Clean Diesel Technologies, Inc. surged 21.35% higher during this morning’s trading session and has traded as high as $3.65 on the back of Q3 preliminary results. CDTI is a cleantech emissions reduction company that has also recently entered into an equity purchase agreement with the investing firm Lincoln Park Capital Fund.
CDTI refers to the Catalytic Solutions, Inc. acquisition as the “Merger” and accounts for the reverse acquisition. Accordingly, Clean Diesel’s (the legal acquirer’s) consolidated financial statements are now those of CSI (the accounting acquirer), with the assets and liabilities and revenues and expenses of legacy Clean Diesel being included in CSI’s financial statements effective from October 15, 2010, the closing date of the Merger. As such, the amounts discussed below for periods prior to the Merger are those of CSI and its consolidated subsidiaries, with amounts of legacy Clean Diesel operations included from the date of the Merger.
Preliminary total revenues for the third quarter of 2011 are expected to be in excess of $14.7 million, or up over 34%, as compared to $10.9 million in the third quarter of 2010 and up over 25% as compared to $11.5 million in the second quarter of 2011. Revenue for the quarter for Clean Diesel’s Heavy Duty Diesel Systems division (“HDD”) is expected to grow in excess of 50% as compared to the same period a year ago, and is expected to be higher than the second quarter of 2011. HDD revenues have benefited from continued strength in sales to the material handling and mining sectors and strong growth in North American retrofit sales and sales in the London Low Emission Zone (“LEZ”). HDD revenue includes approximately $0.3 million of sales from the legacy Clean Diesel business as a result of the Merger. The Catalyst division external sales are expected to be slightly lower than a year ago, but are expected to be higher than the second quarter of 2011 as a result of the recovery of Clean Diesel’s Japan-based customer’s production volumes in August and September, following the earthquake and ensuing tsunami that occurred in March 2011. Including interdivisional sales of catalyst products, which were eliminated in consolidation, sales for this division are expected to grow in excess of 40% in the third quarter of 2011 when compared to the same quarter in 2010.
Clean Diesel’s preliminary results remain subject to finalization by its management and review by its outside independent accountants. While a wide range of results remains possible, Clean Diesel continues to expect its revenues to grow for 2011. Total revenue for 2011 is likely to be heavily weighted to late in the year as a result of the currently expected timing of anticipated sales in the London LEZ. Clean Diesel currently expects to release full results for its third quarter ended September 30, 2011, on or about November 10, 2011.
Additional articles published by Beacon Equity Research can be found on their website at www.BeaconEquity.com
Let us hear your thoughts below: