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Hey all, I put together a collection of trading related books and thought peeps here might get some use out of them. Enjoy and happy trading....
http://www.box.net/shared/prdbtjohn6
August 13, 1987
Red Rocks Ampitheater
Morrison, CO
http://www.archive.org/download/gd1987-08-13.sbd.unknown.7992.sbeok.shnf/gd1987-08-13.sbd.unknown.7992.sbeok.shnf_vbr.m3u
source: sbd > mc > dat X3 > wav > shn
NR applied using CEP
Disc 1
Set 1
1. Big Boss Man
2. Jack Straw
3. Row Jimmy
4. It's All Over Now
5. Loser//
6. Cassidy
7. Far From Me
8. Box Of Rain
Set 2
9. Uncle John's Band ->
10. Estimated Prophet ->
Disc 2
1. He's Gone ->
2. Drums ->
3. S//pace ->
4. The Wheel ->
5. Gimme Some Lovin' ->
6. Stella Blue ->
7. Throwing Stones ->
8. Not Fade Away
...NFA chant...
E:
9. Touch Of Gray ->
10. Knockin' On Heaven's Door
notes:
Some kind of static d1t01@ 4:56, cassette flips @ end of Loser and d2t03 @ :26,
pause in d2t06 @ 6:29
Sector boundaries fixed with shntool.
Yep, I saw those and it got me started on this collection which has a couple hundred more I found. That box site is pretty cool.
gl
MEA...banging out the new lows.
I wanna be there when it starts glowing again...hehehe
Hey BB and friends,
I came upon a nice collection of trading related books that I thought others might get some use out of too. A little education can be a dangerous thing.
Enjoy!
http://www.box.net/shared/prdbtjohn6
Ambient Corporation Announces Second Quarter Financial Results
Sets Record for First Half Revenue
Boston, Mass.,
August 11, 2010 -Ambient Corporation (OTCBB: ABTG) today announced financial
results for the second quarter ended June 30, 2010. The Company posted record revenues
of approximately $6.3
million for the six months ended June 30, 2010.
Ambient's milestones
for the first half of the year include the launching of the Open Smart Grid
Communications Architecture with Verizon Wireless and its newest "all-in-one"
solution, the Ambient X-3100 smart grid node. The Company also eliminated its long-term
debt, had a significant
increase in revenue opportunity, and its operating loss for the three months
ended June 30, 2010 narrowed to $595,543 as compared to $2,330,128 for the
corresponding period in 2009. Narrowing its operating loss allowed the Company to
reduce its
dependency over the quarter on the equity-based credit line first established
in 2009.
"We have had a very strong start to the year that has met our expectations all
around, especially with the successful product launch of our third generation
smart grid node, the X-3100," said John J. Joyce, President and CEO of Ambient
Corporation. "We are very encouraged by our growth and progress thus far
in 2010. Our success is the direct
result of our focus on innovation and providing a market leading, best-in-class
smart grid communications solution to the utility industry. We remain confident
about our outlook, the
new products we're developing, our relationship with our marquee customer and
the future growth of the Company."
A detailed description of
Ambient's business, our results of operations and financial statements are
contained in the Quarterly Report on Form 10-Q filed on August 10, 2010.
Operations Highlights -
Second Quarter
REVENUE. Revenues for the
six and three months ended June 30, 2010 were $6,258,142 and $4,574,217,
respectively, compared to $857,183 and $30,590 for the corresponding periods in
2009. Revenues for each of the 2010 and 2009 periods were attributable to the
sales of Products and software and services to our marquee customer. Revenues
for the six and three months ended June 30, 2010 related to the sales of
Products totaled $6,220,422 and $4,555,357, respectively, compared to $823,253
and $30,590 for the corresponding periods in 2009. Revenue from the sale of
software and services for the six and three months ended June 30, 2010 were
$37,720 and $18,860, respectively, compared to $33,930 and $0 for the corresponding
periods in 2009. The increase in revenue during the 2010 periods compared to
the corresponding periods in 2009 reflects an increase in delivery of Ambient's
X-3100 Product base to fulfill purchase orders received from our marquee
customer.
To date, we have received
from our marquee customer purchase orders for approximately $21 million for our
X-3100 Product.
COST OF GOODS SOLD. Cost
of goods sold for the six and three months ended June 30, 2010 were $3,782,123
and $2,641,085, respectively, compared to $756,854 and $25,618 for the
corresponding periods in 2009. Cost of goods sold included all costs related to
manufacturing and selling Product and consisted primarily of direct material.
Cost of goods sold for the 2010 and 2009 periods included an inventory write
down of excess and obsolete inventory. The increase in cost of goods sold
during the 2010 period reflected the increase in production to fill orders
placed by our marquee customer.
GROSS PROFIT. Gross profit
for the six and three months ended June 30, 2010 period were $2,476,019 and
$1,933,132, respectively, compared to $100,329 and $4,972 for the corresponding
periods in 2009. The gross profit on Product sales amounted to $2,438,298 and
$66,399, respectively, for the six and three month periods ended June 30, 2010,
compared to $1,914,272 and $4,972 for the corresponding periods in 2009. Our
overall gross margins increased to 42% and 40% for each of the six and three
month periods in 2010 compared to 12% and 16% in the corresponding periods in
2009. The increase in the gross margin percentage in the 2010 periods compared
to the 2009 periods was due to the introduction of the X-3100 which allowed for
a number of factors including a consistent production and delivery schedule in
2010 and improved cost controls. The gross profit margins for the 2009 periods
were
lower due to the
previous design of the product and low volume production.
About Ambient Corporation
Ambient designs, develops and markets Ambient Smart Grid®communications technologies
and equipment. Using open standards-based
technologies along with in-depth industry experience, Ambient provides
utilities with solutions for creating smart grid communication platforms and
technologies. Headquartered in Newton, MA, Ambient is a publicly traded company
(OTCBB: ABTG). More information on Ambient is available at www.ambientcorp.com [http://r20.rs6.net/tn.jsp?et=1103610555734&s=1336&e=001LME9NZOCcd51P2w3HrFsq-_qhkgxVf3L4baFabpO6w5jVYYnkD3j0NQoGG_Aifu4UmSQqwEpJMoCz6u1lxr_0jE3G2-0br6uGObb09FYFXzuzkxNd-v-zg==].
This press
release contains forward-looking statements that involve substantial uncertainties
and risks. These forward-looking statements are based upon our current
expectations, estimates and projections about our business and our industry,
and that reflect our beliefs and assumptions based upon information available
to us at the date of this release. We caution readers that forward-looking
statements are predictions based on our current expectations about future
events. These forward-looking statements are not guarantees of future
performance and are subject to risks, uncertainties and assumptions that are
difficult to predict. Our actual results, performance or achievements could
differ materially from those expressed or implied by the forward-looking
statements as a result of a number of factors, including but not limited to,
our dependence on one key customer, our ability to raise additional capital
when needed, the sufficiency of working capital, the timing and delivery of
purchase orders and receipt of payment in respect thereof, the risk of market
acceptance of new products and underlying technologies, the competitive market
generally and in the smart grid market specifically, the success of our
collaborative arrangements, changes in economic conditions generally and the
smart grid market specifically, changes in technology, legislative or
regulatory changes that affect us, and the risks and uncertainties discussed
under the heading "RISK FACTORS" in Item 1A of our Annual Report on
Form 10-K for the fiscal year ended December 31, 2009, and in our other filings
with the Securities and Exchange Commission. We undertake no obligation to
revise or update any forward-looking statement for any reason.
Ambient, Ambient
Smart Grid, Communications for a Smarter Grid and AmbientNMS are registered
trademarks of Ambient Corporation with the U.S. Patent and Trademark Office.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Follow Ambient
Follow us on Twitter [http://twitter.com/AmbientCorp]Find us on Facebook [http://www.facebook.com/search/?post_form_id=fb3f14fe77c03eb915bb7c597286b4d9&q=Ambient+Corporation&init=quick&ref=search_loaded#%21/pages/Ambient-Corporation/129995732590?ref=search&sid=590084781.718496423..1]
You want ME to tell you how you should perceive this???LOL
I think the continued build out of the Duke grid with Ambient gear is great. Another ute in the pipeline would be awesome. Nobody wants one customer, even if it is Goliath.
Any development of the Verizon deal would be a chart buster too. So, in many senses, it's MOTS (more of the same) which was pretty good to begin with,IMO.
Heck, we might actually start making money soon! That happens and it's wheels up,imo.
Are there threats of dilution? You betcha! Does Vicis worry me? Not so much as the other sweethearts of the Cambridge rodeo that have been liquidating their abtg for years and years.
Check the windsock.
OK, now you go....
ABTG...10Q Filing:
http://ih.advfn.com/p.php?pid=nmona&article=43958932&symbol=ABTG
RESULTS OF OPERATIONS
COMPARISON OF THE SIX AND THREE MONTHS ENDED JUNE 30, 2010 TO THE SIX AND THREE MONTHS ENDED JUNE 30, 2009
REVENUE. Revenues for the six and three months ended June 30, 2010 were $6,258,142 and $4,574,217, respectively, compared to $857,183 and $30,590 for the corresponding periods in 2009. Revenues for each of the 2010 and 2009 periods were attributable to the sales of Products and software and services to our marquee customer. Revenues for the six and three months ended June 30, 2010 related to the sales of Products totaled $6,220,422 and $4,555,357, respectively, compared to $823,253 and $30,590 for the corresponding periods in 2009. Revenue from the sale of software and services for the six and three months ended June 30, 2010 were $37,720 and $18,860, respectively, compared to $33,930 and $0 for the corresponding periods in 2009. The increase in revenue during the 2010 periods compared to the corresponding periods in 2009 reflects an increase in delivery of Ambient’s X-3100 Product base to fulfill purchase orders received from our marquee customer.
To date, we have received from our marquee customer purchase orders for approximately $21 million for our X-3100 Product.
COST OF GOODS SOLD. Cost of goods sold for the six and three months ended June 30, 2010 were $3,782,123 and $2,641,085, respectively, compared to $756,854 and $25,618 for the corresponding periods in 2009. Cost of goods sold included all costs related to manufacturing and selling Product and consisted primarily of direct material. Cost of goods sold for the 2010 and 2009 periods included an inventory write down of excess and obsolete inventory. The increase in cost of goods sold during the 2010 period reflected the increase in production to fill orders placed by our marquee customer.
GROSS PROFIT. Gross profit for the six and three months ended June 30, 2010 period were $2,476,019 and $1,933,132, respectively, compared to $100,329 and $4,972 for the corresponding periods in 2009. The gross profit on Product sales amounted to $2,438,298 and $66,399, respectively, for the six and three month periods ended June 30, 2010, compared to $1,914,272 and $4,972 for the corresponding periods in 2009. Our overall gross margins increased to 42% and 40% for each of the six and three month periods in 2010 compared to 12% and 16% in the corresponding periods in 2009. The increase in the gross margin percentage in the 2010 periods compared to the 2009 periods was due to the introduction of the X-3100 which allowed for a number of factors including a consistent production and delivery schedule in 2010 and improved cost controls. The gross profit margins for the 2009 periods were lower due to the previous design of the product and low volume production.
RESEARCH AND DEVELOPMENT EXPENSES. Research and development expenses consisted of expenses incurred primarily in designing, developing and field testing our smart grid solutions. These expenses consisted primarily of salaries and related expenses for personnel, contract design and testing services, supplies used and consulting and license fees paid to third parties. Research and development expenses for the six and three months ended June 30, 2010 period were $2,958,554 and $1,393,654, respectively, compared to $2,017,105 and $1,105,396 for the corresponding periods in 2009. The increase in research and development during the 2010 periods was due primarily to the increase in personnel and consultants for the continued development of our fourth generation communications node. We expect that our research and development expenses will increase as we continue to focus our efforts on developing more robust solutions and additional value-added functionality for the Ambient Smart Grid® communications platforms.
OPERATING, GENERAL AND ADMINISTRATIVE EXPENSES. Operating, general and administrative expenses primarily consisted of salaries and other related costs for personnel in executive and other administrative functions. Other significant costs included professional fees for legal, accounting and other services. General and administrative expenses for the six and three months ended June 30, 2010 were $2,286,488 and $1,129,762 respectively, compared to $2,136,900 and $1,071,316 for the corresponding periods in 2009 The increase in operating, general and administrative expenses during the 2010 periods as compared to the 2009 periods was due to the increase in efforts to market and commercialize the Ambient Smart Grid® communications platforms. As we continue to increase our efforts to market and commercialize the Ambient Smart Grid® communications platform, we expect our operating, general and administrative expenses to increase for the remainder of the fiscal year 2010.
STOCK BASED COMPENSATION. A portion of our operating expenses were attributable to non-cash charges associated with the compensation of consultants and employees through the issuance of stock options and stock grants. Stock-based compensation is a non-cash expense and will therefore have no impact on our cash flows or liquidity. For the six and three months ended June 30, 2010, we incurred non-cash stock-based compensation expense of $35,190 and $5,259, respectively, compared to $471,062 and $248,388 for the corresponding periods in 2009.
INTEREST AND FINANCE EXPENSES. For the six and three months ended June 30, 2010, we incurred interest of $29,358 and $493, respectively, compared to $334,215 and $166,764 for the corresponding periods in 2009. The interest related primarily to our 8% Secured Convertible Promissory Notes, which were issued in July and November of 2007 and January 2008. Additionally, for the six and three months ended June 30, 2010, we incurred non-cash interest of $183,609 and $0 , respectively, compared to 2,880,249 and $1,182,651 for the corresponding periods in 2009. This interest related to the amortization of the beneficial conversion features and deferred financing costs incurred in connection with the placement of our convertible promissory notes. These costs are amortized to the date of maturity of the debt unless converted earlier. In January 2010, Vicis converted the remaining $10 million outstanding on the notes. Following the conversion of the notes, we no longer have any long-term debt. In addition, on June 30, 2009, we agreed to modify the terms of the expiring Class A warrants. Under the new terms the warrants were exercisable through August 31, 2009 and the exercise prices were reduced from $0.20 to $0.15 per share. The resulting charge due to the modification was $1,147,167 and was reflected as additional interest expense.
Thank you, scion!...eom
No, but thanks for bringing that!
The JBII product is seen here:
Question-and-Answer Session
http://seekingalpha.com/article/219331-metalico-inc-q2-2010-earnings-call-transcript?part=qanda
Operator
(Operator Instructions) Your first question comes from the line of Brent Thielman from D.A. Davidson. Your line is now open.
Brent Thielman - D.A. Davidson
Hi, good morning.
Carlos Aguero
Good morning.
Brent Thielman - D.A. Davidson
I guess I’m trying to understand the sequential decline in gross margins a little better. I mean in the past we have seen the seasonality in ferrous scrap, whereas we enter the spring, prices tend to cool and when I look at previous years, I guess we haven’t seen the same degree of variance in margins Q1 versus Q2, so maybe you can help me understand the underlying factors are for nearly 700 basis point move and why this year is different from the past?
Carlos Aguero
Well, in part it’s when we talk about the industry being erratic and unpredictable, and so we saw some of that in this quarter, suddenly one of the major factors impacting commodities, all commodities is the movement of the U.S dollar in relation to the Euro and as we said earlier in the quarter the US dollar was going up strongly, the Euro was dropping and that does impact commodity pricing throughout the world.
So, we saw that as a macro impact, but from a micro company standpoint part of it is we had a different product mix. We had a much higher sales of PGM platinum group metals, in the quarter which carry normally a lower margin than the ferrous scrap.
As we pointed out, ferrous scrap we sold approximately 19% less tons sequentially, so that impacted and finally the combination of rising inventory cost earlier in the quarter combined with dropping ferrous selling prices constricted or impacted our margins during the second quarter. So, I think it’s the confluence of all those events together taken together which account for the sequential drop in the EBITDA production.
Brent Thielman - D.A. Davidson
Okay, that’s helpful, and I appreciate your desire to not want to provide guidance, I certainly understand the markets are volatile. As you look into Q3, I mean do you anticipate an increase sequentially in ferrous volumes.
Carlos Aguero
I would certainly hope so, we believe the market is going to be better and the pricing is going to be better, so we would anticipate being able to at least meet or surpass the second quarter volumes, and hopefully we might even get to the first quarter, but its early in the quarter, it’s hard to tell, it depends how August and September go.
Brent Thielman - D.A. Davidson
Okay, I appreciate that and then I guess just lastly, I mean as you got into July, have you seen your ferrous metal margins expand?
Carlos Aguero
I would say, you are going to see that more in the latter half of the quarter rather than earlier, July was still a softer trend than we are now seeing in August and we hope and anticipate will be in September. So, we think that the quarter generally will start weak and hopefully finish strong.
Brent Thielman - D.A. Davidson
Okay, thank you.
Operator
Your next question comes from the line of Matthew Lerner from Platts. Your line is now open.
Matthew Lerner - Platts
Good morning, sir. Thanks for taking my question. In the release, it is stated that you wanted to add buying centers; you mentioned processing capacity during the call. I just wanted to be clear as to whether you wanted just one or both actually?
Carlos Aguero
Well, we really looking to source more metals in more locations, so we are actively pursuing additional buying centers in our geographic marketplace and to that and some cases we will have to add or upgrade equipment, in other cases we have adequate amount. But, certainly we do expect that in one or two particular markets which we don’t want to identify just yet, we expect to add production capacity, not just buying centers.
Buying centers, our goal is to try to add buying centers in each and every one of the markets that we currently participate in.
Matthew Lerner - Platts
If I may ask one more short question, I have recently tracked an up-tick for August in ferrous scrap prices, most people are looking at July’s down. Have you tracked an up-tick and did it catch you by surprise as a lot of my other sources have told me?
Carlos Aguero
Well, we certainly agree that July was soft and we are certainly seeing an up-tick in August. I don’t know that it necessarily caught us by surprise, we just knew it had to come, we didn’t know exactly when, but we were expecting stabilization and hopefully improvement and soon as the export market started to heat up a little bit, we started to see some of that improvement.
Matthew Lerner - Platts
Excellent, thank you very much, sir.
Carlos Aguero
You’re quite welcome.
Operator
Your next question comes from the line of Eric Prouty from Canaccord. Your line is now open.
Eric Prouty - Canaccord
Great, thanks. Guys, good job with the expense control this quarter. Is there anything that took SG&A down to an unusually low level or is it your feeling that that is a good run rate going forward?
Carlos Aguero
Yes, I think it’s more of a percentage impact base that we had increase in sales and the actual SG&A didn’t really go up, so it’s more of a phenomenon of higher sales create a lower expense ratio, better absorption.
Eric Prouty - Canaccord
Sure, but to exceed that kind of a $6.5 million absolute run rate, is that a good level to look at?
Carlos Aguero
Yes, we don’t expect any major change in the remainder of the year in the SG&A category.
Eric Prouty - Canaccord
I mean, Carlos, just back to an earlier question on the margin without going through each of the different product lines that you have, I mean would stability and pricing, was pricing kind of picking up from the end of the second quarter? Do you know more how the winds in the sail.
I mean should we expect that the gross margin or the EBITDA margin now to be on an upswing in the third quarter getting back to more kind of the normalized levels that kind of 10 plus percent that you target for?
Carlos Aguero
Well, we target that as a kind of a yearly average and we hope to achieve it every quarter, but we don’t necessarily. As you recall, in the first quarter, I think we were up over 13%, this quarter we are about 7.5%, net effect for the year so far we are like 10.2%. Our goal is certainly to try to keep it at that level or higher, that will happen if and when we are able to see the continued demand and continued, let’s say improvement in pricing.
Non-ferrous pricing has improved very nicely over the last 30 to 45 days, so that’s going to help. Certainly, ferrous scrap pricing has we have all just commented is certainly stabilized and is improving and as we pointed out in the news release and in our prepared remarks, Eric, we have ample inventories to be able to participate in this upswing in demand and pricing.
So, while again, we don’t project or predict earnings, we are certainly hopeful that the conditions that prevailed in the first half will be more prevalent now in the second half and that will help our results be comparable to what we achieved earlier.
Eric Prouty - Canaccord
Okay and then just finally on the interest expense line, any kind of backup? It sounds like you are more likely to be working down inventory than increasing inventory, so should we expect that debt levels should remain somewhat stable on that interest expense line, again in somewhat of a good run rate?
Carlos Aguero
Yes, it probably is. We certainly don’t expect it to go up and as we started to sell off inventories and generate the receivables and then turn into cash that should help bring down our revolver balances and with the lower rates of interest that we are now experiencing under a new line, that should also bring down interest expense.
So, we certainly don’t expect any surprises there. We do believe that the interest is very manageable now and that if anything it should improve slightly in the remainder of the year.
Eric Prouty - Canaccord
Great. Okay, thank you.
Carlos Aguero
You are quite welcome, Eric.
Operator
Your next question comes from the line of Bob Sullivan from Satuit Capital Management. Your line is now open.
Robert Sullivan - Satuit Capital Management
Thank you and good morning gentlemen.
Carlos Aguero
Good morning.
Robert Sullivan - Satuit Capital Management
Could you give me a sense for, if you can at all the, I guess, maybe inventory levels of your customer base and I think what I am trying to get at is a better understanding of some of the your shipments to your customers and has it been for re-stocking of their inventory levels, has it been for end production, and is there going to be a real true up-tick in demand in the second half of this year, and if you could provide some kind of a sense for that?
And I am also curious as to kind of a follow-up to Brent, a question about where your answer to these start weak, finish strong, if you have. Some kind of data points that you are looking at to see a stronger finish in the quarter, I’ve got a sense that the August up-tick in pricing certainly helps, but are there some other data points you are going to look at to see that reflection point in the strength of pricing and strength of demand going forward?
Carlos Aguero
Well, let me start by answering that. It’s hard for us to – we sell to a lot of different consumers and we don’t always have inside into what the status of their internal inventories or what their order books look like. So, it would be speculation on our part to try to tell you what we think they are doing, that we are really not the right place to get that.
We can tell you what we are doing, what we are seeing and that is that since I guess the beginning of July we have noticed non-ferrous pricing of copper, nickel, aluminum have all firmed. Copper has had a nice move and continues to be strong, so if we look at our numbers you realize that we handle quite a bit of non-ferrous metals, probably more than 50/50 from a standpoint of ferrous versus non-ferrous. We are more heavily weighed to non-ferrous.
We do have, as we said adequate inventories and pricing has improved and appears to be strong, and we believe that as long as the dollar remains in the present downward trend that and consumers are certainly demanding more scrap for their production that, that should bode well for the company and for the industry.
So, that’s what we can say and on the ferrous side, no question that the August up-tick has helped. We are certainly working to sell as much material as we can place, properly place into consumers in both August and September and that should hopefully provide some better results.
The area that we do see a little bit of some volume decrease is on the PGM side. There seems to be again a little bit of holding back or hoarding by suppliers. Suppliers often times tend to speculate somewhat in themselves in holding material until they get a target price, to achieve a target price.
So, we are seeing some of that. So, unless pricing for PGM continues to improve, the supply will be constrained because suppliers will hold on to it waiting for that higher price. There are a lot of different components that go into this and it’s hard to know how each of them is going to go behave so.
But, at this point, we feel pretty good about where we are with our inventories, where the pricing for commodities are and where things seem to be going in the third quarter and hopefully in the remainder of the year.
Robert Sullivan - Satuit Capital Management
Great, that’s helpful. Thank you.
Carlos Aguero
You’re quite welcome.
Operator
Your next question comes from the line of Chris Olin from Cleveland Research. Your line is now open.
Chris Olin from Cleveland Research
I understand your comments regarding billing inventories in the second quarter to meet third quarter demand, but I want to make sure I’m clear on the overall flows. Are you seeing any changes there, are there any concerns that you could see a tightness in the channel because the demand is exceeding the level of flow right now?
Carlos Aguero
Well, we saw a tremendous seasonal upswing in volumes coming into our yards in late March, April and probably into mid May. And then as the warm weather hit and folks have basically cleared out a lot of what they needed to from the winter month, we started to see a reduction in what people are bringing in because of the pricing, as the price of metals was down, folks weren’t collecting as much or bringing as much to the yard.
So, we definitely did see somewhat of a drop off in the latter part of the quarter in terms of our inbound volumes, but nothing of huge significance. As we have said a couple times before have ample inventories to put up for sale for this coming quarter. The supply is adequate, more than adequate, for our needs and our anticipated sales. So we don’t think that we are going to face a shortage ourselves right now.
It’s not to say that scrap is everywhere, but we are getting our fare share and we don’t project any problems with supply in the quarter.
Chris Olin – Cleveland Research
Would you care to estimate how much the supply has decreased since that stronger period of flow in the first, second quarter?
Carlos Aguero
No, frankly I don’t have those numbers in front of me, I’d have to did them out, otherwise I would just be guessing, but from a general macro trend I think you will hear people say that it’s in the kind of a 15% to 25% and lot of that is impacted by pricing, not to describe necessarily isn’t there, but just that it may not be flowing because the suppliers don’t like the price.
So, it’s a funny thing that as soon as the pricing starts to come up, you start to see more flow. So it’s a very direct relationship between the price of what suppliers get for scrap and how much they bring in.
Chris Olin – Cleveland Research
Is there any specific product that might be in tighter supply versus others?
Carlos Aguero
Some of the aluminum grades, some of the mill grades on the aluminum side are on pretty tight supply and certainly some of the higher grade values of ferrous scrap are in tight supply. Some of the bushling grades and the [plating] structural grades, those tend to be in tighter supply than let’s say shred.
Shred seems to be the one that’s in most ample supply being that there is -- I think at last count there was 280 some odd shredders in the US, so there is a lot of shred being produced, probably more than is currently demanded and we believe that there has been an overhang of shred in the marketplace, that some of it has gone overseas, some of it has been placed and it’s beginning to come back into a better balance. So, those are the areas that we see a little bit of slacking.
Chris Olin – Cleveland Research
Okay, and then just lastly on your comments in terms of better export demand. I’m just wondering specifically have we seen big changes from the Chinese steel mills over the past 30 days.
Carlos Aguero
Well, I am not sure where all the demand is coming from, whether it’s Turkey, China, Korea, Taiwan, but a lot of what the ships from the East Coast tends to go places like Turkey, and I am sure some goes to China, but I can’t tell you specifically whether it’s China that’s driving it or it’s some of the other markets.
I think it’s more from a macro standpoint, it’s more the economic recovery in some parts of the world is faster than others and also the currency flows have a big impact on things and early in the year there was a lot of export buying, I guess they have now consumed a lot of that export that they bought and they seem to be coming back in the market timed when it’s more favorable for them to buy when our currency is certainly dropping.
Chris Olin – Cleveland Research
I appreciate your information, thank you.
Carlos Aguero
You are welcome.
Operator
Your next question comes from the line of Gregory Macosko from Lord Abbett. Your line is now open.
Gregory Macosko - Lord Abbett
Yes, thank you. Perhaps to get a follow-up on the export side of things, I’m assuming that you are not directly exporting, but can you give us a sense from kind of your customers, I mean how directly, I mean if we see a rise in demand on East Coast say for exports, how quickly does that pass through to volumes to you would you say?
Carlos Aguero
Well, there is a functional price. The demand for export has been steadily growing over the last, I would call it, the last 30 to 60 days, but it’s not until very recently that the price has gone up sufficiently for folks in that part, and the Midwest to want to ship that material to the east, because there is a significant freight component.
So, it’s not just that there is a demand, there has to be a demand met by adequate price that companies like ours where we will be willing to divert material away from our domestic consumer and send it to an exporter. Just very recently we think that the prices have gone to the point where you are going to see more of that Midwestern scrap flowing into the ports on the East Coast.
But, the demand has definitely been growing and exporters have been gradually increasing their price to the point that they are now beginning to get, I believe what they need to ship.
Gregory Macosko - Lord Abbett
Are you actually exporting or selling to…?
Carlos Aguero
We sell to exporters. We ship primarily by rail to exporters in either Port of Elizabeth or further up North and New England Port, but we do not ourselves go direct export, but certainly through some of the bigger international companies that are out there.
Gregory Macosko - Lord Abbett
Okay. And then with regard to the inventory, you are saying that you have a lot of inventory and you are ready for you know demand can meet that and you bought quite a -- I guess you bought quite a bit in March. Could you give us a sense of the cost of your inventory and your earlier comments about the profitability, I am assuming that there is some higher cost inventory that is in place now and that how long until that kind of flows through and gets down to something closer to the current price?
Carlos Aguero
Well, we certainly believe that we are going to flow quite a bit through this quarter, but just again to recap some of the things we said. Early in the second quarter, primarily in the month of April, prices on the buy-side, the flow was very brisk and the competitor forces were great, so people were paying up for scrap during that period.
In the latter part of the quarter, mainly May and June, prices dropped off. We continued to buy as much as we could at the lower price levels thereby lowering our average inventory costs from what was a higher cost in April. So, everything we bought in the first month of the quarter was higher than everything we bought in the latter two months of the quarter, so that helps to bring down the overall average cost.
We don’t comment on what our carrying cost on the inventory, but I can tell you that the average inventory costs have been steadily dropping, and dropped into July as we continued to buy cheaper scrap.
Gregory Macosko - Lord Abbett
Okay, and is that the case as well for PGM or not?
Carlos Aguero
Well, PGM is a little bit different situation because it’s more real time, you are buying it and selling it almost simultaneously. So you are keeping very little inventory, you are only keeping two to three weeks of inventory to process and that inventory has already sold and priced, so it’s just a matter of getting it processed and shipped.
It isn’t a matter of holding and then waiting to sell it. So, actually it’s a slightly different business model than with the ferrous and non-ferrous where you buy it and don’t always necessarily have taken orders already for the material that you have on hand.
Gregory Macosko - Lord Abbett
Good, and so that you have been able to maintain it through the quarter?
Carlos Aguero
Right.
Gregory Macosko - Lord Abbett
Okay. Thank you very much.
Carlos Aguero
You are welcome.
Operator
Your next question comes from the line of Scott Huntington from Bodell Overcash. Your line is now open.
Scott Huntington - Bodell Overcash
Good morning, everyone.
Carlos Aguero
Good morning.
Scott Huntington - Bodell Overcash
You could all say its kind of a generic question, we are all aware that you have been a very, very successful so called [Inaudible] here. We wondered a little bit, I know all these deals are structured differently with competes and non-competes, all those kind of things. But we see an awful lot of scrap yards popping up around and I’m just wondering if you could expand a little bit on your retainage of customer base once you assume control -- average retainage of customer base once you assume control of a given scrap operation?
Carlos Aguero
Yes, we are in a very competitive industry and the supplier, the customer has loyalty to one thing and that is to price. So, it is a very price competitive industry, you can have suppliers that have been around for a long time and often times if you don’t meet a match or price someone else is paying, you might temporarily lose them until you are prepared to adjust your price.
So, there is an urban flow constantly in a marketplace where you have a supplier for a period of time and somebody out ups the price of what they are willing to pay for that scrap and will take him away from you for awhile and then market conditions change and you are able to pay more and you’ll get him back.
So, retention is a tough end to speak about except for the industrial side of the business, which I can tell you that we have very good retention on that, but the non-industrial side, lot of your obsolete grades is much more a function of the price than anything else.
But, I can just generally say that our retention on industrial accounts has been quite good over time, and we expect that to continue and I think one of the reasons for that is the importance of maintaining the same operating management personnel, usually ex-owners and other key employees that have been with the company all along, that helps maintain the relationships with your industrial business and to some degree with your obsolete suppliers.
It is a relationship-based business and you have to constantly be able to work on those relationships and maintain those, so that you can keep suppliers, but at the end of the day if someone else is paying a significantly higher price, that supplier might likely say to you I’ll see you, I’ll see you when your price comes up.
Scott Huntington - Bodell Overcash
Thank you very much.
Carlos Aguero
You are welcome.
Operator
(Operator Instructions) Your next question comes from the line of Brent Thielman from D.A. Davidson. Your line is now open.
Brent Thielman - D.A. Davidson
Hi, thanks for taking one more from me. Regarding the lead segment, I don’t think we talked about that yet. I mean are you anticipating further losses here in the second half? What sort of do you need to see to get you back into the block there, and then maybe just an update on sort of your longer term strategy overall for that segment be it for a new product focus, etc…
Carlos Aguero
Well, the segment is not necessarily growing and is particularly weak now because of the overall economy. The point of our strategy is certainly kind of last man standing, a lot folks around us don’t have the wherewithal, don’t have the diversity or the equipment or the let’s say capability that we do, so expect us to be around and to be in the business for quite awhile. We certainly expect that the second half of the year in the lead segment should outperform the first half and it should be profitable.
Certainly, we are in a good situation there in terms of some pricing power in some areas and some areas of our product and we have good inventory price levels. And recently with the rise in the general aluminum prices, the aluminum metal exchange price for lead that will just augment a little bit what we can get for the finished product. So, the short answer is we expect better results in the second half than the first.
Brent Thielman - D.A. Davidson
Okay. Do you expect second half volumes to outperform first half volumes?
Carlos Aguero
Hard to say, not necessarily. I think we are more focused on margin and not necessarily volume.
Michael Drury
Hi Brent, this is Mike Drury. Typically, the second half of the year you see lower shots and ammunition-related sales in the first half of the year, so that’s an historical norm that we expect will follow through this year.
Brent Thielman - D.A. Davidson
Okay. That’s what I thought. Okay, thank you very much.
Carlos Aguero
You are welcome.
Operator
Your next question comes from the line of Matthew Lerner – Platts. Your line is now open.
Matthew Lerner - Platts
Good morning again gentlemen and thank you. It seems Metalico has been pretty consistent in that 32% to 34% service range. With the selling opportunities you described, the higher prices and ample inventory, might that number creep up and might the acquisitions touch that number?
Carlos Aguero
Yes and yes.
Matthew Lerner - Platts
Okay.
Carlos Aguero
That number might very well because we do have ample inventories and as we commented PGM volumes are off because people are hoarding or holding. The thing that might impact us somewhat is; we also expect increased non-ferrous sales, so that’s certainly going to affect the percentage one way the other, but generally speaking we would expect higher volume at a higher price for the coming period.
Matthew Lerner - Platts
Thank you, again.
Operator
Your next question comes from the line of Gregory Macosko from Lord Abbett. Your line is now open.
Gregory Macosko - Lord Abbett
Yes. I may have missed it earlier in the call. I’m sorry to go over it again, but you mentioned the four to five new buying centers, could you give us an idea, are those basically aligned closely with the existing shredding and other operations, or what kind of investment is expected there and what the expected -- how do you expect it to just affect your cost structure, particularly regarding transport?
Carlos Aguero
Well, first of all we’d like to open more, open or buy more centers closely adjacent to our existing platform operations, so that transport is not a huge item. These centers generally are the lowest price point for sourcing or buying scrap, so it’s intended to actually help you lower your costs and increase your volume, shouldn’t necessarily be an increase in your cost.
The centers vary what it costs to open whether you are trying to do something, Greenfield or buying someone else’s existing underutilized operation and basing it up, but it can vary anywhere from $100,000 investment to as much as a million dollar investment depending on the market, the size, the condition of the property, what the expectation for volume is at the location and how much equipment you will need to put together there.
So, it really does run across the board between that $100,000 to a million of cost, of initial upfront capital cost.
Gregory Macosko - Lord Abbett
When do you expect those to be in place?
Carlos Aguero
Well, we are working on several of them as we speak, it’s hard to predict when we will be able to have any one of them, but certainly by the end of the year we expect some of those to be coming online, and some of them may come online simultaneous to others. I would certainly say that some this quarter and certainly maybe a couple more at the end of the year.
Gregory Macosko - Lord Abbett
Thank you.
Operator
(Operator Instructions) There are no further questions at this time; I’ll turn the call back over to the presenter.
Carlos Aguero
Okay. Normally what we do at this time, we wait 60 seconds or so and we see if there are any other final questions, and if not then we complete the call. So, why don’t we just give it that 60-second time.
Operator
(Operator Instructions)
Carlos Aguero
Operator, do you have any other one.
Operator
There are no further questions.
Carlos Aguero
Okay. Well let’s just conclude the call then. I just want to thank everyone for joining us today and for your interests in Metalico. We look forward to speaking with you once again when we present our results for the third quarter, which we expect to do in early November. Everyone have a wonderful day and thanks for your participation.
Operator
This concludes today’s conference call, you may now disconnect.
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Metalico, Inc. Q2 2010 Earnings Call Transcript
http://seekingalpha.com/article/219331-metalico-inc-q2-2010-earnings-call-transcript?source=yahoo
Metalico, Inc. (MEA) Q2 2010 Earnings Call August 05, 2010 10:00 am ET
Operator
Good morning, my name is Melissa and I will be your conference facilitator. At this time, I would like to welcome everyone to the Metalico 2010 second quarter results call. (Operator Instructions) The purpose of today's call is to discuss the results of the company's operations for the quarter ended June 30, 2010.
Earlier today, Metalico issued a press release announcing second quarter results and filed a report on Form 8-K in connection with the release. The company is scheduled to file its quarterly report on From 10-Q for the quarter shortly. You can access copies of Metalico's filings through the SEC at their online files or directly through the company's website at www.metalico.com.
Just log on to the website, click on Investors at the top of the home page and then click on SEC filings in the left column, then click to download the report. Metalico's filings are also available at the SEC's website at www.sec.gov.
In addition, an audio replay of the call will also be available at 800-642-1687 or 706-645-9291 for the first week after the call's conclusion. To access the recording, callers will be required to enter the conference identification number of 889-706-53.
As it is customary, let me reiterate the Safe Harbor statement under the Private Securities Litigation Reform Act of 1995. The following discussion contains forward-looking statements that are subject to risks and uncertainties, including those risks set forth in Metalico's filings with the SEC. These risks could cause actual results for the current period and beyond to differ materially from those expressed in any forward-looking statements made by or on behalf of the company.
We refer you to Metalico's periodic reports that are filed from time to time with the SEC. For a more detailed discussion of forward-looking statements and a discussion of the factors that could cause results to differ materially from the discussion’s today, please refer to the risk factor discussion in Metalico's annual report on Form 10-K for 2009, which is also available online.
In addition, during the course of the conference call, certain non-GAAP financial measures may be described which should be considered in addition to and not in lieu of comparable GAAP financial measures. The company has provided reconciliations of these non-GAAP measures to what it believes are the most directly comparable GAAP measures in the earnings release.
Thank you, ladies and gentlemen. I would now like to turn the call over to Mr. Carlos Aguero, President and Chief Executive Officer of Metalico.
Carlos Aguero
Carlos Aguero
Good morning and thank you for joining our call. With me here today are Michael Drury, our Executive Vice President and Eric Finlayson, our Senior Vice President and Chief Financial Officer. Following my presentation, we will be available to answer any questions you might have.
We will also post a transcript of our remarks and the question-and-answer session on the Metalico website when the transcript becomes available after the call. Earlier today, Metalico released financial results for the second quarter of 2010 showing improvements in revenue, operating income, net income and EBITDA as compared to same period in 2009. At the same time, on a sequential basis sales and net income improved, but several key measures of operating performance declined in comparison. We view this as the results of an acceptable quarter suffering by comparison to an outstanding first period result.
Now let’s go over some of the highlights. Second quarter financial highlights include the following, all as compared to the second quarter of 2009. Sales increased to a $144.6 million, an increase of $82.3 million or 132% over the $62 million of last year. Operating income was $6.7 million compared to operating income of $2.8, an increase of $3.9 or 139%.
Net income increased to $4.4 million, tripling from net income of $1.1. EBITDA rose to $10.7 million, an increase of $4.3 or 67% over the $6.4 million last year. Net income of $0.10 per diluted share compared to net income of $0.03 per share. Unit volume shift increased by 40% for ferrous scrap and 77% for non-ferrous scrap.
PGM unit volumes increased 165% to a total of 39,042 troy ounces from 14,690 troy ounces. Lead product shipments were down 33% from Q2 of ‘09 related primarily to unusually high ammunition product related sales in ‘09.
Excluding corporate overhead charges, the company’s scrap segment saw operating income more than triple to $8.8 million from $2.7 million. While the Lead Fabricating segment showed an operating loss of $100,000 compared to an operating income of $1.6 million in the second quarter of ‘09.
Compared sequentially with the first quarter of 2010, sales and net income improved, but operating income and EBITDA were lower. Sales increased to $144.6 million, an increase of $10.5 million or 8% over the $134.1 million posted in the first quarter. Operating income was $6.7 million compared to $13.6 million, a decrease of $6.9 or 51%.
Net income increased to $4.4 million, a 26% improvement from net income of $3.5 million. EBITDA decreased to $10.7, a decrease of $6.9 million or 39% versus $17.6 million. Net income of $0.10 per share compared to net income of $0.08 per share. Unit volumes shipped decreased by 19% for ferrous scrap and remain virtually flat for non-ferrous scrap. PGM unit volumes increased 9% to 39,042 troy ounces from 35,704 troy ounces shipped in the first quarter. And finally, lead product shipments were up 32% sequentially from Q1 of 2010.
Although second quarter results have now reached the levels we wanted, Metalico still had a stellar first half of the year. Let me just briefly recap this for you. Sales of $279 million was more than double last year’s first half total of $115. Operating income of $20.4 million was almost seven times better than the $3 million posted last year.
We posted net income of almost $8 million compared to $2.5 million loss last year. Earnings per share were a positive $0.17 after a $0.04 net after-tax charge for finance cost, as compared to last year where we had a loss of $0.07 per share. Compared to last year first half, interest expenses has decreased by $3.5 million while total debt decreased by $20 million since last June, meaning we have greatly reduced borrowing costs and our leverage.
From a year ago, Metalico’s networking capital has increased by almost $20 million to $93 million. Additionally, as of today, availability on our revolver stands at approximately $25 million which more than adequately accommodates anticipated capital needs for the remainder of the year. Capital expenditure for the second quarter totaled $2.5 million, an increase from $1.1 million in the first quarter of 2010. We expended $2.4 million for scrap metal recycling segment and a $120,000 for the lead segment. The purchases were primarily for scrap handling equipment, trucks and replacement containers.
As of June 30, Metalico had approximately $46.4 million common shares issued and outstanding and no preferred stock outstanding. Let’s break down the quarter starting with scrap metal first. Scrap segment generated sales of $126.4 million, more than two and a half times to $44.3 posted in the second quarter of 2009.
We derived 32% of our scrap revenue in the quarter from ferrous and 68% from all non-ferrous metal. Operating profit for the scrap segment before corporate overhead rose to $8.8 million compared to $2.7 million in the same quarter last year. We realized a 91% increase in our first average sales price to $392 per gross tone this quarter up by $187 compared to the average that was posted last year of $205 per gross ton, and a $35 per gross ton sequential rise from $357 in the first quarter of 2010.
In April, selling prices for ferrous scrap metal increased and domestic demand remained firm while scrap buying prices and volume rose steadily. The remainder of the quarter was marked by steadily declining ferrous selling prices with some grades of scrap in surplus along with lackluster demand from many consumers.
Metalico’s average inventory cost rose during the period and the company filled 19% less scrap as compared to the first quarter. Non-ferrous markets were impacted by price volatility brought on by concerns over Europe’s sovereign debt issues and banking concerns. The average selling price for non-ferrous scrap in the quarter was a $1.11 per pound compared to $0.83 per pound in the prior year quarter and a $1.05 in the first quarter of this year.
In our last quarterly update, we explained the change in how we report PGM units converting all reported volumes to troy ounces instead of pounds of substrate consistent with industry standards. PGM prices in the second quarter were much higher than a year ago reflecting increased precious metal investment demand and automobile production, and its impact on PGM prices. We realized an average PGM selling price of $1122 per troy ounce compared to last year’s $661 per ounce and this year’s prior quarter selling price of $966 per ounce.
Metalico’s volume of metal sold for the second quarter included $103,200 gross tons of ferrous scrap, that’s a 40% increase over the $73,700 tons sold in Q2 of 2009, but it is a 19% decrease sequentially. We shipped 36.1 million pounds of non-ferrous metal in the quarter, another significant year over-year-increase of 77% from the 20.4 million pounds over a year ago and a small increase of this year’s first quarter.
Aluminum, stainless steel and nickel-based alloys as well as copper, brass and molybdenum continue to be the primary contributors to our non-PGM volumes of non-ferrous scrap metal sold. The 39,000 troy ounces of PGM sold in the quarter was two and a half times more than last year’s 14,690 troy ounces and 9% higher than the first quarter 2010 shipment.
Let’s move on now to the Lead Fabricating segment. In this year second quarter, we generated sales of $18.2 million compared to same period sales of $18 million in ‘09. We generated an operating loss before corporate overhead of approximately $99,000 compared to operating income of $1.6 million for the second quarter last year.
The lead segment continues to be impacted by competitive pressures and weak demand in many of the markets the company sells to. Segments of the economy such as commercial construction including medical facilities, diagnostic and therapy equipment manufacturers, plumbing supply, lead anode consumers, all remain impacted by the continuing economic softness. However, shot sales, seasonal roof flashings and department of defense sales remain robust.
The lead segment realized an average selling price of a $1.42 per pound in the quarter compared to $0.94 per pound in the second quarter of 2009 and a $1.46 in this year’s first quarter. Volumes rose by 32% sequentially to 12.8 million pounds, but were lower year-over-year due to last year’s strong market for ammunition-related products when we sold 19.1 million pounds in the second quarter.
The second quarter results like those of the first quarter demonstrate that our efforts to reduce an interest expense, to control operating cost and focus on profits over volume enabled the company to post strong results even in the sluggish economy.
We remain optimistic about our performance even in the absence of a strong recovery. During the quarter, our 700 employees performed their jobs professionally, efficiently and safely and as always we want to express our appreciation to employees at all levels of the company for their significant contribution.
Now, a word on guidance and forward-looking statements; Metalico’s practice like many others in our industry is not to provide guidance on earnings or earnings estimates. The scrap recycling industry is highly cyclical and commodity metal markets are often very erratic. We believe that earnings estimates could be unreliable because of the unpredictability, duration and magnitude of commodity pricing.
Having said that, let’s now go through our second quarter recap and third quarter outlook. Going into the third quarter, we believe the domestic scrap prices have stabilized and demand is once again supported by the export market. The short-term strength of the dollar in the second quarter helped drive many ferrous export consumers from the US market.
Now that the dollar has weakened, the export buyers are returning providing competition to domestic metals for available ferrous scrap. By an event that once again drives capital a dollar as a safe haven, we expect a weaker dollar will support a much more active export market.
Metalico views the second quarter low as a buying opportunity and is well positioned with ample inventories to participate in the anticipated improvement in the ferrous market. Demand for non-ferrous scrap continues to be strong, but pricing for most grades declined modestly throughout the quarter in part due to the strength in the US dollar and weakness in the Euro. The flow of non-ferrous scrap into yards have slowed down somewhat from the brisk pace of early to middle spring, but is expected to improve as long as non-ferrous metal pricing maintains its recent improvements.
Domestic, non-ferrous consumers appear to have strong order books, which should help support prices and keep scrap in high demand and export market consumers are recently more active in buying scrap once again as supported by a weaker dollar. Demand for aluminum de-ox has slowed. Selling prices have declined in tandem with the London Metal Exchange and a drop in steel industry capacity utilization. But recently de-ox selling prices have been stabilizing, but at lower levels than they were earlier this year.
During the second quarter, we experienced a significant improvement in PGM troy ounces recycled. This was driven by aggressive buying complemented by strong metal selling prices in the early part of the quarter and resulted in great performance for this part of our business. Average prices for PGM declined approximately 10% in the latter part of the quarter resulting in reduced supply of catalysts. Barring non-market pricing disruption, we believe that PGM prices will continue to recover during the remainder of 2010, which will help drive the supply of catalysts into the market place.
As mentioned earlier, the lead segments have been impacted by sluggish industrial demand, which increased competitive pressures. That is, the industry has a same production capacity chasing reduced demand across a broad array of industries. We continue to market our products aggressively so as not to lose market share. We are investing our productivity improvement and are taking steps to position ourselves in new markets that we have not previously serviced.
As we stated before, our goal is to continue to be a leading participant in the secondary commodity metal businesses and the complementary niche businesses in which we operate. We are focused on increasing operating density within our existing geographic markets and we will further leverage our existing platforms by proactive sourcing and internalizing scrap flows. We are investing in complimentary scrap processing capacity edition as well as expansions and tuck-in acquisition where and when they might become available.
Finally, we look ahead to the second half optimistic that the market condition that prevailed early in the year will again be present and help drive the economy, our industry and particularly our company to achieve the results that we all want.
This concludes our prepared remarks and with that, operator, I would like to open up the call for any questions we might have.
Continue to Q&A »
It premiered on Youtube a couple of days ago:
Thanks, but mods can't ban anyone. That's admin's job. I have already requested they confirm his human status. I suspect (from his earliest posts) that a real person monitors the return mail. If he wants to post here everyday and is otherwise compliant with tos, he is free to do so. I suspect this poster has already been brought to the admin's attention.
There is an ignore button here too!
gl
Yep...bad robot,imo.
We already knew that.
Go tell it on the mountains.
This is the choir loft.
GL
As soon as a hearing is held and the hearing officer renders a decision, the Company will provide a further update.
http://ih.advfn.com/p.php?pid=nmona&article=43718928&symbol=NB^JBIIE
Strong out of the gate this morning too...
InPlay: Metalico misses by $0.02, beats on revs (MEA) 4.37 : Reports Q2 (Jun) earnings of $0.10 per share, $0.02 worse than the Thomson Reuters consensus of $0.12; revenues rose 131.7% year/year to $144.6 mln vs the $122.6 mln consensus. Co stated that "it believed that, going into the third quarter, domestic ferrous scrap prices have reached a plateau and demand is somewhat more stable. Metalico expects prices and demand to strengthen over the period. While intake of ferrous scrap at its yards has been below expectations since May, Metalico used the second quarter lull as a buying opportunity and is well positioned with ample inventories to participate in the anticipated improvement in the ferrous markets and stronger pricing for non-ferrous commodities."
http://finance.yahoo.com/marketupdate/inplay#mea
Metalico Reports Continued Improvement in Second Quarter
Metalico, Inc. (NYSE Amex: MEA) today reported net income of $4.4 million and earnings of $0.10 per share for the quarter ended June 30, 2010, with continued increases in volume, revenues, and operating income compared to the prior-year quarter.
Sales were $144.6 million, an increase of $82.3 million, or 132%, over same-quarter 2009 results. Operating income for the 2010 second quarter was $6.7 million, compared to $2.8 million for the prior-year quarter. EBITDA (as defined below) increased by 67% to $10.7 million from $6.4 million for the same quarter in 2009.
Second quarter 2010 results include a non-cash fair value benefit for financial instruments of $2.1 million or $.04 per share compared with a $1.5 million expense or ($.04) per share in the prior year quarter.
Sequential Quarter Comparison
Compared sequentially with the first quarter of 2010, sales and net income improved but several measures of operating performance declined.
-- Sales of $144.6 million increased by $10.5 million, or 8%, over $134.1
million.
-- Net income was $4.4 million, compared to net income of $3.5 million.
-- On a per-diluted-share basis, net income rose to $0.10, compared to
$0.08 per share.
-- Operating income was $6.7 million, a decrease of $6.9 million, or 51%,
from $13.6 million.
-- EBITDA was $10.7 million, a decrease of $6.9 million from $17.6
million.
-- Unit volumes shipped decreased by 19% for ferrous scrap and remained
flat for non-ferrous scrap.
-- Platinum Group Metal ("PGM") unit volumes were up by 9%.
-- Lead product shipments in the quarter rose by 32%.
The Company said its higher sales were largely driven by strong operating results from its PGM business.
Prior Year's Second Quarter Comparison
Year-over-year comparison to the second quarter of 2010 reflects substantially improved operating performance:
-- Sales increased to $144.6 million, an increase of $82.3 million, or
132%, over $62.3 million.
-- Operating income was $6.7 million, compared to operating income of $2.8
million, an increase of $3.9 million, or 139%.
-- Net income increased to $4.4 million, a 300% improvement from net
income of $1.1 million.
-- EBITDA rose to $10.7 million, an increase of $4.3 million, or 67% over
$6.4 million.
-- Net income of $0.10 per diluted share, compared to net income of $0.03
per share.
-- Unit volumes shipped increased by 40% for ferrous scrap and 77% for
non-ferrous scrap.
-- PGM unit volumes increased 165% to 39,042 troy ounces from 14,690 troy
ounces.
-- Lead product shipments were down 33% from Q2 2009 related primarily to
unusually high ammunition product-related sales in 2009.
Excluding corporate overhead charges, the Company's Scrap Metal segment reported $8.8 million in operating income in the 2010 second quarter compared to $2.7 million for the same period last year. The Company's Lead Fabrication segment reported an operating loss of $99,000 compared to operating income of $1.6 million in the prior-year period, also excluding corporate overhead charges.
Volume and Price Comparisons
Metalico's Scrap Metal segment experienced substantial year-over-year unit volume increases. Sequential quarterly volumes increased for PGM and non-ferrous, and fell for ferrous. Volumes in the Lead Fabricating segment rose sequentially, but were lower year-over-year due to 2009's strong market for ammunition-related products.
Quarterly volume of units sold
Q2 2010 Q2 2010
Q2 2010 Q1 2010 Change Q2 2009 Change
---------- ---------- --------- ---------- ---------
Ferrous (gross
tons) 103,200 127,100 -19% 73,700 40%
Non-Ferrous
(pounds) 36,102,000 36,013,000 0% 20,364,000 77%
PGM (troy ounces) 39,042 35,704 9% 14,690 165%
Lead (pounds) 12,845,000 9,752,000 32% 19,080,000 -33%
Average selling prices increased for all metals, both sequentially and year-over-year, with the exception of a 3% decline in sequential selling prices for lead products.
Quarterly selling price per unit sold
Q2 2010 Q2 2010
Q2 2010 Q1 2010 Change Q2 2009 Change
---------- ---------- --------- ---------- ---------
Ferrous (gross
ton) $ 392 $ 357 10% $ 205 91%
Non-Ferrous
(pound) $ 1.11 $ 1.05 6% $ 0.83 34%
PGM (troy ounce) $ 1,122 $ 966 16% $ 661 70%
Lead (pound) $ 1.42 $ 1.46 -3% $ 0.94 51%
Carlos E. Agüero, Metalico's President and Chief Executive Officer, said, "The second quarter when compared to 2009 showed significant improvement but was below the excellent performance posted in the first quarter of this year. The quarter was characterized by rising inventory purchase costs early in the period while selling prices for many ferrous and non-ferrous commodities steadily dropped in May and June, thereby squeezing metal margins. Operations generated EBITDA margins of 7.4%, which is less than our target of 10%. However, through the first six months of 2010, EBITDA margins were 10.2%.
"We anticipate market conditions will remain choppy for the remainder of the year as domestic consumers grapple with erratic order books and foreign consumers who enter the U.S. only when they see opportunistic buying conditions. Non-ferrous markets were impacted by price volatility brought on by concerns over Europe's sovereign debt issues and banking concerns. We are concerned that similar issues and concerns over domestic issues will roil the commodity markets for the foreseeable future."
He added, "As we said earlier this year, we expect to enhance the operating leverage of our existing platforms by opening or acquiring additional scrap metal buying centers in strategic adjacent areas that will provide additional market penetration. Our goal is to add four or five such new buying centers over the next twelve months, all subject to finding, securing and permitting such properties to accept scrap metals."
Shareholders' Equity and Debt
Metalico's outstanding debt remained flat at approximately $127 million as of June 30, 2010 compared to March 31, 2010, but net working capital improved by approximately $3.8 million. Shareholders' equity increased by $5.2 million to $160.1 million as of the end of the second quarter from $154.9 million as of the prior quarter-end.
As of June 30, 2010, Metalico had 46,449,085 common shares issued and outstanding. The Company has no outstanding preferred stock.
Metalico operates in the highly volatile and cyclical commodity metals industry and therefore deems it unreliable to provide earnings guidance. The Company's core business strategy emphasizes balanced growth of the ferrous and non-ferrous Scrap Metal Recycling business through acquisitions or new facility development in existing and contiguous new markets.
Outlook and Update
In April of 2010, selling prices for ferrous scrap metal increased and domestic demand remained firm while scrap buying prices continued to rise. The remainder of the quarter was marked by steadily declining ferrous selling prices with some grades of scrap in surplus, along with lackluster demand from many consumers. Metalico's average inventory cost rose during the period and the Company sold 19% less scrap as compared to first quarter.
The Company believes that, going into the third quarter, domestic ferrous scrap prices have reached a plateau and demand is somewhat more stable. Metalico expects prices and demand to strengthen over the period. While intake of ferrous scrap at its yards has been below expectations since May, Metalico used the second quarter lull as a buying opportunity and is well positioned with ample inventories to participate in the anticipated improvement in the ferrous markets and stronger pricing for non-ferrous commodities.
Demand for non-ferrous scrap continues to be strong, but pricing for most grades declined modestly through the quarter in part due to strength in the US Dollar and weakness in the Euro. The flow of non-ferrous scrap into yards slowed down somewhat from the brisk pace of early to middle Spring but is expected to improve as long as non-ferrous metal pricing holds during the third quarter. Non-ferrous consumers appear to have strong order books, which should help support prices and keep scrap supplies tight.
Demand for aluminum de-ox has slowed. Selling prices have declined in tandem with quotations on the LME and a drop in steel industry capacity utilization.
During the second quarter Metalico experienced a 9% improvement in PGM troy ounces recycled. This increase was driven by aggressive buying complemented by strong metal selling prices in the early part of the quarter, and resulted in superior performance for this part of the Company's business.
After starting out strong early in the quarter, average prices for PGM's fell approximately 10% in the latter part of the quarter, resulting in a declining supply of catalyst. Barring non-market pricing disruptions, Metalico believes that PGM prices have started to rebound and will continue to recover during the remainder of 2010, which will help drive the supply of catalyst into the market place.
The Company's lead segment continues to be impacted by competitive pressures and weak demand in many of the markets Metalico sells to. Segments of the economy such as commercial construction including medical facilities, diagnostic and therapy equipment manufacturers, plumbing supply and lead anode consumers remain deeply impacted by the continuing economic softness.
However, the Company said that shot sales, seasonal roof flashings and Department of Defense sales remain robust.
About Metalico
Metalico, Inc. is a holding company with operations in two principal business segments: ferrous and non-ferrous scrap metal recycling, and fabrication of lead-based products. The Company operates twenty-four recycling facilities in New York, Pennsylvania, Ohio, West Virginia, New Jersey, Texas, and Mississippi and four lead fabricating plants in Alabama, Illinois, and California. Metalico's common stock is traded on the NYSE Amex under the symbol MEA.
Contact:
Metalico, Inc.
Carlos E. Agüero
Michael J. Drury
Email Contact
186 North Avenue East
Cranford, NJ 07016
(908) 497-9610
Fax: (908) 497-1097
www.metalico.com
Yep, nice day for those WNR calls too!
Those X calls are looking really nice today, kudos!
Yep, saw that too...
Nope, just on paper with the options so far...watching closely, though!
Bobby, Nice call on WNR, you in the money now bro!
Kudos!
MEA...bully bully
link back for chart
I think they did that just to impress their FINRA hearing officer.
Metalico Sets August 5 Call for Second Quarter Results
Metalico, Inc. (NYSE Amex: MEA) a scrap metal recycler and lead products fabricator, will host a conference call on Thursday, August 5, 2010 at 10:00 a.m. Eastern time to discuss its earnings results for the quarter ended June 30, 2010 and to provide an update on business developments. The Company is scheduled to release its Second Quarter results earlier that day.
http://ih.advfn.com/p.php?pid=nmona&article=43700562&symbol=mea
Free L2 is already available for JBIIE as an otcqb, fwiw.
http://www.otcmarkets.com/stock/jbiie/quote
LOL...Nice one,BB!
Sometimes patience pays off quicker than others.
Trailing stop?
I agree but the report does highlight Duke's projects,fwiw.
ABI: Smart Grid Spending Will Top $45 Billion by 2015
NEW YORK - July 8, 2010
Cumulative global investment in smart grids, including smart meter implementations as well as upgrades to the transmission and distribution infrastructure, will approach $46 billion by 2015, according to the latest forecasts from ABI Research.
A smart grid is an energy generation, transmission and distribution system equipped with an advanced two-way communications system that allows for greater visibility, control, and automation over the system for the utility operator. Simultaneously it provides a greater level of energy usage choice and automation for customers. It’s that communications system that makes a grid truly ‘smart,’ because it allows for the real-time monitoring of the current operational state of the network, as well as the ability to respond to those conditions automatically, as quickly as possible.
Larry Fisher, research director of NextGen, the ABI Research unit that published this study, says, “Most of the electric utility infrastructure deployed in the industrialized world was built between 60 and 80 years ago. Much of this infrastructure is outdated, and with the continuing increase in demand for power year after year, the grid cannot safely and reliably manage the loads of today and tomorrow without significant upgrades.”
The groundwork for smart grids has been laid in a number of countries over the past several years, but the pace of investment and implementation is increasing. Fisher notes, “Transmission and Distribution (T&D) investments will account for the lion’s share of smart grid investments through 2015; on a cumulative basis, a total of almost $41 billion will be invested globally in the electrical Transmission and Distribution infrastructure through 2015, compared to $4.8 billion for the purchase and installation of smart meters. This infrastructure spending will focus on grid automation and control, distribution automation, distributed generation and demand response programs.”
ABI Research’s new study “Smart Grid Applications: Smart Meters, Demand Response, and Distributed Generation” forecasts the market for smart grid equipment and services for the 2010-2015 period, covering North America, Europe, the Asia-Pacific region, and selected other countries.
It provides the outlook for smart meter installations, as well as the spending associated with them. It also examines and forecasts spending on smart grid-related Transmission and Distribution (T&D) infrastructure, as well as implementation of specific smart grid-related components at the utility level, such as synchrophasors and HAN communication chipsets.
This study is published under the Energy and Clean Technology Research Service which is a part of NextGen, the ABI Research emerging technologies research incubator.
ABI Research provides in-depth analysis and quantitative forecasting of trends in global connectivity and other emerging technologies. From offices in North America, Europe and Asia, ABI Research’s worldwide team of experts advises thousands of decision makers through 28 research and advisory services. Est. 1990. For more information visit www.abiresearch.com, or call +1.516.624.2500.
http://www.abiresearch.com/press/1688-Smart+Grid+Spending+Will+Top+$45+Billion+by+2015