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[February 2007]
CARBO Ceramics Announces Record Quarterly and Full Year Earnings
CARBO Ceramics Inc (Irving, TX, USA) has announced record quarterly net income of US$15 million on record revenues of US$87 million for the quarter ended 31 December 2006. Revenues for the quarter increased 37% while net income increased 44% compared to the fourth quarter of 2005.For the year ended 31 December 2006, the company reported record net income of US$54.3 million on record annual revenues of US$312.1 million. Revenues and net income for the full year 2006 increased 24% and 1%, respectively, compared to the full year 2005. Full year 2006 results represent the fourth consecutive year in which the company established a new record for revenues and net income.
President and CEO Gary Kolstad commented on the quarter and full year results stating: "We are very pleased with the new revenue and net income records established for both the fourth quarter and full year 2006. This outstanding performance was the direct result of our continued investment in new proppant manufacturing capacity and in the technologies that extend the application of our fracture mapping and reservoir monitoring services offered through Pinnacle Technologies".
Looking to the future, Gary Kolstad added: "The oil and gas industry will continue to experience normal business cycles, and we caution that high natural gas inventories in the U.S. may impact drilling activity in North America in the first half of 2007. However, we believe that any downturn in North American drilling activity will be relatively short-lived, and therefore our plans for the future are unchanged. We are the technology leaders in supplying high-conductivity proppant and in fracture mapping technology, and we will continue to invest in these businesses to expand our technical capabilities and production capacity. We are actively expanding our marketing capabilities globally, and are working to integrate our product and service offerings to address the specific needs of both oilfield service companies and the companies that explore for and produce oil and gas around the world. Our twelve proppant production lines operating at five locations in the U.S. and China allow us a great deal of flexibility to adjust output to match demand."
In 2007, the company expects to complete the construction of its manufacturing facility in Kopyesk, Russia and the expansion of its facility in Toomsboro, Georgia, USA. As a result of these activities, additional capital spending for Pinnacle tools, normal maintenance capital expenditures and expansion of distribution facilities, total capital spending for 2007 should range from US$70 million to US$75 million. By the end of 2007, the company expects to have expanded its proppant manufacturing capacity by 80% in a two-year period. The increased investment will result in an increase in depreciation and amortisation expense to approximately US$25 million in 2007. The company also expects that as it continues to expand globally it will see selling, general and administrative expenses as a percentage of revenue similar to that of the fourth quarter of 2006. The company further indicated that expenses associated with the start-up of its facility in Russia should be approximately US$500,000 in the first half of the year, provided all necessary permits are received in a timely fashion.
www.carboceramics.com
ENDS