Perma-Fix Reports Financial Results for the Third Quarter of 2012
ATLANTA, GA -- (MARKETWIRE) -- 11/08/12 -- Perma-Fix Environmental Services, Inc. (NASDAQ: PESI) today announced results for the third quarter and nine months ended September 30, 2012.
Dr. Louis F. Centofanti, Chairman and Chief Executive Officer, stated, "We continue to feel the effects of delayed government spending in both our Treatment and Services Segments. During the third quarter and heading into the fourth quarter of 2012, we have seen a sequential improvement in our Treatment Segment sales, which is reflected in improvements in both revenue and backlog which were up approximately 13.6% and 59.6% respectively, compared to our second quarter of 2012. Within our Services Segment, we are winning smaller contracts; however, the larger contracts we are bidding on continue to be delayed. In the meantime, we remain focused on generating positive cash flow, reducing debt, controlling our costs and growing our revenue."
Financial Results
Revenue for the third quarter of 2012 was $29.1 million versus $32.8 million for the same period last year. Revenue for the Treatment Segment declined to $11.4 million from $20.2 million for the same period in 2011. Revenue from the Services Segment increased to $17.7 million from $12.6 million for the same period in 2011. Revenue generated from the acquisition of Safety and Ecology Holdings Corporation and its subsidiaries ("SEC") totaled $11.3 million offset by a decrease in revenue from the Department of Energy ("DOE") Hanford Site of approximately $6.1 million. Gross profit for the third quarter of 2012 was $4.4 million versus $11.3 million for the third quarter of 2011. Gross margin decreased to 15.2% from 34.5% for the same period last year primarily due to lower revenue and the impact of fixed costs on our cost of goods sold. Operating loss for the third quarter of 2012 was $(284,000) versus an income of $6.9 million for the third quarter of 2011. Net loss attributable to common stockholders for the third quarter of 2012 was $(425,000), or $(0.01) per share, versus net income of $6.0 million or $0.11 per share, for the same period in 2011. Net income for the third quarter of 2011 included a gain on disposal of discontinued operations of $1.8 million or $0.03 per share. The Company generated Adjusted EBITDA of $1.3 million from continuing operations during the quarter ended September 30, 2012, as compared to Adjusted EBITDA of approximately $8.1 million for the same period of 2011.
The Company defines EBITDA as earnings before interest, taxes, depreciation and amortization. EBITDA and Adjusted EBITDA are not measures of performance calculated in accordance with Generally Accepted Accounting Principles in the United States ("GAAP"), and should not be considered in isolation of, or as a substitute for, earnings as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. The Company believes the presentation of EBITDA is relevant and useful by enhancing the readers' ability to understand the Company's operating performance. The Company's management utilizes EBITDA as a means to measure performance. The Company's measurement of EBITDA may not be comparable to similarly titled measures reported by other companies. Due to the unique accounting for the recognition of fair market value of percentage of completion contracts resulting from the acquisition of SEC, the Company recognizes that EBITDA is an "Adjusted EBITDA" and understands these differences when measuring performance. The table below reconciles EBITDA and Adjusted EBITDA, both non-GAAP measures, to (loss) income from continuing operations for the three and nine months ended September 30, 2012 and 2011.
| Quarter Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| (In thousands) | 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Net (loss) income from continuing operations | $ | (343 | ) | $ | 4,421 | $ | (2,329 | ) | $ | 6,440 | |||||||
| Adjustments: | |||||||||||||||||
| Depreciation & amortization | 1,079 | 1,171 | 4,522 | 3,503 | |||||||||||||
| Interest income | (10 | ) | (14 | ) | (31 | ) | (40 | ) | |||||||||
| Interest expense | 223 | 99 | 642 | 458 | |||||||||||||
| Interest expense - financing fees | 23 | 22 | 84 | 178 | |||||||||||||
| Income tax (benefit) expense | (168 | ) | 2,399 | (1,126 | ) | 3,504 | |||||||||||
| EBITDA | 804 | 8,098 | 1,762 | 14,043 | |||||||||||||
| Fair value of percentage of completioncontract resulting from acquisition |
521 |
- |
1,249 |
- |
|||||||||||||
| Adjusted EBITDA | $ | 1,325 | $ | 8,098 | $ | 3,011 | $ | 14,043 | |||||||||
The tables below present certain financial information for the business segments, excluding allocation of corporate expenses:
| Three Months Ended | Nine Months Ended | |||||||||||
| September 30, 2012 | September 30, 2012 | |||||||||||
| (In thousands) | Treatment | Services | Treatment | Services | ||||||||
| Net revenues | $ | 11,405 | $ | 17,723 | $ | 34,284 | $ | 66,896 | ||||
| Gross profit | 3,097 | 1,337 | 6,904 | 5,556 | ||||||||
| Segment profit | 1,351 | 83 | 2,515 | 1,008 | ||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| September 30, 2011 | September 30, 2011 | |||||||||||
| (In thousands) | Treatment | Services | Treatment | Services | ||||||||
| Net revenues | $ | 20,150 | $ | 12,637 | $ | 50,116 | $ | 35,199 | ||||
| Gross profit | 8,979 | 2,322 | 15,911 | 6,469 | ||||||||
| Segment profit | 5,270 | 1,204 | 8,649 | 3,509 | ||||||||
Conference Call
Perma-Fix will host a conference call at 12:00 noon ET on Thursday, November 8, 2012. The call will be available on the Company's website at www.perma-fix.com, or by calling (877) 407-0778 for U.S. callers, or (201) 689-8565 for international callers. A webcast will also be archived on the Company's website and a telephone replay of the call will be available approximately one hour following the call, through midnight on Thursday, November 15, 2012, and can be accessed by calling: (877) 660-6853 (U.S. callers) or (201) 612-7415 (international callers) and entering conference ID: 403398.
About Perma-Fix Environmental Services
Perma-Fix Environmental Services, Inc. is a nuclear services company and leading provider of nuclear and mixed waste management services. The Company's nuclear waste services include management and treatment of radioactive and mixed waste for hospitals, research labs and institutions, federal agencies, including the DOE, the Department of Defense ("DOD"), and the commercial nuclear industry. The Company's nuclear services group provides project management, waste management, environmental restoration, decontamination and decommissioning, new build construction, and radiological protection, safety and industrial hygiene capability to our clients. The Company operates four nuclear waste treatment facilities and provides nuclear services at DOE, DOD, and commercial facilities, nationwide. Please visit us on the World Wide Web at http://www.perma-fix.com.
This press release contains "forward-looking statements" which are based largely on the Company's expectations and are subject to various business risks and uncertainties, certain of which are beyond the Company's control. Forward-looking statements generally are identifiable by use of the words such as "believe," "expects," "intends," "anticipate," "plans to," "estimates," "projects," and similar expressions. Forward-looking statements include, but are not limited to: remain focused on generating positive cash flow, reducing debt, controlling our costs and growing our revenue. These forward-looking statements are intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. While the Company believes the expectations reflected in this news release are reasonable, it can give no assurance such expectations will prove to be correct. There are a variety of factors which could cause future outcomes to differ materially from those described in this release, including, without limitation, future economic conditions; industry conditions; competitive pressures; our ability to apply and market our technologies; the government or such other party to a contract granted to us fails to abide by or comply with the contract or to deliver waste as anticipated under the contract; that Congress provides continuing funding for the Department of Defense's and Department of Energy's remediation projects; our ability to obtain new contracts on favorable terms; our ability to perform under contracts that we have and/or will be receiving; material contracts with the federal government, or subcontracts relating to federal sites, are terminated or renegotiated by the federal government; and the additional factors referred to under "Special Note Regarding Forward-Looking Statements" of our 2011 Form 10-K. The Company makes no commitment to disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that bear upon forward-looking statements.
Please visit us on the World Wide Web at http://www.perma-fix.com.
| FINANCIAL TABLES FOLLOW | |||||||||||||||||
| PERMA-FIX ENVIRONMENTAL SERVICES, INC. | |||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| (Amounts in Thousands, Except for Per Share Amounts) | 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Net revenues | $ | 29,128 | $ | 32,787 | $ | 101,180 | $ | 85,315 | |||||||||
| Cost of goods sold | 24,694 | 21,486 | 88,720 | 62,935 | |||||||||||||
| Gross profit | 4,434 | 11,301 | 12,460 | 22,380 | |||||||||||||
| Selling, general and administrative expenses | 4,198 | 4,022 | 13,825 | 10,829 | |||||||||||||
| Research and development | 502 | 357 | 1,390 | 1,019 | |||||||||||||
| Loss on disposal of property and equipment | 18 | - | 15 | - | |||||||||||||
| (Loss) income from operations | (284 | ) | 6,922 | (2,770 | ) | 10,532 | |||||||||||
| Other income (expense): | |||||||||||||||||
| Interest income | 10 | 14 | 31 | 40 | |||||||||||||
| Interest expense | (223 | ) | (99 | ) | (642 | ) | (458 | ) | |||||||||
| Interest expense-financing fees | (23 | ) | (22 | ) | (84 | ) | (178 | ) | |||||||||
| Other | 9 | 5 | 10 | 8 | |||||||||||||
| (Loss) income from continuing operations before taxes | (511 | ) | 6,820 | (3,455 | ) | 9,944 | |||||||||||
| Income tax (benefit) expense | (168 | ) | 2,399 | (1,126 | ) | 3,504 | |||||||||||
| (Loss) income from continuing operations, net of taxes | (343 | ) | 4,421 | (2,329 | ) | 6,440 | |||||||||||
| Loss from discontinued operations, net of taxes | (61 | ) | (187 | ) | (258 | ) | (7 | ) | |||||||||
| Gain on disposal of discontinued operations, net of taxes | - | 1,777 | - | 1,777 | |||||||||||||
| Net (loss) income | (404 | ) | 6,011 | (2,587 | ) | 8,210 | |||||||||||
| Less: net income attributable to non-controlling interest | 21 | - | 179 | - | |||||||||||||
| Net (loss) income attributable to Perma-Fix Environmental | |||||||||||||||||
| Services, Inc. common stockholders | $ | (425 | ) | $ | 6,011 | $ | (2,766 | ) | $ | 8,210 | |||||||
| Net (loss) income per common share attributable to | |||||||||||||||||
| Perma-Fix Environmental Services, Inc. stockholders - basic: | |||||||||||||||||
| Continuing operations | $ | (.01 | ) | $ | .08 | $ | (.04 | ) | $ | .12 | |||||||
| Discontinued operations | $ | - | $ | - | $ | (.01 | ) | $ | - | ||||||||
| Disposal of discontinued operations | $ | - | $ | .03 | $ | - | $ | .03 | |||||||||
| Net (loss) income per common share | $ | (.01 | ) | $ | .11 | $ | (.05 | ) | $ | .15 | |||||||
| Net (loss) income per common share attributable to | |||||||||||||||||
| Perma-Fix Environmental Services, Inc. stockholders - diluted: | |||||||||||||||||
| Continuing operations | $ | (.01 | ) | $ | .08 | $ | (.04 | ) | $ | .12 | |||||||
| Discontinued operations | $ | - | $ | - | $ | (.01 | ) | $ | - | ||||||||
| Disposal of discontinued operations | $ | - | $ | .03 | $ | - | $ | .03 | |||||||||
| Net (loss) income per common share | $ | (.01 | ) | $ | .11 | $ | (.05 | ) | $ | .15 | |||||||
| Number of common shares used in computingnet (loss) income per share: | |||||||||||||||||
| Basic | 56,140 | 55,174 | 56,099 | 55,137 | |||||||||||||
| Diluted | 56,140 | 55,174 | 56,099 | 55,142 | |||||||||||||
| PERMA-FIX ENVIRONMENTAL SERVICES, INC. | |||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEET | |||||||||||
| (Unaudited) | |||||||||||
| (Amounts in Thousands, Except for Share and Per Share Amounts) |
|
September 30, 2012 |
|
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December 31, 2011 |
|
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| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash | $ | 2,753 | $ | 12,055 | |||||||
| Restricted cash | 35 | 1,535 | |||||||||
| Account receivable, net of allowance for doubtful accounts of $803 and $228 | 14,981 | 19,106 | |||||||||
| Unbilled receivables | 8,694 | 9,871 | |||||||||
| Other current assets | 6,920 | 6,589 | |||||||||
| Deferred tax assets - current | 2,187 | 2,426 | |||||||||
| Assets of discontinued operations included in current assets, net of allowance for doubtful accounts of $47 and $48 | 526 | 693 | |||||||||
| Total current assets | 36,096 | 52,275 | |||||||||
| Net property and equipment | 36,487 | 39,835 | |||||||||
| Property and equipment of discontinued operations, net of accumulated depreciation of $60 and $62 | 1,614 | 1,650 | |||||||||
| Deferred tax asset, net of liabilities | 1,211 | 1,295 | |||||||||
| Intangibles and other assets | 73,100 | 69,548 | |||||||||
| Total assets | $ | 148,508 | $ | 164,603 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
| Current liabilities | 27,781 | 37,999 | |||||||||
| Current liabilities related to discontinued operations | 1,718 | 2,197 | |||||||||
| Total current liabilities | 29,499 | 40,196 | |||||||||
| Long-term liabilities | 24,793 | 28,084 | |||||||||
| Long-term liabilities related to discontinued operations | 1,953 | 1,775 | |||||||||
| Total liabilities | 56,245 | 70,055 | |||||||||
| Commitments and Contingencies | |||||||||||
| 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 plus accrued and unpaid dividends | 1,285 | 1,285 | |||||||||
| Stockholders' equity: | |||||||||||
| Preferred Stock, $.001 par value; 2,000,000 shares authorized, no shares issued and outstanding | - | - | |||||||||
| Common Stock, $.001 par value; 75,000,000 shares authorized, 56,186,121 and 56,068,248 shares issued, respectively; 56,147,911 and 56,030,038 outstanding, respectively | 56 | 56 | |||||||||
| Additional paid-in capital | 102,710 | 102,411 | |||||||||
| Accumulated deficit | (12,271 | ) | (9,505 | ) | |||||||
| Accumulated other comprehensive income | - | (3 | ) | ||||||||
| Less Common Stock in treasury, at cost: 38,210 shares | (88 | ) | (88 | ) | |||||||
| Total Perma-Fix Environmental Services, Inc. stockholders' equity | 90,407 | 92,871 | |||||||||
| Non-controlling interest | 571 | 392 | |||||||||
| Total stockholders' equity | 90,978 | 93,263 | |||||||||
| Total liabilities and stockholders' equity | $ | 148,508 | $ | 164,603 | |||||||
Contacts:
David K. Waldman
US Investor Relations
Crescendo Communications, LLC
(212) 671-1021
Herbert Strauss
European Investor Relations
Email Contact
+43 316 296 316
Released November 8, 2012