Capstone Turbine Reports First Quarter Fiscal 2017 Financial Results
August 04 2016 - 4:15PM
Capstone Turbine Corporation (www.capstoneturbine.com)
(Nasdaq:CPST), the world’s leading clean technology manufacturer of
microturbine energy systems, reported financial results for its
first quarter of fiscal 2017 ended June 30, 2016.
The company reported total revenue of $19.1 million for the
first quarter of fiscal 2017 and a net loss of $4.5 million, or
$0.17 per share. This compares with total revenue of $27.0 million
and a net loss of $6.0 million, or $0.36 per share, reported for
the first quarter of fiscal 2016.
Darren Jamison, President and Chief Executive Officer of
Capstone, said, “With our goal of achieving near-term profitability
via our three-pronged strategic plan, we successfully lowered our
net loss year-over-year despite a 29% reduction in revenue. This
was achieved primarily by lowering our operating expenses 30% below
last year’s first quarter. In addition, we have made solid strides
in diversifying our business into the energy efficiency space and
into target growth geographies. The quarter-over-quarter revenue
decline was expected and is a result of the ongoing volatility of
the global oil and gas markets, a stronger U.S. dollar and
continued geopolitical strife in several of our end markets.”
Mr. Jamison continued, “We are successfully diversifying our
market verticals and concentrating on new growth markets. This was
evidenced during the first quarter of fiscal 2017, as energy
efficiency applications increased to 48% of our revenue, compared
with 35% in last year’s first quarter, with global shipments to
customer sites that included hotels, office buildings, hospitals,
retail and industrial applications. Our recently launched C1000
Signature Series is targeted directly at these markets, and I’m
proud to say we shipped the first Signature Series unit to Europe
this quarter. Oil, gas and natural resources applications declined
to 46% of revenue compared with 55% during last year’s first
quarter, and renewable energy applications were 6% of our sales
compared with 10% in first quarter fiscal 2016.”
Mr. Jamison additionally noted, “With our emphasis on geographic
expansion, revenue in Asia, Australia, Europe, Russia, the Middle
East and Africa increased over last year’s first quarter.
Collectively, these markets accounted for almost 54% of our product
shipments this quarter, compared with 29% in the year-ago first
quarter.”
Financial Highlights of Fiscal 2017
First Quarter:
- Net loss for the first quarter improved $1.5 million, or 25%,
to $4.5 million compared with $6.0 million in last year’s first
quarter.
- Loss per share decreased 53% to $0.17 compared to last year’s
first quarter loss per share of $0.36 (split adjusted). Weighted
average shares outstanding at the end of the first quarter of
fiscal 2017 were 27.2 million compared with 16.5 million in the
year-ago first quarter.
- Total revenue for the first quarter of fiscal 2017 was $19.1
million, a decrease of 29% compared with $27.0 million in the
year-ago first quarter.
- Gross margin for the quarter was 16% compared to 17% in the
year-ago fiscal first quarter, despite a 40% decrease in product
shipments.
- Operating expenses for the quarter were reduced by $3.1
million, or 30%, to $7.4 million from $10.5 million in the year-ago
first quarter.
- Cash and cash equivalents were $24.0 million as of June 30,
2016, including $13.1 million in net proceeds from our public
offering in April and $5 million of restricted cash related to our
Wells Fargo credit facility, compared to cash and cash equivalents
of $16.7 million, including restricted cash of $5 million from the
credit facility as of March 31, 2016.
- Inventories improved to $16.1 million compared with $26.4
million in the year-ago first quarter, a decrease of $10.3 million,
and a decrease of $2.2 million from inventories at the end of the
fourth quarter of fiscal 2016.
- Accounts payable and accrued expenses were $13.2 million
compared with $23.4 million in the first quarter fiscal
2016.
- Bad debt recovery was $0.9 million during the first quarter of
fiscal 2017 primarily from EMI, one of our distributors in the
Middle East and Africa. There were no bad debt charges or
recoveries recorded during the first quarter of fiscal 2016.
- Book-to-bill for the quarter improved to 0.9 compared with 0.7
in the year-ago first quarter.
- Positive working capital of $2.0 million was generated for the
first quarter of fiscal 2017 compared to $2.5 million used in last
year’s fiscal first quarter.
- As of June 30, 2016, borrowings on the Wells Fargo credit
facility were $6.1 million, a $3.4 million decrease from borrowings
as of March 31, 2016.
Mr. Jamison concluded, “As energy efficiency applications become
the largest part of our business and we continue our strategy of
geographical expansion, we remain determined to grow revenue to
achieve our stated profitability targets, despite the macroeconomic
headwinds. With the continued acceptance of our new C1000 Signature
Series product, growth of our higher-margin service business and
new revenue from our Capstone Energy Finance joint venture, we
believe we are on track to reach our $25 million quarterly revenue
goal.”
Conference Call and Webcast
The Company will host a live webcast today, August 4, 2016 at
1:45 PM Pacific Time (4:45 PM Eastern Time) to provide the results
of the first quarter fiscal 2017 ended June 30, 2016. The company
will discuss its financial results and will provide an update on
its business activities. At the end of the conference call,
Capstone will host a question-and-answer session to provide an
opportunity for financial analysts to ask questions. Investors and
interested individuals are invited to listen to the webcast by
logging on to the company's investor relations webpage at
www.capstoneturbine.com. A replay of the webcast will be available
on the website for 30 days.
About Capstone Turbine CorporationCapstone
Turbine Corporation (www.capstoneturbine.com) (Nasdaq:CPST) is the
world's leading producer of low-emission microturbine systems and
was the first to market commercially viable microturbine energy
products. Capstone has shipped approximately 8,800 Capstone
Microturbine systems to customers worldwide. These award-winning
systems have logged millions of documented runtime operating
hours. Capstone is a member of the U.S. Environmental
Protection Agency's Combined Heat and Power Partnership, which
is committed to improving the efficiency of the nation's energy
infrastructure and reducing emissions of pollutants and greenhouse
gases. A UL-Certified ISO 9001:2008 and ISO 14001:2004 certified
company, Capstone is headquartered in the Los Angeles area
with sales and/or service centers in the United States, Latin
America, Europe, Middle East, China and Singapore.
This press release contains "forward-looking statements," as
that term is used in the federal securities laws, about market
growth in the energy efficiency market, achieving profitability,
diversifying our business, success of geographic expansion, sales
of the C1000 Signature Series, growth of our service business and
revenue from the Capstone Energy Finance joint venture.
Forward-looking statements may be identified by words such as
"expects," "objective," "intend," "targeted," "plan" and similar
phrases. These forward-looking statements are subject to numerous
assumptions, risks and uncertainties described in Capstone's
filings with the Securities and Exchange Commission that may cause
Capstone's actual results to be materially different from any
future results expressed or implied in such statements. Capstone
cautions readers not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
release. Capstone undertakes no obligation, and specifically
disclaims any obligation, to release any revisions to any
forward-looking statements to reflect events or circumstances after
the date of this release or to reflect the occurrence of
unanticipated events.
"Capstone" and "Capstone Microturbine" are registered trademarks
of Capstone Turbine Corporation. All other trademarks
mentioned are the property of their respective owners.
Financial Tables Follow
|
|
CAPSTONE TURBINE CORPORATION AND
SUBSIDIARIES |
|
CONDENSED CONSOLIDATED BALANCE
SHEETS |
|
(In thousands, except share
amounts) |
|
(Unaudited) |
|
|
|
|
|
June 30, |
|
March 31, |
|
|
|
2016 |
|
2016 |
|
Assets |
|
|
|
|
|
|
|
Current Assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
|
19,039 |
|
|
$ |
|
11,704 |
|
|
Restricted cash |
|
|
|
5,004 |
|
|
|
|
5,002 |
|
|
Accounts receivable, net of
allowances of $7,834 at June 30, 2016 and $8,909 at March 31,
2016 |
|
|
|
15,734 |
|
|
|
|
13,575 |
|
|
Inventories |
|
|
|
13,809 |
|
|
|
|
16,126 |
|
|
Prepaid expenses and other current
assets |
|
|
|
2,376 |
|
|
|
|
2,636 |
|
|
Total current assets |
|
|
|
55,962 |
|
|
|
|
49,043 |
|
|
Property, plant and
equipment, net |
|
|
|
3,068 |
|
|
|
|
3,537 |
|
|
Non-current portion of
inventories |
|
|
|
2,317 |
|
|
|
|
2,143 |
|
|
Intangible assets,
net |
|
|
|
873 |
|
|
|
|
941 |
|
|
Other assets |
|
|
|
208 |
|
|
|
|
228 |
|
|
Total |
|
$ |
|
62,428 |
|
|
$ |
|
55,892 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
Current
Liabilities: |
|
|
|
|
|
|
|
Accounts payable and accrued
expenses |
|
$ |
|
13,235 |
|
|
$ |
|
13,187 |
|
|
Accrued salaries and wages |
|
|
|
1,521 |
|
|
|
|
1,880 |
|
|
Accrued warranty reserve |
|
|
|
1,404 |
|
|
|
|
1,639 |
|
|
Deferred revenue |
|
|
|
6,231 |
|
|
|
|
4,368 |
|
|
Revolving credit facility |
|
|
|
6,077 |
|
|
|
|
9,459 |
|
|
Current portion of notes payable
and capital lease obligations |
|
|
|
128 |
|
|
|
|
361 |
|
|
Total current liabilities |
|
|
|
28,596 |
|
|
|
|
30,894 |
|
|
Long-term portion of
notes payable and capital lease obligations |
|
|
|
60 |
|
|
|
|
74 |
|
|
Other long-term
liabilities |
|
|
|
183 |
|
|
|
|
184 |
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
Stockholders’
Equity: |
|
|
|
|
|
|
|
Preferred stock, $.001 par value;
10,000,000 shares authorized; none issued |
|
|
|
|
|
|
|
Common stock, $.001 par value;
515,000,000 shares authorized, 30,237,172 shares issued
and 30,129,019 shares outstanding at June 30, 2016; 23,857,516
shares issued and 23,753,873 shares outstanding at March 31,
2016 |
|
|
|
30 |
|
|
|
|
24 |
|
|
Additional paid-in capital |
|
|
|
866,653 |
|
|
|
|
853,288 |
|
|
Accumulated deficit |
|
|
|
(831,470 |
) |
|
|
|
(826,955 |
) |
|
Treasury stock, at cost; 108,153
shares at June 30, 2016 and 103,643 shares at March 31, 2016 |
|
|
|
(1,624 |
) |
|
|
|
(1,617 |
) |
|
Total stockholders’ equity |
|
|
|
33,589 |
|
|
|
|
24,740 |
|
|
Total |
|
$ |
|
62,428 |
|
|
$ |
|
55,892 |
|
|
|
|
CAPSTONE TURBINE CORPORATION AND
SUBSIDIARIES |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
(In thousands, except per share
data) |
|
(Unaudited) |
|
|
|
|
|
Three Months Ended |
|
|
|
June 30, |
|
|
|
2016 |
|
2015 |
|
Revenue: |
|
|
|
|
|
|
|
Product, accessories and parts |
|
$ |
|
15,783 |
|
|
$ |
|
24,146 |
|
|
Service |
|
|
|
3,282 |
|
|
|
|
2,834 |
|
|
Total revenue |
|
|
|
19,065 |
|
|
|
|
26,980 |
|
|
Cost of goods
sold: |
|
|
|
|
|
|
|
Product, accessories and parts |
|
|
|
13,637 |
|
|
|
|
19,914 |
|
|
Service |
|
|
|
2,429 |
|
|
|
|
2,381 |
|
|
Total cost of goods
sold |
|
|
|
16,066 |
|
|
|
|
22,295 |
|
|
Gross margin |
|
|
|
2,999 |
|
|
|
|
4,685 |
|
|
Operating
expenses: |
|
|
|
|
|
|
|
Research and development |
|
|
|
1,621 |
|
|
|
|
2,416 |
|
|
Selling, general and
administrative |
|
|
|
5,746 |
|
|
|
|
8,089 |
|
|
Total operating expenses |
|
|
|
7,367 |
|
|
|
|
10,505 |
|
|
Loss from
operations |
|
|
|
(4,368 |
) |
|
|
|
(5,820 |
) |
|
Other (expense)
income |
|
|
|
(16 |
) |
|
|
|
(2 |
) |
|
Interest income |
|
|
|
5 |
|
|
|
— |
|
Interest expense |
|
|
|
(134 |
) |
|
|
|
(150 |
) |
|
Loss before income
taxes |
|
|
|
(4,513 |
) |
|
|
|
(5,972 |
) |
|
Provision for income
taxes |
|
|
|
3 |
|
|
|
|
3 |
|
|
Net loss |
|
$ |
|
(4,516 |
) |
|
$ |
|
(5,975 |
) |
|
Net loss per common
share—basic and diluted |
|
$ |
|
(0.17 |
) |
|
$ |
|
(0.36 |
) |
|
Weighted average shares
used to calculate basic and diluted net loss per
common share |
|
|
|
27,171 |
|
|
|
|
16,528 |
|
|
|
|
CONTACT:
Capstone Turbine Corporation
Investor and investment media inquiries:
818-407-3628
ir@capstoneturbine.com
INVESTORS:
Dian Griesel Int’l.
Cheryl Schneider
212-825-3210
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