Gencor Industries(GENC) - 2022 Q2 - Quarterly Report

Financial Performance - For the quarter ended March 31, 2022, net revenue was $30,654,000, representing an increase of 43.4% compared to $21,352,000 for the same quarter in 2021[18] - Gross profit for the quarter was $6,192,000, slightly up from $6,146,000 in the prior year, indicating a stable gross margin[18] - Operating income increased to $1,908,000 for the quarter, compared to $1,239,000 in the same quarter last year, reflecting improved operational efficiency[18] - Net income for the quarter was $439,000, a decrease from $2,288,000 in the prior year, primarily due to net realized and unrealized losses on marketable securities[18] - Basic earnings per share for the quarter ended March 31, 2022, were $0.03, a decrease from $0.16 in the same quarter of 2021[44] - Net income for the quarter ended March 31, 2022, was $439,000, or $0.03 basic and diluted earnings per share, down from $2,288,000, or $0.16 basic and diluted earnings per share, for the same quarter in 2021[88] Revenue and Sales - Equipment sales recognized over time amounted to $10,998,000 for the quarter ended March 31, 2022, compared to $3,870,000 in the same quarter of 2021, indicating a significant increase of 184.5%[52] - Net revenues for the quarter ended March 31, 2022, were $30,654,000, an increase of $9,302,000 compared to $21,352,000 for the same quarter in 2021, reflecting the impact of the $1.2 trillion infrastructure bill signed into law in November 2021[82] - Net sales increased by $10,444,000 to $50,760,000 for the six months ended March 31, 2022, compared to $40,316,000 for the same period in 2021, driven by the new $1.2 trillion infrastructure bill[89] Assets and Liabilities - Total current assets increased to $173,603,000 as of March 31, 2022, up from $166,823,000 at September 30, 2021, driven by higher inventories and accounts receivable[15] - Total liabilities rose to $19,065,000 as of March 31, 2022, compared to $12,173,000 at September 30, 2021, largely due to increased customer deposits[15] - Cash and cash equivalents decreased to $22,571,000 at the end of the quarter, down from $23,232,000 at the end of the previous fiscal year[15] - The company’s net inventories as of March 31, 2022, totaled $47,222,000, an increase from $41,888,000 as of September 30, 2021[42] - Customer deposits related to contracts with customers increased to $10,286,000 at March 31, 2022, from $5,244,000 at September 30, 2021[59] Expenses - Selling, general and administrative expenses decreased to $3,364,000 for the quarter ended March 31, 2022, compared to $3,838,000 for the same quarter in 2021, attributed to lower professional fees[84] - Product engineering and development expenses decreased to $920,000 for the quarter ended March 31, 2022, from $1,069,000 in the same quarter of 2021, primarily due to reduced headcount[84] - Product engineering and development expenses rose by $355,000 for the six months ended March 31, 2022, compared to the same period in 2021[91] Marketable Securities - The company reported net unrealized losses of $(1,598,000) for the quarter ended March 31, 2022, compared to net unrealized gains of $596,000 for the same quarter in 2021[37][38] - As of March 31, 2022, total marketable securities measured at fair value were $94,501,000, with $70,479,000 classified as Level 1 and $24,022,000 as Level 2[37] Operational Metrics - The effective income tax rate for the quarter ended March 31, 2022, was 24.2%, compared to 20.0% for the same quarter in 2021[88] - Cash provided by operations during the six months ended March 31, 2022, was $1,045,000[98] - Cash flows used in investing activities for the six months ended March 31, 2022, were $1,706,000, primarily for capital expenditures[99] - The Company had $22,571,000 in cash and cash equivalents and $94,501,000 in marketable securities as of March 31, 2022[97] Backlog and Contracts - The Company's backlog increased to $44.9 million at March 31, 2022, compared to $42.6 million at March 31, 2021[98] - Costs incurred on uncompleted contracts were $19,501,000 as of March 31, 2022, compared to $11,483,000 as of September 30, 2021, reflecting an increase of 70.4%[43] - The estimated earnings on uncompleted contracts were $5,875,000 as of March 31, 2022, compared to $4,395,000 as of September 30, 2021, indicating a growth of 33.6%[43] Strategic Developments - The acquisition of Blaw-Knox assets in October 2020 has allowed the company to enter the asphalt paver sector, contributing to its market expansion strategy[26] - One customer accounted for 13.6% of net revenues during the quarter ended March 31, 2022, compared to 12.0% for another customer in the same quarter of 2021[47]