10.5.2006: Meldung: CECO Environmental Reports Q1 Results
Chairman and CEO, Phillip DeZwirek, stated, "Our first quarter of 2006 is off to a strong start. This quarter typically starts out slowly as activities start up on new contracts but this year, due to our large backlog at the end of 2005 and the continuing strong economy, our first quarter 2006 performance was noteworthy.
President and Chief Operating Officer, Richard Blum, commented "With significant bookings in January, February and March of 2006, our backlog now stands at $40.5 million as compared to $22.7 million as of March 31, 2005 and our momentum continues into the new year."
Consolidated net sales for the first quarter were $24.4 million, an increase of $9.3 million or 62% compared to the same quarter in 2005. Slightly increased sales from our component parts and duct products coupled with significant increases in construction revenues and equipment revenues accounted for the increase in sales.
First quarter 2006 gross profit was $4.1 million (17.0%) compared to gross profit of $2.2 million (14.4%) during the same period in 2005. This increase was due to higher margins on construction and equipment contracts.
Operating profit generated during the first quarter of FY2006 was $696,000 compared to an operating loss of $960,000 during the comparable period in FY2005. This represents a $1.7 million increase for the quarter.
CECO reported a pretax loss during the first quarter of 2006 of $955,000 compared to a pretax loss of $1.5 million for the same period in FY2005. The pretax loss in 2006 was negatively impacted by a non-cash charge, included in other expense, for the fair market value adjustment of detachable stock warrants which amounted to $1.1 million. It is important to note that net income before tax and this non-cash charge was $145,000 in the first quarter of 2006 compared to a net loss before tax of $1.5 million during the same period in 2005. When the warrants are exercised or expire in 2006, the company will receive a capital contribution and the previously recorded charges will revert to income.
Federal and state income tax benefit was $219,000 during the first quarter of 2006 as compared to a benefit of $875,000 during the first quarter of 2005. The estimated federal and state effective income tax rate in the first quarter of 2006 was 23%, compared to 58% in 2005. Our statutory income tax rate is affected by certain permanent differences including expenses for market valuation of warrants and non-deductible interest expense.
Due to the combination of non-cash charges and the lower 2006 tax rate which created less tax benefit, the net loss for the quarter ended March 31, 2006 was $736,000 compared with a net loss of $632,000 for the same period in 2005. However, as previously stated, most of the non-cash charges will be reversed and become income in the current quarter.
ABOUT CECO ENVIRONMENTAL
CECO Environmental Corp. is North America"s largest independent air pollution control company. Through its seven subsidiaries -- Busch, CECOaire, CECO Filters, CECO Abatement Systems, kbd/Technic, Kirk & Blum and H. M. White, Inc. +- CECO provides a wide spectrum of air quality services and products including: industrial air filters, environmental maintenance, monitoring and management services, and air quality improvements systems. CECO is a full-service provider to the steel, military, aluminum, automotive, ethanol, aerospace, semiconductor, chemical, cement, metalworking, glass, foundry and virtually all-industrial process industries.
For more information on CECO Environmental please visit the company"s website at http://www.cecoenviro.com/
Phillip DeZwirek, CECO Environmental Corp.
Consolidated Statement of Operations
(In thousands, except share and per share data)
Three months ended
Net sales $24,382 $15,055
Cost of sales 20,249 12,882
Gross Profit 4,133 2,173
Selling & Administrative 3,145 2,841
Depreciation & amortization 292 292
Operating income (loss) 696 (960)
Other (expense) income (1,080) 50
Interest expense (571) (597)
Loss before tax (955) (1,507)
Income tax benefit (219) (875)
Net (loss) $(736) $(632)
Per share data
Net loss per basic share $(0.07) $(0.06)
Weighted average shares outstanding
Basic and diluted 10,913,503 9,993,260
Source: CECO Environmental Corp.