Exhibit 99.1
AMCOL INTERNATIONAL (NYSE: ACO) REPORTS 24 PERCENT INCREASE IN DILUTED
EARNINGS PER SHARE FROM CONTINUING OPERATIONS OVER 2004 SECOND QUARTER
AND INCOME OF $0.15 FROM DISCONTINUED OPERATIONS
ARLINGTON HEIGHTS, Ill., July 22 /PRNewswire-FirstCall/ -- AMCOL
International Corp. (NYSE: ACO) today reported that second quarter net income
was $14.3 million, or $0.46 per diluted share. Earnings from continuing
operations were $9.5 million, or $0.31 per diluted share, compared with $7.7
million, or $0.25 per diluted share, in the prior year quarter. AMCOL reported
net sales of $136.3 million for the quarter ended June 30, 2005, compared with
$119.8 million for the same period in 2004. This release should be read in
conjunction with the attached unaudited condensed consolidated financial
statements. Further discussion of items and events impacting earnings are
included in the financial overview.
The Company also reported a gain from discontinued operations of $0.15 per
diluted share reflecting a state income tax refund associated with the absorbent
polymers segment that was sold in the second quarter of 2000.
Larry Washow, president and chief executive officer, said, "The sustained
growth in our major market segments, mineral and environmental, is shown in
AMCOL's current financial results. We continue to incur significant expenses to
comply with Sarbanes-Oxley. Additionally, the strengthening of the dollar during
the second quarter had a negative impact on earnings."
For the six-month period ended June 30, 2005, net sales were $258.4 million
compared to $223.9 million in the prior-year period. Net income was $21.2
million, or $0.69 per diluted share, compared with $12.8 million, or $0.42 per
diluted share in the same period of 2004.
Washow commented, "In our minerals segment, our metalcasting group saw
revenue and profit increases despite the continuing cost pressure. This group
has witnessed solid demand from the automotive sector and strong demand from the
heavy equipment sectors. Our pet products group operated in a difficult
environment with upward pressure on packaging material costs and continued
increases in shipping costs. The international business continues to grow, with
our China operations having a record quarter."
Washow noted, "Revenues in our environmental segment continue to be strong.
The growth in our oilfield services group demonstrates our ability to attract
customers with innovative products and to make accretive acquisitions that add
to growth. Lining technology and building material sales continue to be healthy,
both domestically and overseas. We are encouraged by the accelerating global
sales contributions in the environmental segment, especially our Asian
operations."
FINANCIAL OVERVIEW
Gross profit for the quarter benefited from legislation enacted by the State
of Montana exempting certain minerals, including bentonite, in the state during
2004. As a result of the legislation, the Company recorded a $1.9 million
reduction to cost of goods sold in its mineral segment in the second quarter.
General, selling and administrative expenses were $23.1 million in the 2005
second quarter, an increase of $2.6 million or 13 percent over the 2004 period.
Approximately $1.0 million of the increase is associated with professional fees
related to the audit of the consolidated financial statements and report on
internal controls over financial reporting for the year ended December 31, 2004.
The Company expects the costs for professional services relating to external
audit services and Sarbanes - Oxley compliance to be approximately $0.4 million
per quarter for the remainder of the year. Stock compensation costs accounted
for approximately $0.2 million of the increase over the second quarter 2004
period.
The Company's effective tax rate was 24.5 percent for the second quarter of
2005 versus 31.5 percent for the same period in 2004. The tax rate in 2005 has
benefited from higher estimated depletion deductions and greater income earned
from foreign countries, which usually have lower statutory income tax rates.
Other expense includes approximately $0.9 million in foreign exchange losses
due to the strengthening U.S. dollar, particularly against the British Pound and
Euro.
During the first half of 2005, the Company did not repurchase any of its
common stock; $10 million remains available in the stock repurchase program
approved by the Board of Directors in May 2004.
The weighted average number of common and common equivalent shares
outstanding at June 30, 2005 was 30.8 million compared to approximately 30.9
million in the prior year. Weighted average common and common equivalent shares
outstanding decreased less than 1 percent for both the quarter and six months
ended June 30, 2005, respectively.
Long-term debt amounted to $44.6 million at June 30, 2005, compared with
$34.3 million at December 31, 2004. Debt represented 16 percent of total
capitalization at June 30, 2005, compared with 13 percent at December 31, 2004.
Cash and cash equivalents were $14.4 million at June 30, 2005, compared with
$17.6 million at the end of 2004. AMCOL's financial condition at June 30, 2005,
included working capital of approximately $152.3 million and a current ratio of
3.8-to-1, compared to approximately $129.4 million and a current ratio of
3.1-to-1 at December 31, 2004.
AMCOL International Corporation, headquartered in Arlington Heights, Ill.,
produces and markets a wide range of specialty mineral products used for
industrial, environmental and consumer-related applications. AMCOL is the
parent of American Colloid Co., CETCO (Colloid Environmental Technologies
Co.), Volclay International, Nanocor and the transportation operations,
Ameri-co Carriers, Inc. and Ameri-Co Logistics. AMCOL's common stock is
traded on the New York Stock Exchange under the symbol ACO.
As previously announced, AMCOL will hold an audio webcast at 11 a.m. EDT
today with Larry Washow and Gary Castagna to discuss additional details
regarding the Company's performance for the quarter and other forward-looking
information. The session may be accessed at http://www.amcol.com . The webcast
will be available for replay through the close of business on Friday, July 29,
2005 at which time a transcript of the webcast will be posted on the AMCOL
website.
Financial tables follow.
AMCOL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(In thousands, except share data)
Six months ended Three months ended
June 30, June 30,
---------------------------- ----------------------------
2005 2004 2005 2004
------------ ------------ ------------ ------------
Continuing
Operations
Net sales (1) $ 258,394 $ 223,924 $ 136,344 $ 119,770
Cost of sales 192,146 165,511 99,776 88,080
Gross profit (1) 66,248 58,413 36,568 31,690
General, selling and
administrative
expenses (1) 44,552 40,017 23,107 20,534
Operating profit 21,696 18,396 13,461 11,156
Other income
(expense):
Interest expense, net (805) (390) (444) (311)
Other, net (991) 27 (886) (16)
(1,796) (363) (1,330) (327)
Income before income
taxes and equity
in income of joint
ventures 19,900 18,033 12,131 10,829
Income tax expense 4,457 5,679 2,973 3,410
Income before equity
in income of
joint ventures 15,443 12,354 9,158 7,419
Income from joint
ventures 1,027 469 360 321
Income from
continuing
operations 16,470 12,823 9,518 7,740
Discontinued
Operations
Gain on 2000
disposal (including
income tax benefits
of $5,255 in 2005) 4,755 - 4,755 -
Income from
discontinued
operations 4,755 - 4,755 -
Net income $ 21,225 $ 12,823 $ 14,273 $ 7,740
Weighted average
common shares
outstanding 29,407,401 29,091,621 29,480,365 29,090,587
Weighted average
common and common
equivalent shares
outstanding 30,772,428 30,859,545 30,773,198 30,835,691
Basic earnings per
share:
Continuing
operations $ 0.56 $ 0.44 $ 0.32 $ 0.27
Discontinued
operations:
Gain on disposal 0.16 - 0.16 -
0.16 - 0.16 -
Net income $ 0.72 $ 0.44 $ 0.48 $ 0.27
Diluted earnings per
share:
Continuing
operations $ 0.54 $ 0.42 $ 0.31 $ 0.25
Discontinued
operations:
Gain on disposal 0.15 - 0.15 -
0.15 - 0.15 -
Net income $ 0.69 $ 0.42 $ 0.46 $ 0.25
Dividends declared
per share $ 0.180 $ 0.140 $ 0.090 $ 0.070
AMCOL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, December 31,
2005 2004
------------ ------------
(unaudited) *
ASSETS
Current assets:
Cash $ 14,438 $ 17,594
Accounts receivable, net 100,039 88,342
Inventories 67,073 63,882
Prepaid expenses 8,701 7,111
Income taxes receivable 12,447 9,126
Current deferred tax assets 4,366 4,293
Assets held for sale 381 752
Total current assets 207,445 191,100
Investment in and advances to joint
ventures 18,302 15,023
Property, plant, equipment, and
mineral rights and reserves:
Land and mineral rights 12,539 12,019
Depreciable assets 241,651 247,280
254,190 259,299
Less: accumulated depreciation 161,174 165,658
93,016 93,641
Other assets:
Goodwill 18,498 19,225
Intangible assets, net 3,249 3,802
Deferred tax assets 5,285 6,444
Other assets 9,008 7,207
36,040 36,678
$ 354,803 $ 336,442
June 30, December 31,
2005 2004
------------ ------------
(unaudited) *
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 25,653 25,474
Accrued liabilities 29,519 36,207
Total current liabilities 55,172 61,681
Long-term debt 44,550 34,295
Minority interests in subsidiaries 131 5
Deferred compensation 6,371 5,872
Other liabilities 12,477 12,655
18,979 18,532
Stockholders' equity:
Common stock 320 320
Additional paid in capital 71,285 69,763
Retained earnings 170,267 154,366
Accumulated other comprehensive income 9,754 14,905
251,626 239,354
Less:
Treasury stock 15,524 17,420
236,102 221,934
$ 354,803 $ 336,442
(*) Condensed from audited financial statements.
AMCOL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(In thousands)
Six months ended
June 30,
----------------------------
2005 2004
------------ ------------
Cash flow from operating activities:
Income from continuing operations $ 16,470 $ 12,823
Adjustments to reconcile income from
continuing operations to net cash provided
by (used in) operating activities:
Depreciation, depletion, and amortization 9,828 9,586
Changes in assets and liabilities, net of
effects of acquisitions:
Increase in current assets (13,703) (29,193)
Increase in noncurrent assets (759) (1,511)
Increase (decrease) in
current liabilities (4,962) 8,371
Increase (decrease) in
noncurrent liabilities 321 1,135
Other (157) 1,515
Net cash provided by (used in)
operating activities 7,038 2,726
Net cash provided by discontinued operations - 8,625
Cash flow from investing activities:
Acquisition of land, mineral rights, and
depreciable assets (11,733) (7,446)
Acquisitions, net of cash (1,632) (13,335)
Other 75 1,441
Net cash used in investing activities (13,290) (19,340)
Cash flow from financing activities:
Net change in outstanding debt 10,255 17,651
Proceeds from sales of treasury stock 944 746
Purchases of treasury stock - (2,879)
Dividends paid (5,324) (4,091)
Net cash provided by financing activities 5,875 11,427
Effect of foreign currency rate changes on cash (2,779) (970)
Net increase (decrease) in cash and
cash equivalents (3,156) 2,468
Cash and cash equivalents at beginning of period 17,594 13,525
Cash and cash equivalents at end of period $ 14,438 $ 15,993
AMCOL INTERNATIONAL CORPORATION
SEGMENT RESULTS (unaudited)
(In thousands)
Three months ended June 30,
-----------------------------------------------------------------------
Minerals 2005 2004 2005 vs. 2004
- ---------------------- --------------------- --------------------- ---------------------
(Dollars in Thousands)
Net sales (1) $ 74,877 100.0% $ 66,710 100.0% $ 8,167 12.2%
Cost of sales 58,094 77.6% 52,930 79.3%
Gross
profit (1) 16,783 22.4% 13,780 20.7% 3,003 21.8%
General, selling
and administrative
expenses (1) 6,118 8.2% 5,527 8.3% 591 10.7%
Operating
profit 10,665 14.2% 8,253 12.4% 2,412 29.2%
Three months ended June 30,
-----------------------------------------------------------------------
Environmental 2005 2004 2005 vs. 2004
- ---------------------- --------------------- --------------------- ---------------------
(Dollars in Thousands)
Net sales (1) $ 53,834 100.0% $ 47,199 100.0% $ 6,635 14.1%
Cost of sales 35,585 66.1% 30,401 64.4%
Gross
profit (1) 18,249 33.9% 16,798 35.6% 1,451 8.6%
General, selling
and administrative
expenses (1) 10,742 20.0% 10,622 22.5% 120 1.1%
Operating
profit 7,507 13.9% 6,176 13.1% 1,331 21.6%
Three months ended June 30,
-----------------------------------------------------------------------
Transportation 2005 2004 2005 vs. 2004
- ---------------------- --------------------- --------------------- ---------------------
(Dollars in Thousands)
Net sales $ 12,595 100.0% $ 10,058 100.0% $ 2,537 25.2%
Cost of sales 11,059 87.8% 8,946 88.9%
Gross profit 1,536 12.2% 1,112 11.1% 424 38.1%
General, selling
and administrative
expenses 816 6.5% 661 6.6% 155 23.4%
Operating profit 720 5.7% 451 4.5% 269 59.6%
Three months ended June 30,
------------------------------------------------
Corporate 2005 2004 2005 vs. 2004
- ------------------------- --------- --------- ----------------------
(Dollars in Thousands)
Intersegment
shipping sales $ (4,962) $ (4,197)
Intersegment
shipping costs (4,962) (4,197)
Gross profit - -
Corporate general,
selling and
administrative
expenses 4,672 2,832 1,840 65.0%
Nanocomposite business
development expenses 759 892 (133) -14.9%
Operating loss (5,431) (3,724) (1,707) 45.8%
AMCOL INTERNATIONAL CORPORATION
SEGMENT RESULTS (unaudited)
(In thousands)
Six months ended June 30,
-----------------------------------------------------------------------
Minerals 2005 2004 2005 vs. 2004
- ---------------------- --------------------- --------------------- ---------------------
(Dollars in Thousands)
Net sales (1) $ 148,325 100.0% $ 131,047 100.0% $ 17,278 13.2%
Cost of sales 118,068 79.6% 104,382 79.7%
Gross
profit (1) 30,257 20.4% 26,665 20.3% 3,592 13.5%
General,
selling and
administrative
expenses (1) 11,797 8.0% 10,977 8.4% 820 7.5%
Operating
profit 18,460 12.4% 15,688 11.9% 2,772 17.7%
Six months ended June 30,
-----------------------------------------------------------------------
Environmental 2005 2004 2005 vs. 2004
- ---------------------- --------------------- --------------------- ---------------------
(Dollars in Thousands)
Net sales (1) $ 96,138 100.0% $ 80,871 100.0% $ 15,267 18.9%
Cost of sales 63,029 65.6% 51,272 63.4%
Gross
profit (1) 33,109 34.4% 29,599 36.6% 3,510 11.9%
General,
selling and
administrative
expenses (1) 20,465 21.3% 20,344 25.2% 121 0.6%
Operating
profit 12,644 13.1% 9,255 11.4% 3,389 36.6%
Six months ended June 30,
-----------------------------------------------------------------------
Transportation 2005 2004 2005 vs. 2004
- ---------------------- --------------------- --------------------- ---------------------
(Dollars in Thousands)
Net sales $ 23,580 100.0% $ 19,390 100.0% $ 4,190 21.6%
Cost of sales 20,698 87.8% 17,241 88.9%
Gross profit 2,882 12.2% 2,149 11.1% 733 34.1%
General,
selling and
administrative
expenses 1,589 6.7% 1,312 6.8% 277 21.1%
Operating profit 1,293 5.5% 837 4.3% 456 54.5%
Six months ended June 30,
------------------------------------------------
Corporate 2005 2004 2005 vs. 2004
- ------------------------- --------- --------- ----------------------
(Dollars in Thousands)
Intersegment shipping
sales $ (9,649) $ (7,384)
Intersegment shipping
costs (9,649) (7,384)
Gross profit - -
Corporate general,
selling and
administrative
expenses 9,033 5,578 3,455 61.9%
Nanocomposite business
development expenses 1,668 1,806 (138) -7.6%
Operating loss (10,701) (7,384) (3,317) 44.9%
(1) Beginning in the quarter ended March 31, 2005, the Company began reporting
certain expenses related to product liability, warranty and royalty
expenses in general, selling and administrative expenses rather than as
deductions from net sales. Thus, for the 2004 periods reported herein,
these deductions have been reclassified to conform to the current year
financial statement presentation. This change in financial statement
presentation did not impact reported net income or earnings per share.
SOURCE AMCOL International Corp.
-0- 07/22/2005
/CONTACT: Jennifer Melsheimer, Investor Relations Manager of AMCOL
International Corp., +1-847-394-8730/
/Web site: http://www.amcol.com /
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