UNITED STATES |
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TOR Minerals International,
Inc. Delaware |
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0-17321 |
74-2081929 |
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(361) 883-5591 |
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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): |
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On November 5, 2013, TOR Minerals International, Inc. (the "Company") announced its financial results for the third quarter ended September 30, 2013. Results for the third quarter of 2013 as compared to the third quarter of 2012 included:
Revenue by Product Group (in 000's) |
|
3Q13 |
|
3Q12 |
|
% Change |
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Specialty Aluminas |
$ |
4,309 |
$ |
4,294 |
0% |
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TiO2 Pigments |
4,221 |
13,399 |
-68% |
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Barium Sulfate and Other Products |
2,340 |
2,221 |
5% |
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Total |
|
$ |
10,870 |
|
$ |
19,914 |
|
-45% |
* BARYPREM sales have been reclassified from Specialty Aluminas to Barium Sulfate and Other Specialty Minerals to make comparisons more meaningful.
As expected, revenue from titanium dioxide (TiO2) pigments products, which include HITOX®, TIOPREM® and synthetic rutile (SR) products, were affected adversely by continued weakness in the broader market for TiO2 and a large third-party order for SR in 2012 that did not recur this year. Specialty alumina, which includes the ALUPREM®, HALTEX® and OPTILOAD®, were $4.3 million, approximately unchanged from the prior year. Barium sulfate and other product sales increased five percent, primarily due to increased volumes from new and existing BARTEX® customers in the United States, as well as an increase in volume for BARYPREM in Europe.
During the third quarter of 2013, gross margin decreased to 14.5 percent of revenue, versus 19.3 percent during the same period a year ago. The decrease in year-over-year gross margin comparisons was primarily to lower average selling prices for TiO2 pigment products and the impact of a large third-party sale of SR in 2012 that did not recur this year. Operating expenses decreased 5.9 percent to approximately $1.3 million. During the third quarter, net income to common shareholders was $113,000, or $0.03 per diluted share, as compared to net income of $1.8 million, or $0.53 per diluted share, during the same period a year ago.
Commenting on results, Dr. Olaf Karasch, CEO of TOR Minerals, said, "Our strategic focus remains on product innovation and continuous reduction in production costs. While we expect near-term profitability will likely continue to be negatively affected by lower prices, lower fixed cost absorption, and the increased costs of raw materials and energy, improved production efficiencies and improve yields should help to partially offset these factors. In addition, our future results will benefit if our recently introduced specialty alumina and TiO2 color pigment products continue to gain market acceptance and these new specialty alumina and TiO2 color pigment products are showing promise."
TOR Minerals will host a conference call at 4:00 p.m. CDT on November 5, 2013, to further discuss its third quarter results. The call will be simultaneously webcast, and can be accessed via the "News" section on the Company's website, www.torminerals.com. Investors and interested parties may participate in the call by dialing 877-407-8033 and referring to conference ID #100622.
This statement provides forward-looking information as that term is defined in the Private Securities Litigation Reform Act of 1995, and, therefore, is subject to certain risks and uncertainties. There can be no assurance that the actual results, business conditions, business developments, losses and contingencies and local and foreign factors will not differ materially from those suggested in the forward-looking statements as a result of various factors, including market conditions, general economic conditions, including the present slowdown in U.S. construction and the risks of a general business slow down or recession, the increasing cost of energy, raw materials and labor, competition, the receptivity of the markets for our anticipated new products, advances in technology, changes in foreign currency rates, freight price increase, commodity price increases, delays in delivery of required equipment and other factors.
A copy of this press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(a) |
Financial
Statements of Businesses Acquired. |
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(b) |
Pro
Forma Financial Information. |
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(c) |
Shell company transaction |
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(d) |
Exhibits. |
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Exhibit |
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99.1 |
Press Release, dated November 5, 2013, announcing the Company's third quarter ended September 30, 2013 financial results |
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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. |
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TOR MINERALS INTERNATIONAL, INC. |
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Date: November 5, 2013 |
/s/ BARBARA RUSSELL |
Barbara Russell |
EXHIBIT INDEX
Exhibit No. |
Description
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99.1 |
Press Release, dated November 5, 2013, announcing the Company's third quarter ended September 30, 2013 financial results |
EHIBIT 99.1
TOR Minerals International Reports Third Quarter Financial Results
CORPUS CHRISTI, Texas, November 5, 2013 - TOR Minerals International (Nasdaq: TORM), producer of, high performance specialty minerals, today announced its financial results for the third quarter ended September 30, 2013. Results for the third quarter of 2013 as compared to the third quarter of 2012 included:
Revenue by Product Group (in 000's) |
|
3Q13 |
|
3Q12 |
|
% Change |
||
Specialty Aluminas |
$ |
4,309 |
$ |
4,294 |
0% |
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TiO2 Pigments |
4,221 |
13,399 |
-68% |
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Barium Sulfate and Other Products |
2,340 |
2,221 |
5% |
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Total |
|
$ |
10,870 |
|
$ |
19,914 |
|
-45% |
* BARYPREM sales have been reclassified from Specialty Aluminas to Barium Sulfate and Other Specialty Minerals to make comparisons more meaningful.
As expected, revenue from titanium dioxide (TiO2) pigments products, which include HITOX®, TIOPREM® and synthetic rutile (SR) products, were affected adversely by continued weakness in the broader market for TiO2 and a large third-party order for SR in 2012 that did not recur this year. Specialty alumina, which includes the ALUPREM®, HALTEX® and OPTILOAD®, were $4.3 million, approximately unchanged from the prior year. Barium sulfate and other product sales increased five percent, primarily due to increased volumes from new and existing BARTEX® customers in the United States, as well as an increase in volume for BARYPREM in Europe.
During the third quarter of 2013, gross margin decreased to 14.5 percent of revenue, versus 19.3 percent during the same period a year ago. The decrease in year-over-year gross margin comparisons was primarily to lower average selling prices for TiO2 pigment products and the impact of a large third-party sale of SR in 2012 that did not recur this year. Operating expenses decreased 5.9 percent to approximately $1.3 million. During the third quarter, net income to common shareholders was $113,000, or $0.03 per diluted share, as compared to net income of $1.8 million, or $0.53 per diluted share, during the same period a year ago.
Commenting on results, Dr. Olaf Karasch, CEO of TOR Minerals, said, "Our strategic focus remains on product innovation and continuous reduction in production costs. While we expect near-term profitability will likely continue to be negatively affected by lower prices, lower fixed cost absorption, and the increased costs of raw materials and energy, improved production efficiencies and improve yields should help to partially offset these factors. In addition, our future results will benefit if our recently introduced specialty alumina and TiO2 color pigment products continue to gain market acceptance and these new specialty alumina and TiO2 color pigment products are showing promise."
TOR Minerals will host a conference call at 4:00 p.m. CDT on November 5, 2013, to further discuss its third quarter results. The call will be simultaneously webcast, and can be accessed via the "News" section on the Company's website, www.torminerals.com. Investors and interested parties may participate in the call by dialing 877-407-8033 and referring to conference ID #100622.
Headquartered in Corpus Christi, Texas, TOR Minerals International is a global manufacturer and marketer of specialty mineral and pigment products for high performance applications with manufacturing and regional offices located in the United States, Netherlands and Malaysia.
This statement provides forward-looking information as that term is defined in the Private Securities Litigation Reform Act of 1995, and, therefore, is subject to certain risks and uncertainties. There can be no assurance that the actual results, business conditions, business developments, losses and contingencies and local and foreign factors will not differ materially from those suggested in the forward-looking statements as a result of various factors, including market conditions, general economic conditions, including the present slowdown in U.S. construction and the risks of a general business slow down or recession, the increasing cost of energy, raw materials and labor, competition, the receptivity of the markets for our anticipated new products, advances in technology, changes in foreign currency rates, freight price increase, commodity price increases, delays in delivery of required equipment and other factors.
TOR Minerals International, Inc. and Subsidiaries |
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Condensed Consolidated Income Statements |
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(Unaudited) |
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(In thousands, except per share amounts) |
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Three Months |
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Nine Months |
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2013 |
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2012 |
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2013 |
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2012 |
NET SALES |
$ |
10,870 |
$ |
19,914 |
$ |
33,029 |
$ |
46,830 |
Cost of sales |
9,289 |
16,068 |
28,242 |
36,127 |
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GROSS MARGIN |
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1,581 |
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3,846 |
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4,787 |
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10,703 |
Technical services and research and development |
135 |
90 |
459 |
273 |
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Selling, general and administrative expenses |
1,119 |
1,242 |
3,644 |
3,825 |
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(Gain) loss on disposal of assets |
- |
(6) |
10 |
(6) |
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OPERATING INCOME |
|
327 |
|
2,520 |
|
674 |
|
6,611 |
OTHER EXPENSE: |
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Interest expense, net |
(103) |
(143) |
(286) |
(397) |
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Loss on foreign currency exchange rate |
(84) |
(24) |
(151) |
(21) |
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Other, net |
6 |
- |
18 |
1 |
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INCOME BEFORE INCOME TAX |
|
146 |
|
2,353 |
|
255 |
|
6,194 |
Income tax expense |
33 |
516 |
67 |
1,402 |
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NET INCOME |
$ |
113 |
$ |
1,837 |
$ |
188 |
$ |
4,792 |
Plus: 6% Convertible Debenture Interest Expense |
- |
- |
- |
36 |
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Income Available to Common Shareholders |
$ |
113 |
$ |
1,837 |
$ |
188 |
$ |
4,828 |
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Income per common share: |
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Basic |
$ |
0.04 |
$ |
0.62 |
$ |
0.06 |
$ |
1.77 |
Diluted |
$ |
0.03 |
$ |
0.53 |
$ |
0.06 |
$ |
1.43 |
Weighted average common shares outstanding: |
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Basic |
3,012 |
2,968 |
2,999 |
2,714 |
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Diluted |
3,422 |
3,441 |
3,271 |
3,383 |
TOR Minerals International, Inc. and Subsidiaries |
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Condensed Consolidated Balance Sheets |
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(In thousands, except per share amounts) |
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September 30, |
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December 31, |
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(Unaudited) |
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ASSETS |
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CURRENT ASSETS: |
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Cash and cash equivalents |
$ |
1,799 |
$ |
2,799 |
Trade accounts receivable, net |
4,896 |
3,972 |
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Inventories, net |
27,141 |
22,895 |
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Other current assets |
956 |
1,822 |
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Total current assets |
34,792 |
31,488 |
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PROPERTY, PLANT AND EQUIPMENT, net |
23,806 |
22,933 |
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OTHER ASSETS |
23 |
25 |
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Total Assets |
$ |
58,621 |
$ |
54,446 |
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LIABILITIES AND SHAREHOLDERS' EQUITY |
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CURRENT LIABILITIES: |
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Accounts payable |
$ |
5,998 |
$ |
4,608 |
Accrued expenses |
1,479 |
1,864 |
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Notes payable under lines of credit |
2,869 |
2,109 |
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Export credit refinancing facility |
3,970 |
394 |
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Current deferred tax liability |
173 |
173 |
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Current maturities - capital leases |
17 |
33 |
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Current maturities of long-term debt - financial institutions |
1,111 |
1,202 |
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Total current liabilities |
15,617 |
10,383 |
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LONG-TERM DEBT, net of current maturities |
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Capital leases |
- |
12 |
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Long-term debt - financial institutions |
1,846 |
2,316 |
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DEFERRED TAX LIABILITY |
840 |
1,007 |
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Total liabilities |
18,303 |
13,718 |
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COMMITMENTS AND CONTINGENCIES |
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SHAREHOLDERS' EQUITY: |
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Common stock $1.25 par value:
authorized, 6,000 shares; |
3,765 |
3,733 |
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Additional paid-in capital |
29,338 |
29,017 |
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Retained earnings |
3,457 |
3,269 |
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Accumulated other comprehensive income: |
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Cumulative translation adjustment |
3,758 |
4,709 |
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Total shareholders' equity |
40,318 |
40,728 |
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Total Liabilities and Shareholders' Equity |
$ |
58,621 |
$ |
54,446 |
TOR Minerals International, Inc. and Subsidiaries |
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Condensed Consolidated Statements of Cash Flows |
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(Unaudited) |
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(In thousands) |
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Nine Months Ended September 30, |
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2013 |
|
2012 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net Income |
$ |
188 |
$ |
4,792 |
Adjustments to reconcile net income to net cash used in operating activities: |
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Depreciation |
2,355 |
1,842 |
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Loss on disposal of assets |
10 |
(6) |
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Share-based compensation |
85 |
71 |
||
Convertible debenture interest expense |
- |
22 |
||
Deferred income taxes |
(123) |
572 |
||
Provision for bad debts |
3 |
69 |
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Changes in working capital: |
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Trade accounts receivables |
(903) |
(9,499) |
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Inventories |
(5,011) |
(1,601) |
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Other current assets |
814 |
(788) |
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Accounts payable and accrued expenses |
1,135 |
2,684 |
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Net cash used in operating activities |
(1,447) |
(1,842) |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
|
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Additions to property, plant and equipment |
(3,529) |
(3,068) |
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Proceeds from sales of property, plant and equipment |
2 |
8 |
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Net cash used in investing activities |
(3,527) |
(3,060) |
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CASH FLOWS FROM FINANCING ACTIVITIES: |
|
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Net proceeds from lines of credit |
804 |
1,656 |
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Net proceeds from export credit refinancing facility |
3,600 |
1,032 |
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Net (payments on) proceeds from capital leases |
(30) |
5 |
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Proceeds from long-term bank debt |
276 |
774 |
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Payments on long-term bank debt |
(815) |
(605) |
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Proceeds
from the issuance of common stock |
267 |
148 |
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Net cash provided by financing activities |
4,102 |
3,010 |
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Effect of foreign currency exchange rate fluctuations on cash and cash equivalents |
(128) |
69 |
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Net decrease in cash and cash equivalents |
(1,000) |
(1,823) |
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Cash and cash equivalents at beginning of year |
2,799 |
3,381 |
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Cash and cash equivalents at end of period |
$ |
1,799 |
$ |
1,558 |
Supplemental cash flow disclosures: |
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Interest paid |
$ |
286 |
$ |
397 |
Income taxes paid |
$ |
214 |
$ |
- |