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ProSep Inc, Canada
COMPANY WATCH
MFRI Inc, USA
ProSep Inc, Canada
Key Figures (US$ million) Third quarter ended 31.10 2011 Net Sales Of Which: Filtration Products Gross Profit Of Which: Filtration Products
Key Figures (C$ thousand) Third quarter ended 30.9 2011
2010
Revenues
6857.5
8140.1
Cost of Sales
4664.4
6174.2
Gross Profit
2193.1
1965.9
243.7
35.4
2010
71.3
58.8
24.0
21.2
12.4
13.6
R&D Expenses 3.4
2.9
Operating Income/(Loss)
(2599.3)
(1168.1)
Income from Operations Of Which: Filtration Products
2.2
3.0
Net Profit/(Loss)
(2516.6)
(1517.5)
0.3
0.1
Net Income
0.7
3.6
Nine months ended 30.9 2011
2010
Revenues
26 358.9
26 200.8
2010
Cost of Sales
19 769.4
19 085.3
Gross Profit
6589.5
7115.5
Nine months ended 31.10 2011 Net Sales Of Which: Filtration Products
188.7
170.6
74.1
61.3
Gross Profit Of Which: Filtration Products
31.5
38.1
Income from Operations Of Which: Filtration Products Net Income/(Loss)
R&D Expenses
10.3
8.0
0.7
5.7
1.3
(1.0)
(2.6)
6.0
403.0
187.3
Operating Income/(Loss)
(7647.0)
(2849.9)
Net Profit/(Loss)
(7907.2)
(3110.5)
COMMENT COMMENT MFRI has posted third quarter sales of US$71.3 million, up 21.3% on a year earlier. Net income, however, was down 80.8% at US$0.7 million due to lower sales and profits in its Piping Systems division. The company’s Filtration Products segment saw net sales up 17.1% on the year earlier at US$24.0 million and its gross profit lift 17.1% to US$3.4 million, while its income from operations was 162.5% higher at US$0.3 million. “The third quarter again delivered year over year improvement in our filtration and industrial process cooling segments,” Brad Mautner, MFRI’s president and COO, said. “Our piping systems business saw an absence of large project revenue from international activities and the
January 2012
continued prolonged downturn in the Dubai district cooling market. These factors, coupled with ramp up costs for the Saudi and India markets, drive a very weak 2011.” For the corresponding nine months, MFRI’s net sales were up 10.6% at US$188.7 million, while it posted a net loss of US$2.6 million compared to net income of US$6.0 million in the prior year. The loss was driven by the slowdown in its Piping Systems division and a one-time US$1.8 million discrete tax expense from the repatriation of foreign earnings. The company’s Filtration Products segment saw sales for the period rise 20.9% to US$74.1 million and gross profit lift 28.4% to US$10.3 million. ■ www.mfri.com
Process equipment manufacturer ProSep saw third quarter fiscal 2011 sales dip 15.8% on the year earlier to C$6.9 million. The net loss for the period was C$2.5 million compared with a net loss of C$1.5 million for the comparator quarter of 2010. For the corresponding nine months, revenues were up marginally on a year earlier at C$26.4 million, while a net loss of C$7.9 million was recorded against the previous year deficit of C$3.1 million. Despite the challenges, ProSep’s president and CEO Jacques Drouin said the company had made progress during the period. “ProSep achieved significant milestones during the quarter,” Drouin said. “We’ve completed our organizational changes, expanded our offering and strengthened our market
reach. With the conclusion of an important equity financing, we now have all elements in place to deliver stronger results and achieve profitability.” Drouin said the company had also agreed a number of significant orders, with C$2.8 million signed in the third quarter and a further C$11.7 million during the first weeks of the fourth quarter. “These are the first tangible results of our new strategy,” he said. “As we focus on accelerating commercialization of our proprietary technologies and continue building strong references, we expect to see significant backlog growth in the current quarter and into 2012.” Among the new orders was a C$6.5 million deal for its largest offshore produced water treatment system for installation in South East Asia. ■ www.prosep.com
Filtration Industry Analyst
11
MFRI Inc, USA
ProSep Inc, Canada
Key Figures (US$ million) Third quarter ended 31.10 2011 Net Sales Of Which: Filtration Products Gross Profit Of Which: Filtration Products
Key Figures (C$ thousand) Third quarter ended 30.9 2011
2010
Revenues
6857.5
8140.1
Cost of Sales
4664.4
6174.2
Gross Profit
2193.1
1965.9
243.7
35.4
2010
71.3
58.8
24.0
21.2
12.4
13.6
R&D Expenses 3.4
2.9
Operating Income/(Loss)
(2599.3)
(1168.1)
Income from Operations Of Which: Filtration Products
2.2
3.0
Net Profit/(Loss)
(2516.6)
(1517.5)
0.3
0.1
Net Income
0.7
3.6
Nine months ended 30.9 2011
2010
Revenues
26 358.9
26 200.8
2010
Cost of Sales
19 769.4
19 085.3
Gross Profit
6589.5
7115.5
Nine months ended 31.10 2011 Net Sales Of Which: Filtration Products
188.7
170.6
74.1
61.3
Gross Profit Of Which: Filtration Products
31.5
38.1
Income from Operations Of Which: Filtration Products Net Income/(Loss)
R&D Expenses
10.3
8.0
0.7
5.7
1.3
(1.0)
(2.6)
6.0
403.0
187.3
Operating Income/(Loss)
(7647.0)
(2849.9)
Net Profit/(Loss)
(7907.2)
(3110.5)
COMMENT COMMENT MFRI has posted third quarter sales of US$71.3 million, up 21.3% on a year earlier. Net income, however, was down 80.8% at US$0.7 million due to lower sales and profits in its Piping Systems division. The company’s Filtration Products segment saw net sales up 17.1% on the year earlier at US$24.0 million and its gross profit lift 17.1% to US$3.4 million, while its income from operations was 162.5% higher at US$0.3 million. “The third quarter again delivered year over year improvement in our filtration and industrial process cooling segments,” Brad Mautner, MFRI’s president and COO, said. “Our piping systems business saw an absence of large project revenue from international activities and the
January 2012
continued prolonged downturn in the Dubai district cooling market. These factors, coupled with ramp up costs for the Saudi and India markets, drive a very weak 2011.” For the corresponding nine months, MFRI’s net sales were up 10.6% at US$188.7 million, while it posted a net loss of US$2.6 million compared to net income of US$6.0 million in the prior year. The loss was driven by the slowdown in its Piping Systems division and a one-time US$1.8 million discrete tax expense from the repatriation of foreign earnings. The company’s Filtration Products segment saw sales for the period rise 20.9% to US$74.1 million and gross profit lift 28.4% to US$10.3 million. ■ www.mfri.com
Process equipment manufacturer ProSep saw third quarter fiscal 2011 sales dip 15.8% on the year earlier to C$6.9 million. The net loss for the period was C$2.5 million compared with a net loss of C$1.5 million for the comparator quarter of 2010. For the corresponding nine months, revenues were up marginally on a year earlier at C$26.4 million, while a net loss of C$7.9 million was recorded against the previous year deficit of C$3.1 million. Despite the challenges, ProSep’s president and CEO Jacques Drouin said the company had made progress during the period. “ProSep achieved significant milestones during the quarter,” Drouin said. “We’ve completed our organizational changes, expanded our offering and strengthened our market
reach. With the conclusion of an important equity financing, we now have all elements in place to deliver stronger results and achieve profitability.” Drouin said the company had also agreed a number of significant orders, with C$2.8 million signed in the third quarter and a further C$11.7 million during the first weeks of the fourth quarter. “These are the first tangible results of our new strategy,” he said. “As we focus on accelerating commercialization of our proprietary technologies and continue building strong references, we expect to see significant backlog growth in the current quarter and into 2012.” Among the new orders was a C$6.5 million deal for its largest offshore produced water treatment system for installation in South East Asia. ■ www.prosep.com
Filtration Industry Analyst
11