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KMG Chemicals Reports Preliminary Second Quarter Highlights and Schedules Second Quarter News Release and Conference Call For Monday, March 8thHOUSTON, TX – February 18, 2010 – KMG Chemicals, Inc. (NASDAQ: KMGB), a global provider of specialty chemicals in carefully focused markets, today announced preliminary sales and earnings expectations for the second fiscal quarter ended January 31, 2010. The Company anticipates net income and earnings per share for the quarter to increase approximately 300% from the $903,000 or $0.08 per diluted share reported in the second quarter of last year, on marginally higher revenues. Neal Butler, President and CEO of KMG, commented, “We are very pleased with our results for the second quarter, which historically has been KMG’s seasonally slowest quarter. Our Electronic Chemicals business maintained strong sales approximating those of our first quarter, despite the slowdown typical of the holiday season. We continue to see a gradual but steady return to more normalized demand in our North American, European and Middle Eastern markets. Margins in this business expanded in the second quarter versus the first quarter, due to the continued impact of previously implemented efficiency improvement initiatives combined with the operating leverage that is now present in the business.” He added, “In our Wood Treating Chemicals business, product mix continued to favorably impact operating profits in the current second quarter versus the same period last year, although we experienced an anticipated easing in customer demand, as previously disclosed. We continue to see softness in this market in both the utility pole and rail tie treating segments. Our Animal Health business had a good start to its main selling season in January and revenues were incrementally better this quarter than the previous year; however, with a better cost structure, our margins improved considerably.” Mr. Butler concluded, “In the second quarter, we continued to experience the positive residual effects of the efficiency improvement initiatives previously implemented. This, along with our reduced debt structure and excellent liquidity, has positioned KMG very well for its next acquisition, which we expect to close this fiscal year.”
Second
Quarter Results & Conference Call The conference call will also be webcast live via the “Investor Relations” section of the Company’s website at www.kmgchemicals.com. To listen to the live call please go to the website at least 15 minutes early to register, download and install any necessary audio software. If you are unable to listen live, the conference call will be archived on the website.
Roth Capital
Partners 22nd Annual OC Growth Stock Conference About KMG KMG
Chemicals, Inc., through its subsidiaries, produces and distributes
specialty chemicals to carefully focused markets.
The Company grows by
acquiring and optimizing stable chemical product lines and
businesses with established production processes. Its current operations are
focused on the wood treatment, electronic, and agricultural chemical
markets.
For more
information, visit the Company's web site at www.kmgchemicals.com. The information in this
news release includes certain forward-looking statements that are
based upon assumptions that in the future may prove not to have been
accurate and are subject to significant risks and uncertainties,
including statements as to the future performance of the company.
Although the company believes that the expectations reflected in its
forward-looking statements are reasonable, it can give no assurance
that such expectations or any of its forward-looking statements will
prove to be correct. Factors that could cause results to differ
include, but are not limited to, successful performance of internal
plans, product development acceptance, the impact of competitive
services and pricing and general economic risks and
uncertainties.
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