national presto industries: leakage in its absorbent products segment - water absorbent products
It's hard to imagine that a company that has been running for more than a century will be undervalued. followed.
When the company has 69-
We are even more confused by this year's dividend record.
Some of its products are innovative but good now
Household staple food known and standard.
There is no point in why stocks are not traded in large quantities.
Company HistoryA quickly browse the history of the National Presto industry (NYSE:NPK)
One is fascinated by its mark in the United States.
At the beginning of 1905, the predecessor of the National Presto, the Northwest Steel plant, manufactured pressure tanks for commercial use.
USDA recognizes pressure tanks as the only safe way
Acidic food in 1917
Commercial cannery was forced to use pressure cannery equipment.
In the same time frame, the domestic pressure can was designed and manufactured.
Between these two areas, the company has grown into one of the largest companies in the world.
It identifies the name change of the national pressure cooker company as a better option.
The "Presto" brand was born at the end of the 30 th century, when the company developed a pan while trying to satisfy family consumers --style cooker.
World War II changed the pattern of American manufacturing.
The company has temporarily stopped production of pressure cookers and has begun production of artillery fuses, air bombs and rocket fuses.
After the war, the production of household cooking utensils resumed.
Although Presto's brand has entered the market, it has sold more than the total sales of all other competitors.
As the country recovers and companies flourish, it turns its attention to the family.
The company's product line includes a steam iron, an electric cooker that can be washed in water and a coffee machine.
During this period, the name was changed again to the National Presto industry.
As of 1969, the New York Stock Exchange launched the National Presto.
Over the next few decades, prepresto has introduced a product concept that meets the consumer's needs for convenience, comfort, and health choices.
FryBaby, Salad Shooter, PrestoBurger, PopCornNow and Pizzazz pizza ovens all leave their marks in the kitchen.
Recently released products include fold-
Appliances, dehydrators and corn sticks for delicious popcorn.
The US defense secretary did not forget the detour to enter the defense industry.
Presto acquired AMTEC in 2001.
AMTEC has manufactured ammunition, fuses, shooting devices and other precision products for the United StatesS.
Ministry of Defense.
At 2003, 2006 and 2011, AMTEC acquired three more ammunition manufacturers.
Its ability to expand to include the circle (
Loading, assembly and packaging)
Work, ammo boxes, and non-lethal ammunition such as smoke grenades, tear gas grenades, stun ammunition, gas masks, etc. In 2005, the U. S.
The Army selected two suppliers for a large number of five suppliers
Annual Contract for practice and tactical ammunition.
AMTEC was selected as one of them and received most of the awards.
The final delivery under the than contract was completed in 2012.
In 2010, the Army awarded AMTEC a second 5-year contract.
AMTEC again gained a large share of the management and production requirements.
National Presto's third business unit, absorbent products, also started with the acquisition in 2001, followed by the acquisition of another business unit in 2003.
The focus of this part is private.
Label adult incontinence products.
The Presto home products division tends to follow seasonal trends, with sales rising in the fourth quarter during the holiday season.
The AMTEC Defense Department relies heavily on sales to the United States. S. government.
Unlike the first two parts, the part of the absorbent product is neither seasonal nor entirely dependent on a single entity.
The following chart describes the financial performance of Presto over the past five years.
The details in the chart are not displayed in a typical way.
This is intentional in order to present a snapshot of the financial situation of the Presto state.
Income is hundreds of millions.
Net profit is tens of millions.
As with several other companies, it is also relevant to know that state Presto paid a 2013 dividend in December 2012, as the 2013 tax rate on capital gains is uncertain.
Finally, 2013 of revenue, net income and EPS amounts are based on the first and second quarters of the report, as well as the estimates for the past two quarters based on historical trends.
As shown in the figure, the financial crisis at the end of 2009 actually had a positive impact on the performance of National Presto in 2008.
According to management, 2009 is a record year: However, 2010 is a different story: as shown in the figure, the recent series of challenges began after 2010.
It is unrealistic for ChallengesIt to use only one fragment as the source of the Presto challenge for all countries.
The household goods market has experienced irritating fluctuations, mainly due to consumer sentiment about the product and the overall economic shadow. .
The defense component relies almost entirely on government contracts.
But absorbing the challenges in the product space makes one wonder why a company is even engaged in the business.
The company explained the overall business challenge in its 2012 annual report: National Presto experienced the first profitable period in the sector in 2009.
By the end of this year, however, its capacity was also limited.
In response, the board of directors of the state Presto authorized the department to expand by $30 million.
However, capacity constraints are not the only challenge.
The concentrated efforts made in 2009 to expand the customer base of the segment also resulted in consequences.
In response, a major customer chose to build their own facilities.
The customer accounted for 11% of the company's sales in 2010 and 12% in 2011.
This means it is responsible for more than half of the revenue in the segment.
By the end of 2011, the customer's facilities had been put into use.
Prepresto felt the impact of the decline in sales in 2012.
Sales fell by 16% from 2011 to 2012.
The uncertainty of foreign governments also hit hard in 2012.
On 2011, National Presto signed a royalty agreement with another absorption product company in another country (not disclosed).
Sales to the company were discontinued in 2012 due to continued financial difficulties.
National Park also decided to write-
Close the equipment and accounts receivable of the company's manufacturing facilities. The write-$11 discount.
$2 million contributed significantly to $11.
1 million running loss.
After the event, the benefits of seeing is 20/20.
But the reality is that decisions are made based on the information they had at the time.
At the end of 2009, the board of directors of the National Presto knew that the company was facing capacity restrictions in the area of absorbing products.
The logical conclusion seems to be to increase capacity.
Unfortunately, according to the operation of the past five years, the water absorption product department has earned a meager $0 nationwide.
62, less than 2% of five-
Total annual EPS of the company.
The following three charts describe the contribution of each segment to the total.
Although the first chart does not reflect the stable or prosperous household goods section, it pales in comparison to the problems reflected in the absorbed product section.
The next chart describes the combination of the household goods section and the defense section that do not absorb the product section.
When viewing next to the water-absorbing product segment diagram, it is fair to question whether the management and operation of the other two segments are affected by the problem of the water-absorbing product segment.
Finally, the last chart shows that the absorbed product part has increased EPS in each year and also reduced EPS from EPS.
However, it makes it clear that this segment is a constant drag on operating margins for the company as a whole.
The 2013 outlook for February was mixed.
The household goods industry is described as "highly competitive and costly ".
But the outlook for the future is that diversity and interest are growing.
The main concern of the Defense Department is the isolation and withdrawal of Afghanistan.
However, exit is not expected to affect 2013 euros.
The loss of major customers still masks the area of absorbing products.
However, the expansion of the customer base, which began in 2009, has led to new customers with "great potential.
Presto has $81 million in cash and doesn't have a long timeterm debt.
Friendly as it has a high dividend payout rate.
Although dividends are paid annually rather than quarterly, special dividends are usually included in the National Presto.
Similarly, it has a record of dividends for 69 years.
Insider's shareholding is as high as 30%.
But for many financial ratios and metrics, the trend line has been moving in the wrong direction.
At the end of fiscal 2012, the categories listed in the table below are all 5-year lows.
The table compares the status of 2012 to the latest report of 2013 in the second quarter.
As shown in the figure, the only category currently reversing the trend is book value, current assets and common stock.
Observing the National Presto is the p/e ratio, which is about 3 points lower than the Standard & Poor's average.
Looks like a bargain.
However, at this point, investment in the National Presto is only wise for risk --adverse.
Third-quarter earnings of 2013 will be announced at the end of October.
Interested investors should look for the following to show a reversal: new investors must also remember that the fourth quarter always shows a positive seasonal high income.
In addition, a dividend of 2013 was paid in early December 2012.
Overall, the assessment of the National Presto investment is likely to wait until early 2014.
One event worth reassessing is a press release announcing the sale (
(At least I didn't say "dispose ")
Absorb market segments of products.
Disclosure: I do not have a position in any of the stocks mentioned, nor do I have a plan to start any position in the next 72 hours.
This article was written by myself and expressed my views.
I received no compensation (
In addition to Seeking Alpha).
I have no business relationship with any stock company mentioned in this article.