AstroNova Inc (ALOT) 2008 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by.

Welcome to the Astro-Med, Inc., third quarter fiscal 2009 earnings conference call.

(OPERATOR INSTRUCTIONS).

This conference is being recorded today, Thursday, December 4th, 2008.

I would now like to turn the conference over to Stanley Berger.

Please go ahead, sir.

Thank you.

On behalf of the management of Astro-Med, we are extremely pleased that you have taken the time to participate in our conference call.

Thank you for joining us to discuss the Company's fiscal 2009 third quarter financial results and business outlook.

Before I introduce management, I would like to remind everyone that certain statements made during the course of this conference call, especially those that state management's intentions, hopes, beliefs, expectations, or predictions for the future are forward-looking statements.

During the conference call, we may have made forward-looking statements within the meaning of the Securities Exchange Act of 1934.

These statements are based on the Company's present expectations and beliefs concerning future events, and are necessarily based on certain assumptions which are subject to risks and uncertainties.

Actual results may differ materially from those discussed here.

More information on these risks is included in the Company's filings with the Securities and Exchange Commission.

By now, you should have received a copy of the news release, which was issued yesterday after the market closed.

If you have not received a copy, please go to our website at www.astro-medinc.com, where a copy of the press release can be downloaded from the investing section of our home page.

Hosting the call today are Albert Ondis, Chairman and Chief Executive Officer; Everett Pizzuti, President and Chief Operating Officer; and Joe O'Connell, Senior Vice President, Treasurer and Chief Financial Officer.

At this time, I will turn the call over to Mr.

Ondis.

Albert?

Thank you, Stanley.

And as Stan mentioned, with me here on this open phone are Everett Pizzuti, the President and Chief Operating Officer, and Joseph O'Connell, Senior Vice President and Chief Financial Officer.

And after I finish my brief report, you will be hearing from them; and following these presentations we will be taking your questions.

As you know from the report we issued yesterday after the close, we did, I would say, okay in the third quarter; although we certainly missed our targets due to the grim economic situation that we're facing.

You're going to hear more about our results when Everett and Joe give their detailed reports in just a few minutes.

Where do we go from here?

Well, first, let's take a brief look at various parts of our business.

Our test and measurement instruments group were up by a little over 9% during the quarter, and we have no reason to think that this will not continue.

Our ruggedized products, which are a component of our test and measurement group, are slightly suffering, due to the delays by Boeing with the 787 airplane, and Airbus with both the A380 and the A400M planes.

But indications are that these programs will shortly be back on track and we, meanwhile, are getting new orders from other less well-known contracts that we have.

And so we are confident our ruggedized business is quite healthy and will deliver good results for us in the future, certainly by the first or second quarters of the new year.

Our Grass technologies business is especially promising.

The strongest part of the Grass business is what we refer to as the sleep diagnostics business.

And during the quarter which just ended, it was up more than 30%; and by the way, the outlook is excellent that this will continue.

Overall, the largest piece of the business of Astro-Med is our color label and consumables activity, which we call Quick Label Systems.

And although this is a "business to business" business, our customers serve a large number of retail customers who produce labels for beverages, foods, auto tires, and a range of other products that are all identified with the retail trade.

And of course, the retail business is down slightly and it will not become dynamic and vigorous again until retail customers begin buying again; and when that will happen, I guess your guess is probably at least as good as mine.

Looking at our business overall, therefore, we do expect growth for the next couple of quarters, but it will be rather nominal growth.

Thanks to our conservative management practices over the years, we feel that we have before us a great opportunity right now to use our strong balance sheet to make some advantageous acquisitions at favorable prices, and we have begun the process right now by identifying some attractive targets.

And as we've said before on the subject of acquisitions, we will make acquisitions solely that will fit into our present business mold.

We're not going to acquire any business that will not -- that will take us far afield from the businesses that we know.

And secondly, any acquisition that we make must be accretive to both profits and revenues.

The overarching business plan, therefore, is firstly to concentrate on growing our present businesses through continued research and development of new products, as well as by continuing to strengthen our sales and marketing activities, and then by acquiring accretive businesses to stimulate our business.

And with that said about what our ongoing plans are, I'm going to turn the meeting over for a moment to Everett Pizzuti, President and Chief Operating Officer.

Everett?

Thank you, Albert, and good morning, everyone.

I have a brief report this morning.

You may remember during our conference call on August 20th, we stated that most of the quick label system products that we sell are to manufacturers in a wide range of products for the industrial and retail markets.

We went on to say that based on the slump in the general retail market at that time, we anticipated some additional softening in the market for our printers and consumables.

And as you all know, economic conditions did indeed continue to degrade since July, and so we experienced softening in demand for our quick label systems products in our third quarter.

We hasten to point out, however, that sales of these products are by no means so soft as to produce an unprofitable bottom line.

Really, interest in the color printers remains quite high, even though final decisions to purchase are postponed temporarily.

Although sales of color printers were down in the quarter, we're happy to say that consumable sales were up by nearly 3.5%.

Our third quarter, as you know, includes August, a traditionally heavy vacation month for many of our customers around the world.

As a result, sales are usually lower than in the second quarter.

On the T&M front, sales were impacted mainly by delays in shipments of the ruggedized products, due to postponements by both Boeing and Airbus.

We expect, however, to ship more of the ruggedized products in the fourth quarter.

Our Dash products, however, were up over 20% in sales from domestic customers.

We see this trend continuing in the fourth quarter, as orders for Dash products continue to come in from a wide range of customers in aerospace and industry.

Moving to our Grass products for the medical applications, although sales were down from our targets, we did receive some very good orders that will be shipped -- that will be shippable in the fourth quarter.

Additionally, new opportunities and quotes for our Grass products, Sleep and EEG, increased substantially, paving the way for a strong fourth quarter for Grass.

Sales from Europe and our branch offices were up for all product groups -- quick label, test and measurement and Grass -- and we expect this to continue in the fourth quarter as well.

Overall, we see the fourth quarter up over the third quarter in both sales and earnings.

And that's my brief report, Albert.

All right.

Thank you, Everett.

And now Joe -- Joseph O'Connell -- our Senior Vice President and Chief Financial Officer.

Joe, let's hear from you.

Good morning, everybody.

Thank you, Albert.

Appreciate that.

Well, let me -- you've heard some of the specifics.

Let me just put some of the numbers to some of the comments that you've heard from Albert and Everett.

Good morning, again.

As you heard, Astro-Med's third quarter was ended November 1st, 2008.

And as you've heard, the Company's sales in the third quarter were $17.681 million, representing a 7.6% decline from the third quarter sales of the previous years.

Our sales volume through our domestic channels reached $12.653 million, being lower by some 7% from the domestic sales volume reported in the prior year.

International shipments were $5.027 million, representing 28% of our total sales, and were lower than the previous year's third quarter sales by approximately 9%.

Hardware sales, which as you heard is the prime reason for the lower sales, at $8.037 million; while our consumable and service and other sales at $9.6 million were actually up 1% year-over-year for the third quarter.

If we profile the third quarter sales by segment, we have our test and measurement group, including the ruggedized, at $4.1 million for the quarter.

Again, mixed results here -- and as you heard, strong performance by the Dash line, which was up over 21%.

However, as you heard, the delays for the 380 and the 787 aircraft caused a lower sales level for the ruggedized product.

As a consequence, the overall sales for the test and measurement product group was down.

Sales in our quick label systems product group were $9.232 million in the third quarter, lower by just about 7% from the prior year sales of $9.917 million.

Again, here as you heard, the hardware sales were the prime reason for the lower sales, as -- also as you heard from Everett, our consumable business was up by some 3.5% year-over-year.

The Grass technologies product for the quarter was $4.351 million, being basically lower than last year's sales of $4.763 million for the same period time -- time frame.

Here, the Company's clinical markets were flat year-over-year; however, as a result, we had strong Sleep and strong EEG sales, unfortunately offset by lower long-term epilepsy monitoring sales.

We also saw some softness in our research instruments business, as some of the grant funding has slowed down.

Gross profits.

Gross profits in the quarter were $7.647 million -- that's down 8.7% from the prior year's gross profit, but does reflect a margin of 43.3%, slightly lower than last year's margin of 43.7%.

Operating expenses in the quarter were down at $6.558 million, which represents some $0.37 on the sales dollars.

Our selling and G&A spending was down 2.7.

However, as we continue to invest in new products, our R&D spending was up 5.9% at $1.254 million.

The Company earned income from operations of $1.089 million in the quarter, with a corresponding profit margin of 6.2%.

This result is behind last year's operating margin of $1.7 million, with a corresponding margin of 9.1%.

In the quarter, our other expense was $237,000, representing a mix of dividend and interest income, offset by some exchange losses as a result of the currency and the stronger dollar.

Our tax position -- the Company's federal, state and tax provision in the quarter was $203,000, reflecting an effective tax rate of 23.8%.

The lower rate being traceable to a benefit of $71,000 related to the recently passed extension of the R&D tax credit and a benefit related to differences between the prior year tax provision and the actual returns that we filed.

As a consequence, the Company earned $649,000 in the third quarter, reflecting an earnings per share of $0.09 and a return on sales of 3.7%.

The prior year's net income for the third quarter was $1.562 million, or $0.21 per diluted share.

The prior year's net income did include a tax benefit of $446,000, or $0.06 per share, related to the completion of an IRS examination and certain exchange -- changes in uncertain R&D and foreign tax positions.

Prior to discussing the balance sheet, I thought a review of the nine month results would be appropriate at this point.

The Company has achieved sales in the first nine months of $56.152 million as of the end of November 1st, 2008.

The year-over-year growth is 3.5%, with our domestic sales at $39.177 million, up 2.6%, and our international shipments at 16,975,000, up 5.8% from the prior year.

This year's sales were distributed by segment as follows.

Our test and measurement including, the ruggedized product, is at $12.549 million, up 1%; quick label system at $29.616 million, is up 4% over last year; and our Grass technologies business at $13.991 million is up 5% year-over-year.

The Company did realize gross profits for the first nine months of $24.516 million, reflecting an improvement of 6.4% over the prior year, and representing a margin of 43.7% against last year's 42.5%.

Spending in the selling, R&D and G&A accounts increased 4% over last year to $20.203 million.

Our selling G&A expenses were up 3.2% to $16.523 million, whereas our R&D spending increased 7.7% to $3.68 million, representing some 6.6% of our sales dollars.

Astro-Med has earned some $4.313 million in operating income for the first nine months.

This result reflects an improvement of 19.1% over the previous year's operating income, as well as providing an operating profit margin of 7.7%.

That's some 100 basis points improvement over the prior year operating margin.

Other income and expense for the nine months is flat as a result of the interest and income, and dividend income being offset by the foreign exchange losses.

Tax provisions.

We have provided federal and state income taxes of $1.612 million for the nine month period, reflecting an effective tax rate of 37%.

The prior year's effective tax rate was 30% for the comparable period, as the Company incurred some one-time tax benefits that lowered the effective rate in the prior year.

Astro-Med earned $2.701 million in net income during the first nine months of the current fiscal years.

These results translate into $0.36 per diluted share and a return on sales of 4.8%.

For the corresponding period in the prior year, the Company earned $2.969 million, or $0.39 on a diluted per share basis.

The prior year's net income includes some $446,000 or $0.06 per diluted share related to favorable resolution of certain income tax examinations.

Quickly moving to the balance sheet, the Company has increased its cash position from the beginning of the year by some $4.537 million or roughly 26%, to $22.093 million at the end of the third quarter.

Our trade accounts receivable have declined in the same timeframe by some $2.387 million to $10.374 million, representing some 53 days sales outstanding, a five day improvement from year end 58 days sales outstanding.

Our investment in inventories are also down from the beginning of the year.

Current, the quarter's balance is down by some $1.345 million, or approximately 10%, to $12.706 million, representing 114 days on hand -- again, an improvement in our turnover from year end's 126 days outstanding.

The Company had spent on capital expenditures during the first nine months $1.211 million, primarily associated with building improvements, machinery and equipment and information technology investments.

Again, the total spending on capital expansion is slightly higher than our depreciation expense for the first nine months of $1.1 million.

The Company has paid cash dividends of $1.258 million, representing $0.06 per share per quarter.

Our book value at the end of the third quarter is $7.34 -- that's a 5% improvement over the year-end balance.

Our employee population is flat with year-end at 398 folks.

And we improved our sales per employee from year-end to $180,000 per employee to $187,000 per employee at the end of the third quarter.

That completes a review of the financials.

Thank you very much.

Before we take your questions, let me give you another view of our guidance.

We're currently saying that for the 12 months of the current fiscal year which ends at the end of January, that our total revenues will range between 74 and $76 million, and earnings per share will range between $0.45 to $0.50.

(Inaudible), I think we are ready for questions now.

Thank you.

(OPERATOR INSTRUCTIONS).

One moment, please, for our first question.

Our first question is from the line of Harvey Shafren, private investor.

Please go ahead.

Hi, good morning, Albert and Everett and Joseph.

Good morning.

Hi, Harvey.

How you doing, guys?

Good.

I know we're going through some tough times in the world economy, and you guys have held together pretty well, I think, and you're running the business I think quite well.

Just wondering, Albert, in your initial predictions at the beginning of the year, you were looking for a possible dividend increase of 8 to 10%.

Is that still in the cards?

Dividend increase -- I would say that our goal is to do that on an annual basis.

Right.

I think that we're going to defer that.

We'll see what the Board has to say at our last meeting.

At the present time, since we will probably not achieve last year's figures, we in all likelihood will not make an increase; but we'll see what happens as the year proceeds.

And Albert, with the cash position moving up from the 17, 18 million level to the 22 million level, and your comment on the fact that you would be looking for accretive acquisitions, would it be in one of the three areas you already pursue, or would you look at a fourth direction -- even though it would be a fourth direction, would be tied together to your other three types of businesses?

Well, the truth of the matter is that we want to stay as closely connected to the businesses that we understand so well, Harvey, and so it's unlikely that we would go into a fourth category.

I think that one of the three major groups is what we're looking at.

So it would be one of the test and measurement or the quick label or the grass?

Yes.

Right.

And do we still have a curiosity -- I will put as the word -- for possibly gaining a -- which is the opposite of acquisition -- a possible -- if the right offer came along in the grass technology situation?

You mean divestiture?

Yes.

In other words, would there be an interesting enough number -- with that division pretty much growing nicely, would there be enough growth in that to command a significant price that would get the Company pretty much a ton of money, which would make acquisitions in the remaining two phases -- both the T&M and the quick label system -- have the opportunity to really get some significant purchase of an additional kind of acquisition?

Well, you know, Harvey, I think that we have enough cash on hand and the ability to acquire more money to make the kind of acquisitions that we're interested in.

I would hate to name a figure that I would think would justify the divestiture, because it would really be a very big ton of money -- you used the word ton of money.

Right.

But we are not really even faintly interested in divesting any of our businesses.

But obviously, if somebody came along and said give you 75 to $100 million for the grass technologies, would that be a number that would tweak your interest?

Be US dollars you're talking about?

Yes, US dollars.

Well, I would invite anybody who wants to do that to test me.

I better not offer it, then.

Well, I congratulate you guys for running a tight ship in a tough market.

I look to speak to you again, Albert, in the near future.

I look forward to it, Harvey.

Thank you very much.

All right, all the best to you guys.

Thank you very much.

Thanks, guys.

Thank you.

And or next question is from the line of Joe First with First & Associates.

Please go ahead.

Good morning, gentlemen.

How are you today?

Fine, nice to talk to you, Joe.

Thank you.

And again, I commend you on doing a reasonable job in a tough environment.

And I have just a couple of questions -- and one comment and then the questions.

One of the things that I'm really disappointed in is your stock price is like 561 right now.

I mean, it's way under book value.

You have over $3 here in cash.

So people are evaluating this Company, and they're paying $2 something for the value of the Company; and I just do not understand it, and I would highly encourage you to buy back stock at these levels, and maybe even make a tender offer for a certain amount of stock, because -- and you know the math -- any stock you buy under book value adds to the book value to the Company and increases earnings per share and so on.

And you're certainly not getting much on cash levels these dayses.

I would think you have plenty of money to make a reasonable acquisition and buy stock back also --

Agreed.

-- so I would highly encourage you to do that.

Yes, and we have the authority, as you know, to buy a substantial amount; and we're going to -- when we emerge from the blackout period, which will be for all practical purposes on Monday -- we're going to be looking carefully at the stock price, and we will probably be active in making some acquisition there.

We agree with you that the current price does not reflect the intrinsic current value, saying nothing of the value that will come as we roll out the plans that we've set forth to you this morning.

Thank you.

And I mean, another reason, it would help your shareholders, because your shareholders are sitting out here dying in this environment.

Agreed.

And you need to do something to support your shareholders who have been supporting you for so many years.

Agreed.

Absolutely.

And secondly, you've talked about acquisitions.

Well, you've talked about that before but nothing's ever happened.

Are you taking it a little more seriously now or do --

Yes.

Are you actively looking at things -- is there potentials in the near term?

Yes.

We think that the opportunities that are available to us as a result of the collapse of our economic sector are considerable.

We think the opportunities are very great, and we have really begun the process.

We've identified a handful of target companies and we've begun the process, and we hope to have some good results to be able to announce in the months ahead.

So we are dead serious about it.

Thank you.

I'm glad to see that.

And one other question, and I'll let somebody else take questions.

Can you extract a little bit -- talk a little bit more about the ruggedized printer business and these airlines?

I know it's been delayed because of delays in different plants.

But tell us more about when that's coming on and what that means.

Well, we -- we think that -- the first place, we have a lot of orders -- a lot of contracts.

We have a substantial amount of business that's in the offing.

And as I said in my earlier -- as a matter of fact, Everett has handed me while we were speaking a list of some of the contracts we have.

We have the Airbus A380 through a company called (Inaudible); we have the Boeing 787 flight deck printer.

We have the Boeing 787 cabin printer.

We have contracts with Panasonic for cabin printers for the 757, the 767, the 777, as well as the A380.

We have contracts with the DRS Technologies and -- for ethernet switches -- ruggedized ethernet switches for various military vehicles.

We have the Boeing C17 flight deck printer.

We have the Airbus A400M, which is a cockpit printer.

We have the Boeing C130 cabin printer.

We have the Lockheed Martin C130J; and there are a number of other pending contracts -- a half dozen other pending contracts.

So there's a lot of business in our book.

And it remains for some of these airplane contracts to get rolling.

As I said in my opening statements, we think that no later than the first or second quarter of the new year, we will begin to see some significant sales.

But it's good business.

We've made a substantial investment in engineers and in testing equipment, in qualifying testing equipment for conducting all kinds of qualifying -- qualification tests -- temperature, heat, vibration and so on.

And we're constantly being audited by the contractors.

As a matter of fact, I believe next week we will have some people in from Airbus, is that not right, Everett?

Yes, we have some people in actually today.

And next week we'll have another people in.

So virtually a week doesn't go by when we don't have some kind of an auditor here.

And obviously, these audits are all very favorable on our behalf.

And these audits are not financial audits.

They are audits of our facility and our methodology and our testing equipment and so on.

So we have a lot of business, and I believe that a lot more will be coming our way as a result of the outstanding performance that we are conducting with our current contracts.

Sorry for the long-winded answer.

That's all right.

That's fine.

But we are very confident about the future for our ruggedized products.

And one more quick question.

In the test and measurement, I think you announced a call or two ago about being the preferred provider for a certain machine and that area that there were a whole bunch of centers that could possibly buy these things and apparently they buy one of the products every two or three years, is that where some of this increased sales is coming from?

You may be referring to some of our non-ruggedized test and measurement instrumentation area.

That would be probably one of our Dash products, probably the Dash 18, but it could also be the Dash 8.

Possibly it was the Everest Telemetry Recording system, which is in every telemetry center where testing of -- and launching of satellites and airplanes are conducted from.

I'm sorry I can't be a little more --

Well, I thought you were referring to something in the medical area.

Yes, I think --

Oh, the medical area.

Yes, you were referring to the grass contracts we have.

We have a contract with Premier which is a group purchasing organization.

That's it.

That is certainly help us to get more business, especially in the Sleep area, in the area of Sleep.

Because there are 1500 hospitals or so in that group?

Yes, right.

There are a lot of hospitals in that group.

And we have -- it's -- you know, they're not obligated to buy off that contract, but it really gives us a head start over other people and it is at a competitive price.

So it enables them to buy from us quickly, because they already have an established competitive price.

And as a matter of fact, that was Premier.

We're right now in negotiations with another big GPO, a group called [Broad Lane], and it's also a very good group and we hope to hear something on that within the next month or two.

Good.

Good.

Well, thank you.

(OPERATOR INSTRUCTIONS) .

Our next question is from the line of Ronald Cohen, private investor.

Please go

Hi, Everett.

Hi, Joseph.

Hi, Albert.

This is Ron Cohen.

How you guys doing?

Well, this is a first for you, Ron -- happy to have your question.

Okay.

I've been associated the Astro-Med for over 20 years and a shareholder for over 10 years.

At this time, I feel that I have to say something because I feel that a great Company such as Astro-Med should be performing better on the stock market, even in these challenging times.

The Company is performing well, making a profit and paying dividends.

However, there's a constant lack of volume; and without substantial increased volume, the stock will never go anywhere.

That's my opinion, by the way.

The stockholders suffer as a result of this, and nobody seems to be doing anything about it.

Internet conferences are nice -- conference calls, so forth; but it is basically the same group of people who participate every time.

I believe that Investor Relations specialists should be deployed as soon as possible.

I just think that Astro-Med's not doing enough to enhance shareholder value.

Well, appreciate your comment, Ron, and I agree with you that the price is lower than it should be and we don't get the recognition that we should, despite our serious efforts to put the spotlight on our Company.

But I am quite confident that with continued good results and appearances at various conferences -- and we're going to be appearing in a conference in less than a month in New York, and there will be others as well -- we'll get the attention that I think we deserve.

Okay.

Great.

Because I think you guys do an outstanding job there, and I respect all of you there and hopefully we can get something going.

We're with you.

Okay.

Thank you so much.

Good job in these challenging markets.

Thank you, Ron.

All right, bye-bye.

Thank you.

Our next question comes from the line of Gary Siperstein with Eliot Rose Asset Management.

Please go ahead.

Hey, guys, good morning.

Good morning, Gary.

Good morning, Gary.

Congratulations on a solid quarter in a tough time.

I think everyone's right on with that commentary.

But Al, I want to take a step back -- and following the last -- the lines of the last two questioners, you know, if we look at the situation, you know, from a couple hundred thousand feet up in the air, you know, the stock's lower now than it was five years ago, adjusted for stock dividends and splits.

Granted, it's a bare market, recessionary time.

But there's been no real return to shareholders.

And in terms of valuation, as Joe mentioned a couple of questions ago, with the $45 million market cap and $22 million in cash, that leaves $23 million enterprise value.

Arguably, your multiple acres and 100, 200,000 facilities -- which are owned and were purchased over a decade ago, if not 15 or 20 years ago -- is worth another 8 to $10 million.

So that gets you to a valuation of probably, you know, maybe $12 million -- 12 or $13 million, x'ing out cash and real estate.

So that's like a buck a share -- buck and-a-half a share -- enterprise value for the business that's generating 40 -- as you said, 45 to $0.50 in a recessionary time.

So the valuation is just ridiculous.

We know about the historical inability to get any research on the Company, because we're a micro cap.

We've talked about the fact that for a small Company, we have a CEO, a President, two positions when companies our size typically have one -- so the double salaries; the entrenched Board, which has been conservative -- and there's nothing wrong with that -- but one wonders maybe too conservative.

And I've argued before on these calls that instead of making acquisitions with all the risk -- and we know about the risk after we bought grass -- it took many, many years to fix it, with your stock so cheap you couldn't make an acquisition as cheap as your own stock.

I don't think you'll find anything out there that has an enterprise value of about 15% of sales and three times earnings.

You know, so I think you've got to be much, much more aggressive.

You've had the buyback in place.

You've bought it opportunistically.

But I think you've got to be much more aggressive on the buyback, and maybe a Dutch tender comes into play.

Secondly, I think you need to seriously consider increasing the cash dividend.

I mean, I was surprised at your hesitancy there.

Granted, it's a recession; but these are things you can do that aren't going to jeopardize the Company which will create some support for your shareholders and give them some return on the money.

I've talked in the past about a special dividend.

And then finally, selling the Company.

I mean, you know, it's been many, many, many years; and as you've heard on the call, there's a lot of frustrated shareholders.

Company's never gone from like, you know, 5 to w5 and down to 15 in a bare market and then the next bull market to 40.

The stock has been between 5-12 for probably a decade.

So I think it's time the Company looked to do something moraled and principled and fiduciary for your shareholders.

It's not about keeping Al Ondis in his eighties employed as CEO, and just hoping and hoping after 20 years.

Isn't it time you did something for us?

Well, I appreciate your comments and we'll certainly take them all under advisement.

Thank you.

Thank you.

Our next question is a follow-up from the line of Joe First with First & Associates.

Please go ahead.

Wanted to second what Gary Siperstein just said to you.

I agree with that 100%.

One of the problems in your stock price and getting people to buy has been the seeming lack of a succession plan.

People are concerned because of the ages of all of you.

Have you done anything to address that?

Well, as we have said a couple times, we have a good group of executives in the Company one notch or so below us that we're continuing to counsel and guide and watch them progress.

And we believe that when the time comes for us to step aside -- and I really think that the test of stepping aside is not based on age, but I think it's based on ability and performance, and I'll take a moment to blow the horns of the three of us who are sitting here around the table.

I think we're doing a pretty good job.

And I don't think that any of us is quite ready to hang it up.

And I don't think that it's -- the time has not come yet for us to hang it up.

But there are some very good people coming along within the Company, and we expect to see those people proceed until finally they overtake us and we'll grace fully step aside.

Okay, thank you.

I'm not urging you to step aside.

That's not the point.

I think you've done a good job and you've been very conservative -- and as Gary said, maybe a little bit too conservative.

But it's time for some aggressive action, especially with buying back stock.

It would be best for the Company and the shareholders and everyone involved.

Thank you, Joe.

I show no further questions at this time.

Please continue.

Well, if there are no more questions, I think we'll just say thank you all for participating, and our next conference call will take place at the time of our annual meeting, which will be toward the latter part of March.

We'll announce the date later on.

Thank you once again for participating, and feel free to call us or write to us at any time.

We're always glad to hear your comments and we get your suggestions, and so have a good holiday season and a good, Happy New Year.

Ladies and gentlemen, this concludes the Astro-Med, Inc., third quarter fiscal 2009 earnings conference call.

You may now disconnect.

And thank you for uses ATT Conferencing.