Agricultural segment sales fell 30.4% to $2.9M. The company cited high interest rates, low commodity prices, and dealer inventory saturation. However, steady demand in key product lines and cost cuts supported margins. Tariffs and steel supply pressures may impact short-term costs, but the company remains optimistic for growth as conditions improve.

President, CEO and Chairman Marc McConnell reports, “We are pleased to finish the first quarter with meaningful operational and profitability improvements despite challenging conditions that persist. While headwinds continue to affect overall demand in the ag equipment space, we see strength in product categories that are benefitting from favorable beef and dairy prices.

“In our modular buildings segment, the momentum continues, and we are very pleased with both our operational performance and the strong demand we are seeing. In both segments we are keeping a close eye on the impact of tariffs on both our costs and demand profile. Amid quite a lot of uncertainty we do remain optimistic for how we will perform the balance of the year.”

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Operating income (continuing operations): Our consolidated operating income from continuing operations for the 2024 fiscal year was $461,000 compared to operating income of $1,531,000 for the 2023 fiscal year. Our Agricultural Products segment had an operating loss of $1,510,000, and our Modular Buildings segment had operating income of $1,971,000.

Net income (loss) per share (continuing operations): Loss per basic and diluted share from continuing operations for the 2024 fiscal year was $(0.02), compared to net income of $0.15 per share for the 2023 fiscal year.

Consolidated net income (continuing and discontinued operations): Consolidated net income for the 2024 fiscal year was $307,000 compared to net income of $267,000 in the 2023 fiscal year.

Marc McConnell, Chairman, President and CEO of Art’s Way states, “Fiscal 2024 was a year of considerable challenges and transition at Art’s Way, yet one that demonstrated the benefits of our diversification strategy. Amid a significant down cycle in the farm equipment industry, we experienced a reduction in demand along with our industry peers. Meanwhile we benefited greatly from the tremendous growth and operational performance in our Modular Buildings segment. We responded to challenges in our Agricultural Products segment by focusing closely on cost reductions, reducing debt, and improving cashflow while maintaining our emphasis on quality, innovation, and customer experience. We are confident these measures position the company for improving markets in the future and are pleased to report that our current debt level represents a historical low.

Going forward we have meaningful reason for optimism in both business segments for 2025 and beyond. There are positive indications in the dairy and livestock markets that could drive demand for our products serving those markets. We also carry positive momentum into the new year in our Modular Buildings segment that we believe we can sustain. On a consolidated basis we anticipate that solid demand, reduced overhead expenses, improved liquidity and reduced interest expense from debt reduction will result in improved profitability and cashflow in fiscal 2025.”

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Sales for the quarter that ended Feb. 28 increased by 7.5 percent compared to the first quarter of 2020. Net loss for the quarter improved from $437,000 in 2020 to $315,000 in 2021.

Art’s Way also reported strong backlogs into the second quarter.

“While our outlook for the year is positive, we continue to navigate challenges related to increased prices for steel, building materials and purchased components along with availability issues,” said President and CEO David King. “As such, we have raised prices where necessary and are diligently working with suppliers to ensure delays do not negatively affect our ability to deliver products.”

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Consolidated corporate sales for the quarter and nine months ended Aug. 31 increased by 17.5 percent for the quarter and 10.2 percent for the first nine months. The three-month increase is the result of greater sales in agriculture products and modular buildings.

Sales in the company’s tools segment declined for the quarter. All three segments showed increased sales for the nine months of the fiscal year.

Third quarter sales in the agriculture segment increased by 14.9 percent. Year-to-date ag sales increased by 2.7 percent.

Gross margin in the agricultural products segment also improved. It was 15.7 percent for the first nine months of FY2019 and 21.3 percent this year.

The company attributes the gain in gross margin to continuous improvement initiatives that have increased workforce efficiency as well as price increases, strategic product offerings and product eliminations.

“In a year with much disruption and many challenges we were encouraged to see several significant positive trends in the third quarter,” said Chairman of the Board of Directors Marc H. McConnell. “Meaningful top-line growth, margin expansion, and improvements in operational efficiency are key gains that we seek to continue to realize in the quarters ahead.”

Source: Art’s-Way Manufacturing Co., Inc.

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Gunnerson joined Art’s Way in 2004 as senior accountant. She moved into the CFO role before being named CEO in 2007.

Succeeding Gunnerson will be David King, who has been in executive management positions in agriculture for more than 25 years. He has most recently served as vice president of sales and marketing at VES Environmental Solutions. Prior to this role, he was vice president of sales and marketing at Salford Group. King begins as interim CEO next week.

Marc McConnell, chairman of the Art’s Way Board of Directors, said King “brings an extensive skill set and wealth of leadership experience in our industry that we anticipate will provide for growth and long-term success for Art’s Way.”

About Gunnerson, McConnell said: “Through the difficult times in the ag economy and the more robust times, she led Art’s Way with a steady hand and was the ultimate stabilizing force that guided us to where we are today. The example that she set for others of work ethic, professionalism, and dedication has been second to none.”

Gunnerson was elected to the ąű¶ł´«Ă˝â€™s Board of Directors in 2016 and is serving her second term.

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Net sales increased by 16 percent for the fourth quarter compared to the same quarter last year.

The company’s fourth quarter was the strongest it has had since 2014. Sales in the agricultural products segment increased by 59 percent for the final quarter of 2019 compared to 2018 results.

Art’s Way also reported to investors that it reduced bank borrowing by 20 percent, reduced aged inventory significantly, added key members to its management team, built a recurring revenue stream, introduced new products, added potentially high-impact customers, and made significant operational improvements, among other good news.

“For several years we have kept our focus on quality, customer service, innovation, and continuous improvement in our operations and are now beginning to feel the benefit of these efforts undertaken during the difficult times those in our industry have experienced,” said Marc McConnell, chairman of the Art’s Way Board of Directors. “I am confident that this proactivity is helping to drive gains we are making in the business.

“As we look ahead to 2020,” he continued, “we are pleased to have a strong backlog of work in front of us in all segments and expect that this strong demand will continue as international trade deals are finalized, commodity prices continue to rebound, and a degree of certainty and stability returns to the agricultural industry at large.”

Art’s Way Manufacturing also has named Michael Woods as its new chief financial officer. He has been with the company since 2016.

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