Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the second quarter and six months ended June 30, 2021.

For the quarter ended June 30, 2021, Hudson reported revenues of $60.5 million, an increase of 27% compared to revenues of $47.7 million in the comparable 2020 period. Second quarter revenue growth was driven by increased demand as well as increased selling prices for certain refrigerants during the period. Gross margin in the second quarter of 2021 was 36%, compared to 27% in the second quarter of 2020, mainly due to the aforementioned increase in selling price of certain refrigerants. Hudson reported operating income of $14.4 million in the second quarter of 2021 compared to operating income of $5.2 million in the prior year period. The Company recorded net income of $11.3 million or $0.26 per basic and $0.24 per diluted share in the second quarter of 2021, compared to net income of $2.4 million or $0.06 per basic and diluted share in the same period of 2020.

For the six months ended June 30, 2021 Hudson reported revenues of $94.3 million, an increase of 12% compared to revenues of $84.0 million in the first six months of 2020. The revenue growth was driven by increased demand as well as increased selling prices for certain refrigerants during the period. Gross margin in the first half of 2021 was 33%, compared to 25% in the first half of 2020, mainly due to the aforementioned increase in selling price of certain refrigerants. Hudson reported operating income of $16.1 million for the first six months of 2021 compared to operating income of $5.6 million in the prior year period. The Company recorded net income of $10.2 million or $0.23 per basic and $0.22 per diluted share in the first half of 2021, compared to a net loss of $0.5 million or ($0.01) per basic and diluted share in the same period of 2020.

At June 30, 2021, the Company had approximately $41 million of total availability, consisting of cash and cash equivalents plus revolving loan availability.

Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies commented, “We are pleased to have delivered strong second quarter results as demonstrated by substantial revenue growth and significantly improved profitability. Our performance was driven by increased demand as well as favorable pricing trends across our portfolio of refrigerants. We view the selling season as a nine-month period, and the second quarter has historically been a strong quarter for us as it typically coincides with warmer weather in the North and Northeast resulting in the start-up of cooling systems. During the second quarter, our business also benefitted from the favorable impact of the U.S. economy reopening. As we move through the balance of our selling season, we’re optimistic about the activity and interest we’re seeing for our products in the marketplace.

“Additionally, from a regulatory perspective, we’re looking forward to the anticipated publication of HFC allocations in September as the allocation portion of the AIM Act goes into effect.   When the allocations become public, we’ll have more visibility around how the industry will be positioned to supply the large and growing installed base of HFC systems as virgin production begins it phasedown starting in 2022. The AIM Act establishes a cumulative 40% reduction in the baseline by 2024 and we anticipate that reclamation will be critical to maintaining necessary supply during this HFC phasedown period. Given our reclamation capabilities and robust distribution network, Hudson is uniquely positioned as both a supplier and a reclaimer, to meet potential supply shortfalls as virgin HFC production is phased down to 15% in the year 2036. We believe the upcoming HFC phasedown represents a tremendous long-term growth opportunity and will create a favorable environment for us to capture additional business with our sustainable, reclaimed refrigerant offerings,” Mr. Coleman concluded.

Conference Call Information

The Company will host a conference call and webcast to discuss the second quarter results today, August 4, 2021 at 5:00 P.M. Eastern Time.

To access the live webcast, log onto the Hudson Technologies website at www.hudsontech.com, and click on “Investor Relations”.

To participate in the call by phone, dial (888) 506-0062 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use entry code: 685058.

A replay of the teleconference will be available until September 3, 2021 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 42153.

About Hudson Technologies         

Hudson Technologies, Inc. is a leading provider of innovative and sustainable solutions for optimizing performance and enhancing reliability of commercial and industrial chiller plants and refrigeration systems. Hudson's proprietary RefrigerantSide® Services increase operating efficiency, provide energy and cost savings, reduce greenhouse gas emissions and the plant’s carbon footprint while enhancing system life and reliability of operations at the same time. RefrigerantSide® Services can be performed at a customer's site as an integral part of an effective scheduled maintenance program or in response to emergencies. Hudson also offers SMARTenergy OPS®, which is a cloud-based Managed Software as a Service for continuous monitoring, fault detection and diagnostics and real-time optimization of chilled water plants. In addition, the Company sells refrigerants and provides traditional reclamation services for commercial and industrial air conditioning and refrigeration uses. For further information on Hudson, please visit the Company's web site at www.hudsontech.com. 

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Statements contained herein which are not historical facts constitute forward-looking statements. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which 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.  Such factors include, but are not limited to, changes in the laws and regulations affecting the industry, changes in the demand and price for refrigerants (including unfavorable market conditions adversely affecting the demand for, and the price of, refrigerants), the Company's ability to source refrigerants, regulatory and economic factors, seasonality, competition, litigation, the nature of supplier or customer arrangements that become available to the Company in the future, adverse weather conditions, possible technological obsolescence of existing products and services, possible reduction in the carrying value of long-lived assets, estimates of the useful life of its assets, potential environmental liability, customer concentration, the ability to obtain financing, the ability to meet financial covenants under existing credit facilities, any delays or interruptions in bringing products and services to market, the timely availability of any requisite permits and authorizations from governmental entities and third parties as well as factors relating to doing business outside the United States, including changes in the laws, regulations, policies, and political, financial and economic conditions, including inflation, interest and currency exchange rates, of countries in which the Company may seek to conduct business, the Company’s ability to successfully integrate any assets it acquires from third parties into its operations, the impact of the current COVID-19 pandemic, and other risks detailed in the Company's 10-K for the year ended December 31, 2020 and other subsequent filings with the Securities and Exchange Commission. The words "believe", "expect", "anticipate", "may", "plan", "should" and similar expressions identify forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.

Investor Relations Contact:John Nesbett/Jennifer BelodeauIMS Investor Relations (203) 972-9200jnesbett@institutionalms.com Company Contact:Brian F. Coleman, President & CEOHudson Technologies, Inc.(845) 735-6000bcoleman@hudsontech.com

Hudson Technologies, Inc. and SubsidiariesConsolidated Balance Sheets(Amounts in thousands, except for share and par value amounts)

             
       June 30,       December 31, 
    2021   2020 
    (unaudited)      
Assets              
Current assets:              
Cash and cash equivalents   $ 1,873     $ 1,348  
Trade accounts receivable – net     33,314       9,806  
Inventories – net     48,251       44,460  
Prepaid expenses and other current assets     11,186       6,528  
Total current assets     94,624       62,142  
             
Property, plant and equipment, less accumulated depreciation     20,634       21,910  
Goodwill     47,803       47,803  
Intangible assets, less accumulated amortization     21,753       23,150  
Right of use asset     5,554       6,559  
Other assets     314       85  
Total Assets   $ 190,682     $ 161,649  
             
Liabilities and Stockholders’ Equity            
Current liabilities:            
Trade accounts payable   $ 8,936     $ 7,644  
Accrued expenses and other current liabilities     27,334       19,417  
Accrued payroll     1,859       1,394  
Short-term debt     14,000       2,000  
Current maturities of long-term debt     7,724       7,314  
Total current liabilities     59,853       37,769  
Deferred tax liability     1,472       1,355  
Long-term lease liabilities     2,809       3,927  
Long-term debt, less current maturities     75,351       77,976  
Total Liabilities     139,485       121,027  
             
Commitments and contingencies            
             
Stockholders’ equity:            
Preferred stock, shares authorized 5,000,000: Series A Convertible preferred stock, $0.01 par value ($100 liquidation preference value); shares authorized 150,000; none issued or outstanding            
Common stock, $0.01 par value; shares authorized 100,000,000; issued and outstanding 43,707,392 and 43,347,887, respectively     437       433  
Additional paid-in capital     118,639       118,269  
Accumulated deficit     (67,879 )     (78,080 )
Total Stockholders’ Equity     51,197       40,622  
             
Total Liabilities and Stockholders’ Equity   $ 190,682     $ 161,649  

Hudson Technologies, Inc. and SubsidiariesConsolidated Statements of Operations(unaudited)(Amounts in thousands, except for share and per share amounts)

                         
       Three months      Six months
    ended June 30,    ended June 30, 
       2021      2020      2021      2020 
                         
Revenues   $ 60,548   $ 47,677     $ 94,328   $ 84,027  
Cost of sales     38,720     34,996       63,362     62,999  
Gross profit     21,828     12,681       30,966     21,028  
                         
Operating expenses:                        
Selling, general and administrative     6,766     6,757       13,514     14,022  
Amortization     699     716       1,397     1,432  
Total operating expenses     7,465     7,473       14,911     15,454  
                         
Operating income     14,363     5,208       16,055     5,574  
                         
Other expense:                        
Net interest expense     2,872     3,132       5,689     6,446  
Other (income) expenses     5     (8 )     5     (11 )
Total other expense     2,877     3,124       5,694     6,435  
                         
Income (loss) before income taxes     11,486     2,084       10,361     (861 )
                         
Income tax (benefit) expense     209     (302 )     160     (362 )
                         
Net income (loss)   $ 11,277   $ 2,386     $ 10,201   $ (499 )
                         
Net income(loss) per common share – Basic   $ 0.26   $ 0.06     $ 0.23   $ (0.01 )
Net income (loss) per common share – Diluted   $ 0.24   $ 0.06     $ 0.22   $ (0.01 )
Weighted average number of shares outstanding – Basic     43,498,908     42,628,560       43,426,463     42,628,560  
Weighted average number of shares outstanding – Diluted     46,418,807     42,917,562       45,844,545     42,628,560  
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