Omega Protein Reports 7 Cents Per Share Third Quarter Profit
November 06 2006 - 6:31PM
PR Newswire (US)
HOUSTON, Nov. 6 /PRNewswire-FirstCall/ -- Omega Protein Corporation
(NYSE:OME), the nation's leading producer of Omega-3 fish oil and
specialty fish meal products, today reported net income of $1.8
million (7 cents a share) for the third quarter of 2006, compared
with a net loss of $6.1 million (25 cents a share) for the third
quarter of the previous year. Revenues for the third quarter ended
September 30, 2006 were $52.1 million compared with revenues of
$31.4 million for the comparable quarter in 2005. Omega Protein
recorded operating income of $3.0 million for the 2006 third
quarter, versus operating loss of $9.2 million for the third
quarter of 2005. For the nine months ended September 30, 2006, the
Company had revenues of $113.7 million, compared with $82.8 million
in revenues for the first nine months of 2005. Omega Protein
recorded operating income of $7.8 million for the nine months ended
September 30, 2006, versus operating loss of $8.2 million for the
comparable period a year earlier. The Company had net income of
$5.0 million (20 cents a share) for the nine months ended September
30, 2006, compared with net loss of $5.4 million (22 cents a share)
for the nine months ended September 30, 2005. The losses reported
for the previous periods presented were attributable to the direct
impact of two hurricanes on the Company's facilities and operations
in August and September of 2005. All of the Company's Gulf of
Mexico operations were impacted in 2005 and, to some extent,
diminished capabilities carried forward into 2006. The Company's
third quarter results, as well as the results for the nine months
ended September 30, 2006, are the result of higher sales prices and
increased sales volumes, offset by higher costs of sales. The
higher costs of sales were attributable to increased energy costs,
higher repair costs and poor fish oil production yields. Subsequent
to the closing of the third quarter, the Company and Abelco
Finance, LLC, an affiliate of Cerberus Capital Management, L.P.,
and Wachovia Bank, entered into a $65 million secured financing
facility. The financing facility consists of a five year revolving
credit facility of up to $30 million and a five year term loan
facility of $35 million. The financing facility replaced the
Company's existing $20 million former bank credit facility. The
financing facility will be used to close the previously announced
acquisition from Zapata of 9,268,292 shares of Omega's common stock
held by Zapata (the "Zapata Shares") for an aggregate purchase
price of $47.5 million, (ii) to fund the Company's ongoing working
capital and other general corporate requirements and (iii) to pay
the fees and expenses related to the financing. On October 20,
2006, the Company drew down the $35 million term loan and
approximately $13.6 million of revolving loans and funded into
escrow the $47.5 million purchase price for the Zapata Shares. In
connection with Omega's purchase of the Zapata Shares, Zapata has
filed its definitive Information Statement relating to that
transaction with the SEC and commenced the mailing to its
stockholders on or about November 6, 2006. The closing of the
transaction is expected in late November, subject to Omega's
receipt of a bring-down solvency opinion from its financial advisor
and the satisfaction of additional customary closing conditions.
About Omega Protein Omega Protein Corporation is the nation's
largest manufacturer of heart- healthy fish oils containing Omega-3
fatty acids for human consumption, as well as specialty fish meals
and fish oil used as value-added ingredients in aquaculture, swine
and other livestock feeds. Omega Protein makes its products from
menhaden, an Omega-3 rich fish that is not utilized as seafood, but
which is abundantly available along the U.S. Gulf of Mexico and
Atlantic Coasts. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS:
The statements contained in this press release that are not
historical facts are forward- looking statements that involve a
number of risks and uncertainties. The actual results of future
events described in any of these forward-looking statements could
differ materially from those stated in the forward-looking
statements. Important factors that could cause actual results to be
materially different from those forward-looking statements include,
among others, (1) the Company's ability to meet its raw material
requirements through its annual menhaden harvest, which is subject
to fluctuations due to natural conditions over which the Company
has no control, such as varying fish population, fish oil yields,
adverse weather conditions and disease; (2) the impact of worldwide
supply and demand relationships on prices for the Company's
products; (3) Omega Protein's expectations regarding demand for
OmegaPure(R) proving to be incorrect; and (4) fluctuations in the
Company's quarterly operating results due to the seasonality of the
Company's business and its deferral of inventory sales based on
worldwide prices for competing products. These and other factors
are described in further detail in Omega's filings with the
Securities and Exchange Commission, including its 2005 Annual
Report on Form 10K and its third quarter 2006 Quarterly Report on
Form 10-Q under the headings, "Management's Discussion and Analysis
of Financial Condition" and "Risk Factors." OMEGA PROTEIN
CORPORATION Statement of Operations (unaudited) Three Months Nine
Months Ended September 30, Ended September 30, 2006 2005 2006 2005
(in thousands, except per share amounts) Revenues $52,089 $31,418
$113,730 $82,759 Cost of sales 44,748 24,032 94,061 68,500 Gross
profit 7,341 7,386 19,669 14,259 Selling, general and
administrative expense 3,467 3,365 10,444 9,100 Loss resulting from
natural disaster 918 13,183 1,351 13,183 Loss on disposal of assets
--- 39 29 135 Operating income 2,956 (9,201) 7,845 (8,159) Interest
expense, net (398) (232) (1,043) (407) Other income (expense), net
(33) (66) (159) 125 Income before income taxes 2,525 (9,499) 6,643
(8,441) Provision for income taxes 713 (3,359) 1,675 (3,067) Net
income $1,812 $(6,140) $4,968 $(5,374) Basic earnings per share
$0.07 $(0.25) $0.20 $(0.22) Weighted average common shares
outstanding 25,153 24,997 25,095 24,957 Diluted earnings per share
$0.07 $(0.25) $0.19 $(0.22) Weighted average common shares and
common share equivalents outstanding 26,083 24,997 26,053 24,957
OMEGA PROTEIN CORPORATION CONDENSED BALANCE SHEET (Unaudited)
September 30, December 31, 2006 2005 (in thousands) ASSETS Current
assets $97,190 $98,390 Property and equipment, net 101,071 93,965
Deferred tax assets, net 4,838 6,293 Other assets 10,703 1,579
Total assets $213,802 $200,227 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $30,150 $19,270 Long-term debt, less current
maturities 25,823 27,658 Other long-term liabilities 9,492 10,932
Stockholders' equity 148,337 142,367 Total liabilities and
stockholders' equity $213,802 $200,227 Book value per share
outstanding $ 5.87 $ 5.69
http://www.newscom.com/cgi-bin/prnh/20030516/OMEGALOGO DATASOURCE:
Omega Protein Corporation CONTACT: Investor Relations of Omega
Protein Corporation, +1-713-623-0060, or Web site:
http://www.buyomegaprotein.com/
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