AMERICAN INTERNATIONAL INDUSTRIES, INC.
601 CIEN STREET, SUITE 235, KEMAH, TX 77565-3077
Tel: (281) 334-9479 Fax: (281) 334-9508
www.americanii.com email: firstname.lastname@example.org
FOR IMMEDIATE RELEASE
AMERICAN INTERNATIONAL INDUSTRIES, INC.
REPORTS RECORD REVENUES AND QUARTERLY OPERATING INCOME
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2008
Houston / Kemah, Texas – November 14, 2008 American International Industries, Inc. (NasdaqCM: AMIN) reported record revenues of $13,632,262 for the three months ended September 30, 2008, compared to $8,276,370 for the same period in the prior year, representing an increase of $5,355,892, or 65%. The increase in revenues is primarily due to higher revenues at the Company’s subsidiaries, Delta Seaboard Well Service and Northeastern Plastics. Delta’s revenues increased by $3,786,065, or 131%, and Northeastern Plastics’ revenues increased by $2,850,884, or 123%, compared to the same period of the prior year. For the nine months ended September 30, 2008, the Company reported record revenues of $28,844,385, an increase of $6,928,150, or 32%, compared to $21,916,235 for the same period of the prior year. Revenues increased at Delta by $5,293,187, or 61%, and at Northeastern Plastics by $2,327,267, or 38%. The increase in revenues at Delta was due to increased drilling activity creating greater demand for pipe and well services. The increase in revenues at Northeastern Plastics was due to a large seasonal direct import order, which previously shipped in the 4th quarter of 2007 and the addition of new sales from a large national retail chain. Hammonds revenues for the three and nine months ended September 30, 2008 decreased by $1,281,057 and $692,304, respectively, due to delays in certain materials required for specific job completion and shipping delays due to Hurricane Ike. Hammonds is pursuing claims under its insurance policies for lost income and additional expenses.
The Company’s consolidated net income from operations for the three months ended September 30, 2008 was $366,484, compared to a net loss from operations of $1,026,528 during the same period of the prior year, representing a significant increase of $1,393,012, or 136%. Delta and Northeastern Plastics had net income from operations of $1,606,713 and $311,368, respectively, for the three months ended September 30, 2008, and Hammonds’ net loss from operations was $894,566 during the same period. Operating expenses include non-cash items, such as depreciation, amortization, and stock based compensation. Excluding non-cash expenses, our operating income was $1,123,921 and operating loss was $238,605, respectively, for the three and nine months ended September 30, 2008. For the three and nine months ended September 30, 2008, depreciation and amortization was $357,198 and $1,048,832, respectively, and stock based compensation was $400,240 and $720,768, respectively. The decrease in net loss from operations was due to an increase in revenues and a decrease in general and administrative costs as a percentage of revenues to 30% for the three months ended September 30, 2008, compared to 51% for the same three months in the prior year. Consolidated net loss from operations for the nine months ended September 30, 2008 was $2,008,205, compared to a net loss of $3,251,518 during the same period in 2007, representing an improvement of $1,243,313, or 38%. Selling, general and administration costs as a percentage of revenues improved to 41% for the nine months ended September 30, 2008, compared to 51% for 2007.
Net loss was $2,037,301 and $5,041,848, respectively, for the three and nine months ended September 30, 2008, compared to net losses of $1,363,542 and $3,343,808, respectively, for the same periods in 2007. Marking to market the decline in value of our stock portfolio had a significant impact on our net loss. Our non-cash unrealized loss on trading securities for the three and nine months ended September 30, 2008 of $1,578,551 and $4,160,535, respectively, represents 77% and 83% of our total net loss, respectively. Our net loss includes a net realized/unrealized loss on trading securities of $1,570,137 and $4,180,982 for the three and nine months ended September 30, 2008, respectively, compared to a gain of $219,068 and $232,433 for the same periods in the prior year, respectively. The net unrealized loss on trading securities of $4,160,535 for the nine months ended September 30, 2008, was due primarily to decline in the value of our investments in OI Corporation and Rubicon Financial Incorporated of $3,757,591. Net income for the nine months ended September 30, 2008 includes $2,945,133 for recognition of the property dividend distribution gain associated with the declaration of the Hammonds’ stock dividend and $1,450,000 for the Delta lawsuit settlement. Delta recognized other income from a Texas Emissions Reduction Plan (TERP) grant in the amount of $57,589 for the nine months ended September 30, 2008 compared to $431,595 for the nine months ended September 30, 2007. In October 2008, the Company reduced its holdings in trading securities by $1,977,486. The impact of these transactions on net income is a loss of $11,018.
Our net losses include 100% of the net losses from our 48% owned subsidiary, Hammonds Industries, Inc., for the three and nine months ended September 30, 2008, of $995,348 and $2,471,957, respectively. In accordance with accounting principles generally accepted in the United States of America, the Company does not record a minority interest offset to these losses, which would result in an improvement to our losses for the three and nine months ended September 30, 2008, of $517,581 and $1,285,418, respectively. The minority interest is not recorded because Hammonds’ equity applicable to its common shareholders has a negative balance.
Update on 287 acres of waterfront property in Galveston County
As previously announced, management determined not to extend the Westfield contract beyond October 31, 2008. The Company was advised by Westfield that due to unforeseen serious health reasons of its main principal, Westfield could not finalize all of the permits and financing for the development of the 287 acres, timely. Westfield delivered to the Company all of their studies and project development documents. Management believes that this property and its development plans will sell for substantially more than the $16,000,000 price for which the property was being sold to Westfield, due to the fact that the property is in a rapidly growing Galveston / Houston, Texas metropolitan area and real estate in the surrounding areas have increased substantially in value in the past 24 months, notwithstanding the decline in the U.S. real estate market. The Company has engaged CBRE on an exclusive basis to sell the property for an increased listing price of $25,000,000.
American International Industries, Inc. is a growing diversified holding company with a business model emphasis on enhancing assets and stockholders’ equity to facilitate substantial future revenues and earnings per share. Ms. Sherry Couturier, Chief Financial Officer, stated "During the past five years, the Company has increased assets to $45,009,020 at September 30, 2008, representing an increase of $33,841,871, or 303%, from $11,167,149 at December 31, 2002; the Company has increased stockholders’ equity to $19,033,596 at September 30, 2008, or an increase of $10,909,869, or 134%, from $8,123,727 at December 31, 2002."
For more detailed information, please refer to our September 30, 2008 Form 10-Q filing with the SEC on November 14, 2008.
American International Industries, Inc. is a diversified holding company, with a business model similar to General Electric, Tyco International, and Berkshire Hathaway. The Company has holdings in Industry, Finance, and Real Estate in Houston Texas and surrounding areas, and Oil & Gas. The vision of the Company is to develop holdings in various industries through acquisition of existing companies, applying the financial resources and management expertise to foster the growth and profitability of the acquired businesses. The holding company serves as a financial and professional partner to the management of the subsidiaries. The role of the holding company is to improve each subsidiary’s access to capital, achieve economies of scale by consolidating administrative functions, and utilize the financial and management expertise of corporate personnel across all units. The Company is continuing to work with management of the subsidiary companies to improve revenues, operations and profitability.
Private Securities Litigation Reform Act Safe Harbor Statement:
The matters discussed in this release contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended that involve risks and uncertainties. All statements other than statements of historical information provided herein may be deemed to be forward-looking statements. Without limiting the foregoing, the words "believes", "anticipates", "plans", "expects" and similar expressions are intended to identify forward-looking statements. Factors that could cause actual results to differ materially from those that we may anticipate in each of our segments reflected by our subsidiaries' operations include without limitations, continued acceptance of our products and services, continued growth in the energy sector, increased levels of competition, the dependence upon adequate financing, third party suppliers and the ability to hire and retain qualified management for its operating subsidiaries, and the regulatory environment in the segments in which we operate. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis, judgment, belief or expectation only as of the date hereof.
Investor Relations: Rebekah Ruthstrom Tel: 281-334-9479 email: email@example.com