CECO Environmental Reports First Quarter 2012 Results

Earnings per Share Increases 50% Year-over-Year

May 10, 2012, 07:28 ET from CECO Environmental Corp.

CINCINNATI, May 10, 2012 /PRNewswire/ -- CECO Environmental Corp. (Nasdaq: CECE), a leading global provider of air pollution control technology, systems and equipment, today announced first quarter results for the period ended March 31, 2012.

Financial highlights for the first quarter of 2012 compared to the first quarter of 2011 include:

Net sales were $33.0 million as compared to $36.0 million in the same period of 2011. The decline in revenues was a result of some customer project delays and previously communicated product portfolio improvements and divestitures;  

Gross profit increased by 20%, to $10.2 million as compared to $8.5 million in 2011;

Gross margin increased to 30.9% compared to 23.6% for the same quarter in 2011;

Operating income increased to $3.7 million in 2012 as compared to $2.4 million in 2011, a 54% improvement; 

Operating margin increased to 11.2% from 6.7% in 2011;

Net income increased to $2.0 million in 2012 as compared to net income of $1.3 million in 2011;

Net income per diluted share increased to $0.12 in 2012 as compared to $0.08 in 2011;

Bookings were $30.7 million compared to $33.3 million in 2011;

Cash and cash equivalents increased to $19.9 million compared to $12.7 as of December 31, 2011, with no bank debt; and

Backlog as of March 31, 2012 was $52.6 million compared to $54.9 million as of December 31, 2011 and $51.6 million as of March 31, 2011. 

"I am once again very pleased with our results for the quarter as CECO continued to achieve significant improvements in margins and profitability," commented CECO's Chief Executive Officer, Jeff Lang. "We realized record gross and operating margins which was a direct result of our focus on operational excellence, improved product mix and enhanced sales pricing management.  We are seeing positive activity from new and existing customers as evidenced by our year to date bookings, which as of today, are higher than the same period in 2011 and which we believe will allow CECO to continue to generate improving results for the remaining quarters of 2012."

CECO will host a conference call on Thursday, May 10, 2012 at 8:30 a.m. EDT to review its financial results for the quarter.  Conferencing details are as follows:

Dial in number: 

866-713-8562

International dial in number:

617-597-5310

Participant passcode: 

57024248

Replay:

888-286-8010

International:

617-801-6888

Passcode: 

75362924

This call is being webcast by Thomson/CCBN and can be accessed at CECO's website at www.cecoenviro.com. The webcast is also being distributed through the Thomson StreetEvents Network.  Individual investors can listen to the call at www.earnings.com, Thomson's individual investor portal, powered by StreetEvents.  Institutional investors can access the call via Thomson StreetEvents (www.streetevents.com), a password-protected event management site.

ABOUT CECO ENVIRONMENTAL

CECO Environmental is a leading global provider of air pollution control technology. Through its subsidiaries – Busch International, CECO Filters, CECO Abatement Systems, Kirk & Blum, Effox-Flextor, Fisher-Klosterman/Buell, CECO China and A.V.C. Specialists – CECO provides a wide spectrum of air quality products and services including engineered equipment, cyclones, scrubbers, dampers, diverters, RTO's, component parts and monitoring and management services.  Industries served include refining, petro-chemical, power, aluminum, steel, automotive, chemical and large industrial processes.  Revenue from engineered equipment technology is approximately 75% and 25% from parts, services and aftermarket.  Global Growth, Operational Excellence, Margin Expansion, Safety, and Employee Development are CECO's core competencies and long term objectives.

For more information on CECO Environmental please visit the company's website at http://www.cecoenviro.com.

Contact: Corporate Information Jeff Lang, CECO Environmental Corp. Email: investors@cecoenviro.com  1-800-333-5475

CECO ENVIRONMENTAL CORP. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited)

Dollars in thousands, except per share data

THREE MONTHS ENDED MARCH 31,

2012

2011

Net sales  

$   33,026

$   35,956

Cost of sales 

22,842

27,483

Gross profit  

10,184

8,473

Selling and administrative

6,341

5,947

Amortization 

96

111

Income from operations 

3,747

2,415

Other expense, net

(65)

(27)

Interest expense (including related party interest of $59 and $58, respectively)  

(271)

(290)

Income before income taxes   

3,411

2,098

Income tax expense  

1,366

840

Net income   

$    2,045

$    1,258

Per share data:

Basic net income

$      0.14

$      0.09

Diluted net income 

$      0.12

$      0.08

Weighted average number of common shares outstanding:

Basic 

14,527,371

14,313,851

Diluted   

17,128,134

17,093,235

CECO ENVIRONMENTAL CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

Dollars in thousands, except per share data

MARCH 31, 2012

  DECEMBER 31,     2011

ASSETS

Current assets:

Cash and cash equivalents

$

19,860

$

12,724

Accounts receivable, net

20,268

23,109

Costs and estimated earnings in excess of billings on uncompleted contracts

6,274

10,643

Inventories, net

4,558

4,344

Prepaid expenses and other current assets

2,171

2,650

Total current assets

53,131

53,470

Property and equipment, net

5,502

5,651

Goodwill

14,741

14,661

Intangibles – finite life, net

432

526

Intangibles – indefinite life

3,226

3,218

Deferred income tax asset, net

848

848

Deferred charges and other assets

769

971

$

78,649

$

79,345

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued expenses 

$

11,117

$

13,569

Billings in excess of costs and estimated earnings on uncompleted contracts

9,038

9,647

Accrued income taxes

807

393

Total current liabilities

20,962

23,609

Other liabilities

3,160

3,146

Convertible subordinated notes (including related parties notes of $3,950 in 2012 and 2011)

9,400

9,600

Total liabilities

33,522

36,355

Shareholders' equity:

Preferred stock, $.01 par value; 10,000 shares authorized, none issued

Common stock, $0.01 par value; 100,000,000 shares authorized, 14,714,951 and 14,654,262      shares issued in 2012 and 2011, respectively

147

146

Capital in excess of par value

44,656

44,249

Accumulated earnings

2,834

1,301

Accumulated other comprehensive loss

(2,154)

(2,350)

45,483

43,346

Less treasury stock, at cost, 137,920 shares in 2012 and 2011, respectively

(356

(356)

Total shareholders' equity

45,127)

42,990

$

78,649

$

79,345

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  All forward-looking statements are subject to certain risks, uncertainties and assumptions.  These risks and uncertainties, which are more fully described in CECO's Annual and Quarterly Reports filed with the Securities and Exchange Commission, and include, but are not limited to: our dependence on fixed price contracts and the risks associated therewith, including actual costs exceeding our estimates and our method of accounting for contract revenue; our history of losses and possibility of further losses; fluctuations in operating results from period to period due to seasonality of our business; the effect of growth on our infrastructure, resources, and existing sales; our ability to expand our operations in both new and existing markets; the potential for contract delay or cancellation; the potential for fluctuations in prices for manufactured components and raw materials; the impact of federal, state or local government regulations; economic and political conditions generally; and the effect of competition in the air pollution control and industrial ventilation industry. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may vary in material aspects from those currently anticipated.  We caution investors that other factors might, in the future, prove to be important in affecting our results of operations. New factors emerge from time to time and it is not possible for management to predict all such factors, nor can it assess the impact of each such factor on the business or the extent to which any factor, or a combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Investors are further cautioned not to place undue reliance on such forward-looking statements as they speak only to our views as of the date the statement is made. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events or otherwise.

SOURCE CECO Environmental Corp.



RELATED LINKS

http://www.cecoenviro.com