) reported profit of $9.8 million or 18 cents per share in the
first quarter of 2014, flat year over year. Earnings per share were
in line with the Zacks Consensus Estimate.
The Pennsylvania-based pollution control company posted revenues of
$131.6 million in the reported quarter, down 2.5% year over year.
Lower sales across activated carbon and equipment businesses offset
an increase in the consumer unit. Currency translation also
unfavourably affected sales, stemming from a weaker yen. Sales also
matched the Zacks Consensus Estimate.
Calgon Carbon provided an upbeat outlook for the second quarter,
expecting sales for the quarter to be one of the best in its
history. Its shares were up as much as 5.4% in the trading session
following the announcement. The stock has gained around 26% over a
Revenues from the company's core Activated Carbon and Service
segment edged down 1% year over year to $117.7 million in the
quarter due to lower demand for activated carbon products across
municipal drinking water market in the U.S., environmental air
market in Asia and industrial process market in Europe, offset by
increased demand for granular activated carbon in the food market.
Equipment division's revenues fell 24.7% year over year to $10.5
million on lower sales for ballast water treatment and traditional
ultraviolet light systems.
Sales from the Consumer segment jumped 54% year over year to $3.4
million in the quarter on increased demand for activated carbon
cloth from a major customer.
Calgon Carbon ended the quarter with cash and cash equivalents of
$36.2 million, a roughly two-and-a-half fold year over year rise.
Total debt was $55.7 million, down roughly 13% year over year but
up around 62% sequentially.
Calgon Carbon expects sales to rise more than 10% sequentially in
the second quarter on strength in the global drinking water market.
The quarter is expected to be strong for both sales and earnings.
Increased sales volumes, favourable sales mix and cost-saving
measures are expected to contribute to a significant sequential
improvement in margins.
Calgon Carbon has reduced its capital spending target for 2014 and
now expects to spend between $75 million and $80 million for the
year versus $85 million expected earlier. It made capital spending
of roughly $8.6 million in the reported quarter.
Calgon Carbon should benefit from the implementation of cost
reduction program and corporate initiatives. Moreover, the company
will continue to capitalize on opportunities for revenue growth
from environmental regulations for mercury removal from coal-fired
power plants and for ballast water treatment.
Calgon Carbon is a Zacks Rank #3 (Hold) stock.
Other companies in the pollution control industry worth considering
Vertex Energy, Inc.
Pure Cycle Corporation
). While Fuel-Tech and Vertex carry a Zacks Rank #1 (Strong Buy),
Pure Cycle sports a Zacks Rank #2 (Buy).
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CALGON CARBON (CCC): Free Stock Analysis Report
FUEL TECH INC (FTEK): Free Stock Analysis
PURE CYCLE CORP (PCYO): Free Stock Analysis
VERTEX ENERGY (VTNR): Free Stock Analysis
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