DALLAS, March 8, 2018 /PRNewswire/ -- CECO
Environmental Corp. (Nasdaq: CECE), a leading global air
quality and fluid handling company serving the energy, industrial
and other niche markets, today reported its financial results for
the fourth quarter and full year 2017.
Highlights of the Fourth Quarter 2017*
- Revenue of $73.5 million,
compared with $100.0 million
- Gross profit of $25.6 million
(34.8% margin), compared with $35.7
million (35.7% margin)
- Non-GAAP gross profit of $25.7
million (35.0% margin), compared with $35.8 million (35.8% margin)
- Operating loss of $(8.2) million,
compared with a $(50.4) million
loss
- Non-GAAP operating income of $3.5
million, compared with $14.7
million
- Net loss of $(11.6) million,
compared with a $(51.2) million
loss
- Non-GAAP net loss of $(1.7)
million, compared with non-GAAP net income of $12.0 million
- Net loss per diluted share of $(0.34), compared with $(1.49) loss per diluted share
- Non-GAAP net (loss)/income per diluted share of $(0.05), compared with $0.35
- Adjusted EBITDA of $4.9 million,
compared with $16.3 million
- Bookings of $91.4 million,
compared with $77.7
million
- Backlog of $168.9 million
Full-Year 2017 Highlights*
- Revenue of $345.1 million, down
$71.9 million
- Gross profit of $113.2 million,
down $21.7 million
- Gross margin of 32.8%, up 40 basis points
- Net loss of $(3.0) million, or
$(0.09) loss per share
- Non-GAAP net income of $9.5
million, or $0.27 per diluted
share
- Adjusted EBITDA of $34.5
million
* All comparisons are versus the comparable prior-year
period.
CECO's Chief Executive Officer Dennis
Sadlowski commented, "In the fourth quarter of 2017, we
accelerated actions behind our previously communicated refreshed
operating strategy. We implemented a restructuring program to
reduce costs, began to refocus our portfolio including exiting
non-core and low critical mass areas and are investing in our core
segments to accelerate growth. Despite ongoing market challenges
that reduced volume and generated disappointing financial results,
we have maintained solid gross margins and with a refreshed
outside-in approach to our business, picked up key wins and
increased bookings quarter over quarter. Our book to bill ratio
exceeded 1:1 for the first time in seven quarters representing an
inflection point for the company."
Mr. Sadlowski added, "Heading into 2018, we have already moved
swiftly with the clarity of our strategy to transform the business
to win market share and make an impact on our customers and the
world in which we live. We demonstrated our commitment to our new
strategy through the initial actions on our non-core asset sales
and investments in simplification and production machinery. We will
continue to invest in our growth platforms and major account
relationships with key customers around the world to ensure the
company is best-positioned as markets begin to rebound."
FOURTH QUARTER RESULTS
Revenue in the fourth quarter of 2017 was $73.5 million, down 26.5% from $100.0 million in the prior-year period.
Operating loss was $8.2 million
for the fourth quarter of 2017, compared with a $50.4 million operating loss in the prior-year
period. Non-GAAP operating income was $3.5 million (4.8% margin) for the fourth quarter
of 2017, compared with $14.7 million
(14.7% margin) in the prior-year period.
Net loss was $11.6 million for the
fourth quarter of 2017, compared with a $51.2 million net loss in the prior-year
period. Non-GAAP net loss was $1.7
million for the fourth quarter of 2017, compared with
non-GAAP net income of $12.0 million
in the prior-year period.
Net loss per diluted share was $0.34 for the fourth quarter of 2017, compared
with net loss per diluted share of $1.49 in the prior-year period. Non-GAAP net loss
per diluted share was $0.05 for the
fourth quarter of 2017, compared with non-GAAP net income per
diluted share of $0.35 for the
prior-year period.
Cash and cash equivalents were $29.9
million and bank debt was $117.7
million, as of December 31, 2017, compared with
$45.8 million and $126.4 million, respectively, as of December 31, 2016.
BACKLOG AND BOOKINGS
Total backlog at December 31, 2017 was $168.9 million as compared with $197.0 million on December
31, 2016 and $153.9 million as
of September 30, 2017.
Bookings were $91.4 million for
the fourth quarter of 2017, compared with $77.7 million in the prior-year period and
$71.0 in the third quarter of
2017. Bookings were $333.6
million for the year of 2017 as compared with $402.8 million for the prior-year period.
2017 FULL YEAR RESULTS
Revenue in the year of 2017 was $345.1
million, down 17.2% from $417.0
million in the prior-year period.
Operating income was $8.0 million
for the year 2017, compared with an operating loss of $25.6 million in the prior-year period. Non-GAAP
operating income was $28.3 million
for the year 2017, compared with $52.7
million in the prior-year period.
Net loss was $3.0 million for the
year 2017, compared with a net loss of $38.2
million in the prior-year period. Non-GAAP net income
was $9.5 million for the year 2017,
compared with $33.5 million in the
prior-year period.
Net loss per diluted share was $0.09 for the year 2017, compared with net loss
per diluted share of $1.12 in the
prior-year period. Non-GAAP net income per diluted share was
$0.27 for the year 2017, compared
with $0.99 for the prior-year
period.
CONFERENCE CALL
A conference call is scheduled for today at 7:30 a.m. CT to discuss the fourth quarter and
fiscal 2017 financial results. The conference call may also be
accessed by dialing 877-870-4263 (Toll-Free) within the U.S.,
855-669-9657 (Toll-Free) within Canada or Toll/International
412-317-0790. A replay will be available from
11:30 a.m. ET on March 8, 2018 until March
22, 2018 at 11:59 p.m. ET. The
replay may be accessed by dialing 877-344-7529 (Toll-Free) within
the U.S., 855-669-9658 (Toll-Free) within Canada, or Toll/International 412-317-0088 and
entering access code 10117555.
The live webcast and slides can also be accessed at
https://www.cecoenviro.com/events-calendar.
ABOUT CECO ENVIRONMENTAL
CECO Environmental is a global leader in industrial air quality
and fluid handling serving the energy, industrial and other niche
markets through an attractive asset-light business model. CECO
provides innovative technology and application expertise that helps
companies grow their businesses with safe, clean, and more
efficient solutions to help protect our shared environment. CECO
serves both established and emerging industries in regions around
the world working to improve air quality, optimize the energy value
chain, and provide customized engineered solutions in multiple
applications that include oil and gas, power generation, water and
wastewater, battery production, poly silicon fabrication, chemical
and petrochemical processing, along with a wide range of others.
CECO has over $5 billion of installed
equipment base with end users, which we target to expand and grow a
higher recurring revenue of aftermarket products and services. We
also continue to focus on operational excellence strategies as a
central theme to improving our earnings and cash flows. CECO is
listed on Nasdaq under the ticker symbol "CECE." For more
information, please visit http://www.cecoenviro.com/.
Contact:
Matthew Eckl, Chief Financial
Officer
800.333.5475
investor.relations@onececo.com
CECO ENVIRONMENTAL
CORP. AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
December
31,
|
|
($ in thousands,
except shares and per share data)
|
|
2017
|
|
|
2016
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
29,902
|
|
|
$
|
45,824
|
|
Restricted
cash
|
|
|
591
|
|
|
|
1,498
|
|
Accounts receivable,
net
|
|
|
67,990
|
|
|
|
83,062
|
|
Costs and estimated
earnings in excess of billings on uncompleted contracts
|
|
|
33,947
|
|
|
|
38,123
|
|
Inventories,
net
|
|
|
20,969
|
|
|
|
21,487
|
|
Prepaid expenses and
other current assets
|
|
|
10,760
|
|
|
|
13,560
|
|
Prepaid income
taxes
|
|
|
1,930
|
|
|
|
1,590
|
|
Assets held for
sale
|
|
|
7,853
|
|
|
|
7,834
|
|
Total current
assets
|
|
|
173,942
|
|
|
|
212,978
|
|
Property, plant and
equipment, net
|
|
|
23,400
|
|
|
|
27,270
|
|
Goodwill
|
|
|
166,951
|
|
|
|
170,153
|
|
Intangible assets –
finite life, net
|
|
|
49,956
|
|
|
|
60,728
|
|
Intangible assets –
indefinite life
|
|
|
19,691
|
|
|
|
22,042
|
|
Deferred charges and
other assets
|
|
|
4,609
|
|
|
|
5,463
|
|
Total
assets
|
|
$
|
438,549
|
|
|
$
|
498,634
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Current portion of
debt
|
|
$
|
11,296
|
|
|
$
|
8,827
|
|
Accounts payable and
accrued expenses
|
|
|
70,786
|
|
|
|
95,610
|
|
Billings in excess of
costs and estimated earnings on uncompleted contracts
|
|
|
20,469
|
|
|
|
35,085
|
|
Note
payable
|
|
|
5,300
|
|
|
|
5,300
|
|
Income taxes
payable
|
|
|
—
|
|
|
|
1,536
|
|
Total current
liabilities
|
|
|
107,851
|
|
|
|
146,358
|
|
Other
liabilities
|
|
|
30,382
|
|
|
|
34,864
|
|
Debt, less current
portion
|
|
|
103,537
|
|
|
|
114,366
|
|
Deferred income tax
liability, net
|
|
|
10,210
|
|
|
|
12,964
|
|
Total
liabilities
|
|
|
251,980
|
|
|
|
308,552
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
Preferred stock, $.01
par value; 10,000 shares authorized, none issued
|
|
|
—
|
|
|
|
—
|
|
Common stock, $.01 par
value; 100,000,000 shares authorized, 34,707,924 and
34,300,209 shares issued and outstanding at December
31, 2017
and
2016, respectively
|
|
|
347
|
|
|
|
343
|
|
Capital in excess of
par value
|
|
|
248,170
|
|
|
|
244,878
|
|
Accumulated
loss
|
|
|
(52,673)
|
|
|
|
(41,741)
|
|
Accumulated other
comprehensive loss
|
|
|
(8,919)
|
|
|
|
(13,042)
|
|
|
|
|
186,925
|
|
|
|
190,438
|
|
Less treasury stock,
at cost, 137,920 shares at December 31, 2017 and 2016
|
|
|
(356)
|
|
|
|
(356)
|
|
Total shareholders'
equity
|
|
|
186,569
|
|
|
|
190,082
|
|
Total liabilities and
shareholders' equity
|
|
$
|
438,549
|
|
|
$
|
498,634
|
|
CECO ENVIRONMENTAL
CORP. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(unaudited)
|
|
|
For the Three Months
Ended
December 31,
|
|
|
For the Year Ended
December 31,
|
|
(dollars in
thousands, except shares and per share data)
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
Net sales
|
|
$
|
73,543
|
|
|
$
|
99,982
|
|
|
$
|
345,051
|
|
|
$
|
417,011
|
|
Cost of
sales
|
|
|
47,897
|
|
|
|
64,315
|
|
|
|
231,857
|
|
|
|
282,152
|
|
Gross
profit
|
|
|
25,646
|
|
|
|
35,667
|
|
|
|
113,194
|
|
|
|
134,859
|
|
Selling and
administrative expenses
|
|
|
22,285
|
|
|
|
21,118
|
|
|
|
88,975
|
|
|
|
81,743
|
|
Acquisition and
integration expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
524
|
|
Amortization and
earnout expenses
|
|
|
2,509
|
|
|
|
7,055
|
|
|
|
7,132
|
|
|
|
20,231
|
|
Intangible asset and
goodwill impairment
|
|
|
7,168
|
|
|
|
57,923
|
|
|
|
7,168
|
|
|
|
57,923
|
|
Restructuring
expense
|
|
|
1,895
|
|
|
|
-
|
|
|
|
1,895
|
|
|
|
-
|
|
(Loss) income from
operations
|
|
|
(8,211)
|
|
|
|
(50,429)
|
|
|
|
8,024
|
|
|
|
(25,562)
|
|
Other (expense)
income, net
|
|
|
(35)
|
|
|
|
(85)
|
|
|
|
106
|
|
|
|
310
|
|
Interest
expense
|
|
|
(1,770)
|
|
|
|
(1,717)
|
|
|
|
(6,721)
|
|
|
|
(7,712)
|
|
(Loss) income before
income taxes
|
|
|
(10,016)
|
|
|
|
(52,231)
|
|
|
|
1,409
|
|
|
|
(32,964)
|
|
Income tax
expense
|
|
|
1,573
|
|
|
|
(1,059)
|
|
|
|
4,438
|
|
|
|
5,290
|
|
Net loss
|
|
$
|
(11,589)
|
|
|
$
|
(51,172)
|
|
|
$
|
(3,029)
|
|
|
$
|
(38,254)
|
|
Net loss attributable
to noncontrolling interest
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(36)
|
|
Net loss attributable
to CECO Environmental Corp.
|
|
$
|
(11,589)
|
|
|
$
|
(51,172)
|
|
|
$
|
(3,029)
|
|
|
$
|
(38,218)
|
|
Loss per share
attributable to CECO Environmental Corp.:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.34)
|
|
|
$
|
(1.49)
|
|
|
$
|
(0.09)
|
|
|
$
|
(1.12)
|
|
Diluted
|
|
$
|
(0.34)
|
|
|
$
|
(1.49)
|
|
|
$
|
(0.09)
|
|
|
$
|
(1.12)
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
34,568,508
|
|
|
|
34,280,940
|
|
|
|
34,445,256
|
|
|
|
33,979,549
|
|
Diluted
|
|
|
34,568,508
|
|
|
|
34,280,940
|
|
|
|
34,445,256
|
|
|
|
33,979,549
|
|
CECO ENVIRONMENTAL
CORP. AND SUBSIDIARIES
|
|
RECONCILIATION OF
GAAP TO NON-GAAP MEASURES
|
|
|
|
Three Months Ended
December 31,
|
|
|
For the Year Ended
December 31,
|
|
(dollars in
millions)
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
Gross profit as
reported in accordance with GAAP
|
|
$
|
25.6
|
|
|
$
|
35.7
|
|
|
$
|
113.2
|
|
|
$
|
134.9
|
|
Gross profit margin
in accordance with GAAP
|
|
|
34.8
|
%
|
|
|
35.7
|
%
|
|
|
32.8
|
%
|
|
|
32.4
|
%
|
Legacy design
repairs
|
|
|
—
|
|
|
|
—
|
|
|
|
2.0
|
|
|
|
—
|
|
Inventory valuation
adjustment
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
Plant, property and
equipment valuation adjustment
|
|
|
0.1
|
|
|
|
0.1
|
|
|
|
0.6
|
|
|
|
0.6
|
|
Non-GAAP gross
profit
|
|
$
|
25.7
|
|
|
$
|
35.8
|
|
|
$
|
115.8
|
|
|
$
|
135.6
|
|
Non-GAAP gross
profit margin
|
|
|
35.0
|
%
|
|
|
35.8
|
%
|
|
|
33.6
|
%
|
|
|
32.5
|
%
|
|
|
Three Months Ended
December 31,
|
|
|
For the Year Ended
December 31,
|
|
(dollars in
millions)
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
Operating (loss)
income as reported in accordance with GAAP
|
|
$
|
(8.2)
|
|
|
$
|
(50.4)
|
|
|
$
|
8.0
|
|
|
$
|
(25.6)
|
|
Operating margin in
accordance with GAAP
|
|
|
(11.2)%
|
|
|
|
(50.4)%
|
|
|
|
2.3
|
%
|
|
|
(6.1)%
|
|
Legacy design
repairs
|
|
|
—
|
|
|
|
—
|
|
|
|
2.0
|
|
|
|
—
|
|
Inventory valuation
adjustment
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
Plant, property and
equipment valuation adjustment
|
|
|
0.1
|
|
|
|
0.1
|
|
|
|
0.6
|
|
|
|
0.6
|
|
Gain on insurance
settlement
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1.0)
|
|
Acquisition and
integration expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.5
|
|
Amortization and
earnout (income) expenses, net
|
|
|
2.5
|
|
|
|
7.1
|
|
|
|
7.1
|
|
|
|
20.2
|
|
Intangible asset and
goodwill impairment
|
|
|
7.2
|
|
|
|
57.9
|
|
|
|
7.2
|
|
|
|
57.9
|
|
Restructuring
expense
|
|
|
1.9
|
|
|
|
—
|
|
|
|
1.9
|
|
|
|
—
|
|
Executive transition
expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
1.3
|
|
|
|
—
|
|
Facility exit
expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
0.2
|
|
|
|
—
|
|
Non-GAAP operating
income
|
|
$
|
3.5
|
|
|
$
|
14.7
|
|
|
$
|
28.3
|
|
|
$
|
52.7
|
|
Non-GAAP operating
margin
|
|
|
4.8
|
%
|
|
|
14.7
|
%
|
|
|
8.2
|
%
|
|
|
12.6
|
%
|
|
|
Three Months Ended
December 31,
|
|
|
For the Year Ended
December 31,
|
|
(dollars in
millions)
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
Net loss as reported
in accordance with GAAP
|
|
$
|
(11.6)
|
|
|
$
|
(51.2)
|
|
|
$
|
(3.0)
|
|
|
$
|
(38.2)
|
|
Legacy design
repairs
|
|
|
—
|
|
|
|
—
|
|
|
|
2.0
|
|
|
|
—
|
|
Inventory valuation
adjustment
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
Plant, property and
equipment valuation adjustment
|
|
|
0.1
|
|
|
|
0.1
|
|
|
|
0.6
|
|
|
|
0.6
|
|
Gain on insurance
settlement
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1.0)
|
|
Acquisition and
integration expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.5
|
|
Amortization and
earnout (income) expenses, net
|
|
|
2.5
|
|
|
|
7.1
|
|
|
|
7.1
|
|
|
|
20.2
|
|
Intangible asset and
goodwill impairment
|
|
|
7.2
|
|
|
|
57.9
|
|
|
|
7.2
|
|
|
|
57.9
|
|
Restructuring
expense
|
|
|
1.9
|
|
|
|
—
|
|
|
|
1.9
|
|
|
|
—
|
|
Executive transition
expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
1.3
|
|
|
|
—
|
|
Facility exit
expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
0.2
|
|
|
|
—
|
|
Foreign currency
remeasurement
|
|
|
(0.1)
|
|
|
|
1.4
|
|
|
|
(2.1)
|
|
|
|
0.8
|
|
Tax benefit of
adjustments
|
|
|
(1.7)
|
|
|
|
(3.3)
|
|
|
|
(5.7)
|
|
|
|
(7.4)
|
|
Non-GAAP net (loss)
income
|
|
$
|
(1.7)
|
|
|
$
|
12.0
|
|
|
$
|
9.5
|
|
|
$
|
33.5
|
|
Depreciation
|
|
|
0.9
|
|
|
|
1.1
|
|
|
|
3.9
|
|
|
|
4.5
|
|
Non-cash stock
compensation (excluding executive transition costs)
|
|
|
0.5
|
|
|
|
0.6
|
|
|
|
2.3
|
|
|
|
2.3
|
|
Other expense
(income)
|
|
|
0.1
|
|
|
|
(1.3)
|
|
|
|
2.0
|
|
|
|
(1.1)
|
|
Gain on insurance
settlement
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1.0
|
|
Interest
expense
|
|
|
1.8
|
|
|
|
1.7
|
|
|
|
6.7
|
|
|
|
7.7
|
|
Income tax
expense
|
|
|
3.3
|
|
|
|
2.2
|
|
|
|
10.1
|
|
|
|
12.7
|
|
Adjusted
EBITDA
|
|
$
|
4.9
|
|
|
$
|
16.3
|
|
|
$
|
34.5
|
|
|
$
|
60.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.34)
|
|
|
$
|
(1.49)
|
|
|
$
|
(0.09)
|
|
|
$
|
(1.12)
|
|
Diluted
|
|
$
|
(0.34)
|
|
|
$
|
(1.49)
|
|
|
$
|
(0.09)
|
|
|
$
|
(1.12)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net (loss)
income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.05)
|
|
|
$
|
0.35
|
|
|
$
|
0.28
|
|
|
$
|
0.99
|
|
Diluted
|
|
$
|
(0.05)
|
|
|
$
|
0.35
|
|
|
$
|
0.27
|
|
|
$
|
0.99
|
|
NOTE REGARDING NON-GAAP FINANCIAL
MEASURES
CECO is providing certain non-GAAP historical financial measures
as presented above as the Company believes that these figures are
helpful in allowing individuals to better assess the ongoing nature
of CECO's core operations. A "non-GAAP financial measure" is a
numerical measure of a company's historical financial performance
that excludes amounts that are included in the most directly
comparable measure calculated and presented in the GAAP statement
of operations.
Non-GAAP gross profit, non-GAAP operating income, non-GAAP net
income, non-GAAP gross profit margin, non-GAAP operating margin,
non-GAAP earnings per basic and diluted share and adjusted EBITDA,
as we present them in the financial data included in this press
release, have been adjusted to exclude the effects of expenses
related to legacy design repairs, inventory valuation adjustments,
property, plant and equipment valuation adjustments, gains from
insurance settlements, acquisition and integration expense
activities including retention, legal, accounting, banking,
amortization and contingent earn-out expenses, foreign currency
re-measurement, intangible asset impairment, legal reserves,
executive transition expenses, facility exit expenses,
restructuring expenses, other nonrecurring or infrequent items and
the associated tax benefit of these items. Management believes that
these items are not necessarily indicative of the Company's ongoing
operations and their exclusion provides individuals with additional
information to compare the Company's results over multiple
periods. Management utilizes this information to evaluate its
ongoing financial performance. Our financial statements may
continue to be affected by items similar to those excluded in the
non-GAAP adjustments described above, and exclusion of these items
from our non-GAAP financial measures should not be construed as an
inference that all such costs are unusual or infrequent.
Non-GAAP gross profit, non-GAAP operating income, non-GAAP net
income, non-GAAP gross profit margin, non-GAAP operating margin,
non-GAAP earnings per basic and diluted share and adjusted EBITDA
are not calculated in accordance with GAAP, and should be
considered supplemental to, and not as a substitute for, or
superior to, financial measures calculated in accordance with GAAP.
Non-GAAP financial measures have limitations in that they do not
reflect all of the costs associated with the operations of our
business as determined in accordance with GAAP. As a result, you
should not consider these measures in isolation or as a substitute
for analysis of CECO's results as reported under GAAP.
Additionally, CECO cautions investors that non-GAAP financial
measures used by the Company may not be comparable to similarly
titles measures of other companies.
In accordance with the requirements of Regulation G issued by
the Securities and Exchange Commission, non-GAAP gross profit,
non-GAAP operating income, non-GAAP net income, non-GAAP gross
profit margin, non-GAAP operating margin, non-GAAP earnings per
basic and diluted share and adjusted EBITDA stated in the tables
above present the most directly comparable GAAP financial measure
and reconcile to the most directly comparable GAAP financial
measures.
SAFE HARBOR
Any statements contained in this Press Release, other than
statements of historical fact, including statements about
management's beliefs and expectations, are forward-looking
statements and should be evaluated as such. These statements are
made on the basis of management's views and assumptions regarding
future events and business performance. We use words such as
"believe," "expect," "anticipate," "intends," "estimate,"
"forecast," "project," "will," "plan," "should" and similar
expressions to identify forward-looking statements. Forward-looking
statements involve risks and uncertainties that may cause actual
results to differ materially from any future results, performance
or achievements expressed or implied by such statements. Potential
risks and uncertainties, among others, that could cause actual
results to differ materially are discussed under "Part I – Item 1A.
Risk Factors" of the Company's Annual Report on Form 10-K and
include, but are not limited to: our ability to successfully
realize the expected benefits of our restructuring program; our
ability to successfully integrate acquired businesses and realize
the synergies from acquisitions, as well as a number of factors
related to our business, including economic and financial market
conditions generally and economic conditions in CECO's service
areas; dependence on fixed price contracts and the risks associated
therewith, including actual costs exceeding estimates and method of
accounting for contract revenue; fluctuations in operating results
from period to period due to cyclicality or seasonality of the
business; the effect of growth on CECO's infrastructure, resources,
and existing sales; the ability to expand operations in both new
and existing markets; the potential for contract delay or
cancellation; liabilities arising from faulty services or products
that could result in significant professional or product liability,
warranty, or other claims; changes in or developments with respect
to any litigation or investigation; failure to meet timely
completion or performance standards that could result in higher
cost and reduced profits or, in some cases, losses on projects; the
potential for fluctuations in prices for manufactured components
and raw materials; the substantial amount of debt incurred in
connection with our acquisitions and our ability to repay or
refinance it or incur additional debt in the future; the impact of
federal, state or local government regulations; economic and
political conditions generally; and the effect of competition in
the environmental, energy and fluid handling and filtration
industries. Many of these risks are beyond management's ability to
control or predict. Should one or more of these risks or
uncertainties materialize, or should the assumptions prove
incorrect, actual results may vary in material aspects from those
currently anticipated. Investors are cautioned not to place undue
reliance on such forward-looking statements as they speak only to
our views as of the date the statement is made. Furthermore,
forward-looking statements speak only as of the date they are made.
Except as required under the federal securities laws or the rules
and regulations of the Securities and Exchange Commission, we
undertake no obligation to update or review any forward-looking
statements, whether as a result of new information, future events
or otherwise.
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SOURCE CECO Environmental Corp.