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Gross margin improved 19.4 percentage points from 4% of sales for the second quarter of 2008 to 23.4% this year. While cost cutting and restructuring measures taken in 2008 had a favorable impact on margins, the company has continued to focus on improving efficiencies, expanding distribution and customer base, and updating its product mix with new products. During this difficult period the company, with the full support of Allstate Investments, has continued construction on its Watts, Oklahoma plastic recycling facility which is scheduled to start up later this year. Additional efficiencies are anticipated when this facility comes online.
SG&A costs were reduced by $2.7 million or 48%. The company recorded operating income of $2.2 million for the quarter, an improvement of $6.9 million from a $4.7 million operating loss in the second quarter of 2008.
Commenting on the results, Joe Brooks, CEO of AERT noted, ``A key goal for 2009 is to reduce AERT's overall cost structure and operating costs while maintaining our ability to react to the increase in market opportunities and resulting consumer demands that will inevitably occur. Although overall sales are down, we believe our associates are continuing to gain market share during this difficult period."
Mr. Brooks continued, "Our AERT associates have achieved significant cost reductions while initiating the launch of innovative new products which showcase the true value of Green. AERT President, Tim Morrison and CFO, Brian Hanna are working hard and doing an exceptional job with our AERT team under a process of continual improvement."
"AERT has confidence in the ability of the American public and the economy to recover and grow with remodeling being one of the initial sectors to lead the way. Accordingly, AERT associates continue to fight on and move forward with the support of our lenders, suppliers, and customers in bringing our next generation products to commercial fruition at our Springdale manufacturing hub and at our new Watts facility which will be commissioned later this year," he concluded.
AERT's second quarter conference call is scheduled for Tuesday, July 28th at 4:00 EST/3:00 CDT. To join the call, please dial 800-263-8506. Web access to the conference call can be found at http://www.aertinc.com/investor.asp.
About Advanced Environmental Recycling Technologies, Inc.
Since 1989, AERT (Nasdaq:AERT) has pioneered the use of recycled polyethylene plastic in the manufacture of composite building materials. With its constantly evolving portfolio of patented and proprietary recycling technologies, AERT has been widely recognized as a leader in resource conservation innovation and received the EPA Award for Environmental Excellence for its process of converting scrap plastic to composite outdoor decking. AERT converts reclaimed plastic and wood fiber waste into quality outdoor decking systems, fence systems, and door and window components. The Company is the exclusive manufacturer of Weyerhaeuser ChoiceDek(r) decking, which is available in multiple colors and is sold in all Lowe's Home Improvement stores. See http://www.choicedek.com for more information. AERT's MoistureShield(r) decking program is expanding and products are available in many parts of the U.S. now, with national distribution planned for 2009. See http://www.moistureshield.com for product information or to find a regional distributor or dealer. AERT operates manufacturing facilities in Springdale and Lowell, with a raw materials facility in Junction, Texas and a state-of-the-art recycling facility under construction in Watts, Oklahoma. For more information on the Company, visit http://www.aertinc.com.
The AERT, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4905
Certain statements in this news release regarding projected results of operations, or, projected results of financial plans or future strategies and initiatives, including, but not limited to, projections of revenue, projections of profitability, any and all future expectation, and plans for future activities may and should be regarded as "forward-looking statements" within the meaning of the Securities Litigation Reform Act. These statements involve, among other things, known and unknown risks, uncertainties and other factors that may cause AERT, Inc.'s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. AERT currently is considering, but may or may not in the future implement any or all of the items and issues listed in any planned budget or strategic initiative, due to, among other things, known and unknown risks, uncertainties and other factors.
AERT, Inc. undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, change in strategy, or otherwise. The above-mentioned listing of risks and uncertainties is not inclusive. For a more detailed discussion of some, but not all, of the risks and uncertainties that may affect AERT, Inc., see AERT, Inc.'s filing with the Securities and Exchange Commission, including its Annual Report on Form 10-K, for the fiscal year ended December 31, 2008 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2009.
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Advanced Environmental Recycling Technologies, Inc.
For AERT
Katy Reagan
Investor Relations
479-203-5077
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