SCOTTSDALE, Ariz., May 13, 2013 /PRNewswire/ -- Abtech Holdings, Inc. (OTC QB: ABHD) ("AbTech" or the "Company"), a full-service environmental technologies and engineering firm dedicated to providing innovative solutions to communities, industry and governments addressing issues of water pollution and contamination, today reported financial results for its first quarter ended March 31, 2013. Since the beginning of the year, AbTech has:
- received stormwater RFP awards totaling $563,000 with current active bids pending on domestic stormwater projects in excess of $10 million;
- developed a $3 million pipeline of industrial water treatment projects in Europe which are currently in the contract stage;
- signed four oil and gas service company teaming agreements with multiple additional teaming, licensing and distribution agreements in various stages of negotiation;
- designed Smart Sponge® treatment units into the trailer systems expected to be deployed by a major oil field services provider,
- established an oil and gas project pipeline with immediate proposals totaling $870,000 for which contracts are expected to be awarded over the next 90 days, and additional projects are expected to be added to the pipeline with award decisions expected in the second half of this year;
- strengthened its balance sheet with the conversion of $1.9 million of debt into common stock, reduced total debt to approximately $480,000; and
- received the Water Management Company of the Year award at the March 2013 Gulf Coast Oil & Gas Awards.
"In the stormwater market we are methodically following a strategy that we believe will result in the awarding of material projects in the near term. As previously mentioned in the fourth quarter 2012, several factors, including planning, regulatory and permitting issues, persuaded cities to delay decisions and, consequently, extend the sales cycle beyond our original expectation. These factors have largely been resolved. Throughout this period, we have worked closely with prospective customers to help them through the process, and we believe additional projects are now imminent," stated Glenn Rink, founder and CEO of AbTech. "The demand for total water treatment solutions across all our business segments is quite active. AbTech's integrated approach to providing complete water management solutions is in the early stages of achieving recognition in a growing, global opportunity."
AbTech reported revenues for the three months ended March 31, 2013 of approximately $100,000 compared to $240,000 for the same period of the previous year and $156,000 in the fourth quarter of 2012. AbTech's current backlog which it expects to book in the second quarter, totals $563,000 and is growing, as is the Company's business proposal pipeline.
The Company reported a net loss attributable to controlling interest of $(1.2) million or $(0.02) per basic share for the three months ended March 31, 2013. This compares to a net loss attributable to controlling interest of $(2.7) million or $(0.06) per basic share for the three months ended March 31, 2012 and $(1.7) million or $(0.02) per basic share for the fourth quarter 2012. AbTech incurred a loss from operations of $(1.4) million for the three months ended March 31, 2013 versus a loss from operations of $(996,000) in the same period of the prior year and a loss from operations of $(1.6) million in the fourth quarter 2012.
AbTech operated at approximately 3 percent of operating capacity during the three months ended March 31, 2013, which adversely affected gross margins, as excess capacity costs flowed through to cost of revenues. The Company continues to expect high gross margins for its Smart Sponge® product as it achieves a critical mass in its business activity. However it should be noted that ancillary and complimentary products and services offered to our customers would likely produce varying margins depending on the product or service and the market segment.
Operating expenses for the three months ended March 31, 2013 totaled $1.4 million, an increase of approximately $338,000 over the same period of 2012 and a decrease of approximately $255,000 compared to the fourth quarter of 2012. A significant portion of the year over year increase was attributed to an expanded business development effort, including approximately $126,000 in operating costs associated with the Company's engineering subsidiary AEWS. As AbTech's business grows, operating expenses will be managed to maximize operating margins.
The Company substantially lowered its interest expense for the three months ended March 31, 2013 to $12,000, compared to $884,000 in the same period of 2012 and $483,000 in the fourth quarter of 2012. During 2012, the Company eliminated approximately $6.8 million of convertible promissory notes. The interest rate on the $480,000 of short term convertible notes outstanding at March 31, 2013 was reduced, through mutual consent of the Company and note holder, from 12% to 6% per annum beginning January 1, 2013.
At March 31, 2013, the Company reported cash and cash equivalents of $1.2 million, accounts receivable of $90,000 and inventory of $452,000. On March 31, 2013, the Company's short term debt totaled approximately $2.2 million, and long term debt totaled approximately $307,000. The Company reduced its total debt by approximately $4.1 million during the fourth quarter of 2012. Then, on April 11, 2013, subsequent to the end of the first quarter, the Company eliminated an additional $1.9 million of non-interest bearing notes through conversion into approximately 2.6 million shares of the Company's common stock.
On March 31, 2013, AbTech common stock outstanding totaled approximately 64.8 million shares, compared to 64.6 million shares at December 31, 2012. The Company's fully diluted share count decreased by approximately 631,000 during the first quarter of 2013 to approximately 91.4 million (inclusive of all options, warrants and convertible debt) due primarily to the cashless exercise of warrants. If all remaining outstanding options and warrants were exercised for cash, the Company would receive approximately $10 million in additional capital.
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