INNOPHOS HOLDINGS, INC. (IPHS, Financial) filed Quarterly Report for the period ended 2009-06-30.
Innophos Inc. is one of the leading North American manufacturers of specialty phosphates serving a diverse range of customers across multiple applications geographies and channels. Innophos offers a broad suite of products used in a wide variety of food and beverage consumer products pharmaceutical and industrial applications. Innophos\' market-leading positions derive from its experience and dedication to customer service and innovation. INNOPHOS HOLDINGS, INC. has a market cap of $375 million; its shares were traded at around $17.65 with a P/E ratio of 1.8 and P/S ratio of 0.4. The dividend yield of INNOPHOS HOLDINGS, INC. stocks is 3.8%.
Operating expenses consist primarily of selling, general and administrative, and R&D expenses. For the three months ended June 30, 2009, these costs were $18.0 million, an increase of $0.1 million, or 0.6%, as compared to $17.9 million for the same period in 2008. The increase is primarily due to $2.1 million for our enterprise resource planning system and business redesign project (ERP), $0.6 million increase in legal expenses related to our OCP arbitration, and $0.4 million Mexican workforce reduction costs mostly offset by $0.8 million favorable exchange rate impact mostly from our Mexican peso based costs, $0.9 million lower professional fees used to support growth and other corporate initiatives, $0.4 million short-term incentive program accruals, and $0.9 million reduction in all other costs.
Net interest expense, including deferred financing amortization expense, for the three months ended June 30, 2009 was $3.6 million, a decrease of $4.8 million, compared to $8.4 million for the same period in 2008. This decrease is primarily due to a gain of $3.5 million on the retirement of $10.0 million of the 9.5% Senior Unsecured Notes due April 2012, lower average interest rates and the lower average balance of our Term Loan resulting from the $54.0 million principal payments made in March 2009 mostly to satisfy the excess cash flow requirement of our credit agreement and the $72.5 million payment in May 2009 to pay off the remaining
Gross profit represents net sales less cost of goods sold. Gross profit for the six months ended June 30, 2009 was $119.2 million, a decrease of $29.4 million, or 19.8%, as compared to $148.6 million for the same period in 2008. Gross margin decreased to 33.3% for the six months ended June 30, 2009 versus 34.8% for the same period in 2008. The change in gross profit was due to unfavorable sales volume and mix impact upon revenue and higher raw material costs, which had a combined unfavorable impact of $165.8 million. Gross profit was negatively impacted by a $1.8 million inventory write-down of GTSP. Also, as a result of reduced operating rates in Mexico, the company took a charge of $1.6 million for Mexican workforce reduction costs and a charge of $2.5 million for anticipated unfulfilled contractual natural gas purchase commitments, including the unfavorable variance to current market prices, expiring in December 2009. These unfavorable effects were partially offset by higher selling prices which had a favorable impact of $129.8 million, $6.7 million favorable exchange rate impact mostly from our Mexican peso based costs, $1.2 million favorable inventory re-pricing, and $2.0 million lower depreciation expense. The favorable inventory re-pricing resulted from volumes being sold at 2008 carrying costs which were replaced by higher 2009 raw material costs. Included in 2008 results were $1.3 million
Operating expenses consist primarily of selling, general and administrative, and R&D expenses. For the six months ended June 30, 2009, these costs were $32.5 million, a decrease of $2.7 million, or 7.7%, as compared to $35.2 million for the same period in 2008. The decrease is due to $2.1 million lower legal and other fees which were incurred in 2008 to comply with the DOJ STPP document request subpoena, $2.2 million lower professional fees used to support growth and other corporate initiatives, $1.3 million lower short-term incentive program accruals, and $1.5 million favorable exchange rate impact from our Mexican peso based costs, partially offset by $1.5 million increased legal expenses related to our OCP arbitration, $2.3 million for our enterprise resource planning system and business redesign project (ERP), $0.4 million Mexican workforce reduction costs ,and $0.2 million increase in all other costs.
Net interest expense, including deferred financing amortization expense, for the six months ended June 30, 2009 was $11.3 million, a decrease of $5.8 million, compared to $17.1 million for the same period in 2008. This decrease is primarily due to a gain of $3.5 million on the retirement of $10.0 million of the 9.5% Senior Unsecured Notes due April 2012, lower average interest rates and the lower average balance of our Term Loan resulting from the $54.0 million principal payments made in March 2009 mostly to satisfy the excess cash flow requirement of our credit agreement and the $72.5 million payment in May 2009 to pay off the balance of the Term Loan. These decreases were partially offset by accelerated deferred financing related to the excess cash flow payment and the pay off of the Term Loan.
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Innophos Inc. is one of the leading North American manufacturers of specialty phosphates serving a diverse range of customers across multiple applications geographies and channels. Innophos offers a broad suite of products used in a wide variety of food and beverage consumer products pharmaceutical and industrial applications. Innophos\' market-leading positions derive from its experience and dedication to customer service and innovation. INNOPHOS HOLDINGS, INC. has a market cap of $375 million; its shares were traded at around $17.65 with a P/E ratio of 1.8 and P/S ratio of 0.4. The dividend yield of INNOPHOS HOLDINGS, INC. stocks is 3.8%.
Highlight of Business Operations:
Gross profit represents net sales less cost of goods sold. Gross profit for the three months ended June 30, 2009 was $49.4 million, a decrease of $58.5 million, or 54.2%, as compared to $107.9 million for the same period in 2008. Gross margin decreased to 29.6% for the three months ended June 30, 2009 versus 40.9% for the same period in 2008. The change in gross profit was due to unfavorable sales volume and mix impact upon revenue and higher raw material costs, which had a combined unfavorable impact of $54.6 million. Gross profit was negatively impacted by a $1.8 million inventory write-down of granular triple super-phosphate, or GTSP. Also, as a result of reduced operating rates in Mexico, the company took a charge of $1.2 million for Mexican workforce reduction costs and a charge of $2.5 million for anticipated unfulfilled contractual natural gas purchase commitments, including the unfavorable variance to current market prices, expiring in December 2009. These unfavorable affects were partially offset by higher selling prices which had a favorable impact of $4.9 million, $3.3 million favorable exchange rate impact mostly from our Mexican peso based costs, and $1.0 million lower depreciation expense. Included in the 2008 second quarter results were favorable $6.6 million of pricing settlements that were applicable to the 2008 first quarter volumes, $3.6 million of gross profit from one GTSP export shipment delayed from March into April due to a customers ocean shipping logistics issues, $1.3 million expense for a scheduled Geismar, LA plant maintenance outage, and $1.3 million asset impairment charge for two obsolete production units.Operating expenses consist primarily of selling, general and administrative, and R&D expenses. For the three months ended June 30, 2009, these costs were $18.0 million, an increase of $0.1 million, or 0.6%, as compared to $17.9 million for the same period in 2008. The increase is primarily due to $2.1 million for our enterprise resource planning system and business redesign project (ERP), $0.6 million increase in legal expenses related to our OCP arbitration, and $0.4 million Mexican workforce reduction costs mostly offset by $0.8 million favorable exchange rate impact mostly from our Mexican peso based costs, $0.9 million lower professional fees used to support growth and other corporate initiatives, $0.4 million short-term incentive program accruals, and $0.9 million reduction in all other costs.
Net interest expense, including deferred financing amortization expense, for the three months ended June 30, 2009 was $3.6 million, a decrease of $4.8 million, compared to $8.4 million for the same period in 2008. This decrease is primarily due to a gain of $3.5 million on the retirement of $10.0 million of the 9.5% Senior Unsecured Notes due April 2012, lower average interest rates and the lower average balance of our Term Loan resulting from the $54.0 million principal payments made in March 2009 mostly to satisfy the excess cash flow requirement of our credit agreement and the $72.5 million payment in May 2009 to pay off the remaining
Gross profit represents net sales less cost of goods sold. Gross profit for the six months ended June 30, 2009 was $119.2 million, a decrease of $29.4 million, or 19.8%, as compared to $148.6 million for the same period in 2008. Gross margin decreased to 33.3% for the six months ended June 30, 2009 versus 34.8% for the same period in 2008. The change in gross profit was due to unfavorable sales volume and mix impact upon revenue and higher raw material costs, which had a combined unfavorable impact of $165.8 million. Gross profit was negatively impacted by a $1.8 million inventory write-down of GTSP. Also, as a result of reduced operating rates in Mexico, the company took a charge of $1.6 million for Mexican workforce reduction costs and a charge of $2.5 million for anticipated unfulfilled contractual natural gas purchase commitments, including the unfavorable variance to current market prices, expiring in December 2009. These unfavorable effects were partially offset by higher selling prices which had a favorable impact of $129.8 million, $6.7 million favorable exchange rate impact mostly from our Mexican peso based costs, $1.2 million favorable inventory re-pricing, and $2.0 million lower depreciation expense. The favorable inventory re-pricing resulted from volumes being sold at 2008 carrying costs which were replaced by higher 2009 raw material costs. Included in 2008 results were $1.3 million
Operating expenses consist primarily of selling, general and administrative, and R&D expenses. For the six months ended June 30, 2009, these costs were $32.5 million, a decrease of $2.7 million, or 7.7%, as compared to $35.2 million for the same period in 2008. The decrease is due to $2.1 million lower legal and other fees which were incurred in 2008 to comply with the DOJ STPP document request subpoena, $2.2 million lower professional fees used to support growth and other corporate initiatives, $1.3 million lower short-term incentive program accruals, and $1.5 million favorable exchange rate impact from our Mexican peso based costs, partially offset by $1.5 million increased legal expenses related to our OCP arbitration, $2.3 million for our enterprise resource planning system and business redesign project (ERP), $0.4 million Mexican workforce reduction costs ,and $0.2 million increase in all other costs.
Net interest expense, including deferred financing amortization expense, for the six months ended June 30, 2009 was $11.3 million, a decrease of $5.8 million, compared to $17.1 million for the same period in 2008. This decrease is primarily due to a gain of $3.5 million on the retirement of $10.0 million of the 9.5% Senior Unsecured Notes due April 2012, lower average interest rates and the lower average balance of our Term Loan resulting from the $54.0 million principal payments made in March 2009 mostly to satisfy the excess cash flow requirement of our credit agreement and the $72.5 million payment in May 2009 to pay off the balance of the Term Loan. These decreases were partially offset by accelerated deferred financing related to the excess cash flow payment and the pay off of the Term Loan.
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