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CARBO Ceramics Inc. recently reported net income of $19.0 million, or $0.82 per diluted share, on revenues of $123.4 million for the quarter ended March 31, 2010. Revenues for the first quarter of 2010 increased 36%, or $32.8 million, compared to the first quarter of 2009. The company’s worldwide proppant sales volume totaled 370 million pounds for the first quarter of 2010, which is a new quarterly record for CARBO and represents a year-over-year increase of 46%. North American proppant sales volume increased 47% year-over-year, while international proppant sales volume increased 45% compared to the same period last year.
“We are pleased with the record results of the first quarter and especially with the increasing economic success our clients are realizing when they use our high-conductivity ceramic proppants,” said Gary Kolstad, president and CEO. “As we pointed out during last quarter’s earnings conference call, we expected proppant sales volume to accelerate in the first quarter of 2010. We were able to meet the increased demand by drawing from our finished goods inventory to augment the output from our manufacturing facilities, which were operating at capacity. The strategy we employed last year, to maintain high levels of production during slow periods, benefitted us this quarter. Separately, we continued with the expansion of our Falcon Technologies business, including securing a contract to apply our lining technology in the down-stream business. We remain confident about the potential that this business has, not only in its existing oilfield applications, but as demonstrated recently with the value that its products and services can bring to other industry segments.”
Operating profit for the first quarter of 2010 increased 18%, or $4.3 million, compared to the first quarter of 2009. This increase is due to higher sales volume experienced during the first quarter of 2010, partially offset by a decrease in average selling price compared to the first quarter of 2009. Selling, general, administrative and other operating expenses for the first quarter of 2010 increased $2.3 million on a year-over-year basis, largely due to the inclusion of the Falcon Technologies business that was acquired in October 2009. Net income for the first quarter of 2010 increased 16%, or $2.6 million, compared to the first quarter of 2009.
“The near-term story for natural gas remains cautious, given the supply-demand situation,” said Kolstad. “It is difficult to say with certainty what market condition the second half of 2010 will provide in natural gas, but given the price of oil, some industry experts expect activity in oil drilling to remain strong. For the next couple of quarters, we would expect our ceramic proppant sales volume to closely match our production capacity. As stated previously, we drew down our finished goods inventory in the first quarter.”
Additional details are available at www.carboceramics.com.