Hudson Technologies First Quarter Revenues Increase 27% to $28.2 Million; EPS of $0.09
By Business Wire News
By Business Wire News
PEARL RIVER, N.Y.
Hudson Technologies, Inc. (NASDAQ:HDSN) announced results for the first quarter ended March 31, 2016.
Revenues for the three months ended March 31, 2016 were $28.2 million, an increase of 27% compared to $22.1 million in the comparable 2015 period. The revenue increase in the quarter is primarily related to an increase in the price and volume of certain refrigerants. Gross margin improved to 27% in the first quarter of 2016 compared to 25% in the prior year period. Net income for the quarter was $2.9 million, or $0.09 per basic and diluted share, compared to net income of $1.9 million, or $0.06 per basic and diluted share, in the first quarter of 2015.
Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “We’re pleased to have gotten off to a strong start in the first quarter with solid revenue growth, improved margins and increased profitability. Our revenue increase in the quarter was related to a higher average selling price for certain refrigerants, including R-22. The price increase in R-22 is driven by the ongoing federally mandated phase-out of virgin production of R-22, which will ultimately be eliminated by 2020. The first quarter is typically characterized by ‘pre-sales’ ahead of the cooling season and we achieved our targeted volume growth rate this quarter.
“As we expected, gross margin improved in the first quarter of 2016. We believe that our gross margin will continue to be in the mid to upper twenty percent range throughout our nine-month refrigerant season, as we see improved pricing on HFCs (hydrofluorocarbons). Going forward, we anticipate HFC-based refrigerants will continue to be a volume growth area for our business and we do not expect to see the margin compression related to HFCs that we experienced during the 2015 sales season.”
Mr. Zugibe concluded, “We are anticipating further growth in reclamation, not just in response to the R-22 production phase-out but also related to the expected phase-out of next generation HFC-based refrigerants. The high global warming potential of HFCs, which are the replacement refrigerants for HCFCs such as R-22, has drawn increased concern from the worldwide community, resulting in HFCs also being targeted for phase out. As the largest reclaimer in the industry, with proprietary technology, a robust distribution network and long term relationships, we believe we are well positioned to assist our customers as they prepare for the ongoing changes in our marketplace.”
CONFERENCE CALL INFORMATION
The Company will host a conference call to discuss the first quarter results today, May 4, 2016 at 5:00 P.M. Eastern Time.
To access the live webcast, log onto the Hudson Technologies website at www.hudsontech.com, and click on “Investor Relations”. To participate in the call by phone, dial (877) 407-9205 approximately five minutes prior to the scheduled start time. International callers please dial (201) 689-8054.
A replay of the teleconference will be available until June 4, 2016 and may be accessed by dialing (877) 660-6853. International callers may dial (201) 612-7415. Callers should use conference ID: 13635398.
About Hudson Technologies
Hudson Technologies, Inc. is a leading provider of innovative solutions to recurring problems within the refrigeration industry. Hudson’s proprietary RefrigerantSide® Services increase operating efficiency and energy savings, and remove moisture, oils and other contaminants frequently found in the refrigeration circuits of large comfort cooling and process refrigeration systems. Performed at a customer’s site as an integral part of an effective scheduled maintenance program or in response to emergencies, RefrigerantSide® Services offer significant savings to customers due to their ability to be completed rapidly and at higher purity levels, and can be utilized while the customer’s system continues to operate. In addition, the Company sells refrigerants and provides traditional reclamation services to the commercial and industrial air conditioning and refrigeration markets. For further information on Hudson, please visit the Company’s web site at www.hudsontech.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements contained herein which are not historical facts constitute forward-looking statements. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changes in the laws and regulations affecting the industry, changes in the demand and price for refrigerants (including unfavorable market conditions adversely affecting the demand for, and the price of, refrigerants), the Company’s ability to source refrigerants, regulatory and economic factors, seasonality, competition, litigation, the nature of supplier or customer arrangements that become available to the Company in the future, adverse weather conditions, possible technological obsolescence of existing products and services, possible reduction in the carrying value of long-lived assets, estimates of the useful life of its assets, potential environmental liability, customer concentration, the ability to obtain financing, any delays or interruptions in bringing products and services to market, the timely availability of any requisite permits and authorizations from governmental entities and third parties as well as factors relating to doing business outside the United States, including changes in the laws, regulations, policies, and political, financial and economic conditions, including inflation, interest and currency exchange rates, of countries in which the Company may seek to conduct business, the Company’s ability to successfully integrate any assets it acquires from third parties into its operations, and other risks detailed in the Company’s 10-K for the year ended December 31, 2015 and other subsequent filings with the Securities and Exchange Commission. The words “believe”, “expect”, “anticipate”, “may”, “plan”, “should” and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.
|Hudson Technologies, Inc. and subsidiaries|
|Consolidated Income Statements|
(Amounts in thousands, except for share and per share amounts)
|Three month periods|
ended March 31,
|Cost of sales||20,645||16,578|
|Selling and marketing||1,117||960|
|General and administrative||1,386||1,295|
|Total operating expenses||2,503||2,255|
|Income before income taxes||4,748||3,063|
|Income tax expense||1,804||1,170|
|Net income per common share – Basic||$||0.09||$||0.06|
|Net income per common share – Diluted||$||0.09||$||0.06|
|Weighted average number of shares outstanding – Basic||32,888,659||32,333,443|
|Weighted average number of shares outstanding – Diluted||33,944,876||34,280,385|
|Hudson Technologies, Inc. and subsidiaries|
|Consolidated Balance Sheets|
(Amounts in thousands, except for share and par value amounts)
|Cash and cash equivalents||$||1,167||$||1,258|
|Trade accounts receivable – net||15,840||4,414|
|Deferred tax asset||376||376|
|Prepaid expenses and other current assets||3,728||1,524|
|Total current assets||76,395||69,469|
|Property, plant and equipment, less accumulated depreciation||7,216||7,536|
|Deferred tax asset||1,562||3,287|
|Intangible assets, less accumulated amortization||3,634||3,787|
Liabilities and Stockholders’ Equity
|Trade accounts payable||$||3,799||$||5,792|
|Accrued expenses and other current liabilities||2,668||3,018|
|Short-term debt and current maturities of long-term debt||26,141||20,573|
|Total current liabilities||32,864||30,960|
|Long-term debt, less current maturities||4,212||4,293|
|Commitments and contingencies|
|Preferred stock, shares authorized 5,000,000:|
|Series A convertible preferred stock, $0.01 par value ($100|
liquidation preference value); shares authorized 150,000; none
issued or outstanding
Common stock, $0.01 par value; shares authorized 100,000,000;
issued and outstanding 32,968,741 and 32,804,276
|Additional paid-in capital||62,450||62,163|
|Total Stockholders’ Equity||52,657||49,425|
|Total Liabilities and Stockholders’ Equity||$||89,733||$||85,011|
Institutional Marketing Services (IMS)
John Nesbett/Jennifer Belodeau
Hudson Technologies, Inc.
Brian F. Coleman, President & COO