Shares of Hudson Technologies Inc. (NASDAQ: HDSN), a refrigerant services company providing solutions to recurring problems within the refrigeration industry, surged on Thursday after the Pearl River, New York-based company reported its financial results for the third quarter.
For the quarter ended September 30, 2013, Hudson Technologies reported revenue of $15.2 million, compared to $14.5 million reported for the same period in the previous year.
HDSN reported an operating loss of $14.4 million for the quarter, compared to an operating income of $3.7 million reported for the same period in the previous year. The company reported an operating loss for the quarter as it recorded a lower-of-cost-or-market inventory adjustment of $14.7 million. The adjustment was mainly due to around 50% drop in R-22 pricing from March to September 2013 after the issuance of the EPA’s final rule in April 2013, which allowed higher-than-expected virgin R-22 allowances for 2013 and 2014. The LCM inventory adjusted significantly increased the company’s cost of sales.
Hudson Technologies registered a net loss of $9.1 million, or $0.36 per share for the quarter. This compares to net income of $2.2 million, or $0.09 per basic share reported for the same period in the previous year. Excluding the LCM adjustment, Hudson Technologies’ non-GAAP gross profit for the quarter was $2.1 million.
For the nine-month period ended September 30, 2013, Hudson Technologies reported a 4% increase in revenue to $53.8 million.
Kevin J. Zugibe, Chairman and CEO of Hudson Technologies, said that R-22 prices have dropped by 50% following the EPA’s issuance of its final rule in April this year, adversely impacting the value of the company’s inventory and causing it to record a large write down in the form of an LCM inventory adjustment. Zugibe further said that the company had been operating under the belief that the EPA was applying a step-down approach to the phase-out of R-22. He added that in spite of the EPA’s actions, the company was able to achieve modest growth in both revenues and volumes during the later part of 2013 selling season.
Following the release of strong quarterly results, HDSN shares surged to an intra-day high of $2.20 on Thursday. The stock pared some of its gains in late trading on Thursday to finish the day 20.41% higher at $2.13.
Thursday’s huge rally allowed HDSN shares to pare some of their losses for the year. The stock, however, is still down nearly 41.50% in 2013 so far. The sharp decline in HDSN shares came after the April ruling. However, on Thursday, HDSN shares broke through some key technical levels, indicating that market sentiment has finally turned bullish on the stock. HDSN shares broke through $2 resistance level and also crossed above their 50-day moving average, which is a bullish signal. The stock’s MACD also crossed above the signal line. HDSN shares could face resistance at around $2.20. However, if the stock breaks through this level then there could be significant upside potential.
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For the quarter ended September 30, 2013, Hudson Technologies reported revenue of $15.2 million, compared to $14.5 million reported for the same period in the previous year.
HDSN reported an operating loss of $14.4 million for the quarter, compared to an operating income of $3.7 million reported for the same period in the previous year. The company reported an operating loss for the quarter as it recorded a lower-of-cost-or-market inventory adjustment of $14.7 million. The adjustment was mainly due to around 50% drop in R-22 pricing from March to September 2013 after the issuance of the EPA’s final rule in April 2013, which allowed higher-than-expected virgin R-22 allowances for 2013 and 2014. The LCM inventory adjusted significantly increased the company’s cost of sales.
Hudson Technologies registered a net loss of $9.1 million, or $0.36 per share for the quarter. This compares to net income of $2.2 million, or $0.09 per basic share reported for the same period in the previous year. Excluding the LCM adjustment, Hudson Technologies’ non-GAAP gross profit for the quarter was $2.1 million.
For the nine-month period ended September 30, 2013, Hudson Technologies reported a 4% increase in revenue to $53.8 million.
Kevin J. Zugibe, Chairman and CEO of Hudson Technologies, said that R-22 prices have dropped by 50% following the EPA’s issuance of its final rule in April this year, adversely impacting the value of the company’s inventory and causing it to record a large write down in the form of an LCM inventory adjustment. Zugibe further said that the company had been operating under the belief that the EPA was applying a step-down approach to the phase-out of R-22. He added that in spite of the EPA’s actions, the company was able to achieve modest growth in both revenues and volumes during the later part of 2013 selling season.
Following the release of strong quarterly results, HDSN shares surged to an intra-day high of $2.20 on Thursday. The stock pared some of its gains in late trading on Thursday to finish the day 20.41% higher at $2.13.
Thursday’s huge rally allowed HDSN shares to pare some of their losses for the year. The stock, however, is still down nearly 41.50% in 2013 so far. The sharp decline in HDSN shares came after the April ruling. However, on Thursday, HDSN shares broke through some key technical levels, indicating that market sentiment has finally turned bullish on the stock. HDSN shares broke through $2 resistance level and also crossed above their 50-day moving average, which is a bullish signal. The stock’s MACD also crossed above the signal line. HDSN shares could face resistance at around $2.20. However, if the stock breaks through this level then there could be significant upside potential.
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