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Mar 31, 2022
Hudson Q1 2022 Earnings Report
Hudson Technologies reported record first-quarter results driven by increased volumes and selling prices for refrigerants.
Key Takeaways
Hudson Technologies reported a strong start to 2022, with record first-quarter revenues of $84.3 million, a 149% increase compared to the previous year. The company's gross margin significantly improved to 54%, and operating income reached $38.3 million, compared to $1.7 million in the same period last year. With the current pricing trends, the company expects revenues in excess of $270 million in 2022.
Record first-quarter revenues of $84.3 million, a 149% increase year-over-year.
Gross margin increased to 54%, driven by higher selling prices of refrigerants.
Operating income reached $38.3 million, a substantial increase from $1.7 million in the prior year period.
Net income was $29.6 million, or $0.66 per basic share and $0.63 per diluted share, compared to a net loss of $1.1 million in the same period of 2021.
Hudson
Hudson
Forward Guidance
Hudson Technologies anticipates continued strong performance, potentially reaching longer-term targets faster than expected due to the AIM Act. While first-quarter gross margins were particularly strong, the company anticipates margin performance moderating to levels similar to last year but revenue to exceed $270 million.
Positive Outlook
- Expects to reach longer-term targets faster than originally expected.
- Anticipates revenues in excess of $270 million in 2022.
- Company is uniquely positioned to fill the anticipated HFC supply gap as virgin production is phased out.
- The company expects to experience a significant inflection point for its business model and sustainable offerings starting in 2024.
- Company is poised to continue to lead the industry’s orderly transition to greener, more environmentally-friendly refrigerants.
Challenges Ahead
- Margin performance for the full year will moderate to levels similar to that of last year.
- Industry must comply with the AIM Act, which mandates a 10% stepdown in production and consumption allowances for virgin HFCs in both 2022 and 2023.
- Net income during the first quarter of 2022 included $4.6 million of one-time interest expense associated with the refinancing of the Company’s term loan.
- Changes in the laws and regulations affecting the industry could adversely affect the company.
- Changes in the demand and price for refrigerants could adversely affect the company.