EXHIBIT 99
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IONICS REPORTS THIRD QUARTER AND NINE-MONTH RESULTS
WATERTOWN, MA, November 4, 2003.......Ionics Incorporated (NYSE-ION) today
reported financial results for the quarter and nine months ended September 30,
2003. For the quarter, revenues of $90.6 million were up from $83.5 million for
the third quarter of 2002. The net loss for the quarter of $22.0 million
compared to net income of $0.4 million for the third quarter of 2002, and the
loss per share of $1.24 for the quarter compared to earnings per share of $0.02
for the third quarter of 2002.
Revenues for the first nine months of 2003 were $260.4 million compared to
$235.9 million for the first nine months of 2002. The net loss for the first
nine months of 2003 was $26.4 million, or $1.50 per share, compared to net
income of $3.1 million, or $0.18 per share, for the first nine months of 2002.
Ending backlog on September 30, 2003 was $332.7 million, compared to $388.5
million one year earlier and $346.1 million on June 30, 2003.
The results for the quarter included $12.7 million in goodwill impairment
charges and $5.0 million in restructuring and impairment expense, which included
$2.5 million for severance associated with the Company's restructuring plan, and
$2.5 million for asset impairment charges.
Also included in the results for the quarter were charges of $4.8 million
related to a product retrofit program and charges of $1.7 million related to the
Company's decision to shut down its European Home Water business. Additionally,
the Company incurred $0.8 million in charges associated with the decision to
shut down operations in its Watertec Australia business, and $0.8 million in
charges for the write-off of a receivable that is currently in litigation.
Due to the decision to divest the Company's Elite Consumer Product business, the
results for that business have been reflected as discontinued operations. This
amounted to a tax-effected loss of $3.7 million for the quarter.
Ionics will host a conference call today, Tuesday, November 4, 2003 at 5:00PM,
EST to discuss its third quarter financial results. This conference call will be
accessible on the Company's website at www.ionics.com. A recorded replay of the
conference call will also be accessible on our website for a two-week period
commencing later today. In addition, this press release will also be accessible
on our website promptly following its issuance.
ABOUT IONICS
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Ionics is a global separations technology company involved in the manufacture
and sale of membranes, equipment, systems and services for the purification,
disinfection, concentration and analysis of water, wastewater and ultrapure
water. Over a period of more than 50 years, Ionics has built more desalination
plants than any other company in the world. Ionics is a leader in the supply of
world-class ultrapure water systems for the power and microelectronics
industries, zero liquid discharge systems and in the measurement and analysis of
both total organic carbon and boron. For additional information, please visit
www.ionics.com.
Safe-harbor statement under the Private Securities Litigation Reform Act of
1995: Forward-looking statements in this news release involve risk and
uncertainty. The statements contained in this release which are not historical
facts are forward-looking statements. These forward-looking statements are based
on management's current views and assumptions and are neither promises nor
guarantees but are subject to risks, uncertainties and other factors that could
cause actual results to differ materially from management's current expectations
as described in such forward-looking statements, including overall economic and
business conditions; competitive factors, such as acceptance of new products,
pricing pressures and competition from competitors larger than the Company;
risks of nonpayment of accounts receivable, including those from affiliated
companies; risks associated with foreign operations; technological and product
development risks; availability of manufacturing capacity; and other factors
described in the Company's filings with the Securities and Exchange Commission,
including its annual report on Form 10-K for the year ended December 31, 2002.
You should not place undue reliance on the forward-looking statements in this
press release, and the Company disavows any obligation to update or supplement
those statements in the event of any changes in the facts, circumstances, or
expectations that underlie those statements.
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FOR MORE INFORMATION, CONTACT:
Theodore G. Papastavros
Executive Vice President and Treasurer
Ionics, Incorporated
Tel: (617) 673-4221
tpapastavros@ionics.com
IONICS REPORTS THIRD QUARTER AND NINE MONTHS RESULTS
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
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2003 2002 2003 2002
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(as restated) (as restated)
Revenues:
Equipment Business Group $ 39,272 $ 41,437 $ 109,386 $ 112,429
Ultrapure Water Group 26,662 25,169 75,526 75,354
Consumer Water Group 6,447 6,559 17,880 18,740
Instrument Business Group 7,112 6,990 21,671 20,344
Affiliated companies 11,135 3,330 35,918 9,022
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90,628 83,485 260,381 235,889
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Costs and expenses:
Cost of sales of Equipment Business Group 34,970 31,492 86,987 83,668
Cost of sales of Ultrapure Water Group 21,561 20,038 58,427 57,649
Cost of sales of Consumer Water Group 4,492 3,198 9,521 8,444
Cost of sales of Instrument Business Group 3,027 2,983 9,150 8,320
Cost of sales to affiliated companies 9,575 2,977 30,958 8,293
Research and development 1,784 1,617 5,515 4,832
Selling, general and administrative 24,732 21,209 69,752 62,179
Restructuring and impairment of long-lived assets 4,997 -- 4,997 --
Impairment of goodwill 12,731 -- 12,731 --
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117,869 83,514 288,038 233,385
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(Loss) income from continuing operations (27,241) (29) (27,657) 2,504
Interest income, net 425 469 1,480 1,394
Equity income (loss) 43 722 (2,800) 2,396
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(Loss) income from continuing operations before gain on
sale, income tax and minority interest expense (26,773) 1,162 (28,977) 6,294
Gain on sale of Aqua Cool 457 -- 457 --
Income tax (benefit) expense (8,260) 492 (9,076) 2,584
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(Loss) income from continuing operations before minority
interest expense (18,056) 670 (19,444) 3,710
Minority interest expense 249 283 634 708
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(Loss) income from continuing operations (18,305) 387 (20,078) 3,002
(Loss) income on discontinued operations, net of tax (3,727) (28) (6,302) 101
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Net (loss) income $ (22,032) $ 359 $ (26,380) $ 3,103
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Basic (loss) earnings per share from continuing operations $ (1.03) $ 0.02 $ (1.14) $ 0.17
Discontinued operations (0.21) (0.00) (0.36) 0.01
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Basic net (loss) earnings per share $ (1.24) $ 0.02 $ (1.50) $ 0.18
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Diluted (loss) earnings per share from continuing operations $ (1.03) $ 0.02 $ (1.14) $ 0.17
Discontinued operations (0.21) (0.00) (0.36) 0.01
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Diluted net (loss) earnings per share $ (1.24) $ 0.02 $ (1.50) $ 0.18
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Shares used in basic (loss) earnings per share calculations 17,699 17,552 17,607 17,537
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Shares used in diluted (loss) earnings per share calculations 17,699 17,597 17,607 17,694
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Backlog $ 332,666 $ 388,456
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IONICS REPORTS THIRD QUARTER AND NINE MONTH RESULTS
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
SEPTEMBER 30, DECEMBER 31,
2003 2002
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Current assets:
Cash and cash equivalents $ 130,208 $ 136,044
Restricted cash -- 4,250
Short-term investments 1,055 958
Notes receivable, current 6,626 6,645
Accounts receivable, net 82,432 92,715
Receivables from affiliated companies 28,680 23,642
Inventories 26,144 30,676
Assets from discontinued operations 9,044 20,637
Other current assets 32,316 26,459
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Total current assets 316,505 342,026
Receivables from affiliated companies, long-term 19,490 11,740
Notes receivable, long-term, net 26,631 24,718
Investments in affiliated companies 19,918 22,618
Property, plant and equipment, net 171,678 166,795
Other assets 37,162 40,116
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Total assets $ 591,384 $ 608,013
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Current liabilities:
Notes payable and current portion of long-term debt $ 5,677 $ 4,134
Accounts payable 28,141 35,678
Deferred revenue and advances from affiliated companies 7,833 4,308
Liabilities from discontinued operations 1,246 486
Other current liabilities 74,609 69,562
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Total current liabilities 117,506 114,168
Long-term debt and notes payable 8,797 9,670
Deferred income taxes 32,294 35,337
Deferred revenue from affiliated companies, long-term 4,011 4,662
Other liabilities 4,870 6,023
Stockholders' equity 423,906 438,153
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Total liabilities and stockholders' equity $ 591,384 $ 608,013
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