Perma-Fix Announces Financial Results and Provides Business Update for the Fourth Quarter and Full Year 2012

Significant Government, International and Commercial Opportunities Resulting From Key Initiatives; Further Reduces Overhead and SG&A in Q1 2013 by an Additional $4.3 million on an Annualized Basis

ATLANTA, GA -- (MARKETWIRE) -- 03/22/13 -- Perma-Fix Environmental Services, Inc. (NASDAQ: PESI) today announced results for the fourth quarter and full year ended December 31, 2012.

Dr. Louis F. Centofanti, Chairman and Chief Executive Officer, stated, "As stated in the past, we have dramatically expanded our sales pipeline and are now bidding on a much broader scope of projects, including government, commercial and international business. We have begun to see the positive effect of these initiatives, including some initial service contracts we have been awarded, such as a task order by the U.S. Department of Energy (DOE) for technical services at the West Valley Demonstration Project; a recent award to provide technical consulting for decontamination of the Fukushima Daiichi Nuclear Power Station; and a collaboration agreement with the Pennsylvania Department of Environmental Protection for an oil and gas development radiation study related to hydraulic fracturing."

"We have also expanded our treatment capabilities and are pursuing very meaningful opportunities treating more complex and higher activity waste streams. For example, we believe we have treatment technologies and permitted facilities in place that could be utilized to rapidly and effectively address problematic waste streams, including tank waste at Hanford, Washington and other DOE sites around the country. We are especially pleased to announce our recent partnership with Kurion, Inc., to pursue deployment of Kurion's GeoMelt® In-Container Vitrification (ICV™) at our fixed facilities, which we believe will allow us to treat a variety of highly complex nuclear waste streams at Hanford and other sites that we believe currently have no other commercially available treatment and disposal options."

"As a result of these and other similar initiatives in 2012, we believe we are well positioned heading into the new year. In response to the fiscal challenges we faced in 2012, we have significantly reduced our operating expenses. During the first quarter of 2013 alone, we implemented cost savings, which we expect will reduce our overhead and SG&A by an additional $4.3 million on an annualized basis. Although we still feel the effects of delayed government spending in the first half of 2013, we expect to achieve improved operating results and cash flow for the full year 2013. Moreover, we believe some of the current projects we are pursuing could be transformative for the company."

Financial Results

Revenue for the fourth quarter of 2012 was $26.7 million versus $32.8 million for the same period last year. Revenue for the Treatment Segment decreased to $11.6 million from $15.7 million for the same period in 2011. Revenue from the Services Segment was $15.1 million versus $17.1 million for the same period in 2011.

Gross profit for the fourth quarter of 2012 was $3.3 million versus $6.0 million for the fourth quarter of 2011 primarily due to lower revenue and revenue mix. Gross margin decreased to 12.3% from 18.4% 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 fourth quarter of 2012 was $1.7 million versus operating income of $837,000 for the fourth quarter of 2011. Net loss attributable to common stockholders for the fourth quarter of 2012 was $3.5 million, or ($0.06) per share, versus net income of $5.6 million or $0.10 per share, for the same period in 2011. Net loss included a charge to deferred income tax expense of $3.3 million, $1.9 million of which is due to a reserve provided for an uncertain tax position and $1.4 million was attributed to the write-off of deferred tax asset.

The Company generated Adjusted EBITDA of $77,000 from continuing operations during the quarter ended December 31, 2012, as compared to Adjusted EBITDA of approximately $2.5 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 measurements of EBITDA may not be comparable to similar 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 income from continuing operations for the three and twelve months ended December 31, 2012 and 2011.

             
             
    Quarter Ended     Twelve Months Ended  
    December 31,     December 31,  
    (unaudited)     (unaudited)  
(In thousands)   2012     2011     2012     2011  
Net (Loss) Income from Continuing Operations   $ (4,262 )   $ 5,132     $ (6,550 )   $ 11,572  
                                 
                                 
Adjustments:                                
  Depreciation & Amortization     1,368       1,313       5,470       4,816  
  Interest Income     (10 )     (18 )     (41 )     (58 )
  Interest Expense     176       200       818       657  
  Interest Expense - Financing Fees     24       28       107       207  
  Income Tax (benefit) expense     2,353       (4,598 )     1,250       (1,095 )
                                 
EBITDA   $ (351 )   $ 2,057     $ 1,054     $ 16,099  
                                 
  Costs in Excess of Revenue and Amortization of Acquired Contracts     428       441       2,295       441  
                                 
Adjusted EBITDA   $ 77     $ 2,498     $ 3,349     $ 16,540  
                                 
                                 
                                 

The tables below present certain unaudited financial information for the business segments, excluding allocation of corporate expenses:

         
         
    Quarter Ended   Quarter Ended
    December 31, 2012   December 31, 2011
(In thousands)   Treatment     Services   Treatment    Services
Net revenues   $ 11,598     $ 15,086   $ 15,721   $ 17,061
Gross profit     2,365       914     5,388     652
Segment (loss) profit      (2,967 )     427     6,750     475
                           
                           
    Twelve Months Ended   Twelve Months Ended
    December 31, 2012   December 31, 2011
(In thousands)   Treatment     Services   Treatment   Services
Net revenues   $ 45,882     $ 81,627   $ 65,836   $ 52,261
Gross profit     9,268       6,536     21,299     7,121
Segment (loss) profit      (450 )     1,474     15,399     3,983
                           
                           
                           

Conference Call

Perma-Fix will host a conference call at 11:00 a.m. ET on Friday, March 22, 2013. 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 March 29, 2013, and can be accessed by calling: (877) 660-6853 (U.S. callers) or (201) 612-7415 (international callers) and entering conference ID: 410744.

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: treatment of complex nuclear waste streams; anticipate improvement in operating results and cash flow for 2013; and current projects we are pursuing could be transformational for the Company. 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 new 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 DOD's and DOE's remediation projects; ability to obtain new foreign and domestic remediation contracts; and the additional factors referred to under "Special Note Regarding Forward-Looking Statements" of our 2012 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     Twelve Months Ended  
    December 31,     December 31,  
(Amounts in Thousands, Except for Per Share Amounts)   2012     2011     2012     2011  
                                 
Net revenues   $ 26,684     $ 32,782     $ 127,509     $ 118,097  
Cost of goods sold     23,405       26,742       111,705       89,677  
  Gross profit     3,279       6,040       15,804       28,420  
                                 
Selling, general and administrative expenses     4,565       4,735       18,390       15,564  
Research and development     433       483       1,823       1,502  
(Gain) loss on disposal of property and equipment      -       (15 )     15       (15 )
  (Loss) income from operations     (1,719 )     837       (4,424 )     11,369  
                                 
Other income (expense):                                
Interest income     10       18       41        58  
Interest expense     (176 )     (200 )     (818 )     (657 )
Interest expense-financing fees     (24 )     (28 )     (107 )     (207 )
Loss on extinguishment of debt      -       (91 )      -       (91 )
Other     (1 )     (2 )     8       5  
(Loss) income from continuing operations before taxes     (1,910 )     534       (5,300 )     10,477  
Income tax expense (benefit)     2,352       (4,598 )     1,250       (1,095 )
(Loss) income from continuing operations     (4,262 )     5,132       (6,550 )     11,572  
                                 
Income from discontinued operations, net of taxes     717       784       458       777  
(Loss) gain on disposal of discontinued operations, net of taxes      -       (268 )      -       1,509  
  Net (loss) income     (3,545 )     5,648       (6,092 )     13,858  
                                 
Less: net income attributable to non-controlling interest     1       22       180       22  
                                 
Net (loss) income attributable to common stockholders   $ (3,546 )   $ 5,626     $ (6,272 )   $ 13,836  
                                 
                                 
Net (loss) income per common share attributable to Perma-Fix Environmental Services, Inc. stockholders - basic:                                
                                 
Continuing operations   $ (.07 )   $  .09     $ (.12 )   $  .21  
Discontinued operations      .01        .01        .01        .01  
Disposal of discontinued operations      -        -        -        .03  
Net (loss) income per common share   $ (.06 )   $  .10     $ (.11 )   $  .25  
                                 
Net (loss) income per common share attributable to Perma-Fix                                
Environmental Services, Inc. stockholders - diluted:                                
                                 
Continuing operations   $ (.07 )   $  .09     $ (.12 )   $  .21  
Discontinued operations      .01        .01        .01        .01  
Disposal of discontinued operations      -        -        -        .03  
Net (loss) income per common share   $ (.06 )   $  .10     $ (.11 )   $  .25  
                                 
Number of common shares used in computing net (loss) income per common share:                                
Basic     56,200       55,765       56,125       55,295  
Diluted     56,200       55,781       56,125       55,317  
                                 
                                 
                                 
PERMA-FIX ENVIRONMENTAL SERVICES, INC.  
CONSOLIDATED BALANCE SHEET  
(UNAUDITED)  
             
    December 31,     December 31,  
(Amounts in Thousands, Except for Share and Per Share Amounts)   2012     2011  
                 
ASSETS                
Current assets:                
  Cash and equivalents   $ 4,403     $ 13,590  
  Account receivable, net of allowance for doubtful accounts of $2,507 and $2,441     11,395       16,848  
  Unbilled receivables     8,530       9,632  
  Other current assets     4,067        6,146  
  Deferred tax assets - current     1,553       3,853  
  Assets of discontinued operations included in current assets, net of allowance for doubtful accounts of $45 and $48     499       693  
    Total current assets     30,447       50,762  
                 
Net property and equipment     35,314       39,835  
Property and equipment of discontinued operations, net of accumulated depreciation of $60 and $62, respectively     1,614       1,650  
Deferred tax asset, net of liabilities     1,103       1,435  
Intangibles and other assets     72,553       71,895  
    Total assets   $ 141,031     $ 165,577  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY                
Current liabilities   $ 25,628     $ 40,543  
Current liabilities related to discontinued operations     1,512       2,197  
    Total current liabilities     27,140       42,740  
                 
Long-term liabilities     23,425       26,742  
Long-term liabilities related to discontinued operations     1,829       1,775  
    Total liabilities     52,394       71,257  
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     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, 56,238,525 and 56,068,248 shares issued, respectively; 56,200,315 and 56,030,038 outstanding, respectively     56       56  
  Additional paid-in capital     102,819       102,411  
  Accumulated deficit     (16,005 )     (9,733 )
  Accumulated other comprehensive loss     (2 )     (3 )
  Less Common Stock in treasury at cost: 38,210 and 0 shares, respectively     (88 )     (88 )
    Total Perma-Fix Environmental Services, Inc. stockholders' equity     86,780       92,643  
  Non-controlling interest     572       392  
      Total stockholders' equity     87,352       93,035  
                   
    Total liabilities and stockholders' equity   $ 141,031     $ 165,577  
                 
                 
                 

Contacts:
David K. Waldman
US Investor Relations
Crescendo Communications, LLC
(212) 671-1021

Herbert Strauss
European Investor Relations
herbert@eu-ir.com
+43 316 296 316