Detrex Corporation (Pink Sheets: DTRX), today announced 2013 third quarter net income of $796,768, or $0.46 per fully diluted share, compared to net income of $363,235, or $0.21 per fully diluted share in the third quarter of 2012. Year-to-date 2013 net income was $2,749,920, or $1.59 per fully diluted share, compared to net income of $18,218,730, or $10.58 per fully diluted share for the year-to-date period in 2012. The 2012 net income includes net income from discontinued operations related to the sale of the Company's Harvel Plastics, Inc. subsidiary. The third quarter 2012 loss from discontinued operations was $85,191 and the year-to-date gain was $16,459,353. The Company also announced that it will pay a $0.25 quarterly dividend on December 12, 2013 to shareholders of record as of November 29, 2013.

Third quarter sales of $10.1 million were approximately the same as in the comparable period last year. This sales level is approximately $1 million below the sales in the first and second quarters of this year due to market conditions that softened near the end of the second quarter. Year-to-date sales in 2013 are $32.5 million compared to $33.5 million in the same period last year. The year-over-year shortfall is primarily the result of sales to a major customer that began to decline after the first quarter of 2012. Sales to new and existing customers have partially offset this reduction in sales.

The 2013 pre-tax income from continuing operations of $0.9 million for the quarter and $3.9 million year-to-date are higher than the corresponding $0.7 million and $2.8 million of 2012 primarily due to the absence of provisions for environmental expense. In 2012 the provisions for environmental expense were $0.6 million for the third quarter and $1.8 million for the year-to-date. The Company increased the reserve for environmental liabilities to $17.0 million in the fourth quarter of 2012 as the result of an in-depth evaluation of these liabilities. The majority of the liabilities were transferred to a third party in a June 2013 transaction. The savings from eliminating the environmental provision have been partially offset by increases in manufacturing costs, depreciation and amortization, interest expense, as well as non-recurrence of a legal expense recovery in 2012.

"Elco is performing well in the market for industrial lubricant additives in spite of soft conditions. We are continuing to invest in product development and organizational capabilities that will provide new opportunities," said Detrex President and CEO, Tom Mark. "Management and the Board continue to investigate opportunities to enhance shareholder value."

About Detrex Corporation

Founded in 1925, Detrex Corporation through its subsidiary The Elco Corporation is a leading manufacturer of high performance specialty chemicals including additives for industrial petroleum products and high purity hydrochloric acid.

Forward Looking Statements

Statements included in this press release that are not historical in nature are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "1995 Act"). The words "believe," "expect," "anticipate," "estimate," "guidance," "target" and similar expressions identify forward-looking statements. The Company cautions readers that forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those projected in the forward-looking statements. Certain risks and uncertainties are identified from time to time in the Company's reports. Some factors that could cause results to differ materially from those projected in the forward-looking statements include: market conditions, environmental remediation costs, pension expense and funding requirements, liquidation value of assets, and marketability of real estate and the market value and future liquidity of Detrex stock. The Company claims the protection of the safe harbor for forward-looking statements contained in the 1995 Act.

   
Detrex Corporation and Subsidiaries
Condensed Consolidated Statements of Operations
(unaudited, in thousands)
   
Three Months Ended Year to date
September 30 September 30

2013

2012

2013

2012

 
Net sales $ 10,127 $ 10,102 $ 32,518 $ 33,502
 
Cost of sales 6,616 6,633 21,354 21,984
Selling, general and administrative expense 2,210 2,095 6,245 6,301
Provision for depreciation and amortization 304 289 902 861
Provision for corporate environmental reserves - 600 - 1,800
Interest (Income) Expense 67 (40 ) 85 (55 )
Other (Income) Expense, net   14   (192 )   57   (188 )
Income from continuing operations
before income taxes 916 717 3,875 2,799
 
Provision for income taxes   119   269     1,125   1,039  
Net Income from continuing operations 797 448 2,750 1,760
 
Discontinued operations:
Gain (loss) on sale of Subsidiary, net of tax 0 (85 ) 0 16,459
Income from the operation of Subsidiary, net of income tax
       
Net income $ 797 $ 363   $ 2,750 $ 18,219  
 
Basic earnings per common share attributable to Detrex shareholders:
From continuing operations $ 0.48 $ 0.27 $ 1.64 $ 1.05
From discontinued operations   -   (0.05 )   -   9.82  
Net earnings per share $ 0.48 $ 0.22   $ 1.64 $ 10.87  
 
Fully diluted earnings per common share attributable to Detrex shareholders:
From continuing operations $ 0.46 $ 0.26 $ 1.59 $ 1.02
From discontinued operations   -   (0.05 )   -   9.56  
Net earnings per share $ 0.46 $ 0.21   $ 1.59 $ 10.58  
 

Shares outstanding, basic

1,676 1,676 1,676 1,676

Shares outstanding, fully diluted

1,726 1,721 1,726 1,721
 
 
Condensed Consolidated Balance Sheets
 
Unaudited Audited
Sept 30 Dec 31

2013

2012

Assets
 
Current Assets $ 18,553 $ 21,000
 
Property and equipment, net 10,157 10,433
 
Other assets 1,626 5,858
   
Total assets $ 30,336 $ 37,291  
 
Liabilities and stockholders' equity
 
Current liabilities $ 9,047 $ 8,795
 
Non-current liabilities 8,663 17,363
 
Detrex Corporation shareholders' equity 12,626 11,133
   
Total liabilities and stockholders' equity $ 30,336 $ 37,291  
 

Detrex Corporation
Thomas E. Mark
Phone: (248) 358-5800
FAX: (248) 799-7192