Hudson Technologies, Inc. (NASDAQ:HDSN), announced results for the quarter and nine months ended September 30, 2013.
Revenues for the three months ended September 30, 2013 increased 5% to $15.2 million from $14.5 million in the comparable 2012 period.
During the third quarter of 2013, the Company recorded a lower-of-cost-or-market inventory adjustment (“LCM inventory adjustment”) of $14.7 million. This LCM inventory adjustment, which significantly increased our cost of sales, was due to an approximately 50% decline in R-22 pricing from March to September 2013 following the issuance of the EPA’s final rule in April 2013 which permitted higher than expected virgin R-22 allowances for 2013 and 2014. With the inclusion of the $14.7 million LCM inventory adjustment, Hudson’s third quarter 2013 operating loss was $14.4 million, as compared to operating income of $3.7 million in the same quarter of 2012. Net loss for the third quarter of 2013, including the $14.7 million LCM inventory adjustment, was $9.1 million, or a loss of $0.36 per basic and diluted share, compared to net income of $2.2 million, or $0.09 per basic share and $0.08 per diluted share, for the third quarter of 2012. Excluding this LCM inventory adjustment for the third quarter 2013, the Company achieved third quarter non-GAAP gross profit, as defined in the tables below, of $2.1 million and non-GAAP operating income, as defined in the tables below, of $254,000.
For the nine months ended September 30, 2013, revenues increased 4% to $53.8 million as compared to revenues of $51.6 million in the first nine months of 2012. With the inclusion of the $14.7 million LCM inventory adjustment, Hudson’s operating loss was $6.3 million in the first nine months of 2013, as compared to operating income of $16.4 million in the same period last year. In the nine months ended September 30, 2013, the Company reported a net loss, including the LCM inventory adjustment, of $4.3 million, or a loss of $0.17 per basic and diluted share, as compared to net income of $9.8 million, or $0.41 per basic share and $0.37 per diluted share, in the comparable period of 2012. Excluding the $14.7 million LCM inventory adjustment, for the nine months ended September 30, 2013, as defined in the tables below, the Company achieved non-GAAP gross profit of $13.8 million and non-GAAP operating income of $8.4 million.
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