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Calgon Carbon 1Q Profit Rises 50% On Gains; Sales Up

By Tess Stynes, Dow Jones Newswires    5/4/2010 9:12:00 AM    ReadCount:619

Calgon Carbon Corp.'s (CCC) first-quarter earnings rose 50% as the air- and water-purification company recorded increased sales and acquisition-related gains.

However, excluding the gains, results missed analysts' expectations.

Chairman and Chief Executive John Stanik said the company got off to a good start for 2010, given that the first quarter is typically the weakest. Calgon is encouraged by higher demand for activated carbon, especially in the municipal market as it may signal a recovery is under way in an important segment, he added.

Calgon has found strong demand for activated carbon for potable-water treatment in Asia and for mercury removal at coal-fired power plants--though the global economic slowdown had weighed on traditional markets--such as municipalities cleaning their drinking water. Favorable pricing and better demand for environmental air treatment have also buoyed sales.

It has used the momentum to buy up other purification-system companies.

Calgon reported a profit of $9 million, or 16 cents a share, up from 6 million, or 11 cents a share, a year earlier. The latest period included $2.2 million in aquisition-related gains. Revenue jumped 14% to $102.9 million.

Analysts polled by Thomson Reuters most recently forecast earnings of 16 cents on revenue of $105 million.

Gross margin rose to 36.1% from 32.5% on higher volume and prices on some products.

The company made acquisitions in Europe and Japan during the quarter, expanding their presence in activated carbon there, expanding their capabilities in ultraviolet light technology and entering the market for ballast water disinfection.

Shares closed Wednesday at $16.63 and were inactive premarket. The stock is up 20% this year.