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

 

July 22, 2010

PRESS RELEASE

Detrex Corporation Reports Profit for the Second Quarter of 2010

Southfield, Michigan – July 22, 2010 - Detrex Corporation (DTRX.PK), a diversified manufacturer of PVC and CPVC pipe, duct and shapes and specialty chemicals including additives for industrial petroleum products and high purity hydrochloric acid, today announced second quarter net income of $769,029, or $0.49 per fully diluted share, compared to a net loss of $299,985, or $0.19 per fully diluted share, in the second quarter of last year. Year-to-date net income was $1,114,238 or $0.70 per fully diluted share, compared to a net loss of $621,270, or $0.39 per fully diluted share, in the same period of 2009.

Second quarter net sales increased 28.4% to $24.2 million from $18.8 million in the comparable period last year. On a year-to-date basis, sales were $45.4 million, an increase of $8.6 million, or 23.4% compared to the prior year. The second quarter and year-to-date increase in sales was the result of gains in both of the Company’s subsidiaries, The Elco Corporation and Harvel Plastics, Inc. The year-to-date increase in sales was comprised of 49.9% growth at Elco and 12.6% growth at Harvel. Both companies were able to capitalize on improved conditions in their domestic and export markets. In addition, Elco secured significant additional business with incremental sales to existing customers and sales of recently introduced products. Harvel secured additional volume across almost all product lines, except those primarily related to the housing markets. The earnings improvement is primarily the result of the significant increase in volume; however, also contributing were stronger gross margins and continued control of expenses.

Working capital continued to increase in the second quarter as the result of the volume growth. As a result, bank debt increased by approximately $1.9 million in the second quarter. Liquidity will continue to be closely managed in order to support the businesses and continue the funding of legacy liabilities. The Company negotiated a $2 million increase in its revolving credit facility at the beginning of the third quarter.

Commenting on the Company’s results for the first half of 2010, President and CEO Tom Mark said, “The significant turnaround in performance in the first six months of this year is gratifying as it reflects the dedication and focus of our employees on serving our customers. While we are still uncertain about the speed and magnitude of the economic recovery, we are seeing signs of improvement in many of our markets. We will continue to strive for solid performance and results.”

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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