Greystone Logistics Reports Decline in Sales and Net Income for Nine Months Ending February 28, 2025

Greystone Logistics, Inc. reported a decline in financial performance for the nine months ending February 28, 2025, with total sales of $39.9 million, down 15% from $47.0 million in the same period the previous year. The decrease in revenue was primarily attributed to a 29% drop in demand from one of its significant customers, although this was partially offset by increased demand from another customer due to a newly designed plastic pallet. The company's gross profit also fell to $6.0 million, representing 15% of sales, compared to $9.0 million or 19% of sales in the prior year, reflecting a decrease in production levels.

In terms of operational metrics, Greystone's cost of sales increased to 85% of total sales, up from 81% in the previous year, largely due to a 30% reduction in production. The company reported net income of $1.1 million for the nine-month period, a significant decrease from $3.0 million in the prior year. Net income attributable to common stockholders was $691,942, or $0.02 per share, down from $2.6 million, or $0.09 per share, in the same period last year. The company has also retired 21,000 shares of preferred stock, which has reduced the amount of preferred dividends owed.

For the three months ending February 28, 2025, Greystone experienced a slight increase in sales to $14.3 million, up 2% from $14.0 million in the same quarter the previous year. This increase was driven by higher demand from three significant customers, although it was offset by decreased demand from two others. The cost of sales for this quarter was 81% of sales, down from 87% in the prior year, leading to a gross profit margin improvement to 19% from 13%. Net income for the quarter was reported at $965,665, compared to $297,929 in the same quarter last year.

Greystone's total assets decreased to $49.7 million as of February 28, 2025, down from $52.3 million at the end of the previous fiscal year. Current liabilities increased to $8.3 million, up from $7.2 million, while total equity fell to $22.0 million from $24.0 million. The company had a working capital of $5.9 million and continues to rely on its officers and directors for securing additional financing. Greystone plans to retire the remaining 29,000 shares of preferred stock in the fourth quarter of fiscal year 2025, which is expected to align net income and net income attributable to common stockholders.

Looking ahead, Greystone aims to enhance its customer base and increase sales through marketing efforts and participation in industry trade shows. However, the company acknowledges the risks associated with its reliance on a limited number of customers, which accounted for approximately 76% of sales during the nine months ended February 28, 2025. The company is also facing challenges related to its internal controls over financial reporting, which have been identified as ineffective due to a lack of necessary resources and expertise.