QEP Co Inc

OTC:QEPC

Earnings Call Transcript 2023-Q1

[Operator]

Good morning, ladies and gentlemen, and thank you for holding. Welcome to Q.E.P.'s Financial Results Conference Call for the First Quarter of Fiscal Year 2023. [Operator Instructions] My name is Justin, and I will be your conference coordinator today. As a reminder, please note that this call is being recorded.

At this time, I would like to introduce your host for today's call, Stan Berger, Q.E.P.'s Investor Relations representative.

[Stanley Berger]

Thank you, Justin. Good morning, and thank you for joining today's conference call to listen to our discussion of Q.E.P.'s financial results for the first quarter of fiscal year 2023 which were issued in a press release on Thursday, July 14. If you have not had a chance to review the press release and our audited financial statements that are available on the Investors section of the Q.E.P. website and on the OTC market website.

I am joined today by Q.E.P.'s Executive Chairman, Lewis Gould; President and CEO of the Americas, Lewis Gould; CEO of International Operations, Paul Boyce; Chief Financial Officer, Enos Brown; and Chief Legal and Administrative Officer, Adam Morgan.

On today's call, Lewis, Len, Paul and Enos will review the recent developments as well as the highlights of the first quarter of fiscal 2023. We will then give you an opportunity to ask questions.

Before we begin, we would like to remind you that some of our comments today will include forward-looking statements within the meaning of the U.S. federal securities laws. Actual results may differ materially from those projected or implied due to a variety of factors, including, but not limited to, the impact of COVID-19. We refer everyone to these more robust forward-looking statement disclaimer and discussion of these risk factors facing its business in Q.E.P.'s earnings press release and its filings with the OTC markets.

I will now turn the call over to Q.E.P.'s Executive Chairman, Lewis Gould. Lewis?

[Lewis Gould, executive]

Stanley, thank you, and welcome to our shareholders and our stakeholders to the conference call. It's certainly appreciated. And I want you to know that we'll do our best to answer any questions at the end of our brief comments. First, I would say that this quarter has been quite unprecedented for an operating environment for any company. We've been subjected to a higher loan rates, you're certainly aware of that, prime rate; changes in our FX, foreign exchange has affected us both positively and negatively.

We've had unprecedented increases in freight, both in and out and normal pressures that you'd have with things like labor issues, et cetera. And also, we've had tremendous increases involved in our insurance capability. We're fully insured.

At the same time, during the quarter, just some of the very brief highlights are the fact that we're consolidating a lot of our operations, moving into our new facility in Dalton, Georgia, closing 3 facilities at the same time. You'll see some of that reflected in the next quarter and a little bit of this right now.

So our overall efficiency has to go up as we have less shipping locations. One of the highlights of a company our size is that we're international and we get an opportunity where things may slow down in the United States. We've picked up business in Australia and England. And you'll hear a little bit of that certainly as we go forward.

But generally, the items that we have and that we're working on for the balance of the year, will be good, positive and substantial. We've managed to absorb so many of the price increases, and we're slightly behind the curve, getting them. Very pleased with the management and the way we're proceeding.

I don't think we're immune to all of these things as a small company. And I want you to recognize that we are profitable even though these unprecedented amount of cost increases have come through. In all my years of being in business, I've never seen anything like this. Almost every day there's a cost increase, whether it's rent, it's premeditated, the heat, the air conditioning, you name it. It's been a continuing process. But our management and our leadership team has certainly met all of the challenges.

So what I'd like to do is give you specific answers to specific questions as opposed to repeating what you've seen in the press release. So I'd like to turn this over operator to questions that we may have available now.

[Operator]

[Operator Instructions] At this time, I am showing no questions. I'll now turn the call back over to Lewis Gould for closing comments.

[Lewis Gould, executive]

Thank you, Stanley. Thank you, operator, and the people that are on the line. The closing comments, we're ready for any of the questions. I do want to tell you that generally, we're working quite hard, we've invested in the future. We're rebuilding our adhesive facility. Overseas, we've had good luck with our rollout of Tile in Australia. We've been profitable just about everywhere, and we're very cognizant of the challenges that are up.

I do want to thank all the people certainly that our shareholders that have worked with us, our directors that have provided guidance; and certainly, all the people that work for Q.E.P., they're too numerous to mention, some of the successes that we've had because when you read the press releases, you read the great numbers. But I can tell you that from a personal perspective, everyone has gone yeoman's work and the light is on 7 days a week, somewhere in the Q.E.P. system.

We've reported fully on the over-the-counter exchange for any of the financial information that you've had, we're looking forward to growing our business this year. That's the only guidance I'd tell you and we're controlling costs wherever it's all possible. And we're looking under every rock to find $0.05 or $0.01, whatever we possibly can do. So we're very prudent and we're very conservative in our outlook.

Anyway, I want to thank all of our shareholders, again, God bless America. Let's hope that things continue to do well. And if there's a recession, it's only a mild one. Thank you for joining the conference call.

[Operator]

Thank you. This concludes our program for today. You may all disconnect.