LiqTech International, Inc. Reports Financial And Operational Results For The Three And Six Months Ended June 30, 2015

MANAGEMENT TO HOST CONFERENCE CALL TODAY AT 11:00 am EDT

Aug 13, 2015, 09:00 ET from LiqTech International, Inc.

BALLERUP, Denmark, Aug. 13, 2015 /PRNewswire/ -- LiqTech International, Inc. (NYSE MKT: LIQT), a clean technology company that manufactures and markets highly specialized filtration products and systems, announced today its financial results for the three and six months ended June 30, 2015.

Highlights of the second quarter

  • On April 14, 2015 the Company announced the appointment of Dr. Rengarajan Ramesh to serve on the board of directors.
  • On June 8, 2015 the Company signed a three-year agent agreement with a Chinese company to promote and sell the Company's Diesel Particulate Filters (DPF) in the Chinese market.  At the same time, the Company received its first purchase order for $814,000 from a large Chinese OEM and retrofit customer.
  • On June 15, 2015 the Company signed a framework agreement with a new OEM customer, APATEQ S.A., for the delivery of UF (Ultra Fine) Filtration membranes and housing. The annual revenue under this agreement is estimated to be approximately $1 million. At the same time, the Company also received its first purchase order for $165,000.
  • On June 17, 2015 the Company received a $6.1 million system order from an international mining company for the removal of heavy metals from waste water. 
  • On June 18, 2015 the Company received an $830,000 purchase order for two systems for treatment of wastewater based on the Company's SiC membranes. 

Financial highlights for the three months ended June 30, 2015

  • Net sales for the three months ended June 30, 2015 were $1.70 million, compared to $3.97 million for the same period in 2014, representing a decrease of $2.27 million or 57.2%. The decrease in total sales was primarily driven by a decrease in sales of DPFs of $1.11 million and a decrease in sales of liquid filters and systems of $1.18 million.
  • Gross profit for the three months ended June 30, 2015 was a negative $0.56 million compared to a positive $0.85 million in the same period of 2014, representing a decrease of $1.41 million. Gross profit margin was a negative 32.8% compared to a positive 21.4% in the same period of the preceding year.
  • Net loss attributable to LiqTech for the three months ended June 30, 2015 was $1.79 million, compared to a net loss of $0.76 million in the same period last year, representing an increase in the net loss of $1.03 million

Financial highlights for the six months ended June 30, 2015

  • Net sales for the six months ended June 30, 2015 were $3.81 million compared to $7.17 million for the same period of 2014, representing a decrease of $3.36 million or 46.9%. The decrease in sales was driven primarily by a decrease in demand for DPFs caused by non-enforcement of mandates and market activity in general. The decrease in demand for liquid filters is due to postponements in delivery of incoming orders.
  • Gross profit for the six months ended June 30, 2015 was a loss of $0.61 million compared to $1.41 million for the same period of 2014, representing a decrease of $2.02 million or 143%. The decrease in gross profit was due to low sales activity compared to our fixed cost of goods sold.  Included in the gross profit is depreciation of $0.69 million and $0.87 million for the six months ended June 30, 2015 and 2014, respectively.
  • At June 30, 2015, the Company had cash and restricted cash of $3.10 million and working capital of $6.54 million.

Management Commentary

As noted previously, the first and second quarter results were as expected, disappointing.

The orders resulting from the focused marketing strategy we began implementing in the fall of 2014 have significantly increased our order book. The first quarter order inflow of $5.8 million was the highest in any quarter in the history of the Company. The second quarter the order inflow of $9.1 million set an additional record for the Company. We are pleased to see these early stage results from our focused strategy.

In the second quarter we announced the largest order in the history of the Company, a $6.1 million order for the removal of heavy metals from industrial waste water from a mining application. We believe that we have a well proven and robust technology for the removal of heavy metals from applications within the mining industry, wet scrubber systems in power plants and marine applications and from industrial waste water. We have seen an increased environmental focus around the world and we believe we will see further orders for these applications in the near future.

In the second quarter we also announced a three-year agent agreement and the first order for our Diesel Particulate Filters (DPF) for a Chinese OEM and retrofit customer. This order marked a break-through for us on the attractive Chinese market and we expect to see a high level of business from the Chinese market for the rest of 2015 and 2016.

With the significantly increased order intake, we remain confident that 2015 will prove to be a year of improvement.

Conference Call Details

Interested parties may participate in the call by dialing (877) 407-8029 or (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. EDT on August 13, 2015 and ending on August 27, 2015. To access the replay, please dial (877) 660-6853 and enter the conference id# 13616802. The access number for the replay for international callers is (201) 612-7415.

Callers from Denmark can dial in using the following numbers:

Denmark (fixed) ATT        

802 521 64

Denmark (mobile) ATT       

802 519 17

 

Tables Follow   

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



 As of   


 As of   


 June 30,  


 December 31,  


2015


2014


UNAUDITED



Current Assets: 




    Cash 

$   3,101,453


$    5,853,752

    Restricted cash 

-


218,879

    Accounts receivable, net 

1,618,943


1,992,206

    Other receivables 

153,767


344,331

    Cost in excess of billing 

572,508


1,172,658

    Inventories 

5,091,594


4,914,866

    Prepaid expenses 

91,663


55,990

    Current deferred tax asset 

72,292


109,637





        Total Current Assets 

10,702,220


14,662,319





Property and Equipment, net accumulated depreciation  

3,854,134


4,524,386





Other Assets: 




    Other investments 

5,587


6,085

    Long term deferred tax asset 

4,353,727


3,496,459

    Goodwill 

7,767,439


8,460,512

    Other intangible assets 

13,002


16,708

    Deposits 

236,908


259,070





        Total Other Assets 

12,376,663


12,238,834





Total Assets 

$  26,933,017


$   31,425,539

      

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



 As of
June 30,


 As of
December 31,


2015


2014


UNAUDITED



Current Liabilities: 




    Current portion of capital lease obligations 

$ 156,254


$ 170,187

    Accounts payable 

1567542


2,336,942

    Accrued expenses 

996543


1,439,735

    Billing in excess of cost  

48296


-

    Accrued income taxes payable 

-


570

    Deferred revenue / customers deposits  

1,389,250


144,476





        Total Current Liabilities 

4,157,886


4,091,910





Long-term capital lease obligations, less current portion 

244,137


368,614





        Total Long-Term Liabilities 

244,137


368,614





        Total Liabilities 

4,402,023


4,460,524





Stockholders' Equity: 




    Common stock; par value $0,001, 100,000,000 shares authorized, 




        39,504,782 and 39,404,782 shares issued and outstanding 




        at June 30, 2015 and December 31, 2014, respectively 

39,505


39,405

    Additional paid-in capital 

35,791,307


35,632,410

    Accumulated deficit 

(8,348,167)


(5,382,852)

    Deferred compensation 

(506,099)


(504,748)

    Other comprehensive income, net 

(4,445,552)


(2,835,917)

    Non-controlled interest in subsidiaries 

-


16,717





        Total Stockholders' Equity 

22,530,994


26,965,015





Total Liabilities and Stockholders' Equity 

$  26,933,017


$   31,425,539

 

LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES

(UNAUDITED) CONSOLIDATED STATEMENTS OF OPERATIONS



Three Months Ended 


Six Months Ended 


June 30, 


June 30, 


2015


2014


2015


2014

Net Sales 

$  1,701,055


$   3,973,687


$  3,805,556


$   7,171,189

Cost of Goods Sold 

2,259,497


3,122,473


4,410,964


5,764,847









Gross Profit 

(558,442)


851,214


(605,408)


1,406,342









Operating Expenses: 








    Selling expenses 

745,212


929,277


1,437,935


1,598,824

    General and administrative expenses 

683,061


763,524


1,499,128


1,436,181

    Non-cash compensation expenses 

84,724


172,205


157,646


392,623

    Research and development expenses 

202,984


39,833


365,457


140,419









        Total Operating Expense 

1,715,981


1,904,839


3,460,166


3,568,047









Loss from Operations 

(2,274,423)


(1,053,625)


(4,065,574)


(2,161,705)









Other Income (Expense) 








    Interest and other income 

49,459


10,550


49,702


13,745

    Interest expense 

(19,641)


(10,599)


(34,827)


(22,120)

    Gain (loss) on investments 

(71)


1,278


7,295


(841)

    Gain (loss) on currency transactions 

(100,450)


(48,112)


132,741


(45,325)









        Total Other Income (Expense) 

(70,703)


(46,883)


154,911


(54,541)









Loss Before Income Taxes  

(2,345,126)


(1,100,508)


(3,910,663)


(2,216,246)









Income Tax Benefit 

(575,575)


(337,118)


(967,104)


(695,560)









Net Loss 

(1,769,551)


(763,390)


(2,943,559)


(1,520,686)









Less Net Loss Attributable To Non-Controlled  








Interests in Subsidiaries 

24,356


(1,254)


21,760


(3,114)









Net Loss Attributable To LiqTech International, Inc. 

$ (1,793,907)


$   (762,136)


$ (2,965,319)


$   (1,517,572)









Basic Loss Per Share 

$     (0.05)


$      (0.03)


$     (0.08)


$       (0.06)









Weighted Average Common Shares Outstanding 

39,490,496


27,212,500


39,447,876


27,212,500









Diluted Loss Per Share 

$     (0.05)


$      (0.03)


$     (0.08)


$       (0.06)









Weighted Average Common Shares Outstanding Assuming Dilution 

39,490,496


27,212,500


39,447,876


27,212,500

  

ABOUT LIQTECH INTERNATIONAL, INC.

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. 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. In particular, Provital Solutions A/S (www.provital.dk), the Company's subsidiary, has developed a new standard of water filtration technology to meet the ever increasing demand for higher water quality. By incorporating LiqTech's SiC liquid membrane technology with its longstanding systems design experience and capabilities it offers solutions to the most difficult water pollution problem.

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.

CONTACT:  

Wolfe Axelrod Weinberger Associates, LLC
Stephen D. Axelrod, CFA/Don Weinberger 
(212) 370-4500, (212) 370-4505 fax 
steve@wolfeaxelrod.com
don@wolfeaxelrod.com 

SOURCE LiqTech International, Inc.



RELATED LINKS

http://www.liqtech.com