Still don't own this right now. I would like to hear these guys do a conference call just to get an idea how they handle themselves.
Revenues seem to be leveling out to up slightly, and earnings are better, except for special events and goodwill impairments. They might be able to earn $3.20 per share in 2014 if they can avoid special charges. If you take their best Q1, 2, 3, and 4 from the last 3 years, they are all over .80. Can they get 4 quarters in a row at those levels? Who knows. My spreadsheet is a mess with all the special charges over the years.
They are hedging copper prices, but those have been going down and could cost them money if that continues. Still, customers don't really expect product prices to drop much when copper goes down, so maybe not a big impact. If they were selling copper wire, that would be another story.
In an attempt to limit the volatility of copper costs, the Company has in the past, and may in the future, enter into purchase agreements for copper. As of December 31, 2013, inventory purchase commitments for copper totaled $2,300,000. As of December 31, 2013, no purchase commitments for copper were greater than nine months.
Also see that employment is flat from last year, but at 1,400 now it is down 200 since 12/31/2010. Not much growth there.
As far as goodwill, I saw this from the 10-K:
The goodwill impairment was primarily due to a decline in medical imaging equipment market sales during the year coupled with the cancellation of a large solar contract during the fourth quarter of 2013. This resulted in the TEAL reporting unit having lower sales and cash flows for the year than previously projected and lower forecasts of future sales and cash flows for the reporting unit.
Goodwill totaled $17,666,000 and $22,735,000 as of December 31, 2013 and December 31, 2012 (representing 16% and 21% of total assets), respectively.
Yahoo probably won't allow me to post the link, buy if you search for the title, you can probably find the article. Says farmers have been cheating for years on refuge acres, and now we pay the price because the little critters are not affected as my with the BT corn. Greater refuge acres would be good for AVD. Found the article on Wired Science.
Voracious Worm Evolves to Eat Biotech Corn Engineered to Kill It
I was hoping it would be you. It makes me nervous when the share price goes up before earnings. I have $5 million in revenues and $0.03 in earnings plugged into my spreadsheet, but it's just a guess.
I am more interested in guidance that calls for $10 million in revenues per quarter and a return to margins equivalent to those in 2008. That would give us earnings at about $0.25 per Q and be a good sign for the future. Would also like to hear what their hopes are longer term. Do they see $25 million per Q in a few years? Of course, we could all be disappointed too, but I hope not.
I just noticed that Senator sold all their ATNY shares to SP Holdings (AKA stock symbol SXCL). SXCL has a fair amount of cash that they need to deploy also, so could be interesting in buying more. FWIW, I have opened a small position in ATNY just to see if anything develops. Sometimes Warren L makes a good purchase and sometimes not.
Oops, fine print shows that it's still only a little over $2,000 for the year. I still just don't get it. Now they claim to have over a million users. Even if they get to a billion users, that would only be $2 million in revenues and they lost $15 million last year.
On March 11, 2014, Judge Ann Montgomery of the District of Minnesota dismissed a putative antitrust class action against Graco Inc. and its distributors that accused Graco of buying two of its closest competitors in the spray foam equipment market for the purposes of raising prices and reducing product options. Insulate SB Inc. v. Abrasive Products & Equipment et al., case number 0:13-cv-02664. The plaintiff alleged that after Graco purchased its rivals, it conspired with its distributors to boycott competitors. The lawsuit followed Graco’s FTC settlement which bars it from pressuring distributors into not carrying its competitors’ equipment products. The court held that the plaintiff’s allegations, which occurred four years prior to filing the suit, were barred by the statute of limitations, and that even if the claims were not time-barred, the plaintiff’s allegations were speculative and conclusory. The court also dismissed the plaintiff’s request for injunctive relief, finding the remedy drastic for the situation and stating that “Graco’s acquisition occurred over five years ago, and divestiture would impose obvious hardship on Graco employees and distributors.”
I have opened a small position I this just to see if anything develops. Sometimes Warren L makes a good purchase and sometimes not.
I just noticed that Senator sold all their shares to SP Holdings (AKA stock symbol SXCL). SXCL has a fair amount of cash that they need to deploy also, so could be interesting in buying more.
From today's SEC filing, Imerys gives up. MTX wins the bid at $45.75. Unless you need to wait for holdings that might go long term for tax purposes, there is probably no reason not to sell at just a couple cents below the offering price.
Imerys confirms today the termination by AMCOL International Corporation (NYSE: ACO, AMCOL) of the Agreement and Plan of Merger between Imerys and AMCOL, dated February 11, 2014, as amended. The termination follows Imerys’ decision, on March 7, not to increase its offer price for the acquisition of AMCOL after concluding that a higher price would not comply with its long term value creation objectives.
Pursuant to the terms of the Merger Agreement, AMCOL has paid a US$39 million termination fee to Imerys’ US subsidiary, which commenced the tender offer.
All steps necessary to withdraw Imerys’ tender offer for shares of AMCOL common stock are now being taken. As a result, all the shares of AMCOL’s common stock previously tendered will be returned to the holders thereof and no consideration will be paid to such holders.
Good point on the trade shows. Heck, maybe someone ordered some test equipment. There is another show in China in a week or two also. As you say, we really need a couple of large orders to prove it's the real deal. Still, makes you feel a little better when it goes up 13% in one day.
March 9-12, 2014
Hilton Phoenix East/Mesa Hotel
March 18-20, 2014
International Expo Center
In a pairing that is seen strengthening the U.S. in the specialty chemicals market when industry is resurgent, New York-based Minerals Technologies (MTX) is buying peer Amcol International (ACO) for about $1.7 billion.
After raising an earlier-rejected bid, Minerals Technologies won a bidding war for Amcol, based near Chicago, with a $45.75-per-share cash offer, besting rival bidder Imerys' $45.25 offer made March 4.
Last Thursday, Amcol said Minerals Technologies' offer was acceptable and Imerys, a French specialty chemicals multinational, had four days to come up with a better offer. Imerys failed to do so and Amcol paid a $39 million termination fee to Imerys.
The deal pairs specialty chemicals maker Minerals Technologies, spun off from Pfizer in the early 1990s and with annual sales topping $1 billion, with specialty chemicals company Amcol, which has nearly identical sales.
Looks like a done deal now at $45.75 per share. Irks me that I left $4.00 per share on the table by selling early, but oh well. My average cost was probably $28 per share and I sold at $41.50 so I guess I can't complain that much. Still think we would have been better off if Larry Washow had stayed in command. May look at MTX as an investment after this settle down. If they had done this properly, it would have been a tax free swap for MTX shares and everyone would have been better off. Harder to do with a French company, but not with MTX.
March 10 (Reuters) - Minerals Technologies Inc said it would buy Amcol International Corp for about $1.7 billion, after Paris-based Imerys SA failed to match Minerals' sweetened bid of $45.75 per share.
Amcol had previously asked Imerys to match Minerals' offer of $45.75 per share.
Amcol shares fell 2 percent to $45.69 in early trading on Monday.
The company has large reserves of bentonite, a mineral used in the construction and energy industries.
Per the investor presentation from November, 2013, cotton was 13% of sales. Last year these sales were adversely impacted by reduced cotton acres and other weather related issues. Barron's thinks cotton acres will increase. This should be quite good for AVD. They expect prices to fall later due to increased production.
Looks like the bidders are getting tired and I expect one of them to throw in the towel soon. There has to be a level where the auctioneer puts the hammer down. $46 or so seems like close to fair value. Wish I hadn't jumped the gun on my sale, but that's life. Still made some money, but hated to leave that much on the table.
Not that I am interested in AEHR being acquired, because I am not, but they need to get the share price up if they want to avoid being purchased. I would much prefer AEHR to climb on its own for the next several years instead of a one time 50% premium.
Theodore O’Neill - Litchfield Hills Research
Hi just a follow-up question on the acquisition front. You are on track to almost doubling your cash balance from 2011 to 2014. And so I am wondering is there a sense of urgency in trying to deploy that?
I would say there is a sense of urgency Theodore. I mean cash at December 31 represents 50% of our total assets. So clearly we wish to deploy that cash and as we have publicly discussed in the past on this call as well as in Investor Meetings or conferences that we have attended that have been webcast that we – that’s our primary goal, our Board feels that’s a better use of cash than other capital market allocation strategies such as dividends or stock buybacks. That said, we have recognized that if an acquisition is not completed in a timely basis the Board will look at other capital allocation strategies in the interim. But the goal was to be able to use these funds to grow the top line through the acquisition of additional technologies.
This comment on how they plan to grow the company, possibly through acquisitions, is also interesting:
Our goal was to try and double our size actually more than double, it get to 100 million in three years Srini. And our goal to do that is through not only organic growth of our existing businesses primarily further expansion into the verticals that we’re expanding into outside of semi. But through at least one if not two strategic acquisitions of businesses that would be oriented towards thermal technology and again with an orientation towards markets outside of semi test to further diversify our revenue stream that with a goal there also of trying to get ourselves to about 50% of our revenues outside of the semi space on a consistent basis. So we’ve reduced some of the cyclical aspect of riding on this roller coaster in the semi business.
As far as what particular technologies we’re looking at in thermal area as well as non-thermal technologies I mean we’re – our M&A search is very focused, but we’re looking in some different technologies as well. And we’re looking at public companies as well as private companies. So I think we’re – one thing I can tell you is we’re very focused at this point and active. We’re – we’ve been working with a boutique M&A firm and have recently since January 1 stepped up our activity with this company in evaluating opportunities and seeking them out. And we’re optimistic that we would hope to have some transaction at some point to move forward in 2014. But at this point there is nothing definitive in our pipeline that we can talk about further.
Thought this comment from the INTT call was interesting:
Les Sulewski - Sidoti & Company
Okay. And on looking at semi, are talks still positive on the recovery?
Well if you look at the earnings releases of others in the ATE space, you see various results in other words I think the market is beginning to open up for all of us just at a different pace for certain of us versus others depending on the customers that you serve and the end-user products that those customers bring to market. Semi is calling; our trade organization is calling for a 20% to 25% increase in the ATE space that this year I think that might be a little optimistic. But I think we would hope to see at least half that level this year and increase if not a little bit more. But – and as we mentioned we quote activity is very strong right now. We did see very strong booking activity earlier in the quarter and we still got a third of the quarter basically left at this point. So I would not be surprised if we were to see that pick up again.
Not a bad report. Revenues were better than I expected and earnings were in line. Could have been worse. They also have $7 per share in cash on the balance sheet. I am hoping to go the annual meeting next week and see if they give any guidance. They don't give much in the PR's.
Glad to see the usual PR's after the close of the quarter. I am really interested to hear the update on the new equipment at the CC in a couple weeks.
Part of today's PR:
FREMONT, Calif., March 6, 2014 (GLOBE NEWSWIRE) -- Aehr Test Systems (AEHR), a leading supplier of semiconductor test and burn-in equipment, today announced it has received over $1.5 million in follow-on orders for WaferPak full-wafer contactors for its FOX-1 and FOX-15 wafer-level burn-in and test systems.
"We are pleased with the continued activity we are seeing in our WaferPak consumable business," said Carl Buck, vice president of marketing at Aehr Test Systems. "We see our customers doing full-wafer test or burn-in on more and more of their new products. The orders for these WaferPak contactors are for diverse applications, including both automotive and flash memory applications."
"These orders are another indication of the effectiveness of our FOX wafer-level burn-in and test products. These products are differentiated by our proprietary full-wafer burn-in and test technology and WaferPak contactors, which support processing up to 15 wafers in parallel in a single system," said Gayn Erickson, President and Chief Executive Officer of Aehr Test Systems.