SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
Form
10-Q
|
x |
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
o |
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
Delaware
(State
or other jurisdiction
of
incorporation or organization)
|
58-1954497
(IRS
Employer Identification Number)
|
1940
N.W. 67th Place, Gainesville, FL
(Address
of principal executive offices)
|
32653
(Zip
Code)
|
Class
Common
Stock, $.001 Par Value
|
Outstanding
at November 7, 2005
44,753,537
(excluding
988,000 shares
held
as treasury
stock)
|
PART I |
FINANCIAL
INFORMATION
|
Page
No.
|
|
Item
1.
|
Financial
Statements
|
||
Consolidated
Balance Sheets -
September
30, 2005 and December 31, 2004
|
2
|
||
Consolidated
Statements of Operations -
Three
and Nine Months Ended September 30, 2005 and 2004
|
4
|
||
Consolidated
Statements of Cash Flows -
Nine
Months Ended September 30, 2005 and 2004
|
5
|
||
Consolidated
Statement of Stockholders' Equity -
Nine
Months Ended September 30, 2005
|
6
|
||
Notes
to Consolidated Financial Statements
|
7
|
||
Item
2.
|
Management's
Discussion and Analysis of
Financial
Condition and Results of Operations
|
19
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures
About
Market Risk
|
40
|
|
Item
4.
|
Controls
and Procedures
|
41
|
|
PART
II
|
OTHER
INFORMATION
|
||
Item
1.
|
Legal
Proceedings
|
43
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
44
|
|
Item
6.
|
Exhibits
|
44
|
(Amounts
in Thousands, Except for Share Amounts)
|
September
30,
2005
(Unaudited)
|
December
31,
2004
|
|||||
ASSETS
|
|||||||
Current
assets
|
|||||||
Cash
|
$
|
119
|
$
|
215
|
|||
Restricted
cash
|
40
|
60
|
|||||
Accounts
receivable, net of allowance for doubtful accounts
of $438 and $570
|
14,995
|
17,674
|
|||||
Unbilled
Receivables
|
14,096
|
9,518
|
|||||
Inventories
|
883
|
882
|
|||||
Prepaid
expenses
|
3,731
|
2,891
|
|||||
Other
receivables
|
88
|
45
|
|||||
Current
assets of discontinued operations, net of allowance for doubtful
accounts
of $86 and $125
|
¾
|
1,609
|
|||||
Total
current assets
|
33,952
|
32,894
|
|||||
Property
and equipment:
|
|||||||
Buildings
and land
|
19,560
|
18,313
|
|||||
Equipment
|
30,959
|
30,281
|
|||||
Vehicles
|
4,486
|
4,187
|
|||||
Leasehold
improvements
|
11,489
|
11,514
|
|||||
Office
furniture and equipment
|
2,563
|
2,396
|
|||||
Construction-in-progress
|
1,307
|
1,852
|
|||||
70,364
|
68,543
|
||||||
Less
accumulated depreciation and amortization
|
(24,837
|
)
|
(21,282
|
)
|
|||
Net
property and equipment
|
45,527
|
47,261
|
|||||
Property
and equipment of discontinued operations
|
603
|
600
|
|||||
Intangibles
and other assets:
|
|||||||
Permits
|
13,186
|
12,895
|
|||||
Goodwill
|
1,330
|
1,330
|
|||||
Finite
Risk Sinking Fund
|
3,216
|
2,225
|
|||||
Other
assets
|
3,095
|
3,250
|
|||||
Total
assets
|
$
|
100,909
|
$
|
100,455
|
(Amounts
in Thousands, Except for Share Amounts)
|
September
30,
2005
(Unaudited)
|
December
31,
2004
|
|||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
Current
liabilities:
|
|||||||
Accounts
payable
|
$
|
5,753
|
$
|
6,529
|
|||
Current
environmental accrual
|
722
|
721
|
|||||
Accrued
expenses
|
12,701
|
12,100
|
|||||
Unearned
revenue
|
4,386
|
5,115
|
|||||
Current
liabilities of discontinued operations
|
2,119
|
2,550
|
|||||
Current
portion of long-term debt
|
2,766
|
6,376
|
|||||
Total
current liabilities
|
28,447
|
33,391
|
|||||
Environmental
accruals
|
1,746
|
2,141
|
|||||
Accrued
closure costs
|
5,166
|
5,062
|
|||||
Other
long-term liabilities
|
2,297
|
1,944
|
|||||
Long-term
liabilities of discontinued operations
|
1,574
|
1,804
|
|||||
Long-term
debt, less current portion
|
13,909
|
12,580
|
|||||
Total
long-term liabilities
|
24,692
|
23,531
|
|||||
Total
liabilities
|
53,139
|
56,922
|
|||||
Commitments
and Contingencies (see Notes 4 and 6)
|
¾
|
¾
|
|||||
Preferred
Stock of subsidiary, $1.00 par value; 1,467,396 shares authorized,
1,284,730 shares issued and outstanding, liquidation value $1.00
per
share
|
1,285
|
1,285
|
|||||
Stockholders'
equity:
|
|||||||
Preferred
Stock, $.001 par value; 2,000,000 shares authorized, 0 and 2,500
shares
issued and outstanding
|
¾
|
¾
|
|||||
Common
Stock, $.001 par value; 75,000,000 shares authorized, 45,673,537
and 42,749,117 shares issued, including 988,000 shares held as treasury
stock, respectively
|
46
|
43
|
|||||
Additional
paid-in capital
|
82,059
|
80,902
|
|||||
Accumulated
deficit
|
(33,752
|
)
|
(36,794
|
)
|
|||
Interest
rate swap
|
(6
|
)
|
(41
|
)
|
|||
48,347
|
44,110
|
||||||
Less:
Common Stock in treasury at cost; 988,000 shares
|
(1,862
|
)
|
(1,862
|
)
|
|||
Total
stockholders' equity
|
46,485
|
42,248
|
|||||
Total
liabilities and stockholders' equity
|
$
|
100,909
|
$
|
100,455
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
(Amounts
in Thousands, Except for Per Share Amounts)
|
2005
|
2004
|
2005
|
2004
|
|||||||||
Net
revenues
|
$
|
23,041
|
$
|
24,337
|
$
|
70,008
|
$
|
60,277
|
|||||
Cost
of goods sold
|
16,342
|
16,808
|
50,465
|
43,195
|
|||||||||
Gross
profit
|
6,699
|
7,529
|
19,543
|
17,082
|
|||||||||
Selling,
general and administrative expenses
|
4,965
|
4,443
|
15,342
|
12,975
|
|||||||||
Loss
(gain) on disposal/impairment of property and equipment
|
4
|
1,014
|
(333
|
)
|
996
|
||||||||
Impairment
loss on intangible assets
|
¾
|
7,101
|
¾
|
7,101
|
|||||||||
Income
(loss) from operations
|
1,730
|
(5,029
|
)
|
4,534
|
(3,990
|
)
|
|||||||
Other
income (expense):
|
|||||||||||||
Interest
income
|
5
|
¾
|
7
|
2
|
|||||||||
Interest
expense
|
(385
|
)
|
(294
|
)
|
(1,178
|
)
|
(1,535
|
)
|
|||||
Interest
expense-financing fees
|
(48
|
)
|
(1,566
|
)
|
(269
|
)
|
(2,079
|
)
|
|||||
Other
|
(100
|
)
|
(31
|
)
|
(159
|
)
|
(48
|
)
|
|||||
Income
(loss) from continuing operations before taxes
|
1,202
|
(6,920
|
)
|
2,935
|
(7,650
|
)
|
|||||||
Income
tax expense
|
41
|
37
|
324
|
163
|
|||||||||
Income
(loss) from continuing operations
|
1,161
|
(6,957
|
)
|
2,611
|
(7,813
|
)
|
|||||||
Discontinued
operations:
|
|||||||||||||
Income
(loss) from discontinued operations
|
860
|
(740
|
)
|
571
|
(1,765
|
)
|
|||||||
Loss
on disposals from discontinued operations
|
¾
|
(9,835
|
)
|
¾
|
(9,835
|
)
|
|||||||
Total
income (loss) from discontinued operations
|
860
|
(10,575
|
)
|
571
|
(11,600
|
)
|
|||||||
Net
income (loss)
|
2,021
|
(17,532
|
)
|
3,182
|
(19,413
|
)
|
|||||||
Preferred
Stock dividends
|
46
|
48
|
140
|
142
|
|||||||||
Net
income (loss) applicable to Common Stock
|
$
|
1,975
|
$
|
(17,580
|
)
|
$
|
3,042
|
$
|
(19,555
|
)
|
|||
Net
income (loss) per common share - basic
|
|||||||||||||
Continuing
operations
|
$
|
.03
|
$
|
(.17
|
)
|
$
|
.06
|
$
|
(.20
|
)
|
|||
Discontinued
operations
|
.02
|
(.25
|
)
|
.01
|
(.29
|
)
|
|||||||
Net
income (loss) per common share
|
$
|
.05
|
$
|
(.42
|
)
|
$
|
.07
|
$
|
(.49
|
)
|
|||
Net
income (loss) per common share - diluted
|
|||||||||||||
Continuing
operations
|
$
|
.03
|
$
|
(.17
|
)
|
$
|
.06
|
$
|
(.20
|
)
|
|||
Discontinued
operations
|
.02
|
(.25
|
)
|
.01
|
(.29
|
)
|
|||||||
Net
income (loss) per common share
|
$
|
.05
|
$
|
(.42
|
)
|
$
|
.07
|
$
|
(.49
|
)
|
|||
Number
of shares and potential common shares used in net
income (loss) per common share:
|
|||||||||||||
Basic
|
42,055
|
41,648
|
41,881
|
40,051
|
|||||||||
Diluted
|
44,152
|
41,648
|
43,138
|
40,051
|
Nine
Months Ended
September
30,
|
|||||||
(Amounts
in Thousands)
|
2005
|
2004
|
|||||
Cash
flows from operating activities
|
|||||||
Net
income (loss)
|
$
|
3,182
|
$
|
(19,413
|
)
|
||
Adjustments
to reconcile net income (loss) to cash provided by
(used
in) operations:
|
|||||||
Depreciation
and amortization
|
3,604
|
3,540
|
|||||
Debt
discount amortization
|
¾
|
838
|
|||||
Provision
for bad debt and other reserves
|
30
|
123
|
|||||
(Gain)
loss on disposal/impairment of property and equipment
|
(332
|
)
|
996
|
||||
Intangible
asset impairment
|
¾
|
7,101
|
|||||
Issuance
of Common Stock for services
|
160
|
184
|
|||||
Changes
in assets and liabilities:
|
|||||||
Accounts
receivable
|
2,649
|
(5,466
|
)
|
||||
Unbilled
Receivables
|
(4,578
|
)
|
(269
|
)
|
|||
Prepaid
expenses, inventories and other assets
|
(350
|
)
|
590
|
||||
Accounts
payable, accrued expenses, and unearned revenue
|
(1,613
|
)
|
1,668
|
||||
Discontinued
operations
|
947
|
10,135
|
|||||
Net
cash provided by operations
|
3,699
|
27
|
|||||
Cash
flows from investing activities:
|
|||||||
Purchases
of property and equipment, net
|
(1,720
|
)
|
(2,318
|
)
|
|||
Proceeds
from sale of property and equipment
|
702
|
31
|
|||||
Change
in restricted cash, net
|
15
|
(1
|
)
|
||||
Change
in finite risk sinking fund
|
(991
|
)
|
(991
|
)
|
|||
Discontinued
operations
|
(3
|
)
|
¾
|
||||
Funds
used for acquisitions (net of cash acquired)
|
¾
|
(2,903
|
)
|
||||
Net
cash used in investing activities
|
(1,997
|
)
|
(6,182
|
)
|
|||
Cash
flows from financing activities:
|
|||||||
Net
(repayments) borrowings of revolving credit
|
(1,699
|
)
|
3,168
|
||||
Principal
repayments of long-term debt
|
(5,516
|
)
|
(7,866
|
)
|
|||
Borrowings
of long-term debt
|
4,417
|
¾
|
|||||
Proceeds
from issuance of stock
|
1,000
|
10,900
|
|||||
Net
cash (used in) provided by financing activities
|
(1,798
|
)
|
6,202
|
||||
(Decrease)
increase in cash
|
(96
|
)
|
47
|
||||
Cash
at beginning of period
|
215
|
411
|
|||||
Cash
at end of period
|
$
|
119
|
$
|
458
|
|||
Supplemental
disclosure
|
|||||||
Interest
paid
|
$
|
971
|
$
|
1,629
|
|||
Non-cash
investing and financing activities:
|
|||||||
Issuance
of Common Stock for payment of dividends
|
¾
|
125
|
|||||
Gain
on interest rate swap
|
35
|
68
|
|||||
Long-term
debt incurred for purchase of property and equipment
|
517
|
184
|
Preferred
Stock
|
Common
Stock
|
|||||||||||||||||||||||||||
(Amounts
in thousands,
except
for share amounts)
|
Shares
|
Amount
|
Shares
|
Amount
|
Additional
Paid-In
Capital
|
Accumulated
Deficit
|
Interest
Rate
Swap
|
Common
Stock
Held
In
Treasury
|
Total
Stockholders'
Equity
|
|||||||||||||||||||
Balance
at December 31, 2004
|
2,500
|
$
|
¾
|
42,749,117
|
$
|
43
|
$
|
80,902
|
$
|
(36,794
|
)
|
$
|
(41
|
)
|
$
|
(1,862
|
)
|
$
|
42,248
|
|||||||||
Comprehensive
income:
|
|
|||||||||||||||||||||||||||
Net
income
|
¾
|
¾
|
¾
|
¾
|
¾
|
3,182
|
¾
|
¾
|
3,182
|
|||||||||||||||||||
Other
Comprehensive income:
|
||||||||||||||||||||||||||||
Gain
on interest rate swap
|
¾
|
¾
|
¾
|
¾
|
¾
|
¾
|
35
|
¾
|
35
|
|||||||||||||||||||
Comprehensive
income
|
3,217
|
|||||||||||||||||||||||||||
Preferred
Stock dividends
|
¾
|
¾
|
¾
|
¾
|
¾
|
(140
|
)
|
¾
|
¾
|
(140
|
)
|
|||||||||||||||||
Issuance
of Common Stock for cash and
services
|
¾
|
¾
|
684,868
|
1
|
1,159
|
¾
|
¾
|
¾
|
1,160
|
|||||||||||||||||||
Issuance
of Common Stock upon cashless
exercise of Warrants
|
¾
|
¾
|
572,885
|
¾
|
¾
|
¾
|
¾
|
¾
|
¾
|
|||||||||||||||||||
Issuance
of Common Stock uponconversion
of Preferred Stock
|
(2,500
|
)
|
¾
|
1,666,667
|
2
|
(2
|
)
|
¾
|
¾
|
¾
|
¾
|
|||||||||||||||||
Balance
at September 30, 2005
|
¾
|
$
|
¾
|
45,673,537
|
$
|
46
|
$
|
82,059
|
$
|
(33,752
|
)
|
$
|
(6
|
)
|
$
|
(1,862
|
)
|
$
|
46,485
|
1.
|
Summary
of Significant Accounting
Policies
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
2005
|
2004
|
2005
|
2004
|
||||||||||
Net
income (loss) from continuing operations applicable
to Common Stock, as reported
|
$
|
1,115
|
$
|
(7,005
|
)
|
$
|
2,471
|
$
|
(7,955
|
)
|
|||
Deduct:
Total Stock-based employee compensation
expense determined under fair value based method for all awards,
net of
related tax effects
|
523
|
97
|
688
|
270
|
|||||||||
Pro
forma net income (loss) from continuing operations
applicable to Common Stock
|
$
|
592
|
$
|
(7,102
|
)
|
$
|
1,783
|
$
|
(8,225
|
)
|
|||
Income
(loss) per share:
|
|||||||||||||
Basic
- as reported
|
$
|
.03
|
$
|
(.17
|
)
|
$
|
.06
|
$
|
(.20
|
)
|
|||
Basic
- pro-forma
|
$
|
.01
|
$
|
(.17
|
)
|
$
|
.04
|
$
|
(.20
|
)
|
|||
Diluted
- as reported
|
$
|
.03
|
$
|
(.17
|
)
|
$
|
.06
|
$
|
(.20
|
)
|
|||
Diluted
- pro-forma
|
$
|
.01
|
$
|
(.17
|
)
|
$
|
.04
|
$
|
(.20
|
)
|
2.
|
Earnings
Per Share
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
(Amounts
in thousands except per share amounts)
|
2005
|
2004
|
2005
|
2004
|
|||||||||
Earnings
per share from continuing operations
|
|||||||||||||
Income
(loss) from continuing operations
|
$
|
1,161
|
$
|
(6,957
|
)
|
$
|
2,611
|
$
|
(7,813
|
)
|
|||
Preferred
stock dividends
|
(46
|
)
|
(48
|
)
|
(140
|
)
|
(142
|
)
|
|||||
Income
(loss) from continuing operations applicable to Common
Stock
|
1,115
|
(7,005
|
)
|
2,471
|
(7,955
|
)
|
|||||||
Effect
of dilutive securities:
|
|||||||||||||
Preferred
Stock dividends
|
46
|
¾
|
140
|
¾
|
|||||||||
Income
(loss) - diluted
|
$
|
1,161
|
$
|
(7,005
|
)
|
$
|
2,611
|
$
|
(7,955
|
)
|
|||
Basic
income (loss) per share
|
$
|
.03
|
$
|
(.17
|
)
|
$
|
.06
|
$
|
(.20
|
)
|
|||
Diluted
income (loss) per share
|
$
|
.03
|
$
|
(.17
|
)
|
$
|
.06
|
$
|
(.20
|
)
|
|||
Earnings
per share from discontinued operations
|
|||||||||||||
Income
(loss) - basic and diluted
|
$
|
860
|
$
|
(10,575
|
)
|
$
|
571
|
$
|
(11,600
|
)
|
|||
Basic
loss per share
|
$
|
.02
|
$
|
(.25
|
)
|
$
|
.01
|
$
|
(.29
|
)
|
|||
Diluted
loss per share
|
$
|
.02
|
$
|
(.25
|
)
|
$
|
.01
|
$
|
(.29
|
)
|
|||
Weighted
average shares outstanding - basic
|
42,055
|
41,648
|
41,881
|
40,051
|
|||||||||
Potential
shares exercisable under stock option plans
|
404
|
¾
|
288
|
¾
|
|||||||||
Potential
shares upon exercise of Warrants
|
1,693
|
¾
|
969
|
¾
|
|||||||||
Weighted
average shares outstanding - diluted
|
44,152
|
41,648
|
43,138
|
40,051
|
|||||||||
Potential
shares excluded from above weighted average share
calculations due to their anti-dilutive effect include:
|
|||||||||||||
Upon
exercise of options
|
1,082
|
2,932
|
1,317
|
2,932
|
|||||||||
Upon
exercise of Warrants
|
1,776
|
12,791
|
1,776
|
12,791
|
|||||||||
Upon
conversion of Preferred Stock
|
¾
|
1,667
|
¾
|
1,667
|
3.
|
Long
Term Debt
|
Revolving
Credit
facility dated December 22, 2000, borrowings based upon eligible
accounts
receivable, subject to monthly borrowing base calculation, variable
interest paid monthly at prime rate plus ½% (7.25% at September 30, 2005),
balance due in May 2008.
|
$
|
4,781
|
$
|
6,480
|
|||
Term
Loan
dated December 22, 2000, payable in equal monthly installments of
principal of $83, balance due in May 2008, variable interest paid
monthly
at prime rate plus 1% (7.75% at September 30, 2005).
|
6,750
|
3,083
|
|||||
Unsecured
Promissory Note dated
August 31, 2000, payable in August 2005, interest paid annually at
7.0%.
Paid in full in June 2005.
|
¾
|
3,500
|
|||||
Promissory
Note dated
June 25, 2001, payable in semiannual installments on June 30 and
December
31 through December 31, 2008, variable interest accrues at the applicable
law rate determined under the IRS Code Section (9.0% on September
30,
2005) and is payable in one lump sum at the end of installment
period.
|
2,634
|
3,034
|
|||||
Installment
Agreement
dated June 25, 2001, payable in semiannual installments on June 30
and
December 31 through December 31, 2008, variable interest accrues
at the
applicable law rate determined under the IRS Code Section (9.0% on
September 30, 2005) and is payable in one lump sum at the end of
installment period.
|
653
|
753
|
|||||
Various
capital lease and promissory note obligations, payable 2005 to 2010,
interest at rates ranging from 5.0% to 14.2%.
|
1,857
|
2,106
|
|||||
16,675
|
18,956
|
||||||
Less
current portion of long-term debt
|
2,766
|
6,376
|
|||||
$
|
13,909
|
$
|
12,580
|
4.
|
Commitments
and Contingencies
|
5.
|
Acquisitions
|
6.
|
Discontinued
Operations
|
7.
|
Preferred
Stock
|
8.
|
Operating
Segments
|
·
|
from
which we may earn revenue and incur expenses;
|
·
|
whose
operating results are regularly reviewed by the segment president
to make
decisions about resources to be allocated to the segment and assess
its
performance; and
|
·
|
for
which discrete financial information is
available.
|
Segment
Reporting for the Quarter Ended September 30,
2005
|
|||||||||||||||||||
Industrial
|
Nuclear
|
Engineering
|
Segments
Total
|
Corporate
(2)
|
Consolidated
Total
|
||||||||||||||
Revenue
from external customers
|
$
|
11,098
|
$
|
11,260(3)
|
|
$
|
683
|
$
|
23,041
|
$
|
¾
|
$
|
23,041
|
||||||
Intercompany
revenues
|
560
|
572
|
131
|
1,263
|
¾
|
1,263
|
|||||||||||||
Gross
profit
|
2,350
|
4,164
|
185
|
6,699
|
¾
|
6,699
|
|||||||||||||
Interest
income
|
4
|
1
|
¾
|
5
|
¾
|
5
|
|||||||||||||
Interest
expense
|
21
|
202
|
5
|
228
|
157
|
385
|
|||||||||||||
Interest
expense-financing fees
|
¾
|
¾
|
¾
|
¾
|
48
|
48
|
|||||||||||||
Depreciation
and amortization
|
479
|
701
|
10
|
1,190
|
11
|
1,201
|
|||||||||||||
Segment
profit
|
361
|
2,061
|
61
|
2,483
|
(1,322
|
)
|
1,161
|
||||||||||||
Segment
assets(1)
|
25,321
|
63,671
|
2,136
|
91,128
|
9,781(4)
|
|
100,909
|
||||||||||||
Expenditures
for segment assets
|
289
|
375
|
5
|
669
|
3(4)
|
|
672
|
||||||||||||
Total
long-term debt
|
1,319
|
3,800
|
25
|
5,144
|
11,531(5)
|
|
16,675
|
Segment
Reporting for the Quarter Ended September 30,
2004
|
|||||||||||||||||||
Industrial
|
Nuclear
|
Engineering
|
Segments
Total
|
Corporate
(2)
|
Consolidated
Total
|
||||||||||||||
Revenue
from external customers
|
$
|
10,606
|
$
|
12,886(3)
|
|
$
|
845
|
$
|
24,337
|
$
|
¾
|
$
|
24,337
|
||||||
Intercompany
revenues
|
734
|
917
|
96
|
1,747
|
¾
|
1,747
|
|||||||||||||
Gross
profit
|
1,573
|
5,749
|
207
|
7,529
|
¾
|
7,529
|
|||||||||||||
Interest
income
|
¾
|
¾
|
¾
|
¾
|
¾
|
¾
|
|||||||||||||
Interest
expense
|
199
|
102
|
¾
|
301
|
(7
|
)
|
294
|
||||||||||||
Interest
expense-financing fees
|
¾
|
191
|
¾
|
191
|
1,375
|
1,566
|
|||||||||||||
Depreciation
and amortization
|
524
|
670
|
7
|
1,201
|
10
|
1,211
|
|||||||||||||
Segment
profit (loss)
|
(8,648
|
)
|
3,904
|
113
|
(4,631
|
)
|
(2,326
|
)
|
(6,957
|
)
|
|||||||||
Segment
assets(1)
|
29,556
|
64,760
|
2,125
|
96,441
|
9,869(4)
|
106,310
|
|||||||||||||
Expenditures
for segment assets
|
189
|
254
|
¾
|
443
|
6
|
449
|
|||||||||||||
Total
long-term debt
|
1,579
|
8,064
|
32
|
9,675
|
15,737(5)
|
|
25,412
|
Segment
Reporting for the Nine Months Ended September 30,
2005
|
|||||||||||||||||||
Industrial
|
Nuclear
|
Engineering
|
Segments
Total
|
Corporate
(2)
|
Consolidated
Total
|
||||||||||||||
Revenue
from external customers
|
$
|
31,900
|
$
|
35,963(3)
|
|
$
|
2,145
|
$
|
70,008
|
$
|
¾
|
$
|
70,008
|
||||||
Intercompany
revenues
|
1,799
|
2,012
|
353
|
4,164
|
¾
|
4,164
|
|||||||||||||
Gross
profit
|
5,109
|
13,951
|
483
|
19,543
|
¾
|
19,543
|
|||||||||||||
Interest
income
|
6
|
1
|
¾
|
7
|
¾
|
7
|
|||||||||||||
Interest
expense
|
385
|
549
|
11
|
945
|
233
|
1,178
|
|||||||||||||
Interest
expense-financing fees
|
¾
|
1
|
¾
|
1
|
268
|
269
|
|||||||||||||
Depreciation
and amortization
|
1,452
|
2,090
|
30
|
3,572
|
32
|
3,604
|
|||||||||||||
Segment
profit (loss)
|
(887
|
)
|
7,711
|
134
|
6,958
|
(4,347
|
)
|
2,611
|
|||||||||||
Segment
assets(1)
|
25,321
|
63,671
|
2,136
|
91,128
|
9,781(4)
|
|
100,909
|
||||||||||||
Expenditures
for segment assets
|
949
|
1,249
|
15
|
2,213
|
27(4)
|
|
2,240
|
||||||||||||
Total
long-term debt
|
1,319
|
3,800
|
25
|
5,144
|
11,531(5)
|
|
16,675
|
Segment
Reporting for the Nine Months Ended September 30,
2004
|
|||||||||||||||||||
Industrial
|
Nuclear
|
Engineering
|
Segments
Total
|
Corporate
(2)
|
Consolidated
Total
|
||||||||||||||
Revenue
from external customers
|
$
|
27,005
|
$
|
30,871(3)
|
|
$
|
2,401
|
$
|
60,277
|
$
|
¾
|
$
|
60,277
|
||||||
Intercompany
revenues
|
1,782
|
2,766
|
316
|
4,864
|
¾
|
4,864
|
|||||||||||||
Gross
profit
|
4,167
|
12,272
|
643
|
17,082
|
¾
|
17,082
|
|||||||||||||
Interest
income
|
2
|
¾
|
¾
|
2
|
¾
|
2
|
|||||||||||||
Interest
expense
|
544
|
971
|
¾
|
1,515
|
20
|
1,535
|
|||||||||||||
Interest
expense-financing fees
|
¾
|
192
|
¾
|
192
|
1,887
|
2,079
|
|||||||||||||
Depreciation
and amortization
|
1,516
|
1,978
|
21
|
3,515
|
25
|
3,540
|
|||||||||||||
Segment
profit (loss)
|
(9,876
|
)
|
6,503
|
306
|
(3,067
|
)
|
(4,746
|
)
|
(7,813
|
)
|
|||||||||
Segment
assets(1)
|
29,556
|
64,760
|
2,125
|
96,441
|
9,869(4)
|
|
106,310
|
||||||||||||
Expenditures
for segment assets
|
644
|
1,783
|
17
|
2,444
|
58
|
2,502
|
|||||||||||||
Total
long-term debt
|
1,579
|
8,064
|
32
|
9,675
|
15,737(5)
|
|
25,412
|
(1) | Segment assets have been adjusted for intercompany accounts to reflect actual assets for each segment. |
(2) | Amounts reflect the activity for corporate headquarters not included in the segment information. |
(3)
|
The
consolidated revenues within the Nuclear segment include the Bechtel
Jacobs revenues for the quarter and nine months ended September
30, 2005,
which total $4,951,000 or 21.5% and $11,358,000 or 16.2% of total
revenue
and $2,627,000 or 10.8% and $6,752,000 or 11.2% for the same periods
in
2004.
|
(4)
|
Segment
assets include assets from Perma-Fix of Michigan, Inc., ("PFMI")
a
discontinued operation from the Industrial segment, of approximately
$603,000 and $1,416,000 as of September 30, 2005 and 2004, respectively.
Expenditures for segment assets include expenditures from PFMI of
$3,000
for the three and nine months ended September 30,
2005.
|
(5)
|
Includes
the balance outstanding from our revolving line of credit and term
loan,
which is utilized by all of our
segments.
|
·
|
improve
our operations and liquidity;
|
·
|
anticipated
improvement in the financial performance of the
Company;
|
·
|
ability
to comply with the Company's general working capital requirements;
|
·
|
ability
to be able to continue to borrow under the Company's revolving line
of
credit;
|
·
|
ability
to generate sufficient cash flow from operations to fund all costs
of
operations and remediation of certain formerly leased property in
Dayton,
Ohio, and the Company's facilities in Memphis, Tennessee; Detroit,
Michigan; Valdosta, Georgia; Ft. Lauderdale, Florida; and Tulsa,
Oklahoma;
|
·
|
ability
to remediate certain contaminated sites for projected
amounts;
|
·
|
ability
to fund budgeted capital expenditures during 2005;
|
·
|
increasing
other sources of revenue at M&EC;
|
·
|
growth
of our Nuclear segment;
|
·
|
expectation
that there will be a further decline in Section 404 of Sarbanes-Oxley
related third party charges for the fourth quarter of
2005;
|
·
|
ability
to close and remediate the Michigan facility for the estimated amounts.
|
·
|
fund
remediation of certain sites from funds generated
internally;
|
·
|
do
not expect the impact of SFAS 123R to have an impact on our cash
flow or
liquidity;
|
·
|
our
government contracts may not be re-awarded;
|
·
|
reduce
reserves recorded on discontinued operations or paid over longer
period,
and
|
·
|
seasonality
of the Nuclear segment on a going-forward
basis.
|
·
|
general
economic conditions;
|
·
|
material
reduction in revenues;
|
·
|
inability
to collect in a timely manner a material amount of receivables;
|
·
|
increased
competitive pressures;
|
·
|
the
ability to maintain and obtain required permits and approvals to
conduct
operations;
|
·
|
the
ability to develop new and existing technologies in the conduct
of
operations;
|
·
|
ability
to retain or renew certain required permits;
|
·
|
discovery
of additional contamination or expanded contamination at a certain
Dayton,
Ohio, property formerly leased by the Company or the Company's
facilities
at Memphis, Tennessee; Valdosta, Georgia; Detroit, Michigan; Ft.
Lauderdale, Florida; and Tulsa, Oklahoma, which would result in
a material
increase in remediation expenditures;
|
·
|
changes
in federal, state and local laws and regulations, especially environmental
laws and regulations, or in interpretation of such;
|
·
|
Fluctuation
of variable interest rates could materially affect our estimated
future
payments of interest on our variable rate debt.
|
·
|
potential
increases in equipment, maintenance, operating or labor
costs;
|
·
|
management
retention and development;
|
·
|
financial
valuation of intangible assets is substantially less than
expected;
|
·
|
termination
of the Oak Ridge Contracts as a result of our lawsuit against Bechtel
Jacobs or otherwise;
|
·
|
the
requirement to use internally generated funds for purposes not
presently
anticipated;
|
·
|
inability
to continue to be profitable on an annualized basis;
|
·
|
the
inability of the Company to maintain the listing of its Common
Stock on
the NASDAQ;
|
·
|
the
determination that PFMI, PFSG, or PFO was responsible for a material
amount of remediation at certain superfund sites;
|
·
|
terminations
of contracts with federal agencies or subcontracts involving federal
agencies, or reduction in amount of waste delivered to the Company
under
these contracts or subcontracts;
|
·
|
determination
that PFD is required to have a Title V air permit in connection
with its
operations, or is determined to have violated environmental laws
or
regulations in a material manner;
and
|
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||||||||||||||
Consolidated
(amounts in thousands)
|
2005
|
%
|
2004
|
%
|
2005
|
%
|
2004
|
%
|
|||||||||||||||||
Net
revenues
|
$
|
23,041
|
100.0
|
$
|
24,337
|
100.0
|
$
|
70,008
|
100.0
|
$
|
60,277
|
100.0
|
|||||||||||||
Cost
of goods sold
|
16,342
|
70.9
|
16,808
|
69.1
|
50,465
|
72.1
|
43,195
|
71.7
|
|||||||||||||||||
Gross
profit
|
6,699
|
29.1
|
7,529
|
30.9
|
19,543
|
27.9
|
17,082
|
28.3
|
|||||||||||||||||
Selling,
general and administrative
|
4,965
|
21.5
|
4,443
|
18.3
|
15,342
|
21.9
|
12,975
|
21.5
|
|||||||||||||||||
Loss
(gain) on disposal/impairment of property
& equipment
|
4
|
¾
|
1,014
|
4.2
|
(333
|
)
|
(.5
|
)
|
996
|
1.7
|
|||||||||||||||
Impairment
loss on intangible assets
|
¾
|
¾
|
7,101
|
29.2
|
¾
|
¾
|
7,101
|
11.8
|
|||||||||||||||||
Income
from operations
|
$
|
1,730
|
7.6
|
$
|
(5,029
|
)
|
20.8
|
$
|
4,534
|
6.5
|
$
|
(3,990
|
)
|
(6.7
|
)
|
||||||||||
Interest
expense
|
$
|
(385
|
)
|
(1.7
|
)
|
$
|
(294
|
)
|
(1.2
|
)
|
$
|
(1,178
|
)
|
(1.7
|
)
|
$
|
(1,535
|
)
|
(2.5
|
)
|
|||||
Interest
expense-financing fees
|
(48
|
)
|
(.2
|
)
|
(1,566
|
)
|
(6.4
|
)
|
(269
|
)
|
(.4
|
)
|
(2,079
|
)
|
(3.4
|
)
|
|||||||||
Other
income (expense)
|
(100
|
)
|
(.4
|
)
|
(31
|
)
|
(.1
|
)
|
(159
|
)
|
(.2
|
)
|
(48
|
)
|
(.1
|
)
|
|||||||||
Income
(loss) from continuing operations
|
1,161
|
5.0
|
(6,957
|
)
|
(28.6
|
)
|
2,611
|
3.7
|
(7,813
|
)
|
(13.0
|
)
|
|||||||||||||
Preferred
Stock dividends
|
(46
|
)
|
(.2
|
)
|
(48
|
)
|
(.2
|
)
|
(140
|
)
|
(.2
|
)
|
(142
|
)
|
(.2
|
)
|
(In
thousands)
|
2005
|
%
Revenue
|
2004
|
%
Revenue
|
Change
|
%
Change
|
|||||||||||||
Nuclear
|
|||||||||||||||||||
Government
waste
|
$
|
2,295
|
10.0
|
$
|
2,940
|
12.0
|
$
|
(645
|
)
|
(21.9
|
)
|
||||||||
Hazardous/Non-hazardous
|
830
|
3.6
|
1,069
|
4.4
|
(239
|
)
|
(22.3
|
)
|
|||||||||||
Other
nuclear waste
|
3,184
|
13.8
|
6,250
|
25.7
|
(3,066
|
)
|
(49.1
|
)
|
|||||||||||
Bechtel
Jacobs
|
4,951
|
21.5
|
2,627
|
10.8
|
2,324
|
88.5
|
|||||||||||||
Total
|
11,260
|
48.9
|
12,886
|
52.9
|
(1,626
|
)
|
(12.6
|
)
|
|||||||||||
Industrial
Revenues
|
|||||||||||||||||||
Commercial
waste
|
7,745
|
33.6
|
6,468
|
26.6
|
1,277
|
19.7
|
|||||||||||||
Government
services
|
716
|
3.1
|
1,529
|
6.3
|
(813
|
)
|
(53.2
|
)
|
|||||||||||
Acquisitions
|
2,637
|
11.5
|
2,609
|
10.7
|
28
|
1.1
|
|||||||||||||
Total
|
11,098
|
48.2
|
10,606
|
43.6
|
492
|
4.6
|
|||||||||||||
Engineering
|
683
|
2.9
|
845
|
3.5
|
(162
|
)
|
(19.2
|
)
|
|||||||||||
Total
|
$
|
23,041
|
100.0
|
$
|
24,337
|
100.0
|
$
|
(1,296
|
)
|
(5.3
|
)
|
(In
thousands)
|
2005
|
%
Revenue
|
2004
|
%
Revenue
|
Change
|
%
Change
|
|||||||||||||
Nuclear
|
|||||||||||||||||||
Government
waste
|
$
|
10,746
|
15.4
|
$
|
10,532
|
17.5
|
$
|
214
|
2.0
|
||||||||||
Hazardous/Non-hazardous
|
3,615
|
5.2
|
2,721
|
4.5
|
894
|
32.9
|
|||||||||||||
Other
nuclear waste
|
10,244
|
14.6
|
10,866
|
18.0
|
(622
|
)
|
(5.7
|
)
|
|||||||||||
Bechtel
Jacobs
|
11,358
|
16.2
|
6,752
|
11.2
|
4,606
|
68.2
|
|||||||||||||
Total
|
35,963
|
51.4
|
30,871
|
51.2
|
5,092
|
16.5
|
|||||||||||||
Industrial
Revenues
|
|||||||||||||||||||
Commercial
waste
|
20,739
|
29.6
|
16,794
|
27.9
|
3,945
|
23.5
|
|||||||||||||
Government
services
|
3,513
|
5.0
|
4,405
|
7.3
|
(892
|
)
|
(20.2
|
)
|
|||||||||||
Acquisitions
|
7,648
|