Press Release

Calgon Carbon Announces Third Quarter Results

PITTSBURGH, PA  –  10/24/2002

Calgon Carbon Corporation (NYSE: CCC) announced results for the third quarter ended September 30, 2002.

Sales for the third quarter were $64.8 million, slightly above the $64.7 million reported for the third quarter of 2001. Sales for the nine months ended September 30, 2002 were $195.5 million versus $206.6 million for the first three quarters of 2001.

Segment Sales 3Q02 3Q01 YTD
2002
YTD
2001

Activated Carbon $ 24,218 $ 25,074 $ 74,723 $ 81,915
Service 24,275 23,476 71,073 71,000
Engineered Solutions 10,875 11,305 30,710 37,034
Consumer Health 5,464 4,888 18,946 16,611

    Total Sales (thousands)  $ 64,832  $ 64,743  $ 195,452  $ 206,560

Operating income for the quarter was $1.5 million less than operating income for the third quarter of 2001. Excluding the adverse effects of start-up problems with a major Engineered Solutions customer installation, operating income for the third quarter of 2002 would have shown improvement over the third quarter of 2001.

Segment Operating Income 3Q02 3Q01 YTD 2002 YTD 2001

Activated Carbon $ 3,768 $ 4,234 $ 12,192 $ 14,316
Service 5,225 4,466 14,496 14,783
Engineered Solutions (1,840) 57 (3,546) 1,817
Consumer Health (601) (460) (402) (146)

    Total Income (loss)
    from operations (thousands)
 $ 6,552  $ 10,392  $ 22,740  $ 30,770

For the third quarter of 2002, net income was $0.6 million versus $1.5 million for the third quarter of 2001. Excluding the cumulative effect of accounting change, net income for the nine months ended September 30, 2002 was $4.0 million. For the nine months ended September 30, 2002, the company reported a loss of $27.0 million, including an after-tax $30.9-million cumulative effect of accounting change for the impairment of certain goodwill related to an acquisition made in 1996.

Earnings per share for the third quarter of 2002 were $0.01 versus $0.04 for the third quarter of 2001. Earnings per share for the nine months ended September 30, 2002 were $0.10 versus $0.20 for the comparable period in 2001, excluding the cumulative effect of accounting change.

Commenting on activity in the third quarter, James A. Cederna, Calgon Carbon’s chairman and chief executive officer, said, “Although sales for the quarter were up only slightly, every platform made progress on their growth initiatives in spite of the down economy:

  • We made the first deliveries of activated carbon from our new Chinese facilities to Asian drinking water plants, and we have major orders in hand for additional shipments over the next two years.
  • Our Service business continues to steadily find new customers and new ways to service old customers around the world.
  • Our Engineered Solutions team obtained approximately $20MM in new backorders for services for the removal of perchlorate from contaminated water.
  • We launched several new PreZerve™ consumer products with our partner QVC and we are expecting record fourth quarter sales during the holiday season.

Excluding the unplanned start-up costs at one customer, our margins for the quarter improved as a result of excellent cost control throughout the Company and sales of higher margin products. We look at the large cost overruns of this Engineered Solutions installation as the pains of introducing leading-edge technology to the market. This is an investment which should pay dividends in the long run because successful scale-up will position us for millions of dollars of new business via purification technology no one else can match.”

Calgon Carbon’s board of directors declared a dividend of $0.03 per common share. Dividends will be issued to shareholders of record as of November 11, 2002, and will be payable on December 2, 2002.

The Company will also announce organizational changes in a separate release today.

Calgon Carbon Corporation (dev.calgoncarbon.com), headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making air and water cleaner and safer. The company employs approximately 1,000 people at 13 operating facilities and 11 sales and service centers worldwide.

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. This document contains certain statements that are forward-looking relative to the company’s future strategy and performance. They involve known and unknown risks and uncertainties that may cause the company’s actual results in future periods to be materially different from any future performance.

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Calgon Carbon Corporation Condensed Consolidated Statement of Income (Dollars in thousands except per share data) (Unaudited)

  Quarter Ended        Nine Months Ended
    September 30,
2002
    September 30,
  2001
    September 30,
2002
    September 30,
  2001
 
Net Sales $ 64,832 $ 64,743   $ 195,452 $ 206,560

Cost of Products Sold 45,368 44,429   135,293 137,610
Depreciation and Amortization 4,784 5,023   14,027 14,997
Selling, Administrative & Research 12,912 12,017   37,419 38,180

  63,064 61,469   186,739 190,787
 
Income from Operations 1,768 3,274   8,713 15,773
Interest Income (Expense) – Net (499) (627)   (1,539) (2,668)
Other Income (Expense) – Net (445) (231)   (1,147) (922)

Income Before Income

  Taxes and Minority Interest
824 2,416   6,027 12,183
Provision for Income Taxes 297 870   2,170 4,386

Income Before Minority Interest 527 1,546   3,857 7,797
Minority Interest 29   29 (53)

Income Before Cumulative

  Effect of Acconting Change
1,546 1,546   7,797 7,523
Cumulative Effect of

  Acconting Change
  (30,926)

Net Income $   556 $   1,546   ($  27,040) $    7,279

Net Income per Common

  Share Before Cumulative Effect of Accounting Change (Basic and Diluted)
$       .01 $       .04   $        .10 $        .20
Cumulative Effect of Accounting

  Change per Common Share (Basic and Diluted)
  ($        .79)
Adjusted Net Income

  per Common Share
(Basic and Diluted)
$       .01 $       .04   ($        .69) $        .20

Weighted Average Shares

  Outstanding (Thousands)
         
    Basic
38,963 38,811   38,931 38,805
    Diluted
39,017 39,175   39,187 39,091

Calgon Carbon Corporation Condensed Consolidated Balance Sheet (Dollars in thousands) (Unaudited)

  September 30, 2002 December 31, 2001
 
ASSETS    

Current assets:    
    Cash and cash equivalents $     3,569 $     3,567
    Receivables 44,856 44,233
    Inventories 48,659 42,104
    Other current assets 11,338  14,631 
 
        Total current assets 108,422 104,535 
Property, plant and equipment, net 141,894 143,661 
Other assets 32,583 83,518 

    Total assets $ 282,899 $ 331,714 

     
LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:    
    Short-term debt $          – $     8,762 
    Long-term debt due within one year 2,785 1,275 
    Other current liabilities 37,459 37,705 
 
        Total current liabilities 40,244 47,742 
Long-term debt 56,842 54,360 
Other liabilities 28,353 45,803 
 
    Total liabilities 125,439 147,905 
Minority Interest 141  – 
Total shareholders’ equity 157,319 183,809 

    Total liabilities and shareholders’ equity $ 282,899 $ 331,714 

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For more information, please contact Gail Gerono (412) 787-6795