P&F Industries, Inc. Reports Results For The Three And Nine-month Periods Ended September 30, 2017

MELVILLE, N.Y., Nov. 9, 2017

There were no discontinued operations in 2017, whereas during the third quarter of 2016, the Company reported net income from discontinued operations after taxes of $187,000, and reported for the nine-month period ended September 30, 2016, income, net of tax, of $12,430,000, from the February 2016 sale of Nationwide Industries, Inc. and its operations prior thereto.

Richard Horowitz, the Company's Chairman of the Board, Chief Executive Officer and President commented, "The acquisition in April of this year of the Jiffy Air Tool business continues to prove to be a strategic acquisition, enabling us to penetrate deeper into the aerospace sector, with revenue this quarter of $2,564,000.  Further, as previously disclosed earlier this year, we made the decision to exit the Sears relationship effective September 30, 2017.  For more than three decades, we have been the primary provider to Sears of its Craftsman pneumatic tools, making this decision extremely difficult.  However, Sears' continued financial difficulties, and their decision to sell the Craftsman brand to Stanley Black & Decker, made us reassess our return in relation to our risk.  I wish to note that Sears purchased nearly all remaining Craftsman inventory from us, with the small balance of the Craftsman inventory remaining on hand projected to be sold to Stanley Black & Decker. At this juncture, we remain confident that we will collect the balance owed by Sears by year end.

Our Automotive revenue declined this quarter compared to the third quarter of 2016.  We believe this decline was due to two major customers who, we have been advised, are currently in the process of re-balancing their pneumatic hand tool inventory. However, while our Automotive revenue may have declined this year compared to the same periods in 2016, our Automotive revenue, on a trailing twelve month basis, has increased 19% compared to the first twelve months immediately following the acquisition of Exhaust Technologies, Inc. and its AIRCAT line of automotive tools.   

I am also pleased to report that our Industrial/catalog revenue has improved nearly 20% this quarter compared to the third quarter of 2016, with year to date revenue higher by 8% over the same nine month period a year ago."

Mr. Horowitz added, "Hy-Tech's revenue increased 19% this quarter over the third quarter of 2016, which is an encouraging sign.  Further, its gross margins continue to improve, evidenced by a 19 percentage point increase this quarter, compared to the same period a year ago.  Finally, Hy-Tech's initiative to expand its product and technology into new niche markets continues to grow, accounting for 7.0% of Hy-Tech's ATP nine-month revenue. We remain confident that growth in this sector will continue. And Lastly, in September, we acquired intellectual property from Numatx, Inc. This acquisition will add another product line to our aerospace offering, allows us to manufacture and market one of the world's smallest, lightest, aerospace-grade C-Squeezer and alligator squeezer riveters, and we are excited by its prospects.

Our selling and general and administrative expenses during the three-month period ended September 30, 2017, increased $437,000, compared to the third quarter of 2016. It should be noted that this quarter's selling, general and administrative expenses include approximately $575,000 attributable to Jiffy's operations."