This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Fuel Tech Reports 2011 Fourth Quarter And Annual Financial Results; Records Achieved In Backlog, APC Announced Bookings And Annual Revenues And Operating Income

The Company’s nitrogen oxide (NOx) reduction technologies include advanced combustion modification techniques - such as Low NOx Burners and Over-Fire Air systems - and post-combustion NOx control approaches, including NOxOUT® and HERT™ SNCR systems as well as systems that incorporate ASCR™ (Advanced Selective Catalytic Reduction), NOxOUT CASCADE®, ULTRA™ and NOxOUT-SCR® processes. These technologies have established Fuel Tech as a leader in NOx reduction, with installations on over 700 units worldwide, where coal, fuel oil, natural gas, municipal waste, biomass, and other fuels are utilized.

The Company’s FUEL CHEM® technology revolves around the unique application of chemicals to improve the efficiency, reliability, fuel flexibility and environmental status of combustion units by controlling slagging, fouling, corrosion, opacity and operational issues associated with sulfur trioxide, ammonium bisulfate, particulate matter (PM 2.5), carbon dioxide and NOx. This technology, in the form of a customizable FUEL CHEM program, is experienced on over 110 combustion units burning a wide variety of fuels including coal, heavy oil, biomass, and municipal waste.

Fuel Tech also provides a range of combustion optimization services, including airflow testing, coal flow testing and boiler tuning, as well as services to help optimize selective catalytic reduction system performance, including catalyst management services and ammonia injection grid tuning. In addition, flow corrective devices and physical and computational modeling services are available to optimize flue gas distribution and mixing in both power plant and industrial applications.

Many of Fuel Tech’s products and services rely heavily on the Company’s exceptional Computational Fluid Dynamics modeling capabilities, which are enhanced by internally developed, high-end visualization software. These capabilities, coupled with the Company’s innovative technologies and multi-disciplined team approach, enable Fuel Tech to provide practical solutions to some of our customers’ most challenging problems. For more information, visit Fuel Tech’s web site at www.ftek.com .

This press release may contain statements of a forward-looking nature regarding future events. These statements are only predictions and actual events may differ materially. Please refer to documents that Fuel Tech files from time to time with the Securities and Exchange Commission for a discussion of certain factors that could cause actual results to differ materially from those contained in the forward-looking statements.

   

FUEL TECH, INC.

CONSOLIDATED BALANCE SHEETS
(in thousands of dollars, except share and per-share data)

December 31,  

  2011       2010  
ASSETS
Current assets:
Cash and cash equivalents $ 28,229 $ 30,524
Marketable securities 57 -
Accounts receivable, net of allowance for doubtful accounts of $430 and $82, respectively 34,346 21,175
Inventories 311 807
Prepaid expenses and other current assets 2,026 1,861
Income taxes receivable 1,124 -
Deferred income taxes   163       89  
Total current assets 66,256 54,456
 
Property and equipment, net of accumulated depreciation of $18,239 and $15,767, respectively 13,625 14,384
Goodwill 21,051 21,051
Other intangible assets, net of accumulated amortization of $3,385 and $3,203, respectively 5,442 6,050
Deferred income taxes 3,798 5,000
Other assets   2,818       2,262  
Total assets $ 112,990     $ 103,203  
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term debt $ 1,181 $ 2,269
Accounts payable 10,476 7,516
Accrued liabilities:
Employee compensation 4,902 2,863
Income taxes payable - 1,857
Other accrued liabilities   6,071       3,306  
Total current liabilities 22,630 17,811
 
Other liabilities   1,347       1,482  
Total liabilities 23,977 19,293
 
Stockholders' equity:

Common stock, $.01 par value, 40,000,000 shares authorized, 23,644,301 and 24,213,467 shares issued and outstanding, respectively

237 242
Additional paid-in capital 132,350 129,424
Accumulated deficit (44,031 ) (46,075 )
Accumulated other comprehensive income 381 243
Nil coupon perpetual loan notes   76       76  
Total stockholders' equity   89,013       83,910  
Total liabilities and stockholders' equity $ 112,990     $ 103,203  
 
   

FUEL TECH, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per-share data)
 
Three Months Ended Twelve Months Ended
December 31 December 31
  2011       2010     2011       2010  
 
Revenues $ 28,002 $ 24,997 $ 93,668 $ 81,795
 
Costs and expenses:
Cost of sales 14,788 14,758 49,857 46,821
Selling, general and administrative 9,828 7,551 33,446 30,857
Gain from revaluation of contingent performance obligation - - (758 ) (768 )
Research and development   399     373     1,474     948  
  25,015     22,682     84,019     77,858  
 
Operating income 2,987 2,315 9,649 3,937
 
Interest expense (23 ) (33 ) (148 ) (143 )
Interest income 16 5 35 11
Other (expense) income   (27 )   50     (279 )   (119 )
Income before taxes

2,953

2,337 9,257 3,686
 
Income tax expense   (1,229 )   (1,306 )   (3,109 )   (1,933 )
 
Net income $ 1,724   $ 1,031   $ 6,148   $ 1,753  
 
Net income per common share:
Basic $ 0.07   $ 0.04   $ 0.26   $ 0.07  
Diluted $ 0.07   $ 0.04   $ 0.25   $ 0.07  
 
Weighted-average number of common shares outstanding:
Basic   23,725,000     24,213,000     24,095,000     24,213,000  
Diluted   24,331,000     24,432,000     24,633,000     24,405,000  
 
   

FUEL TECH, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars)

 

For the years ended December 31,

  2011       2010       2009  

OPERATING ACTIVITIES

Net income (loss) $ 6,148 $ 1,753 $ (2,306 )
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 2,808 3,195 3,796
Amortization 912 886 1,312
(Gain) loss on equipment disposals/impaired assets 56 20 94
Gain on revaluation of ACT liability (758 ) (768 ) (781 )
Unrealized holding gain on marketable security (21 ) - -
Allowance for doubtful accounts 348 12 (10 )
Deferred income tax 793 (588 ) (1,492 )
Stock compensation expense 2,810 4,274 6,097
Changes in operating assets and liabilities:
Accounts receivable (13,279 ) (3,377 ) 5,498
Inventories 504 (354 ) 563
Prepaid expenses, other current assets and other noncurrent assets (723 ) (27 ) 3,293
Accounts payable 2,914 1,765 (2,372 )
Accrued liabilities and other noncurrent liabilities 2,346 5,379 (113 )
Other   -       20       34  
Net cash provided by operating activities 4,858 12,190 13,613
 
INVESTING ACTIVITIES
Decrease (increase) in restricted cash - 200 (200 )
Purchases of property, equipment and patents (2,408 ) (2,206 ) (2,004 )
Proceeds from the sale of equipment 2 - -
Acquisitions of businesses   -       -       (20,185 )
Net cash used in investing activities (2,406 ) (2,006 ) (22,389 )
 
FINANCING ACTIVITIES
(Payments) / proceeds from debt (1,162 ) (737 ) 737
Proceeds from exercises of stock options 376 10 605
Excess tax benefit from exercises of stock options 77 - 78
Reclassification of liability award - - - 90
Repurchases of common stock (4,111 ) - -
Other   -       (5 )     -  
Net cash (used in) provided by financing activities (4,820 ) (732 ) 1,510
 
Effect of exchange rate fluctuations on cash   73       107       82  
Net increase (decrease) in cash and cash equivalents (2,295 ) 9,559 (7,184 )
Cash and cash equivalents at beginning of year   30,524       20,965       28,149  
Cash and cash equivalents at end of year $ 28,229     $ 30,524     $ 20,965  
 
Supplemental Cash Flow Information:
Non-cash activities:
(Decrease) increase in contingent consideration payable $ (758 ) $ (768 ) $ 2,307
Cash paid for:
Interest $ 148 $ 143 $ 120
Income taxes paid $ 5,187 $ 297 $ 195
 
 

FUEL TECH, INC.

BUSINESS SEGMENT FINANCIAL DATA
(in thousands of dollars)
           

Q4 - 2011

For the three months ended December 31, 2011
Air Pollution FUEL CHEM
Control Segment   Segment   Other   Total
 
Net Sales from external customers 17,971 10,031 - 28,002
Cost of sales (10,129 )   -56.4 %   (4,659 )   -46.4 %   -     (14,788 )
Gross margin 7,842 43.6 % 5,372 53.6 % - 13,214
Selling, general and administrative - - (9,828 ) (9,828 )
Gain from revaluation of ACT liability - - - -
Research and development -         -         (399 )   (399 )
Operating Income 7,842 5,372 (10,227 ) 2,987
 

Q4 - 2010

For the three months ended December 31, 2010
Air Pollution

FUEL CHEM

 

 

Control Segment  

Segment

 

Other

 

Total

 
Net Sales from external customers 13,160 11,837 - 24,997
Cost of sales (8,985 )   -68.3 %   (5,773 )   -48.8 %   -     (14,758 )
Gross margin 4,175 31.7 % 6,064 51.2 % - 10,239
Selling, general and administrative - - (7,551 ) (7,551 )
Gain from revaluation of ACT liability - - - -
Research and development -         -         (373 )   (373 )
Operating Income 4,175 6,064 (7,924 ) 2,315
 

Q4 - 2011 YTD

For the twelve months ended December 31, 2011
Air Pollution FUEL CHEM
Control Segment   Segment   Other   Total
 
Net Sales from external customers 50,930 42,738 - 93,668
Cost of sales (28,467 )   -55.9 %   (21,390 )   -50.0 %   -     (49,857 )
Gross margin 22,463 44.1 % 21,348 50.0 % - 43,811
Selling, general and administrative - - (33,446 ) (33,446 )
Gain from revaluation of ACT liability - - 758 758
Research and development -         -         (1,474 )   (1,474 )
Operating Income 22,463 21,348 (34,162 ) 9,649
 

Q4 - 2010 YTD

For the twelve months ended December 31, 2010
Air Pollution FUEL CHEM
Control Segment   Segment   Other   Total
 
Net Sales from external customers 40,917 40,878 - 81,795
Cost of sales (27,024 )   -66.0 %   (19,797 )   -48.4 %   -     (46,821 )
Gross margin 13,893 34.0 % 21,081 51.6 % - 34,974
Selling, general and administrative - - (30,857 ) (30,857 )
Gain from revaluation of ACT liability - - 768 768
Research and development -         -         (948 )   (948 )
Operating Income 13,893 21,081 (31,037 ) 3,937
 

Note: Fuel Tech is an integrated company that segregates its financial results into two reportable segments, both providing advanced technology and engineering solutions for the optimization of combustion systems in utility and industrial applications. The “Other” classification includes those profit and loss items not allocated by Fuel Tech to each reportable segment.

 
FUEL TECH, INC.

GEOGRAPHIC INFORMATION

(in thousands of dollars)

 

For the years ended December 31,

2011   2010   2009
   
Revenues:
United States $ 76,077 $ 69,002 $ 55,395
Foreign   17,591     12,793     16,002
$ 93,668   $ 81,795   $ 71,397
 
As of December 31,

 

2011

  2010   2009
Assets:
United States $ 99,601 $ 92,485 $ 82,261
Foreign   13,389     10,718     10,001
$ 112,990   $ 103,203   $ 92,262
 
   
FUEL TECH, INC.

RECONCILIATION OF GAAP NET INCOME TO EBITDA AND ADJUSTED EBITDA

(in thousands of dollars)

 
Three Months Ended Twelve Months Ended
2011   2010 2011   2010

Net income

$ 1,724 $ 1,031 $ 6,148 $ 1,753
Interest expense 23 33 148 143
Income tax expense 1,229 1,306 3,109 1,933
Depreciation expense 557 755 2,808 3,195
Amortization expense   235   221   912   886

EBITDA

3,768 3,346 13,125 7,910
Stock compensation expense   613   484   2,810   4,179

ADJUSTED EBITDA

$ 4,381 $ 3,830 $ 15,935 $ 12,089
 

Adjusted EBITDA

To supplement the Company’s consolidated financial statements presented in accordance with generally accepted accounting principles in the United States (GAAP), the Company has provided an Adjusted EBITDA disclosure as a measure of financial performance. Adjusted EBITDA is defined as net income (loss) before interest expense, income tax expense (benefit), depreciation expense, amortization expense and stock compensation expense. The Company’s reference to these non-GAAP measures should be considered in addition to results prepared in accordance with GAAP standards, but are not a substitute for, or superior to, GAAP results.

6 of 7

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs