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Supreme Industries Inc. (NYSEMKT:STS)

Q3 2008 Earnings Call Transcript

November 11, 2008, 4:30 pm ET

Executives

Robert Wilson – President and COO

Jeffery Mowery – Treasurer, CFO and Assistant Secretary

Tom Beard – VP of Operations

Mark Beer – VP of Sales

Analysts

Jamie Wilen – Wilen Management

Scott Lewis – Lewis Capital Management

Tom Spiro – Spiro Capital Management

Ralph Marash – First Manhattan

Bruce Oliphant [ph] – Oppenheimer

Operator

Welcome everybody to the Supreme Industries third quarter and nine months 2008 conference call. Before we begin let me remind you that some statements made on today’s call will be predictive and are intended to be made as forward-looking within the Safe Harbor protection and Private Securities Litigation Reform Act of 1995. Although the company believes that its forward-looking statements are based on reasonable assumptions, such statements are subject to risk and uncertainties that could cause results to differ materially.

Important factors that can cause actual results to differ materially from those in the forward-looking statements are set forth in the company’s report from Form 10-K and 10-Q and news releases filed with the Securities and Exchange Commission. All reports and news released are available on Supreme’s website at www.supreme.com. Today’s conference call is being broadcast live from Supreme’s website. At the conclusion of the call it will be archived and available for replay for 30 days.

At this time I’d like to introduce your hose for today’s call Supreme Industries President and Chief Operating Officer, Mr. Robert Wilson; please go ahead Mr. Wilson.

Robert Wilson

Thank you, Sean. Good afternoon. Thank you for joining us for today’s conference call to discuss Supreme’s third quarter and nine months 2008 financial results. Our press release was issued earlier today. If you would like a copy, please visit the company’s website or call Supreme’s Investor Relations department at 574-228-4130 and a copy will be forwarded to you.

Joining me on today’s call are Jeffery Mowery, Supreme’s Chief Financial Officer; Tom Beard, our Vice President of Operations and Mark Beer, our Vice President of Sales. We will begin with a broad overview, followed by a financial review for both periods; a brief product review and finish with a few closing remarks, after which we will open up the call for any questions that you may have.

As most of you well know, we are in approximately the seventh quarter of a persistent downtrend in the retail truck industry and recent economic uncertainty and unusually tight credit are making it difficult to predict when the market will turn. Nowhere has the impact of the current conditions has been felt more keenly for Supreme, than in our largest product category, the core dry-freight truck body product line.

For both the quarterly and year-to-day periods versus 2007, revenues were down about 20% for this segment. Further exacerbating the general industry downturn where chassis availability disruptions going into the years first half which have hence been resolved. Partially offsetting the revenue weakness in this and other product categories however was the strong performance of robust division which reported revenue increases of 34% and 22% respectively for the three and nine month periods, reinforcing our long standing policy of product diversification.

In a chance of facing of a difficult economic environment, we have been proactive in doing what needs to be done, to weather this downturn and position the company for an upward cycle. Execution of a modified strategy has and continues to be focused on right sizing the business to align with current conditions which are widely anticipated to persist well into 2009, and redoubling our ongoing efforts to indenting and take costs out of the business.

Accordingly, beginning in the third quarter we implemented annualized cost reductions totaling $6.5 million and have identified additional cost reductions of $1.5 million which will be implemented by year end. We continue to keep a close eye on managing our expenses and overhead cost structure and are prepared to make additional realignments as necessary. Adding to this our long standing policy of aggressively managing our working capital has resulted in the strong balance sheet which we believe is a competitive advantage in the current environment.

Meanwhile we continue to invest appropriately for both the short and long term and are pleased to report that our new products are being well received in the market place. We are particularly excited about the response to our new Signature Van Body. We began the planning phase or redesigning our core Van Body in the summer of 2007.

As the economy began to slow, we reassessed and considered suspending the entire project, because of the cost of the significant internal resources dedicated to the developmental phase and because of the significant training and marketing cost necessary for a successful product lounge. However we believe so strongly in the benefits of our projects that our management team decided to maintain our momentum by continuing the project and now we are entering into the production phase in November.

Our financial results include significant internal and external project cost incurred throughout 2008. However, we believe we had created meaningful differences between our core product and that of our competition and we consider these project investments central to our future growth and success as we are committed to being the most customer-focused, solution driven company in the specialized vehicle industry.

Now, turning to our financial results. Consolidated 2008 net sales were $61.1 million for the third quarter and $212.3 million for the nine months. This compares with $67.5 million and $239.6 million in the respective periods last year. Gross profit as a percentage of sales was 8.9% for the quarter and 9.6% for the nine months and primarily reflected pricing pressures in the marketplace and less overhead absorption due to the lower sales volumes. Gross profit for the respective periods of 2007 was 10.9% and 11.4%.

Selling, general and administrative expenses increased 3.4% to $6.8 million for the third quarter and decreased 1.5% to $20.8 million for the nine months versus last year’s comparable periods. Our selling expenses increased during the third quarter due to receiving fewer co-op marketing credits from chassis manufacturers and incurring higher training and marketing expenses associated with the launch of our new Signature Van Body product.

Interest expense was flat for the quarter and declined for the nine months as a result of lower interest rates and less working capital requirements related to the decreased sales volume.

For the 2008 third quarter, Supreme reported the net loss of $630,000 or $0.04 per share compared with net income of $274,000 or $0.02 per share in the same period of last year. For the nine months, the company reported a loss of $0.01 per share, compared with earnings of $0.24 per share in 2007.

Stockholder’s equity was $73.3 million or $5.52 per share at September 27, 2008, compared with $75.5 million or $5.73 per share at year-end 2007. Working capital totaled $56.9 million in the current period compared with $58.5 million at the end of last year. The working capital ratio at third quarter end was 4.1:1, up from 3.3:1 reported at the end of 2007. Backlog of $64.9 million at September 27, 2008 compares with $72.6 million at the end of last year’s third quarter.

Turning to our product review, as mentioned earlier our new Signature Van Body is being received enthusiastically. The new Van Body design takes advantage of product standardization to increase the efficiency for custom build and reduced lead-times from orders to delivery, which should help us to be more competitive in the current market. Production has begun and we expect to begin realizing benefits early in 2009.

In our specialty vehicle division, we continue our efforts to capitalize on incremental market opportunities derived from existing products. Those shipments of armored Suburbans for our Department of State contract have been delayed by the slow receipt of chassis. We have received final inspection and approval and we’ll commence deliveries in the current quarter.

The DLS is very pleased with the quality of the finished product and has been very complimentary of the cooperation and thoroughness of our Texas operations. In response to the current customer demand for both our bus products, we are in the process of redistributing capacity at the company’s Indiana, Pennsylvania and Michigan manufacturing facilities to increase bus production.

Additionally, we will begin building buses that our Oregon facility to meet existing and incremental West Coast bus product demands. Higher sales in this product category reflect consumer sensitivity to the fluctuating fuel prices, which has intensified the usage of public transportations.

Yesterday, the Board of Directors declared a 6% stock dividend for common share. They said, it’s an increase from last quarter’s 2% stock dividend as the Board took into account the recent decline in the market value of our Class A common stock. It is the Board’s intension, to maintain stock dividends in lieu of cash dividends until the business outlook improves.

We believe we’ve at a minimum maintained market share for our products year-to-date. We will continue to focus on product diversification as well as executing our modified strategic plan and believe that the company will emerge from this downturn stronger than ever.

With that, we conclude our formal remarks and we’ll open up the call for your questions. Operator.

Question-and-Answer Session

Operator

(Operator instructions) Your first question comes from Jamie Wilen of Wilen Management.

Jamie Wilen – Wilen Management

I just want to ask a few questions, staring with the bus division. You mention that it’s so strong, are you gaining market share or is it just the whole industry is just going crazy and can you talk about margins on bus versus rest of the company?

Robert Wilson

I had reviewed that issue with our Vice President of Sales for the bus division prior to the call Jamie. The bus industry is strong, but it is feeling that we are gaining market share. It’s hard to quantify, because there’s not good statistics out there to develop a real sound market share percentage, but based on what we can sell from the industry, we probably are gaining maybe not significant market share, but we are picking up some.

The margins on the bus side of the business have never been quite as strong as what they are on the truck side. I don’t want to disclose percentages, but margins in the bus side of the business have maintained where they’ve been historically as the business has grown. The truck side, obviously in this environment with the top-line challenges and material cost challenges are not what we would like them to be at this point.

Jamie Wilen – Wilen Management

Okay and on the bus side are there big orders that are coming, are we bidding on big municipal contracts or they are just making relation of things and what is our current backlog in bus versus a year ago?

Robert Wilson

Overall, we’re doing both Jamie. I got Tom Beard, who is our Vice President of Manufacturing, who moved over to the Vice President of Manufacturing for the whole company coming from the bus division. So, he is still fairly intimately involved with that part of the business and I will let him address that question.

Tom Beard

The real issue, the real answer is, we’ve gotten several fairly large kinds of specialty bus orders in the last several months that actually will take some of our facilities out for two years and we have the retail business. The question on the backlog is if the backlog is down a little bit from last year at the same time, but not significantly.

Jamie Wilen – Wilen Management

Normally about our buses were kind of more bantam buses; how large of these?

Tom Beard

Some of the bigger orders that we’re receiving are still again 16 to 20 passengers. They are transit buses. We do produce up to 39 passengers and the business is fairly strong in that and we are getting a decent number of high rate buses too right now.

Jamie Wilen – Wilen Management

And again why are we picking up share; are we pricing it too inexpensively or why not? Why yes?

Tom Beard

Actually on some of the last several large bids, we got the buses fairly specialized and in one particular base we were the only better.

Robert Wilson

And we have maintained our margin as the business as grown.

Jamie Wilen – Wilen Management

For the only bidder we certainly should?

Robert Wilson

They are all not like that though Jamie.

Jamie Wilen – Wilen Management

On the army side and the military side, the military contract we are about to start producing on it. Could you talk about volumes have been and what they will be on that side?

Robert Wilson

We have spent a considerable amount of time FERO typing the five department of states of Bourbon models that we received the order for. We have just gotten approval on all five models and are moving into production now Jamie and we’ll start making deliveries here very shortly. I think we have made some of the first deliveries within the last couple of weeks.

We hope eventually, to work up to about 20 units a month, but that’s going to take some time to ramp up. That’s a fairly complex process and with five different models going down to line and are doing fairly labor intensive, it will take us a some month or two to get up to the whole objective of 20 a month.

Jamie Wilen – Wilen Management

So in 2009, on this contract, approximately how much do you think you could deliver?

Robert Wilson

Amazingly it comes right out to what the contract was for, somewhere between $19 million and $20 million once the production ramps up to full capacity.

Jamie Wilen – Wilen Management

And this a $100 million five year contract?

Robert Wilson

That is correct.

Jamie Wilen – Wilen Management

When I look, at the 10-Q inventory wise, not so much in finish goods, but at time in raw materials, is that because of the bus contracts?

Robert Wilson

It’s probably a combination of items. It would be the bus contracts, the small Silver Crown division carries the motor homes chassis, the Texas armored inventory is up slightly and then we also have a couple of million dollars of inventory that did not get used in last years fleet run. That we will have the opportunity to use in this years fleet runs.

Jamie Wilen – Wilen Management

And as you look at the fleet runs any indications for what 2009 will bring?

Robert Wilson

I have Mark Beer, our Vice President of Sales here and I will let him address that.

Mark Beer

On the fleet side of business we were able to secure a sizable work and key roughly through this year. Other fleet that we’ve normally have done business with have not been so productive, but it has to do with the downsize in their businesses, but the 10Q one is the noted one that it has been secured.

Jamie Wilen – Wilen Management

And we have maintained our market share there.

Mark Beer

I would say so, yes business is down.

Jamie Wilen – Wilen Management

Okay, I’ll let someone else go for a little bit.

Operator

Your next question comes from Scott Lewis from Lewis Capital Management.

Scott Lewis – Lewis Capital Management

Thank you. Good Afternoon. Bob, just a couple a questions; are you seeing any benefit on the cost of materials side like steel and aluminum?

Robert Wilson

We had significant unfavorable purchase price variances on steel and steel related items through the third quarter and it was significant. As we move in to the fourth quarter, we are starting to see some softness in some of the raw materials we’re purchasing and we anticipate that steel will be one another one that will get relief on.

Scott Lewis – Lewis Capital Management

And your think you’ll be able to kind of use that your margin benefit or is the pricing going to just move down or anything to reflect that in the industry?

Robert Wilson

As I know we have our competitors listening and we also have customers that listen on to this call and I guess I would say that we absorb those cost increases not to our benefit. They worked against this, so as they come down we’re hopping, we will just get back to an acceptable margin. I don’t see any benefit from increasing margins. We will get back to where we should be.

Scott Lewis – Lewis Capital Management

Okay and then in the last call you talked a little bit about interest in the armored SUV from other governmental agencies, is that anything coming to fruition our maybe next coming the fruition there?

Robert Wilson

I would think that would be next year. I mean there is still as some interest as the department of state inspectors which visit our facilities on a weekly basis to inspect the vehicles that we’re producing, have indicated that the other agencies based on the quality of our vehicle are interested going forward, but its actually seeing through. In order yet we have not.

Scott Lewis – Lewis Capital Management

And then last question I know before the 2007 emission standard, you sort of saw a lot of pre-buy, do you think you might see that in ’09 for the 2010 or do you think it might be different this time?

Robert Wilson

I will address what I’ve read and everything I have read Scott indicates, there will not be a significant pre-buy. Now Mark, our Vice President of Sales may have a different opinion; have you heard anything?

Mark Beer

I think there is two (inaudible) but there might be a similar amount to what it was in ’06, but the anticipated amount in ’06 never reached the level that they got it would, so I think that probably what amount there is it will not be as significant nature.

Scott Lewis – Lewis Capital Management

Great, thank you very much guys.

Operator

Your next question comes from the line of Tom Spiro from Spiro Capital Management.

Tom Spiro – Spiro Capital Management

I’m Spiro, Spiro capital, good afternoon. A couple of questions, first on the bus division the underlying sources of debt demand there as I recall our municipality generally and then the hospitality industry. Focusing on municipalities governments first lots of them were running out of money and I was curious, whether you seen any of your customers begin to pullback or you concerned about that?

Robert Wilson

We have not noticed anybody pulling back Tom. In some of the contracts we’ve been awarded for the future, so I don’t see that. Tom have you heard any.

Tom Beard

There’s been a couple of instances, where Asian keys have used some of their budget for fuel and so some of the purchases were reduced that might have been in order for 24 that was reduced 18, but there is a decent number of our contracts that are in placed that are multi-year and we may be in the second or third year and they have not changed the cost.

Tom Spiro – Spiro Capital

And the same issue with respect to the hospitality industry, shorter you fund is that pullback of any of that?

Tom Beard

I mean realistically (inaudible) on the retail side of the business. We haven’t really seen much of that go back, no.

Tom Spiro – Spiro Capital

Okay and secondly the cost savings, the press release mentioned $6.5 million to first and then an additional of $1.5 million for a total of $8 million, where it’s going to come from, is it in the gross margin line, is it SG&A, how will you achieved that?

Robert Wilson

It’s going to be in all of those areas. Tom it’s going to be in the gross margin line. We have significantly reduce direct labor because of the economic environment we are in. We are looking at shutting down some distribution facilities that will save and quite honestly with the revenues that were not adjoined, we’re taking a look at the SG&A line and have made moves there already and our employees listen to this call also. So, I don’t want to say too much, but we want to manage the business to fit the revenue we are going to have and quite obviously the revenue is down.

Tom Spiro – Spiro Capital

Yes, yes, makes sense and lastly, I believe you have negotiated a new credit agreement or you are in the process of negotiating a new credit agreement and I was curious, what are the material differences between the new one and the old one?

Robert Wilson

That sounds like a question for the Vice President and CFO.

Jeffery Mowery

Well obviously, Tom you are aware of the credit crisis this country done and it’s having an impact on our pricing, but in terms of covenants, we’ve got some relief on our existing covenants and the bank is willing to work with us because of our strong balance sheet and so, really at this point we don’t really know what the new agreements that are look like. We are kind of waiting to see what our ’09 forecast looks like and then we will go from there.

Tom Spiro – Spiro Capital

Well what’s the tightest covenant that you are working under today?

Jeffery Mowery

Well, really we only have one covenant at this point and its balance sheet related, it’s the minimum tangible net worth covenant.

Tom Spiro – Spiro Capital

What’s the requirement and what’s the number we are at today?

Jeffery Mowery

It’s a $68 million requirement and we are at north of $73 million currently.

Tom Spiro – Spiro Capital

And you mentioned the pricing is changing; can you give us some sense of how much?

Jeffery Mowery

It’s probably gone up 20% to 30%. It’s a pricing made for it’s, which I don’t believe Jeff as with it Tom.

Tom Spiro – Spiro Capital

In terms of basis points for given level of EBITDA, or debt, or what have you I mean you are talking about like 25 basis points, 50, 75?

Jeffery Mowery

It probably would be north of 75.

Tom Spiro – Spiro Capital

Okay, many thanks.

Operator

Your next question comes from Ralph Marash from First Manhattan. Your line is open.

Ralph Marash – First Manhattan

What’s your current all in interest cost, on a percentage basis actually, their interest rate?

Jeffery Mowery

We are around at 6.5% to 7% right now all in.

Ralph Marash – First Manhattan

So, just conceivably it could go up to 7% on a quarter to 7.5% something like that?

Jeffery Mowery

Depending on our performance, yes.

Ralph Marash – First Manhattan

On the cash flow statement in the Q, you’ve lump together changes in operating assets and liabilities and there is a big, big difference this year to last year. Can you just spend a minute or two giving us some color on that?

Jeffery Mowery

I think last year there was a reduction of inventories and things that leveled off. So, I think that’s the biggest difference between the two periods.

Ralph Marash – First Manhattan

I think you also in the explanation in the Q, you mentioned the receivables changes as well, is that included in there?

Robert Wilson

Yes that is included in there, our receivable, since looking at the balance sheet, we show year-end and also for the end of the quarter. So, our receivables have gone down about $8.5 million, partly due to better collections and also because of the drop in sale volume. The day sales outstanding are still, Ralph, it’s still around 30 Jeff?

Jeffery Mowery

Yes.

Ralph Marash – First Manhattan

Okay and roughly regarding the Penske contract roughly, how far through that in terms of a percent of the contract, which you say you are now?

Robert Wilson

That will not begin until March of ’09 and those two in June.

Ralph Marash – First Manhattan

March to June of ’09?

Robert Wilson

Yes.

Ralph Marash – First Manhattan

Okay and one of the other large fleet buyers last week indicative that they have transferred a severely a restricted orders next year I believe. Would you just comment on your take on that and whether you think, you will see any orders out of them next year?

Robert Wilson

I believe you’re probably referring to budget?

Ralph Marash – First Manhattan

Yes.

Robert Wilson

Yes and one news; I’m hearing most recently, I don’t think they’re on a track right now reconsidering any purchase.

Ralph Marash – First Manhattan

That basically for the next 12-months, you’re just saying?

Robert Wilson

Yes. I wouldn’t speculate any further on that. They have given that no indication that they have changed their purchasing plan for ’09.

Ralph Marash – First Manhattan

Okay. In terms of chassis availability and any further issues there. I assume that GM thing has really washed through, but with any other manufacturers, any other issues?

Robert Wilson

Currently, we have chassis available to this, Ralph. Looking forward based on the state of economy and the companies participating in it, it’s hard to predict whether we’ll have issues going forward or not. We intend to maintain good relationships with all major manufacturers to hope to avoid any issues if anybody does have a problem.

Ralph Marash – First Manhattan

With the domestic manufacturers obviously and great turmoil, do you see any foreign chassis coming in; is that a possibility?

Robert Wilson

I think the only OEM that we see as making some head way into this market and growing it would be Sprinter. They of course are provider of chassis that can work with the light-duty type vehicles somewhat to GM, Ford, but at this point, we see no indication that they will be able step up to the volumes and what with other companies do with it, but at this point that’s the only one I can see.

Ralph Marash – First Manhattan

Is there anymore of a steady slow. I mean I’m also thinking of Japanese and I guess, Idaho and so on from a manual differentiation there, but in so called normal times, if they exist, is there a flow of chassis for asdic or is it fairly steady?

Robert Wilson

It seems to be in the largest of the OEM to bring chassis in the country, their numbers have been down in ’08, even some in term of ’07, but ’08 definitely. They’ve reduced numbers into the State, but I don’t know if that’s going to be seen as a drastic reduction in ’09. They just kind of downsized or right-sized their business with the economy I believe.

Ralph Marash – First Manhattan

That’s Isuzu separate from the GM branded chassis, right.

Robert Wilson

Yes

Ralph Marash – First Manhattan

Thanks very much.

Operator

Your next question comes from Jamie Wilen from Wilen Management. Your line is open.

Jamie Wilen – Wilen Management

Bob, just a follow-up; on the cost reductions, how much is it in the labor force that you’re reducing and where is this all coming from?

Robert Wilson

A large percentage of it has been labor-related and along with the benefits that go along with that. One of my associates, she already had a schedule prepared on that Jamie. So, roughly wages of the total we’re talking about is 68%, because there is another 9% in benefit. Materials is about 8% and then we’ve had some reductions and some certain insurance costs which is approximately 7% and then closing of distribution facilities is in the 5% to 6% range.

Jamie Wilen – Wilen Management

Within the labor reduction, is there any severance that we have to payout in the fourth quarter?

Robert Wilson

There is not. Let me correct that Jamie, if there is any it would be very in significant in amount

Jamie Wilen – Wilen Management

And last few things; competitive wise obviously was a difficult time, have you seen anybody go out of business at this point?

Robert Wilson

There are rumors about a lot of those smaller players. We saw one small manufacturer here in Elkhart County that did close the doors and we believe consolidated with another company, but beyond that I don’t know. From being associated with the industry and talking suppliers and even to some of our competitors like everyone in the industry there are several people that are struggling.

Jamie Wilen – Wilen Management

And lastly with the bus orders and cost reductions, is there any shot that we can be in the back end of fourth quarter is that going to have waited until 2009?

Robert Wilson

That would be a forecast Jamie and I would say there is a possibility, but it would be tough because, it’s a tough quarter in terms of – I think most of our holidays fall in that quarter, and we have gotten some shorten work week. So, I anticipate from my personal view that a tough fourth quarter, the early part in next year will be tough, but then I see based on the operational improvements we have made and decisional overhead absorption that we’ll get from the bus side that I see next year being much better, I see us being able to make money at much lower revenue levels.

Jamie Wilen – Wilen Management

And obviously we have cutback on CapEx in the rest of this year and next year to keep everything intact?

Robert Wilson

We have cutback. We are just spending on what’s essential to the operations of the company or enhancing the top line.

Jamie Wilen – Wilen Management

And obviously much less than depreciation at this point?

Robert Wilson

Right

Jamie Wilen – Wilen Management

Okay, great thanks Bob.

Operator

Your next question comes from Bruce Oliphant [ph] from Oppenheimer

Bruce Oliphant – Oppenheimer

Bob I’ve been a very long-term shareholder myself and my clients in Supreme Industries and even when we had some very good year’s and what we are paying the dividend which is high yield at that time, the stock really never got any proper valuation. In fact to go back in history we really never traded that much above book value, and here we are today where the stock is now selling at 22% of book value and I was just wondering have you guys ever consider going private.

Robert Wilson

First of all Supreme stock is my largest investment. So, my intent is to work hard to get it up to a fair valuation. The board probably has talked about going private, but we have never seriously considered it and we have not had a recent board meeting so the subject has not come up.

Bruce Oliphant – Oppenheimer

And at these levels I just kind of surprised, you’re talking about $1.20 that hasn’t been any real insider buying at all. I mean I think the last time there was insider buying on the stock they have to be probably in the 6 or 7 range, is that correct.

Robert Wilson

Insiders are in black out period, where we are not permitted to buy until one day after the release of earnings.

Bruce Oliphant – Oppenheimer

And my other question is that could we run into a possible delisting problem on the AMEX and not up with the AMEX rules as far as pricing does?

Robert Wilson

I’ve seen some articles on some of the companies that are in trouble at this point in time and, the AMEX was bought by the New York stock exchange. I do not believe, we are in any delisting thing issue at this point.

Bruce Oliphant – Oppenheimer

And my last questions is, looking out to ’09, I don’t think it will be a hard question to answer, do you at least see us in’09 having a profitable year?

Robert Wilson

I think I was talk to Jamie or maybe it was Tom about the cost structure in our company where we have taken out significant cost going forward and I see us being profitable on a much lower revenue base next year. I also see the additional bus production out of the existing facilities that we already have permitting us to absorb additional overhead. So, personally I am optimistic about next year.

Bruce Oliphant – Oppenheimer

And my last question is, are you going to be doing anything as far as on the investor relations forefront. It just seems like I said I’ve been in the stock for years and I can’t remember the last time I saw any research coverage at all on Supreme Industries?

Robert Wilson

Being a small comp stock and not needing investment banking or needing to raise funds it’s awfully difficult to get some under borrow you.

Bruce Oliphant – Oppenheimer

Well I guess some other questions and I’m hoping as a shareholder I could see a vote of confidence, with maybe in the upcoming days or weeks management going to their pockets and buying stock. I deserve that if management believes in the company and puts their money where the amounts are that says a lot to shareholders.

Robert Wilson

Well I can tell you, I believe in the company.

Bruce Oliphant – Oppenheimer

Alright. Buy some stock.

Robert Wilson

There is a credit crunch out there.

Operator

(Operator instructions) Your final question comes from Scott Lewis from Lewis Capital Management.

Scott Lewis – Lewis Capital Management

I missed the first few minutes of the call so I apologize if you address this, but talking about the credit environment, I know things got significantly worse in October and I was just wondering if that is impacting your business and so far as customers having issues being able to finance truck purchases, have you seen that at all in the last months or so.

Robert Wilson

It probably impacts our Silver Crown division more than any other division and they have had people that were ready to buy and just could not get the financing, but overall I don’t think it’s been a huge effect on our business.

Scott Lewis – Lewis Capital Management

Okay, super. Thanks

Operator

(Operator instructions) There are no more questions at this time. Do you have any closing remarks?

Robert Wilson

I sure do. Thank you, Chris. That concludes today’s conference call. I want to thank you for joining us and we look forward to speaking to you.

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