USEY up .13 to 1.32:
(COMTEX) B: U.S. Energy Systems Announces Third Quarter 2003 Earnings
B: U.S. Energy Systems Announces Third Quarter 2003 Earnings
WHITE PLAINS, NY, Nov 14, 2003 /PRNewswire-FirstCall via Comtex/ -- U.S. Energy
Systems, Inc. (Nasdaq: USEY), a provider of customer-focused energy solutions,
announced fully diluted earnings per share of common stock of $0.04 in the three
month period ended September 30, 2003 and $0.20 per share in the nine month
period ended September 30, 2003.
Financial Results
Consolidated revenues totaled $8,706,000 in the three month period ended
September 30, 2003, a decrease of 5.3% when compared with the prior year period
in 2002. Excluding the effects of an accounting change to Scandinavian Energy
Finance, Ltd. ("SEFL") and the sale of US Energy Geothermal LLC ("Geothermal
LLC") in the second quarter of 2003, revenues increased by 8.5% compared with
the prior year period, mainly as a result of increasing energy sales.
Consolidated revenues decreased by 3.0% in the nine months ended September 30,
2003 from the prior year period. However, when excluding the effects of SEFL,
Geothermal LLC and USE Enviro Systems (which was sold in the second quarter
2002), revenues increased by $4,065,000 or 16.3% in the third quarter 2003 when
compared with the same period in 2002, mainly reflecting higher energy sales.
Consolidated net income was $717,000 in the three month period ended September
30, 2003, as compared with net income of $714,000 in the prior year period. The
results reflect increased energy sales, offset by higher fuel costs in Canada,
the sale of Geothermal LLC and a provision against the income contribution from
the Company's investment in SEFL. Earnings per fully diluted share were $0.04 in
the third quarter of 2003, compared with earnings per fully diluted share of
$0.04 in the prior year period.
Due to the rationalization of substantially all of our non-core assets and the
deconsolidation of SEFL, the consolidated financial results of the Company in
the third quarter of 2003 reflect our remaining core operations. In the third
quarter of 2003, earnings generated from US Energy Biogas Corp. and USE Canada
Energy Corp were $833,000, as compared with $627,000 in the prior year period.
Scandinavian Energy Finance, Ltd.
The Company, along with its joint venture partner, EIC Electricity SA ("EIC")
and a third party have reached agreements under which EIC will make additional
investments in SEFL, and the Company's interest in SEFL will be reduced to 32%.
As a result, SEFL was deconsolidated from the Company's balance sheet and is now
accounted for using the equity method. The Company has designated SEFL as
non-core, as part of the Company's previously announced strategy to focus its
business activities on the North American market.
Strategic Alternatives
The Company recently announced at its annual meeting of stockholders on
September 9, 2003 that its proposal, as filed in its August 7, 2003 proxy
statement (the "Plan"), was approved by the US Energy stockholders to authorize
US Energy Systems, Inc. to enter into one or more transactions to sell the
stock, assets or a combination of the two of its principal subsidiaries, US
Energy Biogas Corporation and USE Canada Holdings Corp., and its partnership
interest in ZFC Royalty Partners, L.P., on the terms and conditions described in
the proxy statement:
Goran Mornhed, President and Chief Executive Officer of U.S. Energy, stated, "We
are pleased with our stockholders' support of the Plan. We believe that our
implementation of improvements in the operations of US Energy Biogas and USE
Canada during the past two years have provided a unique opportunity to
recapitalize our balance sheet, reduce debt and increase our financial
resources. Most importantly, the transaction, if consummated, would provide
financial flexibility and an opportunity to enhance shareholder value going
forward."
~Tables To Follow~
About U.S. Energy Systems, Inc.
U.S. Energy Systems, Inc., based in White Plains, NY, is a customer- focused
provider of energy outsourcing services for large retail customers, including
industrial, commercial and institutional end users. USEY owns, operates and/or
financed 34 energy projects in North America and Western Europe, totaling the
equivalent of 262 megawatts and using combined heat and power (CHP) technology
and renewable fuels. U.S. Energy Systems has formed a number of strategic
business partnerships with leading companies, including Cinergy Solutions, a
subsidiary of Cinergy Corp. (NYSE: CIN), which is a strategic investor and joint
venture partner, and Arthur J. Gallagher & Co. (NYSE: AJG), an international
insurance brokerage company (www.usenergysystems.com).
For more information contact:
Investor Relations Department
U.S. Energy Systems, Inc.
One North Lexington Ave
White Plains, New York 10601
914-993-6443
Info@usenergysystems.com
Certain matters discussed in this press release are forward-looking statements,
and certain important factors may affect the Company's actual results and could
cause actual results to differ materially from any forward- looking statements
made in this release, or which are otherwise made by or on behalf of the
Company. Such factors include, but are not limited to, changes in market
conditions, the inability to commence planned projects in a timely manner, the
impact of competition, the ability to complete acquisitions, risks associated
with acquisitions, as well as other risks detailed from time to time in the
Company's Securities and Exchange Commission filings, including U.S. Energy's
Annual Report on Form 10-KSB for the year ended December 31, 2002 and the
Company's Proxy Statement for its Annual Meeting of Stockholders filed on August
7, 2003. We do not undertake to update any of the information set forth in this
press release.
U.S. ENERGY SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in Thousands Except Share Data)
THREE MONTHS ENDED NINE MONTHS ENDED
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2003 2002 2003 2002
Revenues $8,706 $9,195 $28,939 $29,847
Costs and expenses:
Operating expenses 4,309 3,984 15,479 15,653
Operating, general
and administrative -
non-recurring -- -- -- 10,234
General and administrative
expenses 1,764 1,801 4,793 5,514
Depreciation and
amortization 1,078 1,294 3,354 3,918
(Gain) from joint
ventures (227) (19) (556) (94)
Total costs and
expenses 6,924 7,060 23,070 35,225
Income (loss) from
operations 1,782 2,135 5,869 (5,378)
Interest income 454 398 1,084 1,248
Dividend income -- 20 20 61
Interest expense (2,312) (1,757) (6,689) (6,130)
Minority interest (291) (387) (771) (775)
Income (loss) before
taxes (367) 409 (487) (10,974)
Income tax 1,084 305 2,513 5,560
Income (loss) before
cumulative effect of
accounting change and
disposal of a segment 717 714 2,026 (5,414)
Gain on disposal of a
segment (net of income
tax of $113,000) -- -- -- 170
Gain on sale of subsidiary
(net of income tax
of $887,000) -- -- 1,419 --
Cumulative effect of
accounting change on
years prior to 2002
(net of income tax of
$546,000) -- -- -- (754)
NET INCOME (LOSS) 717 714 3,445 (5,998)
DIVIDENDS ON PREFERRED
STOCK (209) (206) (627) (622)
INCOME (LOSS)
APPLICABLE TO
COMMON STOCK $508 $508 $2,818 $(6,620)
INCOME (LOSS) PER SHARE
OF COMMON STOCK:
Income (loss) per share
of common stock - basic $.04 $.04 $.24 ($0.49)
Income (loss) per share
of common stock -
diluted $.04 $.04 $.20 ($0.49)
Weighted average number
of common shares
outstanding - basic 11,950 12,218 11,950 12,218
Weighted average number
of common shares
outstanding - diluted 17,115 17,381 17,115 17,381
OTHER COMPREHENSIVE
INCOME, NET OF TAX:
Net income (loss) $717 $714 $3,445 $ (5,998)
Gain (loss) on foreign
currency translation (1,798) 8 (413) --
Total comprehensive
income $(1,081) $722 $3,032 $ (5,998)
The following table presents a reconciliation of the non-GAAP financial
information included in our press release with certain financial information
included in our quarterly report on form 10Q for the period ended September 30,
2003.
U.S. Energy Systems, Inc. And Subsidiaries
Consolidated Statements Of Operations
(in Thousands)
Three Months Ended September 30, 2003
Core Operations Corporate Consolidated
Unaudited (Unaudited) (Unaudited)
Revenues $8,514 $192 $8,706
Costs and Expenses:
Operating Expenses 4,309 -- 4,309
General and administrative
expenses 1,006 758 1,764
Depreciation and Amortization 1,063 15 1,078
(Gain) from Joint Ventures -- (227) (227)
Total Costs and Expenses 6,378 546 6,924
Income (Loss) From Operations 2,136 (354) 1,782
Interest Income 610 (156) 454
Interest Expense (2,476) 164 (2,312)
Minority Interest (292) 1 (291)
Income (loss) before Taxes (22) (345) (367)
Income Tax Benefit 855 229 1,084
NET Income (loss) $833 $(116) $717
Three Months Ended September 30, 2002
Core Operations Corporate Consolidated
(Unaudited) (Unaudited) (Unaudited)
Revenues 7,876 1,319 9,195
Costs and Expenses:
Operating Expenses 3,569 415 3,984
General and administrative
expenses 1,146 655 1,801
Depreciation and Amortization 1,145 149 1,294
(Gain) from Joint Ventures -- (19) (19)
Total Costs and Expenses 5,860 1,200 7,060
Income From Operations 2,016 119 2,135
Interest Income 398 -- 398
Interest Expense (1,753) (4) (1,757)
Dividend Income -- 20 20
Minority Interest (182) (205) (387)
Income (loss) before Taxes 479 (70) 409
Income Tax Benefit 148 157 305
NET Income $627 $87 $714
SOURCE U.S. Energy Systems, Inc.
CONTACT: Investor Relations Department, U.S. Energy Systems, Inc.,
+1-914-993-6443, or Info@usenergysystems.com
URL: prnewswire.com
usenergysystems.com
Copyright (C) 2003 PR Newswire. All rights reserved.
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KEYWORD: New York
INDUSTRY KEYWORD: ENV
UTI
SUBJECT CODE: ERN
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