TOR Minerals International Reports Third Quarter Financial Results
CORPUS CHRISTI, Texas, Oct. 30, 2014 /PRNewswire/ -- TOR Minerals International (Nasdaq: TORM), producer of high performance specialty minerals, today announced its financial results for the third quarter ended September 30, 2014. Highlights for the third quarter of 2014 as compared to the third quarter of 2013 include:
- 3Q14 revenue increased 4 percent to $11.3 million
- 3Q14 net income of $296,000 versus 3Q13 net income of $113,000
- 3Q14 diluted earnings per share of $0.09 versus 3Q13 earnings per share of $0.03
- Book value was $11.48 per share based on our diluted share count at 9/30/14
| Revenue by Product Group (in 000's) |
3Q14 |
3Q13 |
% Change |
|||
| Specialty Aluminas |
$ 5,200 |
$ 4,309 |
21% |
|||
| Barium Sulfate and Other Products |
2,477 |
2,340 |
6% |
|||
| TiO2 Pigments |
3,640 |
4,221 |
-14% |
|||
| Total |
$ 11,317 |
$ 10,870 |
4% |
Net sales increased 4 percent during the third quarter of 2014, as sales growth in the Specialty alumina and Barium Sulfate products was partially offset by a decrease in TiO2 Pigment Sales. Specialty alumina sales, which include ALUPREM®, HALTEX® and OPTILOAD®, increased 21 percent over the prior year quarter, due primarily to strong sales growth of ALUPREM products to new and existing customers in Europe and in the U.S. Barium Sulfate and Other product sales increased six percent, primarily due to increased volumes from new and existing BARTEX® customers in the U.S. and of BARYPREM to customers in Europe. Sales of titanium dioxide (TiO2) pigments products, which include HITOX®, TIOPREM® and synthetic rutile (SR), decreased 14 percent versus the prior year quarter, primarily due to continued weakness in demand and pricing in the global TiO2 industry.
During the third quarter of 2014, gross margin was 13.3 percent of sales, versus 14.5 percent during the same period last year. The decrease in gross margin was primarily related to low levels of plant utilization at the Malaysian SR plant. In addition lower average selling prices and higher overall inventory costs contributed to the year-over-year decrease. Operating expenses decreased 9 percent to $1.1 million, primarily related to a decrease in staffing levels. Third quarter net income was $296,000, or $0.09 per diluted share, as compared to a net income of $113,000, or $0.03 per share, during the same period a year ago.
"Our Specialty Alumina business continues to post double-digit year-over-year growth, up 21 percent for the quarter and 27 percent year to date. Combined with the strength of our Barium Sulfate and other product groups, we were able to more than offset the tough market conditions and lower utilization levels of our TiO2 business, allowing us to post overall revenue growth and maintain profitability," commented Dr. Olaf Karasch, Chief Executive Officer.
"We remain optimistic about the outlook for our specialty alumina business, and continue to expect double-digit revenue and profitability growth for this part of our business. Our TiO2 business is likely to continue to be negatively affected by softer demand trends and weak pricing across the industry," said Dr. Karasch. "Our strategic focus will remain on growing our specialty alumina business and improving efficiency and cost containment across all segments of the business. We believe this strategy should allow us to generate positive cash flow and produce continued improvement in profitability during the ongoing downturn in the TiO2 cycle."
TOR Minerals will host a conference call at 4:00 p.m. Central Time on October 30, 2014, to further discuss Third quarter results. The call will be simultaneously Webcast, and can be accessed via the News section on the Company's website, www.torminerals.com. Investors and interested parties may participate in the call by dialing 877-407-8033 and referring to conference ID # 13592665.
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 slowdown 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.
Investor Relations Contact
Dave Mossberg
Three Part Advisors, LLC
817 310-0051
Jeff Elliott
Three Part Advisors, LLC
972-423-7070
| TOR Minerals International, Inc. and Subsidiaries |
||||||||
| Condensed Consolidated Income Statements |
||||||||
| (Unaudited) |
||||||||
| (In thousands, except per share amounts) |
||||||||
| Three Months |
Nine Months |
|||||||
| 2014 |
2013 |
2014 |
2013 |
|||||
| NET SALES |
$ |
11,317 |
$ |
10,870 |
$ |
36,841 |
$ |
33,029 |
| Cost of sales |
9,809 |
9,289 |
31,674 |
28,242 |
||||
| GROSS MARGIN |
1,508 |
1,581 |
5,167 |
4,787 |
||||
| Technical services and research and development |
50 |
135 |
150 |
459 |
||||
| Selling, general and administrative expenses |
1,092 |
1,119 |
3,319 |
3,644 |
||||
| Loss on disposal of assets |
- |
- |
- |
10 |
||||
| OPERATING INCOME |
366 |
327 |
1,698 |
674 |
||||
| OTHER INCOME (EXPENSE): |
||||||||
| Interest expense, net |
(85) |
(103) |
(275) |
(286) |
||||
| Gain (Loss) on foreign currency exchange rate |
71 |
(84) |
10 |
(151) |
||||
| Other, net |
5 |
6 |
10 |
18 |
||||
| Total Other Expense |
(9) |
(181) |
(255) |
(419) |
||||
| INCOME BEFORE INCOME TAX |
357 |
146 |
1,443 |
255 |
||||
| Income tax expense |
61 |
33 |
287 |
67 |
||||
| NET INCOME |
$ |
296 |
$ |
113 |
$ |
1,156 |
$ |
188 |
| Earnings per common share: |
||||||||
| Basic |
$ |
0.10 |
$ |
0.04 |
$ |
0.38 |
$ |
0.06 |
| Diluted |
$ |
0.09 |
$ |
0.03 |
$ |
0.34 |
$ |
0.06 |
| Weighted average common shares outstanding: |
||||||||
| Basic |
3,014 |
3,012 |
3,014 |
2,999 |
||||
| Diluted |
3,394 |
3,422 |
3,403 |
3,271 |
||||
| TOR Minerals International, Inc. and Subsidiaries |
||||
| Condensed Consolidated Balance Sheets |
||||
| (In thousands, except per share amounts) |
||||
| September 30, |
December 31, |
|||
| (Unaudited) |
||||
| ASSETS |
||||
| CURRENT ASSETS: |
||||
| Cash and cash equivalents |
$ |
2,736 |
$ |
2,920 |
| Trade accounts receivable, net |
5,871 |
4,526 |
||
| Inventories, net |
20,487 |
20,753 |
||
| Other current assets |
965 |
596 |
||
| Total current assets |
30,059 |
28,795 |
||
| PROPERTY, PLANT AND EQUIPMENT, net |
21,957 |
23,799 |
||
| OTHER ASSETS |
23 |
23 |
||
| Total Assets |
$ |
52,039 |
$ |
52,617 |
| LIABILITIES AND SHAREHOLDERS' EQUITY |
||||
| CURRENT LIABILITIES: |
||||
| Accounts payable |
$ |
4,914 |
$ |
3,279 |
| Accrued expenses |
1,848 |
1,397 |
||
| Notes payable under lines of credit |
425 |
1,477 |
||
| Export credit refinancing facility |
2,330 |
3,866 |
||
| Current deferred tax liability |
17 |
66 |
||
| Current maturities - capital leases |
- |
12 |
||
| Current maturities of long-term debt – financial institutions |
1,159 |
1,040 |
||
| Total current liabilities |
10,693 |
11,137 |
||
| LONG-TERM DEBT - FINANCIAL INSTITUTIONS |
2,008 |
2,918 |
||
| DEFERRED TAX LIABILITY |
257 |
18 |
||
| Total liabilities |
12,958 |
14,073 |
||
| COMMITMENTS AND CONTINGENCIES |
||||
| SHAREHOLDERS' EQUITY: |
||||
| Common stock $1.25 par value: authorized, 6,000 shares; |
3,767 |
3,765 |
||
| Additional paid-in capital |
29,473 |
29,365 |
||
| Retained earnings |
2,809 |
1,653 |
||
| Accumulated other comprehensive income: |
||||
| Cumulative translation adjustment |
3,032 |
3,761 |
||
| Total shareholders' equity |
39,081 |
38,544 |
||
| Total Liabilities and Shareholders' Equity |
$ |
52,039 |
$ |
52,617 |
| TOR Minerals International, Inc. and Subsidiaries |
||||
| Condensed Consolidated Statements of Cash Flows |
||||
| (Unaudited) |
||||
| (In thousands) |
||||
| Nine Months Ended September 30, |
||||
| 2014 |
2013 |
|||
| CASH FLOWS FROM OPERATING ACTIVITIES: |
||||
| Net Income |
$ |
1,156 |
$ |
188 |
| Adjustments to reconcile net income to net cash |
||||
| Depreciation |
2,570 |
2,355 |
||
| Loss on disposal of assets |
- |
10 |
||
| Stock-based compensation |
100 |
85 |
||
| Deferred income tax expense (benefit) |
189 |
(123) |
||
| Change in inventory reserve |
(174) |
(15) |
||
| Provision for bad debts |
(7) |
3 |
||
| Changes in working capital: |
||||
| Trade accounts receivables |
(1,411) |
(903) |
||
| Inventories |
343 |
(4,996) |
||
| Other current assets |
(381) |
814 |
||
| Accounts payable and accrued expenses |
2,223 |
1,135 |
||
| Net cash provided by (used in) operating activities |
4,608 |
(1,447) |
||
| CASH FLOWS FROM INVESTING ACTIVITIES: |
||||
| Additions to property, plant and equipment |
(1,386) |
(3,529) |
||
| Proceeds from sales of property, plant and equipment |
- |
2 |
||
| Net cash used in investing activities |
(1,386) |
(3,527) |
||
| CASH FLOWS FROM FINANCING ACTIVITIES: |
||||
| Net (payments on) proceeds from lines of credit |
(965) |
804 |
||
| Net (payments on) proceeds from export credit refinancing facility |
(1,532) |
3,600 |
||
| Payments on capital leases |
(11) |
(30) |
||
| Proceeds from long-term bank debt |
236 |
276 |
||
| Payments on long-term bank debt |
(947) |
(815) |
||
| Proceeds from the issuance of common stock and exercise of common stock options |
11 |
267 |
||
| Net cash (used in) provided by financing activities |
(3,208) |
4,102 |
||
| Effect of foreign currency exchange rate fluctuations on cash and cash equivalents |
(198) |
(128) |
||
| Net decrease in cash and cash equivalents |
(184) |
(1,000) |
||
| Cash and cash equivalents at beginning of period |
2,920 |
2,799 |
||
| Cash and cash equivalents at end of period |
$ |
2,736 |
$ |
1,799 |
| Supplemental cash flow disclosures: |
||||
| Interest paid |
$ |
275 |
$ |
286 |
| Income taxes paid |
$ |
78 |
$ |
214 |
SOURCE TOR Minerals International
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