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Calgon Wins Two Contracts

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Calgon Carbon Corporation (CCC - Free Report) ) has won two new contracts to supply Sentinel Ultraviolet (UV) Disinfection Systems at drinking water production plants in the cities of Indianapolis and Fort Wayne, Indiana.

Indianapolis will use 12 Sentinel Ultraviolet Disinfection Systems at a plant to protect up to 44 million gallons of drinking water daily against surface pathogens like Cryptosporidium. Fort Wayne plans three ultraviolet disinfection systems at a filtration plant processing 72 million gallons daily.

The Indianapolis project is scheduled for completion by the end of 2011 while the Fort Wayne installation is scheduled for June 2012.  The terms of the contract were not disclosed.

Both the sentinel systems have undergone third party compliance in accordance with the U.S. Environmental Protection Agency’s UV Disinfection Guidance Manual.  Both Systems feature UV intensity sensors to ensure accurate delivery of UV dose, an automatic quartz sleeve cleaning system, and a fully automated control system.

About a month ago, the Hyde Marine, a wholly owned subsidiary of Calgon Carbon was awarded three contracts to supply a total of 13 Hyde GUARDIAN Ballast Water Treatment (BWT) Systems for use on various vessels.

In April 2011, Calgon Carbon reported a profit of 15 cents per share in the first quarter of 2011 compared with 17 cents in the year-ago quarter. Sales in the quarter increased 20.8% to $124.4 million.

The company expects the margins of Calgon Carbon to continue improving throughout 2011. In 2011, in order to meet customer demand, the company expects to supplement activated carbon that it produces with lower-margin outsourced products.

Calgon will continue to progress by implementing its pricing and reactivation strategies, which are anticipated to improve its Carbon and Service business.

Calgon competes with MeadWestvaco Corporation ().

We currently maintain a Zacks #3 Rank (short-term Hold recommendation) on Calgon and a long-term Neutral recommendation.

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