10-Q 1 jan200910q.txt 10Q FOR THE QUARTER ENDED JANUARY 31, 2009 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-QSB (Mark One) [ X ] QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EX- CHANGE ACT OF 1934 For the quarterly period ended January 31, 2009 [ ] TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EX- CHANGE ACT OF 1934 For the transition period from ___________ to ____________ Commission File Number: 000-05378 GEORGE RISK INDUSTRIES, INC. (Exact name of small business issuer as specified in its charter) Colorado 84-0524756 (State of incorporation) (IRS Employers Identification No.) 802 South Elm St. Kimball, NE 69145 (Address of principal executive offices) (Zip Code) (308) 235-4645 (Registrant's telephone number, including area code) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [ ] Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [ X ] APPLICABLE ONLY TO CORPORATE ISSUERS The number of shares of the Registrant's Common Stock outstanding, as of March 17, 2009 was 5,141,144. Transitional Small Business Disclosure Format: Yes [ X ] No [ ] GEORGE RISK INDUSTRIES, INC. PART I. FINANCIAL INFORMATION Item 1. Financial Statements The unaudited financial statements for the three and nine month period ended January 31, 2009, are attached hereto. GEORGE RISK INDUSTRIES, INC. BALANCE SHEETS
January 31, April 30, 2009 2008 ------------ ------------ (unaudited) ASSETS Current Assets Cash and cash equivalents $ 4,308,000 $ 4,072,000 Marketable securities (Note 2) 15,368,000 17,533,000 Accounts receivable: Trade, net of $50,000 doubtful account allowance 1,031,000 1,509,000 Other 2,000 1,000 Note receivable, current 3,000 3,000 Income tax overpayment 122,000 471,000 Inventories (Note 3) 3,072,000 3,100,000 Prepaid expenses 89,000 103,000 Deferred income taxes 1,383,000 250,000 ------------ ------------ Total Current Assets $25,378,000 $27,042,000 Property and Equipment, net at cost $ 765,000 $ 831,000 Other Assets Investment in Land Limited Partnership, at cost 200,000 200,000 Projects in process 131,000 68,000 Long-term receivable 60,000 60,000 Note receivable 10,000 12,000 Other 0 1,000 ------------ ------------ Total Other Assets $ 401,000 $ 341,000 TOTAL ASSETS $26,544,000 $28,214,000 ============ ============
GEORGE RISK INDUSTRIES, INC. BALANCE SHEETS
January 31, April 30, 2009 2008 ------------ ------------ (unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable, trade $ 84,000 $ 67,000 Dividends payable 317,000 239,000 Accrued expenses Payroll and other expenses 244,000 321,000 Property taxes 2,000 0 ------------ ------------ Total Current Liabilities $ 647,000 $ 627,000 Long-Term Liabilities Deferred income taxes 50,000 79,000 ------------ ------------ Total Long-Term Liabilities $ 50,000 $ 79,000 Stockholders' Equity Convertible preferred stock, 1,000,000 shares authorized, Series 1-noncumulative, $20 stated value, 25,000 shares authorized, 4,100 issued and outstanding 99,000 99,000 Common stock, Class A, $.10 par value, 10,000,000 shares authorized, 8,502,832 shares issued and outstanding 850,000 850,000 Additional paid-in capital 1,736,000 1,736,000 Accumulated other comprehensive income (1,390,000) (67,000) Retained earnings 27,475,000 27,788,000 Treasury stock, 3,333,798 and 3,326,551 shares, at cost (2,923,000) (2,898,000) ------------ ------------ Total Stockholders' Equity $25,847,000 $27,508,000 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $26,544,000 $28,214,000 ============ ============
GEORGE RISK INDUSTRIES, INC. INCOME STATEMENTS Three months Nine months Three months Nine months ended ended ended ended January 31, January 31, January 31, January 31, 2009 2009 2008 2008 --------------------------------------------------- Net Sales $ 1,825,000 $ 6,739,000 $ 2,572,000 $ 8,818,000 Less: cost of goods sold (1,086,000) (3,457,000) (1,396,000) (4,410,000) ------------ ------------ ------------ ------------ Gross Profit $ 739,000 $ 3,282,000 $ 1,176,000 $ 4,408,000 Operating Expenses: General and administrative 177,000 560,000 188,000 549,000 Selling 434,000 1,381,000 500,000 1,520,000 Engineering 22,000 61,000 19,000 64,000 Rent paid to related parties 12,000 39,000 12,000 40,000 ------------ ------------ ------------ ------------ Total Operating Expenses $ 645,000 $ 2,041,000 $ 719,000 $ 2,173,000 Income From Operations 94,000 1,241,000 457,000 2,235,000 Other Income (Expense) Other 6,000 9,000 (2,000) 1,000 Dividend and interest income 208,000 603,000 254,000 655,000 Gain (loss) on sale of investments (394,000) (938,000) (112,000) 34,000 Gain (loss) on sale of assets 0 0 0 15,000 ------------ ------------ ------------ ------------ $ (180,000) $ (326,000) $ 140,000 $ 705,000 Income Before Provisions for Income Tax (86,000) 915,000 597,000 2,940,000 Provisions for Income Tax Current Expense 217,000 557,000 324,000 1,048,000 Deferred tax expense (benefit) (132,000) (210,000) (54,000) (13,000) ------------ ------------ ------------ ------------ Total Income Tax Expense 85,000 347,000 270,000 1,035,000 Net Income $ (171,000) $ 568,000 $ 327,000 $ 1,905,000 ============ ============ ============ ============ Cash Dividends Common Stock ($0.17 per share) 0 (880,000) 0 (907,000) Income Per Share of Common Stock (Note 5): Basic and diluted $(0.03) $0.11 $0.06 $0.36 Weighted Average Number of Common Shares Outstanding: Basic 5,173,372 5,175,189 5,333,116 5,334,553 Diluted 5,193,872 5,195,689 5,353,616 5,355,053
GEORGE RISK INDUSTRIES, INC. STATEMENTS OF COMPREHENSIVE INCOME
Three months Nine months Three months Nine months ended ended ended ended January 31, January 31, January 31, January 31, 2009 2009 2008 2008 ---------------------------------------------------- Net Income $ (171,000) $ 568,000 $ 327,000 $ 1,905,000 ------------ ------------ ------------ ------------ Other Comprehensive Income, net of tax Unrealized gain (loss) on securities: Unrealized holding gains (losses) arising during period (466,000) (3,047,000) (650,000) (497,000) Reclassification adjustment for (gains) losses included in net income 380,000 772,000 73,000 (52,000) Income tax expense related to other comprehensive income 36,000 951,000 241,000 229,000 ------------ ------------ ------------ ------------ Other Comprehensive Income $ (50,000) $(1,324,000) $ (336,000) $ (320,000) Comprehensive Income $ (221,000) $ (756,000) $ (9,000) $ 1,585,000 ============ ============ ============ ============
GEORGE RISK INDUSTRIES, INC. STATEMENTS OF CASH FLOWS
Nine months Nine months ended ended January 31, January 31, 2009 2008 ---------------------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 568,000 $ 1,905,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 123,000 128,000 (Gain) loss on sale of investments 938,000 (34,000) (Gain) loss on sale of assets 0 (15,000) Deferred income taxes (210,000) (13,000) Changes in assets and liabilities: (Increase) decrease in: Accounts receivable 478,000 495,000 Inventories 28,000 3,000 Prepaid expenses 13,000 53,000 Other receivables (1,000) 3,000 Income tax overpayment 349,000 (150,000) Increase (decrease) in: Accounts payable 17,000 (52,000) Accrued expenses (75,000) (68,000) ------------ ------------ Net cash provided by (used in) operating activities $ 2,228,000 $ 2,255,000 CASH FLOWS FROM INVESTING ACTIVITIES: Other assets manufactured (63,000) 49,000 (Purchase) of property/equipment (56,000) (173,000) Proceeds from sale of marketable securities 98,000 3,542,000 (Purchase) of marketable securities (1,146,000) (4,784,000) Collections of loans to employees 3,000 1,000 Purchase of treasury stock (26,000) (32,000) ------------ ------------ Net cash provided by (used in) investing activities $(1,190,000) $(1,397,000) CASH FLOWS FROM FINANCING ACTIVITIES: Dividends paid (802,000) (829,000) ------------ ------------ Net cash provided by (used in) financing activities $ (802,000) $ (829,000) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS $ 236,000 $ 29,000 Cash and cash equivalents, beginning of period $ 4,072,000 $ 4,611,000 ------------ ------------ Cash and cash equivalents, end of period $ 4,308,000 $ 4,640,000 ============ ============ Supplemental Disclosure of Cash Flow Information Cash payments for: Income taxes $ 206,000 $ 1,134,000 Interest expense 0 6,000
GEORGE RISK INDUSTRIES, INC. NOTES TO FINANCIAL STATEMENTS JANUARY 31, 2009 Note 1 Unaudited Interim Financial Statements The accompanying financial statements have been prepared in accordance with the instructions for Form 10QSB and do not include all of the inform- ation and footnotes required by generally accepted accounting principals for complete financial statements. These financial statements should be read in conjunction with the financial statements and notes contained in the com- pany's annual report on Form 10KSB for the year ended April 30, 2008 with the SEC. In the opinion of management, all adjustments, consisting only of nor- mal recurring adjustments considered necessary for a fair presentation, have been included. Operating results for any quarter are not necessarily indic- ative of the results for any other quarter or for the full year. Note 2 Marketable Securities The Company has investments in publicly traded equity securities as well as certain state and municipal debt securities. These securities are class- ified as available-for-sale securities, and are reported at fair value. Available -for-sale investments in debt securities mature between April 2009 and August 2031. The Company uses the average cost method to determine the cost of securities sold and the amount reclassified out of accumulated other comprehensive income into earnings. Unrealized gains and losses are excluded from earnings and reported separately as a component of stockholder's equity. Dividend and interest income are accrued as earned. As of January 31, 2009, investments available-for-sale consisted of the following: Gross Gross Cost Unrealized Unrealized Fair Basis Gains Losses Value ------------ ------------ ------------ ------------ Municipal bonds $ 8,304,000 $ 110,000 $ (224,000) $ 8,190,000 Federal agency mortgage backed securities $ 325,000 $ 3,000 $ 0 $ 328,000 Corporate bonds $ 369,000 $ 0 $ (38,000) $ 331,000 Equity securities $ 7,142,000 $ 105,000 $(2,345,000) $ 4,902,000 Money markets and CDs $ 1,617,000 $ 0 $ 0 $ 1,617,000 ------------ ------------ ------------ ------------ Total $17,757,000 $ 218,000 $(2,607,000) $15,368,000
In accordance with SFAS 115, the Company evaluates all marketable securities for other-than temporary declines in fair value, which are defined as when the cost basis exceeds the fair value for approximately one year. The Company also evaluates the nature of the investment, cause of impairment and number of investments that are in an unrealized position. When an other- than-temporary decline is identified, the Company will decrease the cost of the marketable security to the new fair value and recognize a real loss. The investments are periodically evaluated to determine if impairment changes are required. As a result of this standard, management recorded impairment losses of $94,000 for the quarter ended January 31, 2009 and $499,000 for the nine months ended January 31, 2009. As for the corresponding periods last year, $16,000 worth of impairment loss was recorded for the quarter, while $23,000 of loss was recorded for the nine months ended January 31, 2008. The following table shows the investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by invest- ment category and length of time that individual securities have been in a continuous unrealized loss position, at January 31, 2009. Less than 12 months 12 months or greater Total ----------------------- --------------------- --------------------- Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss ........................................................................... Municipal bonds $1,675,000 $ (86,000) $2,083,000 $ (138,000) $3,758,000 $ (224,000) Federal agency mortgage backed securities $ 75,000 -- -- -- $ 75,000 -- Corporate bonds $ 283,000 $ (36,000) $ 48,000 $ (2,000) $ 331,000 $ (38,000) Equity securities $2,300,000 $(1,257,000) $1,604,000 $(1,088,000) $3,904,000 $(2,345,000) Total $4,333,000 $(1,379,000) $3,735,000 $(1,228,000) $8,068,000 $(2,607,000)
Municipal Bonds The unrealized losses on the Company's investments in municipal bonds were caused by interest rate increases. The contractual terms of these invest- ments do not permit the issuer to settle the securities at a price less than the amortized cost of the investment. Because the Company has the ability to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at January 31, 2009 Federal Agency Mortgage-Backed Securities The unrealized losses on the Company's investment in federal agency mortgage- backed securities were caused by interest rate increases. The Company pur- chased these investments at a discount relative to their face amount, and the contractual cash flows of these investments are guaranteed by an agency of the U.S. government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost of the Company's in- vestment. Because the decline in market value is attributable to changes in interest rates and not credit quality and because the Company has the ability to hold these investments until a recovery of fair value, which may be matur- ity, the Company does not consider these investments to be other-than-temp- orarily impaired at January 31, 2009. Corporate Bonds The Company's unrealized loss on investments in corporate bonds relates to several bonds. The contractual term of these investments do not permit the issuer to settle the security at a price less than the amortized cost of the investment. Because the Company has the ability to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at Jan- uary 31, 2009. Marketable Equity Securities The Company's investments in marketable equity securities consist of a wide variety of companies. Investments in these companies include growth, growth, and foreign investment objectives. Management has evaluated the individual holdings, and because of the recent decline in the stock market, does not consider these investments to be other-than-temporarily impaired at Jan- uary 31, 2009. Note 3 Inventories At January 31, 2009, inventories consisted of the following: Raw materials $ 1,907,000 Work in process 866,000 Finished goods 434,000 ------------ 3,207,000 Less: allowance for obsolete inventory (135,000) ------------ Totals $ 3,072,000
Note 4 Business Segments The following is financial information relating to industry segments:
Three Months Ended Nine Months Ended January 31, January 31, 2009 2008 2009 2008 ------------------------ ------------------------ Net revenue: Security alarm products $ 1,632,000 $ 2,325,000 $ 6,065,000 $ 7,629,000 Other products 193,000 247,000 674,000 1,189,000 ------------ ------------ ------------ ------------ Total net revenue $ 1,825,000 $ 2,572,000 $ 6,739,000 $ 8,818,000 Income from operations: Security alarm products $ 84,000 $ 413,000 $ 1,117,000 $ 1,934,000 Other products 10,000 44,000 124,000 301,000 ------------ ------------ ------------ ------------ Total income from operations $ 94,000 $ 457,000 $ 1,241,000 $ 2,235,000 Identifiable assets: Security alarm products $ 3,740,000 $ 4,260,000 $ 3,740,000 $ 4,260,000 Other products 967,000 888,000 967,000 888,000 Corporate general 21,837,000 23,327,000 21,837,000 23,327,000 ------------ ------------ ------------ ------------ Total identifiable assets $26,544,000 $28,475,000 $26,544,000 $28,475,000 Depreciation and amortization: Security alarm products $ 7,000 $ 7,000 $ 21,000 $ 23,000 Other products 26,000 27,000 78,000 82,000 Corporate general 8,000 8,000 24,000 23,000 ------------ ------------ ------------ ------------ Total depreciation and amortization $ 41,000 $ 42,000 $ 123,000 $ 128,000 Capital expenditures: Security alarm products $ 3,000 $ 0 $ 3,000 $ 1,000 Other products 0 0 21,000 144,000 Corporate general 15,000 0 32,000 28,000 ------------ ------------ ------------ ------------ Total capital expenditures $ 18,000 $ 0 $ 56,000 $ 173,000
Note 5 Earnings per Share Basic and diluted earning per share, assuming convertible preferred stock was converted for each period presented, are:
For the three months ended January 31, 2009 ------------------------------------------- Income Shares Per-share (Numerator) (Denominator) Amount ----------- ------------- ----------- Net Income $ (171,000) =========== Basic EPS $ (171,000) 5,173,372 $ (0.033) Effect of dilutive securities: Convertible preferred stock 0 20,500 ----------- ------------- ----------- Diluted EPS $ (171,000) 5,193,872 $ (0.033) For the nine months ended January 31, 2009 ------------------------------------------- Income Shares Per-share (Numerator) (Denominator) Amount ----------- ------------- ----------- Net Income $ 568,000 =========== Basic EPS $ 568,000 5,175,189 $ 0.110 Effect of dilutive securities: Convertible preferred stock 0 20,500 ----------- ------------- ----------- Diluted EPS $ 568,000 5,195,689 $ 0.109 For the three months ended January 31, 2008 -------------------------------------------- Income Shares Per-share (Numerator) (Denominator) Amount ----------- ------------- ----------- Net Income $ 327,000 =========== Basic EPS $ 327,000 5,333,116 $ 0.061 Effect of dilutive securities: Convertible preferred stock 0 20,500 ----------- ------------- ----------- Diluted EPS $ 327,000 5,353,616 $ 0.061 For the nine months ended January 31, 2008 -------------------------------------------- Income Shares Per-share (Numerator) (Denominator) Amount ----------- ------------- ----------- Net Income $1,905,000 ========= Basic EPS $1,905,000 5,334,553 $ 0.357 Effect of dilutive securities: Convertible preferred stock 0 20,500 ----------- ------------- ----------- Diluted EPS $1,905,000 5,355,053 $ 0.356
Note 6 Retirement Benefit Plan On January 1, 1998, the Company adopted the George Risk Industries, Inc. Retirement Savings Plan (the "Plan"). The Plan is a defined contribution savings plan designed to provide retirement income to eligible employees of the corporation. The Plan is intended to be qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended. Matching contributions by the Company of approximately $3,000 and $4,000 were paid during each quarter ending January 31, 2009 and 2008, respectively. Likewise, the Company paid matching contributions of $9,000 during the nine-month period ending Jan- uary 31, 2009 and $10,000 during the nine-month period ending January 31, 2008. There were no discretionary contributions paid during either the quarters or nine-month periods ending January 31, 2009 and 2008, respectively. GEORGE RISK INDUSTRIES, INC. PART I. FINANCIAL INFORMATION Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with the attached con- densed consolidated financial statements, and with the George Risk Industries' audited financial statements and discussion for the fiscal year ended April 30, 2008. Liquidity and capital resources ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Operating --------- Net cash increased $236,000 for the nine months ended January 31, 2009, while, for the same period last year, net cash increased $29,000. Accounts receivable decreased $478,000 for the current nine months and decreased $495,000 for the same period last year. The decreases in cash flow for accounts receivable is a reflection of the decreases in sales. At Jan- uary 31, 2009, 86.1% of the receivables were considered current (less than 45 days) and 3.0% of the total were over 90 days past due. For comparison, 79.9% of the receivables were current and 5.8% were past 90 days at Jan- uary 31, 2008. Inventories increased $28,000 for the current nine months, while it decreased $3,000 for the same period last year. Management has not been able to slow down some of its "blanket order" purchase orders of raw materials during the current fiscal year. Therefore, the stock of raw ma- terials is higher since we have seen a decrease in sales. Changes in prepaid expenses in regards to cash flow decreased by $13,000 and $53,000 for the nine-month periods ending January 31, 2009 and 2008, respectively. For the current fiscal year, there have been income tax overpayments. Cash towards income tax overpayment decreased $349,000 for the nine months ended Jan- uary 31, 2009, while it increased $150,000 for the same period last year. Management paid income tax estimates based on prior year taxable income and the company has not received its income tax refund from the state yet. For the nine months ended January 31, 2009, accounts payable increased $17,000, and decreased $52,000 for the same period ended January 31, 2008. The current year increase is just a timing issue for when inventory and supplies came in. More inventory arrived towards the end of the month of January 2009, so there was an increase in accounts payable. Accrued expenses decreased $75,000 for the nine months ended January 31, 2009, and these ex- penses also decreased $68,000 for the corresponding nine months last year. This bigger decrease for the current year is due to reduced sales commissions and fewer employees. Investing --------- As for our investment activities, $56,000 was spent on purchases of property and equipment during the current nine-month period and $173,000 was spent during the nine months ended January 31, 2008. Additionally, the Company con- tinues to purchase marketable securities, which include municipal bonds and quality stocks. Cash spent on purchases of marketable securities for the nine months ended January 31, 2009 was $1,146,000 and $4,784,000 was spent for the corresponding period last year. In addition, proceeds from the sale of marketable securities for the nine months ended January 31, 2009 were $98,000 and $3,542,000 for the same period last year. We use "money manager" accounts for most stock transactions. By doing this, the Company gives an independent third party firm, who are experts in this field, permission to buy and sell stocks at will. The Company pays a quarterly service fee based on the value of the investmnts. Furthermore, the Company continues to pur- chase back its common stock when the opportunity arises. For the nine months ended January 31, 2009, the Company purchased $26,000 worth of treasury stock and $32,000 worth was bought back for the nine months ended January 31, 2008. We have been actively searching for stockholders that have been "lost" over the years. The payment of dividends over the last five fiscal years has also prompted many stockholders and/or their relatives and descendants to sell back their stock to the Company. Financing --------- Cash flows from financing activities decreased by $802,000 for the nine months ending January 31, 2009. That figure consists of the payment of dividends during the second quarter. The company declared a dividend of $0.17 per share of common stock on September 30, 2008 and these dividends were paid by October 31, 2008. As for the prior year numbers, net cash used in financing activities was $829,000 for the nine months ending January 31, 2008. A dividend of $0.17 per common share was also declared and paid during the second fiscal quarter last year. The following is a list of ratios to help analyze George Risk Industries' performance: For the quarter ended January 31, 2009 2008 --------------------------- Working capital $ 24,731,000 $ 26,705,000 Current ratio 39.224 46.806 Quick ratio 32.005 40.369
Results of operations ~~~~~~~~~~~~~~~~~~~~~ Net sales were $1,825,000 for the quarter ended January 31, 2009, which is a 29.04% decrease from the corresponding quarter last year. Year-to-date net sales at January 31, 2009 were $6,739,000, which is a 23.58% decrease from the same period last year. The Company has seen decreases in sales as a re- sult of the downturn in the housing market. Cost of goods sold was 59.5% of net sales for the quarter ended January 31, 2009 and 54.35% for the same quarter last year. Year-to-date cost of goods sold percentages were 51.3% for the current nine months and 50.0% for the corresponding nine months last year. Management has reduced labor hours and head count to lessen labor costs, but not as fast as it should have to stay within the desired range of 45 to 50% of the cost of goods sold percentage. Operating expenses were 35.34% of net sales for the quarter ended January 31, 2009 as compared to 27.95% for the corresponding quarter last year. Year-to- date operating expenses were 30.29% of net sales for the nine months ended January 31, 2009, while they were 24.64% for the same period last year. The increase in the percentages for operating expenses shows that management has not accounted for the slow down in sales as well has it should have. But management has begun, in the fourth quarter, to cut labor costs for office personnel in response to these increased percentages. Income from operations for the quarter ended January 31, 2009 was at $94,000, which is a 79.4% de- crease from the corresponding quarter last year, which had income from oper- ations of $457,000. Income from operations for the nine months ended Jan- uary 31, 2009 was at $1,241,000, which is a 44.5% decrease from the cor- responding nine months last year, which had income from operations of $2,235,000. Other income and expenses showed losses of $180,000 and $326,000 for the quarter and nine months ended January 31, 2009. The numbers for the cor- responding periods last year were gains of $140,000 for the quarter and $705,000 for the nine-months ending January 31, 2008. Dividend and interest income was down 18.1% for the quarter and was down 7.9% for the current nine- month period when comparing to the same time periods last year. Gain and loss on investments is where the biggest loss is in this category. Manage- ment wrote down $94,000 for impaired investments for the current quarter. This is compared to write downs of $16,000 for the same quarter last year. For the year-to-date ended January 31, 2009, management wrote down $499,000 for impaired investments and $23,000 was written down for the same period last year. Net loss for the quarter ended January 31, 2009 was $171,000, a 152.3% de- crease from the corresponding quarter last year, which showed net income of $327,000. Net income for the nine months ended January 31, 2009 was $568,000, a 70.2% decrease from the same period last year. Net income for the nine months ended January 31, 2008 was $1,905,000. Earnings per common share for the quarter ended January 31, 2009 was $(0.03) per share and $0.11 per share for the year-to-date numbers. EPS for the quarter and nine months ended January 31, 2008 was $0.06 per share and $0.36 per share, respectively. New product information ~~~~~~~~~~~~~~~~~~~~~~~ The revamped window bar (pt # WB-30-42) has been in production for about a month and is selling very well. The window bar is a piece of extruded aluminum that fits windows 30" - 42" and is secured by brackets with a sec- urity switch on one end. These are popular for basement windows in North- eastern US, and can also be used in attic vents and doors. A sister product, a wire trip unit (pt # WT-01), uses a simple box plunger attached to one side of the window and is strung with wire to the opposite side. If the wire is cut or tampered, the plunger releases and sets off the alarm. The new WVS (Water Value Shutoff) switch will be introduced at the Inter- national Security Conference (ISC) trade show in Las Vegas, NV the first week of April 2009. The WVS uses our 2600 water sensor to close the water main if a leak (or more than a leak) is detected. Features of this device include a voltage check on the water valve and sensor once a week. Every fourth week it does a complete valve check on the voltage and closes and opens the valve to make sure everything is in working order. Engineering completed several programming updates on our door monitoring de- vices. Work continues on the hold-up switch, the wireless line, and the environmental sensors. Recently issued accounting pronouncements ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally Accepted Accounting Principles". This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting prin- ciples (GAAP) in the United States (the GAAP hierarchy). The statement will become effective 60 days following the SEC's approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Pre- sent Fairly in Conformity With Generally Accepted Accounting Principles. Other Information ~~~~~~~~~~~~~~~~~ There are no known seasonal trends with any of our products, since we sell to distributors and OEM manufacturers. The products are tied to the housing industry and will fluctuate with building trends. We are increasingly receiving notification that some of our off-shore com- petitors are creating more purchasing demands and are no longer selling to some of their smaller customers. We see this as an opportunity to create more business. We hope to achieve this with our accomplished customer ser- vice and our ability to customize products for customer's special needs. GEORGE RISK INDUSTRIES, INC. PART I. FINANCIAL INFORMATION Item 3. Controls and Procedures (a) Information required by Item 307 Our Chief Executive Officer and our Chief Financial Officer, after evaluating the effectiveness of the Company's "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 (Exchange Act) Rules 13a-15(e) or 15d-15(e)) as of the end of the period covered by this quarterly report, have concluded that our disclosure controls and procedures are effective based on their evaluation of these controls and procedures required by para- graph (b) of Exchange Act Rules 13a-15 or 15d-15. (b) Information required by Item 308 This disclosure is not yet required. Item 3A(T). Controls and Procedures Evaluation of disclosure controls and procedures: ------------------------------------------------- Based on their evaluation of our disclosure controls and procedures (as de- fined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of Jan- uary 31, 2009, our president and chief executive officer and our chief finan- cial officer have concluded that our disclosure controls and procedures are effective such that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and (ii) accumulated and communicated to our management, including our chief executive officer and our chief financial officer, as appropriate to allow timely decisions regarding disclosure. A control system cannot provide absolute assurance, however, that the ob- jectives of the control systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Changes in internal controls over financial reporting: ------------------------------------------------------ There was no change in our internal controls over financial reporting that occurred during the period covered by this report, that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting. GEORGE RISK INDUSTRIES, INC. Part II. OTHER INFORMATION Item 1. Legal Proceedings Not applicable Item 2. Changes in Securities Not applicable. Item 3. Defaults upon Senior Securities Not applicable Item 4. Submission of Matters to a Vote of Securities Not applicable Item 5. Other Information Not applicable Item 6. Exhibits and Reports on Form 8-K A. Exhibits 31. Certifications pursuant to Rule 13a-14(a) 31.1 Certification of the Chief Executive Officer 31.2 Certification of the Chief Financial Officer 32. Certifications pursuant to 18 U.S.C. 1350 32.1 Certification of the Chief Executive Officer 32.2 Certification of the Chief Financial Officer B. Reports on Form 8-K No 8-K reports were filed during the quarter ended January 31, 2009. SIGNATURES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. George Risk Industries, Inc. (Registrant) Date 03-17-2009 By: /s/ Kenneth R. Risk Kenneth R. Risk President and Chairman of the Board Date 03-17-2009 By: /s/ Stephanie M. Risk Stephanie M. Risk Chief Financial Officer and Controller