| Date: | February 26, 2010 | |
| For Release: | Immediate | |
| Contact: | Investor Contact: | |
| | Gary J. Morgan, | Joseph Hassett, VP |
| | Senior Vice President of Finance, CFO | Gregory FCA Communications |
| | 215-723-6751 | 610-228-2110 |
Met-Pro Corporation Announces
Fourth Quarter and Fiscal Year End Financial Results
Harleysville, PA, February 26, 2010 – Raymond J. De Hont, Chairman and Chief Executive Officer of Met-Pro Corporation (NYSE: MPR), today announced the Company’s financial results for the fourth quarter and fiscal year ended January 31, 2010.
Net sales for the fourth quarter ended January 31, 2010 were $19.8 million compared with net sales of $24.6 million for the fourth quarter last year. Net income in the fourth quarter totaled $1.3 million, or $0.09 per fully diluted share, compared with net income of $2.2 million, or $0.15 per fully diluted share, for the same quarter last year.
New order bookings for the fourth quarter were $18.0 million compared with $19.0 million for the same quarter last year.
“The fourth quarter proved to be another very challenging quarter as both revenues and earnings were down versus the fourth quarter last year,” said De Hont. “Fortunately, the efficiency and cost reduction initiatives we’ve implemented, together with our flexible manufacturing strategy, allowed us to generate solid gross margins of slightly greater than 33% in the fourth quarter despite reduced revenue levels. Lower selling, general and administrative expenses also positively impacted the fourth quarter financial results and together with the solid gross margins allowed us to deliver the most profitable quarter of the fiscal year. Though fourth quarter new order bookings were down slightly from a year ago, we believe the shortfall was simply a timing issue. We are encouraged by the level of large project activity and remain optimistic regarding future new order bookings.”
Net sales for the fiscal year ended January 31, 2010 were $80.1 million compared with fiscal 2009 net sales of $103.4 million. For the fiscal year ended January 31, 2010, net income totaled $4.4 million, or $0.30 per fully diluted share, compared with $9.9 million, or $0.65 per fully diluted share, for the prior fiscal year.
The Company generated a record $15.6 million in cash flow from operating activities in the fiscal year and ended the fiscal year with a cash balance of $31.4 million.
Bookings of new orders for the fiscal year ended January 31, 2010 were $81.8 million compared with $101.8 million for the same period last year.
“Our performance during the fiscal year ending January 31, 2010 again demonstrated the resiliency of our business model, as we sustained gross margins and improved operating efficiencies to generate profits and cash despite one of the most challenging years in our history,” added De Hont. “We recently consolidated our Duall, Flex-Kleen and Met-Pro Systems business units into a single business unit, Met-Pro Environmental Air Solutions. The newly formed Met-Pro Environmental Air Solutions business unit will allow us to improve our capacity utilization, reduce our cost structure and improve our competitive positioning and profitability. We will be better able to take advantage of the many synergies that exist between the Duall, Flex-Kleen and Systems brands, allowing us the opportunity to gain market share, especially in markets where we currently have limited or no presence, and service our customers in a more effective manner. With a high cash position and very little debt, our balance sheet remains extremely strong. We continue to focus on efficiency and cost reduction initiatives, which will allow us to effectively compete for new business while achieving solid gross margins.
Met-Pro Corporation/Page 2
“Market conditions seem to be improving, as our new order bookings were up $5.1 million or 13% in the second half of the fiscal year when compared with the first half of the fiscal year. We are confident that Met-Pro is ideally positioned to leverage our strong financial position to capitalize on a global economic recovery in which there will be rising demand for our extensive portfolio of energy-efficient, environmentally-friendly and productivity enhancing products.”
At their December 11, 2009 meeting, the Company’s Board of Directors declared a quarterly dividend of $0.06 per share payable on March 12, 2010 to shareholders of record at the close of business on February 26, 2010. This is the thirty-fifth consecutive year that Met-Pro Corporation has paid either a cash or stock dividend.
Mr. De Hont and Gary J. Morgan, Senior Vice President of Finance and Chief Financial Officer, will hold a conference call for investors today, February 26, 2010, at 11:00 AM (Eastern). Met-Pro’s earnings release and the accompanying financial supplement, which includes significant financial information to be discussed during the conference call, will be available on Met-Pro’s Investor Relations website at www.met-pro.com/html/invrel.htm prior to the beginning of the conference call.
Interested persons who wish to hear the live webcast should go to the Met-Pro Corporation website prior to the starting time to register, download and install any necessary audio software.
You may also participate by calling the US/Canada Dial-In # 877-818-7738 or the International Dial-In # 706-643-9333 (conference ID 54625283) at 10:55 AM (Eastern) today. A taped replay of the conference call will be available within two hours of the conclusion of the call and until March 12, 2010. To access the taped replay, call the US/Canada Dial-In # 800-642-1687 or the International Dial-In # 706-645-9291 and enter conference ID 54625283.
About Met-Pro
Met-Pro Corporation, with headquarters at 160 Cassell Road, Harleysville, Pennsylvania, was recently recognized as one of “America’s Fastest Growing Small Companies” by Fortune Small Business magazine. Through its business units in the United States, Canada, Europe and The People's Republic of China, a wide range of products and services is offered for industrial, commercial, municipal and residential markets worldwide. These include product recovery and pollution control technologies for purification of air and liquids; fluid handling technologies for corrosive, abrasive and high temperature liquids; filtration technologies for harsh, corrosive liquid filtration applications; and filtration and purification technologies which include proprietary water treatment chemicals and filter products for air and liquid filtration. For more information, please visit www.met-pro.com.
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information included in this news release, and other materials filed or to be filed with the Securities and Exchange Commission (as well as information included in oral or other written statements made or to be made by the Company), contain statements that are forward-looking. Such statements may relate to plans for future expansion, business development activities, capital spending, financing, the effects of regulation and competition, or anticipated sales or earnings results. Such information involves risks and uncertainties that could significantly affect results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of the Company. These risks and uncertainties include, but are not limited to, those relating to, the cancellation or delay of purchase orders and shipments, product development activities, goodwill impairment, computer systems implementation, dependence on existing management, the continuation of effective cost and quality control measures, retention of customers, global economic and market conditions, and changes in federal or state laws.
Met-Pro common shares are traded on the New York Stock Exchange, symbol MPR.
To obtain an Annual Report or additional information on the Company, please call 215-723-6751 and ask for the Investor Relations Department, or visit the Company’s website at www.met-pro.com.
Met-Pro Corporation/Page 3
Met-Pro Corporation
Consolidated Statement of Income
| | | Three Months Ended | | Fiscal Year Ended | |
| | | January 31, | | January 31, | |
| | | 2010 | | 2009 | | 2010 | | 2009 | |
| | Net sales | $19,798,121 | | $24,610,251 | | $80,132,493 | | $103,391,926 | |
| | Cost of goods sold | 13,217,027 | | 15,979,614 | | 52,755,941 | | 67,290,930 | |
| | Gross profit | 6,581,094 | | 8,630,637 | | 27,376,552 | | 36,100,996 | |
| | | | | | | | | | |
| | Operating expenses | | | | | | | | |
| | Selling | 2,326,140 | | 2,592,731 | | 9,741,528 | | 10,704,584 | |
| | General and administrative | 2,522,511 | | 2,838,093 | | 11,122,469 | | 11,339,333 | |
| | Income from operations | 1,732,443 | | 3,199,813 | | 6,512,555 | | 14,057,079 | |
| | | | | | | | | | |
| | Interest expense | (57,694 | ) | (48,301 | ) | (224,143 | ) | (228,249 | ) |
| | Other income, net | 121,736 | | 52,306 | | 260,177 | | 429,074 | |
| | Income before taxes | 1,796,485 | | 3,203,818 | | 6,548,589 | | 14,257,904 | |
| | | | | | | | | | |
| | Provision for taxes | 516,821 | | 982,725 | | 2,108,778 | | 4,396,839 | |
| | | | | | | | | | |
| | Net income | $1,279,664 | | $2,221,093 | | $4,439,811 | | $9,861,065 | |
| | | | | | | | | | |
| | Basic earnings per share | $.09 | | $.15 | | $.30 | | $.66 | |
| | Diluted earnings per share | $.09 | | $.15 | | $.30 | | $.65 | |
| | | | | | | | | | |
| | Average common shares outstanding: | | | | | | | | |
| | Basic shares | 14,601,259 | | 14,939,840 | | 14,602,276 | | 14,909,809 | |
| | Diluted shares | 14,676,349 | | 15,261,918 | | 14,675,735 | | 15,219,540 | |
Met-Pro Corporation/Page 4
Met-Pro Corporation
Consolidated Balance Sheet
| | | | January 31, | | January 31, | |
| | | | 2010 | | 2009 | |
| | Assets | | | | | |
| | Current assets | | | | | |
| | Cash and cash equivalents | | $31,387,108 | | $21,749,653 | |
| | Accounts receivable, net of allowance for doubtful | | | | | |
| | accounts of approximately $204,000 and | | | | | |
| | $167,000, respectively | | 14,011,950 | | 20,177,672 | |
| | Inventories | | 16,136,521 | | 20,236,865 | |
| | Prepaid expenses, deposits and other current assets | | 1,709,664 | | 1,997,542 | |
| | Total current assets | | 63,245,243 | | 64,161,732 | |
| | | | | | | |
| | Property, plant and equipment, net | | 19,860,751 | | 19,389,597 | |
| | Goodwill | | 20,798,913 | | 20,798,913 | |
| | Other assets | | 703,452 | | 402,062 | |
| | Total assets | | $104,608,359 | | $104,752,304 | |
| | | | | | | |
| | | | | | | |
| | Liabilities and shareholders’ equity | | | | | |
| | Current liabilities | | | | | |
| | Current portion of long-term debt | | $534,251 | | $746,042 | |
| | Accounts payable | | 4,297,936 | | 5,464,629 | |
| | Accrued salaries, wages and expenses | | 3,425,691 | | 4,546,199 | |
| | Dividend payable | | 876,279 | | 876,007 | |
| | Customers’ advances | | 882,637 | | 356,008 | |
| | Deferred income taxes | | 181,253 | | 250,782 | |
| | Total current liabilities | | 10,198,047 | | 12,239,667 | |
| | | | | | | |
| | Long-term debt | | 3,536,755 | | 3,753,228 | |
| | Other non-current liabilities | | 8,179,410 | | 8,855,912 | |
| | Deferred income taxes | | 1,716,563 | | 1,126,016 | |
| | Total liabilities | | 23,630,775 | | 25,974,823 | |
| | | | | | | |
| | Shareholders’ equity | | | | | |
| | Common shares, $.10 par value; 36,000,000 shares | | | | | |
| | authorized, 15,928,679 shares issued, of which | | | | | |
| | 1,311,664 and 1,328,570 shares were reacquired | | | | | |
| | and held in treasury at the respective dates | | 1,592,868 | | 1,592,868 | |
| | Additional paid-in capital | | 2,988,950 | | 2,465,193 | |
| | Retained earnings | | 90,662,820 | | 89,727,308 | |
| | Accumulated other comprehensive loss | | (3,679,641 | ) | (4,324,293 | ) |
| | Treasury shares, at cost | | (10,587,413 | ) | (10,683,595 | ) |
| | Total shareholders’ equity | | 80,977,584 | | 78,777,481 | |
| | Total liabilities and shareholders’ equity | | $104,608,359 | | $104,752,304 | |
Met-Pro Corporation/Page 5
Met-Pro Corporation
Consolidated Business Segment Data
| | | Three Months Ended January 31, | | Fiscal Year Ended January 31, | |
| | | 2010 | | 2009 | | 2010 | | 2009 | |
| | Net sales | | | | | | | | |
| | Product recovery/pollution control technologies | $8,999,225 | | $12,414,318 | | $35,899,630 | | $49,968,918 | |
| | Fluid handling technologies | 6,036,695 | | 7,344,046 | | 24,527,998 | | 30,414,765 | |
| | Mefiag filtration technologies | 2,545,181 | | 2,068,332 | | 9,526,908 | | 11,183,054 | |
| | Filtration/purification technologies | 2,217,020 | | 2,783,555 | | 10,177,957 | | 11,825,189 | |
| | | $19,798,121 | | $24,610,251 | | $80,132,493 | | $103,391,926 | |
| | | | | | | | | | |
| | Income (loss) from operations | | | | | | | | |
| | Product recovery/pollution control technologies | $313,684 | | $1,111,964 | | $1,924,005 | | $5,556,919 | |
| | Fluid handling technologies | 1,215,678 | | 1,825,706 | | 4,325,853 | | 6,848,148 | |
| | Mefiag filtration technologies | 76,486 | | (37,470 | ) | (34,886 | ) | 488,514 | |
| | Filtration/purification technologies | 126,595 | | 299,613 | | 297,583 | | 1,163,498 | |
| | | $1,732,443 | | $3,199,813 | | $6,512,555 | | $14,057,079 | |
| | | | | | | | | | |
| | | | | | | January 31, 2010 | | January 31, 2009 | |
| | Identifiable Assets | | | | | | | | |
| | Product recovery/pollution control technologies | | | | | $34,466,168 | | $39,623,284 | |
| | Fluid handling technologies | | | | | 18,068,428 | | 22,056,812 | |
| | Mefiag filtration technologies | | | | | 12,257,281 | | 11,410,677 | |
| | Filtration/purification technologies | | | | | 8,257,837 | | 9,369,905 | |
| | | | | | | 73,049,714 | | 82,460,678 | |
| | Corporate | | | | | 31,558,645 | | 22,291,626 | |
| | | | | | | $104,608,359 | | $104,752,304 | |
Met-Pro Corporation/Page 6
Consolidated Statement of Cash Flows
| | | | Years Ended January 31, | |
| | | | 2010 | | 2009 | |
| | Cash flows from operating activities | | | | | |
| | Net income | | $4,439,811 | | $9,861,065 | |
| | Adjustments to reconcile net income to net | | | | | |
| | cash provided by operating activities: | | | | | |
| | Depreciation and amortization | | 1,931,512 | | 1,924,611 | |
| | Deferred income taxes | | 406,754 | | 913,356 | |
| | (Gain) on sales of property and equipment, net | | (20,585 | ) | (18,174 | ) |
| | Loss on sale of investments | | – | | 11,102 | |
| | Stock-based compensation | | 645,967 | | 432,204 | |
| | Allowance for doubtful accounts | | 37,189 | | 14,695 | |
| | Changes in operating assets and liabilities: | | | | | |
| | Accounts receivable | | 6,409,090 | | 2,414,216 | |
| | Inventories | | 4,280,330 | | 723,256 | |
| | Prepaid expenses, deposits and other assets | | (9,904 | ) | (279,422 | ) |
| | Accounts payable and accrued expenses | | (2,551,921 | ) | (3,113,308 | ) |
| | Customers’ advances | | 524,678 | | 96,670 | |
| | Other non-current liabilities | | (447,208 | ) | (838,184 | ) |
| | | | | | | |
| | Net cash provided by operating activities | | 15,645,713 | | 12,142,087 | |
| | | | | | | |
| | Cash flows from investing activities | | | | | |
| | Proceeds from sales of property and equipment | | 40,318 | | 20,785 | |
| | Acquisitions of property and equipment | | (2,133,807 | ) | (1,580,528 | ) |
| | Increase in securities available for sale | | – | | (472 | ) |
| | Proceeds from sale of securities | | – | | 11,190 | |
| | | | | | | |
| | Net cash (used in) investing activities | | (2,093,489 | ) | (1,549,025 | ) |
| | | | | | | |
| | Cash flows from financing activities | | | | | |
| | Proceeds from new borrowings | | 485,336 | | – | |
| | Reduction of debt | | (926,497 | ) | (1,664,252 | ) |
| | Exercise of stock options | | 225,584 | | 1,912,398 | |
| | Payment of dividends | | (3,504,026 | ) | (3,359,962 | ) |
| | Purchase of treasury shares | | (251,612 | ) | (7,694,333 | ) |
| | | | | | | |
| | Net cash (used in) financing activities | | (3,971,215 | ) | (10,806,149 | ) |
| | Effect of exchange rate changes on cash | | 56,446 | | 55,863 | |
| | | | | | | |
| | Net increase (decrease) in cash and cash equivalents | | 9,637,455 | | (157,224 | ) |
| | | | | | | |
| | Cash and cash equivalents at beginning of year | | 21,749,653 | | 21,906,877 | |
| | | | | | | |
| | Cash and cash equivalents at end of year | | $31,387,108 | | $21,749,653 | |
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