Hi Jeff and again Happy Easter. As I read over this most recent 10-K, I found to be of particular the following from that 10-K:
“During the period 1996-1998, the Company has been able to generate cash in amounts that were adequate to meet its cash needs. The ratio of current assets to current liabilities represents the Company's liquidity. The liquidity ratio at December 31, 1998 was 6.06:1 compared with 7.34:1 at December 31, 1997 and 8.31:1 at December 31, 1996. Current assets were up when comparing 1998 to both 1997 and 1996. When comparing 1998 to 1997, the primary increases in current assets were shown by the rise in cash balances and accounts receivable generated from the Altair operations. When comparing to 1996, one major increase was in inventory, which reflects raw materials inventory acquired in connection with the Company's purchase of the Altair property. Current liabilities increased when comparing 1998 to 1997 and 1996, because of short-term bank notes.”
AND
“It is important to note that the Company has no long-term bank debt and its property and equipment are free from liens. The Company has no commitments for capital expenditures as of December 31, 1998. GTII plans to continue its policy of acquiring property and equipment primarily out of cash flows from operations as it has during the past. However, the Company has established a line of credit totaling $275,000 for short term acquisition needs expiring in December 1999. The bank line of credit is at prime rate plus 2%, currently 10.5%, is secured by accounts receivable, and requires interest to be paid monthly. The Company borrowed $171,200 through this line of credit during 1998 to meet cash flow requirements, and this balance was outstanding at December 31, 1998. The Company has no plans to incur long term debt. “
AND
“Subject to the considerations discussed in the preceding paragraph, the Company is not aware of any trends or demands that would be likely to reduce its ability to generate cash sufficient to meet its needs in any material way.”
Based on this information, I must say the GTII is one of very few that operators basically with cash on hand and little or no debt. WOW!
Now here is a company, Golden Triangle Industries, Inc (GTII) that has ONLY a total of 602,000 shares outstanding with only 300,000 in float. The per share value is now around $12.00. Just think, as little as 6 months ago it was selling for around $5.00 or 41% of the current value. Recently and over the last three months it has been trading for about $8.00 or 2/3rd of current value and within the last week it has move up to $9.00 on low volume. Still what a bargain GTII is in my opinion.
So Jeff, with a management team such as the one for GTII and if their philosophy continues as has been. Then Jeff, here I go with just a little prediction on my part, GTII is a longer term play, but it is really going to be a winner for you and I. By the way Jeff this is the first stock I have ever owned that had only a float of as little as 300,000 shares.
Regards,
Bill Fortune III
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