HOUSTON, Jan. 27, 2011 /PRNewswire/ -- CARBO Ceramics Inc.
(NYSE: CRR) today reported net income of $20.8 million, or $0.90 per diluted share, on revenues of
$119.6 million for the quarter ended
December 31, 2010.
President and CEO Gary Kolstad
commented, "We finished 2010 on a high note with another quarter of
solid financial and operational performance. Exiting the
third quarter, we witnessed continued momentum in proppant sales.
The uptick in horizontal fracturing in oil bearing reservoirs,
coupled with our traditionally strong footprint in gas driven
plays, caused sales volume resilience in a quarter that
historically shows seasonal weakness. Our plants continued to
operate at high utilization levels, aiding our ability to meet the
challenging demands of our clients. We successfully commenced
operations of our third 250 million pound production line at our
Toomsboro, Georgia facility. We
are excited about completing this third line and also look forward
to completing the previously announced fourth line by year end.
We continue to build upon the Falcon Technologies™ footprint
in the resource plays and are pleased with the overall growth that
Falcon is exhibiting."
"During the fourth quarter, we introduced and sold our first
Resin Coated Sand (RCS) proppant, CARBOBOND® RCS. We continue
to listen to our clients' needs and the addition of CARBOBOND® RCS to our product
offering is our latest response to those needs. We believe
this is a natural extension of our core business and fits well in
the Economic Conductivity® equation. We look forward
to providing these additional products to meet our clients'
proppant demands," Mr. Kolstad stated.
Fourth Quarter Results
Revenues for the fourth quarter of 2010 increased 33 percent, or
$29.5 million, when compared to the
fourth quarter of 2009. The Company's worldwide proppant
sales volume totaled 332 million pounds for the fourth quarter of
2010 and represents a year-over-year increase of 20 percent.
North American (excludes Mexico) and international proppant sales
volume increased 17 percent and 37 percent, respectively, compared
to the same period last year.
Operating profit for the fourth quarter of 2010 increased 61
percent, or $11.6 million, compared
to the fourth quarter of 2009. This increase is due to higher
sales volume and an increase in the average proppant selling price,
partially offset by an increase in selling, general, administrative
and other operating expenses.
Net income for the fourth quarter of 2010 increased 65 percent,
or $8.2 million, compared to the
fourth quarter of 2009.
Full Year Results
For the year ended December 31,
2010, revenues increased 38 percent compared to 2009.
The increase is mainly attributed to the increase in proppant
sales volume, an increase in the average proppant selling price
compared to 2009, and an increase in the sales volume of Falcon
Technologies acquired in October
2009.
CARBO's worldwide proppant
sales volume totaled 1.35 billion pounds for the full year 2010, an
increase of 29 percent compared to 2009. Sales volume in
North America increased 29 percent
primarily due to increases in both U.S. and Canada sales volume. International sales
volume increased 31 percent primarily due to increases in
Russia, China, Latin
America and Europe/Africa/Middle
East, partially offset by a decrease in Mexico.
Full year net income for 2010 increased 49 percent, or
$25.9 million, compared to 2009.
Technology and Business Highlights
- CARBO's proppant
continues to be deployed in an increasing amount across the oily,
liquid-rich plays in North America
as operators realize the benefits of increased production and
higher EURs through the utilization of our highly conductive
proppant.
- Toomsboro Line 3 commenced production as scheduled in the
fourth quarter. This proppant was deployed into several North
American resource plays.
- CARBOBOND®
LITE®, a resin-coated ceramic proppant, witnessed sequential
volume growth during the fourth quarter and continues to receive
positive performance feedback.
- CARBOBOND®
RCS, a resin-coated sand proppant, was introduced during the
fourth quarter and has garnered immediate interest from many of our
clients.
- Several of our clients were able to demonstrate their
commitment to environmental stewardship around the world by
employing CARBONRT™,
a non-radioactive, environmentally responsible, traceable ceramic
proppant.
- In December, version 10.5 of Fracpro® was released
focusing on horizontal wellbores encompassing multiple fracture
treatment completions. New features in this version allow for
better visualization of horizontal multi-stage wells.
- StrataGen® Engineering expanded its Data and
Neural Analysis(SM) offering to include prospect analysis.
Currently being utilized by several operators in the Bakken
and evaluated for other resource plays in North America, Data and Neural Analysis(SM)
facilitates better completion/frac decision-making.
Outlook
CEO Gary Kolstad commented on the
outlook for the Company stating, "Industry activity levels remain
high, even with the economic challenges of low natural gas prices.
We continue to see a shift in activity to oily, liquid-rich
plays which gives us confidence that the operating environment for
our proppant business will remain favorable as we move through
2011."
"We continue to see capacity expansions playing a key role in
CARBO's long-term growth.
Our entrance into the RCS market will allow us to serve a
broader spectrum of our clients' proppant requests. We have
started site preparation for a second resin coating line at our
New Iberia facility in
Louisiana. Once completed,
our current resin coating capacity will increase from 100 million
pounds to 400 million pounds annually. Ultimately, we see
CARBO playing a significant role
in the RCS proppant market as we execute our growth plans over the
next several years. In addition to the Line 2 expansion at
our New Iberia facility, we
purchased a facility in Marshfield,
Wisconsin during the fourth quarter and are evaluating the
site's prospective RCS role. On the ceramic proppant capacity
expansion, Toomsboro Line 4 is still on schedule to start
production before the end of 2011. The outlook for our Falcon
Technologies business remains positive and we will continue our
efforts to grow the business to further reduce the environmental
risks that our clients' face today."
"2010 marked the best year in CARBO's history. Going forward, we'll
continue to focus on what we do best, increasing well production by
incorporating Economic Conductivity® in our clients' oil and
gas wells. The industry's acknowledgement of the importance
of increased conductivity in the lower permeability resource plays
has never been greater, as shown by the operators' improved
production when using high quality ceramic proppant."
"It is this focused attention to both the production enhancement
and environmental risk reduction aspects of our clients' businesses
that we believe will add shareholder value over the long-term."
Kolstad concluded.
As previously announced, a conference call to discuss the
Company's fourth quarter results is scheduled for today at
10:00 a.m. Central Time (11:00 a.m. Eastern). To participate in the
teleconference, investors should dial 1-877-317-6789 about 10
minutes before the start time and reference the CARBO conference call. Canada-based
callers should dial 1-866-605-3852 and international callers should
dial 1-412-317-6789. The conference call can also be accessed by
visiting the company's Web site,
www.carboceramics.com.
CARBO is the world's largest
supplier of ceramic proppant for fracturing oil and gas wells; the
provider of the industry's most popular fracture simulation
software; and a provider of fracture design and consulting
services. The Company also provides a broad range of technologies
for spill prevention, containment and countermeasures, along with
geotechnical monitoring.
The statements in this news release that are not historical
statements, including statements regarding our future financial and
operating performance, are forward-looking statements within the
meaning of the federal securities laws, including the Private
Securities Litigation Reform Act of 1995. All forward-looking
statements are based on management's current expectations and
estimates, which involve risks and uncertainties that could cause
actual results to differ materially from those expressed in
forward-looking statements. Among these factors are changes
in overall economic conditions, changes in the cost of raw
materials and natural gas used in manufacturing our products,
changes in demand and prices charged for our products, changes in
the demand for, or price of, oil and natural gas, risks of
increased competition, technological, manufacturing and product
development risks, loss of key customers, changes in government
regulations, foreign and domestic political and legislative risks,
the risks of war and international and domestic terrorism, risks
associated with foreign operations and foreign currency exchange
rates and controls, weather-related risks and other risks and
uncertainties described in our publicly available filings with the
Securities and Exchange Commission. We assume no obligation
to update forward-looking statements, except as required by
law.
- tables follow -
|
|
|
Three Months
Ended
December
31
|
Twelve
Months Ended
December
31
|
|
|
____2010____
|
____2009____
|
____2010____
|
____2009____
|
|
|
(In
thousands except per share data)
|
(In
thousands except per share data)
|
|
Revenues
|
$ 119,584
|
$
90,125
|
$
473,082
|
$
341,872
|
|
Cost of sales
|
73,218
|
61,069
|
298,411
|
221,369
|
|
Gross profit
|
46,366
|
29,056
|
174,671
|
120,503
|
|
Selling, general &
administrative expenses
|
13,903
|
9,815
|
52,635
|
40,897
|
|
Start-up costs
|
356
|
-
|
977
|
-
|
|
Loss on disposal or
impairment of assets
|
1,245
|
28
|
1,449
|
156
|
|
Operating profit
|
30,862
|
19,213
|
119,610
|
79,450
|
|
Interest income, net
|
47
|
53
|
178
|
451
|
|
Foreign currency exchange (loss)
gain, net
|
(46)
|
24
|
(96)
|
(192)
|
|
Other (expense) income,
net
|
(35)
|
(43)
|
(343)
|
85
|
|
Income before income
taxes
|
30,828
|
19,247
|
119,349
|
79,794
|
|
Income taxes
|
10,013
|
6,654
|
40,633
|
26,984
|
|
Net income
|
$
20,815
|
$
12,593
|
$
78,716
|
$
52,810
|
|
|
|
|
|
Earnings per share:
|
|
|
|
|
|
Basic
|
$
0.90
|
$
0.55
|
$
3.41
|
$
2.27
|
|
Diluted
|
$
0.90
|
$
0.55
|
$
3.40
|
$
2.27
|
|
|
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
|
|
Basic
|
22,972
|
22,930
|
22,969
|
23,097
|
|
Diluted
|
22,979
|
22,940
|
22,977
|
23,112
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
$
7,420
|
$
6,611
|
$
27,728
|
$
24,905
|
|
|
|
|
|
|
|
|
Selected Balance Sheet
Information
|
|
|
|
|
December 31,
2010
|
|
December 31,
2009
|
|
|
(In
thousands)
|
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
$
46,656
|
|
$
69,557
|
|
Other current
assets
|
190,999
|
|
149,313
|
|
Property, plant and
equipment, net
|
338,483
|
|
270,722
|
|
Intangible and other
assets, net
|
10,380
|
|
10,104
|
|
Total assets
|
599,571
|
|
513,412
|
|
|
|
|
|
|
Liabilities and Shareholders'
Equity
|
|
|
|
|
Accrued income
taxes
|
$
113
|
|
$
3,609
|
|
Other current
liabilities
|
51,134
|
|
28,849
|
|
Deferred income
taxes
|
26,345
|
|
23,638
|
|
Shareholders'
equity
|
521,979
|
|
457,316
|
|
Total liabilities and
shareholders' equity
|
$
599,571
|
|
$
513,412
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE CARBO Ceramics Inc.