Pro forma adjusted gross profit and adjusted gross margins for the nine months ending September 30, 2010, which include Gregory and exclude the $4.3 million increase in cost of goods sold due to the increase in inventory value, would have been $35.2 million and 38.8% compared to $31.9 million and 38.2% in the same period in 2009. The stronger gross margin is mainly due to economies of scale in our manufacturing operations.
Net income, as reported for the nine months ended September 30, 2010 was $51.6 million, or $2.67 per diluted share. Excluding non-cash items of $(59.9) million, combined net income before non-cash items was a loss of $(5.9) million, or $(0.31) per share. Excluding transaction, restructuring, and merger and integration costs relating to the acquisitions of $7.5 million, net of related taxes, combined adjusted net income before non-cash items was income of $1.6 million, or $0.08 per diluted share. Following this press release is a reconciliation of net income to net income before non-cash items, adjusted net income before non-cash items and related earnings per share for the combined three and nine month period ended September 30, 2010 and September 30, 2009.
Cash at September 30, 2010, totaled $1.6 million.Total long-term debt including the current portion of long term debt was $32.9 million at September 30, 2010, which included $19.2 million outstanding on our $35.0 million line of credit, and a discounted value of $13.4 million on our 5% subordinated notes, as well as $0.3 million in capital leases and other debt. The face value of the 5% subordinated notes is $22.1 million. The increase in our line of credit is due to our seasonal working capital increases. The Company historically experiences increases in accounts receivable and inventory during the third quarter, as it enters into the fall and winter seasons.