8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):
April 26, 2006

CARBO CERAMICS INC.

(Exact name of registrant as specified in its charter)

Delaware	001-15903	72-1100013
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

6565 MacArthur Boulevard, Suite 1050, Irving, TX	75039
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (972) 401-0090

(Former name, former address and former fiscal year, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e 4(c))

TABLE OF CONTENTS

Press Release

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

     The following information, including the Exhibit to this Form 8-K, is being furnished pursuant to Item 2.02 — Results of Operations and Financial Condition of Form 8-K. This information is not deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 and is not incorporated by reference into any Securities Act registration statements.

     On April 26, 2006, CARBO Ceramics Inc. issued a press release, a copy of which is attached hereto as Exhibit 99.1, announcing first quarter 2006 earnings.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(c) Exhibits
Press release dated April 26, 2006

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CARBO CERAMICS INC.
 

/s/Paul G. Vitek  

Paul G. Vitek 

Sr. Vice President, Finance and
Chief Financial Officer 

Date: April 26, 2006

3

EXHIBIT INDEX

EXHIBIT NUMBER	DESCRIPTION
99.1	Copy of CARBO Ceramics Inc. press release dated April 26, 2006

4

EX-99.1

Exhibit 99.1

Final – for immediate release	CONTACT: PAUL VITEK, CFO (972)401-0090
	Release #06-06

CARBO CERAMICS INC. ANNOUNCES RECORD EARNINGS AND EXPANSION OF TOOMSBORO,
GEORGIA MANUFACTURING FACILITY

Conference Call Scheduled for Today, 10:00 a.m. Central Time

Irving, Texas (April 26, 2006) — CARBO Ceramics Inc. (NYSE: CRR), the world’s leading manufacturer of ceramic proppants for use in the hydraulic fracturing of natural gas and oil wells and the leading supplier of fracture and reservoir diagnostic services, today announced net income of $13.0 million, or $0.53 per diluted share, on revenues of $74.3 million for the quarter ended March 31, 2006. Both revenues and net income were the highest for any quarter in the company’s history. Revenues for the quarter increased 21 percent while net income increased 12 percent compared to the first quarter of 2005. The company also announced that its new manufacturing facility in Toomsboro, Georgia started production as scheduled in the first quarter and the company’s Board of Directors has approved the construction of a second production line at this facility.

The increase in revenues compared to last year’s first quarter was attributable to record proppant sales volume, an increase in the average selling price of the company’s ceramic proppants and a 21 percent increase in revenues from Pinnacle Technologies, Inc., the company’s fracture and reservoir diagnostics business. Revenues for the first quarter of 2006 included $7.3 million from Pinnacle Technologies, Inc. compared to $6.0 million for the same period a year earlier.

Worldwide proppant sales were 209 million pounds for the quarter, an increase of 4 percent compared to the previous year’s first quarter. The increased sales volume was the result of record sales volume in the U.S. and Canada, where sales increased 16 percent compared to the first quarter of 2005. After having sales volume constrained by manufacturing capacity throughout 2005, initial production from the company’s new manufacturing facility allowed the company to respond to continued strong demand in the North American market. Sales outside of North America declined 32 percent compared to last year’s first quarter, due to a decline in sales to Russia. While the company’s sales in Russia have been impacted by an increase in the availability of product produced by Russian manufacturers, the company anticipates improving its sales in Russia during 2006 as a result of new marketing initiatives in that country. Excluding Russia, sales outside of North America increased 38 percent versus the first quarter of 2005 due to improved activity in China, the Middle East and West Africa.

The average selling price of the company’s ceramic proppant increased 17 percent compared to the first quarter of 2005, due to the cumulative impact of price increases implemented in June and November of 2005. While the company’s manufacturing costs were adversely impacted by higher prices paid for natural gas and raw materials, these costs were more than offset by the increase in the average selling price of the company’s ceramic proppant. As a result, there was a slight increase in the profit generated per pound of proppant sold, despite a decline in the operating margin as a percentage of revenues. In addition, the improved revenue from Pinnacle Technologies without a corresponding increase in operating expenses resulted in an improvement in operating margins for that business segment.

Selling, general and administrative expenses increased 6 percent compared to the previous year’s first quarter but declined to 10.1 percent of revenues compared to 11.5 percent of revenues for the same period a year earlier. While spending increased for marketing, research and development and administration, spending declined for professional fees related to legal and regulatory activities.

CARBO Ceramics First Quarter 2006 Earnings Release
April 26, 2006
Page 2

The first production line of the company’s new manufacturing facility in Toomsboro, Georgia (previously referred to as McIntyre II) started up as scheduled in January 2006 and was completed slightly below the planned expenditure of $62 million. When fully operational, this production line is expected to have annual manufacturing capacity of 250 million pounds. Production from this facility during the first quarter met the company’s objective of 50 percent of capacity and is expected to improve to 75 percent of capacity during the second quarter. In light of the startup of this facility as expected, and the continued strong demand for the company’s ceramic proppants, the company’s Board of Directors has approved the construction of a second production line at this facility. Construction of the second production line is expected to cost approximately $54 million and the Company anticipates its completion in the third quarter of 2007. The second production line is expected to have an installed cost less than the first production line due to the investment in infrastructure made during the initial construction project. The new production line is expected to have annual capacity of 250 million pounds, bringing the Toomsboro facility’s total capacity to 500 million pounds per year.

President and CEO Mr. Jesse P. Orsini provided additional guidance for 2006, stating that “We are pleased that the startup of our Toomsboro, Georgia facility has gone as anticipated and has allowed us to grow our sales volume during the first quarter. We expect that the demand will remain strong for our products and, if the Toomsboro startup continues to progress without interruption, we should be able to grow sales volume by another 10 to 15 percent during the second quarter. With the recent decline in the price of natural gas, we have reinitiated our strategy of obtaining fixed price natural gas commitments for our manufacturing needs. This should result in a modest improvement in operating margins in the second and third quarters of this year.”

Commenting on the company’s continuing expansion of manufacturing capacity, Orsini further stated, “Construction of our manufacturing facility in Kopeysk, Russia continues on schedule. However, we now expect this facility to cost approximately $41 million instead of our previous estimate of $32 million due to higher than anticipated installation and construction costs. While the increased cost is disappointing, the quality of the construction of the plant has exceeded our expectations and we believe that the Russian market continues to present an attractive long-term opportunity. We are tremendously excited about the continued expansion of our Toomsboro facility. The expansion of this plant will be accomplished more quickly and at a lower cost than the original production line and will support our continued growth objectives.”

As previously announced, a conference call to discuss the company’s first quarter results has been scheduled for today at 10:00 a.m. central time. To participate in the teleconference, please dial 877-836-3879 and reference the CARBO Ceramics conference call or conference ID # 8243948. International callers should dial 706-679-7469. The conference call can also be accessed by visiting the company’s Web site, http://www.carboceramics.com.

CARBO Ceramics Inc. is based in Irving, Texas.

The statements in this news release that are not historical statements, including statements regarding our future financial and operating performance, are forward-looking statements within the meaning of the federal securities laws. All forward-looking statements are based on management’s current expectations and estimates, which involve risks and uncertainties that could cause actual results to differ materially from those expressed in forward-looking statements. Among these factors are changes in overall economic conditions, changes in demand for our products, changes in the demand for, or price of, oil and natural gas, risks of increased competition, technological, manufacturing and product development risks, loss of key customers, changes in government regulations, foreign and domestic political and legislative risks, the risks of war and international and domestic terrorism, risks associated with foreign operations and foreign currency exchange rates and controls; weather-related risks and other risks and uncertainties described in our publicly available filings with the SEC. We assume no obligation to update forward-looking statements, except as required by law.

- tables follow -

CARBO Ceramics First Quarter 2006 Earnings Release
April 26, 2006
Page 3

	Three Months Ended
	March 31
	2006		2005
	Unaudited
	(In thousands except per share data)
Revenues	$	74,278	$	61,168
Cost of sales		46,912		36,347
Gross profit		27,366		24,821
Selling, general & administrative		7,473		7,049
Start-up costs		351		15
Operating profit		19,542		17,757
Interest income, net		437		384
Other, net		338		3
Income before income taxes		20,317		18,144
Income taxes		7,333		6,550
Net income	$	12,984	$	11,594
Earnings per share:
Basic	$	0.54	$	0.48
Diluted	$	0.53	$	0.48
Average shares outstanding:
Basic		24,243		23,952
Diluted		24,384		24,146
Depreciation and amortization	$	4,612	$	3,204

Selected Balance Sheet Information

	March 31, 2006		Dec. 31, 2005
	Unaudited
	(in thousands)
Cash, cash equivalents and short-term investments	$	58,080	$	61,670
Total other current assets		93,625		86,617
Property, plant and equipment, net		189,948		179,500
Intangible and other assets, net		6,091		6,169
Total assets		369,584		355,796
Total current liabilities		37,445		36,309
Deferred income taxes		26,809		26,121
Shareholders’ equity		305,330		293,366
Total liabilities and shareholders’ equity		369,584		355,796