EX-99.1 2 d435465dex991.htm PRESS RELEASE Press Release

Exhibit 99.1







Company Achieves Quarterly Earnings Per Share of $0.19

CINCINNATI, OHIO, November 07th, 2012—CECO Environmental Corp. (NasdaqGM:CECE), a leading provider of air pollution control technology and systems, today announced third quarter and nine-month results for the period ended September 30, 2012.

Financial highlights for the third quarter of 2012 compared to the third quarter of 2011 include:

Net sales were $33.1 million compared to $32.9 million in the comparable quarter, an increase of 0.5%;

Gross profit increased by 8.6% to $10.5 million from $9.7 million;

Gross margin increased to 31.8% from 29.4%;

Operating income increased by 28.4% to $4.3 million from $3.3 million in 2011;

Operating margin increased to 12.8% from 10.0% in 2011;

Net income increased by 40.9% to $3.3 million compared to $2.3 million;

Net income per diluted share was $0.19 compared to $0.14 in 2011;

SG&A expenses remain fairly consistent as a percent of sales at 18.7% compared to 19.0%;

Bookings increased by 17.4% to $41.8 million compared to $35.6 million in 2011;

Cash and cash equivalents remain strong at $24.5 million compared to $12.7 million as of December 31, 2011; and

Backlog as of September 30, 2012 was $67.6 million compared to $54.9 million as of December 31, 2011 and $55.3 million as of September 30, 2011.

Q3 2012 includes a $0.5 million net benefit from the US R&D tax credit for Fiscal Year 2011 relating to our innovative product technologies.

Financial highlights for the nine months ended September 30, 2012 compared to nine months ended September 30, 2011 include:

Net sales were $100.7 million compared to $101.4 million for the comparable period in 2011, a decrease of 0.7%;

Gross profit increased by 16.3% to $31.3 million from $26.9 million;

Gross margin increased to 31.0% from 26.5%;

Operating income increased 43.3% to $12.3 million from $8.6 million in 2011;

Operating margin increased to 12.2% from 8.4% in 2011;

Net income increased 41.0% to $7.8 million compared to net income of $5.5 million;

Net income per diluted share was $0.47 compared to $0.34 in the previous year;

SG&A expenses as a percent of sales increased slightly to 18.6% from 17.8%; and

Year-to-date bookings increased by 10.7% to $113.4 million compared to $102.4 million in 2011.

“We are very pleased with the results that CECO achieved in the third quarter and year to date as the Company continued to realize improving margins, greater profitability and increasing bookings,” commented CECO’s Chief Executive Officer, Jeff Lang. “The Company’s significant booking momentum from our North America and international customers coupled with our management team’s focus on cost containment and margin improvement contributed to CECO’s substantial growth in operating cash flow and continued operational excellence. We are ideally positioned for future organic and inorganic growth opportunities during the rest of 2012 and into 2013.

CECO will host a conference call on Wednesday, November 7, 2012 at 8:30 a.m. EDT to review its financial results for the quarter. Conferencing details are as follows:


Dial in number:   866-356-4441
International dial in number:   617-597-5396
Participant passcode:   80596185
Replay:   888-286-8010
International:   617-801-6888
Passcode:   97031195

This call is being webcast by Thomson/CCBN and can be accessed at CECO’s web site at www.cecoenviro.com.

The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at www.earnings.com, Thomson’s individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents (www.streetevents.com), a password-protected event management site.


CECO Environmental is a global leader providing air pollutions control technology. Through its subsidiaries – Busch International, CECO Filters, CECO Abatement Systems, Kirk & Blum, Effox-Flextor, Fisher-Klosterman/Buell, CECO China and A.V.C. Specialists – CECO provides a wide spectrum of air quality products and services including engineered equipment, cyclones, scrubbers, dampers, diverters, RTO’s, component parts and monitoring and management services. Industries served include refining, petro-chemical, power, aluminum, steel, automotive, chemical and large industrial processes. Revenue from engineered equipment technology is approximately 75% and 25% from parts, services and aftermarket. Global Growth, Operational Excellence, Margin Expansion, Safety, and Employee Development are CECO’s core competencies and long term objectives.

For more information on CECO Environmental please visit the company’s website at http://www.cecoenviro.com.


Corporate Information

Jeff Lang, CECO Environmental Corp.





Dollars in thousands, except per share data


     2012     2011     2012     2011  

Net sales

   $ 33,102      $ 32,947      $ 100,720      $ 101,440   

Cost of sales

     22,574        23,249        69,461        74,571   













Gross profit

     10,528        9,698        31,259        26,869   

Selling and administrative

     6,197        6,270        18,724        17,958   


     80        118        252        341   













Income from operations

     4,251        3,310        12,283        8,570   

Other (expenses) income, net

     (69     103        (133     436   

Interest expense (including related party interest of $60 and $59, and $178 and $177, respectively)

     (291     (296     (828     (870













Income from operations before income taxes

     3,891        3,117        11,322        8,136   

Income tax expense

     623        798        3,524        2,606   













Net income

   $ 3,268      $ 2,319      $ 7,798      $ 5,530   













Per share data:


Basic net income

   $ 0.22      $ 0.16      $ 0.53      $ 0.39   













Diluted net income

   $ 0.19      $ 0.14      $ 0.47      $ 0.34   













Weighted average number of common shares outstanding:



     14,630,264        14,371,752        14,591,325        14,340,119   














     17,258,552        17,157,305        17,199,337        17,130,767   
















Dollars in thousands, except per share data


     SEPTEMBER 30, 
    DECEMBER 31, 

Current assets:


Cash and cash equivalents

   $ 24,455      $ 12,724   

Accounts receivable, net

     21,281        23,109   

Costs and estimated earnings in excess of billings on uncompleted contracts

     7,057        10,643   

Inventories, net

     4,292        4,344   

Prepaid expenses and other current assets

     2,399        2,650   







Total current assets

     59,484        53,470   

Property and equipment, net

     5,128        5,651   


     14,777        14,661   

Intangibles – finite life, net

     274        526   

Intangibles – indefinite life

     3,230        3,218   

Deferred income tax asset, net

     848        848   

Deferred charges and other assets

     714        971   






   $ 84,455      $ 79,345   







Current liabilities:


Accounts payable and accrued expenses

   $ 12,101      $ 13,569   

Billings in excess of costs and estimated earnings on uncompleted contracts

     8,501        9,647   

Income taxes payable

     1,531        393   







Total current liabilities

     22,133        23,609   

Other liabilities

     3,197        3,146   

Convertible subordinated notes (including related parties notes of $3,950 in 2012 and 2011)

     8,760        9,600   







Total liabilities

     34,090        36,355   







Shareholders’ equity:


Preferred stock, $.01 par value; 10,000 shares authorized, none issued

     —          —     

Common stock, $0.01 par value; 100,000,000 shares authorized, 14,849,502 and 14,654,262 shares issued in 2012 and 2011

     148        146   

Capital in excess of par value

     45,393        44,249   

Accumulated earnings

     7,410        1,301   

Accumulated other comprehensive loss

     (2,230     (2,350 )






     50,721        43,346   

Less treasury stock, at cost, 137,920 shares in 2012 and 2011

     (356     (356 )







Total shareholders’ equity

     50,365        42,990   






   $ 84,455      $ 79,345   







This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to certain risks, uncertainties and assumptions. These risks and uncertainties, which are more fully described in CECO’s Annual and Quarterly Reports filed with the Securities and Exchange Commission, and

include, but are not limited to: our dependence on fixed price contracts and the risks associated therewith, including actual costs exceeding our estimates and our method of accounting for contract revenue; our history of losses and possibility of further losses; fluctuations in operating results from period to period due to seasonality of our business; the effect of growth on our infrastructure, resources, and existing sales; our ability to expand our operations in both new and existing markets; the potential for contract delay or cancellation; the potential for fluctuations in prices for manufactured components and raw materials; the impact of federal, state or local government regulations; economic and political conditions generally; and the effect of competition in the air pollution control and industrial ventilation industry. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may vary in material aspects from those currently anticipated. We caution investors that other factors might, in the future, prove to be important in affecting our results of operations. New factors emerge from time to time and it is not possible for management to predict all such factors, nor can it assess the impact of each such factor on the business or the extent to which any factor, or a combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Investors are further cautioned not to place undue reliance on such forward-looking statements as they speak only to our views as of the date the statement is made. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events or otherwise.