Clean Diesel Technologies, Inc. Reports First Quarter 2011 Financial Results
By Clean Diesel Technologies Inc., PRNEThursday, May 12, 2011
VENTURA, California, May 13, 2011 - Clean Diesel Technologies, Inc. (NASDAQ: CDTI) ("Clean Diesel" or the
"Company"), a cleantech emissions reduction company, announced today its
financial results for the first quarter ended March 31, 2011.
- Total first quarter revenue was $13.8 million, up 11.3% compared to
prior year.
- First quarter revenue for Clean Diesel's Heavy Duty Diesel Systems
division increased $1.9 million, or 25.3% compared to prior year.
- Gross margin was consistent at 29% for the first quarter of 2011
compared to the same period in 2010.
First Quarter 2011 vs. First Quarter 2010
The October 15, 2010 business combination with Catalytic Solutions, Inc.
(or "CSI"), which we refer to as the "Merger" was accounted for as a reverse
acquisition. Accordingly, Clean Diesel's (the legal acquirer's) consolidated
financial statements are now those of CSI (the accounting acquirer), with its
assets and liabilities and revenues and expenses being included in CSI's
financial statements effective from October 15, 2010, the closing date of the
Merger. As such, the amounts discussed below for periods prior to the Merger
are those of CSI and its consolidated subsidiaries, with amounts of legacy
Clean Diesel operations included from the date of the Merger.
Total revenue for the first quarter of 2011 was $13.8 million up 11.3%
from $12.4 million for the same quarter in 2010. Total revenue includes $0.7
million from legacy Clean Diesel business as a result of the Merger. Net loss
for the first quarter of 2011 was $2.3 million, or $0.58 per share, compared
to net income of $2.6 million, or $4.70 per share, in the comparable period
in 2010. Net income for the first quarter of 2010 included a pre-tax gain of
$3.9 million from the sale of intellectual property rights to our Asian
joint-venture partner. Diluted common shares outstanding were 3,984,000 in
the current quarter compared to 552,000 in the same quarter a year ago, with
the increase in the number of shares due principally to the effect of the
Merger and related transactions and the subsequent exercise of certain
warrants issued in connection with the Merger.
Revenue for Clean Diesel's Heavy Duty Diesel Systems division for the
quarter ended March 31, 2011 increased $1.9 million, or 25.3%, to $9.4
million from $7.5 million for the quarter ended March 31, 2010. This includes
$0.7 million from legacy Clean Diesel business as a result of the Merger, all
of which is included in Clean Diesel's Heavy Duty Diesel Systems division.
Revenue for Clean Diesel's Catalyst division for the quarter ended March
31, 2011 decreased $0.4 million, or 7.8%, to $4.7 million from $5.1 million
for the quarter ended March 31, 2010.
At March 31, 2011 and December 31, 2010, respectively, Clean Diesel had
cash and cash equivalents of $1.2 million and $5.0 million. Not included in
such amounts are the net proceeds from the May 2011 sale of $3.0 million
principal amount of Clean Diesel's 8.0% subordinated convertible notes, which
are to be used for general working capital purposes. Working capital surplus
was $1.7 million at March 31, 2011 compared to a working capital surplus of
$2.8 million at December 31, 2010. Additional information about the Company's
financial results will be available in its Quarterly Report on Form 10-Q to
be filed with the U.S. Securities and Exchange Commission:
www.sec.gov. A copy of the Form 10-Q will be posted on the Company's
website at www.cdti.com.
Charles F. Call, Chief Executive Officer of Clean Diesel, stated,
"Overall, I am encouraged by our results this quarter as our markets and the
global economy continue to strengthen. Our business divisions, Heavy Duty
Diesel Systems and Catalyst, performed largely as planned. We continue to be
optimistic about growth in our Heavy Duty Diesel Systems division and we were
pleased to report revenue growth of more than 25% for this division in the
first quarter compared to the same period in 2010. Going forward, depending
on the timing of certain heavy duty diesel retrofit programs, we expect to
see continued improvement in our business as we capture the opportunities
available in the London Low Emission Zone (LEZ) in the second half of the
year. In addition, on April 6, 2011 the California Air Resources Board (CARB)
announced an incentive program for truck operators to accelerate purchases of
particulate filter retrofits to the second quarter of 2011. This incentive
program is related to a mandatory program announced by CARB in late 2010
requiring heavier diesel vehicles to conform to new standards between 2012
and 2016, with 90% by 2014. Our team is very enthusiastic about this
opportunity and we have already begun to see increased business activity in
our Heavy Duty Diesel Systems division as a result of this program in the
second quarter.
"As anticipated, our Catalyst division sales decreased as a result of an
automaker accelerating the manufacture of a vehicle that requires a catalyst
product meeting a higher regulatory standard than the product we currently
supply to the automaker, which was only partially offset by growth in sales
to another automaker and sales to a new automaker customer in the first
quarter. Looking further into 2011 and as previously discussed, the
earthquake and subsequent tsunami in Japan resulted in one of our Catalyst
division customers reducing their production. This unfortunate event will
result in lower catalyst sales in the second quarter of 2011. We are in
frequent communication with our customer and, at this time, it is not certain
as to how long this disruption will last.
"We anticipate that following approval by the regulatory agencies
(expected sometime in the second quarter of 2011) we will have the ability to
supply our own manufactured catalyst products to our Heavy Duty Diesel
Systems division, which we expect will improve our total gross margins."
Mr. Call concluded, "Through our continued investments in local
capabilities in fast-growing global markets, development of new technology,
and cost structure reductions, we have taken significant steps to position
our company for the future. We continue to evaluate our options for providing
the additional working capital that will be needed. We are optimistic about
the growth opportunities presented by our markets and confident we can
further drive value creation for our shareholders while steadily increasing
the delivery of customer-focused innovation."
Conference Call and Webcast Information
Clean Diesel will host a conference call and simultaneous webcast over
the Internet beginning at 2:00 p.m. Pacific Time today to discuss its
financial results and its business outlook. This conference call will contain
forward-looking information. To participate in the conference call, dial
+1-877-303-9240 and use confirmation code 67030864. International participants
should dial +1-760-666-3571 and use the same confirmation code. The
conference call will be webcast live on the Clean Diesel website at
www.cdti.com under the "Investor Relations" section. To listen to the live
webcast, participants should visit the site at least 15 minutes prior to the
conference to download any required streaming media software. An archived
recording of the conference call will be available on the Clean Diesel
website for 30 days.
About Clean Diesel Technologies, Inc.
Clean Diesel Technologies ("Clean Diesel") is a vertically integrated
global manufacturer and distributor of emissions control systems and
products, focused on the heavy duty diesel and light duty vehicle markets.
Clean Diesel utilizes its proprietary patented Mixed Phase Catalyst (MPC(R))
technology, as well as its ARIS(R) selective catalytic reduction, Platinum
Plus(R) fuel-borne catalyst, and other technologies to provide high-value
sustainable solutions to reduce emissions, increase energy efficiency and
lower the carbon intensity of on- and off-road engine applications. Clean
Diesel is headquartered in Ventura, California, along with its wholly-owned
subsidiary, Catalytic Solutions, Inc., and currently has operations in the
U.S., Canada, U.K., France, Japan and Sweden as well as an Asian joint
venture. For more information, please visit www.cdti.com and
www.catsolns.com.
Forward-Looking Statements Safe Harbor
Certain statements in this news release, such as statements about
spending on government emission reduction programs, ability to capitalize on
LEZ and other retrofit opportunities, regulatory approvals for Catalyst
products, sales of Catalyst products to a new automaker customer and
resumption of sales to former automaker customer, as well as the effects of
the Japanese earthquake and tsunami on another automaker customer constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements involve known
or unknown risks, including those detailed in the Company's filings with the
U.S. Securities and Exchange Commission, uncertainties and other factors that
may cause the actual results, performance or achievements of the Company to
be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Readers are
cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof. The Company assumes no obligation to
update the forward-looking information contained in this release.
Clean Diesel Technologies, Inc.
Summary Income Statements (unaudited)
($ millions, except per share amounts)
3 Months Ended
March 31
--------------
2011 2010
---- ----
Revenues $13.8 $12.4
Gross profit 4.0 3.6
Operating expenses:
Selling, general and administrative 4.6 3.0
Research and development 1.5 1.0
Recapitalization expense - 0.2
Gain on sale of intellectual property - (3.9)
--- ----
Total operating expenses $6.1 $0.3
(Loss) income from operations $(2.1) $3.3
Other expense - 0.4
--- ---
(Loss) income from continuing operations before
income tax (2.1) 2.9
Income tax expense from continuing
operations 0.2 0.2
--- ---
Net (loss) income from continuing
operations (2.3) 2.7
Net loss from discontinued operations - 0.1
--- ---
Net (loss) income $(2.3) $2.6
----- ---
Diluted EPS $(0.58) $4.70
Diluted shares outstanding (in
thousands) 3,984 552
Clean Diesel Technologies, Inc.
Segment Information
($ millions)
3 Months Ended
March 31
--------------
2011 2010
---- ----
Revenue
Heavy Duty
Diesel Systems $9.4 $7.5
Catalyst 4.7 5.1
Eliminations (0.3) (0.2)
---- ----
Total $13.8 $12.4
===== =====
Income (loss)
from operations
Heavy Duty
Diesel Systems $0.3 $1.1
Catalyst (0.5) 3.7
Corporate (1.9) (1.5)
Total $(2.1) $3.3
===== ====
Clean Diesel Technologies, Inc.
Summary Balance Sheets (unaudited)
($ millions)
As of
-----
March 31, December 31,
--------- ---------
2011 2010
---- ----
Total current assets $16.0 $17.6
Total assets $31.1 $32.6
Total current
liabilities $14.3 $14.8
Total long-term
liabilities $2.6 $2.6
Stockholders' equity $14.2 $15.3
Short-term debt $2.5 $2.4
Long-term debt $1.5 $1.5
Kristi Cushing, Investor Relations Manager of Clean Diesel Technologies, Inc., +1-805-639-9458
Tags: california, Clean Diesel Technologies Inc., May 13, Ventura
