Date: August 9, 2011
Source: Industrial Services of America, Inc.
Industrial Services of America, Inc. (NASDAQ: IDSA), a company that buys, processes and markets ferrous and non-ferrous metals and other recyclable commodities for domestic users and export markets, and offers programs and equipment to help businesses manage wastes, today reported financial results for the second quarter ending June 30, 2011.
For the six months ending June 30, 2011:
For the three months ending June 30, 2011:
Key Highlights for the Second Quarter Ending June 30, 2011
Recycling Volumes – 2nd Quarter Summary
Brian Donaghy, President and Chief Operating Officer of ISA stated, "We saw a dramatic change in stainless market conditions during the second quarter of 2011. Virtually every stainless scrap provider, including ISA, saw demand dwindle as a result of the world-wide decrease in demand for stainless steel and other nickel-based scrap. We believe that consumers have worked down their inventory levels, and we are optimistic that demand will soon rebound.
“We took advantage of continued strong ferrous and non-ferrous scrap market conditions during the quarter and substantially increased our shipments in these commodities. This helped offset the downturn in our stainless business. However, like many other scrap companies, we experienced some pressure on margins as we had to pay higher prices to fill customer orders.
“We also used the seasonally soft summer to refine operations. We undertook a thorough review of all of our personnel, streamlining, hiring and reallocating certain employees to areas where they can make the most impact. This included bolstering our Alloys division with industry veterans who have extensive supplier relationships and who can help develop our Alloys team. We feel very good about the team we have in place today, just in time for the return of more favorable market conditions.”
Harry Kletter, Chairman of the Board of ISA, stated, “After spending over 60 years in the industry I can tell you that the scrap business is in the early stages of growth but there will be continued consolidation. I envision a hand full of major companies that will partner up with mills which will dominate the industry, which ISA plans to be involved with. The company will continue to look for strategic relationships and other alternatives during the next few years to enhance stockholder value.
“As the economy improves, the scrap industry will continue to grow and we will continue to expand our presence. The recent investment we made in the stainless and alloys operations have given us the ability to further grow and diversify. As the world demand for scrap continues to increase, we plan to take advantage of the many opportunities ahead. During the past two years we have had tremendous growth and now our current focus is to become a much more efficient operation with increased margins.”
Conference Call to Discuss Second Quarter 2011 Results
ISA will host a conference call on Tuesday, August 9, 2011 at 2:00 PM Eastern time to discuss second quarter results. Participants can access the call by dialing:
U.S. and Canada Dial-in Number: 877-354-6067
Conference ID #88899450
Callers should identify the Industrial Services of America earnings results call.
A replay will be available one hour after the call through midnight August
11, 2011 by calling:
855-859-2056 or 404-537-3406
ISA’s 2011 SEC filings are available for review at the Securities and Exchange Commission web site at www.sec.gov/edgar/searchedgar/companysearch.html.
About ISA
Headquartered in Louisville, Kentucky, Industrial Services of America, Inc., is a publicly traded company whose core business is buying, processing and marketing scrap metals and recyclable materials for domestic users and export markets. Additionally, ISA offers commercial, industrial and business customers a variety of programs and equipment to manage waste. More information about ISA is available at www.isa-inc.com.
This news release contains forward-looking statements that involve risks and uncertainties that could cause actual results to differ from predicted results. Specific risks include fluctuations in the price of recycled materials, varying demand for waste managing systems, equipment and services, competitive pressures in waste managing systems and equipment, competitive pressures in the waste managing business, and loss of customers. Further information on factors that could affect ISA’s results is detailed in ISA’s filings with the Securities and Exchange Commission. ISA undertakes no obligation to publicly release the results of any revisions to the forward-looking statements.
| INDUSTRIAL SERVICES OF AMERICA, INC. AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
| SIX MONTHS ENDED JUNE 30, 2011 AND 2010 | ||||||||||
| (UNAUDITED) | ||||||||||
| 2011 | 2010 | |||||||||
| (in thousands, except per share information) | ||||||||||
| Revenue from services | $ | 2,661 | $ | 3,070 | ||||||
| Revenue from product sales | 168,489 | 163,914 | ||||||||
| Total Revenue | 171,150 | 166,984 | ||||||||
| Cost of goods sold for services | 2,283 | 2,787 | ||||||||
| Cost of goods sold for product sales | 156,849 | 150,160 | ||||||||
| Total Cost of goods sold | 159,132 | 152,947 | ||||||||
| Selling, general and administrative expenses | 6,351 | 6,765 | ||||||||
| Income before other income (expense) | 5,667 | 7,272 | ||||||||
| Other income (expense) | ||||||||||
| Interest expense | (1,206 | ) | (668 | ) | ||||||
| Interest income | 11 | 17 | ||||||||
| Gain on sale of assets | 141 | 234 | ||||||||
| Provision for lawsuit settlement | (175 | ) | - | |||||||
| Other income (loss), net | (502 | ) | (4 | ) | ||||||
| Total other expense | (1,731 | ) | (421 | ) | ||||||
| Income before income taxes | 3,936 | 6,851 | ||||||||
| Income tax provision | 1,456 | 2,740 | ||||||||
| Net income | $ | 2,480 | $ | 4,111 | ||||||
| Basic earnings per share | $ | 0.36 | $ | 0.64 | ||||||
| Diluted earnings per share | $ | 0.36 | $ | 0.63 | ||||||
| Weighted shares outstanding: | ||||||||||
| Basic | 6,913 | 6,456 | ||||||||
| Diluted | 6,953 | 6,475 | ||||||||
| INDUSTRIAL SERVICES OF AMERICA, INC. AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
| THREE MONTHS ENDED JUNE 30, 2011 AND 2010 | ||||||||||
| (UNAUDITED) | ||||||||||
| 2011 | 2010 | |||||||||
| (in thousands, except per share information) | ||||||||||
| Revenue from services | $ | 1,290 | $ | 1,535 | ||||||
| Revenue from product sales | 63,673 | 91,280 | ||||||||
| Total Revenue | 64,963 | 92,815 | ||||||||
| Cost of goods sold for services | 1,006 | 1,436 | ||||||||
| Cost of goods sold for product sales | 59,775 | 83,625 | ||||||||
| Total Cost of goods sold | 60,781 | 85,061 | ||||||||
| Selling, general and administrative expenses | 2,572 | 3,564 | ||||||||
| Income before other income (expense) | 1,610 | 4,190 | ||||||||
| Other income (expense) | ||||||||||
| Interest expense | (534 | ) | (340 | ) | ||||||
| Interest income | 5 | 9 | ||||||||
| Gain on sale of assets | 92 | 50 | ||||||||
| Provision for lawsuit settlement | (175 | ) | - | |||||||
| Other income (loss), net | (502 | ) | 3 | |||||||
| Total other expense | (1,114 | ) | (278 | ) | ||||||
| Income before income taxes | 496 | 3,912 | ||||||||
| Income tax provision | 183 | 1,565 | ||||||||
| Net income | $ | 313 | $ | 2,347 | ||||||
| Basic earnings per share | $ | 0.05 | $ | 0.36 | ||||||
| Diluted earnings per share | $ | 0.05 | $ | 0.36 | ||||||
| Weighted shares outstanding: | ||||||||||
| Basic | 6,790 | 6,463 | ||||||||
| Diluted | 6,825 | 6,490 | ||||||||
| INDUSTRIAL SERVICES OF AMERICA, INC. | ||||||||
| SUPPLEMENTAL FINANCIAL INFORMATION | ||||||||
| Reconciliation of EBITDA (1): | ||||||||
| Three Months ending June 30, | Six Months ending June 30, | |||||||
| 2011 | 2010 | 2011 | 2010 | |||||
| Net Income | 312,576 | 2,347,200 | 2,479,358 | 4,110,464 | ||||
| Interest expense | 534,437 | 339,642 | 1,206,119 | 668,611 | ||||
| Income taxes | 183,575 | 1,564,799 | 1,456,130 | 2,740,310 | ||||
| Depreciation | 948,194 | 866,012 | 1.879,646 | 1,730,269 | ||||
| Amortization | 187,500 | - | 375,000 | - | ||||
| EBITDA (1) | 2,166,282 | 5,117,653 | 7,396,253 | 9,249,654 | ||||
| (1) EBITDA is calculated by the Company as net income before interest expense, income tax expense, depreciation and amortization. The Company uses EBITDA as a key performance measure of results of operations for purposes of evaluating performance internally. This non-GAAP measurement is not intended to replace the presentation of our financial results in accordance with GAAP. Rather, we believe the EBITDA calculation provides additional information to investors and debt holders due to the fact that tax credits, tax rates and other tax related items vary by company. Additionally, years of service for fixed assets and amortizable assets are based on company judgment. Finally, companies have several ways of raising capital which can affect interest expense. We believe the presentation of EBITDA provides a meaningful measure of performance exclusive of these unique items. | ||||||||
For more information, contact:
Industrial Services of America, Inc.
Harry Kletter, 502-366-3452
hklet@isa-inc.com.
or
Alan Schroering, 502-366-3452
aschroering@isa-inc.com.
http://www.isa-inc.com.
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