Fuel Tech Inc. (Nasdaq: FTEK), which makes air pollution control equipment, said that even though sales increased 11%, profits for the fourth quarter dropped by 44% because expenses outpaced revenue growth.
Net income fell to $1.5 million (6 cents per share) from $2.6 million (11 cents per share) for the prior year quarter. FTEK spent $900,000 for tax expenses, compared to a $200,000 benefit a year ago.
Revenues from its emissions control segment were roughly flat for the quarter, but its fuel treatment chemical technology business – which sells products to coal-fired utilities – saw revenue climb 26%.
Costs rose 15% for increased staff, expenses associated with business growth and stock compensation costs.
Fuel Tech forecast 2007 sales growth of 20-27%. It estimates sales will be in the range of $90- $95 million this year.
In 2006, the company posted sales of $75.1 million versus $52.9 million. Full-year earnings in 2006 totaled $6.8 million, or 28 cents per share, down from $7.6 million, or 33 cents per share, in 2005.
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