TOR Minerals Announces Fourth Quarter and Year End 2010 Financial Results

Reports Record Level of Annual Net Income

News provided by

TOR Minerals International

Feb 23, 2011, 04:00 ET

CORPUS CHRISTI, Texas, Feb. 23, 2011 /PRNewswire/ -- TOR Minerals International (Nasdaq: TORM), producer of synthetic titanium dioxide and color pigments, specialty aluminas, and other high performance mineral fillers, today announced its financial results for the fourth quarter and year ended December 31, 2010.

Highlights for the fourth quarter and 2010 included:

  • 2010 record net income: $2.3 million versus 2009 net loss: ($0.2) million
  • 2010 EPS: $0.83 versus 2009 net loss per share: ($0.10)
  • 2010 revenue increased 28% year over year to $31.0 million
  • 4Q10 EPS: $0.35 versus 4Q09 EPS: $0.08
  • 4Q10 revenue increased 36% year over year to $8.7 million

For the fourth quarter ended December 31, 2010, the Company reported net income available to common shareholders of $1,006,000, or $0.35 per diluted share, on net sales of $8,689,000.  This compares with a net income available to common shareholders of $143,000, or $0.08 per share, on net sales of $6,395,000 for the quarter ended December 31, 2009.  

Net sales for the year ended December 31, 2010, were $31,016,000 compared to $24,193,000 during the year ended December 31, 2009.  The net income available to common shareholders was $2,318,000, or $0.83 per diluted share, for the year ended December 31, 2010 compared to a net loss of $196,000, or ($0.10) per diluted share, for year ended December 31, 2009.

Product Groups

4Q10

4Q09

% Change

2010

2009

% Change

TiO2 Pigments

$  3,390

$  2,445

39%

$  12,595

$  10,123

24%

Specialty Aluminas

4,227

3,181

33%

14,242

11,096

28%

Other

1,072

769

39%

4,179

2,974

41%

Total

$  8,689

$  6,395

36%

$  31,016

$  24,193

28%












Net sales increased 36 percent during the fourth quarter of 2010 due to strong increases in all product categories.  During the fourth quarter, sales of titanium dioxide (TiO2) pigments, which include HITOX® and TIOPREM® products, increased 39 percent to $3.4 million benefiting from both increased prices and volumes.  Sales of specialty alumina, which includes ALUPREM®, HALTEX® and OPTILOAD® product groups, grew 33 percent during the fourth quarter of 2010 due to increased demand for existing and new products in Europe and North America.  Commenting on sales trends, Dr. Olaf Karasch, Chief Executive Officer, said, "Clearly our TiO2 pigment business is benefiting from an economic recovery in the paint and plastics markets.  In addition, the tight global supply of titanium dioxide gives us pricing power and is driving new and existing customers to use more of our specialty pigments in their formulation.   At the same time, our business is benefiting from increasing acceptance of new products, specifically TIOPREM and OPTILOAD. Combined with other specialty alumina products, newly introduced products accounted for more than 30 percent of growth during fourth quarter."  

During the fourth quarter of 2010, operating income increased to $1,091,000, or 12.6% of sales, compared to operating income of $302,000, or 4.7% of sales, reported during the fourth quarter of 2009.  For the year ended December 31, 2010, the Company reported record operating income of $2,803,000.  Year-over-year and sequential improvements in profitability resulted from increased sales levels and greater operational efficiencies, which were partially offset by increases in raw materials and energy costs. Dr. Karasch said, "Fourth quarter and annual improvements in profitability illustrated the leverage in our business model, as approximately thirty five cents of each incremental sales dollar fell to the bottom line during these periods."    

The Company said that sales momentum accelerated during the first six weeks of 2011 and that if this trend continues, it expects to see year-over-year improvement in financial results during the first quarter of 2011.  "As a result of the hard work done to lower our cost structure, improve efficiencies, and diversify our customer, end market, and geographic mix, 2010 net income was the highest in the Company's history.  Looking forward, with continued acceptance of our new products, favorable market conditions, and a lower, more efficient cost structure, we are in a great position to deliver above market growth in revenue and earnings," Dr. Karasch concluded.  

TOR Minerals will host a conference call at 4:00 p.m. Central Time on February 23, 2011 to further discuss fourth quarter results. The call will be simultaneously Webcast, and can be accessed via the News section on the Company's website at www.torminerals.com.  Interested parties may also access the conference call via telephone by dialing 877-407-8033.

Headquartered in Corpus Christi, Texas, TOR Minerals International is a global manufacturer and marketer of specialty mineral and pigment products for high performance applications with manufacturing and regional offices located in the United States, Netherlands and Malaysia.

This statement provides forward-looking information as that term is defined in the Private Securities Litigation Reform Act of 1995, and, therefore, is subject to certain risks and uncertainties. There can be no assurance that the actual results, business conditions, business developments, losses and contingencies and local and foreign factors will not differ materially from those suggested in the forward-looking statements as a result of various factors, including market conditions, general economic conditions, including the present slow down in U.S. construction and the risks of a general business slow down or recession, the increasing cost of energy, raw materials and labor, competition, the receptivity of the markets for our anticipated new products, advances in technology, changes in foreign currency rates, freight price increase, commodity price increases, delays in delivery of required equipment and other factors.

Contact for Further Information

Dave Mossberg,

Three Part Advisors, LLC

817 310-0051

TOR Minerals International, Inc. and Subsidiaries

Consolidated Statements of Operations

(In thousands, except per share amounts)




(Unaudited)



Three Months

Ended December 31,

Twelve Months

Ended December 31,


2010

2009

2010

2009

NET SALES

$

8,689

$

6,395

$

31,016

$

24,193

Cost of sales

6,493

5,212

24,258

20,382

GROSS MARGIN

2,196

1,183

6,758

3,811

Technical services and research and development

70

54

254

200

General, administrative and selling expenses

1,035

792

3,701

3,215

Loss on disposal of assets

-

35

-

35

OPERATING INCOME (LOSS)

1,091

302

2,803

361

OTHER INCOME (EXPENSE):







Interest income

-

-

-

2

Interest expense

(96)

(151)

(439)

(558)

Gain (loss) on foreign currency exchange rate

(13)

22

(60)

59

Other, net

-

-

-

4

INCOME (LOSS) BEFORE INCOME TAX

982

173

2,304

(132)

Income tax expense (benefit)

(16)

15

16

4

NET INCOME (LOSS)

$

998

$

158

$

2,288

$

(136)

Less:  Preferred Stock Dividends

15

15

60

60

Basic Income (Loss) Available to Common Shareholders

$

983

$

143

$

2,228

$

(196)

Plus: 6% Convertible Debenture Interest Expense

23

-

90

-

Diluted Income (Loss) Available to Common Shareholders

$

1,006

$

143

$

2,318

$

(196)









Income (loss) per common share:







Basic

$

0.51

$

0.08

$

1.17

$

(0.10)

Diluted

$

0.35

$

0.08

$

0.83

$

(0.10)

Weighted average common shares outstanding:







Basic

1,921

1,891

1,904

1,891

Diluted

2,892

1,891

2,785

1,891

TOR Minerals International, Inc. and Subsidiaries

Consolidated Balance Sheets

(In thousands, except share and per share amounts)







December 31,


2010

2009

ASSETS



CURRENT ASSETS:



Cash and cash equivalents

$

2,559

$

1,002

Trade accounts receivable, net

3,888

3,380

Inventories


11,021

9,101

Other current assets

728

540

Total current assets

18,196

14,023

PROPERTY, PLANT AND EQUIPMENT, net


18,952

18,800

OTHER ASSETS

23

53

Total Assets

$

37,171

$

32,876





LIABILITIES AND SHAREHOLDERS' EQUITY



CURRENT LIABILITIES:



Accounts payable

$

2,544

$

1,452

Accrued expenses

1,436

1,036

Notes payable under lines of credit

783

3,313

Export credit refinancing facility

264

-

Current deferred tax liability

64

60

Current maturities - capital leases

46

140

Current maturities of long-term debt – financial institutions

533

435

Total current liabilities

5,670

6,436

LONG-TERM DEBT, EXCLUDING CURRENT MATURITIES





Capital leases

18

49

Long-term debt – financial institutions

2,847

1,477

Long-term debt – convertible debentures, net

1,176

1,122

DEFERRED TAX LIABILITY

582

577

Total liabilities

10,293

9,661

COMMITMENTS AND CONTINGENCIES





SHAREHOLDERS' EQUITY:





Series A 6% convertible preferred stock $.01 par value:

authorized, 5,000 shares; 200 shares issued and

outstanding at 12/31/2010 and 12/31/2009

2

2

Common stock $.25 par value:  authorized, 6,000 shares;

1,934 and 1,891 shares issued and outstanding at

12/31/2010 and 12/31/2009, respectively

2,416

2,363

Additional paid-in capital

25,363

25,214

Accumulated deficit

(5,579)

(7,807)

Accumulated other comprehensive income:



Cumulative translation adjustment

4,676

3,443

Total shareholders' equity

26,878

23,215

Total Liabilities and Shareholders' Equity

$

37,171

$

32,876

TOR Minerals International, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In thousands)







Year Ended December 31,


2010

2009

CASH FLOWS FROM OPERATING ACTIVITIES:



Net Income (Loss)

$

2,288

$

(136)

Adjustments to reconcile net income (loss) to net cash

provided by operating activities:



Depreciation

1,903

1,812

Loss on disposal of assets

-

35

Share-based compensation

91

266

Warrant interest expense

70

44

Deferred income taxes

10

4

Provision for bad debts

23

(61)

Changes in working capital:



Trade accounts receivables

(545)

(762)

Inventories

(1,449)

2,807

Other current assets

(179)

(91)

Accounts payable and accrued expenses

1,456

(1,428)

Net cash provided by operating activities

3,668

2,490





CASH FLOWS FROM INVESTING ACTIVITIES:



Additions to property, plant and equipment

(1,645)

(922)

Proceeds from sales of property, plant and equipment

18

-

Net cash used in investing activities

(1,627)

(922)





CASH FLOWS FROM FINANCING ACTIVITIES:



Net (payments on) proceeds from lines of credit

(2,449)

1,120

Net proceeds from (payments on) export

credit refinancing facility

264

(1,471)

Proceeds from capital lease

19

69

Payments on capital lease

(137)

(111)

Proceeds from long-term bank debt

2,000

-

Payments on long-term bank debt

(470)

(1,604)

(Payments on) proceeds from convertible debentures

(25)

1,500

Loan origination costs

33

(15)

Proceeds from the issuance of common stock,

    and exercise of common stock options

121

-

Preferred stock dividends paid

(60)

(60)

Net cash (used in) provided by financing activities

(704)

(572)

Effect of exchange rate fluctuations on cash and cash equivalents

220

(185)

Net increase (decrease) in cash and cash equivalents

1,557

811

Cash and cash equivalents at beginning of year

1,002

191

Cash and cash equivalents at end of year

$

2,559

$

1,002





Supplemental cash flow disclosures:



Interest paid

$

439

$

558

Income taxes paid

$

7

$

3

SOURCE TOR Minerals International

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