Carbo Ceramics (CRRTQ) 8-K Carbo Ceramics Inc. Unaudted Pro Forma Consolidated Financial Statements

Exhibit 99.1

CARBO CERAMICS INC.
UNAUDTED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

     The following unaudited pro forma consolidated financial statements present the historical financial statements of CARBO Ceramics Inc., (the “Company”) with adjustments relating to the sale of a portion of the assets of the Company’s wholly-owned subsidiary, Pinnacle Technologies, Inc. The sale, which includes substantially all of the fracture and reservoir diagnostic business, the Pinnacle name and related trademarks, was completed on October 10, 2008. The cash proceeds received from the sale totaled $143.7 million, including the $137.0 million purchase price plus $6.7 million for preliminary working capital adjustments.

     The historical financial information has been derived from the historical consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2007 and the Quarterly Report on Form 10-Q for the quarter ended June 30, 2008. These unaudited pro forma consolidated financial statements should be read in conjunction with the historical consolidated financial statements and accompanying notes previously filed in these reports. The unaudited pro forma consolidated balance sheet as of June 30, 2008 was prepared as if the sale had been completed on June 30, 2008. The unaudited pro forma consolidated statements of income for the six month period ended June 30, 2008 and the years ended December 31, 2007, 2006 and 2005 were prepared as though the sale had been completed on January 1, 2005.

     The unaudited pro forma consolidated financial statements are not necessarily indicative of the results of operations or financial position of the Company that would have been reported had the sale been completed as of the dates presented, and are not necessarily representative of the future consolidated results of operations or financial position of the Company.

     The Company will account for this group of assets sold as a discontinued operation in accordance with Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-lived Assets, in its future financial statements.

CARBO Ceramics Inc.
Unaudited Pro Forma Consolidated Balance Sheet
As of June 30, 2008
($ in thousands)

			Pro Forma
	Historical		Adjustments			Notes			Pro Forma
ASSETS
Current assets:
Cash and cash equivalents	$	9,397	$	142,841			(1	)	$	152,238
Trade accounts and other receivables, net		85,799		(20,911	)					64,888
Inventories:
Finished goods		37,312		—						37,312
Raw materials and supplies		26,378		—						26,378
Total inventories		63,690		—						63,690
Prepaid expenses and other current assets		4,085		(420	)					3,665
Prepaid income taxes		493		(493	)					—
Deferred income taxes		7,280		(1,626	)		(4	)		5,654
Total current assets		170,744		119,391						290,135
Property, plant and equipment:
Land and land improvements		10,924		(827	)					10,097
Land-use and mineral rights		6,255		—						6,255
Buildings		48,171		(4,365	)					43,806
Machinery and equipment		319,270		(31,876	)					287,394
Construction in progress		13,811		(2,669	)					11,142
Total		398,431		(39,737	)					358,694
Less accumulated depreciation		124,105		(14,079	)					110,026
Net property, plant and equipment		274,326		(25,658	)					248,668
Goodwill		23,199		(18,340	)		(3	)		4,859
Intangible and other assets, net		10,876		(7,571	)					3,305
Total assets	$	479,145	$	67,822					$	546,967
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	7,762	$	(2,185	)				$	5,577
Accrued payroll and benefits		7,111		(579	)					6,532
Accrued freight		4,984		—						4,984
Accrued utilities		4,283		—						4,283
Accrued income taxes		—		29,428			(2	)		29,428
Retainage related to construction in progress		85		—						85
Other accrued expenses		5,712		(740	)					4,972
Total current liabilities		29,937		25,924						55,861
Deferred income taxes		35,407		(4,797	)		(4	)		30,610
Shareholders’ equity:
Preferred stock, none outstanding		—		—						—
Common stock		246		—						246
Additional paid-in capital		110,405		588			(5	)		110,993
Retained earnings		297,703		46,488						344,191
Accumulated other comprehensive income		5,447		(381	)					5,066
Total shareholders’ equity		413,801		46,695						460,496
Total liabilities and shareholders’ equity	$	479,145	$	67,822					$	546,967

Pro Forma Adjustments include the net book values of the assets sold and liabilities assumed, and the following adjustments:

(1)	Cash includes $143,741 of cash received, net of estimated transaction expenses totaling $900.
(2)	Estimated income taxes payable associated with the tax gain on sale.
(3)	Adjustment to record the estimated value of $18,340 of goodwill associated with the sold assets.
(4)	Settlement of deferred income taxes associated with the sold assets.
(5)	Stock compensation costs associated with the accelerated vesting of certain restricted stock awards in connection with the discontinued operations.

CARBO Ceramics Inc.
Unaudited Pro Forma Consolidated Statement of Income
For the Six Months Ended June 30, 2008
($ in thousands, except per share amounts)

			Pro Forma
	Historical		Adjustments		Pro Forma
Revenues	$	204,926	$	25,266	$	179,660
Cost of sales		140,551		14,355		126,196
Gross profit		64,375		10,911		53,464
Selling, general and administrative expenses		23,177		5,858		17,319
Start-up costs		231		—		231
Loss on disposal of assets		110		—		110
Operating profit		40,857		5,053		35,804
Other income (expense):
Interest income, net		56		—		56
Foreign currency exchange gain (loss), net		1,427		—		1,427
Other, net		227		40		187
		1,710		40		1,670
Income before income taxes		42,567		5,093		37,474
Income taxes		14,806		1,935		12,871
Net income	$	27,761	$	3,158	$	24,603
Earnings per share:
Basic	$	1.14			$	1.01
Diluted	$	1.13			$	1.00
Average shares outstanding:
Basic		24,458,834				24,458,834
Diluted		24,556,910				24,556,910

Pro Forma Adjustments include results of the discontinued operations.

CARBO Ceramics Inc.
Unaudited Pro Forma Consolidated Statement of Income
For the Year Ended December 31, 2007
($ in thousands, except per share amounts)

			Pro Forma
	Historical		Adjustments		Pro Forma
Revenues	$	340,351	$	40,355	$	299,996
Cost of sales		221,202		23,132		198,070
Gross profit		119,149		17,223		101,926
Selling, general and administrative expenses		39,615		10,631		28,984
Start-up costs		1,215		—		1,215
Loss on disposal of assets		268		—		268
Operating profit		78,051		6,592		71,459
Other income (expense):
Interest income, net		419		—		419
Foreign currency exchange gain (loss), net		2,882		—		2,882
Other, net		48		229		(181	)
		3,349		229		3,120
Income before income taxes		81,400		6,821		74,579
Income taxes		27,530		2,592		24,938
Net income	$	53,870	$	4,229	$	49,641
Earnings per share:
Basic	$	2.21			$	2.04
Diluted	$	2.20			$	2.03
Average shares outstanding:
Basic		24,367,479				24,367,479
Diluted		24,483,902				24,483,902

Pro Forma Adjustments include results of the discontinued operations.

CARBO Ceramics Inc.
Unaudited Pro Forma Consolidated Statement of Income
For the Year Ended December 31, 2006
($ in thousands, except per share amounts)

			Pro Forma
	Historical		Adjustments			Pro Forma
Revenues	$	312,126	$	28,297		$	283,829
Cost of sales		196,133		16,236			179,897
Gross profit		115,993		12,061			103,932
Selling, general and administrative expenses		34,732		8,744			25,988
Start-up costs		474		—			474
Loss on disposal of assets		—		—			—
Operating profit		80,787		3,317			77,470
Other income (expense):
Interest income, net		1,590		—			1,590
Foreign currency exchange gain (loss), net		1,387		—			1,387
Other, net		50		(78	)		128
		3,027		(78	)		3,105
Income before income taxes		83,814		3,239			80,575
Income taxes		29,561		1,231			28,330
Net income	$	54,253	$	2,008		$	52,245
Earnings per share:
Basic	$	2.23				$	2.15
Diluted	$	2.22				$	2.14
Average shares outstanding:
Basic		24,280,778					24,280,778
Diluted		24,400,531					24,400,531

Pro Forma Adjustments include results of the discontinued operations.

CARBO Ceramics Inc.
Unaudited Pro Forma Consolidated Statement of Income
For the Year Ended December 31, 2005
($ in thousands, except per share amounts)

				Pro Forma
	Historical			Adjustments		Pro Forma
Revenues	$	252,673		$	21,724	$	230,949
Cost of sales		153,941			13,529		140,412
Gross profit		98,732			8,195		90,537
Selling, general and administrative expenses		27,245			6,326		20,919
Start-up costs		1,092			—		1,092
Loss on disposal of assets		95			—		95
Operating profit		70,300			1,869		68,431
Other income (expense):
Interest income, net		1,756			—		1,756
Foreign currency exchange gain (loss), net		(147	)		—		(147	)
Other, net		174			208		(34	)
		1,783			208		1,575
Income before income taxes		72,083			2,077		70,006
Income taxes		25,463			789		24,674
Net income	$	46,620		$	1,288	$	45,332
Earnings per share:
Basic	$	1.94				$	1.89
Diluted	$	1.93				$	1.87
Average shares outstanding:
Basic		24,004,563					24,004,563
Diluted		24,177,364					24,177,364

Pro Forma Adjustments include results of the discontinued operations.