Exhibit 99.1
For further information, contact: Jennifer Melsheimer
Investor Relations Manager
847.394.8730
AMCOL INTERNATIONAL (NYSE:ACO) REPORTS
35 PERCENT INCREASE IN DILUTED EARNINGS PER SHARE OVER 2005 FIRST QUARTER
ARLINGTON HEIGHTS, ILL., April 21, 2006--AMCOL International Corporation
(NYSE:ACO) today reported 2006 first quarter net income of $9.7 million or $0.31
per diluted share, compared with $7.0 million or $0.23 per diluted share in the
same prior-year period.
Net sales rose 17 percent to $142.8 million for the quarter ended March 31,
2006, compared with $122.1 million for the period in 2005. Operating profit grew
over the 2005 first quarter by 46 percent to $12.0 million.
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.
Larry Washow, AMCOL president and chief executive officer said, "The first
quarter is always difficult to predict so we are very pleased with the results
overall. We anticipated positive year-over-year comparisons with good growth in
earnings, but further benefited from a dramatically improved Oilfield Services
Group performance. By continuing to focus our resources on driving improvements
in diversified targeted, global markets, we expect to continue to see the
benefits in our earnings."
Washow noted, "While the U.S. metalcasting business is not as robust as it has
been in recent quarters, we continue to focus on expansion of that market
globally, adding to our year-over-year minerals' growth. As part of our
Specialty Materials Group, detergents is still somewhat soft in the European
market. However, we expect to gain from positive international developments in
our detergent business as the year progresses. Not surprisingly our Petroleum
Products sales are very strong. Our Pet Products Group is focusing on building
sales momentum and improving margin structure."
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AMCOL Q1 2006 EARNINGS
PAGE 2 OF 7
"The first quarter is usually fairly modest for our environmental segment but
this year the segment delivered very strong growth in operating profits of 51
percent, benefiting from the high demand for our oil related services and a
strong, early European construction market. Our continued development of
products and services within the segment's markets has been an important driver
providing growth in our Lining Technology, Building Materials and Oilfield
Services Groups," Washow commented.
Washow continued, "The majority of the general, selling and administrative
spending increase is related to supporting growth in the environmental segment."
FINANCIAL OVERVIEW
Operating Results
The Environmental segment accounted for approximately 62 percent of the sales
growth in the first quarter. The Minerals and Transportation segments
contributed approximately 32 and 6 percent, respectively.
Gross margin for the quarter was 25.0 percent compared with 24.3 percent in the
prior-year first quarter. The Minerals segment gross margin improved by 30 basis
points, while the Environmental segment remained constant and the Transportation
segment declined by 40 basis points.
General, selling and administrative expenses were $23.7 million in the 2006
first quarter, an increase of $2.2 million or 10 percent over the 2005 period.
The Environmental segment accounted for a majority of the increase over 2005,
primarily due to higher personnel and product warranty expenses. Research and
development expenses were approximately $1.5 million in the first quarter of
2006.
Operating margin for the quarter was 8.4 percent compared with 6.7 percent in
the prior-year period. Margins improved in all segments.
The Company's effective tax rate was 28.9 percent for the first quarter of 2006
versus 19.1 percent for the same period in 2005. The 2006 quarter included
additional expense for adjustments related to previously recorded tax
liabilities. Excluding the adjustments, the tax rate would have been 27.7
percent. The 2005 tax rate was favorably impacted from changes in estimates of
tax liabilities. Those adjustments added $0.03 per diluted share to earnings in
the first quarter of 2005.
Income from affiliates and joint ventures contributed approximately $0.04 per
diluted share in the 2006 first quarter compared with $0.02 per diluted share in
the prior-year period. Higher earnings from the Company's India-based
investments accounted for the increase over the 2005 first quarter results.
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AMCOL Q1 2006 EARNINGS
PAGE 3 OF 7
The weighted average number of common and common equivalent shares was 30.9
million for the quarter ended March 31, 2006, compared with 30.8 million in the
prior-year period.
Financial Position
Long-term debt amounted to $47.7 million at March 31, 2006 compared to $34.8
million at December 31, 2005. Debt represented 16 percent of total
capitalization at March 31, 2006, compared to 12 percent at December 31, 2005.
Cash and cash equivalents were $13.5 million at March 31, 2006 compared with
$16.0 million at the end of 2005.
Working capital increased to $161.1 million at March 31, 2006 from $147.9
million at December 31, 2005, which also had the effect of increasing the
current ratio to 3.9-to-1 versus 3.3-to-1.
Cash flow used in operating activities was $4.0 million for the quarter ending
March 31, 2006 as compared to $2.7 million being provided in the prior-year
period.
Capital expenditures amounted to $9.3 million for the quarter ended March 31,
2006, compared with $5.2 million for the same period in 2005.
During the first quarter of 2006, the Company repurchased 40 thousand shares of
its common stock for $1.1 million, or an average price of $26.89 per share. $7.0
million remains available in the stock repurchase program approved by the Board
of Directors in May 2004.
This release contains certain forward-looking statements regarding AMCOL's
expected performance for future periods and actual results for such periods
might materially differ. Such forward-looking statements are subject to
uncertainties, which include, but are not limited to, actual growth in AMCOL's
various markets, utilization of AMCOL's plants, currency exchange rates,
currency devaluation, delays in development, production and marketing of new
products, integration of acquired businesses, and other factors detailed from
time to time in AMCOL's annual report and other reports filed with the
Securities and Exchange Commission.
AMCOL International, 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, Inc. AMCOL's common stock is traded on the New York
Stock Exchange under the symbol ACO. AMCOL's web address is www.amcol.com.
AMCOL's first quarter conference call will be available live today at 11 a.m.
EDT on the AMCOL website.
================================================================================
Financial tables follow.
AMCOL Q1 2006 EARNINGS
PAGE 4 OF 7
AMCOL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share data)
THREE MONTHS ENDED
MARCH 31,
---------------------------
2006 2005
------------ ------------
Net sales $ 142,764 $ 122,050
Cost of sales 107,035 92,370
------------ ------------
Gross profit 35,729 29,680
General, selling and administrative expenses 23,682 21,445
------------ ------------
Operating profit 12,047 8,235
------------ ------------
OTHER INCOME (EXPENSE):
Interest expense, net (477) (361)
Other, net 212 (105)
------------ ------------
(265) (466)
------------ ------------
Income before income taxes and income
from affiliates and joint ventures 11,782 7,769
Income tax expense (benefit) 3,408 1,484
------------ ------------
Income before income from affiliates and joint
ventures 8,374 6,285
Income from affiliates and joint ventures 1,337 667
------------ ------------
Net income $ 9,711 $ 6,952
============ ============
Weighted average common shares outstanding 29,773,953 29,333,627
============ ============
Weighted average common and common
equivalent shares outstanding 30,894,234 30,769,482
============ ============
Basic earnings per share $ 0.33 $ 0.24
============ ============
Diluted earnings per share $ 0.31 $ 0.23
============ ============
Dividends declared per share $ 0.11 $ 0.09
============ ============
AMCOL Q1 2006 EARNINGS
PAGE 5 OF 7
AMCOL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
MARCH 31, DECEMBER 31,
2006 2005
------------ ------------
(unaudited) *
ASSETS
CURRENT ASSETS:
Cash $ 13,449 $ 15,997
Accounts receivable, net 111,529 101,725
Inventories 76,044 77,928
Prepaid expenses 7,028 6,595
Income taxes receivable 3,478 3,698
Current deferred tax assets 4,334 4,864
Assets held for sale 402 402
------------ ------------
Total current assets 216,264 211,209
------------ ------------
Investment in and advances to affiliates and
joint ventures 21,189 19,730
------------ ------------
PROPERTY, PLANT, EQUIPMENT, MINERAL RIGHTS AND
RESERVES:
Land and mineral rights 13,845 12,761
Depreciable assets 260,292 252,430
------------ ------------
274,137 265,191
Less: accumulated depreciation 169,384 165,127
------------ ------------
104,753 100,064
------------ ------------
OTHER ASSETS:
Goodwill 20,850 20,644
Intangible assets, net 2,759 3,009
Deferred tax assets 5,190 4,579
Other assets 11,155 9,294
------------ ------------
39,954 37,526
------------ ------------
$ 382,160 $ 368,529
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 25,934 $ 24,722
Accrued liabilities 29,214 38,547
------------ ------------
Total current liabilities 55,148 63,269
------------ ------------
Long-term debt 47,710 34,838
------------ ------------
Minority interests in subsidiaries 262 259
Deferred compensation 7,631 7,045
Other liabilities 13,400 14,262
------------ ------------
21,293 21,566
------------ ------------
STOCKHOLDERS' EQUITY:
Common stock 320 320
Additional paid in capital 74,569 72,194
Retained earnings 190,542 184,125
Accumulated other comprehensive income 9,575 8,644
------------ ------------
275,006 265,283
LESS:
Treasury stock 16,997 16,427
------------ ------------
258,009 248,856
------------ ------------
$ 382,160 $ 368,529
============ ============
* Condensed from audited financial statements.
AMCOL Q1 2006 EARNINGS
PAGE 6 OF 7
AMCOL INTERNATIONAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(In thousands)
THREE MONTHS ENDED
MARCH 31,
---------------------------
2006 2005
------------ ------------
CASH FLOW FROM OPERATING ACTIVITIES:
Net income $ 9,711 $ 6,952
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Depreciation, depletion, and amortization 4,907 4,885
CHANGES IN ASSETS AND LIABILITIES, NET OF
EFFECTS OF ACQUISITIONS:
Increase in current assets (7,873) (7,290)
Increase in noncurrent assets (2,610) (3,059)
Increase (decrease) in current liabilities (6,929) 1,624
Increase (decrease) in noncurrent liabilities (276) (251)
Other (931) (184)
------------ ------------
Net cash provided by (used in) operating
activities (4,001) 2,677
------------ ------------
CASH FLOW FROM INVESTING ACTIVITIES:
Acquisition of land, mineral rights, and depreciable
assets (9,311) (5,157)
Acquisitions, net of cash (1,289) (1,632)
Other 162 1,129
------------ ------------
Net cash provided by (used in) investing activities (10,438) (5,660)
------------ ------------
CASH FLOW FROM FINANCING ACTIVITIES:
Net change in outstanding debt 12,491 7,821
Proceeds from sales of treasury stock 1,373 550
Purchases of treasury stock (1,075) -
Dividends paid (3,291) (2,656)
Other 1,650 -
------------ ------------
Net cash provided by (used in) financing activities 11,148 5,715
------------ ------------
Effect of foreign currency rate changes on cash 743 (825)
------------ ------------
Net increase (decrease) in cash and cash equivalents (2,548) 1,907
------------ ------------
Cash and cash equivalents at beginning of period 15,997 17,594
------------ ------------
Cash and cash equivalents at end of period $ 13,449 $ 19,501
============ ============
AMCOL Q1 2006 EARNINGS
PAGE 7 OF 7
AMCOL INTERNATIONAL CORPORATION
SEGMENT RESULTS (unaudited)
THREE MONTHS ENDED MARCH 31,
---------------------------------------------------------------------------
MINERALS 2006 2005 2006 VS. 2005
- ------------------------------ ----------------------- ----------------------- -----------------------
(Dollars in Thousands)
Net sales $ 80,071 100.0% $ 73,448 100.0% $ 6,623 9.0%
Cost of sales 65,179 81.4% 59,974 81.7% 5,205 8.7%
---------- ---------- ---------- ---------- ----------
Gross profit 14,892 18.6% 13,474 18.3% 1,418 10.5%
General, selling and
administrative expenses 6,125 7.6% 5,679 7.7% 446 7.9%
---------- ---------- ---------- ---------- ----------
Operating profit 8,767 10.9% 7,795 10.6% 972 12.5%
THREE MONTHS ENDED MARCH 31,
---------------------------------------------------------------------------
ENVIRONMENTAL 2006 2005 2006 VS. 2005
- ------------------------------ ----------------------- ----------------------- -----------------------
(Dollars in Thousands)
Net sales $ 55,130 100.0% $ 42,304 100.0% $ 12,826 30.3%
Cost of sales 35,775 64.9% 27,444 64.9% 8,331 30.4%
---------- ---------- ---------- ---------- ----------
Gross profit 19,355 35.1% 14,860 35.1% 4,495 30.2%
General, selling and
administrative expenses 11,624 21.1% 9,723 23.0% 1,901 19.6%
---------- ---------- ---------- ---------- ----------
Operating profit 7,731 14.0% 5,137 12.1% 2,594 50.5%
THREE MONTHS ENDED MARCH 31,
---------------------------------------------------------------------------
TRANSPORTATION 2006 2005 2006 VS. 2005
- ------------------------------ ----------------------- ----------------------- -----------------------
(Dollars in Thousands)
Net sales $ 12,471 100.0% $ 10,985 100.0% $ 1,486 13.5%
Cost of sales 10,989 88.1% 9,639 87.7% 1,350 14.0%
---------- ---------- ---------- ---------- ----------
Gross profit 1,482 11.9% 1,346 12.3% 136 10.1%
General, selling and
administrative expenses 799 6.4% 773 7.0% 26 3.4%
---------- ---------- ---------- ---------- ----------
Operating profit 683 5.5% 573 5.2% 110 19.2%
THREE MONTHS ENDED MARCH 31,
-------------------------------------------------
CORPORATE 2006 2005 2006 vs. 2005
- ------------------------------ ---------- ---------- -----------------------
(Dollars in Thousands)
Intersegment shipping sales $ (4,908) $ (4,687)
Intersegment shipping costs (4,908) (4,687)
---------- ----------
Gross profit - -
Corporate general, selling
and administrative expenses 4,255 4,361 (106) -2.4%
Nanocomposite business
development expenses 879 909 (30) -3.3%
---------- ---------- ----------
Operating loss 5,134 5,270 (136) -2.6%