Dynamic Materials Corp. (BOOM) filed Quarterly Report for the period ended 2009-09-30.
DYNAMIC MATERIALS CORP. is engaged in explosion metal working. Forms of explosion metal working include: cladding where two or more metals are explosively joined to each other; and forming of metals in which metals are shaped shock hardened or altered using explosives as an energy source. It distributes its products in North America primarily through its internal sales organization. It also uses independent sales representatives in specific industries or territories to complement and extend its internal selling efforts. Dynamic Materials Corp. has a market cap of $243.7 million; its shares were traded at around $18.92 with a P/E ratio of 12.6 and P/S ratio of 1.1. The dividend yield of Dynamic Materials Corp. stocks is 0.8%. Dynamic Materials Corp. had an annual average earning growth of 97.8% over the past 5 years.
Highlight of Business Operations:
Our net sales for the nine months ended September 30, 2009 decreased by $51,689 (29.7%) compared to the same period of 2008, reflecting year-to-year net sales decreases of $44,941 (30.5%), $5,957 (31.1%), and $791 (10.6%) for our Explosive Metalworking, Oilfield Products, and AMK Welding segments, respectively. The sales decrease of approximately $51.7 million includes a sales volume decrease of approximately $42.8 million and an unfavorable foreign exchange translation adjustment of approximately $8.9 million on our European sales as a result of the increased value of the U.S. dollar against the Euro. Income from operations decreased 52.1% to $13,833 in the nine months ended September 30, 2009 from $28,901 in the same period of 2008. This $15,068 decrease reflects declines in Explosive Metalworking’s, Oilfield Products’, and AMK Welding’s operating income of $11,012, $2,788, and $974, respectively, and a $294 increase in stock-based compensation expense. Our net income decreased by 59.7% to $7,527 for the nine months ended September 30, 2009 from $18,683 for the same period of 2008.
Net sales for the nine months ended September 30, 2009 decreased 29.7% to $122,268 from $173,957 for the same period of 2008. Explosive Metalworking sales decreased 30.5% to $102,403 for the nine months ended September 30, 2009 (84% of total sales) from $147,344 for the same period of 2008 (85% of total sales). The decrease in Explosive Metalworking sales reflects a business slowdown in several of the industries that this business segment serves and includes approximately $7.0 million of unfavorable foreign exchange translation adjustments.
General and administrative expenses decreased by $930, or 25.3%, to $2,749 in the third quarter of 2009 from $3,679 in the third quarter of 2008. This decrease includes a $199 decrease in accrued incentive compensation, a decrease of $331 in legal, audit and consulting expenses, and a net decrease of $399 in all other expenses categories that reflects the impact of tight controls over discretionary spending as well as certain non-recurring professional service fees that we incurred in 2008 relating to the integration of DYNAenergetics. The $930 decrease in total general and administrative expenses also reflects the positive effect of $70 in favorable foreign exchange translation adjustments. As a percentage of net sales, general and administrative expenses increased to 7.9% in the third quarter of 2009 from 7.0% in the third quarter of 2008.
General and administrative expenses for the nine months ended September 30, 2009 totaled $9,318 compared to $10,612 for the same period of 2008. General and administrative expenses of our European divisions decreased by $687, or 15.5%, as a result of a 5.2% decrease in net expenses as measured in Euros and $463 in favorable foreign exchange translation adjustments. Our U.S. general and administrative expenses decreased by $607 or 9.8%. The U.S. decrease reflects a $367 decrease in accrued incentive compensation and a $307 decrease in legal, audit and
Selling expenses, which include sales commissions of $237 in 2009 and $157 in 2008, decreased by 15.3% to $2,212 in the third quarter of 2009 from $2,611 in the third quarter of 2008. The $399 decrease in our consolidated selling expenses includes decreased selling expenses of $219 and $180 at our European and U.S. divisions, respectively. The decrease in European selling expenses relates principally to staff reductions within our European explosion welding divisions and also includes $81 of favorable foreign exchange translation adjustments. The $180 decrease in our U.S. selling expenses reflects decreased sales commissions of $36, a $68 decrease in bad debt expense, a $68 decrease in accrued incentive compensation and a net decrease of $8 in other spending categories. As a percentage of net sales, selling expenses increased to 6.4% in the third quarter of 2009 from 5.0% in the third quarter of 2008.
Selling expenses decreased by 21.1% to $6,376 in the nine months ended September 30, 2009 from $8,085 in the same period of 2008. These selling expenses include sales commissions of $1,045 and $1,209 for 2009 and 2008, respectively. The $1,709 decrease in our consolidated selling expenses includes decreased year to date selling expenses of $1,320 and $389 at our European and U.S. divisions, respectively. The decrease in European selling expenses relates principally to staff reductions within our European explosion welding divisions and non-recurring expenses in the first quarter of 2008 relating to the termination of contracts with former sales agents and also includes $478 of favorable foreign exchange translation adjustments. The $389 decrease in our U.S. selling expenses reflects decreased sales commissions of $103, a $120 decrease in bad debt expense, a $166 decrease in accrued incentive compensation, a $109 decrease in travel expenses and a $141 reduction in business development, advertising and promotional expenses that were partially offset by a $100 increase in salary expense, a $68 increase in stock-based compensation and a net increase of $82 in other spending categories. As a percentage of net sales, selling expenses increased to 5.2% in the nine months ended September 30, 2009 from 4.6% in the same period of 2008.
Rate This Article: |
  |