The following is a summary of the Hudson Technologies, Inc. (HDSN) Q2 2024 Earnings Call Transcript:

Financial Performance:

• In Q2 2024, Hudson Technologies reported revenues of $75.3 million, marking a 17% decrease compared to $90.5 million in the same period last year.

• Despite strong volume growth of 17% in refrigerant sales, revenue and margin were negatively impacted by a significant 25% price decline in certain refrigerants compared to Q2 2023.

• Gross margin for the quarter stood at 30%, down from 41% the previous year, affected by lower refrigerant prices.

• Net income for Q2 2024 reached $9.6 million, or $0.20 per diluted share, compared to $19.2 million, or $0.41 per diluted share in Q2 2023.

Business Progress:

• Hudson Technologies' acquisition of USA Refrigerants aims to enhance its capabilities in refrigerant recovery and reclamation.

• The company anticipates stronger gross margins from reclaimed refrigerants, which typically yield double the margins compared to newly manufactured ones.

• With the acquisition and enhanced focus on refrigerant procurement and management, Hudson expects to see growth in profitability and operational efficiency in the reclamation space.

• They have initiated a share repurchase program, underlining the management's confidence in the long-term prospects of the company.

Opportunities:

• The upcoming EPA's final Refrigerant Management Rule which mandates the use of reclaimed refrigerants in certain applications promises regulatory tailwinds for Hudson's business model.

• State-level mandates, like California's decision to use reclaimed refrigerants starting 2025, present additional opportunities for market expansion and increased demand for reclaimed products.

Risks:

• Persisting pricing pressures on refrigerants could continue affecting revenue and margin performance negatively if not mitigated.

• International trade regulations impacting refrigerant imports could influence market dynamics and input costs.

More details: Hudson Technologies IR

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