Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the
fourth quarter and year ended December 31, 2020.
For the quarter ended December 31, 2020, Hudson
reported revenues of $22.1 million, a decrease of 14% compared to
revenues of $25.8 million in the comparable 2019 period. The
decrease in revenue was primarily due to decreased volume, as the
COVID-19 pandemic and the associated closures of public venues such
as commercial and recreational facilities, schools and universities
across the U.S. negatively impacted the Company’s end markets and
overall demand for refrigerants for much of the year, partially
offset by an increase in selling price of certain refrigerants.
Gross margin in the fourth quarter of 2020 was 25%, compared to 19%
in the fourth quarter of 2019, mainly due to the aforementioned
increase in selling price of certain refrigerants. Hudson reported
an operating loss of $1.7 million in the fourth quarter of 2020
compared to an operating loss of $4.8 million in the prior year
period. The Company recorded a net loss of $4.7 million or ($0.11)
per basic and diluted share in the fourth quarter of 2020, compared
to a net loss of $10.8 million or ($0.25) per basic and diluted
share in the same period of 2019. For the
year ended December 31, 2020, Hudson reported revenues of $147.6
million, a decrease of 9% compared to $162.1 million in 2019. The
decrease in revenue was primarily due to decreased volume, related
to the pandemic-driven closures described above. Gross margin for
full year 2020 improved to 24% compared to gross margin of 11% for
the full year 2019. The Company reported operating income of $5.9
million for 2020 compared to an operating loss of $15.8 million in
2019. The Company’s net loss for 2020 was $5.2 million, or ($0.12)
per basic and diluted share, compared to a net loss of $25.9
million, or ($0.61) per basic and diluted share in 2019, which
included a $9.2 million non-cash inventory adjustment mainly due to
declines in selling prices of certain refrigerants during that time
period.
Brian F. Coleman, President and Chief Executive
Officer of Hudson Technologies commented, “2020 was a challenging
year for our industry, characterized by the public health and
economic uncertainties caused by the global COVID-19 pandemic. As
we begin 2021, we are optimistic that the widespread closures
related to the virus will begin to subside and enable the broader
re-opening of our economy. With that in mind, we are planning and
preparing for the 2021 selling season so that we are ready to meet
potential demand as more cooling systems return to operation and we
look forward to fully re-engaging with our customers as they
continue to come back online.”
Conference Call Information
The Company will host a conference call and
webcast to discuss the fourth quarter results today, March 3, 2021
at 5:00 P.M. Eastern Time.
To access the live webcast, log onto the Hudson
Technologies website at www.hudsontech.com, and click on “Investor
Relations”.
To participate in the call by phone, dial (888)
506-0062 approximately five minutes prior to the scheduled start
time. International callers please dial (973) 528-0011. Callers
should use entry code: 227063.
A replay of the teleconference will be available
until April 3, 2021 and may be accessed by dialing (877) 481-4010.
International callers may dial (919) 882-2331. Callers should use
conference ID: 40141.
About Hudson Technologies
Hudson Technologies, Inc. is a leading provider
of innovative and sustainable solutions for optimizing performance
and enhancing reliability of commercial and industrial chiller
plants and refrigeration systems. Hudson's proprietary
RefrigerantSide® Services increase operating efficiency, provide
energy and cost savings, reduce greenhouse gas emissions and the
plant’s carbon footprint while enhancing system life and
reliability of operations at the same time. RefrigerantSide®
Services can be performed at a customer's site as an integral part
of an effective scheduled maintenance program or in response to
emergencies. Hudson also offers SMARTenergy OPS®, which is a
cloud-based Managed Software as a Service for continuous
monitoring, fault detection and diagnostics and real-time
optimization of chilled water plants. In addition, the Company
sells refrigerants and provides traditional reclamation services
for commercial and industrial air conditioning and refrigeration
uses. For further information on Hudson, please visit the Company's
web site at www.hudsontech.com.
Safe Harbor Statement under the Private Securities
Litigation Reform Act of 1995
Statements contained herein which are not
historical facts constitute forward-looking statements. Such
forward-looking statements involve a number of known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Such factors include, but are not limited to,
changes in the laws and regulations affecting the industry, changes
in the demand and price for refrigerants (including unfavorable
market conditions adversely affecting the demand for, and the price
of, refrigerants), the Company's ability to source refrigerants,
regulatory and economic factors, seasonality, competition,
litigation, the nature of supplier or customer arrangements that
become available to the Company in the future, adverse weather
conditions, possible technological obsolescence of existing
products and services, possible reduction in the carrying value of
long-lived assets, estimates of the useful life of its assets,
potential environmental liability, customer concentration, the
ability to obtain financing, the ability to meet financial
covenants under existing credit facilities, any delays or
interruptions in bringing products and services to market, the
timely availability of any requisite permits and authorizations
from governmental entities and third parties as well as factors
relating to doing business outside the United States, including
changes in the laws, regulations, policies, and political,
financial and economic conditions, including inflation, interest
and currency exchange rates, of countries in which the Company may
seek to conduct business, the Company’s ability to successfully
integrate any assets it acquires from third parties into its
operations, the impact of the current COVID-19 pandemic, and other
risks detailed in the Company's 10-K for the year ended December
31, 2019 and other subsequent filings with the Securities and
Exchange Commission. The words "believe", "expect",
"anticipate", "may", "plan", "should" and similar expressions
identify forward-looking statements. Readers are cautioned
not to place undue reliance on these forward-looking statements,
which speak only as of the date the statement was made.
Investor Relations Contact:John Nesbett/Jennifer
BelodeauIMS Investor Relations (203)
972-9200jnesbett@institutionalms.com |
Company Contact:Brian F. Coleman, President &
CEOHudson Technologies, Inc.(845)
735-6000bcoleman@hudsontech.com |
Hudson Technologies, Inc. and
SubsidiariesConsolidated Balance
Sheets(Amounts in thousands, except for share and par
value amounts)
|
|
December 31, |
|
|
|
2020 |
|
|
2019 |
|
Assets |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,348 |
|
|
$ |
2,600 |
|
Trade accounts receivable – net |
|
|
9,806 |
|
|
|
8,061 |
|
Inventories |
|
|
44,460 |
|
|
|
59,238 |
|
Prepaid expenses and other current assets |
|
|
6,528 |
|
|
|
4,525 |
|
Total current assets |
|
|
62,142 |
|
|
|
74,424 |
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment,
less accumulated depreciation |
|
|
21,910 |
|
|
|
23,674 |
|
Goodwill |
|
|
47,803 |
|
|
|
47,803 |
|
Intangible assets, less
accumulated amortization |
|
|
23,150 |
|
|
|
26,012 |
|
Right of use asset |
|
|
6,559 |
|
|
|
8,048 |
|
Other assets |
|
|
85 |
|
|
|
192 |
|
Total Assets |
|
$ |
161,649 |
|
|
$ |
180,153 |
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Trade accounts payable |
|
$ |
7,644 |
|
|
$ |
10,274 |
|
Accrued expenses and other current liabilities |
|
|
19,417 |
|
|
|
18,120 |
|
Accrued payroll |
|
|
1,394 |
|
|
|
724 |
|
Current maturities of long-term debt |
|
|
7,314 |
|
|
|
3,008 |
|
Short-term debt |
|
|
2,000 |
|
|
|
14,000 |
|
Total current liabilities |
|
|
37,769 |
|
|
|
46,126 |
|
Deferred tax liability |
|
|
1,355 |
|
|
|
1,192 |
|
Long-term lease
liabilities |
|
|
3,927 |
|
|
|
5,742 |
|
Long-term debt, less current
maturities, net of deferred financing costs |
|
|
77,976 |
|
|
|
81,982 |
|
Total Liabilities |
|
|
121,027 |
|
|
|
135,042 |
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
|
|
|
|
|
Preferred stock, shares authorized 5,000,000: Series A Convertible
preferred stock, $0.01 par value ($100 liquidation preference
value); shares authorized 150,000; none issued or outstanding |
|
|
— |
|
|
|
— |
|
Common stock, $0.01 par value; shares authorized 100,000,000;
issued and outstanding: 43,347,887 and 42,628,560,
respectively |
|
|
433 |
|
|
|
426 |
|
Additional paid-in capital |
|
|
118,269 |
|
|
|
117,557 |
|
Accumulated deficit |
|
|
(78,080 |
) |
|
|
(72,872 |
) |
Total Stockholders' Equity |
|
|
40,622 |
|
|
|
45,111 |
|
|
|
|
|
|
|
|
|
|
Total Liabilities and
Stockholders' Equity |
|
$ |
161,649 |
|
|
$ |
180,153 |
|
|
|
|
|
|
|
|
|
|
Hudson Technologies, Inc. and
SubsidiariesConsolidated Statements of
Operations(unaudited)(Amounts in
thousands, except for share and per share amounts)
|
|
Three months ended December
31, |
|
|
Twelve monthsended December
31, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
22,110 |
|
|
$ |
25,753 |
|
|
$ |
147,605 |
|
|
$ |
162,059 |
|
Cost of
sales |
|
|
16,684 |
|
|
|
20,989 |
|
|
|
112,195 |
|
|
|
144,894 |
|
Gross
profit |
|
|
5,426 |
|
|
|
4,764 |
|
|
|
35,410 |
|
|
|
17,165 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
6,460 |
|
|
|
8,864 |
|
|
|
26,644 |
|
|
|
30,018 |
|
Amortization |
|
|
715 |
|
|
|
715 |
|
|
|
2,862 |
|
|
|
2,931 |
|
Total operating expenses |
|
|
7,175 |
|
|
|
9,579 |
|
|
|
29,506 |
|
|
|
32,949 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) |
|
|
(1,749 |
) |
|
|
(4,815 |
) |
|
|
5,904 |
|
|
|
(15,784 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(2,918 |
) |
|
|
(5,990 |
) |
|
|
(12,330 |
) |
|
|
(18,911 |
) |
Other income (expense) |
|
|
22 |
|
|
|
(1 |
) |
|
|
1,033 |
|
|
|
9,411 |
|
Total other expense |
|
|
(2,896 |
) |
|
|
(5,991 |
) |
|
|
(11,297 |
) |
|
|
(9,500 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes |
|
|
(4,645 |
) |
|
|
(10,806 |
) |
|
|
(5,393 |
) |
|
|
(25,284 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit) |
|
|
103 |
|
|
|
(35 |
|
|
|
(185 |
) |
|
|
656 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(4,748 |
) |
|
$ |
(10,771 |
) |
|
$ |
(5,208 |
) |
|
$ |
(25,940 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share – Basic |
|
$ |
(0.11 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.12 |
) |
|
$ |
(0.61 |
) |
Net loss per common share – Diluted |
|
$ |
(0.11 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.12 |
) |
|
$ |
(0.61 |
) |
Weighted average number of shares outstanding – Basic |
|
|
42,881,307 |
|
|
|
42,628,560 |
|
|
|
42,710,381 |
|
|
|
42,613,478 |
|
Weighted average number of shares outstanding – Diluted |
|
|
42,881,307 |
|
|
|
42,628,560 |
|
|
|
42,710,381 |
|
|
|
42,613,478 |
|
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