CARLISLE, IA--(Marketwire - May 18, 2009) - GreenMan Technologies, Inc. (
OTCBB:
GMTI),
today announced results for the three and six months ended March 31, 2009.
Lyle Jensen, GreenMan's President and Chief Executive Officer, stated,
"School board budgets have been dramatically tightened across the country
and impacted our results for the March quarter. While sales at our Green
Tech Products (formerly Welch Products, Inc.) subsidiary tend to be uneven
from quarter to quarter given revenues are derived from one time
installations, these results are not acceptable. We are now through our
seasonally slowest second fiscal quarter and heading into our seasonally
and historically stronger second half of the fiscal year. Even with the
reduced school board budgets, we continue to see a very attractive market
opportunity for our products given their ADA compliance and attractive
total cost of ownership."
Mr. Jensen added, "We have devoted a significant amount of time and
resources during the first half of fiscal 2009 evaluating several
potentially near term green-based technologies opportunities particularly
in the areas of recycled material and waste feedstock into bio-fuels,
alternative energy, and recycled products. We remain confident in our due
diligence efforts and our goal is to bring at least one and possibility
several of these opportunities to conclusion by the end of the fiscal year.
Mr. Jensen concluded, "During the quarter we continued to strengthen our
capital structure. In March, we purchased and retired warrants to purchase
4.8 million shares of common stock at an exercise price of $.01 per share
representing all of the remaining warrants held by our former secured
lender, Laurus Master Fund, Ltd. We have successfully evolved our capital
structure over the past year and currently have a strong balance sheet with
over $5 million in cash, limited debt, and $0.40 per share in shareholders'
equity."
Please join us today, May 18, 2009 at 11:00 AM EDT for a conference call in
which we will discuss the results for the quarter ended March 31, 2009. To
participate, please call 1-877-879-6174 and ask for the GreenMan call using
passcode 4546853. A replay of the conference call can be accessed until
11:50 PM on June 13, 2009 by calling 1-888-203-1112 and entering pass code
4546853.
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 website:
www.greenman.biz
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 this press release. 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.
Our business changed substantially in November 2008, when we sold
substantially all of the assets of our tire recycling operations. Because
we operated our tire recycling assets during only a portion of the fiscal
quarter covered by this release and the report on Form 10Q we have included
all relevant information on this business segment but have classified their
respective assets, liabilities and results of operations as discontinued
operations for all periods presented in the accompanying consolidated
financial statements.
The following information should be read in conjunction with the unaudited
consolidated financial statements and the notes thereto included in Item 1
of this Quarterly Report, and the audited consolidated financial statements
and notes thereto and Management's Discussion and Analysis of Financial
Condition and Results of Operations contained in our Form 10-KSB filed for
the fiscal year ended September 30, 2008.
Results of Operations
Three Months ended March 31, 2009 Compared to the Three Months ended March
31, 2008
Net sales from continuing operations for the three months ended March 31,
2009 decreased $510,000 or 84 percent to $98,000 as compared to net sales
of $608,000 for the six months ended March 31, 2008. The decrease is
primarily attributable to decreased playground tile and equipment sales in
the Midwestern and Western regions of the United States. A majority of our
revenue is derived from specific one time installations with minimal follow
on revenue from the installed project, thus making quarterly revenue
comparison particularly difficult. In addition, our quarter ended March 31
is our seasonally slowest quarter due to weather related factors which
preclude the installation of playground tiles and equipment during the
colder winter months, especially in the Midwestern region.
Due to lower revenue and playground tile production during the three months
ended March 31, 2009 we incurred a negative gross profit of $111,000
compared to a positive gross profit of $226,000 or 37 percent of net sales
for the three months ended March 31, 2008. Due to anticipated seasonally
slower tile sales and adequate existing product inventory levels,
management decided to produce a minimal amount of playground tiles during
the quarter ended March 31, 2009. As a result, we were unable to fully
absorb all manufacturing overhead costs resulting in a negative gross
profit during the three months ended March 31, 2009.
Selling, general and administrative expenses for the three months ended
March 31, 2009 decreased $106,000 to $725,000 as compared to $831,000 for
the three months ended March 31, 2008. The decrease was primarily
attributable to reduced travel, marketing and sales related costs.
Interest and financing expense for the three months ended March 31, 2009
decreased $13,000 to $13,000, compared to $26,000 during the three months
ended March 31, 2008 due to decreased borrowings.
As a result of the foregoing, our loss from continuing operations after
income taxes increased $156,000 to $817,000 for the three months ended
March 31, 2009 as compared to $661,000 for the three months ended March 31,
2008.
During the quarter ended March 31, 2009, we recognized a loss from Georgia
discontinued operations of $100,000 associated with settlement agreement
with a former Georgia vendor. The loss from discontinued operations for the
three months ended March 31, 2008 relates to the net results of our tire
recycling.
Our net loss for the three months ended March 31, 2009 was $916,000 or $.03
per basic share as compared to a net loss of $879,000 or $.03 per basic
share for the three months ended March 31, 2008.
Six Months ended March 31, 2009 Compared to the Six Months ended March 31,
2008
Net sales from continuing operations for the six months ended March 31,
2009 decreased $448,000 or 37 percent to $759,000 as compared to net sales
of $1,207,000 for the six months ended March 31, 2008. The decrease is
primarily attributable to decreased playground tile and equipment sales in
the Midwestern and Western parts of the United States of during our
seasonally slower second quarter. A majority of our revenue is derived from
specific one time installations with minimal follow on revenue from the
installed project, thus making quarterly revenue comparison particularly
difficult. In addition, our quarter ended March 31 is our seasonally
slowest quarter due to weather related factors which preclude the
installation of playground tiles and equipment during the colder winter
months, especially in the Midwestern region.
Due to lower revenue and playground tile production during the three months
ended March 31, 2009 our gross profit for the six months ended March 31,
2009 was $57,000 or 8 percent of net sales compared to a gross profit of
$338,000 or 28 percent of net sales for the six months ended March 31,
2008. Due to anticipated seasonally slower tile sales during the quarter
ended March 31, 2009 and adequate existing product inventory levels,
management decided to produce a minimal amount of playground tiles during
the quarter ended March 31, 2009. As a result, we were unable to fully
absorb all manufacturing overhead costs which negatively impacted our gross
profit for the six months ended March 31, 2009.
Selling, general and administrative expenses for the six months ended March
31, 2009 increased $333,000 to $1,902,000 as compared to $1,569,000 for the
six months ended March 31, 2008. The increase was primarily attributable to
an increase of $247,000 in professional expenses relating to business
development initiatives and the November 2008 sale of our tire recycling
operations and an increase of approximately $164,000 in wage and
performance based incentives. These increases were partially offset by
reduced travel, marketing and sales related costs.
Interest and financing expense for the six months ended March 31, 2009
increased slightly to $72,000, compared to $71,000 during the six months
ended March 31, 2008.
As a result of the foregoing, our loss from continuing operations after
income taxes increased $543,000 to $1,894,00 for the six months ended March
31, 2009 as compared to $1,351,000 for the six months ended March 31, 2008.
During the six months ended March 31, 2009 we recognized a gain on sale of
discontinued operations net of income taxes ($5.5 million), of $14,347,000
associated with the sale of our tire recycling business in November 2008.
The income from discontinued operations for the six months ended March 31,
2009 relates primarily to the net results of our tire recycling operations
including approximately $391,000 of one-time gains associated with the
termination of a long-term land and building lease agreement in Minnesota.
In addition, during the six months ended March 31, 2009, we recognized
income from Georgia discontinued operations of approximately $44,000
relating to the net effects of two settlement agreements with two former
Georgia vendors. The income from discontinued operations for the six months
ended March 31, 2008 relates to the net results of our tire recycling
operations.
Our net income for the six months ended March 31, 2009 was $12,771,000 or
$.41 per basic share as compared to a net loss of $861,000 or $.03 per
basic share for the six months ended March 31, 2008.
Condensed Consolidated Statements of Operations
Three Months Ended Six Months Ended
March 31, March 31,
2009 2008 2009 2008
------------ ------------ ------------ ------------
Net sales $ 98,000 $ 608,000 $ 759,000 $ 1,207,000
Cost of sales 209,000 382,000 702,000 869,000
------------ ------------ ------------ ------------
Gross profit (111,000) 226,000 57,000 338,000
Selling, general
and administrative 725,000 831,000 1,902,000 1,569,000
------------ ------------ ------------ ------------
Operating (loss)
income from
continuing
operations (836,000) (605,000) (1,845,000) (1,231,000)
------------ ------------ ------------ ------------
Other income
(expense):
Interest and
financing
expense (13,000) (26,000) (72,000) (71,000)
Other, net 33,000 (30,000) 23,000 (49,000)
------------ ------------ ------------ ------------
Other (expense),
net 20,000 (56,000) (49,000) (120,000)
Loss from
continuing
operations (816,000) (661,000) (1,894,000) (1,351,000)
Provision for
income taxes -- -- -- --
------------ ------------ ------------ ------------
Loss after income
taxes (816,000) (648,000) (1,894,000) (1,351,000)
Discontinued
operations:
Gain on sale of
discontinued
operations -- -- 14,347,000 --
(Loss) income
from discontinued
operations (100,000) (218,000) 318,000 490,000
------------ ------------ ------------ ------------
(100,000) (218,000) 14,665,000 490,000
------------ ------------
Net loss $ (916,000) $ (879,000) $ 12,771,000 $ (861,000)
============ ============ ============ ============
Loss from continuing
operations per
share - basic $ (0.03) $ (0.03) $ (0.06) $ (0.04)
Loss from
discontinued
operations per
share - basic -- -- 0.47 0.01
------------ ------------ ------------ ------------
Net loss per share $ (0.03) $ (0.03) $ 0.41 $ (0.03)
============ ============ ============ ============
Weighted average
shares outstanding 30,880,000 30,880,000 30,880,000 30,880,000
============ ============ ============ ============
Condensed Consolidated Balance Sheet Data
March 31, September 30,
2009 2008
-------------- -------------
Assets
Current assets $ 10,912,000 $ 2,960,000
Assets related to discontinued operations,
current -- 10,145,000
Property, plant and equipment (net) 557,000 551,000
Goodwill 2,290,000 2,290,000
Other assets 976,000 1,094,000
Assets related to discontinued operations,
non-current -- 6,567,000
-------------- -------------
$ 14,735,000 $ 23,607,000
============== =============
Liabilities and Stockholders' Deficit
Current liabilities $ 1,551,000 $ 3,069,000
Liabilities related to discontinued
operations, current 100,000 16,140,000
Notes payable, non-current 477,000 483,000
Obligations due under lease settlement 556,000 581,000
Liabilities related to discontinued
operations, non-current -- 3,396,000
Stockholders’ equity (deficit) 12,052,000 (62,000)
-------------- -------------
$ 14,735,000 $ 23,607,000
============== =============
"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.
Contact Information: Contacts:
Chuck Coppa
CFO
Lyle Jensen
CEO
GreenMan Technologies
781-224-2411