American Ecology Posts Record Operating Income of $7.5 Million in Second Quarter; All Four Operating Facilities Continue Strong Financial Performance.BOISE, Idaho “Boise” redirects here. For other uses, see Boise (disambiguation). Boise is the capital and most populous city of the U.S. state of Idaho. It is the county seat of Ada County and the principal city of the Boise metropolitan area. -- Third graph, first sentence should read: Revenue for the second quarter of 2006 increased 59 percent to $29.9 million, up from $18.8 million a year ago. (Sted: Revenue for the second quarter of 2006 increased 96 percent to $29.9 million, up from $18.8 million a year ago.) The corrected release reads: AMERICAN American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of ECOLOGY ecology, study of the relationships of organisms to their physical environment and to one another. The study of an individual organism or a single species is termed autecology; the study of groups of organisms is called synecology. POSTS RECORD OPERATING INCOME Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. OF $7.5 MILLION IN SECOND QUARTER; ALL FOUR OPERATING FACILITIES CONTINUE STRONG FINANCIAL American Ecology Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ECOL ECOL es.comp.os.linux.* (newsgroups) ECOL Emmanuel Church of Lakewood (San Francisco, CA) ) today announced net income of $4.9 million, or $.27 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, for the quarter ended June June: see month. 30, 2006 compared to net income of $3.7 million, or $.21 per diluted share, in the second quarter of 2005. Second Quarter Results Operating income was $7.5 million for the quarter, 27 percent higher than operating income of $5.9 million posted in the second quarter of 2005 and $58,000 higher than the previous record quarter of $7.4 million posted by American Ecology in the fourth quarter of 1992. All four operating facilities were profitable for the quarter. Revenue for the second quarter of 2006 increased 59 percent to $29.9 million, up from $18.8 million a year ago. This improvement reflects a 6 percent increase in average selling price The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. , a two percent increase in the volume of waste disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. at the Company's hazardous waste Hazardous waste Any solid, liquid, or gaseous waste materials that, if improperly managed or disposed of, may pose substantial hazards to human health and the environment. Every industrial country in the world has had problems with managing hazardous wastes. facilities in Idaho Idaho (ī`dəhō), one of the Rocky Mt. states in the NW United States. It is bordered by Montana and Wyoming (E), Utah and Nevada (S), Oregon and Washington (W), and the Canadian province of British Columbia (N). , Nevada Nevada (nəvăd`ə, –vä–), far western state of the United States. It is bordered by Utah (E), Arizona (SE), California (SW, W), and Oregon and Idaho (N). and Texas and an increase in rail transportation and disposal services. "Our record quarterly financial performance was driven by strong operating results at all four American Ecology disposal facilities," stated Stephen Stephen, 1097?–1154, king of England (1135–54). The son of Stephen, count of Blois and Chartres, and Adela, daughter of William I of England, he was brought up by his uncle, Henry I of England, who presented him with estates in England and France and Romano Ro·ma·no n. A hard, sharp, dry cheese of Italian origin that is made from cow's milk and usually served grated as a garnish. [Italian, short for (pecorino) romano, Roman (sheep's milk cheese) , President and Chief Executive Officer. "We are particularly pleased with the growth at our Nevada and Texas facilities, which both made significant contributions during the second quarter," Romano noted. Other direct operating costs operating costs npl → gastos mpl operacionales for the quarter increased to $7.9 million, up from $5.7 million in the second quarter of 2005. This reflected increased labor and waste treatment additive additive In foods, any of various chemical substances added to produce desirable effects. Additives include such substances as artificial or natural colourings and flavourings; stabilizers, emulsifiers, and thickeners; preservatives and humectants (moisture-retainers); and costs to handle increased waste throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. and treatment volumes. The Company continues to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. higher costs for its railcar fleet as well as project-specific railroad railroad or railway, form of transportation most commonly consisting of steel rails, called tracks, on which freight cars, passenger cars, and other rolling stock are drawn by one locomotive or more. charges. Due to higher revenue, other direct operating costs declined to 27 percent of revenue in the second quarter of 2006 down from 31 percent a year ago. Higher railcar utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be helped push gross profit from $9.2 million, or 49 percent of revenue, in the second quarter of 2005 to $10.5 million, or 35 percent of revenue, in the second quarter of 2006. Shipments from the Honeywell In 1927, the Minneapolis Honeywell Regulator Company was formed as a merger of Alfred Butz' temperature control company (1885) and Mark Honeywell's water heater company (1906). In 1957, Honeywell, along with Ratheon, introduced one of the first computers in the U.S., the Datamatic 1000. , New Jersey project resumed in April 2006 in compliance with a court order and have continued as scheduled since then. Selling, general & administrative expenses (SG&A) for the second quarter of 2006 were $3.1 million, or 10 percent of revenue. This compared to SG&A of $3.4 million, or 18 percent of revenue, in the second quarter last year. At quarter end the Company had $10.8 million of cash and investments and $25.5 million of working capital. The Company's $15 million line of credit was unused at quarter end. Year-to-Date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. Results Revenue for the six months ended June 30, 2006 reached $51.4 million, up 64 percent from the first six months of 2005. Year-to-date waste volumes increased 18 percent over 2005 with the majority of this increase occurring during the first quarter of 2006. The increase in revenue was substantially due to increased rail transportation services provided to Honeywell and other customers. Operating income rose to $13.7 million, up 89 percent from the $7.2 million posted for the same period last year. For the first six months of 2006, the Company reported net income of $9.1 million, or $.50 per diluted share compared to net income of $4.6 million, or $.26 per diluted share for the first half of 2005. Outlook for 2006 The Company continues to project that net earnings for 2006 will be in the upper end of its previously announced guidance range of $0.72 to $0.82 per diluted share. Management expects softer third quarter financial performance due to pending completion of an event project shipping to its Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. facility as well as reduced waste shipments under the Company's multi-year contract with the U.S. Army Corps of Engineers. The expected reduction in Army Corps of Engineers work reflects delays in shipments from several ongoing remediation projects pending appropriation The designation by the government or an individual of the use to which a fund of money is to be applied. The selection and setting apart of privately owned land by the government for public use, such as a military reservation or public building. of funds for the next federal fiscal year. Management expects shipments from these ongoing projects to resume during the fourth quarter. Other Updates On July July: see month. 3, 2006, the Company declared a $0.15 per common share quarterly dividend for stockholders of record on July 14, 2006. This $2.7 million dividend will be paid using cash on hand on July 21, 2006. On July 3, 2006, the Company announced an approximately $6 million increase in its 2006 capital budget to $18 million to purchase approximately 80 additional railcars with cash. The new railcars will service existing rail transportation and disposal projects as well as recently awarded work expected to commence in the first quarter of 2007. On April 3, 2006, the Company self funded $4.5 million of non-operating disposal site closure and post-closure obligations, replacing the insurance policy which previously provided financial assurance for those sites. The insurance policy remains in effect, at a reduced premium, for financial assurance obligations at operating facilities. The Company's second quarter 2006 investor conference call will be held Wednesday Wednesday: see week. , July 19, 2006 at 9:00 am Mountain Time. President and Chief Executive Officer Stephen Romano, incoming Incoming is a 3-D shooter developed by Rage Software and published by Interplay. The PC version was released in late 1998, and the Dreamcast version, a launch title for the console, was released in 1998 in Japan and in 1999 in the rest of the world. Vice President and Controller Jeff Feeler, outgoing Vice President and Controller Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. Gilberg and Vice President of Sales and Marketing Steven Ste´ven n. 1. Voice; speech; language. Ye have as merry a steven As any angel hath that is in heaven. - Chaucer. 2. An outcry; a loud call; a clamor. To set steven to make an appointment. Welling will host the call. Interested parties are invited to submit questions in advance to info@americanecology.com, or by facsimile to 208-331-7900. To join the call, dial 866-261-3296. A replay will be available at http://www.americanecology.com/investor/INDEX.ASP asp, popular name for several species of viper, one of which, the European asp (Vipera aspis), is native to S Europe. It is also a name for the Egyptian cobra (Naja haja). following the call. American Ecology Corporation, through its subsidiaries, provides radioactive ra·di·o·ac·tive adj. Of or exhibiting radioactivity. radioactive characterized by radioactivity. radioactive decay , PCB PCB: see polychlorinated biphenyl. PCB in full polychlorinated biphenyl Any of a class of highly stable organic compounds prepared by the reaction of chlorine with biphenyl, a two-ring compound. , hazardous and non-hazardous waste services to commercial and government customers throughout the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , such as steel mills, medical and academic institutions, refineries and chemical manufacturing facilities, and the nuclear industry. Headquartered in Boise, Idaho, the Company is the nation's oldest radioactive and hazardous waste services provider, having operated for more than fifty years. This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are based on our current expectations, beliefs and assumptions about the industry and markets in which American Ecology Corporation and its subsidiaries operate. Actual results may differ materially from what is expressed herein and no assurance can be given that the Company will meet its 2006 earnings estimates, continue to receive material amounts of waste from the Honeywell New Jersey project, or declare or pay future dividends. For information on other factors that could cause actual results to differ from expectations, please refer to American Ecology Corporation's December December: see month. 31, 2005 Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and March 31, 2006 Quarterly Report filed with the Securities and Exchange Commission.
AMERICAN ECOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) ($ in 000's except per share amounts)
Three Months Six Months
Ended Ended
June 30, June 30,
2006 2005 2006 2005
--------------------------------
Revenue $29,924 $18,779 $51,446 $31,333
Transportation costs 11,459 3,823 16,516 7,036
Other direct operating costs 7,940 5,736 14,695 11,236
--------------------------------
Gross profit 10,525 9,220 20,235 13,061
Selling, general and administrative
expenses 3,061 3,358 6,544 5,872
Business interruption insurance claims -- -- -- (41)
--------------------------------
Operating income 7,464 5,862 13,691 7,230
Interest income 205 93 393 178
Interest expense 1 48 2 95
Other income 174 22 458 39
--------------------------------
Income before income tax 7,842 5,929 14,540 7,352
Income tax expense 2,915 2,223 5,434 2,790
--------------------------------
Net income $4,927 $3,706 $9,106 $4,562
================================
Basic earnings per share $.27 $.21 $.51 $.26
================================
Diluted earnings per share $.27 $.21 $.50 $.26
================================
Dividends paid per common share $.15 $ -- $.30 $ --
================================
AMERICAN ECOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
($ in 000's) (Unaudited)
June December
30, 31,
2006 2005
----------------
ASSETS
Current Assets:
Cash and cash equivalents $1,612 $3,641
Short-term investments 9,205 16,214
Receivables, net 21,845 13,573
Insurance receivable 157 157
Prepayments and other 3,727 3,183
Income tax receivable 1,351 1,248
Deferred income taxes 1,848 6,714
----------------
Total current assets 39,745 44,730
Property and equipment, net 48,700 40,896
Restricted cash 4,622 84
Other assets 501 738
Deferred income taxes 3,021 3,021
----------------
Total assets $96,589 $89,469
================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt $ 6 $ --
Accounts payable 3,270 3,665
Deferred revenue 3,360 1,261
State burial fees payable 1,635 1,454
Management incentive plan payable 870 1,272
Customer advances 1,912 1,535
Customer refunds 413 1,062
Accrued liabilities 1,807 1,337
Accrued closure and post closure obligation, current
portion 999 1,127
----------------
Total current liabilities 14,272 12,713
Long-term debt 27 --
Long-term accrued liabilities 549 485
Long-term customer advances 1,006 1,752
Accrued closure and post closure obligation, excluding
current portion 10,496 10,560
----------------
Total liabilities 26,350 25,510
----------------
Commitments and contingencies
Shareholders' equity:
Convertible preferred stock, 1,000,000 shares
authorized,
Common stock, $.01 par value, 50,000,000 authorized,
18,134,678 and 17,742,420 shares issued
and outstanding 181 177
Additional paid-in capital 55,758 53,213
Retained earnings 14,300 10,569
----------------
Total shareholders' equity 70,239 63,959
----------------
Total Liabilities and Shareholders' Equity $96,589 $89,469
================
AMERICAN ECOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, $ in 000's)
Six Months Ended
June 30,
2006 2005
---------------
Cash flows from operating activities:
Net income $9,106 $4,562
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation, amortization, and accretion 3,846 3,066
Income tax benefit on exercise of stock options 551 652
Deferred tax asset 4,866 2,135
Stock compensation 222 180
Changes in assets and liabilities:
Receivables (8,272)(4,673)
Other assets (225)(1,874)
Closure and post closure obligation (729) (460)
Income taxes payable/receivable (103) --
Accounts payable and accrued liabilities 999 2,256
---------------
Net cash provided by operating activities 10,261 5,844
Cash flows from investing activities:
Capital expenditures (11,081)(7,217)
Proceeds from sale of assets 4 749
Transfers from cash to restricted cash (4,622) --
Transfers to cash from short term investments, net 7,009 7
---------------
Net cash used by investing activities (8,690)(6,461)
Cash flows from financing activities:
Dividends paid (5,375) --
Payments of indebtedness (1) (728)
Stock options exercised 1,776 870
---------------
Net cash (used) provided by financing activities (3,600) 142
---------------
Decrease in cash and cash equivalents (2,029) (475)
Cash and cash equivalents at beginning of period 3,641 2,160
---------------
Cash and cash equivalents at end of period $1,612 $1,685
===============
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest $ 2 $ 95
Income taxes paid 103 4
Non-cash investing and financing activities:
Acquisition of equipment with notes/capital leases 34 --
Common stock dividends accrued -- 2,645
Common stock issued for director and employee
compensation 222 180
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