LiqTech International, Inc. Reports 2013 Fiscal Year-end Results

- Management to Conduct Conference Call today, March 27th at 11am ET -

27 Mar, 2014, 09:00 ET from LiqTech International, Inc.

BALLERUP, Denmark, March 27, 2014 /PRNewswire/ -- LiqTech International, Inc., (NYSE: LIQT) a clean technology company that manufactures and markets highly specialized filtration technologies, announced today its financial and operational results for fiscal 2013.

Financial highlights for the year ended December 31, 2013

  • Net sales for the year ended December 31, 2013 were $12,826,168 compared to $16,921,838 for the year ended December 31, 2012, representing a decrease of $4,095,670 or 24 percent.
  • Gross profit for the year ended December 31, 2013 was $1,311,705 compared to $2,704,125 for the year ended December 31, 2012, representing a decrease of $1,392,420 or 52 percent.
  • Net income attributable to the Company for the year ended December 31, 2013 was a loss of $4,827,477 compared to a loss of $2,773,890 for the year ended December 31, 2012, representing a decrease of $2,053,587.
  • Cash on hand for the year ended December 31, 2013 was $4,884,275 compared to $3,873,338 for the year ended December 31, 2012, representing an increase of $1,010,937.
  • Working capital for the year ended December 31, 2013 was $7,692,669 compared to $8,069,595 for the year ended December 31, 2012, a decrease of $376,926.
  • Total net loss for 2013 includes non-cash charges for depreciation and amortization, bad debt expense, stock compensation expense and other one-time charges for a total of $4,051,788.

Operational highlights for 2013

  • LiqTech signed an exclusive multi-year, multi-million dollar agreement with FMC Technologies for unconventional shale oil/gas applications.
  • Breakthrough in achieving liquid sterilization by using a LiqTech filter.
  • We achieved our first commercial pool installation order in North America placed by Provital Solutions. Subsequently, on December 18, 2013, we announced receipt of an additional order placed by Provital Solutions for SiC membranes.
  • We signed an exclusive agreement to supply SiC membranes for Fan Run Si (Shanghai) Fluid Technology Co., Ltd. ("Fanrunsi"). Under the agreement, Fanrunsi will have exclusivity in China as a buyer of LiqTech's products for soy bean protein recovery (bio tech) and soy bean waste water treatment.
  • We received an additional purchase order from RIPE (Huzhou), a Chinese membrane system integrator. The purchase order was the third placed by RIPE in 2013 – significant order sizes of 256 sq. meters, and the latest for 480 sq. meters of membrane product.
  • We received an order from an East-European-based oil company for a containerized (mobile) LiqTech SiC membrane test system installation. The order represents a value to LiqTech of $300,000.
  • A major U.S. oil company ordered a LiqTech SiC membrane test system. The end-user placed the order to confirm the properties of the LiqTech SiC membrane technology for various upstream Produced Water applications.
  • Our silicon carbide (SiC) membranes were National Sanitation Foundation (NSF) Certified. LiqTech's membranes were tested and certified by NSF International to NSF/ANSI Standard 61, which means they are now approved for usage in drinking water systems.
  • We raised $4,051,000 through a warrant and option call offer to our shareholders and option holders.
  • We were approved for listing on NYSE MKT.
  • We were invited to participate in the Institute for Sustainable Process Technology (ISPT) water cluster with the intent to develop a commercial solution to treat oil emulsion challenges found in the upstream Oil & Gas industry. LiqTech was the only membrane supplier selected. The current members of this dedicated cluster are: Gaz de France, Shell, EBN, Frames, Vito, ISPT and LiqTech.

2014 highlights to date

  • We received a purchase order of approximately $300,000 for a prototype algae system based upon the LiqTech SiC membranes. The algae system will be based on a new development in the membrane technology from LiqTech.
  • We received our first production order for flat sheet silicon carbide membranes from the Middle East. The initial flat sheet silicon carbide membranes order is for 250 m2.
  • We received a DPF order for $450,000 from Emigreen B.V. Netherland for the luxury boat market segment.

In discussing the 2013 results, Mr. Finn Helmer, CEO, stated, "LiqTech's financial results reflect the continuous decline in the Diesel Particulate Filters ("DPF filters"), and that the growth of the membranes has not been able to offset the DPF decline. The decline in DPF revenue seems to have bottomed out and we believe it is starting to grow again. The revenue contribution from our membranes has now reached the same level as DPF filters, and we expect that our 2014 membrane sales will be larger than our 2014 DPF sales.

"Only a few of the bigger membrane projects have materialized to date, and most of the revenue is coming from test and small orders. During 2013, we have seen a strong and growing demand from all aspects of membrane sales. During the year we have signed agreements with five large players in the market. We expect these agreements to contribute to revenue in 2014, and we believe they will support the aggressive growth we are planning for over the next 3 to 5 years.

"In 2013, we refined our production process and prepared it for volume production. We have improved the quality and performance of our products while reducing the production costs. By year end we achieved standards that we believe establish LiqTech as the technology leader in the membrane business.

"DPF seems to have bottomed out and we have seen stronger demand, although it is still driven by major projects; and for that reason the revenue is fluctuating and difficult to predict. The expected environmental regulations are not yet implemented in many cities, and in some cases, the cities that have implemented new regulations are not strictly enforcing them. But the soot environmental problem is growing worldwide and soon many countries are expected to act. One new and very promising DPF market for LiqTech is the luxury boat market segment, where DPF is starting to play a key role and we are an important player in this market.

"Looking into 2014 and beyond, the challenge is now to take advantage of our technological leadership to generate the orders needed to make the company profitable."

Conference Call Details:

Interested parties may participate in the call by dialing (877) 407-8029; international callers dial (201) 689-8029. It is recommended to dial in approximately 10 to 15 minutes prior to the scheduled start time. The conference call will also be available on replay starting at 3:00 p.m. ET on March 27, 2014 and ending on April 10, 2014. To access the replay, please dial (877) 660-6853 and enter the (conference id# 13578697). The access number for the replay for international callers is (201) 612-7415 (conference id# 13578697).

-Financial charts follow-

 

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

As of

December 31,

As of

December 31,

2013

2012

Current Assets:

Cash

$ 4,884,275

$ 3,873,338

Accounts receivable, net

2,341,070

2,855,184

Other receivables

231,998

371,001

Cost in excess of billing

406,997

217,586

Inventories

4,258,606

4,111,815

Prepaid expenses

12,021

130,560

Current deferred tax asset

104,143

267,332

Total Current Assets

12,239,110

11,826,816

Property and Equipment, net accumulated depreciation

5,829,404

6,649,817

Other Assets:

Long term receivable

-

118,258

Other investments

6,882

158,141

Long term tax asset

1,863,349

75,947

Other intangible assets

24,687

29,150

Deposits

271,916

182,020

Total Other Assets

2,166,834

563,516

Total Assets

$ 20,235,348

$ 19,040,149

 

The notes in the 10-K are an integral part of these consolidated financial statements.

 

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

As of

December 31,

As of

December 31,

2013

2012

Current Liabilities:

Current portion of capital lease obligations

208,419

203,503

Accounts payable

1,586,962

2,289,231

Accrued expenses

1,440,522

760,881

Billing in excess of cost

96,104

237,063

Accrued income taxes payable

2,000

1,000

Deferred revenue / customers deposit

1,212,434

265,543

Total Current Liabilities

4,546,441

3,757,221

Long-term capital lease obligations, less current portion

554,360

729,567

Total Long-Term Liabilities

554,360

729,567

Total Liabilities

5,100,801

4,486,788

Stockholders' Equity:

Common stock; par value $0.001, 100,000,000 shares authorized,

27,212,500 and 24,111,500 shares issued and outstanding

at December 31, 2013 and December 31, 2012, respectively

27,213

24,112

Additional paid-in capital

18,700,574

12,658,405

Retained earnings (accumulated deficit)

(2,316,784)

2,510,693

Deferred compensation

(1,008,450)

(125,477)

Other comprehensive income, net

(292,565)

(542,806)

Non-controlled interest in subsidiaries

24,559

28,434

Total Stockholders' Equity

15,134,547

14,553,361

Total Liabilities and Stockholders' Equity

$ 20,235,348

$ 19,040,149

 

The notes in the 10-K are an integral part of these consolidated financial statements.

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS

For the Years Ended

December 31

2013

2012

Net Sales

$ 12,826,168

$ 16,921,838

Cost of Goods Sold

11,514,463

14,217,713

Gross Profit

1,311,705

2,704,125

Operating Expenses:

Selling expenses

2,650,000

2,434,541

General and administrative expenses

3,064,610

3,301,164

Non-cash compensation expenses

1,316,826

120,494

Research and development expenses

499,972

742,009

Total Operating Expense

7,531,408

6,598,208

Loss from Operations

(6,219,703)

(3,894,083)

Other Income (Expense)

Interest and other income

6,806

158,632

Interest expense

(50,945)

(148,611)

Loss on investments

(199,811)

(102,612)

Gain on currency transactions

7,638

48,145

Loss on sale of fixed assets

(2,135)

(889)

Total Other Expense

(238,447)

(45,335)

Loss Before Income Taxes

(6,458,150)

(3,939,418)

Income Tax Benefit

(1,611,561)

(1,165,528)

Net Loss

(4,846,589)

(2,773,890)

Less Net Loss Attributable To Non-Controlled Interests in Subsidiaries

(19,112)

-

Net Loss Attributable To LiqTech

$ (4,827,477)

$ (2,773,890)

Basic Loss Per Share

$ (0.19)

$ (0.12)

Weighted Average Common Shares Outstanding

24,989,262

23,644,883

Diluted Loss Per Share

$ (0.19)

$ (0.12)

Weighted Average Common Shares Outstanding Assuming Dilution

24,989,262

23,644,883

 

The notes in the 10-K are an integral part of these consolidated financial statements.

 

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED

DECEMBER 31,

2013

2012

Net Loss

(4,846,589)

(2,773,890)

Currency Translation, Net of Taxes

250,241

53,205

Other Comprehensive Loss

$

(4,596,348)

$

(2,720,685)

Comprehensive Income Attributable To Non-controlling Interest in Subsidiaries

1,294

2,239

Comprehensive Loss Attributable To LiqTech International Inc.

$

(4,597,642)

$

(2,722,924)

The notes in the 10-K are an integral part of these consolidated financial statements.

ABOUT LIQTECH INTERNATIONAL, INC. – (LIQT)

LiqTech International, Inc., a Nevada corporation, is a clean technology company that for more than a decade has developed and provided state-of-the-art technologies for gas and liquid purification using ceramic silicon carbide filters, particularly, highly specialized filters for the control of soot exhaust particles from diesel engines and for liquid filtration. It also manufactures kiln furniture. Using nanotechnology, LiqTech develops products using proprietary silicon carbide technology. LiqTech's products are based on unique silicon carbide membranes, which facilitate new applications and improve existing technologies. For more information, please visit www.liqtech.com.

Follow LiqTech on LinkedIn: http://www.linkedin.com/company/liqtech-international

Follow LiqTech on Twitter: https://twitter.com/LiqTech

Forward-Looking Statements:This press release contains "forward-looking statements." Although the forward-looking statements in this release reflect the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in the our reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, results of operation and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. We assume no obligation to update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this release.

 

SOURCE LiqTech International, Inc.



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