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8-K - MET-PRO CORPORATION 8-K 12-6-2012 - MET PRO CORPform8k.htm
EX-99.2 - EXHIBIT 99.2 - MET PRO CORPex99_2.htm

Exhibit 99.1
 
 
Date:
December 6, 2012
 
For Release:
Immediate
 
Contact:
Investor Contact:
 
 
Neal E. Murphy
Joseph Hassett, SVP
 
Vice President of Finance, CFO
Gregory FCA Communications
 
215-723-6751
610-228-2110

Met-Pro Corporation Announces Third Quarter Financial Results
 
Net Income Increases 34% on 18% Net Sales Growth
 
Harleysville, PA, December 6, 2012 – Met-Pro Corporation (NYSE: MPR-News) today announced the Company’s financial results for the third quarter ended October 31, 2012.
 
Net sales for the third quarter ended October 31, 2012 were $29.8 million, an increase of 18% compared with net sales of $25.2 million for the same quarter last year. Net income was $2.8 million or $0.19 per diluted share, increases of 34% and 36%, respectively, when compared with net income of $2.1 million or $0.14 per diluted share for the third quarter of last year.
 
New orders received in the third quarter were $24.4 million, compared with $27.5 million for the third quarter of last year. The Company’s backlog of orders entering the fourth quarter totaled $28.6 million, which is equal to the order backlog at the same point last year.
 
“We are pleased with the results for the third quarter, which we were able to achieve despite a challenging global business environment,” commented Raymond J. De Hont, Met-Pro’s Chief Executive Officer and President. “Strong top line growth and focus on execution and cost control enabled us to achieve a 34% increase in net income. Each of the Company’s business segments was profitable for the quarter. Though the pace of firm orders received in the third quarter slowed as compared to the third quarter of last year, our order backlog and the breadth of our quotation activity remain strong. While there is continuing economic uncertainty in the U.S and other key global economies that could impact our forecasts, we expect to report growth in full year earnings this fiscal year, which would be our third consecutive year having done so, and are well positioned to continue this trend next year.”
 
Gross profit margin was 35.8% for the quarter as compared with 37.0% for the third quarter of last year and 31.1% for the second quarter of this year. Selling, general and administrative expenses were 21.5% of net sales for the current quarter as compared with 25.1% in the third quarter ended October 31, 2011 and 22.4% for the second quarter of this year.
 
Net sales for the nine months ended October 31, 2012 were $83.0 million, up 16% when compared with $71.8 million for the same period last year. Net income totaled $5.7 million and diluted earnings per share were $0.38 for the nine months ended October 31, 2012, increases of 14% and 12%, respectively, compared with net income of $5.0 million and diluted earnings per share of $0.34 for the same period last year.
 
On October 23, 2012, the Company announced a 2.1% increase in the quarterly dividend from $0.071 to $0.0725 per share, or $0.29 per share on an annualized basis. The increased dividend will be payable on December 17, 2012 to shareholders of record at the close of business on December 3, 2012. This is the twenty-second consecutive year that Met-Pro Corporation has paid a cash dividend.
 
 
Continued Page 2

 
 
Met-Pro Corporation/Page 2
 
Mr. De Hont and Neal E. Murphy, Vice President of Finance and Chief Financial Officer, will hold a conference call for investors today, December 6, 2012, at 11:00 AM (Eastern). Met-Pro’s earnings release and the accompanying financial supplement, which includes significant financial information to be discussed during the conference call, will be available on Met-Pro’s Investor Relations website at www.met-pro.com/news/news-releases prior to the beginning of the conference call.
 
Interested persons who wish to hear the live webcast should go to the Met-Pro Corporation website prior to the starting time to register, download and install any necessary audio software.
 
You may also participate by calling the US/Canada Dial-In Number 877-818-7738 or the International Dial-In Number 706-643-9333 (Conference ID 65160720) at 10:55 AM (Eastern) today. A taped replay of the conference call will be available within two hours of the conclusion of the call and until December 20, 2012. To access the taped replay, call the US/Canada Dial-In Number 855-859-2056 or the International Dial-In Number 404-537-3406 and enter Conference ID 65160720.
 
About Met-Pro
 
Met-Pro Corporation, with headquarters at 160 Cassell Road, Harleysville, Pennsylvania, is a leading niche-oriented global provider of product recovery, pollution control, fluid handling and filtration solutions. The Company’s diverse and synergistic solutions and products address the world’s growing need for clean air and water, reduced energy consumption and improved operating efficiencies. Through its global sales organization, internationally recognized brands, and operations in North America, South America, Europe and The People's Republic of China, Met-Pro’s solutions, products and systems are sold to a well-diversified cross-section of customers and markets around the world. For more information, please visit www.met-pro.com.
 

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information included in this news release, and other materials filed or to be filed with the Securities and Exchange Commission (as well as information included in oral or other written statements made or to be made by the Company), contain statements that are forward-looking. Such statements may relate to plans for future expansion, business development activities, capital spending, financing, the effects of regulation and competition, or anticipated sales or earnings results. Such information involves risks and uncertainties that could significantly affect results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of the Company. These risks and uncertainties include, but are not limited to, those relating to, the cancellation or delay of purchase orders and shipments, product development activities, goodwill impairment, computer systems implementation, dependence on existing management, the continuation of effective cost and quality control measures, retention of customers, global economic and market conditions, and changes in federal or state laws. You should carefully consider the factors discussed in Part I, “Item 1A Risk Factors” in our Annual Report on Form 10-K/A for the year ended January 31, 2012 as filed with the Securities and Exchange Commission.
 
Met-Pro common shares are traded on the New York Stock Exchange, symbol MPR.
 
To obtain an Annual Report or additional information on the Company, please call 215-723-6751 and ask for the Investor Relations Department, or visit the Company’s website at www.met-pro.com.
 
 
Continued Page 3

 
 
Met-Pro Corporation/Page 3
 
Met-Pro Corporation and Subsidiaries
Consolidated Statements of Income
(unaudited)

   
Three Months Ended
October 31,
   
Nine Months Ended
 October 31,
 
   
2012
   
2011
   
2012
   
2011
 
Net sales
  $ 29,761,356     $ 25,245,131     $ 82,965,659     $ 71,764,377  
Cost of goods sold
    19,096,841       15,910,283       54,652,514       46,234,343  
Gross profit
    10,664,515       9,334,848       28,313,145       25,530,034  
                                 
Operating expenses
                               
Selling
    3,071,621       2,944,019       9,160,574       8,784,207  
General and administrative
    3,343,147       3,387,617       10,735,827       9,437,146  
Total selling, general and administrative
    6,414,768       6,331,636       19,896,401       18,221,353  
Income from operations
    4,249,747       3,003,212       8,416,744       7,308,681  
                                 
Interest expense
    (41,470 )     (47,153 )     (125,868 )     (145,862 )
Other income
    20,110       198,317       115,782       389,647  
Income before taxes
    4,228,387       3,154,376       8,406,658       7,552,466  
                                 
Provision for taxes
    1,437,652       1,072,490       2,737,226       2,567,839  
                                 
Net income
  $ 2,790,735     $ 2,081,886     $ 5,669,432     $ 4,984,627  
                                 
Basic earnings per share
  $ .19     $ .14     $ .39     $ .34  
Diluted earnings per share
  $ .19     $ .14     $ .38     $ .34  
                                 
Average common shares outstanding:
                               
Basic shares
    14,682,776       14,659,383       14,683,286       14,659,402  
Diluted shares
    14,734,252       14,799,814       14,733,464       14,788,493  

 
Continued Page 4

 
 
Met-Pro Corporation/Page 4
 
Met-Pro Corporation and Subsidiaries
Consolidated Balance Sheets

   
October 31,
2012
   
January 31,
2012
 
Assets
 
(unaudited)
       
Current assets
           
Cash and cash equivalents
  $ 31,842,244     $ 34,581,394  
Short-term investments
    1,022,266       764,061  
Accounts receivable, net of allowance for doubtful accounts of approximately $232,000 and $491,000, respectively
    20,895,152       17,373,121  
Inventories
    18,898,950       17,847,143  
Prepaid expenses, deposits and other current assets
    1,863,546       1,683,486  
Deferred income taxes
    167,399       186,329  
Total current assets
    74,689,557       72,435,534  
                 
Property, plant and equipment, net
    18,896,612       19,322,436  
Goodwill
    20,798,913       20,798,913  
Other assets
    2,654,974       2,952,332  
Total assets
  $ 117,040,056     $ 115,509,215  
                 
Liabilities and shareholders’ equity
               
Current liabilities
               
Current portion of debt
  $ 379,592     $ 657,216  
Accounts payable
    8,134,747       7,684,739  
Accrued salaries, wages and benefits
    2,173,138       1,827,603  
Other accrued expenses
    3,991,571       2,357,929  
Dividend payable
    1,067,028       1,042,297  
Customers’ advances
    1,188,423       3,232,600  
Total current liabilities
    16,934,499       16,802,384  
                 
Long-term debt
    2,381,432       2,687,971  
Accrued pension retirement benefits
    9,307,757       10,618,047  
Other non-current liabilities
    58,039       56,391  
Deferred income taxes
    1,322,075       1,522,451  
Total liabilities
    30,003,802       31,687,244  
Commitments and contingencies
               
Shareholders’ equity
               
Common shares, $.10 par value; 36,000,000 shares authorized, 15,928,679 shares issued, of which 1,241,666 and 1,250,051 shares were reacquired and held in treasury
    1,592,868       1,592,868  
Additional paid-in capital
    4,736,738       4,058,735  
Retained earnings
    98,745,132       96,228,764  
Accumulated other comprehensive loss
    (7,768,315 )     (7,718,883 )
Treasury shares, at cost
    (10,270,169 )     (10,339,513 )
Total shareholders’ equity
    87,036,254       83,821,971  
Total liabilities and shareholders’ equity
  $ 117,040,056     $ 115,509,215  

 
Continued Page 5

 
 
Met-Pro Corporation/Page 5
 
Met-Pro Corporation and Subsidiaries
Consolidated Business Segment Data
(unaudited)

   
Three Months Ended
October 31,
   
Nine Months Ended
 October 31,
 
   
2012
   
2011
   
2012
   
2011
 
Net sales
                       
Product Recovery/Pollution Control Technologies
  $ 13,604,696     $ 11,893,296     $ 37,298,932     $ 29,851,166  
Fluid Handling Technologies
    10,634,005       7,346,897       28,349,511       24,307,152  
Mefiag Filtration Technologies
    3,037,013       3,286,624       9,412,344       9,630,925  
Filtration/Purification Technologies
    2,485,642       2,718,314       7,904,872       7,975,134  
    $ 29,761,356     $ 25,245,131     $ 82,965,659     $ 71,764,377  
                                 
Income from operations
                               
Product Recovery/Pollution Control Technologies
  $ 933,815     $ 1,064,314     $ 21,586     $ 534,986  
Fluid Handling Technologies
    3,116,729       1,747,678       7,864,387       5,890,077  
Mefiag Filtration Technologies
    123,525       127,022       419,338       517,572  
Filtration/Purification Technologies
    75,678       64,198       111,433       366,046  
    $ 4,249,747     $ 3,003,212     $ 8,416,744     $ 7,308,681  
 
                   
October 31,
 2012
   
January 31,
2012
 
Identifiable assets
                               
Product Recovery/Pollution Control Technologies
                  $ 41,305,110     $ 36,444,763  
Fluid Handling Technologies
                    20,220,234       19,290,035  
Mefiag Filtration Technologies
                    14,995,354       14,017,572  
Filtration/Purification Technologies
                    8,071,433       8,368,652  
                      84,592,131       78,121,022  
Corporate
                    32,447,925       37,388,193  
                    $ 117,040,056     $ 115,509,215  

 
Continued Page 6

 
 
Met-Pro Corporation/Page 6
 
Met-Pro Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(unaudited)
 
   
Nine Months Ended October 31,
 
   
2012
   
2011
 
Cash flows from operating activities
           
Net income
  $ 5,669,432     $ 4,984,627  
Adjustments to reconcile net income to net cash provided by operating activities:
               
Depreciation and amortization
    1,498,255       1,433,018  
Stock-based compensation
    747,347       539,478  
Deferred income taxes
    (191,247 )     (4,646 )
Loss/(gain) on sale of property and equipment, net
    1,080       (26,003 )
Allowance for doubtful accounts
    (258,714 )     53,654  
Changes in operating assets and liabilities:
               
Accounts receivable
    (3,272,233 )     (839,188 )
Inventories
    (1,063,228 )     (2,138,267 )
Prepaid expenses, deposits and other assets
    (459,659 )     (246,406 )
Accounts payable and accrued expenses
    2,395,460       2,028,062  
Customers’ advances
    (2,045,097 )     2,451,901  
Accrued pension retirement benefits
    (1,310,290 )     (2,747,053 )
Other non-current liabilities
    1,647       1,647  
                 
Net cash provided by operating activities
    1,712,753       5,490,824  
                 
Cash flows from investing activities
               
Proceeds from sale of property and equipment
          33,848  
Acquisitions of property and equipment
    (1,016,028 )     (1,636,866 )
Purchases of investments
    (1,022,266 )     (1,010,534 )
Proceeds from maturities of investments
    1,258,598       497,155  
                 
Net cash used in investing activities
    (779,696 )     (2,116,397 )
                 
Cash flows from financing activities
               
Proceeds from new borrowings
    222,778       426,802  
Reduction of debt
    (766,686 )     (625,413 )
Exercise of stock options
          42,800  
Payment of dividends
    (3,128,334 )     (2,902,505 )
Purchase of treasury shares
          (42,800 )
                 
Net cash used in financing activities
    (3,672,242 )     (3,101,116 )
Effect of exchange rate changes on cash
    35       34  
                 
Net (decrease) increase in cash and cash equivalents
    (2,739,150 )     273,345  
                 
Cash and cash equivalents at February 1
    34,581,394       32,400,814  
                 
Cash and cash equivalents at October 31
  $ 31,842,244     $ 32,674,159  

 
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