Active Power Reports First Quarter 2016 Results
Highlights
- First quarter revenues declined sequentially and year-over-year following low bookings in the fourth quarter of 2015 and deliveries of existing orders shifting to later periods
- Bookings improved 25% to
$10.0 million compared to$8 million in the fourth quarter of 2015; book-to-bill ratio above 1.0 in eight of the last nine quarters - Operating expenses decreased 18% or
$1.1 million from the first quarter of 2015 and 20% or$1.1 million from the previous quarter; expenses down eight of the last 10 quarters - Backlog at
March 31, 2016 , was$35.1 million compared to$30.8 million atDecember 31, 2015 - Appointed
Daryl Dulaney andSteven Sams to the company's board of directors, two industry veterans with proven track records in building and leading businesses atSiemens andIBM , respectively, with Dulaney having succeeded Dr. Ake Almgren as board chairman atApril 23, 2016
First Quarter 2016 Financial Results
Revenue in the first quarter of 2016 was
Gross margin in the first quarter of 2016 was 14% compared to 33% in the year-ago period and 25% in the previous quarter. The decrease in gross margin from both periods is primarily related to under absorption of fixed overhead costs in manufacturing against substantially lower product revenues and a decline in the volume of service revenue which traditionally has higher margins.
Operating expenses in the first quarter of 2016 were
Net loss in the first quarter of 2016 was
Adjusted EBITDA in the first quarter of 2016 was a loss of
Cash and cash equivalents totaled
Bookings and Backlog
Bookings in the first quarter of 2016 were
Management Commentary
"As we anticipated given the low bookings in the fourth quarter, the first quarter was challenging as product revenue declined significantly," said
"We remain committed to our priorities of increasing bookings and backlog and continued improvements in operational efficiencies and expense management as we move through 2016. Feedback from field sales indicates our total cost of ownership proposition has become even more compelling in this cost conscious environment."
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About
Non-GAAP Financial Measure
This press release includes information about adjusted EBITDA, which is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles ("GAAP"). At the end of the following tables,
Cautionary Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by references to future periods, and include, without limitation, statements we make regarding:
- our expectations that we can increase bookings and backlog;
- our belief that we can improve operational efficiencies; and
- our ability to control our future expenses.
Actual results and the outcomes of future events could differ materially from those expressed or implied by these forward-looking statements because of a number of risks and uncertainties, including: the deferral or cancellation of sales commitments as a result of general economic conditions or uncertainty; the possibility backlog may not result in revenue; financial results that may vary significantly from quarter to quarter due to seasonality and volatility in customer demand; our continued ability to obtain sufficient working capital to fund our operations; risks related to our international operations; our dependence on our relationships with
For more information on the risk factors that could cause actual results to differ from these forward looking statements, please refer to
Active Power, Inc. | ||||||||||
Condensed Consolidated Statement of Operations | ||||||||||
(in thousands, except per share amounts) | ||||||||||
Three Months Ended March 31, |
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(unaudited) | ||||||||||
2016 | 2015 | |||||||||
Revenues: | ||||||||||
Product revenue | $ | 2,840 | $ | 9,548 | ||||||
Service and other revenue | 2,825 | 3,581 | ||||||||
Total revenue | 5,665 | 13,129 | ||||||||
Cost of goods sold: | ||||||||||
Cost of product revenue | 3,141 | 6,971 | ||||||||
Cost of service and other revenue | 1,706 | 1,851 | ||||||||
Total cost of goods sold | 4,847 | 8,822 | ||||||||
Gross profit | 818 | 4,307 | ||||||||
Operating expenses: | ||||||||||
Research and development | 1,196 | 1,516 | ||||||||
Selling and marketing | 2,173 | 2,706 | ||||||||
General and administrative | 1,362 | 1,558 | ||||||||
Total operating expenses | 4,731 | 5,780 | ||||||||
Loss from Operations | (3,913 | ) | (1,473 | ) | ||||||
Interest expense, net | (85 | ) | (79 | ) | ||||||
Other income (expense), net | (57 | ) | (7 | ) | ||||||
Net loss | $ | (4,055 | ) | $ | (1,559 | ) | ||||
Net Loss per share, basic and diluted | $ | (0.18 | ) | $ | (0.07 | ) | ||||
Shares used in computing net loss per share, basic and diluted | 23,139 | 23,130 | ||||||||
Active Power, Inc. | ||||||||||
Condensed Consolidated Balance Sheets | ||||||||||
(in thousands, except par value) | ||||||||||
March 31, 2016 |
December 31, 2015 |
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ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 11,220 | $ | 12,260 | ||||||
Restricted cash | 38 | 36 | ||||||||
Accounts receivable, net of allowance for doubtful accounts of $71 and $70 at March 31, 2016 and December 31, 2015, respectively | 5,066 | 8,849 | ||||||||
Inventories, net | 8,353 | 6,466 | ||||||||
Prepaid expenses and other | 726 | 792 | ||||||||
Total current assets | 25,403 | 28,403 | ||||||||
Property and equipment, net | 1,599 | 1,914 | ||||||||
Deposits and other | 275 | 278 | ||||||||
Total assets | $ | 27,277 | $ | 30,595 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 2,411 | $ | 2,852 | ||||||
Accrued expenses | 3,673 | 4,494 | ||||||||
Deferred revenue | 5,383 | 3,576 | ||||||||
Revolving line of credit | 5,535 | 5,535 | ||||||||
Total current liabilities | 17,002 | 16,457 | ||||||||
Long-term liabilities | 465 | 583 | ||||||||
Commitments and contingencies | ||||||||||
Stockholders' equity | ||||||||||
Preferred stock - $0.001 par value; 2,000 shares authorized | - | - | ||||||||
Common stock - $0.001 par value; 40,000 shares authorized; 23,173 and 23,171 issued and 23,110 and 23,109 outstanding at March 31, 2016 and December 31, 2015, respectively | 23 | 23 | ||||||||
Treasury stock | (241 | ) | (240 | ) | ||||||
Additional paid-in capital | 304,461 | 304,094 | ||||||||
Accumulated deficit | (294,509 | ) | (290,454 | ) | ||||||
Other accumulated comprehensive income | 76 | 132 | ||||||||
Total stockholders' equity | 9,810 | 13,555 | ||||||||
Total liabilities and stockholders' equity | $ | 27,277 | $ | 30,595 | ||||||
Active Power, Inc. | |||||||||||||||||||
Supplemental Information (in thousands) | |||||||||||||||||||
Revenue by Product | Three Months Ended | ||||||||||||||||||
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March 31, 2016 |
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% of total |
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March 31, 2015 |
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% of total | |
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December 31, 2015 |
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% of total | |
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UPS | $ | 2,682 | 47 | % | $ | 7,177 | 55 | % | $ | 9,503 | 76 | % | |||||||
MIS | 158 | 3 | % | 2,371 | 18 | % | 123 | 1 | % | ||||||||||
Total Product Revenue | 2,840 | 50 | % | 9,548 | 73 | % | 9,626 | 77 | % | ||||||||||
Service | 2,825 | 50 | % | 3,581 | 27 | % | 2,899 | 23 | % | ||||||||||
Total Revenue | $ | 5,665 | 100 | % | $ | 13,129 | 100 | % | $ | 12,525 | 100 | % | |||||||
Revenue by Geography | |||||||||||||||||||
Americas | $ | 3,777 | 67 | % | $ | 9,863 | 75 | % | $ | 9,566 | 76 | % | |||||||
EMEA | 906 | 16 | % | 3,024 | 23 | % | 2,541 | 20 | % | ||||||||||
Asia | 982 | 17 | % | 242 | 2 | % | 418 | 3 | % | ||||||||||
Total Revenue | $ | 5,665 | 100 | % | $ | 13,129 | 100 | % | $ | 12,525 | 100 | % | |||||||
Active Power, Inc. | |||||||||||||||
Supplemental Information (in thousands) | |||||||||||||||
Total Bookings | |||||||||||||||
March 31, 2015 |
June 30, 2015 |
September 30, 2015 |
December 31, 2015 |
March 31, 2016 |
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Bookings | $ | 19,171 | $ | 17,322 | $ | 16,992 | $ | 8,043 | $ | 10,040 | |||||
Book to Bill Ratio | 1.46 | 1.03 | 1.14 | 0.64 | 1.77 | ||||||||||
Reconciliation of Net Loss to Adjusted EBITDA | |||||||||||||
(in thousands) | |||||||||||||
Three Months Ended | |||||||||||||
March 31, | March 31, | December 31, | |||||||||||
2016 | 2015 | 2015 | |||||||||||
Net Loss | $ | (4,055 | ) | $ | (1,559 | ) | $ | (2,906 | ) | ||||
Interest Expense | 85 | 79 | 123 | ||||||||||
Depreciation Expense | 217 | 293 | 234 | ||||||||||
Stock Based Compensation | 367 | 323 | 385 | ||||||||||
Impairment of Long-Lived Assets | - | - | - | ||||||||||
Adjusted EBITDA | $ | (3,386 | ) | $ | (864 | ) | $ | (2,164 | ) | ||||
About Presentation of Adjusted EBITDA
Adjusted EBITDA is not a financial measure calculated and presented in accordance with GAAP, and should not be considered as an alternative to net income, operating income or any other financial measures so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The company defines adjusted EBITDA as net loss before impairment of long-lived assets, depreciation, interest, and non-cash stock based compensation. Other companies (including competitors) may define adjusted EBITDA differently. The company presents adjusted EBITDA because management believes it to be an important supplemental measure of performance that is commonly used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. Management also uses this information internally for forecasting and budgeting. It may not be indicative of the historical operating results of
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