SOURCE: Perma-Fix Environmental Services, Inc.

Perma-Fix Environmental Services, Inc.

November 08, 2012 08:00 ET

Perma-Fix Reports Financial Results for the Third Quarter of 2012

ATLANTA, GA--(Marketwire - Nov 8, 2012) - Perma-Fix Environmental Services, Inc. (NASDAQ: PESI) today announced results for the third quarter and nine months ended September 30, 2012.

Dr. Louis F. Centofanti, Chairman and Chief Executive Officer, stated, "We continue to feel the effects of delayed government spending in both our Treatment and Services Segments. During the third quarter and heading into the fourth quarter of 2012, we have seen a sequential improvement in our Treatment Segment sales, which is reflected in improvements in both revenue and backlog which were up approximately 13.6% and 59.6% respectively, compared to our second quarter of 2012. Within our Services Segment, we are winning smaller contracts; however, the larger contracts we are bidding on continue to be delayed. In the meantime, we remain focused on generating positive cash flow, reducing debt, controlling our costs and growing our revenue."

Financial Results

Revenue for the third quarter of 2012 was $29.1 million versus $32.8 million for the same period last year. Revenue for the Treatment Segment declined to $11.4 million from $20.2 million for the same period in 2011. Revenue from the Services Segment increased to $17.7 million from $12.6 million for the same period in 2011. Revenue generated from the acquisition of Safety and Ecology Holdings Corporation and its subsidiaries ("SEC") totaled $11.3 million offset by a decrease in revenue from the Department of Energy ("DOE") Hanford Site of approximately $6.1 million. Gross profit for the third quarter of 2012 was $4.4 million versus $11.3 million for the third quarter of 2011. Gross margin decreased to 15.2% from 34.5% for the same period last year primarily due to lower revenue and the impact of fixed costs on our cost of goods sold. Operating loss for the third quarter of 2012 was $(284,000) versus an income of $6.9 million for the third quarter of 2011. Net loss attributable to common stockholders for the third quarter of 2012 was $(425,000), or $(0.01) per share, versus net income of $6.0 million or $0.11 per share, for the same period in 2011. Net income for the third quarter of 2011 included a gain on disposal of discontinued operations of $1.8 million or $0.03 per share. The Company generated Adjusted EBITDA of $1.3 million from continuing operations during the quarter ended September 30, 2012, as compared to Adjusted EBITDA of approximately $8.1 million for the same period of 2011.

The Company defines EBITDA as earnings before interest, taxes, depreciation and amortization. EBITDA and Adjusted EBITDA are not measures of performance calculated in accordance with Generally Accepted Accounting Principles in the United States ("GAAP"), and should not be considered in isolation of, or as a substitute for, earnings as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. The Company believes the presentation of EBITDA is relevant and useful by enhancing the readers' ability to understand the Company's operating performance. The Company's management utilizes EBITDA as a means to measure performance. The Company's measurement of EBITDA may not be comparable to similarly titled measures reported by other companies. Due to the unique accounting for the recognition of fair market value of percentage of completion contracts resulting from the acquisition of SEC, the Company recognizes that EBITDA is an "Adjusted EBITDA" and understands these differences when measuring performance. The table below reconciles EBITDA and Adjusted EBITDA, both non-GAAP measures, to (loss) income from continuing operations for the three and nine months ended September 30, 2012 and 2011.

             
             
    Quarter Ended     Nine Months Ended  
    September 30,     September 30,  
(In thousands)   2012     2011     2012     2011  
Net (loss) income from continuing operations   $ (343 )   $ 4,421     $ (2,329 )   $ 6,440  
                                 
                                 
Adjustments:                                
  Depreciation & amortization     1,079       1,171       4,522       3,503  
  Interest income     (10 )     (14 )     (31 )     (40 )
  Interest expense     223       99       642       458  
  Interest expense - financing fees     23       22       84       178  
  Income tax (benefit) expense     (168 )     2,399       (1,126 )     3,504  
                                 
EBITDA     804       8,098       1,762       14,043  
                                 
  Fair value of percentage of completioncontract resulting from acquisition    
521
     
-
     
1,249
     
-
 
                                 
Adjusted EBITDA   $ 1,325     $ 8,098     $ 3,011     $ 14,043  
                                 
                                 

The tables below present certain financial information for the business segments, excluding allocation of corporate expenses:

         
         
    Three Months Ended   Nine Months Ended
    September 30, 2012   September 30, 2012
(In thousands)   Treatment   Services   Treatment   Services
Net revenues   $ 11,405   $ 17,723   $ 34,284   $ 66,896
Gross profit     3,097     1,337     6,904     5,556
Segment profit     1,351     83     2,515     1,008
         
    Three Months Ended   Nine Months Ended
    September 30, 2011   September 30, 2011
(In thousands)   Treatment   Services   Treatment   Services
Net revenues   $ 20,150   $ 12,637   $ 50,116   $ 35,199
Gross profit     8,979     2,322     15,911     6,469
Segment profit     5,270     1,204     8,649     3,509
                         
                         

Conference Call

Perma-Fix will host a conference call at 12:00 noon ET on Thursday, November 8, 2012. The call will be available on the Company's website at www.perma-fix.com, or by calling (877) 407-0778 for U.S. callers, or (201) 689-8565 for international callers. A webcast will also be archived on the Company's website and a telephone replay of the call will be available approximately one hour following the call, through midnight on Thursday, November 15, 2012, and can be accessed by calling: (877) 660-6853 (U.S. callers) or (201) 612-7415 (international callers) and entering conference ID: 403398.

About Perma-Fix Environmental Services

Perma-Fix Environmental Services, Inc. is a nuclear services company and leading provider of nuclear and mixed waste management services. The Company's nuclear waste services include management and treatment of radioactive and mixed waste for hospitals, research labs and institutions, federal agencies, including the DOE, the Department of Defense ("DOD"), and the commercial nuclear industry. The Company's nuclear services group provides project management, waste management, environmental restoration, decontamination and decommissioning, new build construction, and radiological protection, safety and industrial hygiene capability to our clients. The Company operates four nuclear waste treatment facilities and provides nuclear services at DOE, DOD, and commercial facilities, nationwide. Please visit us on the World Wide Web at http://www.perma-fix.com.

This press release contains "forward-looking statements" which are based largely on the Company's expectations and are subject to various business risks and uncertainties, certain of which are beyond the Company's control. Forward-looking statements generally are identifiable by use of the words such as "believe," "expects," "intends," "anticipate," "plans to," "estimates," "projects," and similar expressions. Forward-looking statements include, but are not limited to: remain focused on generating positive cash flow, reducing debt, controlling our costs and growing our revenue. These forward-looking statements are intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. While the Company believes the expectations reflected in this news release are reasonable, it can give no assurance such expectations will prove to be correct. There are a variety of factors which could cause future outcomes to differ materially from those described in this release, including, without limitation, future economic conditions; industry conditions; competitive pressures; our ability to apply and market our technologies; the government or such other party to a contract granted to us fails to abide by or comply with the contract or to deliver waste as anticipated under the contract; that Congress provides continuing funding for the Department of Defense's and Department of Energy's remediation projects; our ability to obtain new contracts on favorable terms; our ability to perform under contracts that we have and/or will be receiving; material contracts with the federal government, or subcontracts relating to federal sites, are terminated or renegotiated by the federal government; and the additional factors referred to under "Special Note Regarding Forward-Looking Statements" of our 2011 Form 10-K. The Company makes no commitment to disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that bear upon forward-looking statements.

Please visit us on the World Wide Web at http://www.perma-fix.com.

 
 
FINANCIAL TABLES FOLLOW
 
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
    Three Months Ended     Nine Months Ended  
    September 30,     September 30,  
(Amounts in Thousands, Except for Per Share Amounts)   2012     2011     2012     2011  
                                 
Net revenues   $ 29,128     $ 32,787     $ 101,180     $ 85,315  
Cost of goods sold     24,694       21,486       88,720       62,935  
  Gross profit     4,434       11,301       12,460       22,380  
                                 
Selling, general and administrative expenses     4,198       4,022       13,825       10,829  
Research and development     502       357       1,390       1,019  
Loss on disposal of property and equipment     18       -       15       -  
  (Loss) income from operations     (284 )     6,922       (2,770 )     10,532  
                                 
Other income (expense):                                
Interest income     10       14       31       40  
Interest expense     (223 )     (99 )     (642 )     (458 )
Interest expense-financing fees     (23 )     (22 )     (84 )     (178 )
Other     9       5       10       8  
(Loss) income from continuing operations before taxes     (511 )     6,820       (3,455 )     9,944  
Income tax (benefit) expense     (168 )     2,399       (1,126 )     3,504  
(Loss) income from continuing operations, net of taxes     (343 )     4,421       (2,329 )     6,440  
                                 
Loss from discontinued operations, net of taxes     (61 )     (187 )     (258 )     (7 )
Gain on disposal of discontinued operations, net of taxes     -       1,777       -       1,777  
  Net (loss) income     (404 )     6,011       (2,587 )     8,210  
                                 
Less: net income attributable to non-controlling interest     21       -       179       -  
                                 
Net (loss) income attributable to Perma-Fix Environmental                                
  Services, Inc. common stockholders   $ (425 )   $ 6,011     $ (2,766 )   $ 8,210  
                                 
Net (loss) income per common share attributable to                                
  Perma-Fix Environmental Services, Inc. stockholders - basic:                                
Continuing operations   $ (.01 )   $ .08     $ (.04 )   $ .12  
Discontinued operations   $ -     $ -     $ (.01 )   $ -  
Disposal of discontinued operations   $ -     $ .03     $ -     $ .03  
  Net (loss) income per common share   $ (.01 )   $ .11     $ (.05 )   $ .15  
                                 
Net (loss) income per common share attributable to                                
  Perma-Fix Environmental Services, Inc. stockholders - diluted:                                
Continuing operations   $ (.01 )   $ .08     $ (.04 )   $ .12  
Discontinued operations   $ -     $ -     $ (.01 )   $ -  
Disposal of discontinued operations   $ -     $ .03     $ -     $ .03  
  Net (loss) income per common share   $ (.01 )   $ .11     $ (.05 )   $ .15  
                                 
Number of common shares used in computingnet (loss) income per share:                                
Basic     56,140       55,174       56,099       55,137  
Diluted     56,140       55,174       56,099       55,142  
                                 
                                 
   
PERMA-FIX ENVIRONMENTAL SERVICES, INC.  
CONDENSED CONSOLIDATED BALANCE SHEET  
(Unaudited)  
   
 
(Amounts in Thousands, Except for Share and Per Share Amounts)
 
 
September 30,
2012
 
 
 
 
December 31,
2011
 
 
                 
ASSETS                
Current assets:                
  Cash   $ 2,753     $ 12,055  
  Restricted cash     35       1,535  
  Account receivable, net of allowance for doubtful accounts of $803 and $228     14,981       19,106  
  Unbilled receivables     8,694       9,871  
  Other current assets     6,920       6,589  
  Deferred tax assets - current     2,187       2,426  
  Assets of discontinued operations included in current assets, net of allowance for doubtful accounts of $47 and $48     526       693  
    Total current assets     36,096       52,275  
                 
Net property and equipment     36,487       39,835  
Property and equipment of discontinued operations, net of accumulated depreciation of $60 and $62     1,614       1,650  
Deferred tax asset, net of liabilities     1,211       1,295  
Intangibles and other assets     73,100       69,548  
    Total assets   $ 148,508     $ 164,603  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY                
Current liabilities     27,781       37,999  
Current liabilities related to discontinued operations     1,718       2,197  
    Total current liabilities     29,499       40,196  
                 
Long-term liabilities     24,793       28,084  
Long-term liabilities related to discontinued operations     1,953       1,775  
    Total liabilities     56,245       70,055  
Commitments and Contingencies                
Preferred Stock of subsidiary, $1.00 par value; 1,467,396 shares authorized, 1,284,730 shares issued and outstanding, liquidation value $1.00 per share plus accrued and unpaid dividends     1,285       1,285  
Stockholders' equity:                
  Preferred Stock, $.001 par value; 2,000,000 shares authorized, no shares issued and outstanding     -       -  
  Common Stock, $.001 par value; 75,000,000 shares authorized, 56,186,121 and 56,068,248 shares issued, respectively; 56,147,911 and 56,030,038 outstanding, respectively     56       56  
  Additional paid-in capital     102,710       102,411  
  Accumulated deficit     (12,271 )     (9,505 )
  Accumulated other comprehensive income     -       (3 )
  Less Common Stock in treasury, at cost: 38,210 shares     (88 )     (88 )
    Total Perma-Fix Environmental Services, Inc. stockholders' equity     90,407       92,871  
  Non-controlling interest     571       392  
      Total stockholders' equity     90,978       93,263  
                 
    Total liabilities and stockholders' equity   $ 148,508     $ 164,603  
                 
                 

Contact Information

  • Contacts:
    David K. Waldman
    US Investor Relations
    Crescendo Communications, LLC
    (212) 671-1021

    Herbert Strauss
    European Investor Relations
    Email Contact
    +43 316 296 316