Superconductor Technologies Reports 2013 Fourth Quarter and Year-End Results
March 27 2014 - 6:28AM
Achieves Goals That Further HTS Wire's Path to
Commercialization
Generates $3.7 Million in Cash
Through Warrant Exercises Jan. 1st to Mar. 21st
Superconductor Technologies Inc. (STI) (Nasdaq:SCON), a world
leader in the development and production of high temperature
superconducting (HTS) materials and associated technologies,
reported results for the quarter and year-ended December 31,
2013.
"During 2013, we set the stage to produce Conductus® wire on a
commercial scale in 2014 and beyond," said Jeff Quiram, STI's
president and chief executive officer. "In the first three months
of 2014, we continued to experience an increase in customer demand
for Conductus wire for product qualification. Recently, we shipped
hundreds of meters of Conductus wire that performed at currents as
high as 450 Amps per centimeter (A/cm). We believe we are close to
successfully completing the testing process with several valuable
customers. Our goal is to continue to secure additional purchase
orders and enter into new business agreements that consume all the
additional capacity of Conductus wire as we ramp supply in the
second half of 2014. Global forecasted demand from our customers
for superconductor wire continues to grow and exceed our planned
production capacity.
"Our fully loaded RCE-CDR pilot equipment produced Conductus
wire with over 90% of the output performing at an average of
350A/cm and with high uniformity across its length and width. By
achieving this important manufacturing milestone, we have
demonstrated, on a pilot level, the high performance, yield and
scalability of our production process. In January, we began the
fabrication of sub-assemblies for our first 1 kilometer (km)
RCE-CDR machine. The system is scheduled to be production ready
late in the second quarter of 2014 and achieve commercial
production levels in 2014.The project costs are in line with our
expectations. We are on track to have 750km in annual production
volume when our first 1km RCE-CDR machine is running at full
capacity."
STI's fourth quarter 2013 net revenues was $150,000, compared to
$229,000 in the third quarter of 2013 and $1.1 million in the
fourth quarter of 2012. Revenue for all periods was primarily from
legacy wireless products. Net loss for the fourth quarter of 2013
was $3.9 million, or a loss of $0.34 per basic and diluted share,
compared to a net loss of $3.5 million, or a loss of $0.42 per
basic and diluted share, in the third quarter of 2013, and a net
loss of $2.3 million, or a loss of $0.65 per basic and diluted
share, in the fourth quarter of 2012.
For the full year 2013, total net revenues were $1.7 million,
compared to $3.5 million for 2012. Revenue for all periods was
primarily from legacy wireless products. The net loss for 2013 was
$12.2 million, or $1.71 per share, compared to a net loss of $10.9
million, or $3.34 per share, for 2012.
As of December 31, 2013, STI had $7.5 million in cash and cash
equivalents. Since January 1, 2014 through March 21, 2014,
investors have exercised 1.4 million warrants, resulting in cash
proceeds to the company of $3.7 million.
"We are extremely pleased with the confidence in STI
demonstrated by our investors through their increased investment.
This additional cash enables us to focus on the execution and
growth of our Conductus wire initiative," concluded Quiram.
Investor Conference Call
STI will host a conference call and simultaneous webcast today,
March 27th at 11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time to
discuss its results. Participating in the call will be Jeff Quiram,
president and chief executive officer; and Bill Buchanan, vice
president and chief financial officer. To listen to the call live,
please dial 1-877-941-0844 at least 10 minutes before the start of
the conference. International participants may dial 1-480-629-9835.
The conference ID is 4671851. The call will be webcast and can be
accessed from the "Investor Relations" section of the company's
website at http://www.suptech.com. A telephone replay will be
available until midnight ET on April 1st by dialing 1-800-406-7325
or 1-303-590-3030, and entering pass code 4671851. A replay will
also be available at the web address above.
About Superconductor Technologies Inc.
(STI)
Superconductor Technologies Inc., headquartered in Austin, TX,
has been a world leader in HTS materials since 1987, developing
more than 100 patents as well as proprietary trade secrets and
manufacturing expertise. For more than a decade, STI has been
providing innovative interference elimination and network
enhancement solutions to the commercial wireless industry. The
company is currently leveraging its key enabling technologies,
including RF filtering, HTS materials and cryogenics to develop
energy efficient, cost-effective and high performance second
generation (2G) HTS wire for existing and emerging power
applications, to develop applications for advanced RF wireless
solutions and innovative adaptive filtering, and for government
R&D. Superconductor Technologies Inc.'s common stock is listed
on the NASDAQ Capital Market under the ticker symbol "SCON." For
more information about STI, please visit
http://www.suptech.com.
Safe Harbor
Statement
Statements in this press release regarding our business that are
not historical facts are "forward-looking statements" that involve
risks and uncertainties. Forward-looking statements are not
guarantees of future performance and are inherently subject to
uncertainties and other factors, which could cause actual results
to differ materially from the forward-looking statements. These
factors and uncertainties include, but are not limited to: our
limited cash and a history of losses; the limited number of
potential customers; the limited number of suppliers for some of
our components and our HTS wire; there being no significant backlog
from quarter to quarter; our market being characterized by rapidly
advancing technology; overcoming technical challenges in attaining
milestones to develop and manufacture commercial lengths of our HTS
wire; customer acceptance of our HTS wire; fluctuations in product
demand from quarter to quarter; the impact of competitive filter
products, technologies and pricing; manufacturing capacity
constraints and difficulties; our ability to raise sufficient
capital to fund our operations (whether through registered direct
offerings or otherwise), and the impact on our strategic wire
initiative of any inability to raise such funds; the impact of any
such financing activity on the level of our stock price, which may
decline in connection with the sales under registered direct
offerings or otherwise; the dilutive impact of any issuances of
securities to raise capital; and local, regional, and national and
international economic conditions and events and the impact they
may have on us and our customers, such as the current worldwide
recession.
Forward-looking statements can be affected by many other
factors, including, those described in the "Business" and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" sections of STI's Annual Report on Form 10-K
for the year ended December 31, 2012 and in STI's other public
filings. These documents are available online at STI's website,
www.suptech.com, or through the SEC's website, www.sec.gov.
Forward-looking statements are based on information presently
available to senior management, and STI has not assumed any duty to
update any forward-looking statements.
Investor Relations Contact Cathy Mattison or
Kirsten Chapman LHA +1-415-433-3777 invest@suptech.com
– Tables to Follow –
SUPERCONDUCTOR
TECHNOLOGIES INC. |
CONSOLIDATED STATEMENT
OF OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
Year
Ended |
|
December 31,
2013 |
December 31,
2012 |
December 31,
2013 |
December 31,
2012 |
|
unaudited |
unaudited |
audited |
Net revenues: |
|
|
|
|
Net commercial product
revenues |
$ 150,000 |
$ 1,063,000 |
$ 1,710,000 |
$ 3,237,000 |
Government and other contract
revenues |
-- |
70,000 |
-- |
222,000 |
|
|
|
|
|
Total net
revenues |
150,000 |
1,133,000 |
1,710,000 |
3,459,000 |
|
|
|
|
|
Costs and expenses: |
|
|
|
|
Cost of commercial product
revenue |
141,000 |
907,000 |
1,051,000 |
3,850,000 |
Cost of government and other
contract revenue |
-- |
52,000 |
-- |
165,000 |
Research and development |
1,349,000 |
1,240,000 |
6,073,000 |
5,030,000 |
Selling, general and
administrative |
1,159,000 |
1,241,000 |
5,068,000 |
5,440,000 |
Total costs and
expenses |
2,649,000 |
3,440,000 |
12,192,000 |
14,485,000 |
|
|
|
|
|
Loss from operations |
(2,499,000) |
(2,307,000) |
(10,482,000) |
(11,026,000) |
|
|
|
|
|
Other Income and Expense |
|
|
|
|
Loss from investment in
Resonant LLC |
-- |
-- |
(238,000) |
-- |
Adjustments to fair value of
derivatives |
(1,466,000) |
|
(1,551,000) |
-- |
Interest income |
-- |
-- |
-- |
6,000 |
Other income |
132,000 |
48,000 |
140,000 |
92,000 |
Other expense |
(42,000) |
-- |
(42,000) |
-- |
Net loss |
$ (3,875,000) |
$ (2,259,000) |
$ (12,173,000) |
$ (10,928,000) |
|
|
|
|
|
Basic and diluted loss per common
share |
$ (0.34) |
$ (0.65) |
$ (1.71) |
$ (3.34) |
|
|
|
|
|
Weighted average number of common shares
issued and outstanding |
11,527,366 |
3,490,231 |
7,123,817 |
3,269,482 |
|
SUPERCONDUCTOR
TECHNOLOGIES INC. |
CONSOLIDATED BALANCE
SHEETS |
|
|
|
|
December 31, |
December 31, |
|
2013 |
2012 |
ASSETS |
|
|
Current Assets: |
|
|
Cash and cash equivalents |
$ 7,459,000 |
$ 3,634,000 |
Accounts receivable, net |
6,000 |
122,000 |
Inventory, net |
76,000 |
51,000 |
Prepaid expenses and other
current assets |
437,000 |
315,000 |
Total Current Assets |
7,978,000 |
4,122,000 |
|
|
|
Property and equipment, net of
accumulated depreciation of $11,626,000 and $19,445,000,
respectively |
5,473,000 |
6,242,000 |
Patents, licenses and purchased
technology, net of accumulated amortization of $722,000 and
$2,367,000, respectively |
888,000 |
889,000 |
Other assets |
501,000 |
776,000 |
Total
Assets |
$ 14,840,000 |
$ 12,029,000 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
Current Liabilities: |
|
|
Accounts payable |
$ 703,000 |
$ 603,000 |
Accrued expenses |
637,000 |
460,000 |
Total Current Liabilities |
1,340,000 |
1,063,000 |
|
|
|
Other long term liabilities |
6,194,000 |
674,000 |
Total Liabilities |
7,534,000 |
1,737,000 |
|
|
|
Commitments and contingencies (Notes 7
and 8) |
|
|
|
|
|
Stockholders' Equity: |
|
|
Preferred stock, $.001 par
value, 2,000,000 shares authorized, 328,925 and 564,642 issued and
outstanding, respectively |
-- |
1,000 |
Common stock, $.001 par value,
250,000,000 shares authorized, 11,634,950 and 4,193,690 shares
issued and outstanding, respectively |
12,000 |
4,000 |
Capital in excess of par
value |
281,411,000 |
272,231,000 |
Accumulated deficit |
(274,117,000) |
(261,944,000) |
Total Stockholders' Equity |
7,306,000 |
10,292,000 |
|
|
|
Total Liabilities and
Stockholders' Equity |
$ 14,840,000 |
$ 12,029,000 |
|
SUPERCONDUCTOR
TECHNOLOGIES INC. |
CONSOLIDATED STATEMENTS
OF CASH FLOWS |
|
|
|
|
|
Years Ended
December 31, |
|
2013 |
2012 |
2011 |
CASH FLOWS FROM OPERATING
ACTIVITIES: |
|
|
|
Net loss |
$ (12,173,000) |
$ (10,928,000) |
$ (13,383,000) |
Adjustments to reconcile net loss to net cash
used for operating activities: |
|
|
|
Depreciation and
amortization |
1,276,000 |
313,000 |
805,000 |
Stock-based compensation
expense |
492,000 |
854,000 |
1,563,000 |
Provision for excess and
obsolete inventories |
-- |
270,000 |
717,000 |
Write off of intangibles |
93,000 |
213,000 |
844,000 |
Adjustment to fair value of
warrant derivatives |
1,551,000 |
-- |
-- |
(Gain) loss on disposal of
property and equipment |
239,000 |
(92,000) |
(269,000) |
Loss from investment in
Resonant LLC joint venture |
238,000 |
-- |
-- |
Changes in assets and
liabilities: |
|
|
|
Accounts receivable |
116,000 |
(61,000) |
46,000 |
Inventories |
(25,000) |
1,289,000 |
(96,000) |
Prepaid expenses and other
current assets |
(122,000) |
159,000 |
(127,000) |
Patents and licenses |
(160,000) |
(199,000) |
(66,000) |
Other assets |
(148,000) |
9,000 |
(152,000) |
Accounts payable, accrued
expenses and other liabilities |
324,000 |
(53,000) |
100,000 |
Net cash used in operating
activities |
(8,299,000) |
(8,226,000) |
(10,018,000) |
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES: |
|
|
|
Purchase of property and
equipment |
(818,000) |
(3,588,000) |
(2,254,000) |
Net proceeds from sale of
property and equipment |
98,000 |
92,000 |
269,000 |
Net cash used in investing
activities |
(720,000) |
(3,496,000) |
(1,985,000) |
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES: |
|
|
|
Repurchase of common shares for withholding
obligations |
-- |
(120,000) |
(303,000) |
Net proceeds from sale of common stock |
12,844,000 |
9,311,000 |
12,402,000 |
|
|
|
|
Net cash provided by financing
activities |
12,844,000 |
9,191,000 |
12,099,000 |
Net increase (decrease) in cash and cash
equivalents |
3,825,000 |
(2,531,000) |
96,000 |
Cash and cash equivalents at beginning of
year |
3,634,000 |
6,165,000 |
6,069,000 |
Cash and cash equivalents at end of year |
$ 7,459,000 |
$ 3,634,000 |
$ 6,165,000 |
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