Replies to post #321 on Greystone Logistics Inc. (GLGI)

[Phaedrus77]

I think you guys are overthinking the GM decline. Here are the gross margins by year:

2015Q1: 21.91%
2014: 22.78%
2013: 21.83%
2012: 20.41%

The reason Q1 looked so bad was because Q1 2014's GM was 32.95%. If Q1 2014's GM was 22.78% (i.e. the average for the year), then operating income was *only* down 19%, rather than the 54% that the financials show.

The good news is that the GM for Q2 & Q3 of 2014 was 16.65% & 16.09%, respectively. If you believe that Greystone's true margin is ~22-23%, then Q2 and Q3 2015 operating income should be quite a bit higher than 2014 Q2 & Q3.

If there's one thing to worry about, it's the declining Miller revenue. The growth in other pallet sales is largely offsetting it, but it's never a good thing to see sales to your largest customer drop so much.

I was hoping for an AB announcement this fall, but given Dan's information about the keg samples being shipped in October, I think it's still too soon to give up hope for an announcement.

Also, it looks like Kruger bought another 34k shares yesterday.