P&F Industries, Inc. (NASDAQ:PFIN) Q4 2021 Earnings Conference Call March 29, 2022 11:00 AM ET
Company Participants
Richard Goodman – General Counsel
Richard Horowitz – Chairman, President, and Chief Executive Officer
Joseph Molino – Chief Operating Officer and Chief Financial Officer
Conference Call Participants
Andrew Shapiro – Lawndale Capital Management
Timothy Stabosz – Private Investor
Operator
Good day, and welcome to the P&F Industries, Inc. 2021 Earnings Call. Today’s conference is being recorded.
At this time, I’d like to turn the conference over to Mr. Richard Goodman, the company’s General Counsel. Please go ahead, sir.
Richard Goodman
Thank you, Operator. Good morning, and welcome to P&F Industries’ Full-Year 2021 Conference Call. With us today from management are Richard Horowitz, Chairman, President, and Chief Executive Officer; and Joseph Molino, Chief Operating Officer and Chief Financial Officer.
Before we get started, I’d like to remind you that any forward-looking statements discussed on today’s call by our management, including those related to the company’s future performance and outlook are based upon the company’s historical performance and current plans, estimates and expectations, which are subject to various risks and uncertainties, including, but not limited to, risks related to the global outbreak of COVID-19 and other public health crises, risks associated with sourcing from overseas, disruption in the global capital and credit markets, importation delays, customer concentration, unforeseen inventory adjustments or changes in purchasing patterns, market acceptance of products, competition, price reductions, exposure to fluctuations in energy prices, the strength of the retail economy in the U.S. and abroad, risks associated with Brexit, adverse changes in currency exchange rates, interest rates, debt and debt service requirements, borrowing and compliance with covenants under our credit facility, impairment of long-lived assets and goodwill, retention of key personnel, acquisition of businesses, regulatory environment, litigation and insurance, the threat of terrorism and related political instability and economic uncertainty, and business disruptions or other costs associated with information technology, cyber attacks, system implementations, data privacy or catastrophic losses, and those other risks and uncertainties described in the reports and statements filed by the company with the SEC, including, among others, as described in our most recent annual report on Form 10-K, our quarterly reports on Form 10-Q and our other filings.
These risks could cause the company’s actual results for future periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the company. Forward-looking statements speak only as of the date on which they are made, and the company undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.
And with that, I would now like to turn the call over to Richard Horowitz. Good morning, Richard.
Richard Horowitz
Good morning, Rich, and thank you all so much for being on the call with us today and joining us for P&F’s results for the full-year of 2021. I hope all of you are doing well as the country and the world are trying to exit the ill effects of the global pandemic. Our thoughts and prayers go out to those who have lost loved ones due to this deadly disease. Further, our thoughts and prayers go out to the victims of the current crisis occurring in Ukraine; may it soon come to a peaceful solution.
During 2021, P&F continued to encounter the ill effects of the COVID-19 global pandemic. The areas in 2021 most affected were the inability or extreme limitation of our sales force which was — when they encountered in their efforts to gain onsite product presentations, which in particular hampered the growth of our PTG or our gears business. The supply chain disruptions which caused major delays in receipts of much needed inventories, as we all see every day in the newspapers. And lastly, the excessive costs incurred in connection with the supply chain delays.
I would like to direct your attention to the company’s press release that was released earlier today, which includes the company’s December 31, 2021 balance sheet, statement of operations, statements of cash flows, and discussion related to the company’s results for full-year 2021, and they compare to the full-year 2020. In order to make better use of everyone’s time today, yet be mindful of the purpose of this conference call, I would like to remind all of you of the following procedures that have been in place for quite some time now. First, as we have done for several previous conference calls and has become our standard practice, we will move directly to a question-and-answer session, and not restate what is already in this morning’s release.
Secondly, and please be aware that we will only be answering questions directly related to the company’s results of operations and financial condition. We must insist that you adhere to this procedure. Management will not be entertaining any questions that go beyond the scope of this call.
And then with that, we will be happy to answer any pertinent questions anybody may have. Operator, you can open up the question line.
Question-and-Answer Session
Operator
Thank you. [Operator Instructions] And we’ll go to our first question from Andrew Shapiro with Lawndale Capital Management.
Andrew Shapiro
Hi. Can you hear me okay?
Richard Horowitz
Yes, we hear you fine.
Andrew Shapiro
Awesome. So, I have to — it’s unfortunate, but every fourth quarter I kind of have to ask this. Your Board of Directors, I’m sure you guys prepare for them, the results for the fourth quarter ended December, in addition to the annual, your press release, repeatedly, each fourth quarter doesn’t include that breakout. And I don’t understand why you can’t provide that to shareholders as well in your press release. And I’d respectfully ask you guys to do that going forward. But, of course, we’ll wait three more quarters to get the same thing. Is there a reason you can’t or you don’t provide the fourth quarter numbers?
Joseph Molino
Andrew, it’s not required. It’s certainly a lot of extra work. And by the way, we don’t prepare something like that for the Board of Directors, to my knowledge.
Andrew Shapiro
Your Board does not want to look at how the quarter’s performance is when they have their quarterly meeting?
Joseph Molino
We look at the whole year, and they can do math if they’d like.
Andrew Shapiro
So, you make them do the same reverse engineering that we have to do as shareholders, is that correct?
Joseph Molino
They’re more concerned about the full-year results.
Andrew Shapiro
Okay. Moving on to the questions, from what I could see, so a few questions regarding kind of the COVID-19 impacts, to know where things stand this last quarter, as well as where we stand now here in — at the end of March, another full three months after. So, what part of the quarter, if any, were you able, finally, to conduct onsite visits with current or prospective customers for Hy-Tech PTG as well as your existing North American aerospace, like Boeing and its suppliers, as well as prospective overseas aerospace customers, like Airbus? I know you sited in your — that there is still difficulties, but to any extent, in the fourth quarter, were you able to conduct any onsite visits in either of those two, I guess, industry groups and customer groups?
Richard Horowitz
It was very, very sporadic. Very sporadic, and it depended on the area that the company was in, the geographic location of it, and what their COVID caseload was like at that time. Boeing, specifically, really did not, and still really does not take customers — vendors too much. Sporadically we can. And Airbus has not opened up yet, but they momentarily claim they’re going to be.
Andrew Shapiro
Okay. And on PTG, were you able to get into some or not?
Richard Horowitz
Yes, we’ve got into some customers, and other customers we couldn’t get into. It was very sporadic, and nothing —
Andrew Shapiro
Okay.
Richard Horowitz
Yes.
Andrew Shapiro
And then from the end of the year, fourth quarter and basically till this week, basically much of the first quarter, have things improved further?
Richard Horowitz
They’re improved, I would say, slightly, but not — if you’re referring to Boeing and Airbus, the answer is no, really. But the others, we’re seeing customers. And now, with the new Omicron variant that seems to be gaining a lot of steam in Europe and other places, is becoming — it’s on everybody’s mind again, I hate — sorry to say.
Andrew Shapiro
Right, okay. Because it’s been pretty highly publicized how — well, Boeing is nowhere near that production rate they were at before the 737 grounding, yet the production rates have greatly scaled up and are scaling up. And that there has been publicity about how Boeing needs its suppliers and others to step up and there’s concerns whether they can. So, with that kind of sentiment, are you seeing greenshoots with respect to them wanting to get its vendors — and you’re pretty much like a supplier to vendors, so you’re supplying tools, you’re not really supplying the airframes themselves. But are they giving indications of opening up or wanting you to start focusing on being ready to supply them?
Richard Horowitz
First of all, our people who are on the ground there and as much — or in the factory, are saying that the numbers that are being released publicly, we just heard this last week, are not even close to what they actually are at Boeing, not even close is what they’re telling us.
Andrew Shapiro
Okay.
Richard Horowitz
And I don’t know where those numbers come from, I can’t tell you that. I read the same numbers you do, and we all kind of thought it was going to get better. But that’s — it’s not to those levels yet, am I right, Joe, that’s what we’re told.
Joseph Molino
Yes, it’s unclear. Nobody — you can’t really get a straight answer about what the actual production level is per month, but we do feel it’s below what’s been publicly stated.
Andrew Shapiro
Okay. And where do operations, with respect to any supply chain disruptions, currently stand? Are you seeing any improvement in the situation?
Joseph Molino
Not at all.
Andrew Shapiro
No?
Joseph Molino
Not even a little bit. And again the issue isn’t so much production at the plants overseas, it’s getting it from the plant by truck to the port, getting it on a port, a boat, get — finding a boat, the boat leaving on time, and then the boat not being delayed at the three or four other stops along the way between Shanghai and Miami. So, no, it’s not better.
Andrew Shapiro
Right.
Richard Horowitz
It’s — I mean we’re dealing with it as best we can, like every other company. And let’s not even — let’s not forget talking about inflation, with the pricing and all that stuff that goes with it, from the shipping to the product itself, it’s an enormous challenge every day between the — getting the product and — getting the product and paying — getting the right price for it, which is impossible actually.
Andrew Shapiro
Right. And a related question here in the — the inventory you built up to increase your safety stocks. Am I correct that this is mostly finished goods at Florida Pneumatic against regularly stocked items?
Richard Horowitz
That is correct.
Andrew Shapiro
And do you feel the company is now at desirable levels, and have the [other] [Ph] stock problems been addressed?
Richard Horowitz
Again, there were several items that were out of stock, and there were others that we have an abundance of product.
Joe, anything you want to add to that?
Joseph Molino
I would say we’re at least a month or two away to the point where I feel like we’re really stocked.
Andrew Shapiro
Okay. And regarding the large late 2021 order you also built the inventory for. Am I correct to assume it’s in Florida Pneumatic as well?
Joseph Molino
Yes, it’s all — it’s the bulk of the buildup is Florida Pneumatic, but [indiscernible].
Andrew Shapiro
Yes. And can you clarify the timing of when you book revenues and the receivable for that order? And it’s the end of March, has this late-2021 order shipped out or what is its status now?
Joseph Molino
It — it has not shipped yet.
Andrew Shapiro
Okay. And when you book revenues in the receivable, it’s not booked until you ship, is that correct?
Joseph Molino
Correct.
Andrew Shapiro
Okay, great. I’ll back out, but I have more questions. I’m [indiscernible] seeing if there’s others here.
Richard Horowitz
All right, thanks.
Operator
We’ll go to our next question from Timothy Stabosz.
Timothy Stabosz
Good morning, gentlemen. I own 4% of the company, and back in on a conference call here. Happy New Year to everyone. I wanted to start by asking an earnings-related question that’s kind of a 50,000-foot-level question. And that is, you guys have done a lot over the last several years to remake the company. You’ve sold divisions, you’ve acquired things. You’ve got a vision and a strategy, it seems to me, with regard to the — who you want to service and what you want to do. And yet you’ve been hit by unfortunate headwinds on oil, with the insane volatility over the number of years here of yo-yoing cycles, and, of course, [Airmax] [Ph].
Well, my question for you is do — how do you feel about — it’s not shown in the numbers obviously, but how do you feel about what you’ve been doing to — when you look at P&F now versus a decade ago when we were baseboard heating [indiscernible] what we were doing a long time ago, how do you feel about what you’ve been doing? To try to give you credit for — want to hear in your own words, obviously, like where the company is going, and these strategies, and that they will pay off and that you believe in them, and where we’re going from here, because you haven’t been really credited, obviously, in the numbers, but I kind of want to hear you say to the shareholder base that sees, presumably, the value I see in the stock, where we’re going and what you think? So it’s — can you speak to that?
Joseph Molino
Tim, I’ll — this is Joe. I’ll try. I would agree that we’ve had to pivot a little bit. We’ve been in the tool business for a long time. And for a very long time, at least on the Florida Pneumatic side, there were various distribution channels that were the way that you got the product to market. And what we started to see, especially with respect to the automotive, was that the younger mechanics, techs were more and more comfortable with their iPads and their iPhones, and instead of entertaining a [van] [Ph] from one of the big distributors, like Snap-On, they were getting more and more comfortable with the Internet and ordering product directly. And we’ve had a big shift in that business, we’ve had growth overall. But more importantly, shift away from the traditional channels and to more online both through Amazon and several large distributors who are also very large online. So, we saw that and I think we’re out in front of that, frankly, and I don’t quote me on this, but I think in 2020, we had the most popular tool, the most popular half engine pack sold on Amazon. And we’re up against some pretty big players. So, I feel very good about that move. And where we didn’t have the expertise in that marketing, we brought some people in to help us and I think we did, they did a great job with that. And then on the Hy-Tech side, I think the big pivot, which maybe you’re alluding to, was historically, the business was built on large impacts targeted towards oil and gas, and general construction, and it was a distribution push model.
And that was becoming more and more difficult, as we were starting to see the encroachment in that business from Asian imports and as well as just kind of a general shift away from the Standard Model impact wrench that was more popular moving to more torque control tools and hydraulic tools. So, we took a look at what we were good at, which was engineering and reverse engineering and development in the airspace and said, hey, we can use that brainpower to try to go after what we call OEM business, where we use our understanding of air power. And while we’re not selling necessarily an air tool, we’re selling something that’s an air powered product, or gearbox, or something inside of our larger product, and then from there, we’ve seen an opportunity, what I see as a tremendous opportunity in gears, in general, nationwide, there’s a very fragmented market for gears in the U.S. and that market is very, in my opinion, a good chunk of it is very insulated from foreign imports.
And we’ve seen an opportunity to go out and acquire a number of smaller competitors. And there are many, many others out there, not just in the East, but in the South, in the Midwest. And without necessarily signaling exactly our intentions, we think there’s a lot of runway for us to build quite an operation nationally in the gear business. So, we’ve increased the breadth of products we offer, we’ve doubled even tripled the number of engineers involved in that business. And we’re starting to see some real, we’re starting to get some head turns from some very large companies that buy gears, because they’re used to dealing with one in $2 million companies, and now they’re dealing with a much more sophisticated entity. And so, we’re very excited about the future there, and again, that’s the big pivot, 10 years ago, we were selling half-inch impacts, that was 90% of the business, and that business isn’t there anymore, for various reasons. So, we’ve had to move on. And we still sold plenty of half inch impacts and three quarter inch impacts. But there are other places now to make money.
Joseph Molino
And I’ll make another mention that the Hy-Tech company, we turn the company totally in a different direction. And so, now we get these emails from time to time from people about the Baker Hughes, Rig Count, et cetera, et cetera, that really has very, very little to do with our business anymore, very little. We still know it, but it’s not the tail wagging the dog. So, anybody who’s on this call that does that should understand that.
Timothy Stabosz
Okay, I’ll get back in queue. Sufficed to say, I really appreciate that color, thank you, gentlemen. Sufficed to say, I presume that you still believe that this strategy is something that can earn well into a not to ask for earnings projections but well into a double-digit return on equity, right? Is that fair?
Richard Horowitz
We can’t say that, I can give you a prediction of return on equity but I believe it is the best return for the shareholders, the direction we’re going given the skills we currently have, right.
Timothy Stabosz
Okay, I’ll get back in queue. Thank you for that color.
Operator
[Operator Instructions] And we’ll go next back to Andrew Shapiro.
Andrew Shapiro
Okay, thank you. A follow-up, getting a little more color here on the gear products, are there right before the pandemic hit literally, the week you guys are moving in the equipment from your multiple quality gears entities acquisition? Are there aspects of your strategic goals and expectations for that acquisition that continue to lag as a result of COVID that you foresee still a opportunity for the company? And can you discuss also the integration, timing and milestones of the recently announced Jackson Gear acquisition into PTG, and discuss some of the strategic benefits and synergies you hope to achieve with that acquisition?
Richard Horowitz
Sure, I’ll go first. To your first point, yes, we were moving the equipment as the pandemic hit. And that is a business that is incredibly reliant on engineers sitting around the table discussing some part in front of them or gearbox or system. And while you can maintain business without that face to face contact for the most part and there’s always some attrition, it is incredibly difficult, it is not impossible to grow the business without that contact. And it’s certainly better than it was over the last 24 months. But I think in six months, it’ll be better than where it is. So, we’re not quite at the point where we’ve unfettered access to everybody, but it’s absolutely better. And I see no reason why it won’t get better into you’re alluding to the question. Yes, I think there’s a lot of opportunity yet that we have not taken advantage of, because of the lack of being able to visit. And then you’re asking about the integration of the newly acquired Jackson Gear. All the equipment is moved. For them, I believe all the personnel has been hired to absorb that, the factory is set up in the way that we’re comfortable with, there was a fair amount of electrical work that had to be done, we did have to take we need, did need to take a little more square footage.
As I mentioned earlier, we beefed up engineerings, we’ve actually added more space for engineers, I would say we’re still training some people. The one, there was several nice things about this acquisition, one that was very nice was that while the gears being manufactured by Jackson were certainly on the larger side than the highest end of our production capabilities. The skill set and the machines are quite similar and in some cases identical to the ones we were already using. So, the learning curve was pretty small for our experienced machinist, for the newer ones, they’re learning gear cutting from the beginning, but — so that’s really helped a lot. In terms of milestones, this is my opinion; I think it’ll be a lot more reflective of an opportunity in Q2 than Q1. And I think Q3 is probably really when we get the bulk of the benefits. Although frankly, I think with each passing quarter, we’ll do a little bit better. But Q1 is still transition, Q2 is better and Q3 will be the bulk of the benefit. That’s my opinion.
Andrew Shapiro
And how large was Jackson Gear, what was its revenue base that you acquired?
Richard Horowitz
We didn’t disclose that. But I would say that it’s — it provided a significant increase to the current revenue levels of quality gear and PTG.
Joseph Molino
In a relative sense.
Richard Horowitz
In a relative sense.
Andrew Shapiro
So, we’ll start seeing that in the March quarter results as you close this acquisition in middle of January, right?
Richard Horowitz
You couldn’t — you can’t annualize March, but you’ll absolutely you won’t miss it.
Andrew Shapiro
Okay. And in terms of your capital allocation priorities in such given the still strong balance sheet and the income, the company generated this year and your prospects, I was wondering what metrics, what factors has the board communicated or determined they are waiting for before restarting the company’s modest dividend. What’s the timeline for the company that consider reinstituting the dividend?
Richard Horowitz
Andrew, all I can tell you is, it’s like a broken record. You talk about this every single time and I can promise you and assure you that it is on our agenda every single time we meet that we don’t need your — we don’t need you applauding, we appreciate your concern and your interest, but we don’t need you applauding, we’ve didn’t do anything —
Andrew Shapiro
I think my question is pretty specific, what is the board —
Richard Horowitz
Tell me answer the question.
Andrew Shapiro
Okay.
Richard Horowitz
And when we discussed it at the board, we discussed it with the front — with the bank agreements, with our own capital needs, et cetera, et cetera. And I promise you I’m the biggest stockholder. I will be the biggest beneficiary of it. And when we can do it, we will do it. When we feel it’s something that’s sustainable. We will be having a dividend and there’s nothing more I can really get a more color to it. I can only tell you that, we understood the benefit of the dividend way before it was brought to our attention by anybody else. And we instituted it when we did and we understand very, very well. How we would help the price of the stock and I promise you as soon as we feel that we can that the company is a safe enough position that we can have a sustained dividend, not a one-time dividend, a sustained dividend going forward. We will be having it, when that time comes. Do I think it’s in the foreseeable future? If you ask me my opinion, I would say, yes, but I can’t pinpoint a time for you any better than that. So, I appreciate your interest and your concern on it. But I don’t know how else to answer the question for you. But we — I promise you, we without your questions, we discuss it very, very regularly.
Andrew Shapiro
And I understand my questions are asking for what the factors are, that you guys consider and I don’t know — I don’t see that.
Richard Horowitz
No, no.
Andrew Shapiro
You don’t need to bark at a shareholder for it, you know, to show disdain for your shareholders.
Richard Horowitz
I’m not barking at all. I’m not talking I’m telling you exactly where it is. And we’ve discussed I said, I’m sure you can add any other color that you’d like to add if there is, but we — when we look at, we look at everything, we just don’t look at our shareholders, we look at our operation, which is more important because without our operation, the shareholders don’t have much to do. So, as long as we know the company is in good stead, that’s when the stockholders, all of us included will get the benefit of it.
Andrew Shapiro
Right. Joy, you might —
Richard Horowitz
Now in the — go ahead, Andrew.
Joseph Molino
Go ahead Andrew.
Andrew Shapiro
With respect to the press release, discussing some CapEx, it seems like there’s a decent amount of things on your plate for CapEx for the year. Can you give a little bit more color on the big items here that are planned and what the benefits you see come from that?
Joseph Molino
Andrew, I don’t — I mean, I know there’s a couple of decent sized pieces of equipment we’re looking at really nothing unusual and also bear in mind that a lot of our CapEx, don’t quote me on the percentage, but it could be as much as half is. No, if you’re asking me are we buying three big CNC machines and that’s the bulk of it, it’s not. It’s nothing like —
Andrew Shapiro
No, but are you adding new capabilities or this is mostly replacement? Hello, have you cut the line or are you gone silent? Hello.
Operator
Please stand by.
Andrew Shapiro
Now, I’m here. We can’t hear you guys.
Joseph Molino
You can’t hear us?
Richard Horowitz
Can you hear us now?
Andrew Shapiro
Now we can.
Joseph Molino
Okay.
Richard Horowitz
Okay.
Joseph Molino
Not sure what happened.
Richard Horowitz
Where did we cut you? Where did you got cut off Andrew?
Andrew Shapiro
Pretty much on any explanation on if you are enhancing capabilities or this is more maintenance CapEx to understand maybe you know, if there’s payback and enhanced cash flows and earnings to be expected from the CapEx expenditures.
Joseph Molino
I would say, it’s three things, it’s maintenance, it’s tooling, which is continuous as we bring online of new product, and there are probably a couple of pieces of equipment that would be there to try to increase efficiencies. I think as we start to get our arm around the Jackson customer base. We may see some opportunities that we hadn’t identified prior to the acquisition to create some efficiency. So, it would say, it’s those three things. I don’t think it’s any new market or anything like that. So, it’d be those three things just maintenance, tooling, and then some pieces of equipment that can help us improve efficiency.
Andrew Shapiro
Okay, and also tracking other big things here is what is the size and the status of your Q4 refunds you expected? I’m assuming that is the ERC the Employee Retention Credit that sizably hit this quarter. And can you quantify that and is that the sizable jump that we see in the prepaid expenses? And have you sent received the payment or when do you expect to receive that payment?
Joseph Molino
All right. So, to answer your question, we no, we haven’t. The jump in prepaids is related to is related to that. I mean, what you’ll see also is if you see what our income for the year. Now this is GAAP not tax, but we are showing very little tax expense in relation to the reported profit. So, we have — we had a number of NOLs that were available to us, so that we weren’t showing 26% tax expense on that $2 million gain. So, there is a refund due on the 2020 filing, which we have not received yet. And we don’t know when we’re going to receive it.
Andrew Shapiro
So that’s 2020 income tax coming back.
Joseph Molino
Yes, refund, of course.
Andrew Shapiro
From the NOLs.
Joseph Molino
Yes.
Andrew Shapiro
And then with respect to the Employee Retention Credit, which is a sizable amount that you’ve listed here. Were those taken concurrently or is that another check you expect to get in?
Joseph Molino
There’s no other check. It’s just a check, we aren’t paying, if as I said.
Andrew Shapiro
Right.
Joseph Molino
Well, okay.
Andrew Shapiro
You’re cutting.
Joseph Molino
So, I’m being reminded that yes, so we’ve got I’m confused and confusing you, so we’ve got the NOLs.
Andrew Shapiro
Yes.
Joseph Molino
Which we do hopefully in the next few months related to 2020 return. Then we have the tax benefit related to now recording that expense, which we would expect we’re going to get that back sometime in ’23. But that’s what we’re being told.
Andrew Shapiro
2023 or this calendar year?
Joseph Molino
No. So, let me just — okay, so that the 2020 return generated, like a million dollars in a refund-ish.
Andrew Shapiro
Okay.
Joseph Molino
That’s going to coming in the next few months. We don’t know exactly when. The 2021 return where we filed when we got this Employee Retention Credit, would be generating something like a $2 million refund, but that’s not expected until we’ve been told by our tax people not to expect that in ’22. It will be hopefully only ’23.
Andrew Shapiro
When?
Joseph Molino
We don’t know when.
Andrew Shapiro
Yes, now they take a long time on the ERC.
Joseph Molino
That is cash flow. It is due to us and on the way hopefully from the government.
Andrew Shapiro
Okay. Well, $3 million, approximately, from those two things. That’s $1 a share in cash.
Joseph Molino
It is.
Andrew Shapiro
Yes, okay. That’s nice to know, and we’ll ask about it periodically, as you get visibility on the timing of that. Your press release made no mention of any current shares outstanding number or even the one used for EPS calculations. So, all we have is the prior 10-Q to go off of, can you provide us with the more current outstanding share, or fully diluted share count?
Joseph Molino
It’s unchanged Andrew.
Andrew Shapiro
Okay. So, we’re dealing with about $10.50 frankly more than $10.50 a share and tangible book value and almost $14 a share in book value a share, then give or take, given —
Joseph Molino
Yes, I haven’t done that math of yet lately, but yes, that sounds about right.
Andrew Shapiro
Okay. And you guys obviously feel our company shares are undervalued. When do you feel it would be appropriate for the company to spend any time in addition to these quarterly calls, articulating the company’s investment proposition via incremental and they have these virtual things, where you didn’t even have to leave the comfort of your couch to do a little bit of Investor Relations activity?
Joseph Molino
Well, as we’ve said before, we’ve looked at that periodically, given the trading in the stock, every everyone we’ve spoken to about that said, it’s just not a good use of our resources.
Andrew Shapiro
Well, that’s a chicken and egg issue.
Joseph Molino
We always consider it.
Andrew Shapiro
Yes, it’s a chicken and egg issue. If you don’t tell your story and articulate it beyond these wonderful goals —
Joseph Molino
But Andrew, we can’t create shares.
Andrew Shapiro
Well, you can answer.
Joseph Molino
We can’t create shares.
Andrew Shapiro
No, you don’t need. No, you — that is true, you cannot create shares, but if you create interest for shares and the stock doesn’t appear to be a roach motel where you can get in, but can’t get out. You will have enhanced trading liquidity and you will have a higher price, which will generate even more trading liquidity. It’s again a chicken and egg issue.
Joseph Molino
Okay. We understand Andrew.
Andrew Shapiro
All right, I’ll back out. I have more questions on a few divisions.
Operator
We’ll go to our next caller, Timothy Stabosz.
Timothy Stabosz
You’re not going to believe this, but I actually disagree with Andrew on this one. I don’t think that I mean, Investor Relations is a good thing. And P&F has always needed more of it in my opinion, so I agree with him on that, but I disagree as I — I don’t think there’s enough of a story to tell you. You’ve got to start getting some traction profit wise in showing that these — this is a growth company, the strategies are working, so I agree with the management on this one that more heavy, more heavy hitting Investor Relations efforts are probably not quite, we’re not quite there yet. So, that having been said, I appreciate the discussion around the dividend and the willingness to give some color on that, Richard. Obviously, buybacks have been significant. Strange enough, you bought shares back from the shareholder years ago, I believe, you bought back from Fidelity and accounts gone down from maybe $3.6 million, $3.7 million down to $3.1 million, that’s — with the asset value underlying the company, that’s been a way to increase shareholder value. I do think that, I did actually to be honest with you. Text Mr. Shapiro this morning saying where are the Q4 numbers because I kind of reacquainting myself more deeply with the company as I’ve bought shares the last few months. I did want to second the notion that and very respectfully that I am not aware of a public company on NASDAQ that does not like actually release its Q4 numbers.
So, well, I do appreciate, and on some level, respect, the desire to perhaps keep costs on something from an Investor Relations standpoint and a broadening of the shareholder base. To be a company that doesn’t actually release Q4 numbers is very damaging to the ability to broaden the shareholder base and I really would encourage the board as they listen to call and management to start releasing those numbers and spend that money and put that out there because you might want it to be public. It just so, I just wanted to put make that point out there.
Richard Horowitz
All right, thank you.
Timothy Stabosz
And I might have another, but I’m going to get back in queue. I’m figuring Mr. Shapiro probably has another question. I’m just guessing. Thank you for hearing me out.
Operator
And we will go back to Mr. Shapiro.
Andrew Shapiro
Great. Thank you on a pre-pandemic call. You said progress was developing for AIRCAT in addition to aerospace tools for distribution opportunities in Europe and of course the pandemic hit. But Europe is reopening. Where did those efforts stand? And is new market share and growth still on the horizon for this company in Europe?
Richard Horowitz
Yes, [indiscernible]. By the way, Europe is shutting down; it’s not opening up from what I’ve been reading more and more. But having said that, our people are telling us that they are having the availability of more on site visits in some of the European countries now, and it’s been going on for, I would say, 60 days or something like that. And the numbers are starting to show that improvements in that regard. Is that the question you’re asking?
Andrew Shapiro
Partially, yes, it was AIRCAT and aerospace, you were going to get…
Richard Horowitz
We mentioned that AIRCAT is not opened yet, I think we mentioned that earlier in the call. They claim it’s going to be momentarily but we have not been told that as, I mean Airbus.
Andrew Shapiro
You mean Airbus, Airbus?
Richard Horowitz
Airbus, Andrew I will share this, we now have a warehouse in the EU, in Germany where we stock some AIRCAT, some UT and actually even some Hy-Tech product. And we did that because what we were seeing after U.K. left the EU, it was becoming cumbersome and difficult for our customers to work with us. So, we’ve opened up a small warehouse that’s managed by our German Head of Sales.
Andrew Shapiro
Okay. And regarding the tools, can you provide an update and some more color on your developments of the cordless models and the types of automotive and non-automotive applications for which there are companies developing the cordless models in each of Hy-Tech and Florida Pneumatic, I think on prior calls, you said that beginning of this year, there would be more information on that?
Richard Horowitz
With respect to automotive, we currently are not working on any cordless product. We have some development going on in some other areas, which I’m not going to get into a lot of detail. But it’s been challenging. There have been some supply chain issues and development has been difficult because as you may or may not know that technology is tightly controlled by three very large companies. So, getting into that has been a little more difficult. We’ve been more successful at working with other companies that have some battery technology already seeing what we can do to add on to their system, as opposed to just starting from scratch and developing our own cordless tool. But there is some of that still going on. But progress has unfortunately been held up a bit.
Andrew Shapiro
Yes, thank you. And regarding your new products and experience so far in the Hy-Tech OEM Engineered Solutions, which you again stated that you are emphasizing versus ATP, are there any particular areas, industries or products where they have any call out and elaboration?
Richard Horowitz
Well, I would say that with the addition of Jackson, we’re now into a few other markets that that we weren’t necessarily into before. We’re much bigger into mining than we were and I don’t I’m not talking about mining for coal, although there’s certainly some of that, it would be mining for other metals, both rare and not so rare. And there are opportunities both within the tools themselves. The machines that are involved in mining, all sorts of production equipment involved in mining that we’re seeing. So, mining globally is now a much more important part of our business than it ever was.
Andrew Shapiro
Okay, thank you and the spray gun tools had enjoyed substantial year-over-year increases for many quarters. Are such sales beginning to run up against tougher comps and do you see this business just leveling off or scaling down?
Joseph Molino
Yes, the answer is yes. It’s scaling down and it’s sort of new level, new lower level and it was without a question, without a question.
Richard Horowitz
I think it’s higher than it was pre-pandemic, but lower than the peak of the pandemic. I think how I would describe.
Joseph Molino
I would agree with that.
Andrew Shapiro
Okay, and the Amazon channel, I think you’ve stated it’s continued its growth. Am I correct? And have you seen channels other than Amazon exhibit increases yet?
Richard Horowitz
Other digital channels, Internet channels, I’m not sure what you mean?
Andrew Shapiro
Well, I mean you have your direct to Home Depot, you have your I guess other branded and you go through Amazon, but you’ve had Catalog, Grainger, you’ve had other channels that were meaningful before, is your Amazon growth at their expense or have you seen these other channels exhibit increases yet from the post-pandemic?
Richard Horowitz
The Amazon is almost exclusively automotive. We do sell a few industrial tools there, but it’s automotive. And as I said earlier, it absolutely is at the expense of other channels. So, I don’t know if that answers your question.
Andrew Shapiro
Yes, I guess it pretty much does. I’ll back out into the queue. I may be done even.
Operator
[Operator Instructions] And we’ll go again to Timothy Stabosz.
Timothy Stabosz
I did note in the earnings release. Thank you. I did note in the earnings release the concluding statement, Richard that our goal has always been to serve our customers while improving shareholder value. Interestingly enough, 20 years ago, it’s March 29, 2002 the stock was trading at $7. So, we’ve gotten about $1 plus worth of dividend, stock is $6 now, basically, shareholders have been flat over 20 years. Can you give us reassurance on how the next 20 years may and why it would be different than the last 20 years?
Richard Horowitz
Tim, I don’t have a crystal ball. I can’t possibly answer that question. I’m really sorry. I’d be happy to answer any questions you have that I can have a full, I can’t in this world, I can’t, we can’t look more than three months ahead. How can we look 20 years ahead?
Timothy Stabosz
Is there any context of the fact that the shareholders haven’t made anything the fact that you’ve taken about $25 million out of the company over the last 20 years?
Richard Horowitz
I don’t understand your question.
Timothy Stabosz
Is that part of it?
Richard Horowitz
I don’t understand your question, Tim.
Timothy Stabosz
Okay, thank you.
Operator
[Operator Instructions] And it appears there are no further questions at this time.
Richard Horowitz
Okay, well, thank you all for being on the call today with us and we look forward to speaking to you in May for our first quarter 2022 results. Have a good day all and everybody please stay safe. Thank you.
Operator
This concludes today’s call. Thank you for your participation. You may now disconnect.
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