Our website uses cookies, including third parties’ profiling cookies, to improve your user experience. You can learn more about how we use cookies and how to change your cookies settings in our Política de Privacidade. By closing this message, clicking above or continuing to use this site, you consent to our use of cookies.
Calgon Carbon Announces Second Quarter Results
PITTSBURGH, PA – 07/30/2002
Calgon Carbon Corporation (NYSE: CCC) announced results for the second quarter ended June 30, 2002.
Second quarter sales were $67.5 million, a decrease of $7.4 million, or 10%, as compared to the second quarter of 2001. Net income for the quarter was $1.9 million, a decline of 50%, versus the second quarter of 2001. Earnings per share were $0.05 for the second quarter, in line with company guidance provided on June 24. Earnings per share for the second quarter of 2001 were $0.10.
Sales of activated carbon declined by 16% due to the number of municipalities ordering carbon for drinking water treatment. Service sales were down slightly from the second quarter of 2001, but were beginning to rebound with the economic recovery. Engineered Solutions sales declined by 26%. However, the current order backlog of this segment is at near-record levels, and should have a positive effect on sales throughout the remainder of the year. Consumer sales of $8.5 million increased 18% over the second quarter of 2001 due to higher demand for carbon cloth and our PreZerve™ and Purrfectly Fresh™ products.
Expenses related to the start-up of a major Engineered Solutions installation and the company’s new activated carbon manufacturing plant in China had an adverse effect of approximately $1.0 million on net income in the second quarter. However, sales of higher margin carbon and effective control of operating expenses had a positive effect. Operating expenses declined 6% as compared to the second quarter of 2001.
Calgon Carbon also completed its implementation of the impairment test for goodwill as required by Statement of Financial Accounting Standards 142, “Goodwill and Other Intangible Assets.” As a result, the company has recorded an after-tax $30.9-million cumulative effect of accounting change as of January 1, 2002 for impairment of certain goodwill related to the Advanced Separation Technologies acquisition in 1996.
Sales for the six months ended June 30, 2002 were $130.6 million, a decrease of 8% versus the comparable period in 2001. For the first half, the company reported a net loss of $27.6 million, including the after tax effect of the goodwill write off of $30.9 million. Net income excluding the effect of the goodwill write off was $3.3 million versus $6.2 million last year, a 46% decline. Diluted earnings per share before the cumulative effect of accounting change were $0.08 versus $0.16 for the first half of 2001.
Calgon Carbon’s board of directors declared a dividend of $0.03 per common share. Dividends will be issued to shareholders of record as of August 12, 2002, and will be payable on September 4, 2002.
Commenting on activity in the second quarter, Jim Cederna, Calgon Carbon’s chairman and chief executive officer, said, “Our short-term results suffered from a slow global economy and major expenditures made by each of our four platforms in implementing the company’s long-term strategy. We started-up our new manufacturing plant in China, which will help to secure Calgon Carbon’s global leadership position in activated carbon, and will accelerate our growth in Asia. We launched our Service Center of Excellence project on the U.S. Gulf Coast to expand carbon reactivation and related services in that region. Engineered Solutions margins were hurt by the development costs that are necessary to operate new technologies on a large scale. We also incurred costs to sign the first licenses and to further strengthen our patent position for disinfection of drinking water using ultra violet light. We continued to build the PreZerve™ brand through our partnership with QVC. And, we completed our negotiations to form a joint venture with Mitsubishi Chemical to grow our activated carbon and service businesses in Japan.”
Mr. Cederna continued, “Several of these second quarter achievements should have a positive impact on results for the remainder of this year. The uncertain global economy makes it difficult to estimate results for all of 2002. However, we expect our second-half results to be better than the first half.”
Calgon Carbon Corporation, headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making air and water cleaner and safer. The company employs approximately 1,000 people at 13 operating facilities and 11 sales and service centers worldwide.
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. This document contains certain statements that are forward-looking relative to the company’s future strategy and performance. 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 in this document. Further, the company operates in an industry where it may be influenced by economic and other factors beyond the company’s control.
###
Calgon Carbon Corporation Condensed Consolidated Statement of Income (Dollars in thousands except per share data) (Unaudited)
| Quarter Ended | Six Months Ended | |||||||
| June 30, 2002 | June 30, 2001 | June 30, 2002 | June 30, 2001 | |||||
|
|
||||||||
| Net Sales | $ 67,484 | $ 74,899 | $ 130,620 | $ 141,817 | ||||
|
|
||||||||
| Cost of Products Sold | 46,382 | 49,805 | 89,925 | 93,181 | ||||
| Depreciation and Amortization | 4,629 | 4,967 | 9,243 | 9,974 | ||||
| Selling, Administrative & Research | 12,601 | 13,365 | 24,507 | 26,163 | ||||
|
|
||||||||
| 63,612 | 68,137 | 123,675 | 129,318 | |||||
|
|
||||||||
| Income from Operations | 3,872 | 6,762 | 6,945 | 12,499 | ||||
| Interest Income (Expense) – Net | (527) | (957) | (1,040) | (2,041) | ||||
| Other Income (Expense) – Net | (324) | 233 | (702) | (691) | ||||
|
|
||||||||
Income Before Income
|
3,021 | 6,038 | 5,203 | 9,767 | ||||
| Provision for Income Taxes | 1,087 | 2,174 | 1,873 | 3,516 | ||||
|
|
||||||||
| Income Before Minority Interest | 1,934 | 3,864 | 3,330 | 6,251 | ||||
| Minority Interest | – | – | – | (53) | ||||
|
|
||||||||
Income Before Cumulative
|
1,934 | 3,864 | 3,330 | 6,198 | ||||
Cumulative Effect of
|
– | – | (30,926) | – | ||||
|
|
||||||||
| Net Income | $ 1,934 | $ 3,864 | ($ 27,596) | $ 6,198 | ||||
|
|
||||||||
Net Income per Common Share
|
||||||||
|
$ .05 | $ .10 | $ .09 | $ .16 | ||||
|
$ .05 | $ .10 | $ .08 | $ .16 | ||||
Cumulative Effect of Accounting
|
||||||||
|
– | – | ($ .79) | – | ||||
|
– | – | ($ .79) | – | ||||
Adjusted Net Income
|
||||||||
|
$ .05 | $ .10 | ($ .71) | $ .16 | ||||
|
$ .05 | $ .10 | ($ .70) | $ .16 | ||||
|
|
||||||||
Weighted Average Shares
|
||||||||
|
38,940 | 38,802 | 38,802 | 38,802 | ||||
|
39,364 | 39,138 | 39,049 | 39,049 | ||||
Calgon Carbon Corporation Condensed Consolidated Balance Sheet (Dollars in thousands)
| June 30, 2002 | December 31, 2001 | |
|
|
||
| ASSETS | ||
|
|
||
| Current assets: | ||
| Cash and cash equivalents | $ 5,110 | $ 3,567 |
| Receivables | 47,595 | 44,233 |
| Inventories | 45,952 | 42,104 |
| Other current assets | 10,420 | 14,631 |
|
|
||
| Total current assets | 109,077 | 104,535 |
| Property, plant and equipment, net | 144,628 | 143,661 |
| Other assets | 33,071 | 83,518 |
|
|
||
| Total assets | $ 286,776 | $ 331,714 |
|
|
||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||
|
|
||
| Current liabilities: | ||
| Short-term debt | $ – | $ 8,762 |
| Long-term debt due within one year | 2,870 | 1,275 |
| Other current liabilities | 35,215 | 37,705 |
|
|
||
| Total current liabilities | 38,085 | 47,742 |
| Long-term debt | 62,804 | 54,360 |
| Other liabilities | 27,855 | 45,803 |
|
|
||
| Total liabilities | 128,744 | 147,905 |
| Total shareholders’ equity | 158,032 | 183,809 |
|
|
||
| Total liabilities and shareholders’ equity | $ 286,776 | $ 331,714 |
|
|
||
| Calgon Carbon Corporation | ||||
| Segment Data | ||||
|
|
||||
| Segment Sales | 2Q02 | 2Q01 | YTD 2002 | YTD 2001 |
|
|
||||
| Activated Carbon | $23,187 | $27,593 | $ 50,505 | $ 56,841 |
| Service | 25,125 | 25,709 | 46,798 | 47,524 |
| Engineered Solutions | 10,639 | 14,350 | 19,385 | 25,729 |
| Consumer Health | 8,533 | 7,247 | 13,482 | 11,723 |
|
|
||||
| Total Sales (thousands) | $67,484 | $74,899 | $130,620 | $141,817 |
|
|
||||
| Segment Operating Income* | 2Q02 | 2Q01 | YTD 2002 | YTD 2001 |
|
|
||||
| Activated Carbon | $ 4,497 | $ 4,924 | $ 8,424 | $ 10,082 |
| Service | 5,119 | 6,223 | 9,271 | 10,317 |
| Engineered Solutions | (1,392) | 218 | (1,706) | 1,760 |
| Consumer Health | 277 | 364 | 199 | 314 |
|
|
||||
| Total Income from Operations (thousands) |
$ 8,501 | $11,729 | $ 16,188 | $ 22,473 |
|
|
||||
| *Before depreciation, amortization, and restructuring charges | ||||
An improvement in the Company’s information reporting system in the second quarter of 2002 has allowed the Company to directly attribute standard cost variances and distribution costs to segments that were previously allocated to segments. As a result, the second quarter and June year-to-date results for 2001 have been restated to conform with the 2002 presentation.
###
For more information, please contact Gail Gerono (412) 787-6795