TOR Minerals International, Inc. Announces Third Quarter Financial Results
CORPUS CHRISTI, Texas, November 11, 2010 - TOR Minerals International, Inc. (Nasdaq: TORM), producer of synthetic titanium dioxide, color pigments, specialty aluminas, and other high performance mineral fillers, today announced its financial results for the third quarter ended September 30, 2010. The Company reported net income available to common shareholders of $221,000, or $0.09 per diluted share, on net sales of $7,543,000. This compares with a net loss available to common shareholders of ($32,000), or ($0.02) per share, on net sales of $6,441,000 for the quarter ended September 30, 2009.
Net sales increased 17.1 percent during the third quarter of 2010 over the third quarter of 2009. All product categories showed year-over-year growth, as demand in paint and plastics markets continued to improve. During the third quarter of 2010, sales of titanium dioxide and color pigments, which includes HITOX® and TIOPREM® product groups, increased 7.9 percent to $3.1 million. Sales of specialty alumina products, which includes ALUPREM® and HALTEX® product groups, increased 21.7 percent to $3.3 million during the third quarter of 2010 as demand for new and existing specialty alumina products also improved. Third quarter sales from other product categories increased 34.2 percent to $1.1 million.
During the third quarter of 2010, operating income increased to $397,000, or 5.3 percent of sales, compared to operating income of $208,000, or 3.2 percent of sales reported during the third quarter of 2009. The year-over-year improvement in profitability resulted from increased sales levels, increased plant utilization, and greater operational efficiencies.
Net sales for the nine months ended September 30, 2010, were $22,327,000, an increase of 25.4 percent compared to $17,798,000 reported during the nine-month period ended September 30, 2009. Net income available to common shareholders was $1,245,000, or $0.51 per diluted share, for the nine months ended September 30, 2010, compared to a net loss of ($339,000), or ($0.18) per share, for the same period a year ago.
Commenting on the results, Dr. Olaf Karasch, Chief Executive Officer said, "Market acceptance of our newly introduced products was the major contributor to the year-over-year revenue growth. New products contributed to more than 10 percent of third quarter sales. While the pace of third quarter's top-line growth was slower than we experienced earlier in the year, demand in our primary end markets of paint and plastics continue to show strength, and order rates have accelerated during the first month of the fourth quarter."
"We've come a long way in diversifying our product and geographic mix in the past several years. The recent addition of several new large customers also diversifies our customer and geographic concentration. Greater diversification should improve our ability to deliver consistent growth in revenue and profitability," Dr. Karasch continued.
The Company said it expects to show sequential and year-over-year improvement in financial results during fourth quarter of fiscal 2010.
A webcast discussing third quarter 2010 results can be accessed for a period of 30 days via the News section of the TOR Minerals' website at www.torminerals.com.
Headquartered in Corpus Christi, Texas, TOR Minerals International, Inc. is a global manufacturer and marketer of specialty mineral and pigment products for high performance applications with manufacturing and regional offices located in the United States, Netherlands and Malaysia.
This statement provides forward-looking information as that term is defined in the Private Securities Litigation Reform Act of 1995, and, therefore, is subject to certain risks and uncertainties. There can be no assurance that the actual results, business conditions, business developments, losses and contingencies and local and foreign factors will not differ materially from those suggested in the forward-looking statements as a result of various factors, including market conditions, general economic conditions, including the present slow down in U.S. construction and the risks of a general business slow down or recession, the increasing cost of energy, raw materials and labor, competition, the receptivity of the markets for our anticipated new products, advances in technology, changes in foreign currency rates, freight price increase, commodity price increases, delays in delivery of required equipment and other factors.
Contact for Further Information:
David Mossberg
Three Part Advisors, LLC
(817) 310-0051
Financial Tables Follow
TOR Minerals International, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)
|
| | Three Months
Ended September 30, | | Nine Months
Ended September 30, |
| | 2010 | | 2009 | | 2010 | | 2009 |
NET SALES | $ | 7,543 | $ | 6,441 | $ | 22,327 | $ | 17,798 |
Cost of sales | | 6,234 | | 5,492 | | 17,765 | | 15,170 |
GROSS MARGIN | | 1,309 | | 949 | | 4,562 | | 2,628 |
Technical services and research and development | | 66 | | 54 | | 184 | | 146 |
Selling, general and administrative expenses | | 846 | | 687 | | 2,666 | | 2,423 |
OPERATING INCOME | | 397 | | 208 | | 1,712 | | 59 |
OTHER INCOME (EXPENSE): | | | | | | | | |
Interest income | | - | | - | | - | | 2 |
Interest expense | | (110) | | (159) | | (343) | | (407) |
Gain (loss) on foreign currency exchange rate | | (53) | | (5) | | (47) | | 37 |
Other, net | | - | | - | | - | | 4 |
INCOME (LOSS) BEFORE INCOME TAX | | 234 | | 44 | | 1,322 | | (305) |
Income tax expense (benefit) | | (2) | | 61 | | 32 | | (11) |
NET INCOME (LOSS) | $ | 236 | $ | (17) | $ | 1,290 | $ | (294) |
Less: Preferred Stock Dividends | | 15 | | 15 | | 45 | | 45 |
Income (Loss) Available to Common Shareholders | $ | 221 | $ | (32) | $ | 1,245 | $ | (339) |
| | | | | | | | |
Income (loss) per common share: | | | | | | | | |
Basic | $ | 0.12 | $ | (0.02) | $ | 0.66 | $ | (0.18) |
Diluted | $ | 0.09 | $ | (0.02) | $ | 0.51 | $ | (0.18) |
Weighted average common shares outstanding: | | | | | | | | |
Basic | | 1,908 | | 1,891 | | 1,899 | | 1,891 |
Diluted | | 2,586 | | 1,891 | | 2,455 | | 1,891 |
TOR Minerals International, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands, except share and per share amounts)
|
| | September 30,
2010 | | December 31,
2009 |
| | (Unaudited) | | |
ASSETS | | | | |
CURRENT ASSETS: | | | | |
Cash and cash equivalents | $ | 564 | $ | 1,002 |
Trade accounts receivable, net | | 4,016 | | 3,380 |
Inventories | | 10,403 | | 9,101 |
Other current assets | | 888 | | 540 |
Total current assets | | 15,871 | | 14,023 |
PROPERTY, PLANT AND EQUIPMENT, net | | 18,901 | | 18,800 |
OTHER ASSETS | | 45 | | 53 |
Total Assets | $ | 34,817 | $ | 32,876 |
| | | | |
LIABILITIES AND SHAREHOLDERS' EQUITY | | | | |
CURRENT LIABILITIES: | | | | |
Accounts payable | $ | 2,075 | $ | 1,452 |
Accrued expenses | | 1,443 | | 1,036 |
Notes payable under lines of credit | | 1,529 | | 3,313 |
Export credit refinancing facility | | 477 | | - |
Current deferred tax liability | | 50 | | 60 |
Current maturities - capital leases | | 68 | | 140 |
Current maturities of long-term debt - financial institutions | | 211 | | 435 |
Total current liabilities | | 5,853 | | 6,436 |
LONG-TERM DEBT, EXCLUDING CURRENT MATURITIES | | | | |
Capital leases | | 20 | | 49 |
Long-term debt - financial institutions | | 1,254 | | 1,477 |
Long-term debt - convertible debentures, net | | 1,197 | | 1,122 |
DEFERRED TAX LIABILITY | | 664 | | 577 |
Total liabilities | | 8,988 | | 9,661 |
COMMITMENTS AND CONTINGENCIES | | | | |
SHAREHOLDERS' EQUITY: | | | | |
Series A 6% convertible preferred stock $.01 par value:
authorized, 5,000 shares; 200 shares issued and
outstanding at 9/30/2010 and 12/31/2009 | | 2 | | 2 |
Common stock $1.25 par value: authorized, 6,000 shares;
1,909 and 1,891 shares issued and outstanding
at 9/30/2010 and 12/31/2009, respectively | | 2,386 | | 2,363 |
Additional paid-in capital | | 25,308 | | 25,214 |
Accumulated deficit | | (6,562) | | (7,807) |
Accumulated other comprehensive income: | | | | |
Cumulative translation adjustment | | 4,695 | | 3,443 |
Total shareholders' equity | | 25,829 | | 23,215 |
Total Liabilities and Shareholders' Equity | $ | 34,817 | $ | 32,876 |
TOR Minerals International, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
|
| | Nine Months Ended September 30, |
| | 2010 | | 2009 |
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | |
Net Income (Loss) | $ | 1,290 | $ | (294) |
Adjustments to reconcile net income (loss) to net cash
provided by operating activities: | | | | |
Depreciation | | 1,421 | | 1,340 |
Share-based compensation | | 91 | | 78 |
Warrant interest expense | | 50 | | 27 |
Deferred income taxes | | 32 | | (17) |
Provision for bad debts | | - | | (61) |
Changes in working capital: | | | | |
Trade accounts receivables | | (640) | | (384) |
Inventories | | (827) | | 2,056 |
Other current assets | | (339) | | (324) |
Accounts payable and accrued expenses | | 972 | | (1,436) |
Net cash provided by operating activities | | 2,050 | | 985 |
| | | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | |
Additions to property, plant and equipment | | (1,026) | | (807) |
Proceeds from sales of property, plant and equipment | | 17 | | - |
Net cash used in investing activities | | (1,009) | | (807) |
| | | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | |
Net (payments on) proceeds from lines of credit | | (1,725) | | 926 |
Net proceeds from (payments on) export credit refinancing facility | | 477 | | (432) |
Payments on capital lease | | (96) | | (4) |
Payments on long-term bank debt | | (399) | | (1,208) |
Proceeds from convertible debentures | | - | | 1,500 |
Proceeds from the issuance of common stock,
and exercise of common stock options | | 51 | | - |
Preferred stock dividends paid | | (45) | | (45) |
Net cash (used in) provided by financing activities | | (1,737) | | 737 |
Effect of exchange rate fluctuations on cash and cash equivalents | | 258 | | (213) |
Net (decrease) increase in cash and cash equivalents | | (438) | | 702 |
Cash and cash equivalents at beginning of year | | 1,002 | | 191 |
Cash and cash equivalents at end of period | $ | 564 | $ | 893 |
Supplemental cash flow disclosures: | | | | |
Interest paid | $ | 343 | $ | 377 |
