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LiqTech International, Inc. Reports 2012 Third Quarter Financial and Operational Results

Nov 14 2012 12:00AM

Marketwire

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BALLERUP, DENMARK -- (Marketwire) -- 11/14/12 -- LiqTech International, Inc. (OTCQX: LIQT) ("LiqTech") announced today its financial and operational results for the third quarter 2012.

Lasse Andreassen, CEO of LiqTech International, stated, "For the third quarter 2012, we reported revenue of $3,115,471 and a net loss of $427,872. The loss and low revenue is due to continuing slow sales of DPF, which is down $3,915,852 compared to the same quarter 2011.

"The slowdown in DPF sales is mainly a result of a low degree of enforcement of CARB (California Air Resources Board) mandate in California, where a projected installation of 12,000 filters in 2012 has only resulted in 3,030 for the first half of 2012, with almost no improvement in the third quarter.

"LiqTech and its customers continue to believe that CARB mandate will be enforced in California in the near future and we have been producing filters to meet the demand.

"In our 12-year history we have seen delays in mandates, but these mandates have always been enforced as planned. We are in a strong position to take advantage of the market situation and are now exploring a strategic initiative in our DPF business segment which will significantly strengthen our market situation.

"Our SIC Membrane business continues to grow and sales are up 70% for the 9-month period compared to same period last year.

"As we recently announced, after a one-year trial period, we have consummated a major partnership for sales of our membranes with national oil companies in Colombia and Venezuela. We are also seeing strong interest from other major companies in the oil and water industry and are confident that we will see further growth. We continue to discuss strategic partnerships with major companies and will update shareholders as relationships develop.

"Our recent breakthrough, the grant received from The Maritime and Port of Authority of Singapore (MPA), in Ballast Water Treatment Systems in Singapore is also making us confident that we are well positioned in the highly lucrative BWTS business and we expect to see development in by 2015," concluded Mr. Andreassen.

Financial results for the three and nine months ended September 30, 2012:

•Net sales for the three month period ended September 30, 2012 were $3,115,471 compared to $6,829,535 for the same period in 2011, representing a decrease of $3,714,064, or 54.4%. •Net sales for the nine month period ended September 30, 2012 were $13,410,527 compared to $13,552,746 for the same period in 2011, representing a decrease of $142,219, or 1.0%. •Gross profit for the three month period ended September 30, 2012 was $579,008 compared to $1,460,369 for the same period in 2011 representing a decrease of $881,361, or 60.4%. •Gross profit for the nine month period ended September 30, 2012 was $3,084,859 compared to $3,315,252 for the same period in 2011 representing a decrease of $230,393, or 6.9%. •The net loss for the three month period ended September 30, 2012 was $427,872 compared to net income of $484,206 for the same period in 2011, representing a decrease of $912,078. •The net loss for the nine month period ended September 30, 2012 was $657,779 compared to a net income of $378,243 for the same period in 2011, representing a decrease of $1,036,022.

Highlights for the quarter ended September 30, 2012:

•Quarter-over-quarter gross profit increased to $579,008 from $416,167, representing an increase of 39 percent. •Quarter-over-quarter operating expenses decreased to $1,246,323 from $1,302,704, representing a decrease of 4.3 percent. •Quarter-over-quarter net loss decreased to $427,872 from $552,509, representing a decrease of 22.5 percent. •LiqTech entered into a cooperation agreement with Provital Solution A/S -- a manufacturer and developer of advanced water filtration solutions for pool and spa water in the Scandinavia and Australian market.

ABOUT LIQTECH INTERNATIONAL, INC.
LiqTech International, Inc., a Nevada corporation, is a clean technology company that for more than a decade has developed and provided state-of-the-art technologies for gas and liquid purification using ceramic silicon carbide filters, particularly, highly specialized filters for the control of soot exhaust particles from diesel engines and for liquid filtration. It also manufactures kiln furniture. Using nanotechnology, LiqTech develops products using proprietary silicon carbide technology. LiqTech's products are based on unique silicon carbide membranes which facilitate new applications and improve existing technologies. For more information, please visit www.liqtech.com.

Forward-Looking Statements
This press release contains "forward-looking statements." Although the forward-looking statements in this release reflect the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in the our reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, results of operation and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. We assume no obligation to update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this release.


-Financial charts follow- LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of As of September 30, December 31, 2012 2011 ------------- -------------Current Assets: (UNAUDITED) Cash $ 3,710,067 $ 1,033,057 Accounts receivable, net 4,397,965 5,299,569 Other receivables 1,005,200 1,528,362 Inventories 4,067,699 2,980,583 Prepaid expenses 220,306 301,375 Current deferred tax asset 102,677 17,786 ------------- ------------- Total Current Assets 13,503,914 11,160,732 ------------- -------------Property and Equipment, net of accumulated depreciation 6,563,784 6,647,217 ------------- -------------Other Assets: Other intangible assets 29,984 34,167 Other investments 148,571 6,483 Deposits 200,405 146,184 ------------- ------------- Total Other Assets 378,960 186,834 ------------- ------------- Total Assets $ 20,446,658 $ 17,994,783 ============= ============= LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of As of September 30, December 31, 2012 2011 ------------- -------------Current Liabilities: (UNAUDITED) Lines of credit $ - $ 1,259,936 Notes payable - current portion - 259,396 Notes payable - related party, net of discount - 3,328,183 Current portion of capital lease obligation 197,061 191,444 Accounts payable - trade 1,407,388 3,026,960 Accrued expenses 833,920 1,212,746 Accrued income taxes payable 157,227 3,710 Other accrued liabilities 6,989 154 ------------- ------------- Total Current Liabilities 2,602,585 9,282,529 ------------- -------------Notes payable and long-term debt, less current portion - 350,000Long-term capital lease obligations, less current portion 798,306 950,351Deferred tax liability 428,555 668,484 ------------- ------------- Total Long-Term Liabilities 1,226,861 1,968,835 ------------- ------------- Total Liabilities 3,829,446 11,251,364 ------------- -------------Stockholders' Equity:Common stock; par value $0.001, 100,000,000 shares authorized, 24,111,500 and 21,600,000 shares issued and outstanding at September 30, 2012, and December 31, 2011, respectively 24,112 21,600 Additional paid-in capital 12,680,712 5,603,517 Retained earnings 4,626,803 5,284,583 Deferred compensation (170,477) (268,282) Other comprehensive income, net (570,464) (596,011) Note receivable from a shareholder, net of discount - (3,328,183) Non-controlled interest in subsidiaries 26,526 26,195 ------------- ------------- Total Stockholders' Equity 16,617,212 6,743,419 ------------- ------------- Total Liabilities and Stockholders' Equity $ 20,446,658 $ 17,994,783 ============= ============= LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES (UNAUDITED) CONSOLIDATED STATEMENTS OF OPERATIONS For the Three Months For the Nine Months Ended Ended September 30 September 30 ------------------------ ------------------------ 2012 2011 2012 2011 ----------- ----------- ----------- -----------Net Sales $ 3,115,471 $ 6,829,535 $13,410,527 $13,552,746Cost of Goods Sold 2,536,463 5,369,166 10,325,668 10,237,494 ----------- ----------- ----------- -----------Gross Profit 579,008 1,460,369 3,084,859 3,315,252 ----------- ----------- ----------- -----------Operating Expenses: Selling expenses 557,235 402,648 1,816,612 1,037,853 General and administrative expenses 597,886 263,243 1,871,017 1,139,078 Research and development 91,202 126,680 470,502 374,505 ----------- ----------- ----------- ----------- Total Operating Expenses 1,246,323 792,571 4,158,131 2,551,436 ----------- ----------- ----------- -----------Income from Operations (667,315) 667,798 (1,073,272) 763,816 ----------- ----------- ----------- -----------Other Income (Expense) Interest and other income 12,455 31,417 111,294 50,189 Interest (expense) (7,376) (59,923) (133,264) (139,166) Gain (loss) on currency transactions 12,478 8,658 76,077 (25,832) ----------- ----------- ----------- ----------- Total Other Income (expense) 17,557 (19,848) 54,107 (114,809) ----------- ----------- ----------- -----------Income Before Income Taxes (649,758) 647,950 (1,019,165) 649,007Income Tax Expense (221,886) 91,347 (361,386) 188,557 ----------- ----------- ----------- -----------Net Income (Loss) (427,872) 556,603 (657,779) 460,450Less Net Income (Loss) Attributable To Non- Controlled Interests in Subsidiaries - 72,397 - 82,207 ----------- ----------- ----------- -----------Net Income (Loss) Attributable To LiqTech $ (427,872) $ 484,206 $ (657,779) $ 378,243 ----------- ----------- ----------- -----------Basic Earnings Per Share $ (0.02) $ 0.03 $ (0.03) $ 0.03 ----------- ----------- ----------- -----------Weighted Average Common Shares Outstanding 24,111,500 14,251,721 23,488,208 10,974,237 ----------- ----------- ----------- -----------Diluted Earnings Per Share $ (0.02) $ 0.03 $ (0.02) $ 0.03 ----------- ----------- ----------- -----------Weighted Average Common Shares Outstanding Assuming Dilution 25,094,201 15,761,847 26,394,383 11,477,612 ----------- ----------- ----------- ----------- LIQTECH INTERNATIONAL, INC. AND SUBSIDIARIES (UNAUDITED) CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME For the Three Months For the Nine Months Ended Ended September 30 September 30 ----------------------- ----------------------- 2012 2011 2012 2011 ---------- ---------- ---------- ----------Net Income (Loss) $ (427,872) $ 556,603 $ (657,779) $ 460,450Currency Translation, Net of Taxes 185,670 (456,337) 25,547 (65,918) ---------- ---------- ---------- ----------Other Comprehensive Income (Loss) $ (242,202) $ 100,266 $ (632,232) $ 394,532 ---------- ---------- ---------- ----------Comprehensive Income (Loss) Attributable To Non-controlling Interest in Subsidiaries (575) (7,499) (331) 11,521 ---------- ---------- ---------- ----------Comprehensive Income Attributable To LiqTech International, Inc. $ (242,777) $ 92,767 $ (632,563) $ 406,053 ---------- ---------- ---------- ----------





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