Exhibit 99.1
SystemOne Technologies Reports Third Quarter 2003 Results
MIAMI, Florida, November 14, 2003—SystemOne Technologies Inc. (OTC BB:STEK.OB) today reported its third quarter 2003 operating results.
Revenues for the three months ended September 30, 2003 were $5,519,000 compared to revenues of $4,452,000 in the corresponding period of 2002, a 24.0% increase. The Company generated an operating profit for the three months ended September 30, 2003 of $1,102,000 compared with an operating profit of $822,000 in the corresponding period of 2002. The Company’s net income for the three months ended September 30, 2003 was $480,000 or a profit of 10 cents per share, compared with a net income of $97,000 or a profit of 2 cents per share, in the corresponding period of 2002. The Company’s net loss to common stock after preferred dividends for the three months ended September 30, 2003 was $86,000 or a loss of 2 cents per share, compared with a net loss of $440,000 or a loss of 9 cents per share, in the corresponding period of 2002.
Revenues for the nine months ended September 30, 2003 were $16,829,000 compared to revenues of $13,272,000 in the corresponding period of 2002, a 26.8% increase. The Company generated an operating profit for the nine months ended September 30, 2003 of $3,901,000 compared with an operating profit of $2,911,000 in the corresponding period of 2002. The Company’s net profit for the nine months ended September 30, 2003 was $1,926,000 or a profit of 39 cents per share, compared with a net profit of $586,000 or a profit of 12 cents per share, in the corresponding period of 2002. The Company’s net profit to common stock after preferred dividends for the nine months ended September 30, 2003 was $257,000 or a profit of 5 cents per share, compared with a net loss of $998,000 or a loss of 21 cents per share, in the corresponding period of 2002.
The Company has entered into a Marketing and Distribution Agreement with Hockman-Lewis Limited, an international distributor of automotive service equipment, under which Hockman-Lewis Limited has been appointed the exclusive marketer and distributor of, and service provider for, the Company’s parts, paint and other industrial washer equipment throughout the world other than North America and Puerto Rico.
The company anticipates that the bankruptcy court overseeing Safety-Kleen’s bankruptcy proceedings will consider approval of the termination agreement on November 24, 2003.
Founded in 1990, SystemOne Technologies designs, manufactures, sells and supports a full range of self contained, recycling industrial parts washing products for use in the automotive, aviation, marine and general industrial markets. The Company has been awarded eleven patents for its products which incorporate innovative, proprietary resource recovery and waste minimization technologies. The Company is headquartered in Miami, Florida.
This press release contains forward-looking statements regarding future events and the future performance of SystemOne Technologies that involves risks and uncertainties that could cause actual events to differ materially including the Company’s ability to sustain continuing improvements in revenues and profits. We refer you to the documents that SystemOne Technologies files from time to time with the Securities and Exchange Commission which contain important factors that could cause its results to differ from its current expectations.
CONTACT: SystemOne Technologies Inc.
Paul I. Mansur, Chief Executive Officer, 305/593-8015
SYSTEMONE TECHNOLOGIES INC.
CONDENSED BALANCE SHEETS
(In thousands, except share data)
September 30, | ||||||||||||
2003 | December 31, | |||||||||||
(Unaudited) | 2002 | |||||||||||
ASSETS Current assets: | ||||||||||||
Cash and cash equivalents | $ | 1,217 | $ | 505 | ||||||||
Receivables, net of allowance of $123 and $123 | 3,744 | 2,586 | ||||||||||
Inventories | 1,545 | 1,251 | ||||||||||
Prepaid and other assets | 207 | 384 | ||||||||||
Total current assets | 6,713 | 4,726 | ||||||||||
Property and equipment, net | 867 | 1,133 | ||||||||||
Non-current portion of receivables, net of discount | 2,220 | 2,009 | ||||||||||
Other assets | 222 | 316 | ||||||||||
Total assets | $ | 10,022 | $ | 8,184 | ||||||||
LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT | ||||||||||||
Current liabilities: | ||||||||||||
Accounts payable and accrued expenses | $ | 1,772 | $ | 1,253 | ||||||||
Warranty accrual | 315 | 435 | ||||||||||
Deferred revenue | 77 | 106 | ||||||||||
Current installments of long-term debt and obligations under capital leases | 287 | 142 | ||||||||||
Total current liabilities | 2,451 | 1,936 | ||||||||||
Long-term debt | 30,260 | 30,835 | ||||||||||
Warranty accrual, non-current | 211 | 239 | ||||||||||
Total liabilities | 32,922 | 33,010 | ||||||||||
Commitments & contingencies Redeemable convertible preferred stock, $1.00 par value per share. Authorized 1,500,000 shares, 193,522 and 182,270 issued and outstanding at liquidation value | 19,352 | 18,227 | ||||||||||
Less unamortized discount | (464 | ) | (1,008 | ) | ||||||||
Net redeemable convertible preferred stock | 18,888 | 17,219 | ||||||||||
Stockholders’ deficit: | ||||||||||||
Common stock, $0.001 par value per share. Authorized 25,000,000 shares, issued and outstanding 4,960,087 and 4,742,923 | 5 | 5 | ||||||||||
Additional paid-in capital | 20,723 | 20,723 | ||||||||||
Deficit | (62,516 | ) | (62,773 | ) | ||||||||
Total stockholders’ deficit | (41,788 | ) | (42,045 | ) | ||||||||
Total liabilities, redeemable convertible preferred stock and stockholders’ deficit | $ | 10,022 | $ | 8,184 | ||||||||
See accompanying notes to condensed financial statements (unaudited).
SYSTEMONE TECHNOLOGIES INC.
CONDENSED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
(Unaudited)
(In thousands, except share and per share data)
Three Months Ended | Nine Months Ended | |||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||
2003 | 2002 | 2003 | 2002 | |||||||||||||||
Revenue | $ | 5,519 | $ | 4,452 | $ | 16,829 | $ | 13,272 | ||||||||||
Cost of goods sold | 3,470 | 2,775 | 10,347 | 8,006 | ||||||||||||||
Gross profit | 2,049 | 1,677 | 6,482 | 5,266 | ||||||||||||||
Operating expenses: | ||||||||||||||||||
Selling, general and administrative | 863 | 770 | 2,306 | 2,200 | ||||||||||||||
Research and development | 84 | 85 | 275 | 230 | ||||||||||||||
Restructuring and other charges | (75 | ) | ||||||||||||||||
Total operating expenses | 947 | 855 | 2,581 | 2,355 | ||||||||||||||
Profit from operations | 1,102 | 822 | 3,901 | 2,911 | ||||||||||||||
Interest expense | (754 | ) | (823 | ) | (2,324 | ) | (2,584 | ) | ||||||||||
Interest income | 139 | 98 | 389 | 259 | ||||||||||||||
Interest expense, net | (615 | ) | (725 | ) | (1,935 | ) | (2,325 | ) | ||||||||||
Income before income tax provision | 487 | 97 | 1,966 | 586 | ||||||||||||||
Income tax provision | (7 | ) | — | (40 | ) | — | ||||||||||||
Net income | 480 | 97 | 1,926 | 586 | ||||||||||||||
Dividends and accretion of discount on redeemable convertible preferred stock | (566 | ) | (537 | ) | (1,669 | ) | (1,584 | ) | ||||||||||
Net (loss) income applicable to common shareholders | $ | (86 | ) | $ | (440 | ) | $ | 257 | $ | (998 | ) | |||||||
Basic net (loss) income per common share | $ | (.02 | ) | $ | (.09 | ) | $ | .05 | $ | (.21 | ) | |||||||
Diluted net (loss) income per common share | $ | (.02 | ) | $ | (.09 | ) | $ | .04 | $ | (.21 | ) | |||||||
Weighted average shares outstanding — basic | 4,960,087 | 4,742,923 | 4,928,903 | 4,742,923 | ||||||||||||||
Weighted average shares outstanding — diluted | 4,960,087 | 4,742,923 | 5,726,007 | 4,742,923 | ||||||||||||||
See accompanying notes to condensed financial statements (unaudited)