tool, and we call it the warehouse tool, but it is a very good tool. Walmart has 35 different distribution centers. We've probably put pallets in 3 now. So we've got a long run with them ahead of us, and we're excited about that.


I'm also disappointed in our extrusion business. We spent quite a bit of money acquiring the extrusion equipment quite some time ago now. So we're about 9 months behind the -- where I'd love to be there. That we -- Toyota, we've actually made our product for Toyota, our test sample products for Toyota. Toyota loved it. This is for their export, and it's something that they looked at prior to us acquiring the equipment and changing the design on that extrusion pallet. And I encourage everyone to go to our website and look at our welding line. It's on -- it's under Investor Relations, I believe. And if you go to the video, it's quite nice of our automatic line that will weld the extruded pallet for us.


We are really excited about that. And we got into this business because Uline had requested a 48x96, a very large pallet. And that's -- and Uline is a customer of ours, and we provide our 48x48 product there for them. So we are building a -- having a welding equipment manufactured right now to go in concert with our line, our automated line. Our automated line can only go up to 60x60. So to accommodate the Ulines of the world and others that have any sizes over 60 inches, we have a welding line that is almost complete. They're actually doing some testing at the end of this month. So I'm excited about that. But be that as it may, we are not getting any revenue that we anticipated out of that.


We've also shipped our 44x56 can pallet back to our mold maker overseas because it had some adjustments that needed to be made. And so our -- my can -- we have an old 44x56 that we sold. Our new one is a much, much better tool. But we've got customers now that it's probably about 6 months behind the curve. So it sounds like a [ Lemony Snicket ], but it is. We've got orders that are down. We've got some products -- some new products that I anticipated hitting the market that aren't -- that haven't hit the market. But the good news is we've got -- IGPS is very happy, and our relationship there is great.


Our relationship with Walmart is on the uptick and is very, very, very good. And we've got Toyota and many others ahead of us. So our pipeline is like $100 million in revenue. We've just got to get people ordering.


So I want to open it up for questions now. And hopefully, I can answer. One thing I do need to mention now at this point too, we -- I have been spoiled for 22 years. I had a wonderful CFO; Bill Rahall, he's not only a fantastic CFO, he's a fantastic human being. And at 83 years old, he said, hey, Warren, I can't do this. My wife wants me at home. So we did hire our recent CFO, was late on our Q, was late on our K. So I've -- we've actually released him, and we're in -- right now, we're looking for a new CFO.


So that's been a little stumble in our guide app as well. But I can answer also financial questions for you, and we'll just open it up for questions.

Operator

[Operator Instructions] We'll take our first question from Brad Ball.

Unknown Analyst

Warren, I understand the economic recession side of things. But I'm a little concerned, you've gone through a couple of CFOs. You announced a buyback in June. The quarterly results were less than encouraging. The conference call today, no real notification, still not on there. I'm probably the only guy on it. Have you given some insight as to how tough things are or maybe disappointment in terms of ordering? Is there any other encouraging words you can give us? Or where is the buyback as it stands now? Actually, it works in your favor, I think, with the stock price down 30% plus. Any other things you can fill us in on that are encouraging?

Warren Kruger

Yes, I will say. I've been in this business now for 22 years. And the first year, we had $600,000 sales, and we track $4 million to $5 million a month now. So the encouraging thing is this is a business that's not going away. It's a business that there are there are millions and millions. As a matter of fact, the numbers are astronomical. They anticipate 2 billion pallets are in America and 800 million going in the system each year. I can tell you that every time I go into like a Walmart, I'm very encouraged because they have so much wood in one facility and then there's 35 facilities. It just goes on and on and on and on and on but it is getting the sales. The sales cycle is sometimes a lot longer than what we anticipate.Â


I do – we do, the buyback is still as a matter of fact, I had a call on the buyback today. We had to wait until after this Q was filed, which is done. We actually -- I need a letter. There are 2 things that they needed; they needed a letter from our attorney, which our attorney had talked to them yesterday, they're working on. The second thing they needed was some corporate documents that I need to get to them. Besides that, we will be in the market, and we'll be acquiring some shares. I will say that I have to take this.


The buck stops on my desk, and I hired a CFO for the local market in Iowa. I mean I wanted someone there. I did this in concert with my old CFO. So we acquired the gentleman, he came in and he was disruptive. He did not our corporate culture. He wanted to disrupt our corporate culture. It was very, very difficult for him, for me and for my really loyal people up there. It was very difficult. So I couldn't have that.Â


So we released him. And then I knew that Bryce Dilly, who I've known for some time, he was kind of at the end of his career, and he was CFO kind of have gun will travel kind of CFO. So we wanted to use him for a year until we got a nice young guy in there that could take us when we uplist and be with us along the way. And Frankly, I mean, I'm giving you excuses. I don't really accept excuses. So I'm just telling you the truth. So I just said, hey, I can't be late on these. So I'm outsourcing that with a top 10 firm that will be helping us with our Qs and Ks, so I don't have that problem again. I will find a good CFO. I've got a lot of people looking, and I actually have a search firm looking as well. We'll find the right person and the right fit. So that kind of takes care of those.Â


In terms of the notification, the CFO generally handles that, and it was something that I should have talked with Brendan Hopkins about. He and I talked about it. And it was like we didn't mention it to one another. And so when the notification didn't get out because we didn't have a CFO. So it was scrambled around. So again, I'm telling you the truth as it is, and the buck stops on my desk. Believe me, Brendan and I learned a lesson this time but I've never gone through late Qs and late Ks. So these are all new experiences to me, and I will tell you that I don't like it. In terms of where we are on growth side, we need to be bigger. I acquired $7 million to $9 million, $7 million to $10 million worth of new equipment for our growth phase in which we have not done.Â


That's on me, and it's paramount of me to add sales and so I'm disappointed. I will tell you, it's for no lack of effort. We have, like I said, a lot in the pipeline. We just don't have the orders coming in. I had an entire quarter. One of my big customers had an entire quarter I didn't get one order from last quarter. I mean, this June, July and August, very unusual. And it's just people are holding off. So that's the truth as I know it, but I will tell you, this company is headed north. It's not headed south. We are going to grow this company, and I am motivated to take care of my shareholders and my employees. So I will tell you that this has been, like I said, a disappointing quarter for me, but I am optimistic about where we are long term.

Operator

Our next question comes from Anthony Perala.

Anthony Perala

Warren, to chat with you again here. Just a couple of clarifying points from your commentary. So you mentioned the Walmart kind of the mold that they wanted some of those ergonomics on. So was that not shipping in the fiscal first quarter?

Warren Kruger

We did get some of that. Yes, we were shipping in that first quarter. So I was talking about more this year. But yes, indeed, we did ship to Walmart. As a matter of fact, we're on a good track with them and now it's on a steady Eddie every week for them, and that's one of their DCs. And we have a lot of the same product now that we've sent out to multiple other DCs across the country. And we just haven't sent out.


We have our former plant manager, Ron Skellhas, who I've worked with for 20 years. Ron is out there on the road actually full time. And Ron is -- he is actually delivering these things out to Walmart DCs. And so it's, he's very good with customers. And I've got -- I anticipate that our growth with Walmart will continue because we have a good product for them, we have a need, an itch that we're scratching for them. And I wish you could have been with me yesterday when I was in Elwood, Illinois at the DC because the comments that came back from them just it's very, encouraging because they're at the end of every aisle, they have a red bucket, a red garbage can. And in that red garbage can, it says wood on the side. And all the -- just filled with wood, wood pieces from all the wood pallets that break in the facility. And this is daily, and it just drives them crazy.


And then they've got a sweeper truck going around the huge facility around the clock just because of all the dust from the wood. And the encouraging thing is all the positive comments about how much less it is now after about a 25% of fill in that facility. So I'm very, encouraged by that. And we have the gentleman there that we're working with they're talking to their compatriots across the country about what they're doing. So I hope to be able to create a transfer pallet for them that not only do they keep the pallets within their facilities, but when they're transferring between one DC and another, they're using their own transfer pallet. So we're working that hard because they're a great customer.

Anthony Perala

That's great. Is there -- so is it on kind of a DC-by-DC basis that the decisions are made? Or is there one purchasing decision across all these 35 DCs? Just kind of who you have to convince for the sale for the other 32 that you don't have your pallet into?

Warren Kruger

It's really it's funny. Walmart, there's autonomy there. Each DC kind of makes their own moves based on where they are. There are import DCs. There are retail DCs. There are food DCs. There are regional distribution DCs. So a variety of different types. And on the regional DCs, they're doing a lot more automation, and they're picking goods up now more by clamping and trying to move goods very quickly because time is money with them, and it also means employees -- less employees.


And so consistency of product really makes a difference. When you're transferring from a plastic pallet onto a wooden pallet or it's, or from a wooden pallet to a wooden pallet, it can be very, very cumbersome, because there'll be a board or there'll be a nail sticking up. And when they're doing it from plastic to plastic, it really works easy and speeds up the time and the clamping is easier. And so I am encouraged by what I'm seeing there because it's what we've been talking about for 20 years, and it's really happening a lot. So it's good.

Anthony Perala

Yes. That's great to hear. On the Uline, that kind of that larger pallet, just curious if there's a ballpark of once you're able to service them, give them that, what was it, 48x96 pallet that they want, just kind of what kind of revenue opportunity that could be on either a quarterly or annual basis for you guys?

Warren Kruger

I will tell you, I'm going to be honest. I'm not going to venture that guess right now. I could, and I don't know, I'm sorry to say, I don't know what the 48X48 that we moved through there. But I do know that we -- Uline, we've moved quite a little product through there. They came to me at a show and said, hey, Warren, we're looking for a 48x96. And he said, the only one we can find out there is a PVC 48x96, and it's a very expensive product. So this is for, let's say, moving a mattress or moving doors or moving a large piece of glass and so forth.


That's the type of thing where they can wrap it up. And we will have, now that we have production on our extruded pallet that we're testing, we will have in the next 2 weeks, I'll have something on my website that will show the product and what it looks like and so forth. It's basically hollow lumber. That's what it is. And it's hollow lumber that what I like about that is it fills small niches. So someone needs 2,000. Well, if I don't have something that size, when we buy molds, our molds are $300,000 to $400,000, $500,000 a piece. And so you really can't when someone wants an odd size, it's a one-off and you miss all that opportunity. Well, with the extruded board, you just make the extruded product to that size, you cut it to that size and then you weld it to that size.Â


So we, theoretically, we can do any size up to 60x60 that is automated -- on our automated line. And then on our larger line because of this welding equipment, we'll be able to take the pieces and make them on our larger welding machine. And in addition to that, we've designed the product with a 2x4 that can actually -- we can put one of our fiberglass rods in there. If someone needs some type of strength or if it's bowing -- we can put fiberglass rods in there that will give it strength so that it has bone structure.


So I'm excited about it, but I hate to say I just can't venture a guess at this time. But I will also tell you that this 48x 96, it's the kind of thing at a trade show where Mathis Brothers, the big furniture manufacturers and sellers, they come by the booth and say, hey, do you have a 48x96 pallet we can put our mattresses on or our box springs on. And it's odd. So I'm encouraged and at the show, we have the PA Expo coming up the first part of November, and we will be introducing the extruded pallet at that show.


And I anticipate that we will really see what kind of interest will be shaking up. And I hope to tell you on the next quarterly call, I hope to give you an estimate on that because I'd be able -- I will be making a 48x96 within the next 2 weeks as a test product. And we'll be going to Uline and we'll be showing them that product. So I hope to have more information for you on that in another 90 days.

Anthony Perala

Excellent. Yes, that seems like a nice -- another tool in the tool belt. Just one last one here. CapEx, capital expenditures were a little higher than I had expected in the quarter. Was there anything to do with the rebuild of the warehouse or anything that drove that $3.3 million number this quarter?

Warren Kruger

And I will tell you off the top of my head, there's -- we have just had a chiller. I know that we had to do a new chiller, and that probably was this quarter and that was not equipment -- that was not mold related or machine related. It was just operating related. So, it was really -- it was in that operating CapEx type thing. But other than that, there was no other -- maybe the welding equipment I'm doing for the -- that probably showed up the welding equipment that I'm doing for the extrusion line. And I also bought a CNC machine because on these hollow lumber, some people want 4-way entry. So, you have to make a slot on the 48-inch side so that you can put a fork tired through there. So, some of that equipment was kind of an unusual for the quarter. But I don't anticipate making a big capital expenditures the rest of this year.

Anthony Perala

Okay. So you'll stay kind of around what you've described as maintenance CapEx previously?

Warren Kruger

Yes. We do have some molds on order. I mentioned another warehouse mold, and we'll have the fix on the 44x56 that we'll have to pay for. I may order -- I'm waiting on 2 other orders for an odd size 43x37 that I'm encouraged, but I don't have a purchase order there yet, and I'd make a new tool for that. And then there's a 43x43. We're waiting on an order from that from a big customer. And I'll probably order as soon as I get a PO, then I'll order a tool for that.

Anthony Perala

Okay. Sounds great. I guess it might last point just more be a comment. But if you look kind of the last year, I appreciate you taking your flogging and responsibility for kind of results that are an up tier measure. But last year, kind of as growth capital expenditures have fallen off, I think, highlights the cash generation ability of the business at this level, which leaves quite a bit of cash left over for shareholders after debt requirements and the like. And I think you're going down the right track, returning some of this to shareholders, and that can allay some of the other concerns that might be out there and help with the stock price and multiple over time. So, look forward to catching up with you again in 90 days here.

Warren Kruger

Good, good. Well, and I will say we're sitting on -- we sit on $4 million to $5 million in cash. We did pay cash. As I think I mentioned on the Q call, we paid like $1.6 million and $1.650 million cash for a new piece of real estate that's within 0.5 mile of our facility, which we intend long term to build a warehouse there to replace the burned warehouse that we had that was 35 minutes away. But -- so we used up some of our cash. But we're creating cash, and we're sitting on $45 million usually now all the time.

Operator

Our next question comes from Joe Marcus.

Unknown Analyst

Yes. I really didn't have a question per se. I just wanted to state a feeling. I have been with this company almost ever since Warren took over the company. And I have never in a 50-plus year career in this industry seen management as good, competent and dedicated as Warren and the team that he has built around him. I have seen many, many cycles where the company spurts forward, then retrenches a little bit, goes on to new and different products. One quarter may not live up to the expectations for that quarter, but the trajectory of this company has always been tremendously, tremendously higher.


Warren has, with his group, built a new industry in plastic pallets, plastic pallets are an absolute necessity and will absolutely replace all wooden pallets moving forward in our industrial economy. And I mean this is -- this company is a rocket ship to success. So basically, people who are shareholders in Greystone need to be patient, need not to look at the small isolated picture of 1 quarter, but need to look at the overall trajectory of this company.


This company has got a clear present and future path to greatness and basically, you've got to look at this company on a trajectory as opposed to looking at it in simple little 90-day increments, okay? This is what Greystone Logistics is. So, Warren, thank you for everything you've done. Thank you for everything you're going to do.


The CFO transition has been a little bit rough, okay, things happen. I mean, there was only one perfect person in the world, and he got nailed to across. So basically, okay, there's a little CFO glitch will resolve itself, and this company will resume the trajectory to where this company is going to go, which is high...

Operator

[Operator Instructions] It appears that we have no further questions. At this time, I'll turn the program back to our presenters for any closing remarks.

Warren Kruger

I just want to tell everyone, I really appreciate you guys being on the call. I appreciate you being shareholders. I do -- I will tell you that our people who are wonderful staff work very hard every day. The comments that we get -- I love the comments that I get when I'm out there and people say, gosh, your people are so nice. And it makes -- it really makes it nice. I had a gentleman who had been at 53 -- he lived in 53 different cities and worked -- he was -- worked with Walmart. And he came into our facility and he said, I can tell just when you walk into a facility, what it's going to be like by the people, how they act, how they treat you and then by when you go out and you look at how clean the place is and I took him over to our recycling center, he said, I've never seen anything like this in a recycling center.


Because we take pride in making it look good and being efficient and effective, and we have dedicated hard-working employees. So, I know that I want to get to the same spot you guys want to get to, and that's -- let's make a lot of money and let's do it in the right way and use 100% recycled plastic and make this world a better place. So, thank you very much.

Did anyone listen to the call? WTF is up with announcing the call less than 2 hours before it begins?

Disappointing quarter.

The interim CFO was terminated yesterday. That makes two CFOs gone this year. I wonder what’s going on.

While they're at it, maybe don't report hours after the close on a Friday.

Not sure who is writing the earnings releases, but I wish they’d just report the numbers and leave out the rah rah bs…”impressive net income”, “strong earnings”, etc.

Wtf does, “ The $.16 per share earnings highlights its resilience and commitment to innovation in a challenging economic climate” even mean?

You’re not reporting an inspirational tale of derring-do, you’re reporting earnings for a pallet company.

Yeah, hopefully we’ll see some sales growth this year. I’d think the warehouse fire would’ve helped GM, as they had to replenish the inventory, thus spreading the fixed costs over more units.

Pretty remarkable that they now have almost $10 million of working capital. When I first bought this, it had negative equity, let alone working cap.

Decent qrtr from glgi. Got gms back up. Ebitda of 2.8mn. 2.9mn fcf. 10mn fcf for the year. Nothing in the k about wmt new contract. Hope that they are banging out pallets for them as we speak.

Another fat finger? I haven't seen the 10-k released yet.

I think Friday might have been the all-time high close for the stock.

up up and away, with the new pallet contract with wal mart and the buy back, i can see 2 dollars a share, the ceo is all about having a higher share price also, this was discussed on the past earnings calls.

$1 million buyback starting in Q2.

Warren presented at a conference this week:

https://www.otcmarkets.com/stock/GLGI/news/Keynotes-Educational-Panels-and-96-Companies-to-Present-at-the-Planet-MicroCap-Showcase-VEGAS-on-April-30---May-2-2024-a?id=438483

You can click the link and hear the presentation. Not much new information, but I thought he did well.

I don't think the selloff is due to the ERC comparison, but rather worries about the gross margin....going from >20% to 13% in Q3.

I'd guess there's also worry about the missed deadlines with regards to the Wal-Mart tool and the extrusion pallet line. Maybe some other worries about the new CFO leaving only after 9 months....I'm surprised there wasn't a question about that on the call.

My feeling is that the market is in show-me mode. I'm happy to hold though, as margins are still 19% for the year, and the other issues are presumably just speed bumps. I'm guessing the pipeline is still filled with the opportunities that Kruger was talking about on the Q2 call.

$4.25 million of sales for a single distribution center is also not too shabby....Wal-Mart has 210 of those things in the US.

If they're serious about buying back stock, this selloff is actually a good thing.

if the stock goes any lower will have to reload... during the earning report they actually had a better qtr than the comparison qtr. just got some covid money in the previous qtr. good luck to all

Greystone Logistics, Inc. Reports Results of Operations for the Nine and Three Months Ended February 29, 2024
Press Release | 04/17/2024
TULSA, Okla., April 17, 2024 (GLOBE NEWSWIRE) -- Greystone Logistics, Inc. (OTCQB:GLGI) Tulsa-based Greystone Logistics, Inc. reports results of operations for the nine months and the three months ended February 29, 2024.

Greystone reported earnings per share of common stock for the nine months ended February 29, 2024 of $0.09 compared to $0.16 for the prior period. Net income was $3,006,974 for the nine months ended February 29, 2024 compared to $4,881,990 for the nine months ended February 28, 2023 which included other income of approximately $3.2 million from realization of federal tax credits and a gain from deconsolidation of a variable interest entity. EBITDA for the nine months ended February 29, 2024, was $9,660,949 compared to $10,109,572 for the nine months ended February 28, 2023.

Earnings per share of common stock for the three months ended February 29, 2024 were $0.01 per compared to $0.13 per share. Net income for the three months ended February 29, 2024 and 2023 was $297,929 and $3,695,496, respectively.

Sales for the nine months ended February 29, 2024, were $46,990,716 compared to sales of $44,633,542 in the prior period. Gross profit margins were 19.2% and 13.5% for the nine months ended February 29, 2024 and 2023, respectively.

Sales for the three months ended February 29, 2024, were $13,980,009 compared to sales of $13,578,269 in the prior period.

“Credit goes to our employees for the continued progress in the current fiscal year,” stated CEO Warren Kruger. “Our sales team is working diligently filling our pipeline with business from existing and new customers. Unexpected delays in delivery of new molds have created a delay in fulfilling purchase orders for customers. Delivery of the new molds is expected to occur in the latter part of the year thus realizing the utilization of the two new large tonnage injection molding machines and the robotic extrusion line to manufacture hollow extrusion pallets. Greystone is well positioned for our continued growth cycle, including our products for selected markets - grocery, can, nut, cement, tech and beverage industries.”

Greystone Logistics is a "Green" manufacturing company that reprocesses recycled plastic and designs, manufactures and sells high quality 100% recycled plastic pallets that provide logistical solutions for a wide range of industries such as the food and beverage, automotive, chemical, pharmaceutical and consumer products. The Company's technology, including a proprietary blend of recycled plastic resins used in the injection molding equipment and patented pallet designs, allows production of high quality pallets more rapidly and at lower costs than many other processes. The recycled plastic for Greystone’s pallets helps control material costs while reducing environmental waste and provides cost advantages over users of virgin resin.

This press release includes certain statements that may be deemed "forward-looking statements" within the meaning of the federal securities laws. All statements, other than statements of historical facts that address activities, events or developments that the Company expects, believes, or anticipates will or may occur in the future, including the potential sales of pallets or other possible business developments are forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, including the ability of the Company to continue as a going concern. Actual results may vary materially from the forward-looking statements. For a list of certain material risks relating to the Company and its products, see Greystone Logistics' Form 10-K for the fiscal year ended May 31, 2023.

Conference Call - Wednesday, April 17, 2024, at 2:00 PM ET, hosted by Warren Kruger, President and CEO. Conference ID is Greystone. Dial-in information is Toll-Free Number, 800-579-2543, or Direct or International Number, 785-424-1789. A Q&A session will be available.

Non-GAAP Financial Measure

This press release contains disclosure of EBITDA, which is a non-GAAP financial measure within the meaning of Regulation G promulgated by the Securities and Exchange Commission. A reconciliation of net income to EBITDA, the most comparable GAAP financial measure, as well as additional information concerning EBITDA, are included at the end of this release.

Greystone Logistics, Inc.
Reconciliation of Consolidated Net Income to EBITDA
For the Nine Months Ended February 29, 2024 and 2023
2024
2023
Net Income $ 3,006,974 $ 4,881,990
Income Taxes 1,375,000 452,000
Depreciation and Amortization 4,296,383 3,954,444
Interest Expense 982,592 821,138
EBITDA (A) $ 9,660,949 $ 10,109,572

(A) EBITDA represents income before income taxes plus interest, depreciation and amortization. The
EBITDA presented above, while considered the most common definition used by investors and
financial analysts, may not be comparable to similarly titled measures reported by other companies.
Greystone believes that EBITDA, while providing useful information, should not be considered in
isolation or as an alternative to other financial measures determined under GAAP.

Contact:

Brendan Hopkins
Investor Relations
Email: investorrelations@greystonelogistics.com
Phone: (407) 645-5295
https://www.greystonepallets.com



Primary Logo

The new CFO resigned on April 1 to "pursue other opportunities." Bill Rahhal resigned at the end of 2023, so the new CFO was only in charge for 3 months? Hopefully some light will be shed on the call (presumably) next week.

Looks like one of Greystone’s warehouses used to store inventory was destroyed by fire last month.

https://www.ourquadcities.com/news/local-news/camanche-warehouse-destroyed-by-fire/

There are hardly any shares short. I'm guessing someone put in a market order rather than a limit order.

The only news I've seen / noticed is that the 44 x 56 pallet that Kruger mentioned on the Q1 call is now up on Greystone's website, so they're presumably selling it. That's hardly earth shattering news though.

There has been a rash of low float runs happening in the last few days. This is likely another.

It looks like a short squeeze. There was a size of 1.20 and he pulled it up

Is this a fat finger or is there some news out there?

Wal Mart loves Greystone's pallets and a new applications in 70 to 90 days to even more profits from Wal Mart, just a matter of time before this stock gets to 2 dollars. don't miss the boat!

I was surprised to see this trade down during / after the conference call. Maybe I'm misreading it, but Kruger basically announced a 3-year contract with Wal-Mart, discussions with another "huge" customer (going as far as saying he thought they were going to place an initial order 60 days ago), and seemed confident on margins remaining high. They never put out a release regarding Simplot, but I imagine they're one of the 3 current "major customers."

I'm guessing people sold because of a "softer" Q3 and because he wasn't as confident now that FY 2024 sales would beat FY 2023. Seems a bit short-sighted to me.

I don't put a lot of stock (no pun intended) in the stock buyback announcement (volume's not high enough to buy in the market and who knows if any shareholders will offer to sell shares...maybe if Bill, the old CFO, wants to sell his shares now that he's retired), but it's definitely not a negative.

Yeah, if Kruger is correct about the 2nd half of the year being better than the first, then things are looking good.

Hoping to hear updates on Wal-mart, Ball and the beverage & fire retardant pallets.

Also, did you know that Cabka is publicly traded? It's nice to have another comparable company to look at. Kruger mentioned them as a tough competitor in one of the prior conference calls.

https://investors.cabka.com/

$3.2mn ebitda in November qrtr. Better than I was thinking given commentary about slower qrtr and Walmart not in there. Hoping to hear on tomorrows quarter that wmt pallet has been redesigned and ordered to see that rev uplift

Doesn’t mean anything. Year end adjustments or perhaps last minute loss capture. ‘Tis the season to not take much serious.

in a couple weeks will have an earnings report.. can't wait !!!

What's with the selloff today??

about a 50 pct run up in the stock price for 2023, not too bad. i expect good news from the company in 2024. should make the stock run to 2 bucks a share.

I enjoy reading the posts from you and Jimmyjohn,
Thanks

It’s at the option of the holder. https://www.sec.gov/Archives/edgar/data/1088413/000107261303001571/exh4-1_12224.txt

Assuming no hiccups, if they apply all the FCF to debt, they could have zero net debt in 12-18 months. If they're generating $15 million of EBITDA at that point, the current price would be 2x EV/EBITDA. If they are able to get closer to the $100 revenue mark and can maintain these margins, the multiple would obviously be even lower.

Do you know if the preferred has a mandatory conversion feature?

stock should be 2 bucks a share with a normal 10 Price to earnings ratio.

That's good to know, thanks.

I think they’re redesigning the Walmart pallet so I’m not sure if wmt was in there or not - think it may be a few months before wmt comes back. But Wmt is no longer prepaying for orders is my understanding

Did you notice that their website's "about" section now discloses the total # of pallets produced?

17,566,126 pallets from 2003 - 2022
5,473,584 beverage pallets from 2003 - 2022

It'll be interesting to see how often they update it. Maybe they'll be the McDonald's of the pallet industry (billions & billions served).

Yep, nice to see. I haven't gone back and calculated the ttm EBITDA, but I'm guessing if you exclude the preferred, gross debt is now less than 1x EBITDA. Working capital is also positive and margins are fantastic....quite a turnaround from a few years ago.

That's with presumably no sales to Wal-Mart (unless Wal-Mart is no longer pre-paying for its pallets). If they can start closing on some of the deals they talk about in the conference calls and work their way up to $100 million in revenue, this thing could really run.

These margins look really nice. $4.2mn ebitda and $4.5mn fcf with some working cap benefit. Paid down 2mn debt. Ebitda margins hit 24%

Earnings will be released on Tuesday morning.

I'm not advocating for it. The only reason I mentioned raising capital was if they are determined to list on an exchange.

I don't think a $30 million market cap company with ~50% insider ownership belongs on an exchange. If you exchange debt for equity (and do so where shareholders can participate and not be diluted), then the market cap is $50 million. Perhaps the shares also trade up due to the stronger financial position as well, increasing the market cap even more.

I also think a merger with KFI is the ultimate end game.

I agree - don’t think being uplisted matters for interest in the name. It’s possible they would do share repo to get px up for listing rules - which could be short term catalyst but likely negative longer term. The other thing which is in the back of my mind is merging with Kruger Family Industries to take KFI public (reverse merger type transaction). Could see that being positive for how GLGI shareholders get treated.

On a standalone basis, 4mn ebitda/qrtr should translate to 2.5mn fcf/qrtr as I think capex will be low, and given working capital should be a source if anything. So they could generate 10mn fcf over the next year to pay down debt. Would be a decent ROI also to your point. So I don’t maybe see why they would need or want to raise equity capital to pay down debt

Conference call was a good listen. Let’s hope they can close on some of the sales leads.

The uplisting talk still baffles me. I don’t see a point in uplisting if you’re going to be continuously battling the $1 minimum share price requirement.

The float and trading volume are not big enough to do a meaningful reverse split (ie one that gets you above $5/share).

I’d rather see them go the other way and deregister with the SEC. Continue to provide audited financials so the stock doesn’t go to the expert market, but save on the SEC related fees. Re-register with the SEC in a few years when (if) the company is large enough to trade on an exchange. Maybe the cost to deregister & reregister make this impractical though.

Alternatively, do a rights offering now to boost the float and then do a reverse split to boost the share price. Use the proceeds to pay down debt. They’ve done a nice job of deleveraging, but rates are so high that interest expense is still > 25% of operating income.

Yeah the MD&A suggests igps had trouble shipping them their resin - so hopefully they’re delivering that volume now. And yeah the cares act relief payments are nice on gaap eps but I’m excluding that from ebitda here. Think they got to 9.4mn ltm on ebitda. . Spent a ton on capex in qrtr which dragged fcf but that leaves very little left on purchase order obligations at year end. So hopefully they can put head down, fill machines and pump some fcf.

Kruger was expecting $65-70 of revenue in FY 2023, so to only hit $60 had to be disappointing. If it’s just pushed to FY 2024, no big deal though.

The tax credits certainly helped this year. Unfortunately, those were a one-time deal.

Decent qrtr but looks like they didn’t start ramping the igps extra volume until late and more coming in fy24. 3.4mn ebitda. Solid gross/ebitda margins.

Website has been updated, sort of.

https://greystonepallets.com/

earnings coming out tomorrow aug 29 at 7am est... i look for good things and i look for the stock to continue to move higher. GLTA