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Hudson Technologies, Inc. (NASDAQ:HDSN), announced results for the quarter and year ended December 31, 2013.
Revenues for the three months ended December 31, 2013 were down slightly to $4.8 million from $4.9 million in the comparable 2012 period. During the fourth quarter of 2013, the Company recorded a slightly higher sales volume from refrigerant sales offset by slightly lower services revenues when compared to the 2012 quarter. The reduction in services revenues was primarily related to timing as a few jobs started in the fourth quarter were completed early in the first quarter of 2014.
Net loss for the quarter was $1.5 million, or a loss of $0.06 per basic and diluted share, compared to net income of $3.0 million, or $0.12 per basic share and $0.11 per diluted share, for 2012. The difference between the net loss of 2013 compared to the net income in 2012 was primarily due to the Company’s recognition of a non-cash deferred tax benefit in 2012, which did not reoccur in 2013.
For the year ended December 31, 2013, revenues increased 4% to a record $58.6 million as compared to revenues of $56.4 million in 2012. 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 operating loss was $8.5 million in 2013, as compared to operating income of $14.9 million in 2012. For the year ended December 31, 2013, the Company reported a net loss, including the LCM inventory adjustment, of $5.8 million, or a loss of $0.24 per basic and diluted share, as compared to net income of $12.8 million, or $0.54 per basic share and $0.49 per diluted share, in the comparable period of 2012. Excluding the $14.7 million LCM inventory adjustment, for the year ended December 31, 2013, as defined in the tables below, the Company achieved non-GAAP gross profit of $14.0 million and non-GAAP operating income of $6.2 million.