Perma-Fix Announces Financial Results and Provides Business Update for the Second Quarter of 2015
ATLANTA, GA -- (Marketwired) -- 08/06/15 --
Perma-Fix Environmental Services, Inc. (NASDAQ: PESI)today announced results for the second quarter ended June 30, 2015.
Company Highlights
Revenue increased 29.2% to $16.4 million compared to Q2 2014
Treatment Segment revenue increased 18.0% compared to Q2 2014
Services Segment revenue increased 61.5% compared to Q2 2014
Gross profit increased 159.0% and gross margin increased to 24.7% compared to 12.3% for Q2 2014
Adjusted EBITDA (as defined below) of $2 million compared to a loss of $0.4 million for Q2 2014
Reaffirms adjusted EBITDA (as defined below) guidance of $6M to $7M for 2015
Achieves $2.8 million increase in net income from continuing operations, net of taxes, to $407,000 or $0.05 per share
Dr. Louis F. Centofanti, Chief Executive Officer, stated, "We are pleased to report continued improvement in our financial results, as evidenced by a 29% increase in revenue and a 159% increase in our gross profit. Revenue in our Treatment Segment increased 18% to $11.1 million due to higher waste volume, while revenue in our Services Segment increased 61.5% to $5.3 million due to new contracts that have been awarded. Moreover, Adjusted EBITDA in the second quarter was $2.0 million, compared to a loss for the same period last year. We attribute this improvement to a combination of top line growth and our successful initiatives to streamline operations. Our second quarter results were impacted by a scheduling change that moved a large shipment into the third quarter, which we have subsequently received. We continue to anticipate improvement in both revenue and profitability in the second half of the year, and reaffirm our prior guidance for adjusted EBITDA in the range of $6 million to $7 million."
Dr. Centofanti continued, "We are also pleased to report a number of important developments within Perma-Fix Medical S.A., our Polish subsidiary, including the expansion of our senior management team and the successful scale-up of our process to produce Technetium-99m ("Tc-99m") from Molybdenum-99 ("Mo-99"). The tests confirmed that the our proprietary resins could withstand higher levels of radiation, up to 4 curies, while producing clinically useful doses of Tc-99m. These results at the 4 curie level mark a major achievement, which has attracted significant interest from within the industry."
Financial Results
Revenue for the second quarter of 2015 was $16.4 million versus $12.7 million for the same period last year. Revenue for the Treatment Segment was $11.1 million compared to $9.4 million for the same period in 2014. Revenue from the Services Segment was $5.3 million versus $3.3 million for the same period in 2014.
Gross profit for the second quarter of 2015 was $4.0 million versus $1.6 million for the second quarter of 2014. Gross margin increased to 24.7% from 12.3% for the same period last year primarily due to increased revenue generated from both segments and a reduction in certain fixed costs.
Operating income for the second quarter of 2015 was $613,000 versus an operating loss of $2.1 million for the second quarter of 2014. Operating loss for the second quarter of 2014 included a non-cash goodwill impairment charge of approximately $380,000 for our Schreiber, Yonley and Associates ("SYA") reporting unit which was divested on July 29, 2014. Net loss attributable to common stockholders for the second quarter of 2015 was $154,000, or ($0.01) per share, versus net income of $11,000 or ($0.00) per share, for the same period in 2014. Net loss attributable to common stockholders for the second quarter of 2015 included a net loss of $713,000 from discontinued operations and net income attributable to common stockholders for the second quarter of 2014 included a net income from discontinued operations of $2.4 million. Loss from discontinued operations for the second quarter of 2015 included a non-cash asset impairment charge of $150,000 on our Perma-Fix Michigan, Inc. property and a penalty payment of approximately $201,200 in connection with certain alleged violations pertaining to our Perma-Fix of South Georgia, Inc. ("PFSG") subsidiary. Income from discontinued operations for the second quarter of 2014 included a gain on insurance settlement of approximately $3.5 million for our PFSG subsidiary.
The Company recorded Adjusted EBITDA of $2.0 million from continuing operations during the quarter ended June 30, 2015, as compared to Adjusted EBITDA loss of $426,000 for the same period of 2014. The Company defines EBITDA as earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before research and development costs related to the Medical Isotope project and impairment charges on goodwill. Both EBITDA and Adjusted EBITDA are not measures of performance calculated in accordance with Generally Accepted Accounting Principles in the United States of America ("GAAP"), and should not be considered in isolation of, or as a substitute for, earnings as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. The Company believes the presentation of EBITDA and Adjusted EBITDA is relevant and useful by enhancing the readers' ability to understand the Company's operating performance. The Company's management utilizes EBITDA and Adjusted EBITDA as a means to measure performance. The Company's measurements of EBITDA and Adjusted EBITDA may not be comparable to similar titled measures reported by other companies. The table below reconciles EBITDA and Adjusted EBITDA, both non-GAAP measures, to GAAP numbers for income (loss) from continuing operations for the three and six months ended June 30, 2015 and 2014.
