Hudson Technologies Inc (HDSN) Reports 15% Decrease in Q3 Revenues
Hudson Technologies Inc (NASDAQ:HDSN) reported a 15% decrease in Q3 revenues compared to the same period in 2022.
Net income for the quarter was $13.6 million, compared to $29.4 million in Q3 2022.
The company fully paid off its remaining $32.5 million of term loan debt during Q3 2023.
Stockholders equity improved to $224.6 million at the end of Q3 2023, compared to $174.9 million at the end of 2022.
Hudson Technologies Inc (NASDAQ:HDSN) released its Q3 earnings report on November 1, 2023. The company reported a 15% decrease in revenues, from $89.5 million in Q3 2022 to $76.5 million in Q3 2023. The decrease was primarily due to lower selling prices for certain refrigerants, partially offset by increased refrigerant sales volume and revenues from the companys Defense Logistics Agency (DLA) program.
Financial Performance
The company's gross margin in Q3 2023 was 40%, compared to 49% in the same period in 2022. Operating income was reported at $23.1 million, a decrease from $36.3 million in Q3 2022. Net income for the quarter was $13.6 million, compared to $29.4 million in the same period last year.
For the first nine months of 2023, Hudson reported revenues of $244.2 million, a decrease of 12% compared to revenues of $277.8 million in the same period in 2022. The company recorded net income of $48.3 million for the first nine months of 2023, compared to net income of $98.7 million in the same period in 2022.
Debt Repayment and Equity Improvement
Hudson fully paid off its remaining $32.5 million of term loan debt during Q3 2023. The company's stockholders equity improved to $224.6 million at the end of Q3 2023, compared to $174.9 million at the end of 2022.
CEO Commentary
Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies, commented, The close of the third quarter marks the end of the traditional nine-month cooling season, and as expected, our results continued to see a difficult comparison to the significantly strong revenue and margin performance achieved in 2022. Nonetheless, we delivered solid third quarter results and our ability to drive profitability and strong cash flow enabled us to aggressively pay down our debt during the last 15 months, saving over $10 million of annualized interest expense, and culminating with the full repayment of our term loan during the quarter."
Future Outlook
As the industry prepares for the mandated 40% reduction in baseline HFC production, effective at the start of 2024, Hudson Technologies is well-positioned with its proprietary reclamation technology to meet the ongoing refrigerant needs of its customer base. The company expects the reduction in virgin HFC production to significantly impact the supply landscape, creating enhanced demand for reclaimed refrigerant.
Explore the complete 8-K earnings release (here) from Hudson Technologies Inc for further details.
This article first appeared on GuruFocus.
