DETREX CORPORATION - (DTRX:PK) Contact: Thomas E. Mark
Phone: (248) 358-5800 FAX: (248) 799-7192

 

April 19, 2012

PRESS RELEASE

Detrex Corporation Reports Increased Profits for the First Quarter of 2012

Southfield, Michigan – April 19, 2012 - Detrex Corporation (DTRX.PK), today announced 2012 first quarter net income from continuing operations increased by 15.8% to $726,254, or $0.42 per fully diluted share, compared to net income from continuing operations of $626,965, or $0.39 per fully diluted share, in the first quarter of 2011. Net income including the gain on the sale of the Harvel Plastics subsidiary of $16,945,725 was $17,671,979, or $10.34 per fully diluted share. The Company also expects to pay a second quarter dividend of $0.25 per share.

First quarter 2012 revenues from continuing operations were $12.3 million which represents a 6.5% increase compared to prior year’s first quarter revenues of $11.5 million. This increase was primarily the result of improved domestic lubricant additives demand at the Company’s remaining subsidiary, The Elco Corporation. The earnings improvement from continuing operations was the result of volume related margin improvements and elimination of interest expense as a result of the Harvel transaction. The Company’s 2012 quarterly provision for environmental expense of $600,000 compared to the 2011 quarterly provision of $450,000 that reflects the Company’s practice of replenishing the environmental reserve by an amount at least equal to expected spending. Net income of $17,671,979 includes an after-tax gain on the sale of Harvel, of $16,945,725.

The Harvel sale resulted in significant improvement to the Company’s liquidity and increased equity. The Harvel sale generated net cash of nearly $39 million that enabled the Company to retire all bank debt, contribute $5 million to its pension plans and pay dividends of $3.8 million. Significant future cash commitments for 2012 include income tax payments of $7.6 million and pension contributions of $1.6 million. Operating cash flow is expected to grow stronger as the year progresses due to seasonal factors.

“The sale of Harvel has significantly improved the Company’s balance sheet and financial stability” said Detrex President and CEO Tom Mark. “Elco is continuing to generate strong operating performance and we continue to investigate strategic opportunities to enhance shareholder value. In addition we expect to pay a second quarter dividend of $0.25 per share.”

About Detrex Corporation
Founded in 1925, Detrex Corporation through its subsidiary The Elco Corporation is a leading manufacturer of high performance specialty chemicals including additives for industrial petroleum products and high purity hydrochloric acid.

Forward Looking Statements
Statements included in this press release that are not historical in nature are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “1995 Act”). The words “believe,” “expect,” “anticipate,” “estimate,” “guidance,” “target” and similar expressions identify forward-looking statements. The Company cautions readers that forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those projected in the forward-looking statements. Certain risks and uncertainties are identified from time to time in the Company’s reports. Some factors that could cause results to differ materially from those projected in the forward-looking statements include: market conditions, environmental remediation costs, pension expense and funding requirements, liquidation value of assets, and marketability of real estate and the market value and future liquidity of Detrex stock. The Company claims the protection of the safe harbor for forward-looking statements contained in the 1995 Act.

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