CALGON CARBON ANNOUNCES FIRST QUARTER RESULTS
PITTSBURGH, PA – May 4, 2009 – Calgon Carbon Corporation (NYSE: CCC) announced results for the first quarter ended March 31, 2009.
The company reported net income of $6.0 million for the first quarter of 2009, as compared to net income of $10.4 million for the first quarter of 2008. On a fully diluted share basis, earnings per common share for the first quarter of 2009 were $0.11 versus $0.20 for the first quarter of 2008.
Included in the results for the first quarter of 2008 was a non-recurring after-tax gain of $5.7 million, or $0.11 per common share on a fully diluted share basis, from the settlement of a lawsuit.
Net sales for the first quarter of 2009 were $90.6 million, a slight increase over net sales of $90.3 million for the first quarter 2008. Because of the stronger U.S. dollar, currency translation had a $5.3-million, or 5.5%, negative impact on sales for the first quarter of 2009.
For the first quarter of 2009, sales for the Activated Carbon and Service segment increased slightly as compared to the first quarter of 2008. The 1.1% increase was primarily due to higher pricing for certain carbon products and services in the food and municipal drinking water markets, which was partially offset by lower demand in other market segments. Equipment sales increased by 12.4% in the first quarter of 2009 versus the comparable period in 2008, principally due to higher revenue for ultraviolet light and ion exchange systems. This increase was partially offset by lower revenue for carbon adsorption and odor control systems. A decline of 47.2% in Consumer sales for the first quarter of 2009 was primarily attributable to lower demand for carbon cloth products.
Net sales less the cost of products sold (excluding depreciation and amortization), as a percentage of net sales for the first quarter of 2009 was 32.5% versus 31.6% for the first quarter of 2008. Higher pricing on certain carbon and service products accounted for the increase by more than offsetting increases in activated carbon product costs.
Selling, administrative and research (SG&A) expenses for the first quarter of 2009 increased by 2.5% versus the comparable period in 2008. The increase was principally due to higher pension expense.
Interest income was $0.1 million for the first quarter of 2009. This compares with interest expense of $1.7 million for the first quarter of 2008. The change is due to the lower amount of debt outstanding during the first quarter of 2009 as a result of the company redeeming $69.0 million of its 5% Senior Convertible Notes in the second half of 2008.
Calgon Carbon’s board of directors did not declare a quarterly dividend.
Commenting on the quarter, John Stanik, Calgon Carbon’s chairman, president and chief executive officer, said, “The weak global economy had a significant negative impact on volume sold during the first quarter. Lower demand in many of our end markets resulted in a considerable decline in activated carbon and service sales volume.
Considering this, I am relatively pleased with the company’s performance in the first quarter. Despite the decline in volume, earnings per share showed improvement over last year, excluding the non-recurring gain in the first quarter of 2008. This improvement was achieved primarily through pricing on certain activated carbon and service products, lower interest expense, and tight expense control.”
Calgon Carbon Corporation, headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making water and air safer and cleaner.
This news release contains historical information and forward-looking statements. Forward-looking statements typically contain words such as “expect,” “believe,” “estimate,” “anticipate,” or similar words indicating that future outcomes are uncertain. Statements looking forward in time, including statements regarding future growth and profitability, price increases, cost savings, broader product lines, enhanced competitive posture and acquisitions, are included in the company’s most recent Annual Report pursuant to the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995. They involve known and unknown risks and uncertainties that may cause the company’s actual results in future periods to be materially different from any future performance suggested herein. Further, the company operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond the company’s control. Some of the factors that could affect future performance of the company are higher energy and raw material costs, costs of imports and related tariffs, labor relations, capital and environmental requirements, changes in foreign currency exchange rates, borrowing restrictions, validity of patents and other intellectual property, and pension costs. In the context of the forward-looking information provided in this news release, please refer to the discussions of risk factors and other information detailed in, as well as the other information contained in the company’s most recent Annual Report.
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