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Hudson Technologies to Host Conference Call to Discuss Third Quarter 2021 Results

PEARL RIVER, NY – October 20, 2021 – Hudson Technologies, Inc. (NASDAQ: HDSN) will host a conference call and webcast on Wednesday, November 3, 2021 at 5:00 p.m. Eastern Time to discuss the Company’s third quarter results.

Click here to access the live webcast.

To participate in the call by phone, dial (888) 506-0062 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use entry code: 720614.

A replay of the teleconference will be available until December 3, 2021 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 43256.


Hudson Technologies Reports Record Second Quarter 2021 Revenues

PEARL RIVER, NY – AUGUST 4, 2021 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the second quarter and six months ended June 30, 2021.

For the quarter ended June 30, 2021, Hudson reported revenues of $60.5 million, an increase of 27% compared to revenues of $47.7 million in the comparable 2020 period. Second quarter revenue growth was driven by increased demand as well as increased selling prices for certain refrigerants during the period. Gross margin in the second quarter of 2021 was 36%, compared to 27% in the second quarter of 2020, mainly due to the aforementioned increase in selling price of certain refrigerants. Hudson reported operating income of $14.4 million in the second quarter of 2021 compared to operating income of $5.2 million in the prior year period. The Company recorded net income of $11.3 million or $0.26 per basic and $0.24 per diluted share in the second quarter of 2021, compared to net income of $2.4 million or $0.06 per basic and diluted share in the same period of 2020.

For the six months ended June 30, 2021 Hudson reported revenues of $94.3 million, an increase of 12% compared to revenues of $84.0 million in the first six months of 2020. The revenue growth was driven by increased demand as well as increased selling prices for certain refrigerants during the period. Gross margin in the first half of 2021 was 33%, compared to 25% in the first half of 2020, mainly due to the aforementioned increase in selling price of certain refrigerants. Hudson reported operating income of $16.1 million for the first six months of 2021 compared to operating income of $5.6 million in the prior year period. The Company recorded net income of $10.2 million or $0.23 per basic and $0.22 per diluted share in the first half of 2021, compared to a net loss of $0.5 million or ($0.01) per basic and diluted share in the same period of 2020.

At June 30, 2021, the Company had approximately $41 million of total availability, consisting of cash and cash equivalents plus revolving loan availability.

Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies commented,
“We are pleased to have delivered strong second quarter results as demonstrated by substantial revenue growth and significantly improved profitability. Our performance was driven by increased demand as well as favorable pricing trends across our portfolio of refrigerants. We view the selling season as a nine-month period, and the second quarter has historically been a strong quarter for us as it typically coincides with warmer weather in the North and Northeast resulting in the start-up of cooling systems. During the second quarter, our business also benefitted from the favorable impact of the U.S. economy reopening. As we move through the balance of our selling season, we’re optimistic about the activity and interest we’re seeing for our products in the marketplace.

“Additionally, from a regulatory perspective, we’re looking forward to the anticipated publication of HFC allocations in September as the allocation portion of the AIM Act goes into effect. When the allocations become public, we’ll have more visibility around how the industry will be positioned to supply the large and growing installed base of HFC systems as virgin production begins it phasedown starting in 2022. The AIM Act establishes a cumulative 40% reduction in the baseline by 2024 and we anticipate that reclamation will be critical to maintaining necessary supply during this HFC phasedown period. Given our reclamation capabilities and robust distribution network, Hudson is uniquely positioned as both a supplier and a reclaimer, to meet potential supply shortfalls as virgin HFC production is phased down to 15% in the year 2036. We believe the upcoming HFC phasedown represents a tremendous long-term growth opportunity and will create a favorable environment for us to capture additional business with our sustainable, reclaimed refrigerant offerings,” Mr. Coleman concluded.


Hudson Technologies Reports First Quarter 2021 Results

PEARL RIVER, NY – MAY 5, 2021 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the first quarter ended March 31, 2021.

For the quarter ended March 31, 2021, Hudson reported revenues of $33.8 million, a decrease of 7% compared to revenues of $36.4 million in the comparable 2020 period. The decrease in revenue was primarily due to decreased volume, as the COVID pandemic shutdowns did not have as great an impact to the first quarter of 2020 as compared to 2021. The demand decline was partially offset by an increase in selling price of certain refrigerants. Gross margin in the first quarter of 2021 was 27%, compared to 23% in the first quarter of 2020, mainly due to the aforementioned increase in selling price of certain refrigerants. Hudson reported operating income of $1.7 million in the first quarter of 2021 compared to operating income of $0.4 million in the prior year period. The Company recorded a net loss of $1.1 million or ($0.02) per basic and diluted share in the first quarter of 2021, compared to a net loss of $2.9 million or ($0.07) per basic and diluted share in the same period of 2020. At March 31, 2021, the Company had approximately $32 million of total availability, consisting of the cash balance plus revolving loan availability.

Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies commented,
“As we kick off the 2021 selling season, we are optimistic that we’ll begin to see a broader reopening of the economy, and specifically a return to facilities such as schools, office buildings and other venues that represent the end markets for many of our customers. With that in mind, we are prepared to meet potential demand as the nine-month cooling season continues, particularly as cooling systems come back online with the gradual return to ‘business as usual’ and we move into the warmer late spring and summer weather.

“Looking at the regulatory landscape, we are encouraged by the progress made with the passing of the AIM Act in December 2020. As a leading source of all refrigerants, Hudson is keenly focused on our role as environmental and sustainability legislation is adopted. Our capabilities as a reclaimer uniquely position us to support the phase down of HFC refrigerants, as we can reclaim and recycle these refrigerants, positioning us as an effective resource in the circular economy of the refrigerant industry. The AIM Act requires the phasedown of HFC production over the next 15 years, with a cumulative 40% reduction in the baseline scheduled to take place in just 2 ½ years. The installed base of HFC systems is large and growing, so reclamation will be a key component to maintaining necessary supply during an orderly phasedown, and this presents a significant long-term opportunity for Hudson to become an HFC supplier, while also supporting the transition away from production of virgin HFCs. We’re excited by the opportunities we’re seeing not only to grow our business, but also to provide our services to benefit the environment,” Mr. Coleman concluded.


Hudson Technologies Reports Fourth Quarter 2020 Results

PEARL RIVER, NY – MARCH 3, 2021 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the fourth quarter and year ended December 31, 2020.

For the quarter ended December 31, 2020, Hudson reported revenues of $22.1 million, a decrease of 14% compared to revenues of $25.8 million in the comparable 2019 period. The decrease in revenue was primarily due to decreased volume, as the COVID-19 pandemic and the associated closures of public venues such as commercial and recreational facilities, schools and universities across the U.S. negatively impacted the Company’s end markets and overall demand for refrigerants for much of the year, partially offset by an increase in selling price of certain refrigerants. Gross margin in the fourth quarter of 2020 was 25%, compared to 19% in the fourth quarter of 2019, mainly due to the aforementioned increase in selling price of certain refrigerants. Hudson reported an operating loss of $1.7 million in the fourth quarter of 2020 compared to an operating loss of $4.8 million in the prior year period. The Company recorded a net loss of $4.7 million or ($0.11) per basic and diluted share in the fourth quarter of 2020, compared to a net loss of $10.8 million or ($0.25) per basic and diluted share in the same period of 2019.

For the year ended December 31, 2020, Hudson reported revenues of $147.6 million, a decrease of 9% compared to $162.1 million in 2019. The decrease in revenue was primarily due to decreased volume, related to the pandemic-driven closures described above. Gross margin for full year 2020 improved to 24% compared to gross margin of 11% for the full year 2019. The Company reported operating income of $5.9 million for 2020 compared to an operating loss of $15.8 million in 2019. The Company’s net loss for 2020 was $5.2 million, or ($0.12) per basic and diluted share, compared to a net loss of $25.9 million, or ($0.61) per basic and diluted share in 2019, which included a $9.2 million non-cash inventory adjustment mainly due to declines in selling prices of certain refrigerants during that time period.

Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies commented, “2020 was a challenging year for our industry, characterized by the public health and economic uncertainties caused by the global COVID-19 pandemic. As we begin 2021, we are optimistic that the widespread closures related to the virus will begin to subside and enable the broader re-opening of our economy. With that in mind, we are planning and preparing for the 2021 selling season so that we are ready to meet potential demand as more cooling systems return to operation and we look forward to fully re-engaging with our customers as they continue to come back online.”


Hudson Technologies Reports Third Quarter 2020 Results

PEARL RIVER, NY – NOVEMBER 5, 2020 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the third quarter and nine months ended September 30, 2020.

For the quarter ended September 30, 2020, Hudson reported revenues of $41.5 million, a decrease of 9% compared to revenues of $45.6 million in the comparable 2019 period. The decrease is primarily due to a decline in volume, as the continued COVID-19 pandemic and the associated closures of public venues such as office buildings, gyms, schools and universities across the U.S. negatively impacted the Company’s end markets and overall demand for refrigerants. Gross margin in the third quarter of 2020 was 22%, compared to 17% in the third quarter of 2019. The Company reported operating income of $2.1 million for the third quarter of 2020 compared to an operating loss of $1.2 million in the third quarter of 2019. The Company recorded net income of $39,000 or $0.00 per basic and diluted share in the third quarter of 2020, compared to net income of $2.7 million or $0.06 per basic and diluted share in the same period of 2019. During the third quarter of 2019, the Company received $8.9 million in proceeds from the working capital settlement arising from the acquisition of Aspen Refrigerants, Inc. (“ARI”), which led to the net profit in that quarter. Hudson recorded non-GAAP Adjusted EBITDA of $4.6 million in the third quarter of 2020 compared to Adjusted EBITDA of $3.9 million in the third quarter of 2019. (Adjusted EBITDA is a non-GAAP financial measure – see the description of Adjusted EBITDA and tabular Reconciliation of Net Income (Loss) to Adjusted EBITDA in the supplemental table included at the end of this release).

For the nine months ended September 30, 2020, Hudson reported revenues of $125.5 million, a decrease of 8% compared to $136.3 million in the first nine months of 2019. The decrease in revenue was primarily due to decreased volume, related to the pandemic-driven closures described above. Gross margin for the first nine months of 2020 improved to 24% compared to gross margin of 9% for the same period in 2019. The Company reported operating income of $7.7 million for the first nine months of 2020 compared to an operating loss of $11.0 million in the first nine months of 2019. The Company’s net loss for the first nine months of 2020 was $0.5 million, or ($0.01) per basic and diluted share, compared to a net loss of $15.2 million, or ($0.36) per basic and diluted share, in the first nine months of 2019, which included a $9.2 million non-cash inventory adjustment offset by the $8.9 settlement proceeds described above. For the first nine months of 2020, Hudson recorded non-GAAP Adjusted EBITDA of $15.7 million compared to Adjusted EBITDA of $9.9 million in the first nine months of 2019. For the trailing twelve months ended September 30, 2020, Hudson recorded non-GAAP Adjusted EBITDA of $14.9 million, a 75% increase from the $8.5 million of Adjusted EBITDA recorded during the trailing twelve months ended September 30, 2019. (Adjusted EBITDA is a non-GAAP financial measure – see the description of Adjusted EBITDA and tabular Reconciliation of Net Income (Loss) to Adjusted EBITDA in the supplemental table included at the end of this release).

Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies commented, “Our third quarter performance was largely consistent with our expectations as we, and the rest of our industry, continued to contend with demand declines associated with the ongoing closure of many public venues across the U.S. Given the selling environment, we’re pleased to have achieved improved gross margin, increased operating income and breakeven profitability in the third quarter. Moreover, we repaid $16.5 million of debt during the third quarter of 2020, and as of September 30, 2020, we have fully paid down our revolver, while increasing our cash balance to $9.2 million. As of September 30, 2020, our overall availability, which includes our cash balance and revolver availability, was $41.7 million, which will provide financial flexibility for the fourth quarter and beyond.

“As we move through the final months of 2020, we remain focused on continuing to navigate the uncertainties of this pandemic. Historically, the fourth quarter is typically our quietest quarter, one in which we plan our operational strategy to anticipate and meet the needs of our customers for the following year’s cooling season. We are optimistic that 2021 will bring more consistent re-openings for businesses and schools and we are planning accordingly so that Hudson is well positioned to help meet potential demand as more cooling systems are turned back on. We remain committed to protecting the health and safety of our employees while also maintaining our product supply for our customers across all channels.”


Hudson Technologies Reports Second Quarter 2020 Net Income of $2.4 Million or $0.06 Per Share

PEARL RIVER, NY – AUGUST 5, 2020 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the second quarter and six months ended June 30, 2020.

For the quarter ended June 30, 2020, Hudson reported revenues of $47.7 million, a decrease of 14.8% compared to revenues of $56.0 million in the comparable 2019 period. The decrease is primarily due to a decline in volume, partially offset by an increase in selling price, of certain refrigerants sold during the second quarter of 2020, compared to the second quarter of 2019. Gross margin in the second quarter of 2020 was 26.6%, compared to negative gross margin in the second quarter of 2019. The Company reported operating income of $5.2 million for the second quarter of 2020 compared to an operating loss of $10.0 million in the second quarter of 2019. During the second quarter of 2019 the Company recorded a lower of cost or net realizable value adjustment to its inventory of $9.2 million, mainly due to declines in selling prices of certain refrigerants at that time. The Company recorded net income of $2.4 million or $0.06 per basic and diluted share in the second quarter of 2020, compared to a net loss of $13.8 million or ($0.32) per basic and diluted share in the same period of 2019.

For the six months ended June 30, 2020, Hudson reported revenues of $84.0 million, a decrease of 7.4% compared to $90.7 million in the first six months of 2019. The decrease in revenue was primarily due to decreased volume, partially offset by increased pricing of certain refrigerants. Gross margin for the first six months of 2020 improved to 25.0% compared to gross margin of 5.1% in the first half of 2019. The Company reported operating income of $5.6 million for the first six months of 2020 compared to an operating loss of $9.7 million in the same period of 2019. The Company’s net loss for the first six months of 2020 was $0.5 million, or ($0.01) per basic and diluted share, compared to a net loss of $17.8 million, or ($0.42) per basic and diluted share, in the first half of 2019, which included the above mentioned $9.2 million non-cash inventory adjustment.

Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies commented, “We were pleased to deliver solid second quarter results, particularly as we continue to navigate the challenging landscape associated with the COVID-19 virus and the associated impact to our economy. During the quarter, the closures to public venues, such as office buildings, recreation centers, schools and universities across the U.S. impacted end markets and demand for refrigerants. While pricing remained consistent in the quarter, volume declines adversely impacted our overall revenues. Nonetheless, we delivered improved gross margin for the quarter, achieved solid operating income and returned to profitability.

“There are still many uncertainties associated with this pandemic and we remain focused on the elements of our business that we can control: protecting the health and safety of our employees and keeping our products in supply to best serve our customers across all channels. We’ve been in this business for more than thirty years, and our ability to adapt to changing economic and industry landscapes while executing our operational strategy is a strength we continue to rely upon. Despite the challenging market environment, Hudson generated over $6 million of operating cash flow during the second quarter of 2020. The Company’s financial position and liquidity remain strong, with total liquidity at June 30, 2020 of approximately $39 million, which includes cash and revolver availability. Finally, as announced in an 8-K this past Monday, we’ve met certain performance targets set forth in our Credit Agreement, and as a result of this achievement, we have terminated the services of our Chief Restructuring Officer.

“As you know, in late June, our Company suffered the unexpected loss of our founder Kevin J. Zugibe, P.E. He was an industry pioneer who brought remarkable passion, expertise and energy to Hudson, and he is greatly missed. In his years building the Company, Kevin recognized the importance of establishing a strong management team to drive and support Hudson’s growth. All of our employees are committed to continuing to grow and execute on Kevin’s legacy, and as one of Kevin’s longstanding partners for over 20 years, I can assure you that we are focused on our Company’s success as we move through the coming months and years,” Mr. Coleman concluded.


Hudson Technologies Reports First Quarter 2020 Revenues of $36.4 Million, Gross Margin of 23% and Liquidity of $27 Million

Pearl River, NY – May 6, 2020 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the first quarter ended March 31, 2020.

For the quarter ended March 31, 2020, Hudson reported revenues of $36.4 million, a 5% increase compared to $34.7 million in the comparable 2019 period, primarily due to an increase in the volume of refrigerants sold. Gross margin was 23% for the first quarter of 2020 compared to 20% for the first quarter of 2019. The Company reported operating income of $0.4 million for the first quarter of 2020 compared to operating income of $0.2 million for the first quarter of 2019. Net loss for the first quarter of 2020 was $2.9 million, or ($0.07) per basic and diluted share, compared to a net loss of $4.0 million or ($0.09) per basic and diluted share in the first quarter of 2019.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “First let me say that the novel coronavirus disease, COVID-19, has had a dramatic impact on every person, business and industry, and Hudson is no exception. However, Hudson operates in a ‘critical infrastructure industry’ and is an essential business as defined by the U.S. government. We have kept our plants operating and have been effectively running our operations, while following all state and federal guidelines to keep our employees safe and healthy. Our priorities throughout this pandemic have been, and will continue to be, to ensure the health and safety of our employees; to keep our products in supply and to maintain the quality and safety of our products; to best serve our customers across all channels as they adapt to the crisis; and, to position ourselves to emerge strong when the crisis ends.

“As we look back on the first quarter, we saw an increase in volume over the same period last year, building on the increased volume we saw in 2019, and we are seeing some strengthening in the pricing of R-22. We are a few weeks away from the prime selling season so it is still early in the 2020 season to know how pricing will develop, and it also remains to be seen as to what effect the weather and the economic impact of COVID-19 will have on the price and demand for refrigerants. Additionally, during the first quarter, we improved our gross margins in 2020 over 2019 and believe we have the opportunity to further drive improved margins in 2020 as we replace higher priced inventory with lower priced product. We believe that customer inventories are low and, with the elimination of R-22 production and importation in 2020, we expect to see a tightening in the supply of virgin R-22. Finally, the Company’s financial position and liquidity remain strong, with total liquidity at March 31, 2020 of approximately $27 million, which includes cash and revolver availability.

“As we proceed through 2020, we are concerned that the economic factors resulting from the various governmental restrictions that have been put in place could have a negative impact on the demand for refrigerants. We continue to focus on implementing various strategies to grow our leadership position in the refrigerant industry, and on leveraging our strong reclamation abilities and our presence at key points in the supply chain.”


Hudson Technologies Reports Fourth Quarter 20119 Results

Pearl River, NY – March 4, 2020 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the fourth quarter and year ended December 31, 2019.

For the quarter ended December 31, 2019 Hudson reported revenues of $25.8 million, slightly higher than revenues of $25.7 million in the comparable 2018 period. Gross margin in the fourth quarter of 2019 was 18.5%, compared to gross margin of 12% in the fourth quarter of 2018. The Company recorded a net loss of $10.8 million or ($0.25) per basic and diluted share in the fourth quarter of 2019, compared to a net loss of $8.1 million or ($0.19) per basic and diluted share in the same period of 2018. Approximately $1.9 million of this variance relates to higher interest expense mainly related to the write off of deferred financing costs from our previous revolving facility, which was replaced in December 2019. In addition, during the fourth quarter of 2019, the Company incurred additional and nonrecurring lender-related fees and expenses related to the closure of a facility.

For the year ended December 31, 2019, Hudson reported revenues of $162.1 million, a decrease of 2.7% compared to $166.5 million for full year 2018. The decrease in revenue was primarily due to further pricing correction in 2019, partially offset by higher refrigerant sales volume and higher revenue from our DLA contract. Gross margin for calendar year 2019 was $17.2 million, or 10.6%, as compared to negative gross margin of $7.4 million for 2018. The Company’s net loss for 2019 was $25.9 million, or $0.61 per basic and diluted share, which includes a $9.2 million non-cash inventory write down partially offset by $8.9 million of settlement proceeds from the working capital settlement arising from the acquisition of Aspen Refrigerants, Inc. (“ARI”), as compared to net loss of $55.7 million or $1.31 per basic and diluted share in 2018. Full year 2018 net loss includes a $35.9 million non-cash inventory write down.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented,
“2019 was another challenging year for Hudson and for the entire industry, as we saw further price erosion in nearly all refrigerants through September. However, it was also a year where we saw growth in our sales volume, reduction in costs and improvement in margins as we progressed through the year. Entering 2020 we have seen some encouraging signs in the industry as to pricing and we are currently seeing pricing for R-22 above $10 per pound. With the elimination of virgin production and importation in 2020, we expect to see tighter supply of R-22, and we believe our ability to reclaim and resell R-22 creates a tremendous opportunity to position Hudson to address the anticipated tightening of supply and become the leading producer of R-22.

“Additionally, during the fourth quarter, we improved our margins in 2019 over 2018 and believe we have the opportunity to further drive improved margins in 2020 as we replace higher priced inventory with lower priced product. We saw some of this improvement in 2019 as we reduced our inventory by 42% through a combination of selling off higher priced inventory and managing more towards a just-in-time inventory model. During 2019, the Company generated $34 million of cash flow from operations, which included $15.2 million of cash interest expense, and paid down $31 million of debt, including $14 million of long term debt in the fourth quarter of 2019. As of December 31, 2019, the Company had over $22 million of availability through its new revolving facility. The new term loan amendment and revolving facility will offer us flexibility in our operations for 2020 and the future.

“We’re optimistic about the positive momentum we’re seeing for the regulation of HFC refrigerants. There is growing bipartisan support for the American Innovation and Manufacturing Act of 2019, or the AIM Act, which, if enacted, would phase down HFC production. Whether the AIM Act is passed, the process first occurs at the state level, or through the actual ratification of the Kigali amendment, we anticipate a phase down of HFCs and we expect to see the establishment of an allocation system as well as a tightening in the supply/demand balance for HFCs that will likely result in increased pricing. We believe the phase out of R-22 and phase down of HFCs continue to represent tremendous growth opportunities for our company.”

Mr. Zugibe concluded, “We have been a leader in the refrigerant and reclamation industry for a long time because we have learned to innovate and evolve during the challenging periods to become a stronger business. We remain focused on meeting the changing needs of our customers and on remaining agile in the face of fluid market dynamics as we work to increase our market share and advance our leadership position in the marketplace.”


Hudson Technologies Reports Third Quarter 2019 Results

Pearl River, NY – November 14, 2019 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the third quarter and nine months ended September 30, 2019.

For the quarter ended September 30, 2019 Hudson reported revenues of $45.6 million, an increase of 13% compared to $40.5 million in the comparable 2018 period. The increase in revenues was due to an increase in refrigerant volumes and growth with the DLA contract, offset by a decline in prices of certain refrigerants sold during the 2019 quarter when compared to 2018. Selling, general and administrative (“SG&A”) expenses for the three-month period ended September 30, 2019 were $8.3 million, compared to $7.4 million in the comparable 2018 period. The increase in SG&A was primarily attributable to professional fees and insurance expense. The Company’s net income for the third quarter of 2019, was $2.7 million, or $0.06 per basic and diluted share. During the third quarter of 2019, the Company received $8.9 million in proceeds from the working capital settlement arising from the acquisition of Aspen Refrigerants, Inc. (“ARI”). Net loss for the third quarter of 2018 was $13.9 million or $(0.33) per basic and diluted share. Included in the $13.9 million third quarter 2018 loss are approximately $9 million in non-cash charges related to a deferred tax reserve and approximately $2 million in non-recurring charges related to the acquisition and integration of ARI.

For the nine months ended September 30, 2019, Hudson reported revenues of $136.3 million compared to $140.8 million in the comparable 2018 period. Refrigerant selling prices declined in 2019 when compared with 2018. The overall decline in revenues was partially offset by an increase in overall refrigerant volumes and revenue from the DLA contract. SG&A expenses for the nine-month period ended September 30, 2019 were $21.2 million, compared to $26.0 million in the comparable 2018 period. The decrease in SG&A was primarily attributable to reduced payroll-related expenses, advertising and other professional fees in the first nine months of 2019. Net loss for the first nine months of 2019, which includes a $9.2 million inventory adjustment offset by the $8.9 million of settlement proceeds, was $15.2 million, or ($0.36) per basic and diluted share. Net loss in the first nine months of 2018, which included a $34.7 million inventory adjustment, was $47.6 million, or $(1.12) per basic and diluted share.

Loan Covenant Defaults

The Company failed to comply with the financial covenants contained in its term loan facility and its revolving credit facility at September 30, 2019 and is currently in default under those agreements. Other than the financial covenants, the Company has fully complied with all of its debt payment and other obligations on a timely basis. Despite the covenant violations, the Company had over $23 million of availability pursuant to the borrowing base formula in its revolving loan facility as of September 30, 2019. During the third quarter of 2019, the Company utilized its cash from operations to pay over $18 million of debt. As such, the Company does not believe that the covenant defaults relate to a liquidity issue, but relate to a leverage issue under the current covenant structure. The Company is currently seeking a waiver and amendment from its lenders to waive the covenant defaults and reset the financial covenants under both the term loan facility and the revolving credit facility. However, the lenders have the right to declare all amounts under these facilities to be immediately due and payable, and there can be no assurance that the Company will be able to obtain any such waivers or amendments on acceptable terms or at all.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “During the third quarter, we saw an increase in volume due to Hudson’s ability be more competitive as we sold through a large portion of our higher priced inventory. Pricing through the third quarter remained relatively consistent with pricing throughout the selling season, but was lower when compared to pricing in the third quarter of 2018. Moreover, during the 2019 sales season, one large allocation holder indicated that it is no longer supporting R-22 sales. Additionally, the remaining large allocation holders recently raised their R-22 price and we are currently experiencing the first price increase this year. We believe those actions, coupled with the ban of R-22 production and importation after 2019, will result in a tightening of R-22 supply for the 2020 selling season.

“We remain confident in the long-term opportunities for our business, particularly as we sell through the higher priced R-22 acquired with the Airgas acquisition, which we expect will result in a margin level more in line with our historical performance. The demand for cooling systems remains strong and our positioning at two key points in the supply chain, along with our ability to provide any refrigerant, anywhere at any time, remains a competitive strength as we close out 2019 and move into 2020.”


Hudson Technologies Reports Second Quarter 2019 Results and Receives $8.9 Million Settlement from Airgas

Pearl River, NT – August 14, 2019 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the second quarter and six months ended June 30, 2019.

For the quarter ended June 30, 2019 Hudson reported revenues of $56.0 million compared to $57.8 million in the comparable 2018 period. Refrigerant average selling prices declined by approximately 19%, partially offset by a 12% increase in volume. Revenue from the Defense Logistics Agency (“DLA”) increased by approximately $2.3 million in the quarter. The Company recorded lower of cost or net realizable value (“NRV”) adjustments to its inventory of $9.2 million and $34.7 million during the second quarter of 2019 and 2018, respectively. The 2019 NRV adjustment was primarily attributed to the remaining R-22 inventory purchased in connection with the acquisition of Aspen Refrigerants, Inc. (“ARI”). Selling, general and administrative (“SG&A”) expenses for the three-month period ended June 30, 2019 were $6.8 million, a decrease of $3.8 million from the $10.6 million reported during the comparable 2018 period. The reduction in SG&A was primarily attributable to professional fees pertaining to integration and services relating to the acquisition of ARI, which declined by approximately $2.5 million from the second quarter of 2018, as well as a reduction in payroll-related expenses, advertising and other professional fees in the second quarter of 2019 compared to the 2018 period. The Company’s net loss for the second quarter of 2019, which includes the above mentioned $9.2 million inventory adjustment, was $13.8 million, or $(0.32) per basic and diluted share. This compares to a net loss for the second quarter of 2018, which includes the above mentioned $34.7 million inventory adjustment, of $30.6 million or $(0.72) per basic and diluted share.

For the six months ended June 30, 2019, Hudson reported revenues of $90.7 million compared to $100.3 million in the comparable 2018 period. Refrigerant average selling prices declined by approximately 19%, partially offset by a 3% increase in refrigerant volume. Revenue from the DLA also increased by approximately $4.1 million. Net loss for the first half of 2019, which includes the above mentioned $9.2 million inventory adjustment, was $17.8 million, or ($0.42) per basic and diluted share. This compares to a net loss in the first half of 2018, which includes the above mentioned $34.7 million inventory adjustment, of $33.7 million, or $(0.79) per basic and diluted share.

In August 2019, following the end of the second quarter, the Company successfully completed the working capital adjustment process arising from the acquisition of ARI, including the settlement of related litigation, which resulted in Airgas agreeing to make a cash payment to Hudson of $8.9 million.

Loan Covenant Defaults

The Company failed to comply with the financial covenants contained in its term loan facility and its revolving credit facility at June 30, 2019 and is currently in default under those agreements. Other than the financial covenants, the Company has fully complied with all of its debt payment and other obligations on a timely basis and had over $21 million of availability pursuant to the borrowing base formula in its revolving loan facility as of June 30, 2019. As such, the Company does not believe that the covenant defaults relate to a liquidity issue but relate to a leverage issue under the current covenant structure. The Company is currently seeking a waiver and amendment from its lenders to waive the covenant defaults and reset the financial covenants under both the term loan facility and the revolving credit facility. However, the lenders have the right to declare all amounts under these facilities to be immediately due and payable, and there can be no assurance that the Company will be able to obtain any such waivers or amendments on acceptable terms or at all.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “This was a disappointing quarter as we continued to encounter lower prices, primarily on R-22, when compared to 2018. Temperatures remained cool for much of the quarter, which reduced urgency for customers and a ‘just in time’ buying pattern continued. On a positive note, even with poor weather conditions, we did see refrigerant sales volumes increase meaningfully during the second quarter, and, as we move through the third fiscal quarter, temperatures have risen to more seasonal levels.

“A benefit of our experience in this industry is that we have faced and managed through price corrections and disappointing sales seasons before and as we sell through the higher priced layers within our FIFO inventory, we expect to return to more historical margin levels. We remain optimistic about the long-term market opportunity and remain focused on driving growth by leveraging our positioning at two key points in the supply chain and our ability to provide any refrigerant, anywhere at any time.”


Hudson Technologies Reports First Quarter 2019 Revenues of $34.7 Million and Gross Margin of 20%

Pearl River, NT – May 1, 2019 – Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the first quarter ended March 31, 2019.

For the quarter ended March 31, 2019 Hudson reported revenues of $34.7 million, an 18% decrease compared to $42.4 million in the comparable 2018 period, primarily due to a reduction in the price of certain refrigerants sold. Gross margin was 20% for the first quarter of 2019 compared to 19% for the first quarter of 2018. The Company reported operating income of $0.2 million for the first quarter of 2019 compared to an operating loss of $0.9 million for the first quarter of 2018. Net loss for the first quarter of 2019 was $4.0 million, or ($0.09) per basic and diluted share, compared to a net loss of $3.1 million or ($0.07) per basic and diluted share in the first quarter of 2018. The net loss in 2018 included a $1.1 million tax benefit, while in 2019 the Company had no such tax benefit.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “As expected, the 2019 selling season has started with a continuation of the ‘just-in-time’ buying pattern that our customers adopted and maintained throughout the 2018 selling season. Our first quarter results were additionally impacted by further incremental price declines for most refrigerants that began in the second quarter of 2018 and, with temperatures remaining cool during the first few months of the year, there was little urgency to stock refrigerant. However, we are entering the warmer spring season and would expect to see volumes increase as we move forward to the heart of the nine-month refrigerant season.

“As we move through 2019, we remain focused on implementing strategies to grow our leadership position in the refrigerant industry by leveraging our presence at two key points in the supply chain. Our acquisition of Aspen Refrigerants has enabled us to expand our portfolio of products and services to attract a broader audience and given the growing demand for refrigeration and cooling systems, we are optimistic about the long term market opportunities.”


Hudson Technologies to Acquire Airgas-Refrigerants, Inc.

PEARL RIVER, NY – AUGUST 9, 2017 – Hudson Technologies, Inc. (NASDAQ: HDSN) (“Hudson”) today announced that it has entered into a definitive agreement to acquire Airgas-Refrigerants, Inc. (“ARI”), a subsidiary of Airgas, Inc., a leading U.S. supplier of industrial gases, in a transaction valued on a gross basis at approximately $220 million, subject to closing and post-closing adjustments.

ARI is a leading refrigerant distributor and EPA certified reclaimer in the U.S. ARI distributes, reclaims and packages refrigerant gases for a variety of end uses.

Potential benefits of the acquisition include:

  • ARI’s HFC distribution business will favorably position Hudson as the industry shifts from Hydrochlorofluorocarbons (HCFCs) to Hydrofluorocarbons (HFCs).
  • Broader customer network will provide Hudson with access to refrigerant for reclamation while also strengthening distribution capabilities.
  • Adding incremental reclamation processing capacity to support the anticipated growth in reclamation volume from the ongoing phase out of HCFC (R-22) production and the future phase down of HFC production.
  • Enabling Hudson to sell its state-of-the-art Global Energy Services offerings to a broader base of customers.
  • Enhancing geographic footprint in the U.S.
  • Combining two highly complementary businesses.

As of March 31, 2017, trailing 12 month pro forma revenue of the combined business is approximately $250 million. The transaction is expected to be accretive to earnings beginning one year following the close of the transaction.

The acquisition will be financed with available cash balances plus borrowings under an enhanced asset based lending facility of $150 million from PNC Bank and a new term loan from funds advised by FS Investments and sub-advised by GSO Capital Partners LP of between $95 million and $110 million. No additional Hudson equity will be issued to finance this transaction.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “This will be a transformative acquisition for our company, enhancing our business by providing a complementary product portfolio, expanding our geographic footprint and customer base and significantly expanding our sales and distribution capabilities. ARI is a prominent refrigerant distributor in the United States and we believe the combination of our operations will provide meaningful scale to our business and further enhance Hudson’s leadership in the refrigerant and reclamation industry.

“The increased scale of the combined company will allow us to better serve our customers during the ongoing phase out of HCFC refrigerants and positions us better to serve an expanded customer base during the future phase down of HFC refrigerants. Additionally, this acquisition gives us access to a significantly larger customer base and a new audience for our Global Energy Services offerings, a growing focus of our business which provide optimization solutions, engineering assessments and energy management tools.”

Mr. Zugibe continued, “With the acquisition of ARI, we look forward to leveraging our strengthened capabilities, expertise and reach to meet the needs of an expanded customer base. We look forward to serving our existing and acquired customers with our expanded portfolio of products and services.”

The acquisition of ARI is subject to customary closing conditions, including the consummation of the contemplated debt financing, and the expiration or termination of the applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act, and is currently expected to close in 2017.

William Blair & Co. is acting as Hudson’s exclusive financial advisor for the transaction and the law firm of Wiggin and Dana LLP is serving as the Company’s legal counsel.


About Hudson Technologies

Hudson Technologies, Inc. is a leading provider of innovative solutions to recurring problems within the refrigeration industry. Hudson’s proprietary RefrigerantSide® Services increase operating efficiency and energy savings, and remove moisture, oils and other contaminants frequently found in the refrigeration circuits of large comfort cooling and process refrigeration systems. Performed at a customer’s site as an integral part of an effective scheduled maintenance program or in response to emergencies, RefrigerantSide® Services offer significant savings to customers due to their ability to be completed rapidly and at higher purity levels, and can be utilized while the customer’s system continues to operate. In addition, the Company sells refrigerants and provides traditional reclamation services to the commercial and industrial air conditioning and refrigeration markets. For further information on Hudson, please visit the Company’s web site at www.hudsontech.com.

Safe Harbor Statement under the Private Securities Litigation Act of 1995

Statements contained herein, which are not historical facts constitute forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changes in the markets for refrigerants (including unfavorable market conditions adversely affecting the demand for, and the price of refrigerants), the Company’s ability to source refrigerants, regulatory and economic factors, seasonality, competition, litigation, the nature of supplier or customer arrangements which become available to the Company in the future, adverse weather conditions, possible technological obsolescence of existing products and services, possible reduction in the carrying value of long-lived assets, estimates of the useful life of its assets, potential environmental liability, customer concentration, the ability to obtain financing and other risks detailed in the Company’s periodic reports filed with the Securities and Exchange Commission. The words “believe”, “expect”, “anticipate”, “may”, “plan”, “should” and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.

Investor Relations Contact:

John Nesbett/Jennifer Belodeau
Institutional Marketing Services (IMS)
(203) 972-9200
jnesbett@institutionalms.com

Company Contact:
Brian F. Coleman, President & COO
Hudson Technologies, Inc.
(845) 735-6000
bcoleman@hudsontech.com