Environmental Elements earns 5 cents a share

1997 quarterly loss reversed through sales, cost controls, backlog

Area manufacturing

February 03, 1999|By William Patalon III | William Patalon III,SUN STAFF

Environmental Elements Corp., a Baltimore-based firm that designs and builds air pollution control systems, yesterday reported net income of $351,000, or 5 cents per diluted share, for its third quarter that ended Dec. 31.

For the corresponding period a year earlier, Environmental Elements posted a loss of $145,000, or 2 cents per share.

Environmental Elements Chairman and Chief Executive Officer E. H. "Ted" Verdery said the company has been controlling costs and is finally seeing growth in its order backlog -- a key measure of a manufacturing company's health.

"We could be in a very good position" if current trends continue, Verdery said.

Sales increased 37 percent to $17 million in the third quarter, from $12.4 million the year before. Sales, general and administrative expenses -- essentially, a company's overhead costs -- held steady at $1.8 million.

In the first nine months of the year, the company said, it earned $904,000, or 13 cents per share, vs. a loss of $103,000, or 1 cent per diluted share. Sales rose 44 percent to $54.3 million from $37.8 million in the quarter that ended in December 1997.

The company said its backlog -- work that has been ordered but not completed -- grew by $4 million since September.

The backlog at the close of the third quarter was $54 million, still below the $60.7 million backlog the company enjoyed at the close of its December quarter in 1997.

Verdery said new federal air pollution regulations will begin forcing utilities with coal-fired power plants to upgrade their pollution-control systems to reduce the levels of smog emitted from their exhaust stacks. And that should increase orders for Environmental Elements.

With more orders, the company, which employs about 160 to 170 people primarily in Baltimore, could begin hiring, Verdery said.

Environmental Elements shares closed at $3 yesterday, down 12.5 cents.

Pub Date: 2/03/99

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