Greystone Logistics, Inc.: New Products and Growth Potential
2024-01-20
Greystone Logistics, Inc. held its Q2 2024 Earnings Call on January 17, 2024, at 2:00 PM ET. The call was attended by Brendan Hopkins (Investor Relations), Warren Kruger (Chief Executive Officer), and Curtis Crosier (Chief Financial Officer). During the call, the participants discussed various topics related to the company's performance and future prospects.
One of the main concerns highlighted by CEO Warren Kruger was the need to increase sales volume and improve margins. The company has been actively working on developing new products to meet the demands of its customers. Notably, Greystone Logistics, Inc. has been manufacturing a new pallet for Walmart, which incorporates ergonomic changes, reduced weight, and the ability to hold cellular devices. The revenue from this new pallet is expected to be realized within the next 75 to 90 days.
In addition to Walmart, the company has been focusing on the Patel Industry. Greystone Logistics, Inc. is currently developing a mirror palette for the peanut industry and a modified automobile palette. However, they have encountered some challenges with the automobile palette, as it does not stack correctly with existing 48x45s in the General Motor and Forge system.
Financially, the company's balance sheet remains strong and capable of supporting current sales volume and future growth. The company's working capital stands at $7 million, and the interest and debt payments in the last quarter were just under a million dollars. Although sales volume slightly decreased in Q2 compared to Q1, margins improved by approximately 3% due to cost reductions. The company's current inventory level is $5 million.
Greystone Logistics, Inc. has also invested in equipment to expand its capabilities. They recently acquired an extrusion line to produce plastic hollow lumber, which can be manufactured in any size without the need for expensive molds. This extruded lumber has attracted interest from companies such as Toyota and Berry Plastics.
During the Q2 Results Call, the company addressed questions regarding fire retardancy tests, Walmart's concerns about their product, and the company's future plans. The company acknowledged that they failed multiple fire retardancy tests due to the high cost of making their product fire retardant. However, they plan to test a fire additive from an Israeli company to address this issue. Walmart raised concerns about the ergonomics of part picking, the need for more hand holes, and the elimination of certain cross members on the bottom of the pallet. Greystone Logistics, Inc. assured Walmart that the product will be ready to go when it arrives at their facility. They also mentioned that the Walmart contract has the potential to generate more revenue than the previous contract.
Looking ahead, Greystone Logistics, Inc. aims to surpass last year's numbers and focus on improving margins. The company recognizes the importance of increasing sales and introducing new products to achieve their goals. They appreciate the support of their shareholders and remain cautious about the costs associated with uplifting. The call concluded with a thank you from the speakers and the operator announcing the end of the call.
Overall, the Q2 2024 Earnings Call for Greystone Logistics, Inc. covered various important business topics, including sales, customer relationships, financial performance, product development, and future prospects. The company remains optimistic about its growth potential and is committed to delivering value to its shareholders.