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DALLAS, Sept. 5, 2013 (GLOBE NEWSWIRE) -- PMFG, Inc. (the "Company") (Nasdaq:PMFG) today reported financial results for the fourth quarter and fiscal year ended June 29, 2013.
Fourth Quarter Fiscal Year 2013 Compared to Fourth Quarter Fiscal Year 2012
Revenue in the fourth quarter of fiscal 2013 increased $1.5 million, or 4.5%, to $34.5 million as higher revenue in the Environmental Systems segment was offset by lower revenue from the Process Products segment.
Gross profit increased in the quarter by $3.2 million, or 32.6%, to $13.1 million, on higher revenue and an improvement in the profitability of projects completed or underway in the quarter when compared to the prior year. Gross profit also was positively impacted by customer cancellation of certain contracts in Latin America. The contract cancellations contributed approximately $1.6 million to gross profit during the quarter. Cancellation of the contracts resulted from a customer's decision to redesign a planned natural gas production facility in Latin America and make changes to construction resources. The timing of contract awards related to the new facility design has not yet been announced by the customer. Gross profit as a percent of revenue improved to 38.1% from 30.0% in the year.
In July 2010, the Company entered into the CEFCO Process Manufacturing License Agreement (the "License Agreement") with CEFCO Global Clean Energy, LLC ("CEFCO"). Pursuant to the License Agreement, the Company was granted exclusive rights to manufacture equipment and process units incorporating CEFCO's multi-stage apparatus used in the selective capture and removal of pollutants and greenhouse gasses on units installed in the continental United States. The License Agreement expires 10 years from the initial commercial sale of a CEFCO unit, which has not yet occurred.
As a result of delays in CEFCO's ability to obtain financing to complete additional system design and testing, ability to identify and obtain funding for a pilot location utilizing the CEFCO technology, and uncertainties related to the future demand for clean coal technology applications, management concluded that it is no longer probable that the future cash flow from the CEFCO Licensing Agreement will exceed the amounts deferred by the Company to date. Accordingly, a non-cash impairment charge of $3.5 million was recognized during the quarter to write off all amounts previously advanced under the License Agreement.