Hudson Technologies Reports Third Quarter 2014 Results

Hudson Technologies, Inc. (NASDAQ: HDSN) announced results for the quarter ended September 30, 2014.

Revenues for the three months ended September 30, 2014 were $15.3 million, an increase of 1% compared to $15.2 million in the third quarter of 2013. The revenue increase in the quarter is primarily related to an increase in sales volumes of certain refrigerants offset by a decrease in the selling price of certain refrigerants. Net loss for the quarter was $108,000, or $0.00 per basic and diluted share, compared to a net loss of $9.1 million, or $0.36 per basic and diluted share, in the third quarter of 2013. During the third quarter of 2013, Hudson recorded a lower-of-cost-or-market inventory adjustment (“LCM inventory adjustment”) of $14.7 million. The LCM inventory adjustment significantly increased the Company’s cost of sales in the third quarter of 2013.

For the first nine months of 2014, Hudson recorded revenues of $47.8 million compared to $53.8 million in the comparable 2013 period. The decrease in revenues was primarily due to a decrease in R-22 pricing, partially offset by increased volume in the first nine months of 2014. Net income for the first nine months of 2014 was $360,000 or $0.01 per basic and diluted share, compared to a net loss of $4.3 million or $0.17 per basic and diluted share in the first nine months of 2013. Net loss for the first nine months of 2013 included the $14.7 million LCM inventory adjustment detailed above in the third quarter discussion.

Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson Technologies commented, “We have finally put behind us the remnants of last year’s inventory adjustment that resulted from the challenges associated with the EPA’s final ruling in April of 2013. Throughout the past eighteen months we continued to focus on developing new customer relationships while continuing to meet the needs of our existing customers, which contributed to our ability to drive gains in volume and service revenues. We view the reclamation of R-22, as well as of the next generation refrigerants, as an important market opportunity and believe we are well positioned to drive both organic and inorganic growth.”

Mr. Zugibe continued, “Moreover, we are very pleased with the EPA’s final rule signed on October 16, 2014, which established R-22 allowances for 2015 through 2019, and which put forward a significantly more aggressive phase-out schedule than originally proposed. The final rule provides 2015 allowances of 22 million pounds, a nearly 60% reduction from 2014 levels, and provides annual reductions, with final production to end by 2019. We have consistently stated that a more aggressive approach is the best method to achieve the orderly phase out of R-22 and to establish reclamation as the primary, and as of 2020 the sole source of R-22 refrigerant. As we approach 2020, when there will be no virgin R-22 production, the anticipated R-22 aftermarket supply gap will need to be filled by the reclamation industry. As one of the leading reclaimers in the marketplace, this is a very exciting development for Hudson, and one that we believe represents a significant long term growth opportunity for our Company.”

CONFERENCE CALL INFORMATION

The Company will host a conference call to discuss the third quarter results today, October 29, 2014 at 5:00 P.M. Eastern Time.

To access the live webcast, log onto the Hudson Technologies website at www.hudsontech.com, and click on “Investor Relations”. To participate in the call by phone, dial (877) 407-9205 approximately five minutes prior to the scheduled start time. International callers please dial (201) 689-8054.

A replay of the teleconference will be available until November 29, 2014 and may be accessed by dialing (877) 660-6853. International callers may dial (201) 612-7415. Callers should use conference ID: 13593439.

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 Reform Act of 1995

Statements contained herein which are not historical facts constitute forward-looking statements. Such 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 laws and regulations affecting the industry, changes in the demand and price 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 that 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, any delays or interruptions in bringing products and services to market, the timely availability of any requisite permits and authorizations from governmental entities and third parties as well as factors relating to doing business outside the United States, including changes in the laws, regulations, policies, and political, financial and economic conditions, including inflation, interest and currency exchange rates, of countries in which the Company may seek to conduct business, the Company’s ability to successfully integrate any assets it acquires from third parties into its operations, and other risks detailed in the Company's 10-K for the year ended December 31, 2013 and other subsequent filings 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.