For Release: November 6, 2007, 3:00 pm Eastern time
TOR Minerals Announces Third Quarter 2007 Financial Results
CORPUS CHRISTI, Texas, November 6th, /PRNewswire-FirstCall/ -- TOR Minerals International (Nasdaq: TORM - News), producer of synthetic titanium dioxide and color pigments, specialty alumina, and other high performance mineral fillers today announced its financial results for the third quarter ended September 30, 2007. The company reported net income available to common shareholders of $150,000, or $0.02 per fully diluted share, on net sales of $7,558,000. This compares with net income available to common shareholders of $1,000, or $0.00 per share, on net sales of $6,998,000 for the quarter ended September 30, 2006.
Net sales for the nine months ended September 30, 2007, were $21,992,000 compared to $20,724,000 during the nine-month period ended September 30, 2006. The net income available to common shareholders was $241,000, or $0.03 per diluted share, for the nine months ended September 30, 2007 compared to net income of $308,000, or $0.04 per share, for the same period a year ago.
Net sales grew 8% in the third quarter of 2007 compared to the third quarter of last year. Specialty alumina sales grew 105%, which increase was partially offset by a 12% decrease in Hitox® sales and 7% decrease in all other sales. Profitability improved during the quarter due to increased sales of higher margin products and cost reductions achieved through process improvements, which were partially offset by increased energy costs, raw material costs, and interest expense.
Highlights for the quarter include an increase in specialty alumina sales in Europe which was driven by a combination of new product introductions and sales to new customers. Sales of Hitox were negatively affected by a general weakness in demand, particularly in the U.S. housing construction industry.
“Our global product and market diversification strategy produced a net sales gain as increased specialty alumina sales in Europe offset declines in Hitox revenue in the United States. Specialty alumina sales accounted for 30% of our revenue during the quarter, up from 16% a year ago. Increased utilization of our Netherlands facility combined with increased sales of value-added specialty alumina products and improvements in operation efficiencies made our alumina business the major contributor to profitability during the quarter,” said Dr. Olaf Karasch, CEO of TOR Minerals.
Dr. Karasch continued, “During the quarter, we made significant strides in developing the next generation of value-added products, which we are introducing as heat and ultraviolet (UV) stable color pigments. We are aggressively moving forward with production and market development plans to introduce these new products, which we believe have the potential to significantly expand the addressable market for our products. In addition, we are continuing to make progress in reducing costs through improved processes to offset increasing raw material and energy costs.”
The company announced plans to produce synthetic rutile in the months of November and December in order to maintain stocking levels and in anticipation of the introduction of the new pigment products in 2008.
TOR Minerals will host a conference call at 4:00 p.m. Central Time on November 6, 2007 to further discuss third quarter results. The call will be simultaneously web-cast, and can be accessed via the News section on the company's website at http://www.torminerals.com . Interested parties may also access the conference call via telephone by dialing 877-407-9210.
Based in Corpus Christi, Texas, TOR Minerals is an international manufacturer of specialty mineral products for high performance applications with plants and regional offices located in the United States, The Netherlands and Malaysia.
This statement provides forward-looking information as that term is defined in the Private Securities Litigation Reform Act of 1995, and, therefore, is subject to certain risks and uncertainties. There can be no assurance that the actual results, business conditions, business developments, losses and contingencies and local and foreign factors will not differ materially from those suggested in the forward-looking statements as a result of various factors, including market conditions, general economic conditions, including the present slow down in U.S. construction and the risks of a general business slow down or recession, the increasing cost of energy, raw materials and labor, competition, the receptivity of the markets for our anticipated new products, advances in technology, changes in foreign currency rates, freight price increase, commodity price increases, delays in delivery of required equipment and other factors.
Contact for Further Information:
David Mossberg
Beacon Street Group, LLC
(817) 310-0051
TOR Minerals International, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(Unaudited)
(In thousands, except per share amounts)
Three Months Nine Months
Ended September 30, Ended September 30,
2007 2006 2007 2006
NET SALES $7,558 $6,998 $21,992 $20,724
Cost of sales 6,082 5,760 17,739 16,392
GROSS MARGIN 1,476 1,238 4,253 4,332
Technical services and research
and development 65 47 183 185
General, administrative and
selling expenses 1,055 1,028 3,276 3,232
OPERATING INCOME 356 163 794 915
OTHER INCOME (EXPENSE):
Interest income 8 4 11 15
Interest expense (179) (142) (518) (399)
Gain (loss) on foreign currency
exchange rate (35) (23) 16 (54)
INCOME BEFORE INCOME TAX 150 2 303 477
Income tax expense (benefit) (15) (14) 17 124
NET INCOME $165 $16 $286 $353
Less: Preferred Stock Dividends 15 15 45 45
Income Available to Common
Shareholders $150 $1 $241 $308
Income per common share:
Basic $0.02 $0.00 $0.03 $0.04
Diluted $0.02 $0.00 $0.03 $0.04
Weighted average common shares
outstanding:
Basic 7,844 7,837 7,672 7,834
Diluted 7,844 7,864 7,729 7,886
TOR Minerals International, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except per share amounts)
September 30, December 31,
2007 2006
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $739 $896
Trade accounts receivable, net 4,793 3,593
Inventories, net 11,168 10,949
Other current assets 921 555
Total current assets 17,621 15,993
PROPERTY, PLANT AND EQUIPMENT, net 20,217 20,034
GOODWILL 2,084 1,927
OTHER ASSETS 50 57
$39,972 $38,011
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $1,628 $2,036
Accrued expenses 2,106 2,062
Notes payable under lines of credit 1,403 811
Current deferred tax liability 397 401
Current maturities - Capital leases 74 65
Current maturities of long-term debt
- Financial Institutions 605 580
Current maturities of long-term debt
- Related Parties -- 400
Total current liabilities 6,213 6,355
LONG-TERM DEBT, EXCLUDING CURRENT
MATURITIES
Capital leases 220 254
Long-term debt - Financial
Institutions 3,173 2,835
Notes payable under lines of credit 3,875 3,525
DEFERRED TAX LIABILITY 238 213
Total liabilities 13,719 13,182
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Series A 6% convertible preferred
stock $.01 par value:
authorized, 5,000 shares; 200 shares
issued and outstanding 2 2
Common stock $.25 par value:
authorized, 10,000 shares;
7,839 shares issued and outstanding
at 6/30/07 and 12/31/06 1,964 1,960
Additional paid-in capital 22,834 22,652
Accumulated deficit (2,359) (2,600)
Accumulated other comprehensive
income:
Unrealized gain (loss) on derivatives 3 81
Cumulative translation adjustment 3,809 2,734
Total shareholders' equity 26,253 24,829
$39,972 $38,011
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