CECO Environmental Announces Fourth Quarter and Full Year 2010 Financial Results

CECO Environmental CECE, a leading provider of industrial ventilation and pollution control systems, today announced fourth quarter and full year financial results for the period ended December 31, 2010.

Financial highlights for the fourth quarter of 2010 compared to the fourth quarter of 2009 include:

Net sales from continuing operations were $36.9 million in 2010 as compared to $36.6 million in 2009;

Gross profit from continuing operations was $8.5 million in 2010 as compared to $7.8 million in 2009;

Gross margin increased by 1.6 percentage points to 23.0% in 2010 from 21.4% in 2009;

Selling and administrative expenses in 2010 decreased by $0.4 million to $6.7 million as compared to $7.1 million in 2009;

Operating income from continuing operations was $1.4 million in 2010 as compared to an operating loss of $16.5 million in 2009. The non-GAAP adjusted operating income in 2009, excluding the goodwill impairment charge of $17.1 million, was $0.6 million;

Operating margin increased to 3.9% in 2010 compared to less than 1.0% non-GAAP operating margin in 2009 (excluding goodwill impairment charges);

Net income was $0.7 million in 2010 as compared to a net loss of $14.1 million in 2009. Excluding the goodwill adjustment, the non-GAAP adjusted net income in 2009 was $0.2 million;

Net income per diluted share was $0.05 in 2010 as compared to a net loss per diluted share of $0.97 in 2009. Excluding the goodwill impairment adjustment, non-GAAP adjusted net income per share in 2009 would have been $0.02 per share; and

Bank debt at December 31, 2010 was zero and cash and cash equivalents was $5.8 million.

Our backlog as of December 31, 2010 was $54.3 million compared to $66.5 million as of December 31, 2009. This decline is due in large part as a result of the strategic initiative implemented in 2010 to focus on higher margin backlog with shorter cycles which will generate higher gross margins than previous years.