2014

LiqTech International, Inc. Reports 2013 Third Quarter Financial And Operational Results - Management to host conference call today at 11:00 am ET -

BALLERUP, Denmark, Nov. 14, 2013 /PRNewswire/ -- LiqTech International, Inc. (OTC-QX: LIQT) a clean technology company that manufactures and markets highly specialized filtration technologies, announced today its financial and operational results for third quarter 2013.

Financial highlights for the three months ended September 30, 2013

  • Net sales for the three month period ended September 30, 2013 were $2,949,605 compared to $3,115,471 for the same period in 2012, representing a decrease of $165,866, or 5.3%.
  • Liquid membrane filter sales grew to 49% of total sales in the quarter, an increase of $398,748 or 38.3%. Diesel Particulate Filter ("DPF filter") sales decreased $522,448 or 27.4% and Kiln furniture sales decreased $42,166 or 25.7% compared to the same period in 2012.
  • Gross profit for the three month period ended September 30, 2013 was $274,473 compared to $579,008 for the same period in 2012, representing a decrease of $304,535 or 52.6%.
  • Net loss attributable to the Company for the three month period ended September 30, 2013 was $903,956 compared to $427,872 for the same period in 2012, representing a decrease of $476,084, or 111.3%.
  • Included in the net loss for the three month period ended September 30, 2013 is non-cash compensation of $276,969, depreciation and amortization of $443,863, and other non-cash charges of $104,840, or total non-cash charges of $825,672.

Financial highlights for the nine months ended September 30, 2013

  • Net sales for the nine month period ended September 30, 2013 were $9,154,674 compared to $13,410,527 for the same period in 2012, representing a decrease of $4,255,853, or 31.7%.
  • DPF filter sales decreased $4,907,131 or 50.2%, liquid membrane filter sales increased $351,000 or 10.5% and Kiln furniture sales increased $300,278 or 95.1% compared to the same period in 2012.
  • Gross profit for the nine month period ended September 30, 2013 was $1,129,017 compared to $3,084,859 for the same period in 2012, representing a decrease of $1,955,842 or 63.4%.
  • Net loss attributable to the Company for the nine month period ended September 30, 2013 was $2,881,869 compared to $657,779 for the same period in 2012, representing a decrease of $2,224,090 or 338.1%.
  • Cash on hand for the nine month period ended September 30, 2013 was $1,562,652 compared to $3,873,338 for the year ended December 31, 2012, representing a decrease of $2,310,686.
  • Working capital for the nine month period ended September 30, 2013 was $6,344,883 compared to $8,069,595 for the year ended December 31, 2012, a decrease of $1,724,712.
  • Included in the net loss is non-cash compensation of $1,051,857, depreciation and amortization of $1,220,264 and other non-cash charges of $188,560, or total non-cash charges of $2,460,681.

Management Commentary

Mr. Finn Helmer, CEO, stated, "The significant growth of 38% in our third quarter ended September 30, 2013 liquid membrane filter sales over the same quarter a year earlier to $1.4 million is very encouraging as is the nine months liquid membrane filter sales growth of over 10% to $3.7 million.  Compared to second quarter 2013 our liquid membrane filter sales are up with 39% in the third quarter.  We believe that the liquid membrane momentum seen in the third quarter will accelerate in future quarters as many of the outstanding proposals come to fruition.

"However, our strong sales growth thus far this year in liquid membrane filters has been more than offset by a significant decline in our Diesel Particulate Filter (DPF) business.  We do not believe that state governments, particularly California, are actively enforcing the mandated particulate filter replacement.  As we move closer to the 2015 deadline to replace older particulate filter technologies with LiqTech's DPF product, we expect to see a groundswell of replacement activity. 

"In the longer term, we anticipate the acceptance of our disruptive silicon carbide liquid membrane filter growing rapidly and more than compensating for reduced DPF sales, as more customers see the benefits in cost savings through energy reduction, lower maintenance and increased productivity of our liquid membrane filters.  While we continue to seek additional DPF sales opportunities, our focus going forward will be on the many applications for liquid membrane filters. Membrane activity continues to show rapid growth, as many leading companies in a broad range of markets are requesting samples to test how our silicon carbide membrane solutions can be adapted to their requirements. 

"We have proposals outstanding with a number of companies serving major market segments that can benefit from using our silicon carbide membrane technology.  The time frame for acceptance and placement of orders varies from company-to-company and project-to-project, and usually requires extensive due diligence and expense.  As we have mentioned previously, we are focusing on several key markets, including: produced water, wastewater, desalinization, ballast water, pharmaceuticals and food processing.  We are making good progress; our year-to-date order intake of liquid membrane filters for the period ended September 30, 2013 was more than double compared to the same period in 2012.  

"The introduction of our flat sheet membrane has been very well received and we are enthusiastic about our near-term opportunities.  Unlike our regular silicon carbide membrane technology that normally requires extensive design work and testing before implementation into a customer's process, the flat sheet membrane can easily be made as a replacement part for many existing applications, thereby drastically reducing the time between testing and implementation. These flat sheet membranes could have a meaningful impact on both our revenue and earnings in 2014 and beyond.

"Kiln furniture sales were down moderately in the most recent quarter but we are up 95% for the nine months period ending September 30, 2013 compared to the same period in 2012.

"On October 9, 2013, subsequent to the end of the third quarter, LiqTech announced that the previously announced special warrant offer raised $4,051,000 which included participation by various members of senior management.  The supplementary capital not only improves the Company's capital structure and enhances our ability to list on an exchange but it also gives LiqTech additional flexibility to expand our marketing efforts and augment future growth.

"During my limited tenure as CEO, I have reviewed all aspects of LiqTech's business and I am increasingly excited about the technology, the increase in production capacity, the potential for further reductions in manufacturing costs and our future opportunities.  The significant progress we are making in developing new membrane products for new markets and building meaningful new customer relationships is just starting to be reflected in the meaningful growth in orders.  We believe as we continue to make progress in securing these orders, the market will better understand our tremendous long-term potential.  I am confident that LiqTech is poised to show exciting growth as the benefits of its silicon carbide membrane technology are accepted by a growing number of market leaders." 

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 November 14, 2013 and ending on November 28, 2013. To access the replay, please dial (877) 660-6853 and enter the conference id# 13572827. The access number for the replay for international callers is (201) 612-7415 (conference id# 13572827).

 - Financial charts follow -

 

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS








As of

September 30,



As of

December 31,


2013



2012

Current Assets:

UNAUDITED




Cash

$

1,562,652


$

3,873,338

Accounts receivable, net


1,926,998



2,855,184

Other receivables


194,798



371,001

Cost in excess of billing


445,142



217,586

Inventories


4,818,696



4,111,815

Prepaid expenses


42,504



130,560

Current deferred tax asset


280,251



267,332







Total Current Assets


9,271,041



11,826,816







Property and Equipment, net accumulated depreciation


5,958,143



6,649,817







Other Assets:






Long term receivable


-



118,258

Other investments


181,231



158,141

Long term tax asset


1,121,767



75,947

Other intangible assets


25,631



29,150

Deposits


205,948



182,020







Total Other Assets


1,534,577



563,516







Total Assets

$

16,763,761


$

19,040,149






Current Liabilities:





Current portion of capital lease obligations

$

207,514


$

203,503

Accounts payable


1,444,129



2,289,231

Accrued expenses


703,871



760,881

Billing in excess of cost


170,203



237,063

Accrued income taxes payable


1,000



1,000

Deferred revenue


399,440



265,543







Total Current Liabilities


2,926,157



3,757,221







Long-term capital lease obligations, less current portion


593,412



729,567







Total Long-Term Liabilities


593,412



729,567







Total Liabilities


3,519,569



4,486,788







Stockholders' Equity:






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

24,811,500 and 24,111,500 shares issued and outstanding at

September 30, 2013 and December 31, 2012, respectively


24,812



24,112

Additional paid-in capital


15,307,505



12,658,405

Retained earnings / Accumulated (deficit)


(371,175)



2,510,693

Deferred compensation


(1,273,419)



(125,477)

Other comprehensive income, net


(471,970)



(542,806)

Non-controlled interest in subsidiaries


28,439



28,434







Total Stockholders' Equity


13,244,192



14,553,361







Total Liabilities and Stockholders' Equity

$

16,763,761


$

19,040,149

 


LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES

(UNAUDITED) CONSOLIDATED STATEMENTS OF OPERATIONS














For the Three Months

Ended September 30,


For the Nine Months

Ended September 30,


2013


2012


2013


2012

Net Sales

$

2,949,605


$

3,115,471


$

9,154,674


$

13,410,527













Cost of Goods Sold


2,675,132



2,536,463



8,025,657



10,325,668













Gross Profit


274,473



579,008



1,129,017



3,084,859













Operating Expenses:












Selling expenses


654,005



557,235



1,943,522



1,816,612

General and administrative expenses


568,944



565,284



1,773,073



1,773,212

Non-cash compensation expenses


276,969



32,602



1,051,857



97,805

Research and development expenses


92,276



91,202



350,515



470,502













Total Operating Expenses


1,592,194



1,246,323



5,118,967



4,158,131













Loss from Operations


(1,317,721)



(667,315)



(3,989,950)



(1,073,272)













Other Income (Expense)












Interest and other income


9,313



12,455



11,713



111,294

Interest (expense)


(14,381)



(7,376)



(39,038)



(133,264)

Gain on currency transactions


115,011



12,478



78,037



76,077

(Loss) on sale of fixed assets


-



-



(2,135)



-













Total Other Income


109,943



17,557



48,577



54,107













Loss Before Income Taxes


(1,207,778)



(649,758)



(3,941,373)



(1,019,165)













Income Tax Benefit


(303,784)



(221,886)



(1,045,307)



(361,386)













Net Loss


(903,994)



(427,872)



(2,896,066)



(657,779)













Less Net Loss Attributable To Non-Controlled

Interests in Subsidiaries


(38)



-



(14,197)



-













Net Loss Attributable To LiqTech

$

(903,956)


$

(427,872)


$

(2,881,869)


$

(657,779)













Basic Loss Per Share

$

(0.04)


$

(0.02)


$

(0.12)


$

(0.03)













Weighted Average Common Shares Outstanding


24,511,500



24,111,500



24,329,082



23,488,208













Diluted Loss Per Share

$

(0.04)


$

(0.02)


$

(0.12)


$

(0.03)













Weighted Average Common Shares

   Outstanding Assuming Dilution


24,511,500



24,111,500



24,329,082



23,488,208

 

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.

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.



RELATED LINKS
http://www.liqtech.com

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