MOCON, Inc. (NASDAQ:MOCO) today reported sales of $14.2 million for the third quarter ended September 30, 2013, an increase of 15 percent compared to $12.3 million for the same quarter in 2012. Net income for the third quarter was $1.4 million, or $0.24 per diluted share, compared to $493,000 or $0.09 per diluted share, in the third quarter of 2012. Nine-month sales totaled $42.3 million, an increase of 22 percent compared to $34.7 million during the first nine months of 2012. Net income and diluted earnings per share were $3.0 million and $0.53, respectively, for the first nine months of 2013, compared to $1.2 million and $0.21 for the same period in 2012. Year-to-date amounts for 2012 included only six months of Dansensor’s results, which was acquired in April 2012.
“We are encouraged by the fact that we recorded strong top- and bottom-line growth for the third quarter. International shipments rose 21 percent for the quarter with Europe and Asia both recording strong growth. We believe we are on track to continue to improve company-wide profitability as our gross margins improved by two percentage points and net income for the quarter was nearly 10 percent of sales,” said Robert L. Demorest, MOCON President and CEO. “MOCON serves promising end markets, has a broader base of growth drivers than ever before, is improving its ability to serve emerging markets, and is working hard to realize new efficiencies. We believe this is a solid platform for generating shareholder value.”
The Company experienced sales growth for the current quarter over the same period in 2012 in all three major product segments, as global economic conditions improved, increasing our customer’s ability to make capital equipment purchases. Sales in our Permeation group increased 20 percent, as customers who previously utilized our laboratory facilities for their testing requirements can now justify the purchase of their own equipment. Sales in our Package Testing group increased 14 percent, as shipments of our headspace analyzers and gas mixers improved, primarily in our European market. Sales in our Industrial Analyzer group increased 8 percent, due mainly to strong shipments of OEM sensors and detectors for use in instruments that detect volatile organic compounds in the environment.
The company-wide gross margin was 57 percent in the third quarter 2013 compared to 55 percent in the same period in 2012. The current period improvement was due primarily to increased sales of higher margin permeation instruments, and a shift in product mix within the Package Testing group, which in the prior year included a large order for leak detection instruments with a reduced margin. Selling, general and administrative expenses in the current quarter are slightly higher compared to the same period last year primarily due to higher wage and benefit costs and contract labor costs related to the implementation of the new ERP system. Our effective tax rate of 25 percent in the current quarter was slightly lower than the statutory rate due to certain discrete adjustments recorded during the quarter.
MOCON is a leading provider of detectors, instruments, systems and consulting services to research laboratories, production facilities, and quality control and safety departments in the medical, pharmaceutical, food and beverage, packaging, environmental, oil and gas and other industries worldwide. See www.mocon.com for more information.
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements that can be identified by words such as “will,” “may,” “expect,” “believe,” “anticipate,” “estimate,” “continue,” or other similar expressions. All forward-looking statements speak only as of the date of this press release. MOCON undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. In addition to the risks and uncertainties of ordinary business operations and conditions in the general economy and the markets in which the company competes, there are important factors that could cause actual results to differ materially from those anticipated by the forward-looking statements made in this press release. These factors include, but are not limited to, the integration and performance of Dansensor, the ability to successfully upgrade our ERP system, the terms of our credit agreement including financial covenants included therein, competition and technological change, setbacks in product development programs, order cancellations, dependence on certain key industries, and other factors set forth in the company’s Annual Report on Form 10-K for the year ended December 31, 2012 and other documents MOCON files with or furnishes to the Securities and Exchange Commission.
MOCON's shares are traded on the NASDAQ Global Market System under
the symbol MOCO.
MOCON is a registered trademark of MOCON, Inc.; other trademarks are those of their respective holders.
|SUMMARY CONSOLIDATED FINANCIAL DATA|
|(in Thousands, Except Per Share Data)|
INCOME STATEMENT DATA: (unaudited)
|Quarters Ended September 30,||Nine Months Ended September 30,|
|Cost of sales|
|Total cost of sales||6,131||5,593||18,632||15,833|
|Selling, general and administrative expenses||5,258||5,104||16,529||14,482|
|Research and development expenses||886||844||3,084||2,610|
|Other income (expense), net||(95||)||(25||)||(286||)||117|
|Income before income taxes||1,820||740||3,794||1,881|
|Net income per common share:|
|Weighted average common shares outstanding:|
BALANCE SHEET DATA: (unaudited)
|September 30, 2013||December 31, 2012|
|Cash and marketable securities||$||4,946||$||7,911|
|Accounts receivable, net||11,409||10,652|
|Other current assets||2,667||2,005|
|Total current assets||26,024||26,913|
|Marketable securities, noncurrent||--||210|
|Property, plant and equipment, net||5,739||5,350|
|Investment in affiliated company||3,380||3,304|
|Goodwill, intangibles and other assets||21,915||21,443|
|Liabilities and Stockholders’ Equity:|
|Revolving lines of credit||
|Notes payable, current||2,625||2,566|
|Other current liabilities||10,282||8,600|
|Total noncurrent liabilities||5,204||6,845|
Total liabilities and stockholders’ equity
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