For Release 4:00 EST, Thursday, November 5, 2009
TOR Minerals Announces Third Quarter 2009 Financial Results
CORPUS CHRISTI, Texas, November 5, 2009 – TOR Minerals International (Nasdaq: TORM), producer of synthetic titanium dioxide and color pigments, specialty aluminas, and other high performance mineral fillers, today announced its financial results for the third quarter ended September 30, 2009. The company reported a net loss available to common shareholders of ($32,000), or ($0.00) per diluted share, on net sales of $6,441,000 for the quarter ended September 30, 2009. This compares with a net loss available to common shareholders of ($385,000), or ($0.05) per diluted share, on net sales of $7,503,000 for the quarter ended September 30, 2008.
Net sales decreased 14 percent during the third quarter of 2009 primarily due to a 28 percent decrease in HITOX® sales. Although weakness in paint and plastics markets continued to negatively affect year-over-year HITOX sales comparisons, HITOX sales levels stabilized in the third quarter and were flat in comparison with the second quarter of 2009. During the third quarter of 2009, sales of specialty alumina products increased 5 percent versus the third quarter of 2008 as a weakness in European alumina sales was more than offset by new business and strengthening in the United States.
During the third quarter of 2009, the company reported an operating profit of $208,000, compared to an operating loss of ($144,000) during the third quarter of 2008. In addition to lower energy and raw materials costs, several factors contributed to the improvement in third quarter profitability, including a change in revenue mix, a 23 percent reduction of indirect production costs, and a 35 percent reduction in SG&A expenses.
Commenting on the results, Dr. Olaf Karasch, Chief Executive Officer said, “Due to cost cutting measures, new, low-cost processing technologies and the dedicated efforts of our employees, we have shown sequential improvements in operating income during each of the first three quarters of this fiscal year. We are now better positioned to weather a continued market downturn and should benefit as market conditions improve.”
The company said that it is targeting improvement in financial results during the fourth quarter of 2009. “In addition to bringing our cost structure in line with lower sales levels, we have introduced several new high value-added products to the market. In particular, our newly introduced specialty alumina products are garnering significant customer interest. These new products address sizable markets and have relatively short sales cycles. Their introduction and market acceptance, if successful, can help to improve top line performance and plant utilization, which is key to returning TOR to meaningful profitability,” continued Dr. Karasch.
A webcast discussing third quarter 2009 results can be accessed for a period of 30 days via the News section of the TOR Minerals’ website at www.torminerals.com.
Headquartered in Corpus Christi, Texas, TOR Minerals International is a global manufacturer and marketer of specialty mineral and pigment products for high performance applications with manufacturing and regional offices located in the United States, Netherlands and Malaysia.
Contact for Further Information:
David
Mossberg
Three Part Advisors, LLC
(817) 310-0051
Financial Tables Follow
TOR Minerals International, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share amounts) Three Months Nine Months Ended September 30, Ended September 30, 2009 2008 2009 2008 NET SALES $6,441 $7,503 $17,798 $21,165 Cost of sales 5,492 6,527 15,170 18,525 GROSS MARGIN 949 976 2,628 2,640 Technical services and research and development 54 62 146 189 Selling, general and administrative expenses 687 1,058 2,423 3,287 Gain on disposal of assets - - - (2) OPERATING INCOME (LOSS) 208 (144) 59 (834) OTHER INCOME (EXPENSE): Interest income - - 2 1 Interest expense (159) (134) (407) (409) Gain (loss) on foreign currency exchange rate (5) (4) 37 (5) Other, net - 1 4 11 INCOME (LOSS) BEFORE INCOME TAX 44 (281) (305) (1,236) Income tax expense (benefit) 61 89 (11) 61 NET LOSS $(17) $(370) $(294) $(1,297) Less: Preferred Stock Dividends 15 15 45 45 Loss Available to Common Shareholders $(32) $(385) $(339) $(1,342) Loss per common share: Basic $(0.00) $(0.05) $(0.04) $(0.17) Diluted $(0.00) $(0.05) $(0.04) $(0.17) Weighted average common shares outstanding: Basic 9,453 7,878 9,453 7,876 Diluted 9,453 7,878 9,453 7,876 TOR Minerals International, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands, except per share amounts) September 30, December 31, 2009 2008 (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 893 $ 191 Trade accounts receivable, net 3,021 2,310 Inventories, net 9,815 11,839 Other current assets 794 444 TOTAL CURRENT ASSETS 14,523 14,784 PROPERTY, PLANT AND EQUIPMENT, net 19,237 19,515 OTHER ASSETS 58 38 Total Assets $ 33,818 $ 34,337 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 1,268 $ 2,268 Accrued expenses 1,227 1,611 Notes payable under lines of credit 3,149 2,156 Export credit refinancing facility 1,023 1,458 Current deferred tax liability 60 56 Current maturities - capital leases 158 86 Current maturities of long-term debt– financial institutions 858 1,590 Total current liabilities 7,743 9,225 LONG-TERM DEBT, EXCLUDING CURRENT MATURITIES Capital leases 74 141 Long-term debt – financial institutions 1,499 1,876 Long-term debt – convertible debentures, net 1,105 - Deferred tax liability 559 580 Total liabilities 10,980 11,822 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Series A 6% convertible preferred stock $.01 par value: authorized, 5,000 shares; 200 shares issued and outstanding at 9/30/09 and 12/31/08 2 2 Common stock $.25 par value: authorized, 30,000 shares; 9,453 shares issued and outstanding at 9/30/09 and at 12/31/08, respectively 2,363 2,363 Additional paid-in capital 25,025 24,525 Accumulated deficit (7,950) (7,611) Accumulated other comprehensive income: Cumulative translation adjustment 3,398 3,236 Total shareholders' equity 22,838 22,515 Total Liabilities and Shareholders' Equity $ 33,818 $ 34,337 TOR Minerals International, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Nine Months Ended September 30, 2009 2008 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (294) $ (1,297) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation 1,340 1,483 Stock-based compensation expense 78 119 Warrant interest expense 27 - Gain on sale/disposal of property, plant and equipment - (2) Deferred income taxes (17) 51 Provision for bad debt (61) 51 Changes in working capital: Receivables (384) (1,240) Inventories 2,056 1,223 Other current assets (324) (189) Accounts payable and accrued expenses (1,436) 1,592 Net cash provided by operating activities 985 3,891 CASH FLOWS FROM INVESTING ACTIVITIES: Additions to property, plant and equipment (807) (1,740) Proceeds from sales of property, plant and equipment - 3 Net cash used in investing activities (807) (1,737) CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds / (payments) from lines of credit 926 (2,903) Net proceeds from export credit refinancing facility (432) 759 Net payments on capital leases (4) (34) Proceeds from long-term bank debt - 2,049 Payments on long-term bank debt (1,208) (1,809) Proceeds from convertible debentures 1,500 - Proceeds from the issuance of common stock through exercise of common stock options - 12 Preferred stock dividends paid (45) (45) Net cash provided by (used in) financing activities 737 (1,971) Effect of exchange rate fluctuations on cash and cash equivalents (213) (116) Net change in cash and cash equivalents 702 67 Cash and cash equivalents at beginning of period 191 376 Cash and cash equivalents at end of period $ 893 $ 443 Supplemental cash flow disclosures: Interest paid $ 377 $ 409 Taxes paid $ 8 $ 7