AMSC (NASDAQ:AMSC), a global solutions provider serving wind and
power grid industry leaders, today announced several agreements
with Inox Wind Limited (Inox) that strengthen the collaboration
between the two companies. The company announced it has entered
into a long-term supply contract (Supply Contract) with Inox.
Under the Supply Contract, AMSC will provide Inox with electrical
control systems (ECS) for Inox’s entire 2MW product
line. Full deliveries under the Supply Contract are
expected to begin during the first quarter of fiscal
2016. Under a separate agreement, Inox will be allowed
to internally manufacture a limited portion of the ECS requirements
for its 2MW product line as a second source based on AMSC’s
technology. The aggregate value of these agreements is
approximately $210 million over the next three to four years, when
the specified deliveries under this contract are expected to be
completed. Once the specified deliveries under the Supply
Contract are completed, further revenues are expected for at least
an additional three year period during which AMSC will provide Inox
with the majority of its 2MW ECS requirements under a preferred
supplier arrangement.
The relationship continues in developing new wind turbine
products focused on the Indian market. AMSC and Inox entered
into a heads of agreement to collaborate on the development of a
3MW wind turbine to extend to Inox’s product line. AMSC would
develop a 3MW wind turbine design under a license agreement to be
negotiated with Inox.
“With the rapid growth of our business, we felt it was important
to deepen our partnership with AMSC, while at the same time enhance
our internal manufacturing capabilities,” said Devansh Jain,
director of Inox Wind Limited. “We value the relationship with
AMSC, which has allowed us to offer our customers wind turbines
with superior technology and performance. We are on track
with our wind turbine manufacturing expansion and continue to
strengthen our position in the Indian market.”
AMSC’s ECS are an integrated, high-performance suite of power
electronics systems that include the wind turbine power converter
cabinet, internal power supply and various controls. Together,
these systems serve as the “brains” of the wind turbine and enable
reliable, high-performance operation by controlling power flows,
regulating voltage, monitoring system performance, controlling the
pitch of the wind turbine blades and the yaw of the turbines to
maximize efficiency.
“These agreements represent an important milestone for AMSC and
solidify our belief that Inox is a trusted and valued long-term
partner,” said Daniel P. McGahn, President and CEO, AMSC. “We
anticipate that our expanded relationship with Inox will provide a
solid foundation for our business which we can build around and
enable Inox to become the largest wind turbine manufacturer in
India.”
The Indian government has targeted to grow its installed wind
power generating capacity from more than 22GW in 2014 to more than
100GW by 2022.
To learn more about AMSC’s product offerings for the wind
industry, please visit: http://www.amsc.com/windtec/index.html.
Conference Call
In conjunction with this announcement, AMSC management will
participate in a conference call with investors beginning at 9:00
am Eastern Time on Monday, December 21, 2015. On this call,
management will discuss the business and financial impact of the
strategic agreements with Inox discussed in this press release.
Those who wish to listen to the live or archived conference call
webcast should visit the "Investors" section of the company's
website at http://www.amsc.com/investors. The live call also can be
accessed by dialing 719-325-2448 and using conference ID
692497.
About Inox Wind Limited
Inox Wind Limited is part of the Inox Group of Companies. Inox
Group is a $2 billion+, professionally managed business group, with
interests in diverse businesses including Industrial Gases,
Refrigerants,Engineering Plastics, Chemicals, Carbon Credits,
Cryogenic Engineering, Renewable Energy and Entertainment. Inox
Wind Limited has firm orders for more than 1,200 MW of wind
turbines as of September 30, 2015. The INOX Group employs close to
9,000 people at more than 150 business units across the country and
has a distribution network that is spread across more than 50
countries around the globe. Each INOX Group company is
characterized by three distinct characteristics - early
identification of a winning business idea, building it to a size of
dominant market leadership in that segment, and attaining a profit
leadership position through cutting-edge efficiency in operations.
The Inox Group of Companies, besides Inox Wind Limited, includes
Inox Air Products Limited, Gujarat Fluorochemicals Limited, Inox
India Limited, Inox Renewables Limited, Inox Leisure Limited and
Fame India limited. More information is available at
www.inoxwind.com.
About AMSC (NASDAQ:AMSC)
AMSC generates the ideas, technologies and solutions that meet
the world’s demand for smarter, cleaner … better energy. Through
its Windtec™ Solutions, AMSC provides wind turbine electronic
controls and systems, designs and engineering services that reduce
the cost of wind energy. Through its Gridtec™ Solutions, AMSC
provides the engineering planning services and advanced grid
systems that optimize network reliability, efficiency and
performance. The company’s solutions are now powering gigawatts of
renewable energy globally and enhancing the performance and
reliability of power networks in more than a dozen countries.
Founded in 1987, AMSC is headquartered near Boston, Massachusetts
with operations in Asia, Australia, Europe and North America. For
more information, please visit www.amsc.com.
AMSC, Windtec, Gridtec, and Smarter, Cleaner … Better Energy are
trademarks or registered trademarks of American Superconductor
Corporation. All other brand names, product names, trademarks or
service marks belong to their respective holders.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”). Any statements in this release
about expectations regarding the value of the agreements with Inox;
timing of the commencement of deliveries under the Supply Contract;
timing of when deliveries under the Supply Contract are expected to
be completed; the availability of further revenues after the
completion of deliveries under the Supply Contract; Inox being a
trusted and valued long-term partner; effects of our relationship
with Inox on our business; Inox becoming the largest wind turbine
manufacturer in India; the growth of India’s wind installations;
and other statements containing the words “believes,”
“anticipates,” “plans,” “expects,” “will” and similar expressions,
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements represent management’s current
expectations and are inherently uncertain. There are a number of
important factors that could materially impact the value of our
common stock or cause actual results to differ materially from
those indicated by such forward-looking statements. Such factors
include: We have a history of operating losses, which may continue
in the future. Our operating results may fluctuate significantly
from quarter to quarter and may fall below expectations in any
particular fiscal quarter; we have a history of negative operating
cash flows, and we may require additional financing in the future,
which may not be available to us; Our Term Loans include certain
covenants and other events of default. Should we not comply with
these covenants or incur an event of default, we may be required to
repay our obligation in cash, which could have an adverse effect on
our liquidity; We may be required to issue performance bonds or
provide letters of credit, which restricts our ability to access
any cash used as collateral for the bonds or letters of credit;
Changes in exchange rates could adversely affect our results from
operations; If we fail to maintain proper and effective internal
controls over financial reporting, our ability to produce accurate
and timely financial statements could be impaired and may lead
investors and other users to lose confidence in our financial data;
Our financial condition may have an adverse effect on our customer
and supplier relationships; Our success in addressing the wind
energy market is dependent on the manufacturers that license our
designs; A significant portion of our revenues are derived from a
single customer, Our success is dependent upon attracting and
retaining qualified personnel and our inability to do so could
significantly damage our business and prospects; We may not realize
all of the sales expected from our backlog of orders and contracts;
Our business and operations would be adversely impacted in the
event of a failure or security breach of our information technology
infrastructure; We may not be able to ramp up production at our
newly leased manufacturing facility in Romania, and, if we are able
to do so, we may have manufacturing quality issues, which would
negatively affect our revenues and financial position; We rely upon
third-party suppliers for the components and subassemblies of many
of our Wind and Grid products, making us vulnerable to supply
shortages and price fluctuations, which could harm our business;
Many of our revenue opportunities are dependent upon subcontractors
and other business collaborators; If we fail to implement our
business strategy successfully, our financial performance could be
harmed; Problems with product quality or product performance may
cause us to incur warranty expenses and may damage our market
reputation and prevent us from achieving increased sales and market
share; New regulations related to conflict-free minerals may force
us to incur significant additional expenses; Our contracts with the
U.S. government are subject to audit, modification or termination
by the U.S. government and include certain other provisions in
favor of the government. The continued funding of such contracts
remains subject to annual congressional appropriation which, if not
approved, could reduce our revenue and lower or eliminate our
profit; Many of our customers outside of the United States,
particularly in China, are, either directly or indirectly, related
to governmental entities, and we could be adversely affected by
violations of the United States Foreign Corrupt Practices Act and
similar worldwide anti-bribery laws outside the United States; We
have limited experience in marketing and selling our superconductor
products and system-level solutions, and our failure to effectively
market and sell our products and solutions could lower our revenue
and cash flow; We may acquire additional complementary businesses
or technologies, which may require us to incur substantial costs
for which we may never realize the anticipated benefits; Our
success depends upon the commercial use of high temperature
superconductor (HTS) products, which is currently limited, and a
widespread commercial market for our products may not develop;
Growth of the wind energy market depends largely on the
availability and size of government subsidies and economic
incentives; We have operations in and depend on sales in emerging
markets, including India and China, and global conditions could
negatively affect our operating results or limit our ability to
expand our operations outside of these countries. Changes in
India’s or China’s political, social, regulatory and economic
environment may affect our financial performance; Our products face
intense competition, which could limit our ability to acquire or
retain customers; Our international operations are subject to risks
that we do not face in the United States, which could have an
adverse effect on our operating results; Adverse changes in
domestic and global economic conditions could adversely affect our
operating results; We may be unable to adequately prevent
disclosure of trade secrets and other proprietary information; Our
patents may not provide meaningful protection for our technology,
which could result in us losing some or all of our market position;
There are a number of technological challenges that must be
successfully addressed before our superconductor products can gain
widespread commercial acceptance, and our inability to address such
technological challenges could adversely affect our ability to
acquire customers for our products; Third parties have or may
acquire patents that cover the materials, processes and
technologies we use or may use in the future to manufacture our
Amperium products, and our success depends on our ability to
license such patents or other proprietary rights; Our technology
and products could infringe intellectual property rights of others,
which may require costly litigation and, if we are not successful,
could cause us to pay substantial damages and disrupt our business;
We have filed a demand for arbitration and other lawsuits against
our former largest customer, Sinovel, regarding amounts we contend
are overdue. We cannot be certain as to the outcome of these
proceedings; We have been named as a party in various legal
proceedings, and we may be named in additional litigation, all of
which will require significant management time and attention,
result in significant legal expenses and may result in an
unfavorable outcome, which could have a material adverse effect on
our business, operating results and financial condition; and Our
common stock has experienced, and may continue to experience,
significant market price and volume fluctuations, which may prevent
our stockholders from selling our common stock at a profit and
could lead to costly litigation against us that could divert our
management’s attention.
These and the important factors discussed under the caption
“Risk Factors” in Part 1. Item 1A of our Form 10-K for the fiscal
year ended March 31, 2015, and our other reports filed with the
SEC, among others, could cause actual results to differ materially
from those indicated by forward-looking statements made herein and
presented elsewhere by management from time to time. Any such
forward-looking statements represent management’s estimates as of
the date of this press release. While we may elect to update such
forward-looking statements at some point in the future, we disclaim
any obligation to do so, even if subsequent events cause our views
to change. These forward-looking statements should not be relied
upon as representing our views as of any date subsequent to the
date of this press release.
AMSC Contact:
Brion D. Tanous
Phone: 978-842-3247
Email: Brion.Tanous @ amsc.com
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