American Ecology Corp. (ECOL, Financial) filed Quarterly Report for the period ended 2009-03-31.
American Ecology Corporation through its subsidiaries provide radioactive and hazardous materials management services to commercial and government entities such as nuclear power plants medical and academic institutions and petro-chemical facilities. Headquartered in Boise Idaho the Company is one of the nation's oldest radioactive and hazardous chemical waste companies. The Company currently operates in multiple states. American Ecology Corp. has a market cap of $302.3 million; its shares were traded at around $16.52 with a P/E ratio of 14.1 and P/S ratio of 1.7. The dividend yield of American Ecology Corp. stocks is 4.4%. American Ecology Corp. had an annual average earning growth of 31.7% over the past 5 years.
Treatment and disposal revenue from private clean-up customers decreased approximately 31% in the first quarter of 2009 as compared to the same period last year. This decline reflects decreased shipments from the Molycorp, Honeywell Jersey City and other smaller projects in the first quarter of 2009 compared to the same period in 2008. We believe that fewer new clean-up opportunities were identified and more previously identified projects were delayed in the first quarter of 2009 than the same quarter last year as a result of the adverse economic conditions which emerged in the second half of 2008 and continued in 2009. The Honeywell Jersey City project contributed 44% of total revenue (including transportation) in the first quarter of 2009 and 38% of total revenue (including transportation) in the first quarter of 2008, or $15.4 million and $17.3 million, respectively. Shipments under our bundled transportation and disposal contract with Chevron/Molycorp which is near completion contributed 4% of total revenue (including transportation) in the first quarter of 2009, or $1.5 million, compared to 8% of total revenue (including transportation) or $3.5 million in the first quarter of 2008.
Government clean-up business revenue decreased 36% in the first quarter of 2009 compared to the first quarter of 2008. This decline reflects a decrease in Event Business under our contract with the U.S. Army Corps of Engineers (“USACE”), which contributed $2.2 million or 6% of total revenue in the first quarter of 2009, compared to $3.8 million or 8% of total revenue in the first quarter of 2008. This quarterly decrease reflects completion of a major project phase at one site in the first quarter of 2008, partially offset by shipments from two other projects sites in the first quarter of 2009. This variability is consistent with project-specific timing at the multiple USACE clean-up sites we serve. Each such site typically is remediated over multiple years in discretely funded project phases. These phases vary by amount of waste received and duration. No USACE projects served by the Company were cancelled or awarded to competitors during the quarter. We believe timing of USACE work in the first quarter of 2009 was also affected by delayed enactment of full-year funding for the fiscal year 2009 federal budget.
Gross Profit. Gross profit for the first quarter of 2009 decreased by 29% to $9.5 million, down from $13.4 million in the first quarter of 2008. This decrease primarily reflects lower volumes of waste disposed in the first quarter of 2009 compared to the same period in 2008.
Selling, General and Administrative (“SG&A”). As a percentage of total revenue, SG&A expenses for the first quarter of 2009 and 2008 were 10% and 9%, respectively. SG&A expenses decreased 9% to $3.6 million, down from $3.9 million for the first quarter of 2008. The decline in SG&A expense was due primarily to lower incentive compensation and business development costs, partially offset by higher professional service fees.
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American Ecology Corporation through its subsidiaries provide radioactive and hazardous materials management services to commercial and government entities such as nuclear power plants medical and academic institutions and petro-chemical facilities. Headquartered in Boise Idaho the Company is one of the nation's oldest radioactive and hazardous chemical waste companies. The Company currently operates in multiple states. American Ecology Corp. has a market cap of $302.3 million; its shares were traded at around $16.52 with a P/E ratio of 14.1 and P/S ratio of 1.7. The dividend yield of American Ecology Corp. stocks is 4.4%. American Ecology Corp. had an annual average earning growth of 31.7% over the past 5 years.
Highlight of Business Operations:
Revenue - Revenue decreased 24% to $35.0 million for the first quarter of 2009, down from $46.2 million for the first quarter of 2008. This reflects lower treatment and disposal revenue as well as lower transportation revenue in the first quarter of 2009 compared to the first quarter of 2008, which we believe was significantly influenced by adverse economic conditions. In the first quarter of 2009, we disposed of 213,000 tons of waste, down 38% from the 343,000 tons disposed in the first quarter of 2008. This volume decline was partially offset by a 42% increase in average selling price for treatment and disposal services (excluding transportation) in the first quarter of 2009 over the same quarter last year. This increase in average selling price primarily reflects pricing for the thermal desorption and recycling service introduced at our Robstown, TX facility in the second half of 2008.Treatment and disposal revenue from private clean-up customers decreased approximately 31% in the first quarter of 2009 as compared to the same period last year. This decline reflects decreased shipments from the Molycorp, Honeywell Jersey City and other smaller projects in the first quarter of 2009 compared to the same period in 2008. We believe that fewer new clean-up opportunities were identified and more previously identified projects were delayed in the first quarter of 2009 than the same quarter last year as a result of the adverse economic conditions which emerged in the second half of 2008 and continued in 2009. The Honeywell Jersey City project contributed 44% of total revenue (including transportation) in the first quarter of 2009 and 38% of total revenue (including transportation) in the first quarter of 2008, or $15.4 million and $17.3 million, respectively. Shipments under our bundled transportation and disposal contract with Chevron/Molycorp which is near completion contributed 4% of total revenue (including transportation) in the first quarter of 2009, or $1.5 million, compared to 8% of total revenue (including transportation) or $3.5 million in the first quarter of 2008.
Government clean-up business revenue decreased 36% in the first quarter of 2009 compared to the first quarter of 2008. This decline reflects a decrease in Event Business under our contract with the U.S. Army Corps of Engineers (“USACE”), which contributed $2.2 million or 6% of total revenue in the first quarter of 2009, compared to $3.8 million or 8% of total revenue in the first quarter of 2008. This quarterly decrease reflects completion of a major project phase at one site in the first quarter of 2008, partially offset by shipments from two other projects sites in the first quarter of 2009. This variability is consistent with project-specific timing at the multiple USACE clean-up sites we serve. Each such site typically is remediated over multiple years in discretely funded project phases. These phases vary by amount of waste received and duration. No USACE projects served by the Company were cancelled or awarded to competitors during the quarter. We believe timing of USACE work in the first quarter of 2009 was also affected by delayed enactment of full-year funding for the fiscal year 2009 federal budget.
Gross Profit. Gross profit for the first quarter of 2009 decreased by 29% to $9.5 million, down from $13.4 million in the first quarter of 2008. This decrease primarily reflects lower volumes of waste disposed in the first quarter of 2009 compared to the same period in 2008.
Selling, General and Administrative (“SG&A”). As a percentage of total revenue, SG&A expenses for the first quarter of 2009 and 2008 were 10% and 9%, respectively. SG&A expenses decreased 9% to $3.6 million, down from $3.9 million for the first quarter of 2008. The decline in SG&A expense was due primarily to lower incentive compensation and business development costs, partially offset by higher professional service fees.
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