Calgon Carbon Announces Full Year And Fourth Quarter Results

Calgon Carbon Corporation (NYSE: CCC) announced results for the full-year and fourth quarter ended December 31, 2011.

For the year ended December 31, 2011, the company reported net income of $39.2 million, a 12.6% increase over net income for the comparable period in 2010. Earnings per common share on a fully diluted basis were $0.69 for the year ended December 31, 2011, as compared to $0.61 per common share for the year ended December 31, 2010.

Net sales for the year ended December 31, 2011, were $541.5 million, an increase of 12.3% over the comparable period in 2010. The increase from Calgon Carbon Japan’s (CCJ) first quarter 2011 sales was $17.9 million. CCJ was not reported on a consolidated basis until March 31, 2010. For the year, foreign currency translation had a $13.9 million positive impact on sales due to the weaker U.S. dollar.

Net income for the fourth quarter of 2011 was $4.9 million, or $0.09 per common share, on a fully diluted basis, versus $12.5 million, or $0.22 per common share, on a fully diluted basis for the fourth quarter of 2010.

Net sales for the fourth quarter of 2011 were $138.2 million, an increase of 5.1% versus fourth quarter 2010 sales of $131.5 million. Currency translation had a $1.3 million positive impact on sales for the fourth quarter of 2011, all of which were related to CCJ’s sales.

For the fourth quarter of 2011, sales for the Activated Carbon and Service segment were $122.0 million versus $116.9 million for the fourth quarter of 2010, a 4.4% increase. CCJ’s sales for the fourth quarter accounted for $22.4 million, which represents a $3.9 million increase over the comparable period of 2010.

Excluding CCJ’s contribution, sales growth for the fourth quarter of 2011 was attributed to higher prices for activated carbon products and services in the U. S. and Europe. In those two regions, sales increased in the wastewater, food, and environmental air markets versus the fourth quarter of 2010. These increases were, for the most part, offset by a decline in sales to the respirator and potable water markets.

Equipment sales increased by 10.3% versus the fourth quarter of 2010. The growth in this segment was due solely to the company’s UV businesses, especially Hyde Marine, and was partially offset by weak demand for carbon adsorption equipment.

In the Consumer segment, sales of activated carbon cloth offset the effect of the final disposition of the company’s former PreZerve product line.

Net sales less the cost of products sold as a percentage of net sales for the fourth quarter of 2011 was 30.9%, versus 33.0% for the fourth quarter of 2010. Sales of low-margin outsourced products, particularly at CCJ, as well as expenses related to equipment failures during the start-up of the company’s new reactivation facilities in Europe and China, had an adverse impact on margins in the fourth quarter of 2011.

Selling, administrative and research expenses for the fourth quarter of 2011 were $5.4 million higher than for the comparable period of 2010. The increase was primarily due to $2.2 million in severance expense related to management changes in Europe and Asia; testing costs associated with advanced products for mercury removal; and staff additions at Hyde Marine.

Calgon Carbon’s board of directors did not declare a quarterly dividend.

Commenting on the results, John Stanik, Calgon Carbon’s chairman, president and chief executive officer, said, “After three quarters of solid performance, the fourth quarter proved to be quite challenging. Fortunately, most of the problems were temporary and are being resolved.”

“For the long term, our outlook and our strategy have not changed, and I am confident that our new organization will better allow us to capitalize on our growth opportunities. We will continue to look to ballast water treatment, reactivation services, disinfection by-products, and mercury removal for sustained growth throughout the decade.”

For more information about Calgon Carbon’s leading activated carbon and ultraviolet technology solutions for municipalities and industries, visit www.calgoncarbon.com.

Calgon Carbon Corporation, headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making water and air safer and cleaner.

This news release contains historical information and forward-looking statements. Forward-looking statements typically contain words such as “expect,” “believe,” “estimate,” “anticipate,” or similar words indicating that future outcomes are uncertain. Statements looking forward in time, including statements regarding future growth and profitability, price increases, cost savings, broader product lines, enhanced competitive posture and acquisitions, are included in the company’s most recent Annual Report pursuant to the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995. They involve known and unknown risks and uncertainties that may cause the company’s actual results in future periods to be materially different from any future performance suggested herein. Further, the company operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond the company’s control. Some of the factors that could affect future performance of the company are higher energy and raw material costs, costs of imports and related tariffs, labor relations, capital and environmental requirements, changes in foreign currency exchange rates, borrowing restrictions, validity of patents and other intellectual property, and pension costs. In the context of the forward-looking information provided in this news release, please refer to the discussions of risk factors and other information detailed in, as well as the other information contained in the company’s most recent Annual Report.

Calgon Carbon Corporation
Condensed Consolidated Statement of Income
(Dollars in thousands except per share data)
(Unaudited)        
Quarter Ended Twelve Months Ended
December 31, December 31,
2011 2010 2011 2010
 
Net Sales $ 138,200   $ 131,469   $ 541,472   $ 482,341  
 
Cost of Products Sold 95,501 88,139 364,384 316,884
 
Depreciation and Amortization 7,015 6,253 24,337 22,082
 
Selling, Administrative & Research 27,015 21,574 95,856 85,071
 
Environmental and Litigation Contingencies   420     500     (337 )   12,000  
 
  129,951     116,466     484,240     436,037  
 
Income from Operations 8,249 15,003 57,232 46,304
 
Interest - Net 160 233 467 323
 
Gain on Acquisitions - - - 2,666
 
Other Expense - Net   (818 )   (210 )   (1,309 )   (1,395 )
 

Income From Operations Before Income Tax and Equity in Income from Equity Investments
7,591 15,026 56,390 47,898
 
Income Tax Provision   2,650     2,520     17,166     13,160  
 

Income from Operations Before Equity in Income from Equity Investments
4,941 12,506 39,224 34,738
 
Equity in Income from Equity Investments   -     -     -     112  
 
Net Income $ 4,941   $ 12,506   $ 39,224   $ 34,850  
 
Net Income per Common Share
Basic $ .09 $ .22 $ .70 $ .62
 
Diluted $ .09 $ .22 $ .69 $ .61
 

Weighted Average Shares Outstanding (Thousands)
Basic 56,381 56,020 56,243 55,867
 
Diluted 57,032 56,816 56,994 56,742
 
 
Calgon Carbon Corporation
       
 

Segment Data:
 

Segment Sales
4Q11 4Q10 YTD 2011 YTD 2010
 
Activated Carbon and Service 122,046 116,879 486,468 427,713
Equipment 13,913 12,615 46,274 46,010
Consumer   2,241     1,975     8,730     8,618  
 
Total Sales (thousands) $ 138,200 $ 131,469 $ 541,472 $ 482,341
 
Segment

Operating Income (loss)*
4Q11 4Q10 YTD 2011 YTD 2010
 
Activated Carbon and Service 16,351 23,446 85,990 69,584
Equipment (629 ) 1,112 (2,172 ) 1,990
Consumer   (458 )   (3,302 )   (2,249 )   (3,188 )
 
Income from Operations (thousands) $ 15,264 $ 21,256 $ 81,569 $ 68,386
 

*Before depreciation and amortization. The 2011 year includes $2.2 million of charges related to the former PreZerve product line in the Consumer segment. The 2010 year for the Activated Carbon and Service segment includes charges of $12.0 million related to environmental and litigation and contingencies.
 
Calgon Carbon Corporation
Condensed Consolidated Balance Sheet
(Dollars in thousands)
(Unaudited)    
 
December 31, December 31,
2011 2010
 
Assets
 
Current assets:
 
Cash and cash equivalents $ 13,574 $ 33,992
 
Restricted cash 1,152 1,173
 
Receivables 102,540 94,354
 
Inventories 118,348 101,693
 
Other current assets   42,327   40,836
 
Total current assets 277,941 272,048
 
Property, plant and equipment, net 234,549 186,834
 
Other assets   40,500   42,681
 
Total assets $ 552,990 $ 501,563
 
Liabilities and Shareholders' Equity
 
Current liabilities:
 
Short-term debt $ 22,894 $ 21,442
 
Current portion of long-term debt 3,372 3,203
 
Other current liabilities   89,721   80,529
 
Total current liabilities 115,987 105,174
 
Long-term debt 1,103 3,721
 
Other liabilities   58,783   49,430
 
Total liabilities 175,873 158,325
 
Redeemable non-controlling interest - 274
 
Total shareholders' equity   377,117   342,964
 
Total liabilities and shareholders' equity $ 552,990 $ 501,563

Copyright Business Wire 2010

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