Calgon Carbon Announces First Quarter Results
PITTSBURGH, PA – 05/02/2008
Calgon Carbon Corporation (NYSE: CCC) announced results for the first quarter ended March 31, 2008.
The company reported net income of $10.9 million for the first quarter of 2008, as compared to net income of $2.0 million for the first quarter of 2007. On a fully diluted share basis, earnings per common share for the first quarter of 2008 were $0.21 versus $0.05 for the first quarter of 2007.
Included in the first quarter results is a non-recurring pre-tax gain of $9.3 million from the settlement of a lawsuit involving Calgon Carbon’s purchase of the common stock of Advanced Separation Technologies Incorporated (AST) in 1996. On an after-tax basis the gain was $5.7 million, or $0.11 per common share on a fully diluted basis.
Net sales for the first quarter of 2008 were $90.3 million versus first quarter 2007 net sales of $83.0 million, an increase of 8.8%. Currency translation had a $2.7-million positive impact on sales for the first quarter of 2008 due to the stronger Euro and the British Pound Sterling.
For the first quarter of 2008, sales for the Activated Carbon and Service segment increased by 12.0% versus the first quarter of 2007. The increase was due to higher demand and pricing in the food, environmental water treatment, respirator, and mercury removal markets and to higher demand in the environmental air treatment and metals recovery markets. Equipment sales declined by 11.6% in the first quarter of 2008 versus the comparable period in 2007, primarily due to lower demand for ion exchange systems, which was partially offset by an increase in demand for ultraviolet light systems. A 10.5% increase in Consumer sales for the first quarter of 2008 was attributable to higher demand for PreZerve® products and carbon cloth.
Net sales less the cost of products sold as a percentage of net sales for the first quarter of 2008 was 31.6% versus 29.6% for the first quarter of 2007. The increase was primarily due to higher pricing on certain carbon and service products.
Selling, administrative and research (SG&A) expenses for the first quarter of 2008 increased by 5.6% versus the comparable period in 2007. In the first quarter of 2007, SG&A expense included the positive effect of a settlement with Trojan Technologies related to the company’s patents for the use of ultraviolet light to disinfect drinking water.
Equity in income from equity investments was $0.4 million for the first quarter of 2008 versus $1.1 million for the comparable period in 2007. The decrease was primarily due to higher product costs.
Calgon Carbon’s board of directors did not declare a quarterly dividend.
Commenting on the quarter, John Stanik, Calgon Carbon’s chairman, president and chief executive officer, said, “We are off to a good start in 2008. The first quarter results reflect continued progress in obtaining fair market prices for our activated carbon products and services. Revenue growth, derived from price increases and sales of outsourced products, will remain a key driver of the company’s performance throughout the year.”
Calgon Carbon Corporation, headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making air and water cleaner and safer.
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. This document contains certain statements that are forward-looking relative to the company’s future strategy and performance. They involve known and unknown risks and uncertainties that may cause the company’s actual results in future periods to be materially different from any future performance.
Condensed Consolidated Balance Sheet
(Dollars in thousands)
|March 31, 2008||December 31, 2007|
|Cash and cash equivalents||$ 35,135||$ 30,304|
|Other current assets||19,661||20,546|
|Total current assets||197,081||189,678|
|Property, plant and equipment, net||110,828||105,512|
|Total assets||$ 360,401||$ 348,140|
|LIABILITIES AND SHAREHOLDERS’ EQUITY|
|Short-term debt||$ 1,566||$ 1,504|
|Current portion of long-term debt||62,662||62,507|
|Other current liabilities||52,251||55,750|
|Total current liabilities||116,479||119,761|
|Total shareholders’ equity||188,870||172,249|
|Total liabilities and shareholders’ equity||$ 360,401||$ 348,140|
Condensed Consolidated Statement of Income
(Dollars in thousands except per share data)
|Quarter Ended March 31,|
|Net Sales||$ 90,331||$ 83,030|
|Cost of Products Sold||61,765||58,424|
|Depreciation and Amortization||3,926||4,261|
|Selling, Administrative & Research||16,291||15,434|
|Gain from AST Settlement||(9,250)||–|
|Income from Operations||17,599||4,911|
|Interest Expense – Net||(839)||(1,148)|
|Other Expense – Net||(90)||(403)|
|Income From Operations Before Income Tax and Equity in Income from Equity Investments||16,670||3,360|
|Income Tax Provision||6,234||2,380|
|Income from Operations Before|
|Equity in Income from Equity Investments||10,436||980|
|Equity in Income from Equity Investments||438||1,054|
|Net Income||$ 10,874||$ 2,034|
|Net Income per Common Share|
|Diluted||$ .27||$ .05|
|$ .21||$ .05|
|Weighted Average Shares Outstanding (Thousands)|
Setment Data – Continuing Operations
|Carbon and Service||76,898||68,683|
|Total Sales (thousands)||$ 90,331||$ 83,030|
|Segment Operating Income (Loss)*||1Q08||1Q07|
|Carbon and Service||17,376||8,473|
|Total Income from Operations (thousands)||$ 21,525||$ 9,172|