Abtech Holdings, Inc. Reports Fiscal Year 2011 Financial Results

SCOTTSDALE, Ariz., March 30, 2012 /PRNewswire/ -- Abtech Holdings, Inc. (OTCBB: ABHD) ("AbTech" or the "Company"), a developer and manufacturer of patented innovative environmental technologies addressing issues of water pollution and contamination, today reported financial results for its fiscal year ended December 31, 2011.  The Company has been highly productive during 2011.  AbTech secured its first exclusive marquee distribution partner, Waste Management, Inc., and by year end the team commenced roll-out of stormwater solutions in California, Canada and the Southeast US.  In addition, AbTech completed rigorous field testing of its highly effective treatment solutions for produced and frac water, as well as treatment for hazardous contaminated industrial waste water, and the Company commenced launch of these products into new markets.  AbTech also furthered its research and development efforts to treat additional contaminants such as heavy metals, PCBs and radionuclides. In early 2011, AbTech secured additional management talent to complete its executive team, and executed a reverse merger that brought together the operations and technology of AbTech Industries, Inc. and the public entity status of Abtech Holdings, Inc., effective February 10, 2011.  Since the merger, AbTech has secured approximately $7.3 million in debt financings.

"2011 was a constructive year during which we set the stage for a dynamic year in 2012.  Our highly experienced management, board and advisors have developed a well-grounded, strategic plan for profitable growth. Our Smart Sponge® product line, which addresses three market verticals, has been extensively tested and is primed for deployment; our production process has been refined and requisite capacity is in place or readily available; the Company's balance sheet has been strengthened to facilitate execution on our growth plan; and, finally, our sales and marketing initiatives are at the cusp of significant breakthrough," commented Glenn Rink, founder and CEO of AbTech.

Mr. Rink added, "After successfully completing a 10-month pilot phase with Waste Management for the treatment of stormwater for municipalities, we have moved into commercial phase, which we expect will materially contribute to our top-line growth in 2012 and beyond.  We have already begun generating revenue from stormwater treatment opportunities with federal and commercial properties and expect these sources to also materially benefit the Company this year.  In November of 2011 we completed a series of tests using Smart Sponge® material to enhance removal of hydrocarbons from frac water and have already assisted in preparing proposals using the Smart Sponge® material as a pretreatment to existing water treatment systems, allowing such systems to not only clean the water but also harvest the remaining energy from the water.  Finally, we are commencing launch of industrial waste water treatment for both the reuse of water within an industrial process as well as treatment of hazardous contaminated waste water."

For the full year 2011, AbTech reported revenues of $537,000, an increase from $434,000 for the previous year.  AbTech anticipates material acceleration in its revenue in the second half of 2012 as the market for its stormwater products expands, additional strategic alliances with market dominant strategic partners are completed and commercialization into new markets for produced water and other industrial applications of the Smart Sponge technology commences.  The Company reiterates its forecast of $17 to $20 million in revenues for full year 2012 with gross margins of approximately 50 percent.

The Company reported a net loss of $(5.4) million or $(0.11) per basic share for the full year 2011, compared to a net loss of $(3.0) million or $(0.06) per basic share for the full year 2010.   AbTech reported a loss from operations of $(3.7) million for the full year 2011 versus a loss from operations of $(2.8) million during the prior year 2010. If the Company is successful with its revenue growth strategies and gains traction into the summer months, operating profitability and positive cash flow will be achievable during the second half of 2012.  

Operating expenses during the full year 2011 totaled $3.7 million, an increase of approximately $884,000 (31%) over the prior full year 2010.  A significant portion of the increase was attributed to costs associated with the Company's reverse merger into a public entity and ongoing public company expenses.  In addition, AbTech increased its research and development (R&D) costs by 26 percent as the Company shifted its R&D focus to new products using the Smart Sponge technology in applications for the treatment of produced water and other industrial applications.  The Company's R&D efforts involved a significant amount of product testing in the lab and field. While AbTech anticipates a continued increase in operating expenses going forward, the Company believes it will be able to leverage its general, selling and administrative expenses to achieve operating profitability as it begins shipment of products under its anticipated marquee contracts.  

The Company incurred interest expense for the full year 2011 of $2.1 million as compared to $116,000 in 2010.  The increase in interest expense was due largely to a non-cash, non-recurring charge of $1.6 million for imputed interest on promissory notes that were converted to common stock on beneficial conversion terms during 2011.  In addition, during the second half of 2011, AbTech issued 12% convertible promissory notes that accrued interest of $126,000 in 2011.  Interest expense was further impacted by the amortization of deferred charges and imputed note discounts for warrants related to various private offerings, which were charged to interest expense in 2011 and amounted to approximately $125,000 and $160,000, respectively.

At December 31, 2011, the Company reported a cash and cash equivalents balance of $1.4 million, accounts receivable of $110,000 and inventory of $528,000.  Subsequent to year end 2011, the Company raised an additional $2.6 million in February 2012 that marked the final closing of the private offering of secured convertible promissory notes which began in 2011.  

At December 31, 2011, the Company's short term debt totaled approximately $4.3 million, and long term debt totaled approximately $2.0 million.  As of December 31, 2011, AbTech had approximately 47.2 million shares of common stock outstanding and fully diluted shares of approximately 78.8 million (inclusive of all options, warrants and convertible debt).  Upon the conversion of all options and warrants, the Company would receive approximately an additional $8 million.

It is recommended that participants phone-in at least 10 minutes before the call is scheduled to begin. Participants may pre-register for the call at: https://www.theconferencingservice.com/prereg/key.process?key=PHDWTCPNQ

Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference by bypassing the operator upon connection. A replay of the conference call in its entirety will be available approximately one hour after its completion by dialing 888-286-8010 (U.S.), 617-801-6888 (International) and entering the pass code 30463636 and on the Internet at www.earnings.com.

Investor Contact:
Yvonne L. Zappulla
Managing Director
Grannus Financial Advisors, Inc.
212-681-4108
[email protected]

or

Lane J. Castleton
Chief Financial Officer
Abtech Holdings, Inc.
480-874-4000
[email protected]

ABOUT ABTECH HOLDINGS, INC. (OTCBB: ABHD) AND ABTECH INDUSTRIES, INC.

AbTech Industries, Inc. (a subsidiary of Abtech Holdings Inc.) is a full-service environmental technologies and engineering firm dedicated to providing innovative solutions to communities, industry and governments addressing issues of water pollution and contamination. Its products are based on polymer technologies capable of removing hydrocarbons, sediment and other foreign elements in storm water runoff (ponds, lakes and marinas),  flowing water (curbside drains, pipe outflows, rivers and oceans), and industrial process and wastewater.  AbTech's offerings include the ground-breaking new antimicrobial technology called Smart Sponge® Plus. This technology is effective in reducing coliform bacteria found in stormwater, industrial wastewater, and municipal wastewater. Smart Sponge® Plus is registered with the Environmental Protection Agency (Registration #86256-1). AbTech's teams of water treatment technology experts, civil and environmental engineers, and field operations specialists develop solutions to improve the quality of our limited water resources. AbTech's Smart Sponge technology is installed in more than 15,000 locations across America and in 8 countries worldwide. For more information please visit: www.abtechindustries.com.

This news release contains "forward-looking statements" as that term is defined in Section 27A of the United States Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, the development, costs and results of new business opportunities. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with new projects. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that any beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that any such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-K for the most recent fiscal year, our quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the Securities and Exchange Commission.

AbTech Company Contact: [email protected]

*** Financial Statements Follow ***

SOURCE Abtech Holdings, Inc.