NEW YORK, March 26 /PRNewswire-FirstCall/ -- KHD Humboldt
Wedag International Ltd. (NYSE: KHD) today announced results for
the fourth quarter and year ended December
31, 2009. All dollar figures are in U.S. dollars.
Revenues in the fourth quarter of 2009 were $210.2 million, an increase of 41.8 percent
compared with the third quarter of 2009. Gross profit,
excluding the impact of terminated contracts, was $48.1 million, this was due to improved project
execution and the completion of several projects in the fourth
quarter. New order intake of $96.7
million in the fourth quarter showed improvement over the
third quarter of 2009 and was the highest quarterly new order
intake achieved in 2009 for the continuing cement operations.
For the year ended December 31,
2009, KHD reported revenues of $576.4
million with a net income of $40.7
million, or $1.34 per share on
a diluted basis, which included restructuring charges. This
compares to revenues in 2008 of $638.4
million and net loss for that period of $7.0 million, or a loss of $0.23 per share on a diluted basis. When taking
into account only revenues and cost of revenues, without
considering the effects of cancelled contracts, the gross profit
margin for the year ended December 31,
2009 was 20.6 percent as compared to 19.1 percent for the
same period in 2008. Considering the effect from cancelled
contracts, gross profit margin increased from 14.1 percent in 2008
to 23.7 percent in 2009. This improvement was due to improved
project execution and continuing success with finding alternative,
more cost effective, equipment procurement opportunities.
KHD's balance sheet remains strong. As of December 31, 2009, our cash and cash equivalents
increased to $420.6 million (as
compared to $409.1 million at the end
of 2008); working capital was $370.8
million (as compared to $279.9
million in 2008); and shareholders' equity was $319.8 million (as compared to $261.9 million at the end of 2008). KHD's current
ratio was 2.01 and its long-term debt-to-equity ratio was 0.04 as
of December 31, 2009.
New order intake is defined as the total value of all orders
received during the respective period, excluding cancelled
contracts, while order backlog is defined as the value of orders
received but not yet fulfilled.
New order intake in 2009 was $321.9
million. This was a decline of 55.5 percent from the
prior year. Of this total, 53 percent came from Asia, 22 percent came from Russia and Eastern
Europe, 10 percent came from Europe, 9 percent came from the Middle East, 5 percent from Africa and 1 percent from other regions. Of
the total new order intake for 2009, $273.6
million was from our cement customer group and $48.3 million was from our coal and minerals
business, which was sold in October, 2009.
Order backlog at the end of the year ended December 31, 2009 was $437.0 million, a decrease of 48.1 percent year
on year. This was primarily a result of the slowdown in new
order intake resulting from the general economic slowdown in 2009,
the removal from the order backlog of cancelled contracts amounting
to $110.2 million that were
previously classified as at risk as of December 31, 2008, as well as the removal of
$68.0 million of contracts from our
order backlog due to the sale of the coal and minerals
business.
CEO Jouni Salo commented,
"Overall market conditions were difficult during the year, although
there were strong pockets of activity in regions such as
India. In India, KHD had a
very successful year in terms of new order intake, approximately
half of our total new order intake for the year originated from
India. We were pleased to see new
order intake improve in the second half of the year. During the
year, we sold our coal and minerals operations and our workshop in
Cologne, and we completed the
first phase of our restructuring plan.
"We intend to continue to invest in improving our technology as
well as our offering of environmentally friendly products. This is
likely to be achieved through a combination of internal research
and development as well as through strategic partnerships. We are
currently involved in a number of discussions with potential
partners to strengthen our market position."
Mr. Salo concluded, "In January, we announced our intention to
split the company into two parts: a mineral royalty company and an
industrial plant technology, equipment and service company.
The first tranche of this transaction is expected to be
completed by the end of the first quarter of 2010. We
believe this will result in the two independent entities being well
positioned to create further value for our shareholders.
"We ended the year with renewed confidence and believe that we
have taken a number of significant steps towards helping our
customers produce cement and process minerals in a much more energy
efficient and environmentally friendly manner. This has been
a difficult year for our employees, with many changes over the
course of the year, and I would like to thank everyone for their
support during this period."
Shareholders are encouraged to read the entire Form 20-F, which
has been filed with the SEC, for a greater understanding of KHD.
The Form 20-F is also available on the Company's website.
About KHD Humboldt Wedag International Ltd.
KHD Humboldt Wedag International Ltd. ("KHD") (NYSE: KHD)
announced in the first quarter of 2010 that it intends to
restructure KHD into two distinct legal entities through the
distribution to KHD's shareholders, on a pro rata basis, of
approximately 26 percent of the shares of its subsidiary, KHD
Humboldt Wedag International (Deutschland) AG (the "Arrangement").
Assuming completion of the Arrangement, it is expected that KHD
will be split into a mineral royalty company and an industrial
plant technology, equipment and service company. To obtain further
information on the Company, please visit our website at
http://www.khdhumboldt.com
Disclaimer for Forward-Looking Information
Certain statements in this release are forward-looking
statements, which reflect the expectations of management regarding
the Company's future growth, results of operations, performance and
business prospects and opportunities. The worldwide
macroeconomic downturn has resulted in the prolonging or
cancellation of some of our customers' projects and may negatively
affect our customers' ability to make timely payment to us.
Further, it may result in a further decrease in the demand
for our products or services. Any of these may have a
material adverse effect on our operating results and financial
condition. Forward-looking statements consist of statements that
are not purely historical, including any statements regarding
beliefs, plans, expectations or intentions regarding the future.
No assurance can be given that any of the events anticipated
by the forward-looking statements will occur or, if they do occur,
what benefits the Company will obtain from them. These
forward-looking statements reflect management's current views and
are based on certain assumptions. These assumptions, which include
management's current expectations, estimates and assumptions about
certain projects and the markets the Company operates in, the
global economic environment, interest rates, exchange rates and our
ability to attract and retain customers and to manage our assets
and operating costs, may prove to be incorrect. A number of
risks and uncertainties could cause our actual results to differ
materially from those expressed or implied by the forward-looking
statements, including: (1) a continued downturn in general economic
conditions in Asia, Europe, Russia, the Middle
East, the United States and
otherwise internationally, including as a result of the worldwide
economic downturn resulting from the general credit market crises,
volatile energy costs, decreased consumer confidence and other
factors, (2) continuing decreased demand for our industrial plant
technology, equipment and services, including the renegotiation,
delay and/or cancellation of projects by our customers and the
reduction in the number of project opportunities, (3) a continuing
decrease in the demand for cement, minerals and related products,
(4) the number of competitors with competitively priced products
and services, (5) product development or other initiatives by our
competitors, (6) shifts in industry capacity, (7) fluctuations in
foreign exchange and interest rates, (8) fluctuations in
availability and cost of raw materials or energy, (9) delays in the
start of projects included in our forecasts, (10) delays in the
implementation of projects included in our forecasts and disputes
regarding the performance of our services, (11) the uncertainty of
government regulation and politics in Asia, the Middle
East and other markets, (12) potential negative financial
impact from regulatory investigations, claims, lawsuits and other
legal proceedings and challenges, (13) the timing and extent of our
restructuring program and the restructuring charges to be incurred
in connection therewith, (14) whether the proposed Arrangement is
approved by our shareholders, (15) difficulties seeking out and
obtaining interests in mineral royalties, and (16) other factors
beyond our control. Additional information about these and
other assumptions, risks and uncertainties are set out in
the "Risk Factors" section in our Form 20-F filed with the
Securities and Exchange Commission and the "Risks and
Uncertainties" section in our MD&A filed with Canadian
securities regulators.
Contact Information:
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Allen & Caron Inc.
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Rene Randall
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Joseph Allen (investors)
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KHD Humboldt Wedag International Ltd.
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1 (212) 691-8087
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1 (604) 683-8286 ex 224
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joe@allencaron.com
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rene.randall@khd.com
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or
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Len Hall (media)
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1 (949) 474-4300
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len@allencaron.com
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- UNAUDITED INTERIM FINANCIAL TABLES FOLLOW
-
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KHD HUMBOLDT WEDAG
INTERNATIONAL LTD.
CONSOLIDATED
BALANCE SHEETS
December 31, 2009
and 2008
(Audited)
(U.S. Dollars in
Thousands)
|
|
|
2009
|
2008
|
|
ASSETS
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
$
420,551
|
$
409,087
|
|
Short-term cash deposits
|
6,916
|
-
|
|
Securities
|
16,432
|
2,987
|
|
Restricted cash
|
24,979
|
32,008
|
|
Accounts receivable, trade
|
96,982
|
62,760
|
|
Other
receivables
|
36,179
|
28,313
|
|
Inventories
|
80,815
|
110,161
|
|
Contract deposits, prepaid and
other
|
53,893
|
58,694
|
|
Future
income tax assets
|
1,748
|
7,679
|
|
Total
current assets
|
738,495
|
711,689
|
|
|
|
|
|
|
|
|
|
Non-current Assets
|
|
|
|
|
|
|
|
Note
receivables
|
1,672
|
-
|
|
Account receivable, trade
|
4,660
|
-
|
|
Property, plant and
equipment
|
2,257
|
2,489
|
|
Interest in resource
property
|
27,150
|
24,861
|
|
Equity
method investments
|
73
|
325
|
|
Future
income tax assets
|
13,405
|
6,339
|
|
Investment in
preferred shares of former subsidiaries
|
-
|
19,125
|
|
Other non-current
assets
|
1,191
|
830
|
|
Total
non-current assets
|
50,408
|
53,969
|
|
Total
assets
|
$
788,903
|
$
765,658
|
|
|
|
|
|
|
|
|
KHD HUMBOLDT WEDAG
INTERNATIONAL LTD.
CONSOLIDATED
BALANCE SHEETS (cont'd)
December 31, 2009
and 2008
(Audited)
(U.S. Dollars in
Thousands)
|
|
|
2009
|
2008
|
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LIABILITIES
|
|
|
|
|
|
|
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Current
Liabilities
|
|
|
|
|
|
|
|
Accounts payable and accrued
expenses
|
$
191,746
|
$
178,582
|
|
Progress billing above costs and
estimated
earnings on uncompleted contracts
|
77,841
|
171,843
|
|
Advance payments received from
customers
|
26,927
|
11,331
|
|
Income
tax liabilities
|
18,092
|
9,112
|
|
Deferred credit, future income tax
assets
|
1,748
|
4,212
|
|
Accrued pension liabilities, current
portion
|
2,070
|
2,158
|
|
Provision for warranty costs, current
portion
|
28,282
|
30,856
|
|
Provision for restructuring
costs
|
8,025
|
-
|
|
Provision for supplier commitments on
terminated
customer contracts
|
12,943
|
23,729
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Total
current liabilities
|
367,674
|
431,823
|
|
|
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Long-term
Liabilities
|
|
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|
|
|
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Long-term debt, less current
portion
|
11,649
|
11,313
|
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Accrued pension liabilities, less
current portion
|
28,861
|
29,209
|
|
Provision for warranty costs, less
current portion
|
25,711
|
7,524
|
|
Deferred credit, future income tax
assets
|
-
|
4,176
|
|
Future
income tax liability
|
14,210
|
7,646
|
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Other
long-term liabilities
|
15,607
|
8,344
|
|
Total
long-term liabilities
|
96,038
|
68,212
|
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Total
liabilities
|
463,712
|
500,035
|
|
|
|
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MINORITY
INTERESTS
|
5,403
|
3,709
|
|
|
|
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SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
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Common
stock, without par value
|
141,604
|
143,826
|
|
Treasury stock
|
(83,334)
|
(93,793)
|
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Contributed surplus
|
7,232
|
7,623
|
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Retained earnings
|
185,790
|
155,681
|
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Accumulated other comprehensive
income
|
68,496
|
48,577
|
|
Total
shareholders' equity
|
319,788
|
261,914
|
|
|
|
|
|
|
$
788,903
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$
765,658
|
|
|
|
|
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KHD HUMBOLDT WEDAG
INTERNATIONAL LTD.
CONSOLIDATED
STATEMENTS OF INCOME
For the Years
Ended December 31, 2009 and 2008
(Audited)
(U.S. Dollars in
Thousands, Except per Share Data)
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2009
|
2008
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Revenues
|
$
576,408
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$
638,354
|
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Cost of revenues
|
(457,847)
|
(516,631)
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Recovery of (loss on) terminated
customer contracts
|
17,829
|
(31,966)
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Gross profit
|
136,390
|
89,757
|
|
|
|
|
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Income from interest in resource
property
|
13,530
|
27,185
|
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Selling, general and administrative
expense
|
(74,796)
|
(56,156)
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|
Stock-based compensation recovery
(expense) - selling general and
administrative
|
391
|
(4,401)
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Restructuring costs
|
(9,220)
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-
|
|
Gain on sale of workshop and related
assets
|
5,254
|
-
|
|
Operating income
|
71,549
|
56,385
|
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Interest income
|
7,043
|
21,449
|
|
Interest expense
|
(2,793)
|
(2,291)
|
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Foreign currency transaction gains
(losses), net
|
(2,006)
|
2,149
|
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Share of loss of equity method
investee
|
(254)
|
(272)
|
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Loss
on settlement of investment in preferred shares of
former
subsidiaries
|
(9,538)
|
(55,076)
|
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Other income (expense), net
|
3,825
|
(9,912)
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Income before
income taxes and minority interests
|
67,826
|
12,432
|
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Provision for
income taxes:
|
|
|
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Income
taxes
|
(23,026)
|
(12,800)
|
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Resource property
revenue taxes
|
(3,039)
|
(5,864)
|
|
|
(26,065)
|
(18,664)
|
|
|
|
|
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Income (loss) before minority
interests
|
41,761
|
(6,232)
|
|
Minority interests
|
(1,050)
|
(720)
|
|
Net income (loss)
|
$
40,711
|
$
(6,952)
|
|
|
|
|
|
Basic earnings (loss) per
share
|
$
1.34
|
$
(0.23)
|
|
|
|
|
|
Diluted earnings (loss) per
share
|
$
1.34
|
$
(0.23)
|
|
|
|
|
|
|
|
|
|
Weighted average number of common
shares outstanding
- basic
|
30,354,207
|
30,401,018
|
|
-
diluted
|
30,354,207
|
30,401,018
|
|
|
|
|
|
|
KHD HUMBOLDT WEDAG
INTERNATIONAL LTD.
FINANCIAL
SUMMARY
As of December 31,
2009
(Audited)
(U.S. Dollars in
Thousands, Except per Share Data and Ratios)
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
$
420,551
|
|
|
|
|
Securities
|
16,432
|
|
|
|
|
Restricted cash
|
24,979
|
|
|
|
|
Working capital
|
370,821
|
|
|
|
|
Total assets
|
788,903
|
|
|
|
|
Shareholders' equity
|
319,788
|
|
|
|
|
Book value per share
|
10.57
|
|
|
|
|
Current ratio
|
2.01
|
|
|
|
|
Long-term debt to equity
ratio
|
0.04
|
|
|
|
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SOURCE KHD Humboldt Wedag International Ltd.