LiqTech International Inc. Reports 2012 Fiscal Year-end Results

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Mar 27, 2013, 09:00 ET

BALLERUP, Denmark, March 27, 2013 /PRNewswire/ -- LiqTech International, Inc. (OTCQX:LIQT) a clean technology company that manufactures and markets highly specialized filtration technologies, announced today its financial and operational results for fiscal 2012.

Financial highlights for the year ended December 31, 2012

Net sales for the year ended December 31, 2012 were $16,921,838 compared to $21,192,177 for the year ended December 31, 2011, representing a decrease of $4,270,339 or 20 percent
Gross profit for the year ended December 31, 2012 was $2,704,125 compared to $5,027,811, representing a decrease of $2,323,686
Net income attributable to the Company for the year ended December 31, 2012 was a loss of $2,773,890 compared to a profit of $917,211 for the year ended December 31, 2011, representing a decrease of $3,691,101
Cash on hand for the year ended December 31, 2012 was $3,873,338 compared to $1,033,057 for the year ended December 31, 2011, representing an increase of $2,840,281, and an increase of $163,271 from the cash of $3,710,067 at September 30, 2012
Working capital for the year ended December 31, 2012 was $8,069,595 compared to $1,878,203 for the year ended December 31, 2011, an increase of $6,191,392
Over 97% of the total net loss for 2012 was due to non-cash charges for depreciation and amortization, bad debt expense, and stock option expense

Operational highlights for 2012

Raised net proceeds of $7.1 million in a common stock placement
Opened offices in Singapore and joined with the Singapore Public Utility Board in a wastewater program
Established sales in several new markets including Israel, Australia and India
Signed an exclusivity agreement with Constructora Conconcreto for LiqTech's SiC membrane technology for water filtration in the Oil and Gas industry in Colombia and Venezuela
Signed a non-exclusive OEM supply agreement with Denovo in China for LiqTech's SiC membrane technology. The OEM agreement includes progressive minimum order quantities for the years 2013-2016 for Denovo to maintain the supply agreement

2013 highlights to date

Signed an exclusive multi-year, multi-million agreement with FMC Technologies for unconventional shale oil/gas applications
Breakthrough in achieving liquid sterilization by using a LiqTech filter
Developed a new silicon carbide membrane flat sheet product
Developed a new silicon carbide membrane disc product

In discussing the 2012 results, Mr. Lasse Andreassen, CEO, stated, "LiqTech's financial results reflect a continued pattern of neglect in enforcing mandates by the California Air Resources Board ("CARB") where a projected 12,000 Diesel Particulate Filters ("DPF filters") were due to be installed in 2012 with only a relatively small fraction of that amount actually installed."

"While we still believe that the mandate will be enforced and we will continue to sell DPF filters to satisfy that ultimate demand, we are focusing on our disruptive Silicon Carbide membrane technology for liquids which represents a vast market opportunity to LiqTech."

"We have discussed the lengthy testing period that our potential customers put our membranes through before reaching a decision; some take as long as several years, but the end result is worth the time. The recent announcement of our exclusive agreement with FMC Technologies for the use of our Silicon Carbide membranes in unconventional shale oil/gas applications entailed over a year of discussions and testing, but is just one example of the benefits of our patience and sales efforts."

"When we first introduced our silicon carbide membrane technology to customers we met the usual resistance and skepticism that new disruptive technologies face but over the last several years the number of customers testing our membranes has grown from just a handful, but now numbers over 150. We have announced a number of those arrangements and agreements and we anticipate that number will continue to show significant growth."

"We are extremely excited about the revenue opportunities that abound and expect the revenue potential from membrane sales to ramp up rapidly going forward. Consequently, in building for our future we faced some significant bumps in the road but we are more optimistic than ever about our future."

-Financial charts follow-

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

	As of	As of
	December 31,	December 31,
	2012	2011
Current Assets:
Cash	$ 3,873,338	$ 1,033,057
Accounts receivable, net	2,855,184	5,299,569
Other receivables	371,001	1,528,362
Cost in excess of billing	217,586	256,161
Inventories	4,111,815	2,980,583
Prepaid expenses	130,560	301,375
Current deferred tax asset	267,332	17,786

Total Current Assets	11,826,816	11,416,893

Property and Equipment, net accumulated depreciation	6,649,817	6,647,217

Other Assets:
Long term receivable	118,258	-
Other investments	158,141	6,483
Long term tax asset	75,947	-
Other intangible assets	29,150	34,167
Deposits	182,020	146,184

Total Other Assets	563,516	186,834

Total Assets	$ 19,040,149	$ 18,250,944

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
	As of	As of
	December 31,	December 31,
	2012	2011

Current Liabilities:
Lines of credit	$ -	$ 1,259,936
Notes payable - current portion	-	259,396
Notes payable - related party, net of discount	-	3,328,183
Current portion of capital lease obligations	203,503	191,444
Accounts payable - trade	2,289,231	3,026,960
Accrued expenses	760,881	1,375,714
Billing in excess of cost	237,063	93,347
Accrued income taxes payable	1,000	3,710
Deferred revenue	265,543	-

Total Current Liabilities	3,757,221	9,538,690

Notes payable and long-term debt, less current portion	-	350,000
Long-term capital lease obligations, less current portion	729,567	950,351
Deferred tax liability	-	668,484

Total Long-Term Liabilities	729,567	1,968,835

Total Liabilities	4,486,788	11,507,525

Stockholders' Equity:
Common stock; par value $0,001, 100,000,000 shares authorized, 24,111,500 and 21,600,000 shares issued and outstanding at December 31, 2012 and December 31, 2011, respectively	24,112	21,600
Additional paid-in capital	12,658,405	5,603,517
Retained earnings	2,510,693	5,284,583
Deferred compensation	(125,477)	(268,282)
Other comprehensive income, net	(542,806)	(596,011)
Note receivable from a shareholder, net of discount	-	(3,328,183)
Non-controlled interest in subsidiaries	28,434	26,195

Total Stockholders' Equity	14,553,361	6,743,419

Total Liabilities and Stockholders' Equity	$ 19,040,149	$ 18,250,944

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS


	FOR THE YEAR ENDED
	DECEMBER 31,
	2012	2011
Net Sales	$ 16,921,838	$ 21,192,177

Cost of Goods Sold	14,217,713	16,164,366

Gross Profit	2,704,125	5,027,811
Operating Expenses:
Selling expenses	2,434,541	1,484,992
General and administrative	3,421,658	1,943,333
Research and development	742,009	502,413

Total Operating Expenses	6,598,208	3,930,738

Income (Loss) from Operations	(3,894,083)	1,097,073

Other Income (Expense)
Interest and other income	158,632	100,986
Interest (expense)	(148,611)	(203,682)
(Loss) on investments	(102,612)	(57,684)
Gain on currency transactions	48,145	10,271
Gain (loss) on sale of fixed assets	(889)	411,436

Total Other Income (Expense)	(45,335)	261,327

Income Before Income Taxes	(3,939,418)	1,358,400

Income Tax Expense (Benefit)	(1,165,528)	359,508

Net Income (Loss)	(2,773,890)	998,892

Less Net Income Attributable To
Non-Controlled Interests in Subsidiaries	-	81,681

Net Income (Loss) Attributable To LiqTech	$ (2,773,890)	$ 917,211

Basic Earnings (Loss) Per Share	$ (0.12)	$ 0.06
Weighted Average Common Shares Outstanding	23,644,883	14,165,217
Diluted Earnings (Loss) Per Share	$ (0.12)	$ 0.06
Weighted Average Common Shares Outstanding
Assuming Dilution	23,644,883	16,096,973

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

	FOR THE YEAR ENDED
	DECEMBER 31,
	2012	2011

Net Income (Loss)	(2,773,890)	998,892

Currency Translation, Net of Taxes	53,205	327,323

Other Comprehensive Income (Loss)	$ (2,720,685)	$ 1,326,215

Comprehensive Income (Loss) Attributable To
Non-controlling Interest in Subsidiaries	2,239	94,246

Comprehensive Income (Loss) Attributable To LiqTech International Inc.	$ (2,722,924)	$ 1,231,969

ABOUT LIQTECH INTERNATIONAL, INC. – (OTCQX: 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.

CONTACT:
Wolfe Axelrod Weinberger Associates, LLC
Stephen D. Axelrod, CFA/Adam Lowensteiner
(212) 370-4500, (212) 370-4505
[email protected], [email protected]

SOURCE LiqTech International, Inc.