Delaware (State or other jurisdiction of incorporation) | 001-33059 (Commission File Number) | 20-5657551 (IRS Employer Identification No.) |
CONTACT: | Jim Pach | Devin Sullivan |
Principal Financial Officer | Senior Vice President | |
(630) 845-4500 | The Equity Group Inc. | |
(212) 836-9608 |
• | Revenues rose 50.6% to $12.8 million from $8.5 million |
• | SG&A declined to $4.9 million from $5.2 million |
• | Operating loss from continuing operations narrowed to $184,000 from a loss of $1.8 million |
• | Net loss from continuing operations of $191,000, or $0.01 per diluted share, compared to a net loss from continuing operations of $1.8 million, or $0.08 per diluted share |
• | EBITDA of $31,000 compared to an EBITDA loss of $1.9 million |
• | At March 31, 2018: |
• | capital projects backlog was $19.7 million |
• | total cash and equivalents (including restricted cash) of $12.2 million, or $0.50 per diluted share |
• | no long-term debt |
• | (877) 423-9820 (Domestic) or |
• | (201) 493-6749 (International) |
March 31, 2018 | December 31, 2017 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 5,667 | $ | 8,366 | |||
Restricted cash | 1,520 | 1,020 | |||||
Marketable securities | 4 | 6 | |||||
Accounts receivable, net of allowance for doubtful accounts of $1,531 and $1,545, respectively | 20,164 | 19,690 | |||||
Inventories, net | 1,026 | 945 | |||||
Prepaid expenses and other current assets | 3,548 | 3,592 | |||||
Income taxes receivable | 128 | 129 | |||||
Total current assets | 32,057 | 33,748 | |||||
Property and equipment, net of accumulated depreciation of $26,159 and $25,938, respectively | 6,111 | 6,272 | |||||
Goodwill | 2,116 | 2,116 | |||||
Other intangible assets, net of accumulated amortization of $1,993 and $1,939, respectively | 1,640 | 1,671 | |||||
Restricted cash | 5,000 | 5,000 | |||||
Assets held for sale | 485 | 485 | |||||
Other assets | 1,221 | 1,192 | |||||
Total assets | $ | 48,630 | $ | 50,484 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | 9,430 | 9,065 | |||||
Accrued liabilities: | |||||||
Employee compensation | 1,518 | 1,487 | |||||
Income taxes payable | 52 | 73 | |||||
Other accrued liabilities | 2,554 | 5,098 | |||||
Total current liabilities | 13,554 | 15,723 | |||||
Other liabilities | 400 | 420 | |||||
Total liabilities | 13,954 | 16,143 | |||||
COMMITMENTS AND CONTINGENCIES (Note 12) | |||||||
Shareholders’ equity: | |||||||
Common stock, $.01 par value, 40,000,000 shares authorized, 24,821,446 and 24,777,001 shares issued, and 24,167,679, and 24,132,910 shares outstanding, respectively | 248 | 248 | |||||
Additional paid-in capital | 138,701 | 138,760 | |||||
Accumulated deficit | (102,514 | ) | (102,503 | ) | |||
Accumulated other comprehensive loss | (353 | ) | (768 | ) | |||
Nil coupon perpetual loan notes | 76 | 76 | |||||
Treasury stock, at cost | (1,482 | ) | (1,472 | ) | |||
Total shareholders’ equity | 34,676 | 34,341 | |||||
Total liabilities and shareholders’ equity | $ | 48,630 | $ | 50,484 |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
Revenues | $ | 12,791 | $ | 8,491 | |||
Costs and expenses: | |||||||
Cost of sales | 7,766 | 4,769 | |||||
Selling, general and administrative | 4,921 | 5,154 | |||||
Restructuring charge | — | 61 | |||||
Research and development | 288 | 284 | |||||
12,975 | 10,268 | ||||||
Operating loss from continuing operations | (184 | ) | (1,777 | ) | |||
Interest income | 2 | 3 | |||||
Other expense | (8 | ) | (2 | ) | |||
Loss from continuing operations before income taxes | (190 | ) | (1,776 | ) | |||
Income tax expense | (1 | ) | — | ||||
Net loss from continuing operations | (191 | ) | (1,776 | ) | |||
Loss from discontinued operations (net of income tax benefit of $0 in 2018 and 2017) | (25 | ) | (730 | ) | |||
Net loss | $ | (216 | ) | $ | (2,506 | ) | |
Net loss per common share: | |||||||
Basic | |||||||
Continuing operations | $ | (0.01 | ) | $ | (0.08 | ) | |
Discontinued operations | $ | — | $ | (0.03 | ) | ||
Basic net loss per common share | $ | (0.01 | ) | $ | (0.11 | ) | |
Diluted | |||||||
Continuing operations | $ | (0.01 | ) | $ | (0.08 | ) | |
Discontinued operations | $ | — | $ | (0.03 | ) | ||
Diluted net loss per common share | $ | (0.01 | ) | $ | (0.11 | ) | |
Weighted-average number of common shares outstanding: | |||||||
Basic | 24,146,000 | 23,472,000 | |||||
Diluted | 24,146,000 | 23,472,000 |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
Net loss | $ | (216 | ) | $ | (2,506 | ) | |
Other comprehensive income: | |||||||
Foreign currency translation adjustments | 416 | 116 | |||||
Unrealized gains (losses) from marketable securities, net of tax | (1 | ) | 1 | ||||
Total other comprehensive income | 415 | 117 | |||||
Comprehensive income (loss) | $ | 199 | $ | (2,389 | ) |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
Operating Activities | |||||||
Net loss | $ | (216 | ) | $ | (2,506 | ) | |
Loss from discontinued operations | 25 | 730 | |||||
Net loss from continuing operations | (191 | ) | (1,776 | ) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation | 195 | 405 | |||||
Amortization | 53 | 54 | |||||
Loss on disposal of equipment | 15 | 10 | |||||
Provision for doubtful accounts, net of recoveries | (62 | ) | — | ||||
Stock-based compensation, net of forfeitures | (59 | ) | (10 | ) | |||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 32 | 3,525 | |||||
Inventories | (68 | ) | (26 | ) | |||
Prepaid expenses, other current assets and other non-current assets | 113 | 108 | |||||
Accounts payable | 186 | (1,848 | ) | ||||
Accrued liabilities and other non-current liabilities | (2,750 | ) | (1,483 | ) | |||
Net cash used in operating activities - continuing operations | (2,536 | ) | (1,041 | ) | |||
Net cash used in operating activities - discontinued operations | (25 | ) | (579 | ) | |||
Net cash used in operating activities | (2,561 | ) | (1,620 | ) | |||
Investing Activities | |||||||
Purchases of equipment and patents | (62 | ) | (97 | ) | |||
Proceeds from the sale of equipment | 2 | — | |||||
Net cash used in investing activities | (60 | ) | (97 | ) | |||
Financing Activities | |||||||
Taxes paid on behalf of equity award participants | (11 | ) | (23 | ) | |||
Net cash used in financing activities | (11 | ) | (23 | ) | |||
Effect of exchange rate fluctuations on cash | 433 | 117 | |||||
Net decrease in cash, cash equivalents and restricted cash | (2,199 | ) | (1,623 | ) | |||
Cash, cash equivalents, and restricted cash at beginning of period | 14,386 | 17,846 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 12,187 | $ | 16,223 |
Three months ended March 31, 2018 | Air Pollution Control Segment | FUEL CHEM Segment | Other | Total | |||||||||||
Revenues from external customers | $ | 8,583 | $ | 4,208 | $ | — | $ | 12,791 | |||||||
Cost of sales | (5,597 | ) | (2,169 | ) | — | (7,766 | ) | ||||||||
Gross margin | 2,986 | 2,039 | — | 5,025 | |||||||||||
Selling, general and administrative | — | — | (4,921 | ) | (4,921 | ) | |||||||||
Research and development | — | — | (288 | ) | (288 | ) | |||||||||
Operating income (loss) from continuing operations | $ | 2,986 | $ | 2,039 | $ | (5,209 | ) | $ | (184 | ) |
Three months ended March 31, 2017 | Air Pollution Control Segment | FUEL CHEM Segment | Other | Total | |||||||||||
Revenues from external customers | $ | 4,002 | $ | 4,489 | $ | — | $ | 8,491 | |||||||
Cost of sales | (2,500 | ) | (2,269 | ) | — | (4,769 | ) | ||||||||
Gross margin | 1,502 | 2,220 | — | 3,722 | |||||||||||
Selling, general and administrative | — | — | (5,154 | ) | (5,154 | ) | |||||||||
Restructuring charge | — | (61 | ) | — | (61 | ) | |||||||||
Research and development | — | — | (284 | ) | (284 | ) | |||||||||
Operating income (loss) from continuing operations | $ | 1,502 | $ | 2,159 | $ | (5,438 | ) | $ | (1,777 | ) |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
Revenues: | |||||||
United States | $ | 10,242 | $ | 6,734 | |||
Foreign | 2,549 | 1,757 | |||||
$ | 12,791 | $ | 8,491 |
March 31, 2018 | December 31, 2017 | ||||||
Assets: | |||||||
United States | $ | 29,699 | $ | 29,945 | |||
Foreign | 18,931 | 20,539 | |||||
$ | 48,630 | $ | 50,484 |
Three Months Ended March 31, | ||||||||
2018 | 2017 | |||||||
Net loss | $ | (216 | ) | $ | (2,506 | ) | ||
Interest income | (2 | ) | (3 | ) | ||||
Income tax expense | 1 | — | ||||||
Depreciation expense | 195 | 405 | ||||||
Amortization expense | 53 | 205 | ||||||
EBITDA | 31 | (1,899 | ) | |||||
Stock compensation expense | (59 | ) | (10 | ) | ||||
ADJUSTED EBITDA | (28 | ) | (1,909 | ) |
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