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8-K - 8-K - CALGON CARBON Corpd8k.htm

Exhibit 99.1

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CALGON CARBON ANNOUNCES SECOND QUARTER RESULTS

PITTSBURGH, PA – August 2, 2011 – Calgon Carbon Corporation (NYSE: CCC) announced results for the second quarter ended June 30, 2011.

The company reported net income of $11.3 million for the second quarter of 2011, as compared to net income of $2.9 million for the second quarter of 2010. On a fully diluted basis, net income per common share for the second quarter of 2011 was $0.20, as compared to $0.05 for the second quarter of 2010.

Income from operations for the second quarter of 2011 was $17.4 million, versus $4.3 million for the comparable period of 2010.

Both income from operations and net income for the second quarter of 2010 included an $11.5 million ($7.2 million after-tax) charge for a litigation contingency.

Net sales for the second quarter of 2011 were $135.3 million, an $11.7 million, or a 9.5%, increase over the comparable period in 2010. Currency translation had a $6.6 million positive impact on sales for the second quarter due to the weak dollar.

For the second quarter of 2011, sales for the Activated Carbon and Service segment increased 10.1%, as compared to the second quarter of 2010. The increase was due principally to higher demand for certain activated carbon and service products in the environmental water, environmental air, and food markets.

Equipment sales for the second quarter of 2011 increased 5.0% over the second quarter of 2010 due to higher revenue from ballast water treatment systems. For the second quarter of 2011, Consumer sales were comparable to the second quarter of 2010.

Net sales less the cost of products sold as a percentage of net sales for the second quarter of 2011 was 32.8% versus 34.8% for the second quarter of 2010. One

 

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percentage point of the decline was attributable to a $1.3 million charge related to the PreZerve® product line, which was previously disclosed as being discontinued. An increase in sales of lower margin outsourced carbon products also contributed to the decline.

Selling, administrative and research expenses for the second quarter of 2011 were comparable to the second quarter of 2010. As a percentage of sales, however, SG&A improved to 16.6% for the second quarter of 2011 versus 17.8% for the second quarter of 2010.

Environmental and litigation contingencies for the second quarter of 2011 included a $1.3 million reduction in the estimate to complete a remediation project at the company’s production facility in Columbus, Ohio. In the second quarter of 2010, the company recorded an $11.5 million litigation contingency charge.

Calgon Carbon’s board of directors did not declare a quarterly dividend.

Net sales for the six months ended June 30, 2011, were $259.7 million, a $33.2 million, or a 14.6%, increase over the comparable period in 2010. Of this increase, $17.9 million is attributable to an additional three months of Calgon Carbon Japan net revenue, since its results were fully consolidated as of April 1, 2010.

Results for the six months ended June 30, 2010, included a gain on acquisitions of $2.7 million.

Currency translation had a $7.5 million positive impact on sales for the first half of 2011 due to the weak dollar.

Net income for the six months ended June 30, 2011, was $19.8 million versus $12.4 million for the comparable period of 2010. Fully diluted net income per common share for the first half of 2011 was $0.35. Fully diluted net income per common share for the first half of 2010 was $0.22.

Commenting on the quarter, John Stanik, Calgon Carbon’s chairman, president and chief executive officer, said, “Calgon Carbon’s performance for the quarter was solid, as sales strengthened and mix improved as the quarter progressed. Margins also improved sequentially, excluding the effect of the PreZerve inventory charge.”

For more information about Calgon Carbon’s leading activated carbon and ultraviolet technology solutions for municipalities and industries, visit www.calgoncarbon.com.

Calgon Carbon Corporation, headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making water and air safer and cleaner.

This news release contains historical information and forward-looking statements. Forward-looking statements typically contain words such as “expect,” “believe,”

 

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“estimate,” “anticipate,” or similar words indicating that future outcomes are uncertain. Statements looking forward in time, including statements regarding future growth and profitability, price increases, cost savings, broader product lines, enhanced competitive posture and acquisitions, are included in the company’s most recent Annual Report pursuant to the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995. They involve known and unknown risks and uncertainties that may cause the company’s actual results in future periods to be materially different from any future performance suggested herein. Further, the company operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond the company’s control. Some of the factors that could affect future performance of the company are higher energy and raw material costs, costs of imports and related tariffs, labor relations, capital and environmental requirements, changes in foreign currency exchange rates, borrowing restrictions, validity of patents and other intellectual property, and pension costs. In the context of the forward-looking information provided in this news release, please refer to the discussions of risk factors and other information detailed in, as well as the other information contained in the company’s most recent Annual Report.

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Calgon Carbon Corporation

Condensed Consolidated Statement of Income

(Dollars in thousands except per share data)

(Unaudited)

 

     Quarter Ended     Six Months Ended  
     June 30,     June 30,  
     2011     2010     2011     2010  

Net Sales

   $ 135,298      $ 123,574      $ 259,678      $ 226,501   
  

 

 

   

 

 

   

 

 

   

 

 

 

Cost of Products Sold

     90,864        80,512        173,853        146,303   

Depreciation and Amortization

     5,655        5,261        11,195        10,338   

Selling, Administrative & Research

     22,499        22,044        44,831        41,695   

Environmental and Litigation Contingencies

     (1,135     11,500        (956     11,500   
  

 

 

   

 

 

   

 

 

   

 

 

 
     117,883        119,317        228,923        209,836   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from Operations

     17,415        4,257        30,755        16,665   

Interest - Net

     58        2        103        110   

Gain on Acquisitions

     —          —          —          2,666   

Other Expense - Net

     (46     (172     (236     (475
  

 

 

   

 

 

   

 

 

   

 

 

 

Income From Operations Before Income Tax and Equity in Income from Equity Investments

     17,427        4,087        30,622        18,966   

Income Tax Provision

     6,136        1,171        10,854        6,686   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from Operations Before Equity in Income from Equity Investments

     11,291        2,916        19,768        12,280   

Equity in Income from Equity Investments

     —          —          —          112   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income

   $ 11,291      $ 2,916      $ 19,768      $ 12,392   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income per Common Share

        

Basic

   $ .20      $ .05      $ .35      $ .22   

Diluted

   $ .20      $ .05      $ .35      $ .22   

Weighted Average Shares Outstanding (Thousands)

        

Basic

     56,188        55,830        56,156        55,770   

Diluted

     57,054        56,748        56,974        56,737   


Calgon Carbon Corporation

Segment Data:

 

Segment Sales

   2Q11     2Q10      YTD 2011     YTD 2010  

Activated Carbon and Service

     121,522        110,381         234,406        200,833   

Equipment

     11,681        11,129         20,798        21,289   

Consumer

     2,095        2,064         4,474        4,379   
  

 

 

   

 

 

    

 

 

   

 

 

 

Total Sales (thousands)

   $ 135,298      $ 123,574       $ 259,678      $ 226,501   

Segment

Operating Income (loss)*

   2Q11     2Q10      YTD 2011     YTD 2010  

Activated Carbon and Service

     24,890        9,275         43,957        26,962   

Equipment

     (484     243         (866     (72

Consumer

     (1,336     —           (1,141     113   
  

 

 

   

 

 

    

 

 

   

 

 

 

Income from Operations (thousands)

   $ 23,070      $ 9,518       $ 41,950      $ 27,003   

 

* Before depreciation and amortization. The 2011 quarter and year to date periods include a $1.3 million charge related to the PreZerve product line in the Consumer Segment as well as a $1.3 million reduction in an environmental liability in the Activated Carbon and Service segment. The 2010 quarter and year to date periods for the Activated Carbon and Service segment include a charge of $11.5 million related to a litigation contingency.


Calgon Carbon Corporation

Condensed Consolidated Balance Sheet

(Dollars in thousands)

(Unaudited)

 

     June 30,      December 31,  
     2011      2010  

Assets

     

Current assets:

     

Cash and cash equivalents

   $ 13,927       $ 33,992   

Restricted cash

     1,275         1,173   

Receivables

     92,490         94,354   

Inventories

     113,201         101,693   

Other current assets

     40,673         40,836   
  

 

 

    

 

 

 

Total current assets

     261,566         272,048   

Property, plant and equipment, net

     217,623         186,834   

Other assets

     41,738         42,681   
  

 

 

    

 

 

 

Total assets

   $ 520,927       $ 501,563   
  

 

 

    

 

 

 

Liabilities and Shareholders’ Equity

     

Current liabilities:

     

Short-term debt

   $ 18,019       $ 21,442   

Current portion of long-term debt

     3,010         3,203   

Other current liabilities

     72,773         80,529   
  

 

 

    

 

 

 

Total current liabilities

     93,802         105,174   

Long-term debt

     4,098         3,721   

Other liabilities

     52,631         49,430   
  

 

 

    

 

 

 

Total liabilities

     150,531         158,325   

Redeemable non-controlling interest

     —           274   

Total shareholders’ equity

     370,396         342,964   
  

 

 

    

 

 

 

Total liabilities and shareholders’ equity

   $ 520,927       $ 501,563