HOUSTON, Nov. 29, 2001 (PRIMEZONE) -- KMG Chemicals, Inc. (Nasdaq:KMGB), a global provider of specialty chemicals in carefully focused markets, today announced its unaudited financial results for the first fiscal 2002 quarter ended October 31, 2001.
For the first fiscal 2002 quarter, net income was $0.42 million or $0.06 per diluted share, down from $0.95 million or $.12 per diluted share reported for the same quarter in 2001. Fiscal first quarter net sales were $8.1 million, down 2.5 percent from $8.3 million in the year earlier period.
At the end of the first fiscal 2002 quarter, KMG had total assets of $25.8 million and long-term debt of $1.4 million. Long-term debt to total assets has been decreasing annually from 26.2 percent at fiscal year-end 1998, and was 5.3 percent on October 31, 2001. The company had approximately $3.2 million of cash and cash equivalents at October 31, 2001.
David Hatcher, chief executive officer and president of KMG Chemicals, said, "We continue to maintain strong and profitable positions in stable markets, in spite of the current recessionary environment. Our MSMA (agricultural herbicide) plant in Matamoros was recently completed and is producing product. Sales of our Bueno(r) 6 herbicide should contribute significantly to profitability during the upcoming spring selling season to the domestic cotton-growing markets, which straddles our third and fourth fiscal quarters. Agricultural chemical sales tend to be much more seasonal, so our new MSMA product line will cause our earnings to be skewed toward the second half of our fiscal year. However, based on our existing business, we are well positioned to achieve an increase in earnings for fiscal 2002 compared to the 2001 fiscal year of $.35 per share. Our current earnings per share estimate for the second quarter of fiscal 2002 is in the range of $.04 to $.05.
"We have made significant progress in implementing our new merger and acquisition initiative," Hatcher concluded. "To give this perspective, since the beginning of our fiscal year on August 1, we have evaluated over 20 potential acquisition candidates, and are currently pursuing a select number of those. Our strong balance sheet, healthy cash position and experienced management team will give us an edge in closing accretive acquisitions."
KMG Chemicals, Inc.
Selected Financial Data
(UNAUDITED, and in thousands, except share data)
Three months ended October 31,
2001 2000
Net sales $8,097 $8,302
Gross profit 2,636 3,147
Income before income tax 683 1,531
Net income 423 949
EBITDA 992 1,733
Earnings per diluted share
(restated for stock dividend) 0.06 0.12
Weighted average diluted shares
outstanding
(restated for stock dividend) 7,545 7,702
KMG Chemicals, Inc., through its subsidiaries, produces and distributes specialty chemicals to carefully focused markets. The company grows by acquiring and managing stable chemical product lines and businesses with established production processes. Its wholly owned subsidiary, KMG Bernuth, Inc. is a global provider of wood preservation chemicals to the lumber treatment industry and herbicides to the agricultural industry. For more information, visit the company's Web site at www.kmgchemicals.com.
The information in this news release includes certain forward-looking statements that are based upon assumptions that in the future may prove not to have been accurate and are subject to significant risks and uncertainties, including statements as to the future performance of the company. Although the company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations or any of its forward-looking statements will prove to be correct. Factors that could cause results to differ include, but are not limited to, successful performance of internal plans, product development acceptance, the impact of competitive services and pricing and general economic risks and uncertainties.