The recent financial challenges that Perma-Fix Chairman and President Lou Centofanti called the “one of the most challenging fiscal environments in the company’s history” continued to impact the second quarter of 2013, with the company reporting revenues for that period yesterday as down to $22.8 million, compared to $33.7 million for the same period last year. However recent cost reductions, including layoffs, led to a decrease in operating loss for the quarter; Perma-Fix reported in filings with the Securities and Exchange Commission Aug. 7 that operating loss fell to $898,000 for the second quarter of 2013, compared to a loss of $1.2 million in the same period of 2012. Notably, a non-cash, goodwill impairment charge of approximately $1.1 million, related to the expiration of the CH Plateau Remediation Company contract at Hanford, was levied in the quarter and kept Perma-Fix from posting positive net income. “The financial and operational measures we took in the fourth quarter of 2012 and the first quarter of this year are beginning to show positive results,” Centofanti said in a call with investors. “In addition we believe the funding environment is beginning to improve. We have been awarded small projects and we’re actively bidding on many projects.”
Perma-Fix’s services segment revenues were sliced nearly in half, falling to $12.7 million in the second quarter of 2013 compared to $23.7 million for the same period in 2012. “New projects were smaller in scope and failed to replace the sizeable projects which were completed in the past year,” Ben Naccarato, CFO of Perma-Fix, said during the call. “We also saw a modest decrease in our Hanford contract and revenue from our engineering group was flat.” A higher-margin treatment mix in the second quarter allowed Perma-Fix to maintain flat net revenue in its treatment segment, to $10.1 million compared to $10 million in the same quarter of 2012. “Gross margin increased to 17.7 percent from 11.7 percent for the same period last year primarily due to expense reductions in both segments as we continue to focus on efficiencies within our operations and administrative infrastructure,” the company wrote in a release yesterday. Perma-Fix said it is placing much optimism in the foreign markets, in particular bidding on cleanup projects in Canada over the next several years, and deploying the company’s medical isotope technologies in emerging international markets while R&D on that technology continues to bring it up to North American standards.
