Energy Recovery Earnings: Everything You Must Know Now

Energy Recovery, Inc. (NASDAQ:ERII) had a loss and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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Energy Recovery, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share were the same at $-0.09 in the quarter as EPS of $-0.09 in the year-earlier quarter.

Revenue: Rose 34.45% to $6.4 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Energy Recovery, Inc. reported adjusted EPS loss of $0.09 per share. By that measure, the company missed the mean analyst estimate of $-0.05. It missed the average revenue estimate of $7.35 million.

Quoting Management: Tom Rooney, President and Chief Executive Officer, commented, “The first quarter results were in line with our expectations, as mega-project activity is expected to commence in the second quarter and increase sequentially throughout the year. While we anticipate similar revenue levels in 2013 as compared to those achieved in 2012, with the fourth quarter representing a significant portion of revenue due to the timing of mega-project shipments, we expect to drive improved bottom-line performance through ongoing cost-reduction and efficiency-enhancing initiatives that are estimated to favorably affect gross profit margins. Beyond 2013, we anticipate significant growth in 2014 as the sales pipeline for major desalination projects firms up and our oil & gas strategy continues to progress. We remain focused on our strategy to maintain a commanding position in the core desalination market, marked by strong market share and increasing profitability, while investing heavily in new market expansion with a preeminent focus on oil & gas applications. Thus, we remain excited about the prospects of this great company and our progress against strategic and financial objectives.”

Key Stats (on next page)…

Revenue decreased 57.56% from $15.08 million in the previous quarter. EPS decreased to $-0.09 in the quarter versus EPS of $-0.02 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a loss of $0.04 to a loss $0.05. For the current year, the average estimate has moved down from a loss of $0.05 to a loss of $0.08 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at]