Armstrong, Iowa — Art's Way Manufacturing, a diversified, international manufacturer and distributor of equipment serving agricultural, research and steel cutting needs, announces its financial results for the first quarter of fiscal 2020.
Consolidated corporate sales for the three-month period ended Feb. 29, 2020 were $5,026,000 compared to $4,124,000 during the same period in fiscal 2019, an increase of $902,000, or 21.9%. The increase in consolidated sales is due to increased sales across all three segments.
First quarter sales in the Agricultural Products segment were $2,953,000 compared to $2,610,000 for the same period in fiscal 2019, an increase of $343,000, or 13.1%. The increase in revenue is due to increased demand across manure spreader, dump box and grinder product lines. The successful release of new products at the beginning of 2019 has proved to complement the grinder business well. The company also acquired market share of dump boxes at the end of fiscal 2019 and have continued to sell dump boxes into the first quarter of fiscal 2020. The company said it is working to replace lost revenue from a decrease in sales to its OEM blower customer and major OEM reel customers in fiscal 2019.
First quarter sales in the Modular Buildings segment were $1,457,000 compared to $1,022,000 for the same period in fiscal 2019, an increase of $435,000, or 42.6%. The increase in revenue is due largely to the progress on a large construction contract that will continue into the third quarter of fiscal 2020. However, even without this large construction contract the backlog at Feb. 29, 2020 would still be up by more than $1 million from the same period in fiscal 2019.
The Tools segment had sales of $616,000 during the first quarter compared to $492,000 for the same period in fiscal 2019, a 25.2% increase. The increase is due to increased sales from an OEM agreement that was signed in fiscal 2019. The company believes the full potential of this agreement has not been achieved at this point.
Consolidated net loss was $(437,000) for the three-month period ended Feb. 29, 2020 compared to net loss of $(606,000) for the same period in fiscal 2019. The decreased net loss is due to increased sales across all three segments, as well as conscious efforts to cut costs and improve workforce efficiency.
Chairman of the Art's Way Board of Directors, Marc H. McConnell reports, "We are pleased to report top-line growth in all three of our businesses in the first quarter. We entered this year with strong backlogs and felt momentum building in our business that led to better results, albeit not yet at a profitable level. Subsequent to quarter-end we also were pleased to announce that David King would be joining the team to succeed our Chief Executive Officer Carrie Gunnerson upon her impending retirement later in the year. David brings a great skill set that we believe will help our company grow in the years ahead and build upon the foundation established under Carrie's leadership these many years."
"Our outlook for the year has until recently been positive, but at this time we have lowered our expectations as the impact of COVID-19 has brought new challenges to our business and leaves us uncertain as to what to expect from a demand perspective for the balance of the year. As such we are taking conservative actions to manage expenses and liquidity to manage our way through the crisis while also making decisions that support the health and safety of our Art's Way family."