CARLISLE, IA--(Marketwire - January 20, 2009) - GreenMan Technologies, Inc. (
OTCBB:
GMTI),
today announced results for the three and twelve months ended September 30,
2008.
Lyle Jensen, GreenMan's President and Chief Executive Officer, stated, "We
are very pleased with the results of the fiscal year ended September 30,
2008 which marked our second consecutive year of improved performance and
the final stage of our three year turnaround of GreenMan. As previously
announced, on November 17, 2008 we completed the divestiture of our tire
recycling operations for approximately $27.5 million in cash. The sale of
that business enabled us to retire the majority of our outstanding
obligations, resulting in a virtually debt free balance sheet in what has
become a very tight credit market. As we report to you today, we present a
cash strong balance sheet and a renewed freedom to actively build
shareholder value as opposed to focusing on simply keeping our company
viable. We have established a new, stronger foundation for growth and we
believe GreenMan is well positioned to capitalize on new opportunities in
the development of recycled products and green-based technologies as we
move into 2009."
Mr. Jensen added, "Our Welch Products subsidiary, particularly the National
Playground Compliance Group ("NPCG"), made excellent progress during fiscal
2008 building relationships with state school board associations in Iowa,
Missouri, Minnesota and California and we anticipate that we will add new
state school board associations in 2009. Additionally, Welch was awarded a
Master Agreement from the state of Iowa to provide ADA and safety compliant
surfacing at 22 state parks and was selected to facilitate Iowa's Safe
School Surfacing Initiative in partnership with the Iowa Department of
Natural Resources and the Iowa Association of School Boards.
"The recently announced establishment of our new subsidiary, GreenMan
Renewable Fuels and Alternative Energy supports our strategic objective to
pursue opportunities to commercialize green-based technologies that convert
waste feedstock into bio-fuels and other waste-to-energy solutions. There
are many opportunities in the renewable fuel and alternative energy space
and we remain committed to following our guiding principles in pursuit of
appropriate partnerships towards our goal in increasing shareholder value."
Please join us today, January 20, 2009 at 10:00 AM EST for a conference
call in which we will discuss the results for the quarter and fiscal year
ended September 30, 2008. To participate, please call 1-877-718-5099 and
ask for the GreenMan call using passcode 5743380. A replay of the
conference call can be accessed until 11:50 PM on February 20, 2009 by
calling 1-888-203-1112 and entering pass code 5743380.
About GreenMan Technologies
GreenMan Technologies pursues technological processes and unique marketing
programs to transform recycled materials into renewable fuel, alternative
energy, recycled feedstock, and innovative recycled products. Through the
company's Welch Products subsidiary, the company develops and markets
branded products and services that provide schools and other political
subdivisions viable solutions for safety, compliance, and accessibility.
Our Renewable Fuels and Alternative Energy subsidiary supports our
strategic objective to pursue opportunities to commercialize green-based
technologies that convert waste feedstock into bio-fuels and other
waste-to-energy solutions. To learn more about all of the companies,
please visit the following websites:
www.greenman.biz,
www.welchproducts.com,
www.nssi-usa.com,
www.playtribe.com
In September 2005, due to the magnitude of continued operating losses, our
Board of Directors approved plans to divest the operations of our GreenMan
Technologies of Georgia, Inc. subsidiary and dispose of its respective
assets. Accordingly, we have classified all remaining liabilities
associated with our Georgia entity and its results of operations as
discontinued operations for all periods presented in the accompanying
consolidated financial statements. On June 27, 2008, our Georgia subsidiary
filed for liquidation under Chapter 7 of the federal bankruptcy laws in the
Bankruptcy Court of the Middle District of Georgia. As a result of the
bankruptcy proceedings, we have relinquished control of our Georgia
subsidiary to the Bankruptcy Court and therefore have de-consolidated
substantially all remaining obligations from our financial statements as of
September 30, 2008. On October 1, 2007, we acquired Welch Products, Inc.
in exchange for 8,000,000 newly issued shares of our common stock. The
results described below include the operations of Welch since October 1,
2007.
As previously disclosed, our business changed significantly in November
2008, when we sold substantially all of the assets of our tire recycling
operations. We operated these assets throughout the fiscal year covered by
this release and our Annual Report on Form 10-KSB so the following
discussion reflects the results of operations of this business segment
through September 30, 2008. Investors should understand, however, that our
current business excludes such operations.
Three Months Ended September 30, 2008 Compared To The Three Months Ended
September 30, 2007
Net sales for the three months ended September 30, 2008 increased
$2,532,000 or 39 percent to $9,039,000 as compared to the net sales of
$6,507,000 for the three months ended September 30, 2007. The increase is
primarily attributable to the inclusion of approximately $1,372,000 of
revenue associated with Welch, our newly acquired subsidiary. The remaining
increase in revenue was attributable to an 18 percent increase in overall
tire derived end product revenues during the three months ended September
30, 2008 and a 2 percent increase in scrap tire volume (we processed
approximately 3.73 million passenger tire equivalents during the three
months ended September 30, 2008 as compared to approximately 3.66 million
passenger tire equivalents during the same period last year).
Gross profit for the three months ended September 30, 2008 was $2,644,000
or 29 percent of net sales compared to $1,955,000 or 30 percent of net
sales for the three months ended September 30, 2007. The results for the
three months ended September 30, 2008 included Welch, which had a gross
profit of $347,000 or 25 percent of its net sales.
Selling, general and administrative expenses for the three months ended
September 30, 2008 increased $584,000 to $1,611,000 or 18 percent of net
sales, compared to $1,027,000 or 16 percent of net sales for the three
months ended September 30, 2007. The increase was attributable to the
inclusion of $417,000 associated with Welch, including a significant
investment in sales and marketing efforts to promote the Welch patented
products and establish market presence.
As a result of the foregoing, we had operating income from continuing
operations of $1,033,000 during the three months ended September 30, 2008
as compared to operating income of $928,000 for three months ended
September 30, 2007.
Interest and financing expense for the three months ended September 30,
2008, increased $114,000 to $510,000 compared to $396,000 during the three
months ended September 30, 2007. The increase was primarily due to the
inclusion of approximately $50,000 associated with Welch and increased
borrowings during the quarter.
We recorded a net benefit for income taxes of $5,385,000 during the three
months ended September 30, 2008 primarily due to the recognition of a
deferred tax asset of $5,300,000. As a result of the gain to be realized
in fiscal 2009 from the sale of the tire recycling operations, we expect to
realize the benefit of a portion of our federal net operating loss
carry-forwards and therefore have reduced our deferred tax valuation
reserve resulting in the recognition of the net deferred tax asset. During
the three months ended September 30, 2007 we recorded income tax expense of
approximately $84,000.
As a result of the foregoing, income from continuing operations after
income taxes increased to $5,761,000 for the three months ended September
30, 2008 as compared to income from continuing operations of $451,000 for
three months ended September 30, 2007.
During the three months ended September 30, 2007 we reached agreements with
several Georgia vendors regarding remaining past due amounts resulting in
approximately $186,000 of income from discontinued operations.
Our net income for the three months ended September 30, 2008, was
$5,761,000 or $.19 per basic share as compared to a net income of $637,000
or $.03 per basic share for the three months ended September 30, 2007.
Fiscal Year Ended September 30, 2008 Compared To The Fiscal Year Ended
September 30, 2007
Net sales for the fiscal year ended September 30, 2008 increased $6,570,000
or 33 percent to $26,749,000 as compared to the net sales of $20,179,000
for the fiscal year ended September 30, 2007. The increase is primarily
attributable to the inclusion of approximately $3,465,000 of revenue
associated with Welch, our newly acquired subsidiary. The remaining
increase in revenue was attributable to a 18 percent increase in overall
tire derived end product revenues during the fiscal year ended September
30, 2008 and a 3 percent increase in scrap tire volume (we processed
approximately 13.2 million passenger tire equivalents during the fiscal
year ended September 30, 2008 as compared to approximately 12.8 million
passenger tire equivalents during the same period last year). The results
for the fiscal year ended September 30, 2007 included approximately
$404,000 of revenue and 205,000 passenger tire equivalents associated with
an Iowa scrap tire cleanup project which was completed during that period.
Gross profit for the fiscal year ended September 30, 2008 was $7,944,000 or
30 percent of net sales, compared to $5,957,000 or 30 percent of net sales
for the fiscal year ended September 30, 2007. The results for the fiscal
year ended September 30, 2008 included Welch, which had a gross profit of
$970,000 or 28 percent of its net sales.
Selling, general and administrative expenses for the fiscal year ended
September 30, 2008 increased $1,759,000 to $5,607,000 or 21 percent of net
sales, compared to $3,848,000 or 19 percent of net sales for the fiscal
year ended September 30, 2007. The increase was attributable to the
inclusion of $1,654,000 associated with Welch, including a significant
investment in sales and marketing efforts to promote the Welch patented
products and establish market presence. These increases were offset by
reduced wages and performance based incentives.
As a result of the foregoing, we had operating income from continuing
operations of $2,337,000 during the fiscal year ended September 30, 2008 as
compared to operating income of $2,109,000 for fiscal year ended September
30, 2007.
Interest and financing expense for the fiscal year ended September 30,
2008, decreased $7,000 to $1,999,000 compared to $2,006,000 during the
fiscal year ended September 30, 2007. The decrease was primarily due to
reduced interest rates.
We recorded a net benefit for income taxes of $5,333,000 primarily due to
the recognition of a deferred tax asset of $5,300,000. As a result of the
gain to be realized in fiscal 2009 from the sale of the tire recycling
operations, we expect to realize the benefit of a portion of our federal
net operating loss carry-forwards and therefore have reduced our deferred
tax valuation reserve resulting in the recognition of the net deferred tax
asset. During the fiscal year ended September 30, 2007 we recorded income
tax expense of approximately $116,000.
As a result of the foregoing, income from continuing operations after
income taxes increased to $5,531,000 for the fiscal year ended September
30, 2008 as compared to a loss of $3,000 for fiscal year ended September
30, 2007.
During the fiscal year ended September 30, 2008, we recognized income from
discontinued operations of $2,361,000 associated with a one time, non-cash
gain resulting from writing off liabilities and the de-consolidation of our
inactive Georgia subsidiary which filed Chapter 7 bankruptcy in June 2008.
During the fiscal year ended September 30, 2007 we reached agreements with
several Georgia vendors regarding remaining past due amounts resulting in
approximately $297,000 of income from discontinued operations.
Our net income for the fiscal year ended September 30, 2008, was $7,892,000
or $.26 per basic share as compared to a net income of $294,000 or $.01 per
basic share for the fiscal year ended September 30, 2007.
"Safe Harbor" Statement: Under the Private Securities Litigation Reform Act
With the exception of the historical information contained in this news
release, the matters described herein contain "forward-looking" statements
that involve risks and uncertainties that may individually or collectively
impact the matters herein described, including but not limited to the facts
that we have sold the tire recycling operations which have historically
generated substantially all our revenue and that we will be prohibited from
competing in that business on a regional basis until 2013, the risk that we
may not be able to increase the revenue of our Welch division, the risks
that we may not be able to identify and acquire complementary businesses
and that we may not be able successfully to integrate any such acquisitions
with our current businesses, the risk that we may not be able to return to
sustained profitability, the risk that we may not be able to secure
additional funding necessary to grow our business, on acceptable terms or
at all, the risk that, if we have to sell securities in order to obtain
financing, the rights of our current stockholders may be adversely
affected, and the risks of possible adverse effects of economic,
governmental, seasonal and/or other factors outside the control of the
Company, which are detailed from time to time in the Company's SEC reports,
including the Annual Report on Form 10-KSB for the fiscal period ended
September 30, 2008. The Company disclaims any intent or obligation to
update these "forward-looking" statements.
Condensed Consolidated Statements of Operations
Three Months Ended Year Ended
September 30, September 30,
2008 2007 2008 2007
------------ ------------ ------------ ------------
Net sales $ 9,039,000 $ 6,507,000 $ 26,749,000 $ 20,179,000
Cost of sales 6,395,000 4,552,000 18,805,000 14,222,000
------------ ------------ ------------ ------------
Gross profit 2,644,000 1,955,000 7,944,000 5,957,000
Selling, general
and administrative 1,611,000 1,027,000 5,607,000 3,848,000
------------ ------------ ------------ ------------
Operating income
from continuing
operations 1,033,000 928,000 2,337,000 2,109,000
------------ ------------ ------------ ------------
Other income
(expense)
Interest and
financing expense (510,000) (396,000) (1,999,000) (2,006,000)
Other (expenses)
income, net (147,000) 3,000 (140,000) 10,000
------------ ------------ ------------ ------------
(657,000) (393,000) (2,139,000) (1,996,000)
Income from
continuing
operations before
income taxes 376,000 535,000 198,000 113,000
Benefit (provision)
for income taxes 5,385,000 (84,000) 5,333,000 (116,000)
------------ ------------ ------------ ------------
Income (loss) from
continuing
operations 5,761,000 451,000 5,531,000 (3,000)
Discontinued
operations
Gain from
discontinued
operations -- 186,000 2,361,000 297,000
------------ ------------ ------------ ------------
Net income $ 5,761,000 $ 637,000 $ 7,892,000 $ 294,000
============ ============ ============ ============
Income (loss) from
continuing
operations per
share - basic $ 0.19 $ 0.02 $ 0.18 $ --
Income from
discontinued
operations per
share - basic -- 0.01 0.08 0.01
------------ ------------ ------------ ------------
Net income per
share - basic $ 0.19 $ 0.03 $ 0.26 $ 0.01
============ ============ ============ ============
Net income per
share - diluted $ 0.16 $ 0.02 $ 0.22 $ 0.01
============ ============ ============ ============
Weighted average
shares outstanding
- basic 30,880,000 22,476,000 30,880,000 21,766,000
============ ============ ============ ============
Weighted average
shares outstanding
- diluted 35,496,000 27,073,000 35,547,000 26,457,000
============ ============ ============ ============
Condensed Consolidated Balance Sheet Data
September September
30,2008 30,2007
------------ ------------
Assets
Current assets $ 13,105,000 $ 3,760,000
Property, plant and equipment (net) 6,951,000 5,219,000
Goodwill 2,290,000 --
Other assets 1,261,000 312,000
------------ ------------
$ 23,607,000 $ 9,291,000
============ ============
Liabilities and Stockholders’ Deficit
Current liabilities $ 19,209,000 $ 7,281,000
Notes payable, non-current 2,023,000 10,807,000
Capital lease obligations, non-current 1,623,000 1,273,000
Deferred gain on sale leaseback 234,000 270,000
Obligations due under lease settlement 580,000 580,000
Stockholders’ deficit (62,000) (10,920,000)
------------ ------------
$ 23,607,000 $ 9,291,000
============ ============
Contact Information: Contacts:
Chuck Coppa
CFO
or
Lyle Jensen
CEO
GreenMan Technologies
781-224-2411
www.greenman.biz